NatWest reported flat pre-tax profits of £2.2 billion in the third quarter, marking the weakest growth among large UK banks despite benefits from higher interest rates. While Lloyds Banking Group saw pre-tax profits nearly double to £2.3 billion and HSBC grew profits by 32 percent, NatWest's revenue rose to £4.6 billion from £4.3 billion a year prior. The commercial and institutional banking division, along with the wealth business, were the strongest performers, though the retail division showed comparatively weaker growth.
Analyst Jonathan Pierce of Jefferies warned of potential further scrutiny regarding optimistic net interest income forecasts. On a return on tangible equity basis, NatWest remained one of the highest-performing UK lenders. Chancellor John Healey announced a 6 percent surcharge on bank profits over £100 million, less steep than the 8 percent anticipated, prompting mixed reactions from bank leadership.
NatWest CEO Paul Thwaite acknowledged fiscal pressures but emphasized the need to remain competitive for customers and shareholders. This year, NatWest completed its £2.7 billion acquisition of Evelyn Partners, Britain's third-largest wealth manager, integrating the "mass affluent" segment to allow Coutts to focus on the ultra-rich. The deal marks NatWest's largest acquisition since the £49 billion ABN Amro takeover prior to the financial crisis.
NatWest shares, up 150 percent since Thwaite's 2023 appointment, traded down 3 percent in early Friday trading.
Source: Financial Times Companies · Summarized by HeadlinesBriefing