A sign outside a NatWest Group Plc bank branch in the City of London, UK, on Tuesday, July 25, 2023. Natwest is due to report first-half results on Friday, July 28. Photographer: Hollie Adams/Bloomberg via Getty Images
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NatWest reported its first quarter profit rose 36% on Friday, thanks to healthier margins on its deposit base, increased loan balances and better trading income.
The results come as the British lender prepares to return fully to private ownership for the first time since its state rescue at the height of the 2008 financial crisis.
“Our strong first quarter performance demonstrates the positive momentum in our business as we deliver against clear strategic priorities, and we now expect to be at the upper end of our income and returns guidance for 2025,” Chief Executive Paul Thwaite said in a statement.
The bank reported operating profit before tax for January-March of 1.8 billion pounds, up from 1.3 billion pounds in the same period a year ago and better than the average of analysts’ forecasts of 1.6 billion pounds.
It reported a return on tangible equity of 18.5% in the quarter compared with 14.2% a year ago.
The government’s stake in NatWest fell below 2% on Thursday, having reduced its shareholding from nearly 40% in December 2023.
The bank’s Chairman earlier in April said the lender’s upcoming exit from state ownership represents an inflection point for the bank, as it pivots from years of post-crisis restructuring to a domestic growth-focused strategy.
This approach has so far insulated NatWest from the fallout to global trade tensions in the wake of U.S. President Donald Trump’s sweeping tariffs, compared to some internationally-focused rivals.
The bank booked a net impairment charge of 189 million pounds, and said levels of default were stable.