REG - Natwest Markets PLC NatWest Markets N.V. - NatWest Markets Plc Interim Results 2025
25/07/2025 08:15
For best results when printing this announcement, please click on link below:
https://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20250725:nRSY5184Sa&default-theme=true
RNS Number : 5184S Natwest Markets PLC 25 July 2025
NatWest Markets Group
Interim Results 2025
NatWest Markets Plc
ci.natwest.com
NatWest Markets Group (NWM Group)
Results for the half year ended 30 June 2025
The first half of the year saw a dynamic operating environment, with strong
client activity against a backdrop of heightened geopolitical uncertainty. We
captured opportunities presented by this environment, leveraged our deep
customer relationships and capitalised on our strengths through a connected
Commercial & Institutional segment, enabling us to extend the reach of our
proposition. As a result, we produced a strong set of results for NWM Group,
underpinned by a disciplined approach to balance sheet and risk management.
Financial review
NWM Group maintained its robust capital and liquidity position in H1 2025 and
reported a profit of £89 million, compared with a profit of £83 million in
H1 2024. Total income of £762 million increased by £112 million compared
with H1 2024, largely due to a stronger performance in Currencies and Capital
Markets. Operating expenses increased by £75 million to £667 million, due to
higher litigation and conduct costs, and other operating expenses, mainly
driven by the impact of a credit recognised in the comparative period in
relation to property charges and an increase in staff costs.
Financial performance
- Total income of £762 million increased by £112 million compared
with £650 million in H1 2024, largely due to a stronger performance in
Currencies as we successfully navigated volatile market conditions, and
Capital Markets partially offset by lower Fixed Income revenues.
- Operating expenses of £667 million in H1 2025 were £75 million
higher than £592 million in H1 2024. Litigation and conduct costs increased
by £27 million to £65 million, as work continued on closing legacy matters
including associated remediation activity. Other operating expenses increased
by £48 million to £602 million in H1 2025, largely driven by the impact of a
credit recognised in the comparative period in relation to property charges
and increases in staff costs, partially offset by the impact of severance
costs recognised in H1 2024.
- NWM Group's total assets and liabilities increased by £12.6 billion and
£12.0 billion to £195.8 billion and £188.2 billion respectively at 30 June
2025, compared with 31 December 2024. Increases in funded assets including
trading assets and settlement balances were offset by lower derivative fair
values reflecting FX volatility across major currencies and variations in
interest rates across different currencies and tenors.
Capital and leverage
- Total NWM Plc RWAs were £21.2 billion at 30 June 2025, compared with
£20.8 billion at 31 December 2024. The increase in the period was primarily
driven by the annual update to operational risk RWAs and increases in credit
and counterparty credit risk, largely offset by a reduction in market risk
reflecting active risk management.
- NWM Plc's Common Equity Tier 1 (CET1) ratio decreased to 17.1% at 30
June 2025 compared with 18.2% at 31 December 2024, mainly due to a reduction
in CET1 capital largely driven by regulatory deductions and reserve movements,
and the increase in RWAs.
On 2 July 2025, NatWest Group plc gave notice of the upcoming
redemption of Additional Tier 1 (AT1) capital notes of $1.15 billion on 10
August 2025. These notes were downstreamed to NWM Plc, and the announcement
and redemption of the notes will result in an increase of approximately £59
million to NWM Plc's CET1 capital.
- Total MREL for NWM Plc at 30 June 2025 increased to £10.6 billion, or
50.1% of RWAs, compared with £10.0 billion or 48.2% of RWAs at 31 December
2024, largely due to an increase in Tier 1 capital driven by the issuance of
two new Additional Tier 1 (AT1) instruments to NatWest Group plc amounting to
£600 million, and the issuance of a new MREL instrument with NatWest Group
plc of €580 million.
- NWM Plc's leverage ratio at 30 June 2025 was 5.6%, up slightly
compared with 5.5% at 31 December 2024, as the impact from higher Tier 1
capital was largely offset by an increase in leverage exposure driven by
higher trading assets and other financial assets.
Liquidity and funding
- NWM Plc's Liquidity Coverage Ratio (LCR) increased to 197% (31
December 2024 - 195%), driven by lower net outflows partially offset by the
decrease in liquidity portfolio of £0.7 billion to £20.3 billion at 30 June
2025.
- NWM Plc issued public benchmark transactions amounting to £4.3
billion in the six months ended 30 June 2025. Transactions comprised €2.0
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
The NatWest Group climate and sustainable funding and financing target((1)) of
£100 billion between 1 July 2021 and the end of 2025 was exceeded in Q1 2025,
of which NWM Group had delivered £57.3 billion as at 30 June 2025. To reflect
this progress, NatWest Group has announced a new target to provide £200
billion in climate and transition finance((2)) between 1 July 2025 and the end
of 2030.
