REG - Natwest Markets PLC NatWest Markets N.V. - NWM Plc Q3 Results 2025
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RNS Number : 6577E Natwest Markets PLC 24 October 2025
NatWest Markets Group
Q3 2025
Interim Management Statement
ci.natwest.com
NatWest Markets Group (NWM Group)
Results for Q3 2025
We have delivered a robust set of results in the third quarter of 2025, in an
environment which continues to be impacted by geopolitical risks and
uncertainty on trade policies. We maintained a high level of engagement with
our customers and capitalised on our strengths through a connected Commercial
& Institutional segment, enabling us to extend the reach of our
proposition. Our results were underpinned by a disciplined approach to balance
sheet and risk management.
Financial review
NWM Group maintained its robust capital and liquidity position in Q3 2025 and
reported a profit of £126 million, compared with a profit of £30 million in
Q2 2025 and a profit of £20 million in Q3 2024. Total income decreased to
£326 million in Q3 2025, largely driven by foreign exchange (FX) reserves
recycling and lower revenues in Fixed Income and Currencies. Operating
expenses decreased in Q3 2025 to £269 million, largely driven by lower
litigation and conduct costs.
Financial performance
- Total income of £326 million decreased by £42 million compared with £368
million in Q2 2025, largely due to FX reserves recycling recognised in the
current quarter. In addition, revenues were lower in Fixed Income reflecting
challenging market conditions and reduced client activity, and in Currencies
following a strong Q2 2025 performance. Total income increased by £42 million
compared with £284 million in Q3 2024, mainly driven by an increase from the
amount recognised under the profit share arrangement with fellow NatWest Group
subsidiaries, and stronger performances in Currencies and Capital Markets,
partially offset by lower Fixed Income revenues.
- Operating expenses of £269 million in Q3 2025 were £75 million lower than
£344 million in Q2 2025 and £15 million higher than £254 million in Q3
2024. Litigation and conduct costs of £26 million credit reflected ongoing
progress in closing legacy matters including associated remediation activity,
and were down by £59 million compared with £33 million in Q2 2025 and by
£49 million compared with £23 million in Q3 2024. Other operating expenses
of £295 million were down by £16 million compared with £311 million in Q2
2025, largely due to VAT recoveries in the current quarter, and up by £64
million compared with £231 million in Q3 2024, largely due to increases in
technology investment costs and staff costs, in addition to lower VAT
recoveries compared with Q3 2024.
- Total assets and liabilities increased by £6.1 billion and £6.2 billion to
£189.3 billion and £182.4 billion respectively at 30 September 2025,
compared with 31 December 2024. Increases in funded assets including
settlement balances, trading assets and loans to customers were offset by
lower derivative fair values reflecting FX rate volatility across major
currencies and variations in interest rates across different currencies and
tenors.
Capital and leverage
- Total NWM Plc RWAs were £21.7 billion at 30 September 2025, compared with
£21.2 billion at 30 June 2025 and £20.8 billion at 31 December 2024. The
increase since 31 December 2024 was primarily driven by higher credit risk and
an increase from the annual update to operational risk RWAs, partially offset
by a reduction in market risk reflecting active risk management.
- NWM Plc's Common Equity Tier 1 (CET1) ratio decreased to 17.5% at 30 September
2025, compared with 18.2% at 31 December 2024, mainly due to the increase in
RWAs.
- Total MREL for NWM Plc at 30 September 2025 was £10.0 billion, in line with
31 December 2024, as the issuance of a new MREL instrument with NatWest Group
plc of €580 million was offset by lower Tier 1 capital. The decrease in Tier
1 capital was driven by the redemption of AT1 capital notes with NatWest Group
plc of $1.15 billion, partially offset by the issuance of two new AT1
instruments to NatWest Group plc amounting to £600 million. The MREL ratio
decreased to 46.1% of RWAs at 30 September 2025 compared with 48.2% at 31
December 2024, reflecting the increase in RWAs in the period.
- NWM Plc's leverage ratio decreased to 4.5% at 30 September 2025 compared with
5.5% at 31 December 2024, driven by the decrease in Tier 1 capital and higher
leverage exposure reflecting increases in trading assets and other financial
assets.
Liquidity and funding
- NWM Plc's Liquidity Coverage Ratio (LCR) increased to 203% (31 December 2024 -
195%), driven by lower net outflows partially offset by the decrease in
liquidity portfolio of £2.0 billion to £19.0 billion at 30 September 2025.
- NWM Plc issued public benchmark transactions amounting to £5.4 billion in the
nine months ended 30 September 2025. These transactions comprised €3.25
billion and CHF0.2 billion of notes under our Euro Medium Term Note programme,
$2.5 billion of notes under our US Medium Term Note programme and AUD1.0
billion of notes under our AUD debt issuance programme. NWM Plc also raised
funding in other formats throughout the period including, but not limited to,
structured note issuance.
ESG highlights
Climate and transition finance have performed well, and as at the end of Q3
2025, we had delivered £4.3 billion towards the NatWest Group climate and
transition finance target to provide £200 billion in climate and transition
finance((1)) between 1 July 2025 and the end of 2030.
(1) The climate and transition finance framework is available on
natwestgroup.com.
Outlook((1))
We retain the Outlook guidance provided in the NatWest Markets Plc 2024 Annual
Report and Accounts.
(1) The guidance, targets, expectations and trends discussed in this
section represent management's current expectations and are subject to change,
including as a result of the factors described in the Risk Factors in the
NatWest Markets Plc 2024 Annual Report and Accounts, and the Summary Risk
Factors in the NatWest Markets Plc 2025 Interim Results. These statements
constitute forward-looking statements. Refer to Forward-looking statements in
this announcement.
