Post by : Badri Ariffin

NatWest has posted a striking 30% rise in its third-quarter profits, sending its shares to levels not seen in 15 years. The UK banking giant reported pre-tax profits of £2.2 billion for the three months ending September, comfortably beating analyst expectations of £1.8 billion and last year’s £1.7 billion.

The surge was powered by stronger mortgage and corporate lending, reflecting a rebound in client demand. Total income for the quarter rose to £4.3 billion, up from £3.7 billion in the same period last year. For comparison, the bank earned just over £4 billion in income in the previous quarter.

Lending activity accelerated, with NatWest adding £4.4 billion overall, including £1.7 billion in mortgage loans. Its wealth division, including the private bank Coutts, contributed £284 million, up from £252 million last year.

The bank’s improved performance has prompted an upgrade in its full-year guidance. NatWest raised its target for return on tangible equity (ROTE) from 16.5% to 18%, and increased its projected 2025 income to £16.3 billion from the previously guided £16 billion.

NatWest’s net interest margin, the difference between interest earned on loans and paid on deposits, climbed to 2.37% from 2.28% last quarter, helped by structural hedges that mitigate interest rate swings.

Despite the strong earnings, customer deposits fell by £1.1 billion, largely due to lower savings balances in its retail and wealth segments. Provisions for potential loan losses were set at £153 million, below analysts’ £190 million estimate.

With its shares climbing as much as 7% to a 15-year high, NatWest’s robust results underscore its resilience in lending and wealth management, positioning it strongly for the year ahead.