NatWest Group Plc: Q3 2025 Financial Summary
Business Context and Reporting Period
This Form 6-K filing covers the third quarter ended 30 September 2025 and the nine-month period ended on the same date. NatWest Group reported strong performance driven by healthy customer activity, lending growth, and continued cost simplification. The group operates three primary segments: Retail Banking, Private Banking & Wealth Management, and Commercial & Institutional.
Key Financial Metrics
| Metric | Q3 2025 | Q3 2024 | 9M 2025 | 9M 2024 |
|---|---|---|---|---|
| Total Income | £4.33 billion | £3.74 billion | £12.32 billion | £10.88 billion |
| Profit for the Period | £1.68 billion | £1.24 billion | £4.36 billion | £3.48 billion |
| Profit Attributable to Ordinary Shareholders | £1.60 billion | £1.17 billion | £4.09 billion | £3.27 billion |
| Return on Tangible Equity (RoTE) | 22.3% | 18.3% | 19.5% | 17.0% |
| Cost:Income Ratio (excl. litigation) | 45.8% | 47.6% | 47.8% | 52.8% |
| Net Interest Margin | 2.37% | 2.18% | 2.31% | 2.11% |
| Common Equity Tier 1 (CET1) Ratio | 14.2% | 13.6% | 14.2% | 13.6% |
| Liquidity Coverage Ratio (LCR) | 148% | 151% | 148% | 151% |
| Net Loans to Customers | £415.3 billion | £386.7 billion | £415.3 billion | £386.7 billion |
| Assets Under Management (AUMA) | £56.0 billion | £48.9 billion | £56.0 billion | £48.9 billion |
Material Changes vs. Prior Period
- Income Growth: Total income increased by 15.7% year-over-year (Q3 2025 vs. Q3 2024), driven by deposit margin expansion and lending growth. Income excluding notable items rose 10.4%.
- Profitability: Operating profit before tax rose 30.4% to £2.18 billion in Q3 2025. RoTE improved by 4.0 percentage points to 22.3%.
- Cost Efficiency: The year-to-date cost:income ratio (excluding litigation and conduct) improved by 5.0 percentage points to 47.8%, reflecting simplification efforts and a reduction in headcount (approx. 600 FTE lower than Q3 2024).
- Balance Sheet: Net loans to customers grew by £8.2 billion in the quarter. Customer deposits decreased slightly by £1.3 billion, maintaining a loan:deposit ratio of 95%.
- Capital: The CET1 ratio increased by 60 basis points to 14.2%, supported by capital generation of 101 basis points in the quarter and RWA management actions delivering a £2.2 billion benefit.
Guidance, Outlook, and Risks
- Updated Guidance: Management has upgraded its 2025 full-year guidance. Total income excluding notable items is now expected to be around £16.3 billion, and RoTE is expected to exceed 18.0%.
- Future Targets: New guidance for 2026 and targets for 2028 will be announced with the Full Year 2025 results on 13 February 2026.
- Climate Finance: The group provided £7.6 billion in climate and transition finance in Q3 2025, progressing toward a target of £200 billion between July 2025 and 2030.
- Risks and Contingencies:
- Litigation: Significant developments include a summary judgment dismissal of USD LIBOR claims in the US (subject to appeal), while a Euribor case was reinstated by the US Court of Appeals. An FX settlement in Australia was approved.
- Regulatory: The US monitorship regarding fixed-income securities spoofing was paused in May 2025, with obligations extended to December 2026.
- Forward-Looking Statements: Results are subject to economic uncertainty, interest rate fluctuations, and geopolitical risks.
Key Facts for Investor Verification
- Capital Strength: Verify the sustainability of the 14.2% CET1 ratio against regulatory buffers and the impact of the £1.3 billion foreseeable ordinary dividend.
- Cost Trajectory: Monitor the continued reduction in the cost:income ratio as the group integrates Sainsbury's Bank balances and executes restructuring.
- Asset Quality: Review the loan impairment rate of 15bps (Q3 2025) and the stability of Stage 3 provisions, particularly in the Commercial & Institutional segment.
- Litigation Exposure: Assess the potential financial impact of the reinstated Euribor litigation and the ongoing US Anti-Terrorism Act cases.
- Share Buybacks: Confirm the execution of the on-market share buyback programme, which included the repurchase and cancellation of 58.9 million shares in the nine-month period.