REG - NatWest Group plc - AGM Statement

NatwestAnnouncement

23/04/2024 11:15

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20240423:nRSW6932La&default-theme=true

RNS Number : 6932L  NatWest Group plc  23 April 2024

NatWest Group plc

 

Annual General Meeting Statements

 

23 April 2024

 

NatWest Group plc will hold its Annual General Meeting at 11:00am today. The
meeting will deal with the proposed resolutions as set out in the Notice of
Meeting previously issued to shareholders.

 

The following is an extract from the remarks to be made by Chair, Rick
Haythornthwaite and Chief Executive Officer, Paul Thwaite at the meeting.

 

Rick Haythornthwaite

 

As I said at the time of my appointment in September, it is a great privilege
to assume this role. The NatWest bank that I inherit is consistently
profitable, significantly stronger, and undoubtedly more customer focused than
the one that my predecessor Sir Howard Davies took on in July 2015. We should
not underestimate how much this bank has transformed in recent years. Where
Howard was faced with fixing the issues of the past, I take on the role of
Chair with a mandate to help shape NatWest's future.

 

Clearly 2023 was an exceptional year, that brought challenges for our
customers, our sector, and the economy, as families and businesses faced into
the fastest rate rise cycle since the 1970s with persistently high levels of
inflation. The year brought unexpected challenges for the bank, but our
foundations and performance are strong, in fact profits for 2023 were at the
highest level they have been since before the 2008 financial crisis.

 

Since my appointment was announced, the question I have been asked repeatedly
is "why did you take on this role?" For me, the answer was simple. I care
about the UK. And this bank plays a vital role in our economy, and the lives
of its 19 million customers.

 

I firmly believe the role of a Board is to champion a good growth agenda - not
just for the bank - but across all regions of the UK.  Because a strong
economy matters to NatWest Group, and a strong NatWest Group matters to the
economy. To that end, I am here for one reason and that is to help NatWest be
the best bank it can be for its customers, for the UK economy and for you, our
shareholders.

 

When I joined the Board in January, my first priority was to appoint a
permanent Chief Executive Officer. Following a rigorous and competitive search
process, the Board agreed that Paul Thwaite was the outstanding candidate for
the role. In Paul, I know we have a CEO who brings unrivalled knowledge of our
business, understands what matters to our customers, and will shape the future
of NatWest Group. The banking sector is evolving rapidly and as a Board, we
believe he has the skills to succeed in this changing landscape and,
importantly, to make the most of the opportunities it presents. Under Paul's
leadership, the bank is moving into a new era; and a return to private
ownership is now in sight. Paul and I are ambitious for this bank and it's our
shared view that in delivering for our customers, we will deliver for you, our
shareholders.

 

With that, I will now hand over to Paul to provide an update on the business
and our priorities.

Paul Thwaite

 

This is one of the most important dates in the NatWest Group calendar.  It's
when you hear directly from us. But more importantly, it's an opportunity for
us to hear directly from you and to answer your questions.

 

Firstly, it is an honour to lead NatWest Group. And with it I feel a great
sense of responsibility to succeed for our customers, colleagues, and you, our
shareholders. As Rick has emphasised, NatWest Group plays a vital role in the
lives of our 19 million customers across the country and an essential
contribution to the UK economy.

 

We have a strong bank which is performing well, underpinned by leading
positions across our three customer businesses from which to create further
long-term value for shareholders. This was demonstrated in our 2023 Full Year
financial results. During an uncertain economic environment, we delivered for
our customers, our shareholders, and the wider UK economy, generating
sustainable profits and attractive returns - with our operating profit up 20%
on 2022.  Fundamentally this performance was grounded in the support we
provided to our customers.

 

Last year we:

·     Lent an additional £9 billion into the UK economy - supporting
business owners and homeowners,

·     Opened over 100,000 new start-up accounts for entrepreneurs and
more than 1.5 million savings accounts for individuals,

·     As well as helping 379,000 Retail banking customers to buy or
re-mortgage their home.

