Crisis-hit NatWest bank launches review into Farage case

LONDON — British bank NatWest on Friday said it had launched an independent review into its handling of arch-Brexiteer Nigel Farage, whose account it controversially shut, costing top executives their jobs following political pressure. 

The announcement by chairman Howard Davies came after the lender, 39 per cent owned by the UK government, posted a jump in first-half net profits on higher interest rates. 

The head of NatWest's private banking arm Coutts resigned Thursday, one day after Alison Rose quit as NatWest CEO. 

At the end of a crisis-hit week, NatWest said group profit after tax jumped 22 per cent to £2.3 billion ($2.9 billion) in the first six months of the year. 

Davies added in a media call that the group had appointed UK law firm Travers Smith to lead the review into the bank's handling of Farage.

"The last few weeks have been a painful period for the bank, and we apologise for the uncertainty created for customers and shareholders," Davies told reporters.

Interim chief executive Paul Thwaite added it was "an understatement to say that these are not ideal circumstances for anyone to take over".

"It's clear to me that we got some things wrong.

"It will take time to address some of those challenges, but I've already taken action. I'm determined we learn, and start to move forward quickly," Thwaite added.

'Error of judgment' 

Farage, former leader of the Brexit Party and the anti-immigration party UKIP, has complained that he was removed as a client of Coutts for his political views.

In a report which it has since apologised for, the BBC had suggested Farage's account was closed because he did not have sufficient funds to remain a client of the prestigious establishment.

Farage, a Eurosceptic politician and now a television presenter, campaigned for decades for Britain's withdrawal from the European Union and was a key figure in the 2016 Brexit referendum.

It later emerged that the BBC had spoken with Rose about Farage, and while NatWest's board initially backed her, it soon thereafter announced she was stepping down after having worked at the bank for 30 years.

Explaining the U-turn, Davies added Friday: 

"We believe that [backing Rose] was a rational decision to make at the time, However, the reaction, the political reaction to that, was such that Alison and I then concluded, and the board supported the view, that her position was then untenable.

"She would be running the bank in the face of very difficult headwinds, and therefore we made a different decision," the chairman said.

Rose had admitted making a "serious error of judgment" in speaking to a BBC reporter about Farage's banking affairs. Meanwhile Peter Flavel, chief executive of Coutts since March 2016, quit the upmarket bank Thursday.

NatWest was formerly known as Royal Bank of Scotland — the lender rescued following the 2008 global financial crisis with £45.5 billion of UK taxpayers' cash in what was the world's biggest banking bailout.

Rose, the only woman CEO to have led a major UK bank, decided to rebrand the lender after her appointment in 2019, while the government has gradually cut its stake as the bank recovered.