NatWest Group plc Q1 2026 Earnings Recap

NatWest’s shares declined 3.3% following the Q1 report as investors reacted negatively to cautious guidance amid margin pressure and a higher impairment provision driven by revised economic assumptions.

Key Takeaways

• Income grew 6.9% year-on-year to GBP 4.2 billion, with net interest margin up slightly to 247 basis points, though lending margin was down 2 basis points primarily due to mortgages.
• Customer lending rose 6.6% to GBP 400 billion, supported by GBP 7.3 billion loan growth across Retail and Commercial segments; deposits increased 2.6% to GBP 445 billion.
• Operating costs increased 4.8% to GBP 2 billion but operating leverage improved, reducing the cost-to-income ratio by 2.1 percentage points to 46.5%.
• Impairment charges rose to GBP 283 million (26 basis points), including a GBP 140 million provision reflecting updated, more cautious macroeconomic scenarios with slower growth and higher inflation.
• Guidance was revised with income expected at the top end of GBP 17.2–17.6 billion range, assuming Bank of England base rates remain at 3.75%, signaling a cautious outlook given the uncertain environment.