NatWest Group(NWG) - 2024 Q3 - Quarterly Report

Financial Performance - Attributable profit for Q3 2024 was £1,172 million, with a return on tangible equity (RoTE) of 18.3%[7] - Operating profit for Q3 2024 was £1,674 million, with a return on tangible equity (RoTE) of 18.3%[20] - Profit attributable to ordinary shareholders for Q3 2024 was £1,172 million, with earnings per share of 14.1 pence[21] - Attributable profit for the period was £3,271 million, with an ordinary interim dividend paid of £497 million[85] - Profit for the period increased to £3,483 million for the nine months ended 30 September 2024, compared to £3,344 million in the same period last year, representing a growth of 4.1%[90] - The company reported a total comprehensive income for the period of £3,834 million, compared to £2,708 million in the previous year, representing a significant increase of 41.5%[91] Income and Revenue - Total income excluding notable items for Q3 2024 was £3,772 million, an increase of £182 million or 5.1% compared to Q2 2024, driven by lending and deposit growth[8] - Total income for Q3 2024 increased by 2.3% to £3,744 million compared to Q2 2024 and was 7.3% higher than Q3 2023[21] - Total income for the nine months ended 30 September 2024 was £10,878 million, a decrease of 3.0% from £11,215 million in the previous year[90] - Non-interest income decreased to £2,571 million from £2,804 million, a decline of 8.3% year-over-year[90] Loans and Deposits - Net loans to customers increased by £8.4 billion in Q3 2024, including £2.3 billion from the Metro Bank mortgage portfolio acquisition[9] - Customer deposits rose by £2.2 billion in Q3 2024, with growth across all three business segments[9] - Customer deposits increased to £431.1 billion, with net loans to customers at £386.7 billion[49] - Customer deposits totaled £435.9 billion, showing a significant increase in retail banking[52] - The loan impairment rate decreased to 28 basis points in Q3 2024 from 12 basis points in Q2 2024, reflecting improved asset quality[26] Capital and Ratios - The Common Equity Tier 1 (CET1) ratio was 13.9%, 30 basis points higher than Q2 2024, with capital generation of 57 basis points in the quarter[9] - The CET1 ratio improved to 13.9%, reflecting a 30 basis point increase from Q2 2024, primarily due to attributable profit for the quarter[25] - CET1 ratio increased to 13.9%, up 50 basis points from 13.4% as of December 31, 2023, driven by a £0.9 billion increase in CET1 capital and a £1.3 billion decrease in RWAs[77] - The overall capital requirement stands at 10.5% for CET1, with a headroom of 3.4%[79] Impairment and Credit Quality - Net impairment charge for Q3 2024 was £245 million, representing 25 basis points of gross customer loans, with low levels of default[8] - The company anticipates a loan impairment rate for 2024 to be below 15 basis points[14] - A net impairment charge of £245 million was recorded in Q3 2024, with the year-to-date charge at £293 million, representing 10 basis points of gross customer loans[21] - The expected credit loss (ECL) coverage ratio increased from 0.86% to 0.89%[21] Assets and Liquidity - Total assets as of 30 September 2024 were £711.9 billion, reflecting a 3.1% increase from the previous quarter[19] - The liquidity coverage ratio (LCR) was 148%, with £52.7 billion headroom above the 100% minimum requirement[9] - Liquidity portfolio increased by £3.7 billion to £226.5 billion, with primary liquidity rising by £14.2 billion to £162.3 billion[83] - Total regulatory capital reached £35.79 billion, with CET1 capital at £25.30 billion as of September 30, 2024[82] Operational Efficiency - Total operating expenses decreased by £180 million compared to Q2 2024 and were £102 million lower than Q3 2023[21] - The cost:income ratio (excluding litigation and conduct) improved to 47.6% for the total group, with retail banking at 45.0%[49] - The cost-to-income ratio increased to 54.1% from 52.1% in the previous year, indicating higher operational costs relative to income[121] Strategic Initiatives - The company provided £85.4 billion towards its target of £100 billion in climate and sustainable funding by September 2024, with £7.1 billion provided in Q3 2024[22] - NatWest Group aims to provide £100 billion in climate and sustainable funding and financing from July 1, 2021, to the end of 2025, with a target of at least £10 billion for residential properties with EPC ratings A and B by the end of 2025[123] Shareholder Returns - The company paid ordinary share dividends totaling £1,505 million during the period[95] - The company repurchased 173.3 million shares for a total consideration of £450.9 million during the period[95] - New shares issued amounted to £800 million, contributing to the overall equity increase[94]