LONDON (Reuters) -The UK government is no longer the largest shareholder in NatWest after it sold a further 89 million shares in the bank on Thursday, slipping down the lender's investor register for the first time since its crisis-era bailout.

The government stake, which was once as large as 84%, now stands at 4.82%.

According to LSEG data, BlackRock Investment Management (UK) is now NatWest's largest investor, with a 5.72% position.

"Returning the bank to full private ownership is an ambition we share with the government, and one that we believe is in the interests of all our shareholders," a NatWest Group spokesperson said in a statement.

NatWest CEO Paul Thwaite said in February the bank was on track to return to full private ownership "sometime in 2025". But analysts said the government exit could come as early as June based on the current pace of share sales.

The bank has also used excess capital to buy shares directly from the government, with the most recent 1 billion pound purchase struck in November.

Chair Rick Haythornthwaite said last April that the government exit would end a "sorry tale" for both the country and the lender.

NatWest shares, which have risen by 74% in the past 12 months, were trading 1.6% lower at 439.1 pence at 1102 GMT.

NatWest has remained on the public's books much longer than other banks rescued during the 2008-9 financial crisis. Still, the government's position has shrunk rapidly in recent months, from around 38% in December 2023 to less than 10% in December 2024.

Rival Lloyds Banking Group was returned to full private ownership in May 2017.

($1 = 0.7721 pounds)

(Reporting By Sinead Cruise; editing by Dhara Ranasinghe)