 

I strongly believe that by being there throughout our customers' lives and
meeting their changing needs, we can build long-term value, allowing us to
invest for growth and drive attractive returns for shareholders. As we look to
2024 and beyond, I am optimistic about the opportunities ahead. This is an
exciting time for our sector and, importantly, for our bank.

 

The needs and expectations of customers are changing at pace, as they engage
with emerging technology, adapt to new social trends, and build ever more
resilience to a fast-evolving world. This time of change presents an
opportunity for us to grow with our customers by becoming a trusted partner to
them.  By doing so, I am confident we can shape the future of NatWest Group
to deliver its full potential.

 

Through the continued macro uncertainty in the UK and geo-political
uncertainty overseas, we remain focused on the things we can control. This is
reflected in our priorities we have set for the year ahead. Our first and
number one priority is to serve our customers well to deliver disciplined and
profitable growth. I believe that there are significant opportunities to drive
further growth across our three customer business; becoming a trusted partner
to our customers, with services that meet more of their needs today and, in
the future.  In doing so, we will help build a growing economy across all
nations and regions of the UK and make a valuable contribution to wider
society.

 

As the UK's largest commercial bank, with an unmatched network of relationship
managers with sector and regional expertise, we are helping businesses of all
sizes, in all regions to grow. We are also driving investment and innovation
in the UK through our support of start-ups, growth sectors, and as the biggest
lender to infrastructure. And our support to families and individuals is
integral to the economy, including as one of the country's biggest mortgage
lenders, helping people to buy and refinance their homes. We have a proven
ability of building market share in new business areas, including at the start
of customers' financial lives. For example, in Youth, where we are helping
future generations to develop good money habits and now serve around one in
five young people.

 

Secondly, we are prioritising bank-wide simplification to become more
efficient and effective, making it easier for our customers to do business
with us and improving engagement and productivity for our colleagues. We are
re-focussing our investment spend into activity that will help us achieve
this. The programmes and pilots we ran in 2023 have shown us the potential.
For example, working with our technology partners we have consolidated five
legacy systems into one single customer platform in our retail business. This
has enabled us to spend more time with customers and improve the quality of
our interactions. And with the use of artificial intelligence, there are
material opportunities to pursue further customer benefits and increase
efficiency. A bank wide exercise in 2023 identified over 100 priority use
cases for AI to address manual operations processes and wider controls.
Ultimately, we want to build a NatWest Group that is simpler and more
productive to better serve our customers.

 

And thirdly, we are committed to managing our investment, capital, and costs
effectively.

We have a strong track record of controlling costs and, alongside efficient
capital allocation, we will continue to generate the capital to invest in
NatWest's future, whilst delivering attractive distributions to shareholders.
I am confident that these actions will deliver long-term sustainable value for
our customers, shareholders, and the wider UK economy.

To conclude, we delivered a strong performance in 2023, we have clear
priorities for the years ahead and we are ambitious and optimistic for
NatWest. Fundamentally, I want us to be the very best bank we can be for our
customers and for our shareholders.  Our achievements would not be possible
without the continued efforts and dedication of our colleagues, so I would
like to finish by thanking every one of them for making a contribution to
serving our customers day in day out.

 

Rick Haythornthwaite

 

As Paul outlined, delivering sustainable returns to our shareholders is a key
focus for the bank's management team and for the Board. As a Board, we serve
this bank at the behest of you, our shareholders.  This remains front of mind
in each and every decision we make.

 

We have a strong track record of distributing surplus capital to shareholders
and this intention has not changed; we remain committed to a 40% pay-out ratio
on distributions. We were pleased to announce £3.6 billion of capital
returned to our shareholders for 2023. This was achieved through the payment
of an interim dividend of £500 million and a proposed final dividend of £1
billion, which we have asked you to vote in favour of today. We completed a
further £500 million on-market buyback in Q1'24 and announced a new on-market
buyback of £300 million in February, which we expect to be completed by the
end of July. And we were also pleased to have the opportunity to buy back
£1.3 billion of shares directly from His Majesty's Treasury.

