Slide 1: 14 February 2025
14 February 2025
Slide 2: Paul Thwaite, Chief Executive Officer
NatWest UI 1 Paul Thwaite | Chief Executive Officer
Slide 3: Disciplined growth across our businesses
Disciplined growth across our businesses £372bn £431bn £48.9bn with ~500k1 new Customer Loans2 Customer Deposits3 AUMA customers +3.5% vs Dec’23 +2.9% vs Dec’23 +20% vs Dec’23 Strong returns with £14.6bn £7.9bn 17.5% attributable profit of Income ex notable items4 Costs5 Return on Tangible Equity £4
Slide 4: Progressing our strategic priorities
Creating shareholder value Progressing our Delivered on improved 2024 Guidance1 £4.0bn total distributions strategic priorities to shareholders3 2024 Guidance Result 9.7 8.8 8.0 Total income excluding ~£14.4bn £14.6bn notable items +37.2% 362 Disciplined growth Other operating Broadly stable 33 +1.1
Slide 5: Growing our customer base
➢ Growing our customer base: ~500k in 2024 to over 19 million ➢ 6th consecutive year of lending growth: 6 year CAGR 1 4.3% Loans, 4.1% Deposits, 10.8% AUMA Start-ups to large corporates Youth to mass affluent Affluent to high net-worth and financial institutions • + ~500k new customers2 • 26% increa
Slide 6: Delivered stable costs in 2024
➢ Delivered stable costs in 2024 mitigating inflation, with £76m property savings1 and 3.3% FTE reduction2 ➢ Investments in technology are improving the customer experience and colleague productivity Start-ups to large corporates Youth to mass affluent Affluent to high net-worth and financial instit
Slide 7: Focused on capital allocation and risk management
➢ Focused on capital allocation to drive optimal risk-adjusted returns: delivered 243bps of capital1 generation pre-distributions in 2024 ➢ £6.8bn RWA management savings through multiple levers ➢ Strong risk management evident in low impairment rate and low stage 3 loans 19bps 9bps 1.7% 1.4% £3.4bn
Slide 8: Katie Murray, Chief Financial Officer
NatWest UI = Katie Murray Chief Financial Officer
Slide 9: Group financial results
FY'24 vs Q4'24 vs Q4'24 vs Group, £m FY'24 FY'23 FY'23 Q4'24 Q3'24 Q4'23 Q3'24 Q4'23 Net interest income, ex notable items1 11,306 11,081 2.0% 2,999 2,899 2,670 3.4% 12.3% 1 Non-interest income, ex notable items 3,342 3,258 2.6% 873 873 772 0.0% 13.1% Total income, ex notable items 1 14,648 14,339 2
Slide 10: Net interest income and non-interest income
+2.2% Net interest income 14,648 Non interest income 14,339 65 Total centre income (18) 248 (263) 44 298 3,258 (65) 3,342 3 businesses +£244m, +1.7% NII -£30m, -0.3% 11,306 FY’23 NIM2: +1bps in FY’24 FY’24 Non-II +£274m, +8.9% 212bps • Lending margins -11bps 213bps • Deposit margins +2bps 11,081 • F
Slide 11: Loan growth
205.4 Mortgages 206.3 • Balance growth of +£1.6bn in FY’24, includes 207.0 £2.3bn Metro Bank portfolio • Stock share 12.6% as at Dec’241 15.8 Q4’23 Unsecured 16.6 Q3’24 16.8 Q4’24 • +£1.1bn in FY’24, 9.7% stock share2 4.5 Other Private 4.6 4.6 Business 1.9 2.0 Banking3 2.0 +£12.0bn, +9.4% • Social h
Slide 12: Customer deposits
