NatWest is pursuing its first US expansion since the 2008 financial crisis after receiving the greenlight to open a Connecticut-based representative office.
NatWest will use this new office to support its US client relationships, according to people close to the matter.
It expands on its existing Stamford, Connecticut office which supports institutional clients to help perform trades via its broker-dealer licence.
NatWest was approved by the US Federal Reserve to establish a representative office on 20 August.
Sources told Payment Expert the office will support NatWest’s large corporate and institutional clients in the US to offer markets, lending, infrastructure and project finance.
However, due to the nature of a representative office licence, NatWest will not be able to accept deposits from its US subsidiaries.
The Representative office in the US will create an opportunity to strengthen NatWest Group’s (NWG’s) operating model by enabling on-the-ground relationship management, credit support, and market engagement to deepen customer relationships, and enhance risk oversight.
NatWest’s Stamford offices serve its North American operations, which includes Canada. The bank also has a presence in Singapore and Tokyo to serve Asia-Pacific operations, whilst also having European offices in cities such as Amsterdam, Frankfurt, Milan, Paris and Stockholm.
Relaxed ring-fencing bank regulations helped NatWest expansion
People familiar with the matter told Payment Expert that NatWest’s representative office licence approvals were enabled by the relaxation of ring-fencing bank rules which came into effect in January 2025.
In the UK, following the 2008 financial crisis, large-scale banks with more than £25bn in retail deposits were required to split their retail banking services from their investment services to minimise consumer risk.
This was primarily applicable to NatWest and the other ‘Big Four’ UK banks – Lloyds, HSBC and Barclays.
The regime came fully into force on 1 January 2019. It bars ring-fenced banks from high-risk trading, chiefly dealing in investments as principal, and from owning branches or subsidiaries outside the European Economic Area (EEA).
These regulations meant banks could not scale operations in regions outside of the EEA, which includes the US.
However, in January 2025 the ring-fencing bank rules were updated as part of revisions to the Financial Services and Markets Act 2000 (FSMA), allowing UK bank overseas subsidiaries to hold minority investments of up to 20% outside the UK and EEA.
US payment processing still blocked for NatWest
Despite securing the representative office licence, this does not mean the UK bank can begin to process, accept, handle or settle transactions.
The licence means NatWest’s US subsidiary acts as a regional business hub and can not issue invoices, sign commercial deals or conduct daily transactions.
For the bank to be able to process payments though US payment rails like ACH and FedNow, it must secure a bank charter licence from the Office of the Comptroller of the Currency (OCC).
The OCC has been granting bank charter licences to the likes of Nubank, Circle and cryptocurrency exchange Kraken’s banking unit Kraken Financial. However, the OCC has denied licences to bunq and Wise in recent months.
Other UK banks, such as Lloyds Banking Group, have also considered a more aggressive US expansion and announced plans to grow its North American operations by creating a corporate and institutional bank by 2030.
It is unclear whether NatWest intends to launch an investment or retail banking operation in the US.
