NatWest Group Plc: H1 2026 Interim Results Summary
Business Context and Reporting Period
This Form 6-K reports the interim results for NatWest Group Plc for the half-year ended 30 June 2026. The period was characterized by strong financial performance, the completion of the acquisition of Evelyn Partners (creating the UK's leading Private Bank and Wealth Manager), and the strengthening of full-year guidance. The Group serves over 20 million customers in the UK, focusing on Retail Banking, Private Banking & Wealth Management, and Commercial & Institutional businesses.
Key Financial Metrics
| Metric | H1 2026 | H1 2025 | Variance |
|---|---|---|---|
| Total Income | £8,862m | £7,985m | +11.0% |
| Operating Profit | £4,318m | £3,585m | +20.4% |
| Profit for the Period | £3,180m | £2,675m | +18.9% |
| Profit Attributable to Ordinary Shareholders | £3,035m | £2,488m | +22.0% |
| Earnings Per Share (Basic) | 38.1p | 30.9p | +23.3% |
| Return on Tangible Equity (RoTE) | 19.7% | 18.1% | +1.6pp |
| Cost:Income Ratio (excl. litigation/conduct) | 46.0% | 48.8% | -2.8pp |
| Loan Impairment Rate | 19bps | 19bps | 0bps |
| Net Interest Margin (NIM) | 2.48% | 2.28% | +20bps |
| Common Equity Tier 1 (CET1) Ratio | 13.2% | 14.0% | -80bps |
| Liquidity Coverage Ratio (LCR) | 140% | 147% | -7pp |
Material Changes vs. Prior Period
- Revenue Growth: Total income rose 11.0% year-on-year, driven by lending balance growth, deposit margin expansion, and higher trading income. Total income excluding notable items increased 8.9%.
- Profitability: Operating profit increased 20.4% to £4.3 billion. The cost:income ratio improved by 2.8 percentage points to 46.0%, aided by £250 million in gross cost reductions and operational simplification.
- Balance Sheet Expansion: Customer Assets and Liabilities (CAL) grew by £95.2 billion (10.7%). This includes £71.7 billion from the Evelyn Partners acquisition and £23.5 billion of organic growth in existing businesses.
- Capital Position: The CET1 ratio decreased to 13.2% (from 14.0% in Q4 2025), primarily due to a 140 basis point impact from the Evelyn Partners acquisition and regulatory deductions, partially offset by strong capital generation (137 basis points pre-distributions).
- Asset Quality: The loan impairment rate remained stable at 19 basis points. ECL provisions decreased slightly to £3.6 billion, with coverage at 0.80%.
Guidance, Outlook, and Management Commentary
Management has strengthened its guidance for 2026 following the acquisition and strong H1 performance.
- 2026 Guidance:
- Total income (excl. notable items): ~£17.9 billion.
- Operating expenses (excl. litigation/conduct): ~£8.5 billion.
- Loan impairment rate: Below 25 basis points.
- RoTE: Greater than 19%.
- Capital generation pre-distributions: Greater than 240 basis points (excluding Evelyn impact).
- 2028 Targets: CAL growth >4% CAGR; Cost:income ratio <45%; RoTE >18%.
- Capital Return: An interim dividend of 12.0p per share was announced. The Group now expects to announce share buybacks with the FY 2026 results, six months earlier than previously planned.
- Risks and Contingencies:
- Economic Uncertainty: Post-model adjustments increased to £0.3 billion to account for economic uncertainty, including second-order impacts from the Middle East conflict.
- Basel 3.1: Expected to increase Risk-Weighted Assets (RWAs) by ~£10 billion on 1 January 2027.
- Climate Risk: Physical and transition climate risks have been incorporated into the extreme downside economic scenario.
Key Facts for Investor Verification
- Evelyn Partners Acquisition Impact: Verify the specific integration costs and the £71.7 billion AUMA contribution to CAL growth.
- Capital Generation Sustainability: Confirm the ability to maintain >240bps capital generation pre-distributions given the upcoming Basel 3.1 RWA increase.
- Cost Control: Monitor the trajectory of the cost:income ratio to ensure it meets the <45% target by 2028 amidst inflationary pressures.
- Asset Quality Trends: Track the Stage 3 unsecured portfolio flows and the impact of the Middle East conflict on post-model adjustments in the Commercial & Institutional segment.
- Dividend and Buyback Execution: Verify the timing and scale of the announced share buyback program starting in FY 2026.