On Wednesday, the government is planning to speed up the sale of its stake in NatWest Group PLC (LSE:NWG) with a 'Tell Sid' style offer for small investors in the next year.
Chancellor of the Exchequer Jeremy Hunt said the plan is for the taxpayer's stake to be fully sold by 2026.
In his autumn statement, Hunt said he would look at various options, including a potential retail offer of the £23 billion-valued bank in the next 12 months, "subject to supportive market conditions and achieving value for money".
Currently, the state ownership of NatWest stands at just under 39%, following a series of sales in recent years, including three in February and March this year, and a buyback by the bank in May.
The origin of the stake is from the government bail-out of what was Royal Bank of Scotland Group during the 2007-08 financial crisis.
He said the government intends to fully exit by 2025-26 using a range of methods, including accelerated bookbuilds and directed buybacks.
A retail offer would be one of a number of options to be explored, he added.
Ask Sid, is price right?
Laith Khalaf, head of investment analysis at AJ Bell, was one of many financial commentators to hark back to the iconic ‘Tell Sid’ campaign when the government privatised British Gas.
"The sale of some of the government’s NatWest stake to retail investors will probably strike a chord with some of the original Sids and Sidesses, seeing as its appeal probably lies with an older demographic with a focus on income rather than growth," said Khalaf.
“For those experienced investors accustomed to holding shares, this might be an opportunity to pick up a slice of a high street bank at an attractive price."
Richard Berry of Goodmoneyguide was sceptical, saying: "Times have changed and Sid's unlikely to be listening, even to those who remember him.
While the privatisation of British Gas in the 1980s captured the public imagination as buying shares in an individual company was prohibitively expensive for smaller investors, nowadays Berry says the average investor is "far more sophisticated".
He said the Chancellor shouldn’t count on a stampede of buyers, including Nigel Farage.
“With retail investors enjoying so much choice now, the price the Government asks for its shares will be key," Berry said.
“Plus, Natwest shares currently look like a dog of an investment to me. Although they did go up about 10% after the bank’s spectacular falling out with its vocal former customer, so if the bank’s board continues to make sensible decisions the shares may be worth a buy.”
Khalaf agreed that earnings growth from a company like NatWest “isn’t likely to set the world on fire, especially when compared to the likes of Apple and Microsoft who are capitalising on the tech boom. The UK banking sector has been deeply unloved for years, and shares trade at lowly valuations. That does provide some upside potential for the share price should there be a positive reappraisal of the UK economy or the stock market, but that’s already been a long time coming.”