Financial review
The table below presents an analysis of key lines of NWM Group's income
statement for the nine months and quarter ended 30 September 2025. Commentary
refers to the table below as well as the consolidated income statement shown
on page 6.
Nine months ended Quarter ended
30 September 30 September 30 September 30 June 30 September
2025 2024 2025 2025 2024
Income statement £m £m £m £m £m
Net interest income 353 347 109 120 110
Non-interest income 735 587 217 248 174
Total income 1,088 934 326 368 284
Litigation and conduct costs (39) (61) 26 (33) (23)
Other operating expenses (897) (785) (295) (311) (231)
Operating expenses (936) (846) (269) (344) (254)
Operating profit before impairment losses/releases 152 88 57 24 30
Impairment (losses)/releases (1) 8 (4) 4 1
Operating profit before tax 151 96 53 28 31
Tax credit/(charge) 64 7 73 2 (11)
Profit for the period 215 103 126 30 20
Income (1)
Fixed Income 128 170 23 41 41
Currencies 485 379 158 169 139
Capital Markets 559 502 189 189 171
Capital Management Unit & other (2) (28) (38) (30) (11) (27)
Income including shared revenue before OCA 1,144 1,013 340 388 324
Transfer pricing arrangements with fellow
NatWest Group subsidiaries (3) (59) (74) (14) (17) (42)
Income excluding OCA 1,085 939 326 371 282
Own credit adjustments (OCA) 3 (5) - (3) 2
Total income 1,088 934 326 368 284
(1) Product performance includes gross income earned on a NatWest
Group-wide basis, including amounts contributed to other NatWest Group
subsidiaries. Income including shared revenue before OCA includes revenue
share from other NatWest Group subsidiaries but before revenue share is paid
to or contributed to those subsidiaries.
(2) Capital Management Unit was set up in Q3 2020 to manage capital
usage and optimisation across all parts of NatWest Markets, with the income
materially relating to legacy positions.
(3) Transfer pricing arrangements with fellow NatWest Group
subsidiaries includes shared revenue paid to or contributed to those
subsidiaries and a profit share arrangement with fellow NatWest Group
subsidiaries. The profit share arrangement rewards NWM Group on an arm's
length basis for its contribution to the performance of the NatWest Group
Commercial & Institutional business segment. The profit share is not
allocated to individual NatWest Markets product areas.
Nine months ended 30 September 2025 performance
- Net interest income largely represents interest income from lending activity
and capital hedges, offset by interest expense from the funding costs of the
business. The increase of £6 million compared with the nine months ended 30
September 2024 largely reflects growth in lending activity, partially offset
by the impact of one-off items.
- Non-interest income increased by £148 million compared with the period ended
30 September 2024. This rise was largely driven by stronger performances in
Currencies, which reflected the successful navigation of volatile market
conditions, and in Capital Markets, in addition to an increase of £26 million
from the profit share arrangement with fellow NatWest Group subsidiaries, with
£126 million being recognised in the period. This was partially offset by
lower revenues in Fixed Income, reflecting challenging market conditions and
reduced client activity.
- Operating expenses increased by £90 million compared with the nine months
ended 30 September 2024. Litigation and conduct costs reflected ongoing
progress on closing legacy matters including associated remediation activity
and were down by £22 million. Other operating expenses increased by £112
million, largely driven by increases in technology investment costs, staff
costs, the impact of VAT recoveries, and a credit recognised in the
comparative period in relation to property charges, partially offset by a
reduction in severance costs.
- The tax credit of £64 million on the operating profit before tax of £151
million differs from the expected UK corporation tax rate of 25%, primarily
due to a revision in our estimate of deductible costs in current and prior
periods.
Quarter ended 30 September 2025 performance
- Net interest income decreased by £11 million compared with Q2 2025, largely
due to higher interest expense from funding of the trading business and the
impact of one-off items.
- Non-interest income decreased by £31 million compared with Q2 2025. This was
largely driven by FX reserves recycling of £30 million debit recognised in
the current quarter on the redemption of $1.15 billion of AT1 capital notes
with NatWest Group plc and in connection with a subsidiary capital repayment.
In addition, revenues were lower in Fixed Income reflecting challenging market
conditions and reduced client activity, and in Currencies following a strong
Q2 2025 performance. Non-interest income increased by £43 million compared
with Q3 2024, mainly due to an increase of £28 million from the profit share
arrangement with fellow NatWest Group subsidiaries, with £47 million
recognised in Q3 2025, and stronger performances in Currencies and Capital
Markets, partially offset by lower Fixed Income revenues.
- Operating expenses decreased by £75 million compared with Q2 2025 and
increased by £15 million compared with Q3 2024. Litigation and conduct costs
reflected ongoing progress on closing legacy matters including associated
remediation activity and were down by £59 million compared with Q2 2025 and
by £49 million compared with Q3 2024. Other operating expenses decreased by
£16 million compared with Q2 2025, largely due to VAT recoveries in the
current quarter, and increased by £64 million compared with Q3 2024, largely
due to increases in technology investment costs, staff costs, and lower VAT
recoveries compared with Q3 2024.
- The tax credit of £73 million on the operating profit before tax of £53
million differs from the expected UK corporation tax rate of 25%, primarily
due to a revision in our estimate of deductible costs from current and prior
periods.
Financial review
Balance sheet profile as at 30 September 2025
NWM Group's balance sheet profile is summarised below. Commentary refers to
the table below as well as the consolidated balance sheet on page 8.
