Taxpayers have suffered a £10.5bn loss on the bailout of NatWest after the Government sold its last shares in the bank.

The Treasury announced on Friday that it had officially offloaded its remaining stake 17 years after it was forced to pump £45.5bn into what was then Royal Bank of Scotland (RBS) to stave off collapse.

The government under former Labour prime minister Gordon Brown took an 84pc stake in the lender following a series of bailouts between 2008 and 2009. Since then, the UK Government has progressively been selling its shares. It offloaded its remaining 0.9pc stake on Friday.

However, the share price of NatWest, as Royal Bank of Scotland was rebranded in 2020, has never recovered to where it stood at the time of the bailout.

The Treasury has recovered just £35bn through share sales and dividends, leaving the taxpayer to suffer losses of around £10.5bn. Officials said letting NatWest collapse during the 2008 crash would have seen taxpayers suffer an even greater financial hit.

Rachel Reeves, the Chancellor, said: “Nearly two decades ago, the then government stepped in to protect millions of savers and businesses from the consequences of the collapse of RBS.

“That was the right decision then to secure the economy and NatWest’s return to private ownership turns the page on a significant chapter in this country’s history.

“We protected the economy in a time of crisis nearly 17 years ago, now we are focused on securing Britain’s future in a new era of global change.”

‘Largely symbolic’

NatWest’s share price fell by more than 96pc during the global financial crisis after it was caught up in the US subprime mortgage crisis. At the time, it was one of the largest banks in the world, with over 40m customers and operations in 50 countries.

Rick Haythornthwaite, NatWest’s chairman, said the Treasury’s exit was “largely symbolic”. He added: “I don’t think it’s a moment to celebrate. It’s a moment to reflect on what an extraordinary act was taken on by the government of the day and the taxpayer.

“It was a very complex restructuring. Remember, RBS was the largest bank in the world with a two trillion-[pound] balance sheet and nearly 200,000 people – there was a lot to sort out.”

Mr Haythornthwaite said the end of government ownership would also see new investment flow into the bank from investors who were previously deterred by the Government’s position.

He said “We’re already seeing the impact on our register of new blood and new companies coming on who are more committed to growth.