Earnings call transcript: NatWest Group posts slight Q3 2026 beat as shares slide
NatWest Group reported slightly higher third-quarter profit and revenue, but the bank's shares fell sharply before recovering in after-hours trading. Investors focused more on the bank's outlook, costs and capital questions than the modest earnings beat. The company reported earnings per share of 57.4 pence, up 13.2% year-on-year, and revenue of £6.23 billion, exceeding expectations by £50 million.
Return on tangible equity stood at 21.6%, well above the four-year average of 17%. Capital generation was strong, with a common equity tier one ratio of 13.5%. Full-year guidance remained unchanged, with expectations of £17.9 billion in income excluding notable items, operating expenses of £8.5 billion, and impairment charges below 25 basis points.
Management highlighted the bank's continued strong profitability, solid capital generation, and stable margins. The company expects a structural hedge to contribute more than £1 billion to income in 2027, bringing total hedge income above £7 billion. NatWest's strategy focuses on disciplined growth, simplification, and capital management, positioning the bank as the most efficient large U.K. bank.
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