Assets Liabilities
30 September 31 December 30 September 31 December
2025 2024 2025 2024
£bn £bn £bn £bn
Cash and balances at central banks 17.1 16.2
Securities 23.4 13.9 12.1 10.5 Short positions
Reverse repos (1) 27.4 27.1 33.6 30.6 Repos (2)
Derivative cash collateral given (3) 5.6 7.3 11.5 12.3 Derivative cash collateral received (4)
Other trading assets 0.4 0.6 1.1 1.1 Other trading liabilities
Total trading assets 56.8 48.9 58.3 54.5 Total trading liabilities
Loans - amortised cost 23.6 19.1 18.2 9.4 Deposits - amortised cost
Settlement balances 12.1 2.0 9.1 1.7 Settlement balances
Amounts due from holding company Amounts due to holding company
and fellow subsidiaries 0.4 0.3 7.1 6.8 and fellow subsidiaries
Other financial assets 17.5 17.9 35.1 31.3 Other financial liabilities
Other assets 0.5 0.7 0.4 0.5 Other liabilities
Funded assets 128.0 105.1 128.2 104.2 Liabilities excluding derivatives
Derivative assets 61.3 78.1 54.2 72.0 Derivative liabilities
Total assets 189.3 183.2 182.4 176.2 Total liabilities
of which:
36.4 32.5 Wholesale funding (5)
17.2 16.8 Short-term wholesale funding (5)
(1) Comprises bank reverse repos of £5.0 billion (31 December 2024 - £5.9
billion) and customer reverse repos of £22.4 billion (31 December 2024 -
£21.2 billion).
(2) Comprises bank repos of £8.1 billion (31 December 2024 - £7.2 billion) and
customer repos of £25.5 billion (31 December 2024 - £23.4 billion).
(3) Comprises derivative cash collateral given relating to banks of £2.9 billion
(31 December 2024 - £3.6 billion) and customers of £2.7 billion (31 December
2024 - £3.7 billion).
(4) Comprises derivative cash collateral received relating to banks of £4.3
billion (31 December 2024 - £5.3 billion) and customers of £7.2 billion (31
December 2024 - £7.0 billion).
(5) Wholesale funding predominantly comprises bank deposits (excluding repos),
debt securities in issue and third party subordinated liabilities, of which
short-term wholesale funding is the amount with contractual maturity of one
year or less.
- Total assets and liabilities increased by £6.1 billion and £6.2
billion respectively at 30 September 2025. Funded assets, which exclude
derivatives, increased by £22.9 billion, mainly driven by higher settlement
balances, trading assets, and loans - amortised cost. Derivative fair values
decreased in the period, largely driven by FX rate volatility across major
currencies and variations in interest rates across different currencies and
tenors.
- Trading assets were up by £7.9 billion, driven by an increase in
securities from client-led activity, partially offset by a decrease in
derivative cash collateral posted. Trading liabilities increased by £3.8
billion, driven by increases in repos and short positions, partially offset by
a decrease in derivative cash collateral received.
- Loans - amortised cost increased by £4.5 billion, driven by higher
loans to customers reflecting growth in Capital Markets.
- Deposits - amortised cost were up by £8.8 billion, driven by higher
bank deposits reflecting increased repo funding in the period, and an increase
in customer deposits in NWM N.V.
- Settlement balance assets and liabilities were up by £10.1 billion
and £7.4 billion respectively, largely due to increased trading compared with
the seasonally lower levels of customer activity leading up to 31 December
2024.
- Other financial liabilities increased by £3.8 billion, largely driven
by new issuance in the period, partially offset by maturities. The balance at
30 September 2025 includes £25.6 billion of medium-term notes issued.
- Derivative assets and derivative liabilities were down by £16.8
billion and £17.8 billion respectively at 30 September 2025. The decreases in
fair values largely reflected FX volatility across major currencies including
the weakening of USD in the
period, following contrasting trends in Q4 2024, and variations in interest
rates across different currencies and tenors.
Non-IFRS measures
This document contains a number of non-IFRS measures. For details of the basis
of preparation and reconciliations, where applicable, refer to the non-IFRS
measures section on page 13.
Capital, liquidity and funding risk
Introduction
NWM Group takes a comprehensive approach to the management of capital,
liquidity and funding, underpinned by frameworks, risk appetite and policies,
to manage and mitigate capital, liquidity and funding risks. The framework
ensures the tools and capability are in place to facilitate the management and
mitigation of risk ensuring that NWM Group operates within its regulatory
requirements and risk appetite.
Capital, RWAs and leverage
Capital resources, RWAs and leverage for NWM Plc are set out below and have
been calculated in line with the PRA rulebook, subject to the requirements set
out in the UK CRR. Regulatory capital is monitored and reported at legal
entity level for large subsidiaries of NatWest Group.
30 September 30 June 31 December
2025 2025 2024
Capital adequacy ratios (1,2,4) % % %
CET1 17.5 17.1 18.2
Tier 1 22.0 25.9 24.3
Total 25.0 28.9 27.8
Total MREL 46.1 50.1 48.2
Capital (1,2,4) £m £m £m
CET1 3,801 3,627 3,779
Tier 1 4,776 5,508 5,067
Total 5,425 6,144 5,779
Total MREL (3) 10,001 10,635 10,038
Risk-weighted assets
Credit risk 9,896 9,389 8,908
Counterparty credit risk 5,907 6,063 5,797
Market risk 4,528 4,444 5,105
Operational risk 1,347 1,347 1,002
Total RWAs 21,678 21,243 20,812
(1) NWM Plc's total capital ratio requirement is 11.5%, comprising the Pillar 1
minimum capital requirement of 8%, supplemented with the capital conservation
buffer of 2.5% and the institution specific countercyclical buffer (CCyB) of
1.0%. The minimum CET1 ratio is 8.0%, including the minimum capital
requirement of 4.5%. The CCyB is based on the weighted average of NWM Plc's
geographical exposures.
(2) In addition, NWM Plc is subject to Pillar 2A requirements for CET1, AT1 and
Tier 2. Refer to the NatWest Markets Plc Q3 2025 Pillar 3 report for further
details on these additional capital requirements.