Q4’23 66.1 121.9 188.0 Retail Q3’24 64.3 127.7 192.0 419 420 425 427 431 Banking +£2.8bn Q4’24 64.5 130.3 194.8 16% 17% 17% 17% 16% Q4’23 7.2 30.5 37.7 Private Q3’24 6.5 33.2 39.7 50% 51% 51% 51% 53% Banking +£2.7bn Q4’24 6.6 35.8 42.4 Q4’23 68.9 124.5 193.4 34% 33% Commercial 32% 32% 31% & Institut
Slide 13: Product structural hedge
Product hedge gross income Gross income already written as at Dec’24 +c.£1bn +£0.2bn • We now expect the product structural hedge income 3.0 in 2025 to be ~£1bn greater than 2024. • Beyond 2025, we expect annual growth in product 2.0 structural hedge income each year through to 2027. 3.4 3.5 • We ex
Slide 14: 2025 income drivers and guidance
2025 income drivers and guidance Growth across our customer businesses Active management of product pricing as interest rates fall Strong product structural hedge tailwind of ~£1bn In 2025 we expect income excluding notable items to be £15.2bn-£15.7bn Assumes UK Bank Rate of 3.75% at end 2025 14
Slide 15: Operating costs and 2025 guidance
+1.1% ~8.1bn 7,728 7,854 ~£0.1bn 7,641 275 157 (252) 58 124 83 126 ~8.0bn One-time integration costs Ulster direct costs Other operating expenses FY’23 Staff costs Other Premises Depreciation Increased FY’24 FY’25 administrative and and bank Guidance expenses equipment amortisation levies1 and retai
Slide 16: Loan impairment rate and FY'25 guidance
3,131 359 724 66 Q4’24 578 337 245 Q3’24 93 Q1’24 (45) Q2’24 (1,173) FY’19 FY’20 FY’213 FY’22 FY’23 FY’24 FY’25 Guidance Loan impairment Below 21 85 -32 9 15 9 rate2, bps 20bps Stage 3 loan 18 17 8 6 8 11 impairment rate4, bps ECL provision, £bn 3.8 6.2 3.8 3.4 3.6 3.4 of which Post Model Adjustment
Slide 17: Capital generation and CET1 ratio
243bps1 capital generation pre distribution in FY’24 218bps distributions in FY’24 15.8 (0.02) 0.10 (0.95) 2.34 (1.22) 13.6 13.4 FY’23 Attrib. profit1 RWAs Other CET1 CET1 ratio pre Ordinary Directed FY’24 changes distributions dividend Buybacks CET1 capital 2 24.4 +4.3 +0.2 -1.7 -2.2 24.9 £bn £190-
Slide 18: TNAV per share and dividends
+37p 26% 5 (17) 21.5 329 (4) 1 51 292 17.0 264 13.5 15.5 11.5 10.0 5.5 6.0 3.5 FY’22 FY’23 Attributable Cash flow Dividends Directed Other FY’24 FY’22 FY’23 FY’24 profit hedge buyback reserve Final dividend Interim dividend -£1.4bn balance as at end of FY’24, equivalent to -18p1 18
Slide 19: Summary of guidance
Summary of guidance! 2025 Guidance £15.2-15.7bn2 Other operating expenses ~£8.1bn, incl. ~£0.1bn one-time integration costs Loan impairment rate Below 20bps Risk Weighted Assets £190-195bn Return on Tangible Equity 15-16% 19
Slide 20: Paul Thwaite, Chief Executive Officer
NatWest UI 1 Paul Thwaite | Chief Executive Officer
Slide 21: Three customer businesses with strong market positions
Start-ups to large corporates Youth to mass affluent Affluent to high net-worth and financial institutions Multi-channel 18.1m customers1 0.1m customers2 1.5m customers3 brands serving our >19 million +67% Award winning ~20% customers share of UK start ups6 Rooster youth customers4 UK Private bank5
Slide 22: Strategic priorities
• Grow our three customer businesses, • Accelerate digitisation of customer • Leverage our strong capital, liquidity increasing total customer numbers, journeys with a focus on reducing and and funding positions as a key source including proportion banking digitally automating end to end processes o
