NatWest chair Sir Howard Davies has announced that he will step down from his role at the UK high street bank by the middle of next year.
Speaking at the lender’s annual meeting in Edinburgh on Tuesday, Davies said it was time for NatWest to start looking for his replacement. “I am approaching the point where I will have served eight years on the board so it is appropriate to initiate the search for my successor as chairman in the coming months,” he said.
Davies said he expected the handover to take place before he reaches nine years of tenure in July 2024, the maximum recommended time to serve in the role under the UK corporate governance code.
Davies is the longest-serving chair among the big four high street banks, having held his post since September 2015. NatWest shares have fallen more than 20 per cent since he took over and 1 per cent since the start of the year.
“One would have hoped the share price would have been even stronger but that’s the way banks are valued at the moment,” said Davies, although he emphasised that NatWest was now a “normal bank” rather than the “outlier” it was when he took over.
The “rigorous search process” for his successor will be led jointly by the senior independent directors of NatWest Group and NatWest Holdings, he said.
Before joining NatWest, Davies served as chair of the Financial Services Authority, deputy governor of the Bank of England and director of the London School of Economics. In the 1980s he was a special adviser to then chancellor of the exchequer Nigel Lawson.
Other board changes include the departure following the AGM of Mike Rogers, a former Barclays banker and chair of credit checker Experian. Morten Friis, who previously held senior roles at Royal Bank of Canada, is due to leave in July after nine years on the board.
NatWest, known until 2020 as the Royal Bank of Scotland, is still 41.5 per cent owned by the government following its £46bn bailout in 2008. The UK government earlier this month announced it was extending the timeline on a “trading plan” to reduce its stake, although it still intended to fully divest its shareholding by 2025-26.
Its shares on Tuesday were trading around 270p, significantly below the 502p per share that the government paid to bail out the bank.
NatWest was the first major lender to announce that it was departing from the crisis-stricken CBI on Friday, as the UK business lobby group struggled to recover from weeks of damaging allegations about its toxic workplace culture.
Speaking after the AGM, chief executive Alison Rose emphasised the “need [for] a good strong voice for business”.
The bank is due to report its first-quarter results on Friday. In the three months to December it reported a year on year tripling of pre-tax operating profit to £1.4bn.
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