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NatWest Group’s new chief executive Paul Thwaite has slashed his executive committee to remove “unnecessary complexity” as the bank embarks on an era without the UK government as a controlling shareholder and prepares for a sale of stock to retail investors.
Thwaite, who has been chief for just two months, announced a string of management changes that will reduce the retail banking group’s executive committee by a third.
Moves include the departure of the bank’s group chief legal officer and general counsel, Gideon Moore, and the exit of its director of strategy and corporate development, Matt Austen, according to a note to colleagues on Tuesday.
NatWest also said that Robert Begbie — a 40-year veteran of the bank who is both the interim head of its commercial arm and of NatWest Markets — has been approved by regulators as the permanent chief of commercial and institutional banking.
Regulators agreed that a single person could run a division that straddles both the “ringfenced” bank, designed to protect depositors’ money from losses in trading, and the “non-ringfenced” businesses where riskier activities are carried out, a person familiar with the situation said.
The Prudential Regulation Authority declined to comment and the Financial Conduct Authority did not immediately respond to requests for comment.
Thwaite’s changes follow Monday’s announcement that the UK government — which was forced to inject £45.5bn into the bank in the depths of the financial crisis — had reduced its stake below the 30 per cent that gave it a “controlling interest”.
In his note, the contents of which were confirmed by NatWest, Thwaite said the changes reflected his view that “customer focus and simplification needs to start at the top of the bank — removing unnecessary complexity and streamlining decision-making processes, so colleagues can focus time and energy on the areas they can have the greatest impact and add the most value for customers”.
NatWest reported better than expected results for the final quarter of 2023, buoyed by higher interest rates.
But like all UK lenders, it must navigate the challenges of a cost of living crisis and higher borrowing costs, which together threaten a wave of defaults and prompted Thwaite’s promise to cut costs by simplifying the bank’s operations.
The bank suffered serious reputational damage last year when disclosures about its dealings with former Ukip leader Nigel Farage led to the ousting of Thwaite’s predecessor, Dame Alison Rose, and that of Peter Flavel, boss of the group’s private bank, Coutts.
The UK lender will have a new chair, Rick Haythornthwaite, from April 15 after the end of the term of former Financial Services Authority chair Sir Howard Davies. It also previously announced that UBS executive Emma Crystal would replace Flavel.
It is now recruiting for a new head of NatWest Markets, who will report to Begbie, and a new chief corporate affairs officer.
Other changes announced internally on Tuesday include the creation of a new group chief operating office, to be led by Jen Tippin, who joined the bank from Lloyds Banking Group four years ago.
The office will oversee the group’s people and transformation, marketing, communications, legal, governance and regulatory affairs teams.
“Today, we have announced changes to our structure, which will help us shape the future of the bank and accelerate the delivery of the priorities set out at our recent financial results,” the bank said.
“The new structure will enable NatWest Group to operate as a simpler, more integrated business and, ultimately, better serve and support our customers.”
Thwaite’s simplification drive has already led to NatWest scaling back the number of meeting forums and the size of the chief’s support team.
With additional reporting by Patrick Jenkins in London