(3) Includes senior internal debt instruments issued to NatWest Group plc with a
nominal value of £4.6 billion (30 June 2025 - £4.5 billion; 31 December 2024
- £4.3 billion).
(4) The IFRS 9 transitional capital rules in respect to ECL provisions no longer
apply as of 1 January 2025.
Leverage
The leverage ratio has been calculated in accordance with the Leverage Ratio
(CRR) part of the PRA rulebook.
30 September 30 June 31 December
2025 2025 2024
Tier 1 capital (£m) 4,776 5,508 5,067
Leverage exposure (£m) (1) 106,006 98,840 92,859
Leverage ratio (%) 4.5 5.6 5.5
(1) Leverage exposure is broadly aligned to the accounting value of on and
off-balance sheet exposures albeit subject to specific adjustments for
derivatives, securities financing positions and off-balance sheet exposures.
Liquidity and funding
30 September 30 June 31 December
2025 2025 2024
LCR spot (%) (1) 203 197 195
LCR average (%) (1) 196 193 192
Liquidity portfolio (£bn) (1) 19.0 20.3 21.0
Total wholesale funding (£bn) (2) 36.4 35.3 32.5
Total funding including repo (£bn) 106.3 100.3 91.4
(1) LCR and Liquidity portfolio measures presented are for NWM Plc.
(2) Predominantly comprises bank deposits (excluding repos), debt securities in
issue and third party subordinated liabilities.
Condensed consolidated income statement
for the period ended 30 September 2025 (unaudited)
Nine months ended Quarter ended
30 September 30 September 30 September 30 June 30 September
2025 2024 2025 2025 2024
£m £m £m £m £m
Interest receivable 1,937 2,055 649 629 698
Interest payable (1,584) (1,708) (540) (509) (588)
Net interest income 353 347 109 120 110
Fees and commissions receivable 323 374 94 102 120
Fees and commissions payable (143) (166) (41) (46) (55)
Income from trading activities 572 428 181 199 199
Other operating income (17) (49) (17) (7) (90)
Non-interest income 735 587 217 248 174
Total income 1,088 934 326 368 284
Staff costs (393) (353) (128) (129) (112)
Premises and equipment (58) (55) (22) (15) (19)
Other administrative expenses (476) (431) (116) (197) (120)
Depreciation and amortisation (9) (7) (3) (3) (3)
Operating expenses (936) (846) (269) (344) (254)
Profit before impairment (losses)/releases 152 88 57 24 30
Impairment (losses)/releases (1) 8 (4) 4 1
Operating profit before tax 151 96 53 28 31
Tax credit/(charge) 64 7 73 2 (11)
Profit for the period 215 103 126 30 20
Attributable to:
Ordinary shareholders 130 43 104 (4) 3
Paid-in-equity holders 85 51 22 34 17
Non-controlling interests - 9 - - -
215 103 126 30 20
Condensed consolidated statement of comprehensive income
for the period ended 30 September 2025 (unaudited)
Nine months ended Quarter ended
30 September 30 September 30 September 30 June 30 September
2025 2024 2025 2025 2024
£m £m £m £m £m
Profit for the period 215 103 126 30 20
Items that do not qualify for reclassification
Remeasurement of retirement benefit schemes (3) (4) - - (1)
Changes in fair value of financial liabilities
designated at fair value through profit or loss (FVTPL) (11) (25) (10) (5) 1
Fair value through other comprehensive income (FVOCI)
financial assets 15 13 2 11 10
Tax - 16 (1) (4) (2)
1 - (9) 2 8
Items that do qualify for reclassification
FVOCI financial assets 5 4 5 (3) (2)
Cash flow hedges 92 25 (9) 74 98
Currency translation 27 (127) 90 (38) (77)
Tax (31) - - (19) (20)
93 (98) 86 14 (1)
Other comprehensive income/(loss) after tax 94 (98) 77 16 7
Total comprehensive income for the period 309 5 203 46 27
Attributable to:
Ordinary shareholders 224 (55) 181 12 10
Paid-in equity holders 85 51 22 34 17
Non-controlling interests - 9 - - -
309 5 203 46 27
Condensed consolidated balance sheet
as at 30 September 2025 (unaudited)
30 September 31 December
2025 2024
£m £m
Assets
Cash and balances at central banks 17,066 16,229
Trading assets 56,765 48,883
Derivatives 61,304 78,105
Settlement balances 12,141 2,043
Loans to banks - amortised cost 1,826 1,171
Loans to customers - amortised cost 21,732 17,921
Amounts due from holding company and fellow subsidiaries 393 343
Other financial assets 17,475 17,850
Other assets 567 621
Total assets 189,269 183,166
Liabilities
Bank deposits 9,562 4,565
Customer deposits 8,619 4,840
Amounts due to holding company and fellow subsidiaries 7,146 6,771
Settlement balances 9,074 1,729
Trading liabilities 58,317 54,512
Derivatives 54,160 72,036
Other financial liabilities 35,070 31,263
Other liabilities 415 521
Total liabilities 182,363 176,237
Owners' equity 6,906 6,929
Total equity 6,906 6,929
Total liabilities and equity 189,269 183,166
Condensed consolidated statement of changes in equity
for the period ended 30 September 2025 (unaudited)
Share
capital and Total Non
share Paid-in Retained Other owners' controlling Total
premium equity earnings reserves* equity interests equity
£m £m £m £m £m £m £m
At 1 January 2025 2,346 1,496 3,163 (76) 6,929 - 6,929
Profit attributable to ordinary
shareholders and paid-in equity holders 215 215 - 215
Other comprehensive income
- Realised gains in period on FVOCI equity shares 1 (1) - -
- Changes in fair value of
financial liabilities designated at FVTPL
due to changes in credit risk (11) (11) (11)
- Unrealised gains: FVOCI 19 19 19
- Remeasurement of retirement
benefit schemes (3) (3) (3)
- Amounts recognised in equity: cash flow hedges (84) (84) (84)
- Foreign exchange reserve movement 27 27 27
- Amounts transferred from equity to earnings 177 177 177
- Tax 1 (32) (31) (31)
Redemption of paid-in equity (903) 58 (845) (845)
Securities issued in the period 600 600 600
Paid-in equity dividends paid (85) (85) (85)
Share-based payments (3) (3) (3)
Sharing in success 1 1 1
Merger reserve amortisation (2) 2 - -
At 30 September 2025 2,346 1,193 3,335 32 6,906 - 6,906
30 September
2025
Attributable to: £m
Ordinary shareholders 5,713
Paid-in equity holders 1,193
Non-controlling interests -
6,906
*Other reserves consist of:
Merger reserve (9)
FVOCI reserve 41
Cash flow hedging reserve (114)
Foreign exchange reserve 114
32
Notes
1. Presentation of condensed consolidated financial statements
The condensed consolidated financial statements should be read in conjunction
with NatWest Markets Plc's 2024 Annual Report and Accounts. The accounting
policies are the same as those applied in the consolidated financial
statements.
