Natwest Group Plc · LSE:NWG
Natwest — Q2 2025 Earnings Presentation
42 slides from Natwest's earnings presentation, Jul 25, 2025
Slide 1: NatWest Group H1 2025 Results
NatWest Gro Hi 2025 Results 25 July 2025
Slide 2: Paul Thwaite, Chief Executive Officer
NatWest Gro Paul Thwaite Chief Executive Officer
Slide 3: Disciplined growth across our businesses
£384bn £436bn £52bn Disciplined growth across our businesses Customer Loans1 Customer Deposits2 AUMA +3.2% vs Dec’24 +1.0% vs Dec’24 +5.9% vs Dec’24 Strong returns with £8.0bn £3.9bn 18.1% attributable profit of Income ex notable items3 Costs4 Return on Tangible Equity £2.5bn +13.7% vs H1’24 -1.4% v
Slide 4: Leading positions in an attractive UK market serving >20m customers
Leading positions in an Attractive returns attractive UK market Creating shareholder value to shareholders serving >20m customers 8.3 8.0 8.1 Disciplined growth Shareholder returns H1’25 +15.6% 351 Bank-wide simplification Share buyback 329 9.5 announced 304 15.5 6.0 Active balance sheet and risk ma
Slide 5: 1.1 million customers added to over 20 million
1.1 million customers added including >100k Productivity and efficiency improvements: Strong capital, liquidity and funding: organic, to over 20 million cost:income ratio 6.7%pt lower vs H1’24 13.6% CET1 ratio, 5.0% Leverage ratio, 147% LCR, 86% Loan to deposit ratio Digitising our customer journeys
Slide 6: NatWest Group H1 2025 Results July 2025
NatWest Group H1 2025 Results July 2025 6
Slide 7: Katie Murray, Chief Financial Officer
) # Katie Murray x! , Chief Financial Officer r
Slide 8: Group financial results, £m
Q2'25 vs H1'25 vs Group, £m Q2'25 Q1'25 Q1'25 H1'25 H1'24 H1'24 1 Net interest income, ex notable items 3,094 3,026 2.2% 6,120 5,408 13.2% 1 Non-interest income, ex notable items 916 926 (1.1%) 1,842 1,596 15.4% 1 Total income, ex notable items 4,010 3,952 1.5% 7,962 7,004 13.7% Total income 4,005 3
Slide 9: Net interest income and total income
Net interest income Non interest income Total centre income +1.5% 21 8 8 (23) (18) 4,010 4,005 3,980 30 (1) (5) (28) 3,952 34 916 911 954 926 3 businesses +£43m, +1.1% NII +£50m, 1.6% Non-II -£7m, -0.8% 3,094 3,094 3,026 3,026 Q1’25 Notable Q1’25 ex Daycount Retail Private Commercial Central Q2’25 e
Slide 10: Customer loans by business
207.0 Mortgages 209.1 Q4’24 • Balance growth of +£1.3bn in Q2’25 210.4 Q1’25 • Stock share 12.6%1, stable YTD Q2’25 16.8 Unsecured 16.9 Unsecured: 19.6 • +£2.2bn balances from Sainsbury's Bank, incl. £1.2bn of Personal advances and 4.6 £1.0bn of Credit Cards Other Private 4.7 • Credit card share of
Slide 11: Customer deposits by business
431 433 436 Q4’24 64.5 130.3 194.8 Retail Banking2 Q1’25 195.7 16% 16% 17% 65.7 130.0 +£0.9bn Q2’25 64.2 132.4 196.6* 53% 53% 53% Private Q4’24 6.6 35.8 42.4 Banking & Q1’25 6.5 34.7 41.2 Wealth +£0.1bn Management Q2’25 6.3 35.0 41.3 31% 31% 31% Q4’24 63.9 130.2 194.1 Commercial Q1’25 62.6 133.9 196
Slide 12: Product structural hedge income
