25th Jul 2025 08:43
(Alliance News) - NatWest Group PLC on Friday raised its full-year guidance, and boosted its dividend, after a strong first half which saw loans and deposits grow.
The Edinburgh-based lender reported operating pretax profit of GBP3.59 billion in the six months to June 30, rising 18% from GBP3.03 billion the year before.
Net interest income grew 13% to GBP6.12 billion from GBP5.41 billion, while non-interest income improves 8.1% to GBP1.87 billion from GBP1.73 billion. Net interest margin is 2.28%, improved on-year from 2.07%.
For the second quarter of 2025, operating pretax profit fell 2.2% to GBP1.77 billion from GBP1.81 billion a year ago, while net interest income rose 2.0% up to GBP3.09 billion from GBP3.03 billion.
The bank said its return on tangible equity for the six-month period was 18.1% against 16.4% the year before. The cost income ratio fell to 48.8% from 55.5% a year ago.
Impairments rose to GBP382 million in the half-year from GBP48 million a year ago.
In response, shares in NatWest rose 1.6% to 509.60 pence each in London on Friday morning. The wider FTSE 100 was down 0.3%.
NatWest said it attracted 1.1 million new customers in the first half of 2025, both organically and through the Sainsbury's Bank transaction which completed in May.
Net loans to customers excluding central items increased 2.2% to GBP380.1 billion from GBP371.9 million from the prior quarter. This includes GBP2.2 billion of balances acquired from Sainsbury's Bank.
Customer deposits excluding central items increased 0.6% to GBP435.8 billion from GBP433.4 billion in the prior quarter, including GBP2.4 billion of balances acquired from Sainsbury's Bank.
NatWest declared an interim dividend of 9.5 pence per share, up 58% on-year from 6p, and intends to launch a share buyback for GBP750 million in the second half of 2025.
"With positive momentum in our business, we are ambitious for the future and see clear opportunities for further disciplined growth," said Chief Executive Officer Paul Thwaite.
"Having returned to full private ownership in Q2 2025, NatWest Group is well placed to step up and play its part in supporting economic growth across the UK and, in doing so, to create sustainable value for all our stakeholders," he added.
NatWest announced it had returned to full private ownership at the end of May, after the government sold its remaining shares in the bank.
For 2025, NatWest said it expects income excluding notable items to be greater than GBP16.0 billion. It had previously guided to the top end of a GBP15.2 to GBP15.7 billion range.
The lender anticipates a return on tangible equity of more than 16.5% compared to the top-end of a 15% to 16% range before.
NatWest continues to target a CET1 ratio between 13% and 14%. Its first-half CET1 ratio was 13.6% in the first half of 2025, versus 13.8% in the first half of 2024.
By Jeremy Cutler, Alliance News reporter
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