The directors have prepared the condensed consolidated financial statements on
a going concern basis after assessing the principal risks, forecasts,
projections and other relevant evidence over the twelve months from the date
they are approved.
2. Trading assets and liabilities
Trading assets and liabilities comprise assets and liabilities held at fair
value in trading portfolios.
30 September 31 December
2025 2024
£m £m
Assets
Loans
Reverse repos 27,378 27,127
Collateral given 5,569 7,333
Other loans 404 545
Total loans 33,351 35,005
Securities
Central and local government
- UK 4,205 2,077
- US 5,960 3,734
- Other 9,196 3,506
Financial institutions and Corporate 4,053 4,561
Total securities 23,414 13,878
Total 56,765 48,883
Liabilities
Deposits
Repos 33,593 30,562
Collateral received 11,474 12,307
Other deposits 915 895
Total deposits 45,982 43,764
Debt securities in issue 231 257
Short positions 12,104 10,491
Total 58,317 54,512
Notes
3. Other financial liabilities
30 September 31 December
2025 2024
£m £m
Customer deposits - designated as at FVTPL 2,089 1,537
Debt securities in issue
- Medium term notes 25,626 21,852
- Commercial paper and certificates of deposit 7,079 7,605
Subordinated liabilities
- Designated as at FVTPL 241 234
- Amortised cost 35 35
Total 35,070 31,263
4. Amounts due to holding company and fellow subsidiaries
30 September 31 December
2025 2024
£m £m
Bank deposits - amortised cost 546 548
Customer deposits - amortised cost 52 43
Settlement balances 223 -
Trading liabilities 459 613
Other financial liabilities - subordinated liabilities 1,078 1,115
MREL instruments issued to NatWest Group plc 4,671 4,358
Other liabilities 117 94
Total 7,146 6,771
5. Litigation and regulatory matters
NatWest Markets Plc's Interim Results 2025, issued on 25 July 2025, included
disclosures about NWM Group's litigation and regulatory matters in Note 10.
Set out below are the material developments in those matters (which have been
previously disclosed) since publication of the Interim Results 2025.
Litigation
London Interbank Offered Rate (LIBOR) and other rates litigation
NatWest Group plc and certain other members of NatWest Group, including NWM
Plc, are defendants in a number of claims pending in the United States
District Court for the Southern District of New York (SDNY) with respect to
the setting of USD LIBOR. The complainants allege that certain members of
NatWest Group and other panel banks violated various federal laws, including
the US commodities and antitrust laws, and state statutory and common law, as
well as contracts, by manipulating LIBOR and prices of LIBOR-based derivatives
in various markets through various means.
The co-ordinated proceeding in the SDNY relating to USD LIBOR now includes one
remaining class action, which is on behalf of persons who purchased
LIBOR-linked instruments from defendants and bonds issued by defendants, as
well as several non-class actions. On 25 September 2025, the SDNY granted
summary judgment to the defendants on the issue of liability and dismissed all
claims in both the class action and the non-class actions. The decision
remains subject to appeal in the United States Court of Appeals for the Second
Circuit (US Court of Appeals).
Two other IBOR-related class actions involving NWM Plc, concerning alleged
manipulation of Euribor and Pound Sterling LIBOR, were previously dismissed by
the SDNY for various reasons. However, on 22 August 2025, the US Court of
Appeal reversed the SDNY's decision in the Euribor case, reinstating claims
against NWM Plc. That case will therefore return to the SDNY for further
proceedings.
On 15 September 2025, the US Court of Appeals affirmed the SDNY's dismissal of
the Pound Sterling LIBOR case.
Foreign exchange litigation
NWM Plc, NWMSI and/or NatWest Group plc are defendants in several cases
relating to NWM Plc's foreign exchange (FX) business.
In May 2025, NWM Plc executed an agreement to settle the claim in the Federal
Court of Australia, which the court approved in August 2025. The settlement
amount is covered in full by an existing provision.
Odd lot corporate bond trading antitrust litigation
In July 2024, the US Court of Appeals vacated the SDNY's October 2021
dismissal of the class action antitrust complaint alleging that, from August
2006 onwards, various securities dealers, including NWMSI, conspired
artificially to widen spreads for odd lots of corporate bonds bought or sold
in the United States secondary market and to boycott electronic trading
platforms that would have allegedly promoted pricing competition in the market
for such bonds.
