NatWest Group has become the latest UK banking giant to report a sharp drop in earnings for the first three months of the year.
The lender said pre-tax profits in the first quarter of 2024 were £1.3bn – a fall of nearly 28% on the same period a year ago.
However, the figure was better than the £1.2bn forecast by analysts, and the bank’s chief executive described the results overall as “strong”.
Increased competition for savings, lending and mortgage products has squeezed margins across the banking sector in recent months.
Lloyds Banking Group revealed earlier this week that its pre-tax profits plunged by 28% during the first quarter, while Barclays reported a fall of 12%.
NatWest also said on Friday that its income for the quarter was £406m lower than the same period last year, in part due to lower deposit balances and customers shifting their savings to higher-interest accounts.
Impairments, a closely watched measure of loan losses, were £93m – much better than the £186m forecast by analysts.
NatWest chief executive Paul Thwaite said: “NatWest Group has delivered a strong set of results for the first quarter – with an operating profit of £1.3bn – as we remain focused on the priorities we set out in February, which will help us shape the future of this bank.
“Our performance is grounded in the vital role we play in the economy and in the lives of our 19 million customers.
“Though macro-uncertainty continues, customer confidence and activity is improving, with both lending and deposits up in the quarter and impairments remaining low, reflecting our well-diversified business.”
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Last month it was confirmed that the UK government’s stake in the bank had fallen below 30%, meaning it is no longer the controlling shareholder.
NatWest received several…