>£1bn Product hedge gross income Gross income already written as at Jun’25 +£1bn +£0.2bn • We continue to expect the product structural hedge notional to be broadly stable in 2025, with annual maturities of ~£35bn 4.0 4.2 3.8 • Based on our assumptions for reinvestment yield 2.8 3.0 and stable notio
Slide 13: Operating expenses
+1.6% +0.9% -0.1% +1.3% 1,965 1,935 -0.6% 25 27 (11) 17 (1) Bank levies 55 7 One-time integration costs Other operating expenses • 3.3% average annual wage increase and higher National Insurance Contributions from April Q1’25 Staff costs Other Premises and Depreciation Q2’25 • 2.3% lower FTE H1’25 v
Slide 14: Impairments and ECL
245 189 193 Day 1 ECL Sainsbury's ECL3 Provision £3.7bn 81 Bank 66 112 Includes PMA release ECL3 Coverage 0.87% of c.£64m PMA4 for Economic uncertainty £234m -45 Q2’24 Q3’24 Q4’24 Q1’25 Q2’25 Stage 3 as % of loans 1.4% Q2'25 excl Q2'24 Q3'24 Q4'24 Q1'25 Q2'25 Sainsbury's Bank FY’25 Retail Banking 12
Slide 15: CET1 capital and RWAs
53bps1 capital generation pre distribution in Q2’25 (0.15) 14.3% (0.12) 0.11 0.69 (0.33) 13.8% (0.39) 13.6% Q1’25 Attrib. profit1 Sainsbury’s RWAs1 Other CET1 CET1 ratio pre Ordinary Buyback Q2’25 Bank changes distributions dividend CET1 capital2 25.7 +1.3 -0.1 +0.2 -0.6 -0.8 25.8 £bn +£3.1bn £190-1
Slide 16: Previous guidance, H1'25 progress, strengthened guidance
Previous guidance H1’25 Progress Strengthened guidance Income excluding notable items Other operating expenses Loan impairment rate ROTE RWAs NatWest Group H1 2025 Results July 2025 16
Slide 17: Q&A
Q&A
Slide 18: Financial calendar and slides
25th June 2025 26th March 2025 Cursor with solid fill Slides 25th June 2025 Cursor with solid fill 25th November 2025 Slides Slides NatWest Group H1 2025 Results July 2025 18
Slide 19: Outlook
Outlook The following statements are based on our current expectations for interest rates and economic conditions. We recognise increased global economic uncertainty and will monitor and react to market conditions and refine our internal forecasts as the economic position evolves. In 2025 we expect:
Slide 20: Group income and notable items
Q2'24 Q3'24 Q4'24 FY'24 Q1'25 Q2'25 Group income 3,659 3,744 3,825 14,703 3,980 4,005 Notable items in Income, £m Q2'24 Q3'24 Q4'24 FY'24 Q1'25 Q2'25 Commercial and Institutional Own credit adjustments (OCA) (2) 2 (4) (9) 6 (3) Tax interest on prior periods (Net Interest Income) -- -- -- -- -- -- Ce
Slide 21: Tangible net asset value movement
GBP, m Share count, m Pence As at 31 March 2025 28,025 8,067 347 Attributable profit 1,236 15 Final ordinary dividend (paid 28 April 2025) (1,250) (15) Cash flow hedge reserve (net of tax) 343 4 Other movements 62 21 (0) Net change 391 21 4 As at 30 June 2025 28,416 8,088 351 15 (15) 351 347 4 Q1’25
Slide 22: Segment results Q2'25
Retail Private Banking & Commercial & Central items Group Q2'25, £bn 2 Group Banking Wealth Management Institutional & other Net interest income 1.5 0.2 1.5 (0.1) 3.1 Non-interest income 0.1 0.1 0.7 0.1 0.9 Total income 1.6 0.3 2.1 (0.0) 4.0 Income ex-notable items 1.6 0.3 2.2 (0.0) 4.0 Other operat
Slide 23: Net interest income, AIEAs and NIM