Notes
5. Litigation and regulatory matters continued
The appellate court held that the district judge who made the decision should
not have been presiding over the case because a member of the judge's family
had owned stock in one of the defendants while the motion was pending.
On 2 September 2025, a different judge in the SDNY again dismissed the
complaint in this action on the ground that the plaintiffs have failed to
plead antitrust conspiracy. The plaintiffs did not appeal the decision within
the time required for an appeal.
US Anti-Terrorism Act litigation
NWM N.V. and certain other financial institutions are defendants in several
actions filed by a number of US nationals (or their estates, survivors, or
heirs), most of whom are, or were, US military personnel who were killed or
injured in attacks in Iraq between 2003 and 2011. NWM Plc is also a defendant
in some of these cases.
According to the plaintiffs' allegations, the defendants are liable for
damages arising from the attacks because they allegedly conspired with and/or
aided and abetted Iran and certain Iranian banks to assist Iran in
transferring money to Hezbollah and the Iraqi terror cells that committed the
attacks, in violation of the US Anti-Terrorism Act, by agreeing to engage in
'stripping' of transactions initiated by the Iranian banks so that the Iranian
nexus to the transactions would not be detected.
The first of these actions, alleging conspiracy claims but not aiding and
abetting claims, was filed in the United States District Court for the Eastern
District of New York in November 2014. In September 2019, the district court
dismissed the case, finding that the claims were deficient for several
reasons, including lack of sufficient allegations as to the alleged conspiracy
and causation. In January 2023, the US Court of Appeals affirmed the district
court's dismissal of this case.
On 30 September 2025, the district court denied a motion by the plaintiffs to
re-open the case to assert aiding and abetting claims that they previously did
not assert. Another action, filed in the SDNY in 2017, which asserted both
conspiracy and aiding and abetting claims, was dismissed by the SDNY in March
2019 on similar grounds as the first case, but remains subject to appeal to
the US Court of Appeals.
Other follow-on actions that are substantially similar to those described
above are pending in the same courts.
Regulatory matters
US investigations relating to fixed-income securities
In December 2021, NWM Plc pled guilty in the United States District Court for
the District of Connecticut to one count of wire fraud and one count of
securities fraud in connection with historical spoofing conduct by former
employees in US Treasuries markets between January 2008 and May 2014 and,
separately, during approximately three months in 2018. The 2018 trading
occurred during the term of a non-prosecution agreement (NPA) between NWMSI
and the United States Attorney's Office for the District of Connecticut (USAO
CT), under which non-prosecution was conditioned on NWMSI and affiliated
companies not engaging in criminal conduct during the term of the NPA. The
relevant trading in 2018 was conducted by two NWM traders in Singapore and
breached that NPA. The plea agreement reached with the US Department of
Justice (DOJ) and the USAO CT resolved both the spoofing conduct and the
breach of the NPA.
The DOJ and USAO CT paused the monitorship in May 2025 and, following a
review, determined that a monitorship was no longer necessary as a result of
NWM's notable progress in strengthening its compliance programme, certain of
NWM's remedial improvements, internal controls, and the status of
implementation of Monitor recommendations, and that reporting by NWM to the
DOJ and USAO CT on its continued compliance programme progress provided an
appropriate degree of oversight. The court approved the amended plea agreement
and extended NWM's obligations under the plea agreement and probation until
December 2026.
In the event that NWM Plc does not meet its obligations to the DOJ, this may
lead to adverse consequences such as increased costs, findings that NWM Plc
violated its probation term, and possible re-sentencing, amongst other
consequences. Other material adverse collateral consequences may occur as a
result of this matter, as further described in the Risk Factor relating to
legal, regulatory and governmental actions and investigations set out on pages
422-423 of the NatWest Group Annual Report and Accounts 2024.
6. Post balance sheet events
There have been no significant events between 30 September 2025 and the date
of approval of these accounts that would require a change to or additional
disclosure in the condensed consolidated financial statements.
Non-IFRS measures
NWM Group prepares its financial statements in accordance with UK-adopted
International Accounting Standards (IAS) and International Financial Reporting
Standards (IFRS). This document contains a number of non-IFRS measures, or
alternative performance measures, defined under the European Securities and
Markets Authority (ESMA) guidance, or non-Generally Accepted Accounting
Principles (GAAP) financial measures in accordance with the Securities and
Exchange Commission (SEC) regulations. These measures are adjusted for notable
and other defined items which management believes are not representative of
the underlying performance of the business and which distort period-on-period
comparison.
The non-IFRS measures provide users of the financial statements with a
consistent basis for comparing business performance between financial periods
and information on elements of performance that are one-off in nature. The
non-IFRS measures also include a calculation of metrics that are used
throughout the banking industry.
These non-IFRS measures are not a substitute for IFRS measures and a
reconciliation to the closest IFRS measure is presented where appropriate.
These measures include:
- Management analysis of operating expenses shows litigation and conduct
costs on a separate line. These amounts are included within staff costs and
other administrative expenses in the statutory analysis. Other operating
expenses excludes litigation and conduct costs which are more volatile and may
distort comparisons with prior periods.
- Funded assets are defined as total assets less derivative assets. This
measure allows review of balance sheet trends exclusive of the volatility
associated with derivative fair values.
- Management view of income by business including shared revenue and
before own credit adjustments. This measure is used to show underlying income
generation in NatWest Markets excluding the impact of own credit adjustments.
- Revenue share refers to income generated by NatWest Markets products
from customers that have their primary relationship with other NatWest Group
subsidiaries, a proportion of which is shared between NatWest Markets and
those subsidiaries.
- Transfer Pricing arrangements with fellow NatWest Group subsidiaries
includes revenue share and a profit share arrangement with fellow NatWest
Group subsidiaries. The profit share arrangement rewards NWM Group on an arm's
length basis for its contribution to the performance of the NatWest Group
Commercial & Institutional business segment. The profit share is not
allocated to individual NatWest Markets product areas.