 

In 2008, the government stepped in to save the financial system from collapse.
Today we have strong, well performing banks, which are supporting customers
and contributing positively to the British economy. Government ownership of
NatWest now stands below 29%, having started the year at almost 38%.  And we
are pleased that the government remains committed to fully exiting its NatWest
shareholding by 2025 to 2026. This is a shared ambition which we believe is in
the best interests of the bank and our shareholders. Good progress has been
made in recent months and I am confident that this leadership team will see
the return to full private ownership.

 

The Chancellor used his Spring Budget last month to confirm the government's
intention to sell part of its shareholding to retail investors. He said the
sale would take place this summer at the earliest, subject to supportive
market conditions.  And we will work closely with UKGI and His Majesty's
Treasury if the government does decide to launch a retail campaign.

 

To conclude: we are ambitious, optimistic, and focussed on delivering for our
customers, and in turn our shareholders and the UK economy.

 

Forward-looking statements

This announcement may include forward-looking statements within the meaning of
the United States Private Securities Litigation Reform Act of 1995, such as
statements that include, without limitation, the words 'expect', 'estimate',
'project', 'anticipate', 'commit', 'believe', 'should', 'intend', 'will',
'plan', 'could', 'probability', 'risk', 'Value-at-Risk (VaR)', 'target',
'goal', 'objective', 'may', 'endeavour', 'outlook', 'optimistic', 'prospects'
and similar expressions or variations on these expressions. These statements
concern or may affect future matters, such as NatWest Group's future economic
results, business plans and strategies.  In particular, this announcement may
include forward-looking statements relating to NatWest Group plc in respect
of, but not limited to: its economic and political risks, its financial
position, profitability and financial performance (including financial,
capital, cost savings and operational targets), the implementation of its
strategy, its climate and sustainability-related targets, increasing
competition from incumbents, challengers and new entrants and disruptive
technologies, its access to adequate sources of liquidity and funding, its
regulatory capital position and related requirements, its exposure to third
party risks, its ongoing compliance with the UK ring-fencing regime and
ensuring operational continuity in resolution, its impairment losses and
credit exposures under certain specified scenarios, substantial regulation and
oversight, ongoing legal, regulatory and governmental actions and
investigations, and NatWest Group's exposure to operational risk, conduct
risk, cyber, data and IT risk, financial crime risk, key person risk and
credit rating risk. Forward-looking statements are subject to a number of
risks and uncertainties that might cause actual results and performance to
differ materially from any expected future results or performance expressed or
implied by the forward-looking statements. Factors that could cause or
contribute to differences in current expectations include, but are not limited
to, future growth initiatives (including acquisitions, joint ventures and
strategic partnerships), the outcome of legal, regulatory and governmental
actions and investigations, the level and extent of future impairments and
write-downs, legislative, political, fiscal and regulatory developments,
accounting standards, competitive conditions, technological developments,
interest and exchange rate fluctuations, general economic and political
conditions and the impact of climate-related risks and the transitioning to a
net zero economy. These and other factors, risks and uncertainties that may
impact any forward-looking statement or NatWest Group plc's actual results are
discussed in NatWest Group plc's 2023 Annual Report on Form 20-F, and its
other public filings. The forward-looking statements contained in this
announcement speak only as of the date of this announcement and NatWest Group
plc does not assume or undertake any obligation or responsibility to update
any of the forward-looking statements contained in this announcement, whether
as a result of new information, future events or otherwise, except to the
extent legally required.

 

 

 

Legal Entity Identifier: 2138005O9XJIJN4JPN90

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  AGMIJMMTMTMTBMI