NatWest Group(US:NWG)2024-02-23 19:43Shareholder Information - NatWest Group reported a total of 8,991,736,976 ordinary shares outstanding as of December 31, 2023[5]. - The company has issued various subordinated notes, including 5.125% Tier 2 Notes due 2024 and 3.754% Tier 2 Notes due 2029, registered on the New York Stock Exchange[4]. - There are no material modifications to the rights of security holders reported for the fiscal year[13]. - The company paid ordinary share dividends totaling £1.456 billion and paid-in equity dividends of £242 million during the year[179]. Financial Reporting and Compliance - The financial statements are prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board[11]. - The company is classified as a large accelerated filer under the Exchange Act[8]. - NatWest Group has confirmed compliance with all reporting requirements under the Securities Exchange Act of 1934 for the past 12 months[6]. - The company has submitted and posted all required Interactive Data Files on its corporate website during the preceding 12 months[7]. - NatWest Group's financial statements are prepared in accordance with GAAP, and the document includes non-IFRS measures to provide a consistent basis for comparing business performance[25]. - The financial statements were audited in accordance with PCAOB standards, presenting a fair view of the Group's financial position[123]. - The Group maintained effective internal control over financial reporting as of December 31, 2023, according to the audit opinion[163]. Financial Performance - NatWest Group reported a total income increase of 12.1% to £14.8 billion in 2023, with a return on equity of 12.1% and a RoTE of 17.8%[33][34]. - Profit from continuing operations was £4,744 million, an increase of £887 million, or 23.0%, compared to 2022[67]. - The total comprehensive income for the year was £4,686 million, significantly higher than £625 million in 2022[174]. - The effective tax rate decreased to 23.2% from 24.8% in 2022, with a tax charge of £1,434 million for the year[58]. - The total income for 2023 was £14,752 million, up 12.1% from £13,156 million in 2022[170]. - Profit for the year reached £4,632 million, representing a 28.9% increase compared to £3,595 million in 2022[174]. - Earnings per ordinary share for continuing operations increased to 49.2p in 2023, up from 36.5p in 2022, marking a growth of 34.8%[170]. Asset and Liability Management - Total assets decreased to £692.673 billion in 2023 from £720.053 billion in 2022, a decline of approximately 3.8%[177]. - Total liabilities decreased to £655.485 billion in 2023 from £683.557 billion in 2022, a reduction of about 4.1%[177]. - The company reported a significant change in operating assets and liabilities, with a decrease of £25,679 million in 2023 compared to a decrease of £48,447 million in 2022[189]. - Cash and balances at central banks decreased significantly to £104.262 billion in 2023 from £144.832 billion in 2022, a drop of about 28%[177]. Risk Management - The company faces significant economic and political risks, including inflation, interest rates, and geopolitical developments, which may adversely affect its results[29]. - NatWest Group's strategy implementation carries execution and operational risks, and it may not achieve its stated aims and targeted outcomes[29]. - The company has significant exposure to counterparty and borrower risk, which may lead to credit losses impacting its financial condition[29]. - NatWest Group's liquidity and funding may be affected if it fails to meet prudential regulatory requirements, potentially triggering management actions[29]. - The company is subject to regulatory stress tests, and failure to meet these requirements could result in increased capital maintenance[29]. Operational Highlights - Total operating expenses were £7,996 million, with a cost-to-income ratio of 51.8%[35][44]. - Operating profit before impairment losses was £6.756 billion, with an operating profit of £6.178 billion after accounting for impairment losses[77]. - The company is focused on transitioning to a net zero economy, with ongoing development of its climate risk analysis and net zero strategy[18]. - The bank's focus on digital sales and cost management remains critical for maintaining competitive advantage in the market[112]. - NatWest Group is actively reshaping its branch network and simplifying its product offerings to enhance customer experience[112]. Customer and Market Dynamics - Customer loans increased by £15.1 billion to £381.4 billion, driven by a £7.6 billion rise in Retail Banking and £2.0 billion growth in Commercial & Institutional[38]. - Customer deposits decreased by £18.9 billion to £431.4 billion, with a loan-to-deposit ratio of 84%[40][45]. - The bank faces increasing competition from non-traditional players and new entrants in the UK market, particularly in the mortgage and credit card sectors[113][114]. - Retail Banking reported total income of £5.931 billion in 2023, an increase of £285 million or 5.0% compared to 2022[85]. - Total income for Commercial & Institutional was £7,421 million in 2023, an increase of £1,008 million, or 15.7%, compared to 2022[98]. Climate and Sustainability Initiatives - NatWest Group provided £29.3 billion in climate and sustainable funding and financing in 2023, aiming for £100 billion by the end of 2025[39][44]. - Retail Banking provided £3.7 billion of climate and sustainable funding in 2023, focusing on properties with high energy performance ratings[89]. - NatWest Group's climate and sustainability-related disclosures are subject to change and are not fully aligned with IFRS standards, indicating inherent uncertainties[18].