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NatWest Group PLC ADR NWG

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1-Star Price

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Economic Moat

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NatWest Beats Consensus Estimate on One-Offs and More Loan-Loss Reversals

Niklas Kammer, CFA Equity Analyst

Analyst Note

| Niklas Kammer, CFA |

No-moat NatWest Group reported third-quarter operating profit before tax of GBP 1.07 billion, comfortably ahead of consensus estimates collected by NatWest itself of GBP 0.68 billion. However, this beat was partially driven by one-offs in noninterest income. Loan-loss reversals of GBP 242 million versus an expected loss of GBP 40 million by analysts collectively also helped. We plan to update our model shortly but don’t expect a material change to our GBX 230 per-share fair value estimate. Our no moat rating is unchanged.

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Company Profile

Business Description

NatWest Group is a universal bank headquartered in the United Kingdom, where it derives around 90% of its total income. The bank operates a retail, commercial, and private bank in the U.K., offering clients lending and payment services as well as asset management services. The three segments combined consume about 65% of the group’s risk-weighted assets. It also provides financing, risk management, and trading solutions around the world to global financial institutions and large corporates in its NatWest markets segment.

Contact
Gogarburn, P.O. Box 1000
Edinburgh, EH12 1HQ, United Kingdom
T +44 1316260000
Sector Financial Services
Industry Banks - Diversified
Most Recent Earnings Sep 30, 2021
Fiscal Year End Dec 31, 2021
Stock Type —
Employees 58,900

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