NatWest earnings jump by a third as mortgage lending grows
NatWest joins Lloyds and Barclays in unveiling higher profits than analysts were expecting this week.
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NatWest Group has become the third high street bank to report higher-than-expected earnings after revealing it provided more mortgages in recent months.
The banking group said it made an operating pre-tax profit of £1.7 billion between July and September, nearly a third higher than the £1.3 billion generated this time last year.
It beat forecasts, with analysts’ previously expecting a profit of £1.5 billion for the latest period.
NatWest joins Lloyds and Barclays in unveiling higher profits than analysts were expecting this week, as the banking sector continues to strengthen as interest rates start to fall.
NatWest said it grew its lending by more than £8 billion over the third quarter, with the acquisition of Metro Bank helping bolster its mortgage book.
It also said the amount of money customers held with the bank increased by £2.2 billion, driven by more cash being put into savings.
Chief executive Paul Thwaite said: “With customer activity increasing, defaults remaining low and optimism amongst businesses and consumers, we are well placed to succeed with our customers and for our shareholders in the months and years ahead.”
Meanwhile, the lender said its business expenses were nearly £150 million lower than the previous three-month period, with Mr Thwaite continuing to oversee a simplification of the bank’s structure.
Nevertheless, NatWest revealed that it took a £24 million hit to costs in relation to the planned sale of its shares to retail investors.
The bank had been preparing for the share sale, including through an advertising campaign, which was proposed by the previous Conservative government but scrapped when Labour won the general election earlier this year.