13th Feb 2026 09:31
(Alliance News) - NatWest Group PLC on Friday reported improved full-year and fourth-quarter earnings, with its total dividend rising by 51% and a timeline outlined for its GBP750 million buyback scheme.
The Edinburgh-based lender reported GBP16.64 billion in total income for 2025, up 13% from GBP14.70 billion in 2024 and ahead of analyst consensus of GBP16.53 billion.
Segmentally, Retail Banking reported a 15% gain in total income to GBP6.50 billion, while Private Banking & Wealth Management saw total income increase 17% to GBP1.31 billion from GBP969 million.
For Commercial & Institutional, total income was 11% higher at GBP8.81 billion, while Central Items & Other edged up 62% to GBP206 million.
Net interest income grew 14% to GBP12.83 billion from GBP11.28 billion, and non-interest income advanced 11% to GBP3.81 billion.
Operating pretax profit increased 24% to GBP7.71 billion from GBP6.20 billion, also surpassing consensus estimates, which had pencilled in a rise to GBP7.49 billion.
Operating expenses rose 1.4% to GBP8.26 billion from GBP8.15 billion.
The bank's CET1 ratio at December 31 was 14.0%, rising from 13.6% a year prior. The CET1 ratio compares a bank's capital against its risk assets, with a higher ratio being more financially sound.
For the fourth quarter of 2025, NatWest posted a 13% gain in total income to GBP4.32 billion from GBP3.83 billion a year earlier, surpassing consensus estimates of GBP4.21 billion.
Net interest income advanced 16% to GBP2.97 billion, while non-interest income grew 3.0% to GBP883 million from GBP857 million.
Divisionally, Retail Banking saw total income rise 13% to GBP1.66 billion, and in Private Banking & Wealth Management it grew 13% to GBP308 million.
Total income for Commercial & Institutional advanced 11% to GBP2.31 billion, and in Central items & other it improved to GBP178 million from a GBP34 million loss
Pretax profit rose 30% to GBP2.18 billion from GBP1.49 billion in the fourth quarter, beating consensus estimates of GBP1.79 billion.
Operating expenses fell 12% to GBP2.00 billion from GBP2.27 billion.
The lender proposed a final dividend of 23.0 pence per share, up 48% from 15.5p a year earlier. This brings its total dividend for 2025 to 32.5p, up 51% from 21.5p.
Looking ahead to 2026, Natwest guided total income excluding notable items between GBP17.2 billion and GBP17.6 billion. Operating expenses, excluding litigation and conduct costs are anticipated at around GBP8.2 billion.
NatWest also guided a return on tangible equity target for 2026 of greater than 17%. For 2028, it expects return on tangible equity of over 18%. At the bank's interims in July last year, it guided a return on tangible equity target for 2027 of greater than 15%.
The lender also plans to commence a GBP750 million buyback programme in the first half of 2026, with the repurchase intention initially announced on Monday in parallel with its GBP2.7 billion acquisition of wealth management firm Evelyn Partners.
The lender is buying Evelyn from funds advised by private equity firms Permira and Warburg Pincus. In NatWest's view, the deal creates the UK's "leading" private banking and wealth-management business.
The London-based firm brings GBP69 billion in assets under management and administration to NatWest, taking their combined total to GBP127 billion.
The acquisition is slated to close over the summer, subject to approval, with Ardea Partners International LLP, Bank of America Securities Inc and UBS Group AG acting as advisors to NatWest.
Shares in NatWest were down 0.9% at 589.69 pence on Friday morning in London.
"2025 was another strong year for NatWest group, rooted in the support we provide to people, families and businesses in every nation and region of the UK. We delivered broad-based growth across our three customer businesses, and our positive impact is clear to see; whether making home ownership a reality for more people, helping more customers to save and invest or supporting more businesses to scale and grow," said Chief Executive Paul Thwaite.
"It is clear our strategy is working, and we are delivering consistently. We are raising our ambition and sharpening our strategic focus, with stretching new targets in place. We must now make the most of the investment we've made to become even more productive, build deeper customer relationships and ensure we are the bank of choice in the areas we want to grow."
By Christopher Ward, Alliance News reporter
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