Slide 23: Focused on returns and attractive distributions
Focused on returns Attractive distributions to shareholders Underpinned by a strong Balance Sheet 23
Slide 24: Appendix
a 7) ws A ae) BO z
Slide 25: Upcoming reporting dates
26th March 2025 25th June 2025 Q4 2025 25
Slide 26: Outlook
Outlook The following statements are based on our current expectations for interest rates and economic activity. We will monitor and react to market conditions and refine our internal forecasts as the economic position evolves. In 2025 we expect: - to achieve a return on tangible equity in the range
Slide 27: Group income and notable items
Q1'23 Q2’23 Q3'23 Q4'23 FY'23 Q1'24 Q2'24 Q3'24 Q4'24 FY'24 Group income 3,876 3,851 3,488 3,537 14,752 3,475 3,659 3,744 3,825 14,703 Notable items in Income, £m Q1'23 Q2’23 Q3'23 Q4'23 FY'23 Q1'24 Q2'24 Q3'24 Q4'24 FY'24 Commercial and Institutional Own credit adjustments (OCA) 6 3 (6) (5) (2) (5)
Slide 28: Group FY24 results by business
Retail Private Commercial & Central items Group FY24, £bn Group Banking Banking Institutional & other Net interest income 5.2 0.6 5.3 0.1 11.3 Non-interest income 0.4 0.3 2.6 0.1 3.4 Total income 5.7 1.0 8.0 0.1 14.7 Income ex-notable items 5.7 1.0 8.0 0.1 14.6 Other operating expenses (2.8) (0.7) (
Slide 29: Business performance
+7.2% -4.7% 5.9 7.4 8.0 5.7 Q4 1.4 -2.1% 1.8 +13.9% 2.1 +9.6% 1.5 1.0 1.0 9M 0.2 +30.1% 0.3 FY’23 FY’24 FY’23 FY’24 FY’23 FY’24 +10.8% -7.8% 3.6 2.6 3.2 +15.7% 2.4 -9.3% +18.8% 0.9 Q4 0.6 0.7 0.7 0.3 0.3 9M n.m. 0.1 0.0 FY’23 FY’24 FY’23 FY’24 FY’23 FY’24 -3.9ppt 23.8% 19.9% +1.8ppt -0.6ppt 17.2% 15
Slide 30: Loans, deposits and AUMA growth
+29%, +4.3% CAGR 350 359 372 301 324 328 289 Gross Loans to customers FY’181 FY’19 FY’20 FY’21 FY’22 FY’23 FY’24 +28% 4.1% CAGR 446 433 419 431 406 Customer deposits 338 348 FY’181 FY’19 FY’20 FY’21 FY’22 FY’23 FY’24 +85% +10.8% CAGR 49 AUMAs 36 41 30 32 33 26 30 FY’181 FY’19 FY’20 FY’21 FY’22 FY’23
Slide 31: Net interest income, AIEAs and NIM
2,899 2,968 2,638 2,651 2,757 Net interest income Q4’23 Q1’24 Q2’24 Q3’24 Q4’24 539 Group AIEAs 528 530 o.w. Liquid Asset Buffer 525 521 160 162 163 158 155 Q4’23 Q1’24 Q2’24 Q3’24 Q4’24 2.18% 2.19% 2.10% Group NIM1 2.05% 1.99% Q4’23 Q1’24 Q2’24 Q3’24 Q4’24 31
Slide 32: Deposit mix and hedge mix
Subject to customer and market dynamics +2.9% 431 431 419 419 16% 16% 69 69 Term deposits 68 Term 68 Term Deposit Income: • Volume: subject to customer behaviour • Margin: broadly stable Instant Access Unhedged Deposit Income: 50% 53% Unhedged 166 190 209 227 • Volume: subject to mix • Margin: decre
Slide 33: Deposit costs and managed margin
5.5 5.3 5.3 5.3 5.1 5.0 4.9 -50 -44 -41 4.5 4.0 3.5 3.1 3.1 3.1 -125 3.0 -142 2.9 3.0 -170 2.5 2.1 2.1 2.1 2.0 2.0 2.0 -169 -183 1.5 -220 1.0 Q4’23 Q1’24 Q2’24 Q3’24 Q4’24 FY’22 FY’23 FY’24 Average base rate Structural Hedge Average cost of interest bearing customer deposits across 3 businesses 2,3
Slide 34: Interest rate sensitivity
