NatWest Group Q2 Earnings Call Highlights

NatWest Group NYSE: NWG reported higher second-quarter income and profit, supported by broad-based lending growth, higher non-interest income and continued operating leverage, while raising its 2026 return-on-tangible-equity guidance to more than 19%. Chief Financial Officer Katie Murray said the bank’s first-half results reflected progress toward its 2028 targets for customer growth, efficiency, capital generation and returns. NatWest reported a first-half return on tangible equity of 19.7%, while its second-quarter return on tangible equity reached 21%. “Our performance makes clear we have the capability and capacity to grow at scale,” Murray said, citing growth across the group’s three businesses, improving efficiency and low credit losses. Second-quarter income excluding notable items increased 5.4% from the first quarter to £4.4 billion. Total operating costs increased 1.8% to £2.1 billion, producing a one-percentage-point improvement in the cost-income ratio to 45.5% for the quarter. Operating profit rose 12.4% to £2.3 billion, while profit attributable to ordinary shareholders was £1.6 billion. Non-interest income increased 15%, or £124 million, during the quarter. For the first half, NatWest said income growth of 8.9% exceeded cost growth of 4.5%, reducing the cost-income ratio by 2.8 percentage points to 46%. Murray said the group now expects other operating expenses of about £8.5 billion for the full year. Second-quarter income excluding notable items: £4.4 billion Second-quarter operating profit: £2.3 billion Second-quarter profit attributable to ordinary shareholders: £1.6 billion First-half cost-income ratio: 46% First-half return on tangible equity: 19.7% Customer assets and liabilities increased by £86.8 billion, or 9.6%, in the second quarter to £986.9 billion. The increase included £9.7 billion in customer lending growth, £2.8 billion in deposit growth and a £73.9 billion rise in assets under management and administration, including the acquisition of Evelyn Partners. NatWest said its acquisition of Evelyn Partners had completed, adding exposure to the U.K. wealth-management market. Assets under management and administration totaled £130.6 billion at quarter-end, including £71.7 billion from Evelyn Partners. The total also reflected a £4 billion reduction related to the sale of Cushon in May. Loans in Retail Banking and Private Banking and Wealth Management rose £4 billion, including £3.9 billion of mortgage growth. NatWest’s mortgage stock share increased to 12.7%, with Murray citing record applications in March. Commercial and Institutional lending increased £5.7 billion, with the strongest growth among larger corporates and institutions. Customer deposits rose £2.8 billion during the quarter, led by a £2.5 billion in.