Acquire, manage and execute the sale of all significant UK government corporate assets
UKGI works across government to support departments on asset sales, advising ministers and senior officials on the best strategies and structures for a sale, carrying out market testing, and devising and managing the sale execution process to achieve value for money for the taxpayer. UKGI has a well-established reputation for selling assets where there is no policy reason for the government to hold the asset, and where the sale can achieve value for money.
The UKGI Financial Institutions Group (FIG) is responsible for the NatWest Group plc (NWG) and UK Asset Resolution Limited (UKAR) portfolios.
Holger joined UKGI in May 2018 and is Director of UKGI’s Financial Institutions Group. He has spent over 20 years advising UK and European financial institutions on a broad range of mergers and acquisitions, capital markets and restructuring transactions. Before joining UKGI Holger was an investment banker at Moelis & Company for 8 years and previously at Morgan Stanley for 7 years having started his career at Credit Suisse.
Holger is a Non-Executive Director of Reclaim Fund Ltd and UK Asset Resolution Ltd.
Daniela joined UKGI (formerly the Shareholder Executive) in 2013 following 12 years working in Equity Capital Markets for Citigroup.
Daniela has complemented her banking experience with further transaction work from a government perspective. This includes co-leading the Student Loans sale programme. She was previously involved in the privatisation of Royal Mail. Daniela has also worked on governance and policy development projects such as the Shaw Report on Network Rail and has assisted the then Department for Communities and Local Government in managing their growing housing sector loan book.
Continuing our work to dispose of the government’s shareholding
As set out at Budget 2023, the government intends to fully dispose of the NWG (formerly Royal Bank of Scotland Group plc) shareholding by 2025-26, subject to market conditions and any sale achieving value for money. Over the past year, the government has continued to make progress in this policy.
Following the successful launch of a Trading Plan in NWG shares in August 2021, in April 2023 the Trading Plan was extended to 11 August 2025.
A Trading Plan, otherwise known as a “dribble out”, involves selling shares in the market through an appointed broker in an orderly way at market prices over the duration of the plan. Shares will only be sold at a price that represents value for money for taxpayers. Since launch, the Trading Plan has delivered over £3.7bn for the taxpayer.
The Trading Plan does not preclude the government from using other options to execute future transactions that achieve value for money for taxpayers, including during the term of the Trading Plan, and FIG continue to actively seek opportunities for further disposal options when market conditions permit. For example, in May 2023, HMG successfully sold just under 5% of the company back to NatWest via a Directed Buyback, raising c. £1.26bn. As a result, as at 22 May the shareholding stood at 38.6%.
In parallel, FIG has continued to engage closely with the NWG Board and Executive team on stewardship issues throughout the year. Over the past 12 months, UKGI has constructively engaged with NWG in a shareholder role on topics such as purpose, values and culture; climate transition plans; remuneration; and technology and innovation, while continuing to manage the government’s shareholding at arm’s length and on a commercial basis.
UK Asset Resolution
Return of Bradford & Bingley and NRAM Limited to private ownership
On 26 February 2021, UK Asset Resolution (UKAR) agreed the sale of the issued share capital and remaining mortgage and loan portfolios of Bradford & Bingley plc and NRAM Limited and their subsidiary companies in a transaction worth around £5 billion. The buyer comprised a consortium of Citibank and Davidson Kempner, with funding provided by PIMCO.
This was a particularly significant sale as it brings to a close the government’s ownership of the assets acquired from its interventions in Northern Rock and Bradford & Bingley during the financial crisis of 2007-08, with the taxpayer fully repaid.
UKGI worked with both UKAR and HM Treasury on the sale, providing expertise to help devise and implement a strategy that delivered government’s objectives and achieved value for money.
In addition to returning taxpayer funds to the Exchequer, a key consideration for the sale was the continued fair treatment of customers, as it has been in previous sales. The transaction results in a change in ownership of B&B and NRAM but does not involve any of their 29,000 customers moving to a new lender. There will be no changes to the terms and conditions of any loans as a result of this transaction and borrowers will continue to receive the same protections for the lifetime of their mortgage as they currently receive under UKAR ownership.
Student loans sale
£1.7 billion raised by new asset class
In December 2017, on behalf of the Department for Education (DfE), UK Government Investments (UKGI) successfully completed the first sale of part of the pre-2012 (Plan One) English student loan book. As well as ensuring value for money to the taxpayer, the transaction – which raised £1.7bn – sought to ensure the position of all borrowers would not change as a result of the sale.
Structured as a multi-tranche securitisation backed by loans with income contingent repayments, this was a world first and launched an entirely new asset class in the capital markets. The capital structure included 3 rated bonds and 1 unrated, with unique and innovative characteristics tailored to the long-term nature of the underlying loans, each designed to appeal to specific pools of capital and attracted significant demand.
This was the first in a programme of sales anticipated to raise approximately £12bn of proceeds, which UKGI is leading on behalf of DfE. UKGI’s model of combining public and private sector expertise has produced a multi-disciplinary transaction team uniquely placed to deliver this complex and innovative project.