Natwest Group Plc · LSE:NWG
Natwest — Q3 2019 Earnings Presentation
11 slides from Natwest's earnings presentation, Oct 24, 2019
Slide 1: Q3 2019 Results
Q3 2019 Results 24th October 2019
Slide 2: Q3 2019 update on progress
Q3 2019 update on progress(1) • 3.2% YTD annualised net loan growth across Personal & Net loan growth Ulster and Commercial & Private • Targeting 2-3% net loan growth in 2019 • Reduced other expenses by £193m YTD Continuing cost reduction • Targeting cost reduction of £300m in 2019 • CET1 ratio at 1
Slide 3: Q3 2019 summary financials
Q3 2019 summary financials Income Ex Total One-offs Other one-offs(2) Alawwal Income Q3’18 vs. Q3’19 Q3’19 vs. Q3’19 vs. (£m) £m Q3’19 Q3’18 Q2’19 3,642 (3%) Net interest income 2,006 (7%) 2% 2,903 359 (416) (84) (5) 178 (53) Non interest income 897 (40%) (57%) Total income 2,903 (20%) (29%) 3,283 2
Slide 4: Bank Net Interest Margin Q3 2019 vs. Q2 2019
Bank Net Interest Margin Q3 2019 vs. Q2 2019 Bank NIM (bps) 202 0 Future (5) considerations (1) 196 197 1 • Rate sensitivity • Reduction in liquidity • Asset and liability pressures • Economic uncertainty Q2’19 Central Competitive Other Q3’19 One-offs Q3’19 liquidity pressure AIEAs (1) £410.4bn £415
Slide 5: Net loan growth
Net loan growth UK Personal Banking Gross L&A Growth (£bn) +3.9% Q3’19 YTD annualised net loan growth(1) +3.6% 150.0 155.9 138.4 143.4 2019 target net 2% – 3% loan growth (2) +10.5% +2.5% Q3’19 YTD 7.6 8.4 annualised 3.2% 4.0 4.1 net loan FY18 Q3’19 FY18 Q3’19 Personal FY18 Q3’19 FY18 Total Q3’19 Ca
Slide 6: Capital generation
Capital generation CET1 (%) 16.0 (0.5) 0.3 0.0 (0.1) 15.7(1) (0.1) c.14% Q2’19 PPI Profit ex. PPI Dividends RWAs Other Q3’19 FY 2021 Target 16.0 0.9 15.7(1) 0.6 (0.5) (1.1) (0.4) 0.1 c.14% Pro-forma Alawwal profit & PPI Profit (ex. Dividends RWAs ex Other Q3 2019 FY 2021 Q4’18 RWA reduction Alawwal
Slide 7: Economic outlook has become more challenging
Economic outlook has become more challenging Overnight Index Swaps Rates (1) 2020 Consensus GDP Growth Estimates (2) 1.25 2.0 1.00 Dec 18 Mar 19 1.5 0.75 Jun 19 % % 1.0 0.50 Sep 19 1.6 1.6 1.4 0.5 1.1 0.25 0.00 0.0 2019 2020 2021 2022 2023 2024 Jan-19 Mar-19 Jun-19 Sep-19 UK and Europe - Key Rates (
Slide 8: Notable items
Notable items (£m) Q3 2019 Q2 2019 Q1 2019 FY 2018 Q4 2018 Q3 2018 Q2 2018 Q1 2018 Alawwal Bank merger gain on disposal - 444 - - - - - - FX recycling gain - 290 - - - - - - Provisions release - 256 - - - - - - Other Strategic Disposals - 45 - - - - - - IFRS volatility in Central items (51) 21 (4) (
Slide 9: Q3 2019 results by business
Q3 2019 results by business(1) Central Commercial Private NatWest (£bn) UK PB Ulster Bank RoI RBS International items & Total RBS Banking Banking Markets other(2) Income 1.2 0.1 1.1 0.2 0.2 0.2 (0.0) 2.9 Operating expenses (1.6) (0.1) (0.6) (0.1) (0.1) (0.3) 0.2 (2.7) Impairment (losses) / releases
Slide 10: Net Promoter Scores across our brands
Net Promoter Scores across our brands Personal Banking(1) Business Banking(2) Commercial Banking(3) NatWest is stable while Royal Bank of NatWest stable. NatWest No 1 in the market. Scotland continues to improve. Improvement for Royal Bank. 30 25 25 27 27 25 23 23 22 21 21 20 20 20 13 15 13 12 12 12
Slide 11: Cautionary & forward looking statements
Cautionary & forward looking statements The targets, expectations and trends discussed in this presentation represent RBSG, and where applicable NWM management’s, current expectations and are subject to change, including as a result of the factors described in the “Summary Risk Factors” on pages 46