NatWest to Buy Evelyn Partners for £2.7 Billion in Post-Privatization Wealth Push

NatWest Group has agreed to buy UK wealth manager Evelyn Partners in a £2.7 billion deal that marks the bank’s largest acquisition since the financial crisis and its first major takeover since the British government sold its final stake last year.

Deal terms and rationale

The all-cash transaction, announced Feb. 9, will see NatWest acquire 100% of Evelyn from private equity owners Permira and Warburg Pincus. The price tag, which includes debt, values Evelyn at 9.7 times its forecast 2025 earnings before interest, tax, depreciation and amortization.

NatWest is pitching the move as a decisive step toward becoming a leading provider of savings, investment and financial planning services, even as investors sent the stock sharply lower on concerns over the cost and the hit to capital.

“Bringing together these two leading businesses creates a unique opportunity to provide financial planning, savings and investment services to more families and people across the UK,” NatWest chief executive Paul Thwaite said in a statement. He said the deal “creates the UK’s leading private banking and wealth management business” and called it “a strategically and financially compelling use of capital.”

Under the terms of the deal, NatWest will fund the purchase from its existing resources rather than issuing new shares. The bank said it expects the acquisition to reduce its common equity Tier 1 capital ratio by about 1.3 percentage points, but still leave it comfortably above regulatory requirements.

At the same time, NatWest announced a £750 million share buyback, but signaled that any further repurchase plans will not be set out until its first-half 2027 results. The bank said its policy of paying out around 50% of attributable profit as ordinary dividends remains unchanged.

What Evelyn brings

Evelyn, which traces its roots back more than 180 years through predecessor firms Tilney and Smith & Williamson, manages and administers about £69 billion in client assets. Its business spans financial planning, discretionary investment management and the Bestinvest online investing platform for self-directed savers.

In 2025, Evelyn generated £509 million in operating income and £179 million in EBITDA, according to figures released with the deal announcement. NatWest said Evelyn grew assets under management and administration at more than 7% a year between 2023 and 2025, supported by £1.6 billion of net new money last year.

NatWest’s existing private banking and wealth arm — which includes Coutts, the bank to the British royal family — oversees roughly £59 billion of assets. The combination with Evelyn will create a platform with £127 billion in assets under management and administration and about £188 billion of customer assets and liabilities, NatWest said.

Timing and regulatory approvals

The purchase is subject to approval by UK regulators including the Prudential Regulation Authority and the Financial Conduct Authority. NatWest said it expects the deal to close in the summer of 2026, though it cautioned that timing will depend on how quickly approvals are granted.

Evelyn chief executive Paul Geddes said the firm’s management backed the tie-up as the next stage of its expansion after a decade under private equity ownership.

“We are delighted to join NatWest Group, which marks an exciting new chapter for Evelyn Partners,” Geddes said. “Together, we have the scale, resources and shared vision to provide unparalleled service to our clients. We look forward to working together to build on our success and drive future growth.”

How Evelyn became a target

Permira first invested in Bestinvest in 2014 and went on to build a larger wealth group through acquisitions of Tilney, Towry and Smith & Williamson. The merger of Tilney and Smith & Williamson in 2020 created Tilney Smith & Williamson, which rebranded as Evelyn Partners in 2022. Warburg Pincus joined as a minority investor in 2020.

The sale follows Evelyn’s 2025 disposal of its professional services arm to Apax Partners, leaving a more focused wealth management business that industry analysts had expected to become a takeover target. Local media had previously reported interest from rival suitors including Barclays and RBC Brewin Dolphin.

A symbolic moment for NatWest

For NatWest, the deal is a symbolic moment. The bank, formerly known as Royal Bank of Scotland, was rescued with a £45 billion government bailout during the 2008-09 financial crisis, leaving taxpayers with an 84% stake at one point. The Treasury completed the sell-down of its remaining holding in May 2025, returning NatWest to full private ownership for the first time in 17 years.

The decision to deploy billions of pounds of surplus capital on acquisitions rather than continuing large buybacks marks a shift in emphasis after years in which the bank focused on shrinking its balance sheet and returning cash to shareholders.

NatWest argues that investing in wealth management will strengthen long-term profitability by increasing fee income, which is less sensitive to interest rates than traditional lending margins, and by growing capital-light businesses that consume relatively little regulatory capital.

Synergies, risks and market reaction

The bank expects to achieve around £100 million of annual cost savings from integrating Evelyn with its existing private banking and wealth arm, equivalent to about 10% of their combined cost base. It estimates one-off integration and restructuring costs of about £150 million.

Revenue synergies — such as cross-selling financial planning and investment services to NatWest’s roughly 20 million retail and commercial customers — have not been quantified publicly. NatWest said the acquisition should lift group fee income by about 20% before any revenue synergies and be accretive to growth and return on tangible equity in the first full year after completion.

Analysts and investors reacted cautiously. NatWest shares fell between 4% and 6% in London trading on the day of the announcement, making the lender the worst performer in the FTSE 100. The broader UK blue-chip index and European bank stocks were little changed, suggesting the move reflected concerns specific to NatWest’s strategy and the valuation paid for Evelyn.

Some analysts questioned whether the bank had overpaid compared with other listed wealth managers and recent transactions in the sector, and highlighted execution risks in delivering promised cost cuts and retaining advisers and clients during integration.

The planned savings also raise questions about employment. Evelyn employs around 2,400 people across 21 offices in the UK, Ireland and the Channel Islands. NatWest has not given a figure for potential job losses but has acknowledged there will be overlap in functions that will need to be addressed.

Consumer advocates and regulators are likely to scrutinize how the enlarged group manages potential conflicts of interest as it combines banking, advice and investment products under one roof. The FCA has made fair treatment of customers and clarity of charges central themes in its oversight of wealth management and financial advice.

NatWest, for its part, is presenting the deal as aligned with broader efforts to encourage long-term saving and investment in the UK.

“At a time when the benefits of saving and investing are increasingly part of the national conversation, we can help customers to make more of their money through a broader range of services, as well as helping to drive growth and investment across the economy,” Thwaite said.

Whether shareholders come to share that view will depend on how smoothly the integration proceeds, how much new business the combined platform can attract and whether the long-term returns from Evelyn ultimately justify diverting capital away from more immediate cash returns. Those answers are unlikely to be clear before the next phase of NatWest’s capital plans comes into focus in 2027.