NatWest Posts Strong Q3 Results, Lifts Profit Outlook as Lloyds Reels from Car Loan Scandal
NatWest has reported a strong set of third-quarter results, with pre-tax profit jumping 30% to £2.18bn, in sharp contrast to Lloyds Banking Group, which yesterday revealed a 36% drop in profits and a further £800m provision linked to the car loan commissions scandal.
NatWest has no exposure to the scandal, giving it clear breathing room just as Lloyds and several peers face a potentially costly regulatory settlement.
The bank’s profit jump was driven by:
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Broad-based lending growth to both households and businesses
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Lower impairment charges of £153m, down from £245m last year
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A continued focus on cost efficiencies, despite overall expenses rising
NatWest has cut around 600 jobs over the past year, including 100 in the last quarter, as part of a push to “accelerate bank-wide simplification”. However, higher overall operating costs meant the savings did not significantly boost quarterly profit.
The bank — which fully exited government ownership earlier this year, marking the end of its post-2008 bailout era — has now raised its full-year guidance.
It expects income (excluding notable items) for 2025 to come in at £16.3bn, reinforcing earlier expectations of more than £16bn.
Summary:
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Q3 pre-tax profit: £2.18bn (+30.4% YoY)
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Lending growth: Strong across consumer + business
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Impairment charges: £153m (down vs. £245m)
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Cost-cutting: 600 jobs cut over 12 months
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New income guidance: £16.3bn for FY 2025
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No exposure to the car financing compensation scandal (key differentiator vs Lloyds)
NatWest’s results highlight a divergent outlook in the UK banking sector, with cleaner balance sheets and lower legal risk now proving as important as lending margins in determining performance.
CEO Paul Thwaite said:
“As a result of our consistent delivery and capital generation, we have upgraded our income and returns guidance for 2025 and are well placed to support our customers, invest for the future and deliver returns to our shareholders.”
