- NatWest revealed its pre-tax operating profits were just under £6.2bn in 2024
- The banking giant expects to return to fully private ownership later this year
NatWest Group’s profits surpassed forecasts last year after it added about 500,000 new customers and grew both borrowing and deposit levels.
The FTSE 100 lender, which could finally free itself from partial Government ownership this year, revealed pre-tax operating profits of £6.2billion for 2024, compared to analysts’ expectations of £6.1billion.
Customer deposits increased by 2.9 per cent to £431.3billion, thanks partly to growing instant-access savings volumes in its private banking business.
A total of 1.2 million Britons took advantage of elevated interest rates to switch bank accounts last year, the second successive year it has exceeded one million, according to recent figures from the Current Account Switch Service.
NatWest also boosted its net loans by £12.9billion to £368.5billion, reflecting the acquisition of Metro Bank’s mortgage portfolio and Sainsbury’s core banking arm.
It said it helped over 351,000 people to either purchase or refinance their mortgage during the year, including more than 35,000 first-time buyers.
Good results: NatWest Group’s profits surpassed forecasts last year after it added about 500,000 new customers and grew both borrowing and deposit levels
However, the company’s overall net income still dipped by £49million to £14.7billion despite enjoying a slightly higher net interest margin, which boosted net interest income by 2 per cent to £11.3billion.
Net interest margin is a key profit measure for lenders, and reflects the difference between what lenders charge borrowers and pay savers.
Paul Thwaite, chief executive of NatWest, said: ‘We welcomed around 500,000 new customers to NatWest Group, grew each of our three customer businesses and delivered growth on both sides of the balance sheet.’
He added that 2025 would likely see the banking firm, which owns wealth manager Coutts, to fully private ownership.
The UK Government has gradually reduced its holding in NatWest in recent years, having part-nationalised the group – formerly known as Royal Bank of Scotland – in 2008 when it ran into major financial trouble.
Taxpayers once held an 84 per cent stake in the company, but this has subsequently decreased to under 10 per cent.
A further sell-off will allow the Government to capitalise on NatWest’s soaring share price, which has more than doubled in the past 12 months.
NatWest Group shares stood 2 per cent lower at 428.2p on Friday morning.
Matt Britzman, senior equity analyst at Hargreaves Lansdown, said: ‘There’s been a seismic sentiment shift over 2024, as the NatWest has moved on from its troubles at the helm and the UK banking environment has played out much better than some had feared.
‘The setup for 2025 is one of cautious optimism, with borrowers remaining resilient, inflation in a more manageable place, and a UK economy that’s trying its hardest to squeeze out some growth.’
NatWest anticipates its income excluding notable items to rise to between £15.2billion and £15.7billion this year
Its results come a day after Barclays declared its annual profits skyrocketed by almost a quarter last year on the back of higher structural hedge income and a rebound in corporate dealmaking.
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