NatWest Group (NWG) Q4 2023 earnings summary

Executive summary

• FY23 attributable profit £4.4bn, up 31.6% YoY; return on tangible equity (ROTE) 17.8%, versus 12.3% in FY22.

• Strong capital generation supported £3.6bn of FY23 distributions; lending and customer support expanded across personal, business and sustainable finance.

Financial highlights

• Income excluding notable items £14.339bn, up 9.8% YoY; reported total income £14.752bn, including £413m net notable income.

• Net interest income excluding notable items £11.081bn, up 12.1% YoY; non-interest income excluding notable items £3.258bn, up 2.5%.

• Operating profit £6.178bn, up 20.4% YoY; operating expenses £7.996bn including £355m litigation and conduct costs.

• Impairment losses £578m versus £337m in FY22; FY23 loan impairment rate 15bps versus 9bps.

Outlook and guidance

• 2024 income excluding notable items expected at £13.0–13.5bn; operating costs excluding litigation and conduct expected broadly stable YoY.

• 2024 ROTE expected around 12%; loan impairment rate expected below 20bps.

• 2026 ROTE target above 13%; CET1 target range 13–14% and ordinary dividend payout target around 40% of attributable profit.

• RWAs expected around £200bn at end-2025, including Basel 3.1 impact and subject to final rules and approval.