- Own credit adjustments are applied to positions where it is believed
that the counterparties would consider NWM Group's creditworthiness when
pricing trades. The fair value of certain issued debt securities, including
structured notes, is adjusted to reflect the changes in own credit spreads and
the resulting gain or loss recognised in income.
Non-IFRS financial measures
Operating expenses - management view
Nine months ended
30 September 2025 30 September 2024
Litigation Other Statutory Litigation Other Statutory
and conduct operating operating and conduct operating operating
costs expenses expenses costs expenses expenses
£m £m £m £m £m £m
Staff costs 32 361 393 21 332 353
Premises and equipment 4 54 58 - 55 55
Other administrative expenses 3 473 476 40 391 431
Depreciation and amortisation - 9 9 - 7 7
Total 39 897 936 61 785 846
Quarter ended
30 September 2025
Litigation Other Statutory
and conduct operating operating
costs expenses expenses
£m £m £m
Staff costs 12 116 128
Premises and equipment 1 21 22
Other administrative expenses (39) 155 116
Depreciation and amortisation - 3 3
Total (26) 295 269
Quarter ended
30 June 2025
Litigation Other Statutory
and conduct operating operating
costs expenses expenses
£m £m £m
Staff costs 11 118 129
Premises and equipment - 15 15
Other administrative expenses 22 175 197
Depreciation and amortisation - 3 3
Total 33 311 344
Quarter ended
30 September 2024
Litigation Other Statutory
and conduct operating operating
costs expenses expenses
£m £m £m
Staff costs 8 104 112
Premises and equipment - 19 19
Other administrative expenses 15 105 120
Depreciation and amortisation - 3 3
Total 23 231 254
Additional information
Presentation of information
NatWest Markets Plc ('NWM Plc') is a wholly-owned subsidiary of NatWest Group
plc or 'the ultimate holding company'. The NatWest Markets Group ('NWM Group')
comprises NWM Plc and its subsidiary and associated undertakings. The term
'NatWest Group' or 'we' refers to NatWest Group plc and its subsidiaries.
The term NWM N.V. Group refers to NatWest Markets N.V. and its subsidiary and
associated undertakings. The term 'NWMSI' refers to NatWest Markets
Securities, Inc. The term 'NWH Group' refers to NatWest Holdings Limited
('NWH') and its subsidiary and associated undertakings. The term 'NatWest
Bank Plc' or 'NWB Plc' refers to National Westminster Bank Plc.
NWM Plc publishes its financial statements in pounds sterling ('£' or
'sterling'). The abbreviations '£m' and '£bn' represent millions and
thousands of millions of pounds sterling ('GBP'), respectively, and references
to 'pence' or 'p' represent pence in the United Kingdom ('UK'). References to
'dollars' or '$' are to United States of America ('US') dollars. The
abbreviations '$m' and '$bn' represent millions and thousands of millions of
dollars, respectively, and references to 'cents' represent cents in the United
States ('US'). The abbreviation '€' represents the 'euro', and the
abbreviations '€m' and '€bn' represent millions and thousands of millions
of euros, respectively, and references to 'cents' represent cents in the
European Union ('EU').
Statutory results
Financial information contained in this document does not constitute statutory
accounts within the meaning of section 434 of the Companies Act 2006 ("the
Act"). The statutory accounts for the year ended 31 December 2024 have been
filed with the Registrar of Companies. The report of the auditor on those
statutory accounts was unqualified, did not draw attention to any matters by
way of emphasis and did not contain a statement under section 498(2) or (3) of
the Act.
Contact
Paul Pybus Investor Relations +44 (0) 7769 161183
Forward-looking statements
Cautionary statement regarding forward-looking statements
Certain sections in this document contain 'forward-looking statements' as that
term is defined in the United States Private Securities Litigation Reform Act
of 1995, such as statements with respect to NWM Group's financial condition,
results of operations and business, including its strategic priorities,
financial, investment and capital targets, and ESG targets, commitments and
ambitions described herein. Statements that are not historical facts,
including statements about NatWest Group's beliefs and expectations, are
forward-looking statements. Words such as 'expect', 'estimate', 'project',
'anticipate', 'commit', 'believe', 'should', 'intend', 'will', 'plan',
'could', 'probability', 'risk', 'target', 'goal', 'objective', 'may',
'endeavour', 'outlook', 'optimistic', 'prospects' and similar expressions or
variations on these expressions are intended to identify forward-looking
statements. In particular, this document includes forward-looking targets and
guidance relating to financial performance measures, such as income growth,
operating expense, cost reductions, impairment loss rates, balance sheet
reduction (including the reduction of RWAs), CET1 ratio (and key drivers of
the CET1 ratio, including timing, impact and details), Pillar 2 and other
regulatory buffer requirements and MREL and non-financial performance
measures, such as climate and sustainability-related performance ambitions,
targets and metrics, including in relation to financed emissions and
initiatives to transition to a net zero economy, such as our climate and
transition financing activities.
Limitations inherent to forward-looking statements
These statements are based on current plans, expectations, estimates, targets
and projections, and are subject to significant inherent risks, uncertainties
and other factors, both external and relating to NatWest Group's and NWM
Group's strategy or operations, which may result in NWM Group being unable to
achieve the current plans, expectations, estimates, targets, projections and
other anticipated outcomes expressed or implied by such forward-looking
statements. In addition, certain of these disclosures are dependent on choices
relying on key model characteristics and assumptions and are subject to
various limitations, including assumptions and estimates made by management.
