NatWest Group plc (NYSE:NWG) Q3 2023 Earnings Conference Call October 27, 2023 4:00 AM ET
Company Participants
Paul Thwaite - CEO
Katie Murray - CFO
Conference Call Participants
Rahul Sinha - J.P. Morgan
Aman Rakkar - Barclays
Ed Firth - KBW
Alvaro Serrano - Morgan Stanley
Guy Stebbings - BNP Paribas Exane
Joseph Dickerson - Jefferies
Benjamin Toms - RBC
Adam Terelak - Mediobanca
Jonathan Pierce - Numis
Chris Cant - Autonomous
Andrew Coombs - Citibank
Robin Down - HSBC
Fahed Kunwar - Redburn Atlantic
Paul Thwaite
Good morning and thank you for joining us for the first set of results since becoming CEO. I'm going to start with the financial headlines and my near-term priorities for the business. Then, Katie, will run you through the quarter three results in greater detail, and after that we'll open it up for questions.
Our customers and communities are central to our strategy. So I'd like to begin by putting the financial headlines in the context of recent customer activity.
During the first nine months of this year, we have lent over £8 billion into the UK economy, opened over 80,000 new business startup accounts, helped 312,000 customers buy or refinance their homes, and opened over 1 million savings accounts alongside around 800,000 current accounts. In addition, we have delivered over £53 billion of climate and sustainable funding and financing since July 2021.
Turning now to the financial headlines. We delivered operating profit of £4.9 billion for the first nine months, which is up 33% on the prior year, with attributable profit of £3.2 billion. Income was £10.9 billion and costs were £5.6 billion. Our cost income ratio was just under 50%, with some benefit from foreign exchange gains, and we are on track to meet our cost target of £7.6 billion for the year.
Our balance sheet remains strong and our funding is well diversified with £424 billion in deposits, £358 billion of customer loans, and a loan to deposit ratio of 83%. We remain committed to a 40% payout ratio with capacity for buybacks and have paid or accrued £1.1 billion in dividend payments in the first nine months.
In addition to the directed buyback of £1.3 billion in May, we have also carried out almost half of the £500 million on market buyback announced in July. Taken together, this represents distributions of £2.9 billion, more than 90% of our nine-month attributable profit, and brings our CET1 ratio to 13.5%.