NatWest has reported a 24% increase in annual pre-tax profit, reaching £7.7 billion for 2025, just ahead of analyst forecasts of £7.5 billion. The figure compares with £6.2 billion a year earlier and reflects the bank’s continued focus on simplifying operations and boosting profitability in its domestic markets.
The British lender also raised its performance targets, projecting a return on tangible equity of more than 18% by 2028, up from its previous guidance of over 15% in 2027. CEO Paul Thwaite said the bank is “raising our ambition and sharpening our strategic focus, with stretching new targets in place.”
Shares in NatWest slipped 0.5% following the announcement, after a 37% rise over the past year. Analysts said the results reinforce NatWest’s shift away from the global ambitions of its former RBS era, which ended with a government bailout during the 2008 financial crisis, toward a simpler, more profitable domestic lender.
The bank’s performance comes as the UK economy remains stable, with low loan defaults and a supportive political and regulatory environment under the Labour government. Executive pay has risen alongside profits, with Thwaite’s total compensation increasing to £6.6 million in 2025 from £4.9 million in 2024.
NatWest’s annual report highlights its growing wealth management ambitions. Earlier this week, the bank agreed to acquire Evelyn Partners, one of the UK’s largest wealth managers, for £2.7 billion. This marks NatWest’s biggest deal since the 2008 bailout and signals a major push into a market previously dominated by independent players such as St James’s Place.
The bank also announced a £750 million share buyback for the first half of 2026, demonstrating a strategy of returning excess capital to shareholders while continuing to invest in acquisitions and technology.
Assets under management and administration grew 20% to £58.5 billion over the year, even before the Evelyn Partners acquisition. NatWest said the move into wealth management is part of a broader strategy to offset pressures on lending income in a low-interest-rate environment, targeting a sector with long-term growth potential despite its high costs.
Analysts view the combination of strong profits, higher targets, and strategic acquisitions as a signal that NatWest is positioning itself to compete more aggressively in the UK’s wealth management market while maintaining its focus on core domestic banking operations.
The bank’s results and plans underline the ongoing transformation of the UK banking sector, with lenders increasingly relying on wealth management, technology, and strategic investments to drive growth as traditional lending margins face pressure.