By their nature, certain of these disclosures are only estimates and, as a
result, actual future results, gains or losses could differ materially from
those that have been estimated. Accordingly, undue reliance should not be
placed on these statements. The forward-looking statements contained in this
document speak only as of the date we make them and we expressly disclaim any
obligation or undertaking to update or revise any forward-looking statements
contained herein, whether to reflect any change in our expectations with
regard thereto, any change in events, conditions or circumstances on which any
such statement is based, or otherwise, except to the extent legally required.
Important factors that could affect the actual outcome of the forward-looking
statements
We caution you that a large number of important factors could adversely affect
our results or our ability to implement our strategy, cause us to fail to meet
our targets, predictions, expectations and other anticipated outcomes or
affect the accuracy of forward-looking statements described in this document.
These factors include, but are not limited to, those set forth in the risk
factors and the other uncertainties described in NatWest Markets Plc's 2024
Annual Report and Accounts, NatWest Markets Plc's Interim Management Statement
for Q1, H1 and Q3 2025, and its other public filings. The principal risks and
uncertainties that could adversely affect NWM Group's future results, its
financial condition and/or prospects and cause them to be materially different
from what is forecast or expected, include, but are not limited to: economic
and political risk (including in respect of: economic and political risks and
uncertainties in the UK and global markets, including as a result of inflation
and interest rates, supply chain disruption, and geopolitical developments;
and changes in interest rates and foreign currency exchange rates; business
change and execution risk (including in respect of: NatWest Group's strategy
and NatWest Group's creation of its Commercial & Institutional business
segment (of which NWM Group forms part) and the transfer of NatWest Group's
Western European corporate portfolio); financial resilience risk (including in
respect of: NWM Group's ability to meet targets, generate returns or implement
its strategy effectively; prudential regulatory requirements for capital and
MREL; NWM Group's reliance on access to capital markets directly or indirectly
through its parent (NatWest Group); capital, funding and liquidity risk;
reductions in the credit ratings; the competitive environment; the
requirements of regulatory stress tests; counterparty and borrower risk; model
risk; sensitivity to accounting policies, judgments, estimates and assumptions
(and the economic, climate, competitive and other forward looking information
affecting those judgments, estimates and assumptions); changes in applicable
accounting standards; the adequacy of NatWest Group's resolution plans; and
the application of UK statutory stabilisation or resolution powers to NatWest
Group); climate and sustainability risk (including in respect of: risks
relating to climate change and sustainability-related risks; both the
execution and reputational risk relating to NatWest Group's climate
change-related strategy, ambitions, targets and transition plan; climate and
sustainability-related data and model risk; increasing levels of climate,
environmental, human rights and other sustainability-related laws, regulation
and oversight; climate, environmental, human rights and other
sustainability-related litigation, enforcement proceedings, investigations and
conduct risk); operational and IT resilience risk (including in respect of:
operational risks (including reliance on third party suppliers); cyberattacks;
the accuracy and effective use of data; attracting, retaining and developing
senior management and skilled personnel; complex IT systems; NWM Group's risk
management framework; and NWM Group's reputational risk); and legal,
regulatory and conduct risk (including in respect of: the impact of
substantial regulation and oversight; the outcome of legal, regulatory and
governmental actions and investigations as well as remedial undertakings; and
changes in tax legislation or failure to generate future taxable profits).
Forward-looking statements
Climate and sustainability-related disclosures
Climate and sustainability-related disclosures in this document are not
measures within the scope of International Financial Reporting Standards
('IFRS'), use a greater number and level of judgments, assumptions and
estimates, including with respect to the classification of climate and
transition financing activities, than our reporting of historical financial
information in accordance with IFRS. These judgments, assumptions and
estimates are highly likely to change materially over time, and, when coupled
with the longer time frames used in these disclosures, make any assessment of
materiality inherently uncertain. In addition, our climate risk analysis, our
ambition to be net zero across our financed emissions, assets under management
and operational value chain by 2050 and the implementation of our climate
transition plan remain under development, and the data underlying our analysis
and strategy remain subject to evolution over time. The process we have
adopted to define, gather and report data on our performance on climate and
sustainability-related measures is not subject to the formal processes adopted
for financial reporting in accordance with IFRS and there are currently
limited industry standards or globally recognised established practices for
measuring and defining climate (including transition and transition finance)
and sustainability-related metrics. As a result, we expect that certain
climate and sustainability-related disclosures made in this document are
likely to be amended, updated, recalculated or restated in the future. Refer
to the cautionary statement in the section entitled 'Climate and
sustainability-related and other forward-looking statements and metrics' of
the NatWest Group 2024 Sustainability Report published by NatWest Group plc
for the consolidated group, including NatWest Markets Plc.
Cautionary statement regarding alternative performance measures
NWM Group prepares its financial statements in accordance with UK-adopted
International Accounting Standards (IAS) and IFRS. This document may contain
non-IFRS measures, or alternative performance measures, defined under the
European Securities and Markets Authority (ESMA) guidance, or non-GAAP
financial measures in accordance with the Securities and Exchange Commission
(SEC) regulations (together, APMs). APMs are adjusted for notable and other
defined items which management believes are not representative of the
underlying performance of the business and which distort period-on-period
comparison. APMs provide users of the financial statements with a consistent
basis for comparing business performance between financial periods and
information on elements of performance that are one-off in nature. APMs
included in this document, are not measures within the scope of IFRS or GAAP,
are based on a number of assumptions that are subject to uncertainties and
change, and are not a substitute for IFRS or GAAP measures and a
reconciliation to the closest IFRS or GAAP measure is presented where
appropriate.
The information, statements and opinions contained in this document do not
constitute a public offer under any applicable legislation or an offer to sell
or a solicitation of an offer to buy any securities or financial instruments
or any advice or recommendation with respect to such securities or other
financial instruments.
Legal Entity Identifier: RR3QWICWWIPCS8A4S074
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