2,968 3,026 3,094 2,757 2,899 Net interest income Q2’24 Q3’24 Q4’24 Q1’25 Q2’25 Group AIEAs 542 543 o.w. Liquid Asset Buffer 539 528 530 163 164 161 160 162 Q2’24 Q3’24 Q4’24 Q1’25 Q2’25 Group NIM1 2.27% 2.28% 2.18% 2.19% 2.10% NatWest Group H1 2025 Results Q2’24 Q3’24 Q4’24 Q1’25 Q2’25 July 2025 23
Slide 24: Deposit mix and hedge mix
Subject to customer and market dynamics +1.0% 431 436 431 436 16% 17% Term deposits 69 73 Term 69 73 Term Deposit Income: • Volume: subject to customer behaviour • Margin: broadly stable Instant Access Unhedged Deposit Income: 53% 53% Unhedged 190 191 227 229 • Volume: subject to mix • Margin: decre
Slide 25: Deposit costs and interest rate sensitivity
5.5 5.3 5.1 5.0 4.9 (42) (41) (40) 4.6 4.5 4.5 4.0 3.5 3.1 3.1 2.9 (125) 3.0 2.7 2.6 (142) (136) 2.5 2.1 2.1 2.0 1.9 2.0 1.8 1.5 (167) (176) (183) 1.0 Q2’24 Q3’24 Q4’24 Q1’25 Q2’25 H1’24 FY’24 H1’25 Average base rate Structural Hedge Average cost of interest bearing customer deposits across 3 busine
Slide 26: Interest rate sensitivity
H1 2025 -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 (40) (125) (213) 40 125 213 Managed Margin (136) (97) (98) 118 101 116 Total (176) (222) (311) 158 226 329 FY 2024 -25 basi
Slide 27: Structural hedge income and yield
H1 2025 Period end Total Income Average Notional Total Yield notional (£m) (£bn) (£bn) % Equity 216 22 22 2.01 Product 1,900 172 171 2.24 Total 2,116 194 193 2.21 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
Slide 28: Lending and deposit margins by business
7.0 6.73 6.67 Retail Banking 6.36 6.24 6.5 Private Banking & Wealth Management 6.00 6.0 Commercial & Institutional 5.22 NatWest Group 5.5 5.01 5.01 4.83 5.0 4.74 4.75 4.84 4.76 4.73 4.69 4.5 3.97 4.32 4.0 4.21 4.29 4.09 0.0 Q2’24 Q3’24 Q4’24 Q1’25 Q2’25 3.15 3.16 Retail Banking 3.2 3.06 2.90 Private
Slide 29: Economic scenarios and weightings
H1'25 FY'24 H1'24 Upside Base Case Downside Extreme Upside Base Case Downside Extreme Upside Base Case Downside Extreme Scenario downside downside downside Weighting Weighted Weighted Weighted 21.7% 45.0% 20.7% 12.6% 23.2% 45.0% 19.1% 12.7% 22.0% 45.0% 19.4% 13.6% average average average UK GDP – An
Slide 30: Personal and wholesale lending
Personal: £232.9bn, 56% of group Wholesale: £185.0bn, 44% of group Group mortgages £213.3bn Corporate and other ex CRE £94.4bn 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 62% 5Y
Slide 31: Corporate credit exposure reflects the broader UK economy
Corporate credit exposure reflects the broader UK economy Source: NWG Pillar 3 H1 20251 Other Agriculture Human health & social 3% 4% • Portfolio quality remains robust, coverage 4% 8% Manufacturing levels remain appropriate Administration 8% • Portfolio is weighted towards service sectors at Electr
Slide 32: UK mortgage book
203 208 210 213 Number of UK mortgages >3 months in arrears 177 188 21 21 21 21 160 17 17 0.91% 0.91% 0.91% 17 0.89% 0.78% 0.83% 0.71% 171 182 187 189 192 0.66% 0.64% 143 160 0.62% 0.63% 0.63% 0.58% 0.53% 57 56 54 53 55 56 56 FY’19 FY’20 FY’21 FY’22 FY’23 FY’24 H1’25 FY’19 FY’20 FY’21 FY’22 FY’23 FY
