NatWest has reported a 40% jump in first quarter profits but warned of the UK’s “uncertain” economy amid the cost of living crisis, saying it had already referred more than 2,000 customers to debt experts at Citizens Advice.
The banking group – formerly known as Royal Bank of Scotland – beat expectations after reporting a jump in pre-tax profits to £1.2bn compared with £885m a year earlier. That was compared to analyst forecasts of a 15% drop in profits to £755m.
Its strong first quarter results – the first reported since the UK government stake in the group fell below 50% last month – was supported by mortgage borrowing, higher interest rates and a rebound in consumer spending as Covid restrictions were eased.
NatWest was also able to release £38m of the cash it originally put aside for potential defaults on loans during the pandemic, despite what it said was “significant uncertainty in the economic outlook”.
“The world has changed considerably during the last three months,” said NatWest’s chief executive, Alison Rose, noting the impact the Russian invasion of Ukraine was having on the UK economy.