NatWest boosted by rising interest rates and growth in mortgages
Lender to pay special dividend but cautions on the impact of inflation
Second-quarter profits at NatWest comfortably beat expectations and the bank raised its outlook for the year as it was buoyed by rising interest rates and mortgage growth.
Revenues for the quarter to June 30 rose 26 per cent year on year to £3.2bn, beating analysts’ expectations of £2.9bn.
That was driven in part by a jump in mortgage lending.
Operating profit before tax was £1.5bn, a 20 per cent increase on £1.28bn the previous year and well ahead of analysts’ expectations’ of £1bn.
The figures exclude its Ulster Bank division in the Republic of Ireland, which it is exiting.
As with other lenders, NatWest has benefited from increasing interest rates. The Bank of England has raised rates to 1.25 per cent as it tries to cool inflation.
But the lender, one of the UK’s largest banks, sounded a note of caution on the economy and higher prices.
The bank announced an interim dividend of 3.5p per share, up 17 per cent on 2021, as well as a special dividend of 16.8p per share.
Shares in NatWest rose by 8 per cent in early trading in London.
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