FY 2024 -25 basis points parallel downward shift +25 basis points parallel upward shift Year 1 Year 2 Year 3 Year 1 Year 2 Year 3 (£m) (£m) (£m) (£m) (£m) (£m) Structural Hedge (41) (125) (212) 41 125 212 Managed Margin (142) (120) (125) 121 116 124 Total (183) (245) (337) 162 241 336 H1 2024 -25 ba
Slide 35: Asset and funding rates by business
6.81 Retail Banking 7.0 6.65 6.73 6.67 6.36 Private Banking 6.5 Commercial & Institutional 6.0 5.22 NatWest Group 5.5 4.97 5.01 5.01 5.0 4.88 4.50 4.67 4.75 4.84 4.76 4.5 3.79 3.97 4.09 4.21 4.0 3.5 3.50 0.0 Q4’23 Q1’24 Q2’24 Q3’24 Q4’24 3.14 3.15 3.16 3.2 3.06 3.02 Retail Banking 3.0 Private Bankin
Slide 36: Structural hedge income
FY 2024 Period end Total Income Average Notional Total Yield notional (£m) (£bn) (£bn) % Equity 440 22 22 1.98 Product 3,039 172 174 1.75 Total 3,479 194 196 1.77 H1 2024 Period end Total Income Average Notional Total Yield notional (£m) (£bn) (£bn) % Equity 218 22 22 1.95 Product 1,392 175 176 1.58
Slide 37: TNAV per share reconciliation
GBP, m Share count, m Pence As at 30 September 2024 26,220 8,293 316 Directed share buyback (executed on 11 November 2024) (1,000) (263) (2) Attributable profit 1,248 15 Cash flow hedge reserve (net of tax) (78) (1) FX movements (net of tax) 122 1 Other movements (30) 13 (1) Net change 262 (250) 13
Slide 38: Economic scenario weightings and assumptions
FY'24 H1'24 FY'23 Upside Base Case Downside Extreme Upside Base Case Downside Extreme Upside Base Case Downside Extreme Scenario downside downside downside Weighting Weighted Weighted 23% 45% 19% 13% 22% 45% 19% 14% 21% 45% 20% 13% Weighted average average average UK GDP – Annual Growth (%) 2025 2.0
Slide 39: Loan book composition
Personal: £226.5bn, 55% of group Wholesale: £183.7bn, 45% of group Group mortgages £209.8bn Corporate and other ex CRE £93.6bn 51% of the group lending 23% of the group lending Loan-to-value of 56%1 stable year-on-year Diverse corporate loan book, with exposure across a broad range of sectors 63% 5Y
Slide 40: Mortgage book
203 208 210 Number of UK mortgages >3 months in arrears 177 188 21 21 21 160 17 17 0.91% 0.91% 0.93% 17 0.78% 0.83% 0.71% 171 182 187 189 0.66% 0.64% 0.63% 143 160 0.62% 0.58% 0.53% 57 56 54 53 55 56 FY’19 FY’20 FY’21 FY’22 FY’23 FY’24 FY’19 FY’20 FY’21 FY’22 FY’23 FY’24 Buy-to-let Mortgage Book, £b
Slide 41: Commercial real estate and social housing lending
+14.0% 10,801 9,474 gross lending Stable credit quality, very limited £7.5bn gross lending to the UK social instances of specific cases deteriorating housing sector between 1 January 2024 and 31 December 20261 Exposure to the Retail and Office sector is geographically diversified across all FY’23 FY
Slide 42: ECL coverage and provisions
0.93% 0.83% ECL coverage, % 35.23% 34.40% Stage 3 ECL coverage, % -126 3,645 699 -600 -18 -58 -117 3,425 429 56 299 Economic uncertainty PMA 37 Other PMA 1,935 Stage 3 ex PMA 2,032 Stage 2 ex PMA Stage 1 ex PMA 736 625 489 432 FY’23 Transfers to Changes in Changes in Changes in risk Judgemental Writ
Slide 43: Impairment charge by business
Retail Private Commercial Central items Group Banking Banking & Institutional & other FY'24 (£m) 282 (11) 98 (10) 359 FY'24 (bps) 13bps (6)bps 7bps nm 9bps FY’23 (£m) 465 14 94 5 578 FY’23 (bps) 22bps 8bps 7bps nm 15bps Q4’24 (£m) 16 3 46 1 66 Q4’24 (bps) 3bps 7bps 13bps nm 7bps Q3’24 (£m) 144 (3) 1
