Natwest, trading in Scotland as RBS, said “positive momentum” had driven a sharp increase in profit across the bank’s divisions as it avoided punishing charges for mis-selling car finance that have hit its rivals.
It strengthened its guidance for income and return on tangible equity while other guidance remains unchanged. It now expects income of about £16.3bn for the full year.
Operating profit before tax over nine months came in at £5.8 billion, from £4.7bn in the corresponding period last year.
The Q3 figure was £2.2bn, from £1.7bn in Q3 2024. Attributable profit rose to £4.1bn against £3.3bn. Income hit £12.1bn from £10.8bn.
Impairments for Q3 came in lower at £153m compared with £193m in Q2 ’25, a significantly lower sum compared with big motor finance lenders such as Barclays and Lloyds which also posted robust profits this week of £2.1bn and £1.2bn, respectively.
However, their figures were marred by additional charges they had booked for potential compensation bills they face for mis-sold motor finance, with Lloyds bracing for a £1.95 billion hit and Barclays earmarking £325 million for the scandal. NatWest has no exposure to the car loans affair.
NatWest said its assets under management and administration grew by 8.1% to £56bn.
Lending grew by £4.4bn, excluding central items, to £388bn in Q3, and to £16.3bn in the 9 months to Q3 ’25.
Mortgage balances (Retail + Wealth) were up £1.7bn in Q3 ‘25 and by £5.1bn in 9 months to Q3 ‘25.
Its net interest margin, the key difference between what it charges for loans and pays on deposits, had risen to 2.37% from 2.18% a year earlier.
Chief executive, Paul Thwaite, said: “NatWest Group delivered another strong performance in the third quarter of 2025, underpinned by healthy levels of customer activity and the continued support we provide to them. This is driving positive momentum across our three businesses, with continued lending growth and deposits remaining stable.
“With our strategic focus on growth, NatWest Group’s impact can be felt right across the economy, as we help people get on the housing ladder, save and invest for the future and grow their businesses – from innovative start-ups and vital mid-market firms to the largest multinationals responsible for critical infrastructure projects.
“We are also becoming a much simpler bank, with tight control of costs supporting our digital transformation that is enabling us to anticipate and meet the changing needs of customers at pace.
“As a result of our consistent delivery and capital generation, we have upgraded our income and returns guidance for 2025 and are well placed to support our customers, invest for the future and deliver returns to our shareholders.”
Market reaction
Chris Beauchamp, chief market analyst UK at investment and trading platform IG, said NatWest’s upgrade guidance has sparked speculation for further acquisition hunting
“NatWest has joined Barclays in upgrading guidance, a sign that things really are looking up for the UK banking sector,” he said.
“It has been a good 24 hours for UK news, providing hope that the economy is moving out of the doldrums.
“NatWest’s performance means that speculation that it is poised to go hunting for more acquisitions can only increase from here, now that the turnaround efforts have borne fruit.”
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