Turn around for Natwest as bank returns to profitability
Natwest has returned to profitability after suffering heavy losses in 2020, with results boosted by strong savings and lending growth.
The FTSE 100 banking group reported profits of £2.9bn for the latest financial year, up from losses of £753m a year prior, with investors treated to earnings of 25.4p per share.
The bank revealed that lending grew by £7.8bn in 2021, primarily driven by growth in mortgages, while 471,000 people increased their savings at the bank by £100 or more.
“NatWest Group delivered a strong performance in 2021 as we returned to profitability, made progress against our strategy and distributed more than £3.8 billion of capital to our shareholders, including £1.7 billion to the taxpayer,” said chief executive Alison Rose.
A final dividend of 7.5p per share is proposed for the company, brining paid and proposed capital distributions to £3.8bn.
“We are acutely aware of the challenges that many people, families and businesses continue to face up and down the country and are working alongside our customers to provide the support they need – whether that is managing their money better, saving for a house or retirement or starting or growing a new business – as well as playing a leading role in the transition to net zero,” she added.
Looking ahead Natwest said the Covid-19 pandemic, rule changes following Brexit and rising interest rates may continue to have an adverse effect on the company.
Nonetheless, Natwest expects to deliver income of £11bn in 2022 with the group amending its cost cutting target to around three per cent per annum for the next two financial years in order to combat inflation and allow reinvestment in the business.
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