NatWest profit jumps 20% as Thwaite confirmed as CEO

The logo of NatWest, a retail unit of RBS, outside a bank branch in London, U.K., on Tuesday, June 26, 2012.

Simon Dawson | Bloomberg | Getty Images

British bank NatWest confirmed Paul Thwaite as its permanent chief executive on Friday and reported forecast-beating profit for 2023, as it gears up for a crunch sale of state-owned stock in the company after a scandal-hit year.

The taxpayer-backed lender reported pre-tax profit of 6.2 billion pounds ($7.81 billion) for the 12-month period, up 20% on 5.1 billion pounds the prior year and ahead of a 5.95 billion pounds average of analyst forecasts compiled by the bank.

NatWest also announced a final dividend of 11.5 pence per share and a share buyback of 300 million pounds.

Thwaite becomes CEO on a permanent basis with immediate effect, the bank said, after taking on the role on an interim basis last July following the abrupt departure of his predecessor Alison Rose.

The former business banking boss will be tasked with repairing the group’s reputation after a damaging row with former Brexit Party leader Nigel Farage last year over closure of his accounts forced out Rose and wealth boss Peter Flavel.

Thwaite will also prepare the ground for a planned retail sale of government-owned stock in the bank — which remains 35% taxpayer-owned after its 45.5 billion pound bailout in the 2008-9 financial crisis.

NatWest’s profit was its biggest since that rescue, as higher central bank interest rates continued to lift lending revenue. But a greater risk of cash-strapped borrowers defaulting on loans and margin pressure from fiercer competition for savings and mortgage products are eating into margins.

The bank said its net interest margin — a key measure of lending profitability — dipped quarter-on-quarter to 2.86% at the end of December, down from 2.94% at end-September.

NatWest set aside 578 million pounds for potential soured loans, up from 337 million pounds the prior year – but the figure came in below analyst forecasts.

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