Slide 44: Capital and leverage requirements
5.00% 13.6% 152% 150% 4.25% 144% 11.7% 0.40 3.85% 1.2% 10.5% 0.60 Min. 1.7% MDA2 Requirement 2.5% 1.8% 3.25 4.5% FY’24 Regulatory FY’24 Regulatory FY’19 FY’23 FY’24 requirement requirement O-SII group risk add-on2 Pillar 2A4 O-SII group risk add-on2 Countercyclical buffer3 Pillar 1 Countercyclical l
Slide 45: Total capital requirements
19.7% Tier 2 3.2% 15.4% AT1 3.5 2.9% Tier 2 2.8% AT1 1.0 1.0 0.6 2.1% 2025 2026 2027 2028 onwards CET1 13.6% CET1 10.5% CET1 2.3 2.0 1.0 Total Capital FY'24 2024 Total capital requirement 2025 2027 2028 onwards 45
Slide 46: MREL requirements
33.0% MREL + Buffer 27.9% 1.2% O-SII Group Risk Add-on4 1.7% Countercyclical buffer5 2.5% Capital conservation buffer 2 x Pillar 2A3 6.5% 22.5% Senior MREL & MREL MREL eligible requirement CET1, AT1, 12.5 Tier 2 capital 2 x Pillar 1 resources 2 x Pillar 1 16% 4.9 3.2 3.7 MREL FY'24 2024 MREL require
Slide 47: Liquidity and funding
152% 150% 145% 144% 232.6 222.8 222.3 199.4 63.9 61.2 74.7 74.4 26.6 48.2 72.4 50.6 142.0 99.9 88.6 74.3 FY'19 FY'22 FY'23 FY'24 FY'19 FY'22 FY'23 FY'24 Cash Securities Secondary liquidity 47
Slide 48: Liquidity pool composition
3% 6% 3% 24% 19% 37% £161.0bn £88.6bn £72.4bn 55% 59% 19% 76% GBP EUR GBP EUR USD Other Cash and balances at central banks Level 1 government & SSA bonds Level 1 covered bonds Level 2 eligible assets 48
Slide 49: 2024 funding issuance
Group holding company 2024 guidance 2024 issuance • $1.0bn 4NC3 FXD • $0.3bn 4NC3 FRN • $1.5bn 11NC10 FXD • $0.5bn 4.25NC3.25 FRN Senior unsecured (MREL) £4bn to £5bn ~£4.8bn • $1.25bn 6NC5 FXD • €0.75bn 7NC6 FXD NatWest Group plc • €1.0bn 8NC7 FXD • $1.0bn 10.25NC5.25 Tier 2 capital £1bn to £2bn ~£
Slide 50: 2025 funding guidance
Group holding company 2025 guidance • Expect to be active across multiple currencies and tenors. Senior unsecured (MREL) £4bn to £5bn • Issuance across all asset classes driven by re- NatWest Group plc financing of maturing or callable securities and RWA growth. Tier 2 capital ~£1bn • AT1 call optio
Slide 51: Footnotes
Slide 3: 1. Net new customers excluding RBS Collective Investment Funds Limited (CIFL) solo customers. 2. Gross loans across 3 businesses. 3. Customer deposits across 3 businesses. 4. Excludes notable items per slide 27. 5. Costs excluding litigation and conduct. Slide 4: 1. Guidance was updated at
Slide 52: Footnotes
Slide 35: 1. For NatWest Group plc this is the gross yield on the IEAs of the banking business; for Retail, Commercial & Institutional and Private it represents the third-party customer asset rate. 2. For NatWest Group plc this is the cost of interest- bearing liabilities of the banking business plu
Slide 53: Forward-looking statements
Forward-looking statements The guidance, targets, expectations and trends discussed in this presentation represent NatWest Group management’s current expectations and are subject to change, including as a result of the factors described in the “Risk Factors” in the NatWest Group plc 2024 Annual Repo