NatWest Group (LSE: NWG) finally gave investors a reason to cheer on Friday after delivering stronger-than-expected quarterly results and upgrading its full-year guidance.
The bank’s third-quarter pretax profit surged 30% to £2.18 billion from £1.67 billion a year earlier, comfortably ahead of forecasts of £1.83 billion.
Total income rose 16% to £4.33 billion, beating expectations and showing that the bank’s core businesses are firing again. Net interest income climbed 13% to £3.27 billion, while non-interest income jumped 26% to £1.06 billion as higher fees and market activity boosted performance.
Retail Banking income grew 14%, Private Banking & Wealth Management rose 12%, and Commercial & Institutional banking improved 6.6%. Assets under management and administration increased 8.1% to £56 billion, helped by client inflows and market gains.
CEO Paul Thwaite credited “healthy customer activity” and consistent delivery for the improvement, noting that NatWest’s three divisions continue to show momentum.
Investors seemed to agree, sending shares up as much as 5% before trimming gains to trade 2% higher by 10.00 GMT.
The bank now expects income excluding notable items to reach around £16.3 billion in 2025, up from previous guidance of above £16 billion. It also lifted its return on tangible equity forecast to above 18%, compared with 16.5% before.
The lender’s capital position strengthened, with its common equity tier 1 ratio improving to 14.2% at the end of September, up from 13.6% in June. Net interest margin also widened to 2.37% from 2.18% a year ago.
After a bruising few years marked by leadership drama and political scrutiny, NatWest’s latest results are a sign of a bank finally finding its rhythm again.
Whether this marks the start of a sustained recovery or just a good quarter in a volatile cycle remains to be seen, but for now, investors will take it.