Slide 33: Impairment charge by business
Private Banking & Commercial & Central items & Retail Banking Wealth Group Institutional other Management Q2'25 (£m) 117 - 76 - 193 Q2'25(bps) 22bps 0bps 20bps nm 19bps Q1'25 (£m) 109 1 78 1 189 Q1'25(bps) 21bps 2bps 22bps nm 19bps Q2'24 (£bn) 59 (5) (96) (3) (45) Q2'24 (bps) 12bps (11)bps (28)bps n
Slide 34: ECL coverage and movements
0.83% 0.87% ECL coverage, % 34.40% 38.83% Stage 3 ECL coverage, % (67) 3,650 3,425 404 (176) 81 10 (27) 35 234 Economic uncertainty PMA 37 299 Other PMA Stage 3 ex PMA 2,032 2,261 Stage 2 ex PMA Stage 1 ex PMA 625 604 432 516 FY’24 Acquisitions Changes in Changes in Changes in Judgemental Write-offs
Slide 35: CET1 and leverage requirements
13.6% 11.7% O-SII group risk add-on3 5.0% 10.5% 1.2% MDA2 1.7% Countercyclical buffer4 4.3% 0.4% O-SII group risk add-on3 Capital conservation buffer 2.5% 0.6% Countercyclical leverage ratio buffer6 Pillar 2A5 1.8% 3.25% Minimum Tier 1 capital Pillar 1 requirement 4.5% H1'25 Requirement H1'25 Requir
Slide 36: Total capital requirements
19.7% Tier 2 3.0% £5.7bn AT1 15.4% 4.0 3.1% £6.0bn Tier 2 2.8% 1.0 AT1 0.6 2.1% 2026 2027 2028 onwards CET1 13.6% CET1 £25.8bn 10.5% 3.1 2.0 1.0 H1’25 Total 2025 Total Capital 2025 2027 2028 onwards Capital requirement NatWest Group H1 2025 Results July 2025 36
Slide 37: MREL requirements
32.4% MREL + Buffer 27.7% 1.2% O-SII Group Risk Add-on4 1.7% Countercyclical buffer5 2.5% Capital conservation buffer Senior MREL 2 x Pillar 2A3 15.3 & MREL 6.3% eligible CET1, AT1, Tier 2 capital 22.3% resources MREL requirement 4.7 2 x Pillar 1 3.4 1.9 16% 2025 2026 2027 2028 onwards MREL H1'25 20
Slide 38: Liquidity portfolio and LCR
232.6 222.8 222.3 216.6 199.4 63.9 74.7 61.2 56.0 74.4 26.6 Other (Level 2) 48.2 72.4 74.0 50.6 Covered 11% 142.0 bonds 99.9 88.6 86.6 74.3 6% 73% FY’19 FY’22 FY’23 FY’24 H1’25 Cash Securities Secondary Liquidity £74.0bn 27% 157% Government & 152% HTC FVOCI 151% 150% 151% 150% SSA3 bonds 145% 144% 1
Slide 39: 2025 funding guidance and issuance
Group holding company 2025 guidance 2025 issuance1 • €1.25bn 5NC4 • €1.25bn 11NC10 Social Senior unsecured (MREL) £4bn to £5bn ~£3.3bn • $300m 4NC3 FRN • $1.25bn 6NC5 FXD NatWest Group plc Tier 2 capital ~£1bn ~£0.9bn • €1.0bn 10NC5 Additional Tier 1 ~£1bn £0.75bn • £750m PerpNC7 Operating company •
Slide 40: Credit ratings
Senior ratings Moody’s S&P Fitch Group holding company NatWest Group plc A3 BBB+ A+ Stable Stable Stable A1 A+ AA- NatWest Bank Plc 2 Stable Stable Stable A1 A+ AA- Ring-fenced bank operating companies Royal Bank of Scotland plc 2 Stable Stable Stable Not rated A+ AA- NatWest Bank Europe GMBH Stable
Slide 41: Footnotes
Slide 3: 1. Gross loans across 3 businesses. 2. Customer deposits across 3 businesses. 3. Excludes notable items per slide 20. 4. Costs excluding litigation and conduct. Slide 4: 1. ~£1.5bn includes £750m buyback announced and £768m interim dividend announced at H1’25. Slide 5: 1. Non-II in H1’25 vs
Slide 42: 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