(1) Up until 30 June 2025, NatWest Group used its climate and
sustainable funding and financing inclusion criteria (CSFFI criteria) to
determine the assets, activities and companies that were eligible to be
included within its climate and sustainable funding and financing target. This
included provision of committed (on and off-balance sheet) funding and
financing, including provision of services for underwriting issuances and
private placements.
(2) 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' section
in the NatWest Markets Plc 2024 Annual Report and Accounts, and the 'Summary
Risk Factors' in this announcement. 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 half year and quarter ended 30 June 2025. Commentary refers
to the tables below as well as the condensed consolidated income statement
shown on page 19.
Half year ended Quarter ended
30 June 30 June 30 June 31 March 30 June
2025 2024 2025 2025 2024
Income statement £m £m £m £m £m
Net interest income 244 237 120 124 116
Non-interest income 518 413 248 270 207
Total income 762 650 368 394 323
Litigation and conduct costs (65) (38) (33) (32) (39)
Other operating expenses (602) (554) (311) (291) (298)
Operating expenses (667) (592) (344) (323) (337)
Operating profit/(loss) before impairment releases/losses 95 58 24 71 (14)
Impairment releases/(losses) 3 7 4 (1) (1)
Operating profit/(loss) before tax 98 65 28 70 (15)
Tax (charge)/credit (9) 18 2 (11) 16
Profit for the period 89 83 30 59 1
Income (1)
Fixed Income 105 129 41 64 66
Currencies 327 240 169 158 128
Capital Markets 370 331 189 181 166
Capital Management Unit & other (2) 2 (11) (11) 13 (11)
Income including shared revenue before OCA 804 689 388 416 349
Transfer pricing arrangements with fellow NatWest Group subsidiaries (3) (45) (32) (17) (28) (24)
Income excluding OCA 759 657 371 388 325
Own credit adjustments (OCA) 3 (7) (3) 6 (2)
Total income 762 650 368 394 323
(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.
Half year ended 30 June 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 £7 million compared with H1 2024 largely
reflects growth in lending activity.
- Non-interest income increased by £105 million compared with H1 2024,
mainly due to a stronger performance in Currencies as we successfully
navigated volatile market conditions, partially offset by lower Fixed Income
revenues. The amount recognised under the profit share arrangement with fellow
NatWest Group subsidiaries was £79 million in the current period, down from
£81 million in H1 2024.
- Operating expenses in H1 2025 increased by £75 million compared with
H1 2024. Litigation and conduct costs in H1 2025 reflected ongoing progress on
closing legacy matters including any associated remediation activity and were
up by £27 million compared with H1 2024. Other operating expenses increased
by £48 million compared with H1 2024, largely driven by the impact of a
credit recognised in the comparative period in relation to property charges
and increases in staff and technology investment costs, partially offset by
the impact of severance costs recognised in H1 2024.
Quarter ended 30 June 2025 performance
- Net interest income for the quarter was comparable with Q1 2025 and Q2
2024.
- Non-interest income decreased by £22 million compared to Q1 2025,
mainly due to a weaker performance in Fixed Income, the non-repeat of one-off
gains in the comparative period and fair value movements relating to funding
positions in Capital Management Unit & other, and lower own credit
adjustments. This was partially offset by higher revenues in Currencies and
Capital Markets, and an increase of £11 million in the amount recognised
under the profit share arrangement with fellow NatWest Group subsidiaries,
where £45 million was recognised in Q2 2025. Non-interest income increased by
£41 million compared with Q2 2024, mainly due to stronger performances in
Currencies and Capital Markets, and an increase of £9 million in the amount
recognised under the profit share arrangement, partially offset by lower Fixed
Income revenues.
- Operating expenses increased by £21 million compared with Q1 2025 and
by £7 million compared to Q2 2024. Litigation and conduct costs reflected
ongoing progress on closing legacy matters including any associated
remediation activity and were up by £1 million compared with Q1 2025 and down
by £6 million compared with Q2 2024. Other operating expenses increased by
£20 million compared with Q1 2025, largely due to higher technology
investment costs partially offset by lower staff costs, and increased by £13
million compared with Q2 2024, largely due to increases in staff and
technology investment costs, partially offset by the impact of severance costs
recognised in the comparative period.
Financial review
Balance sheet profile as at 30 June 2025
NWM Group's balance sheet profile is summarised below. Commentary refers to
the table below as well as the condensed consolidated balance sheet on page
20.
Assets Liabilities
30 June 31 December 30 June 31 December
2025 2024 2025 2024
£bn £bn £bn £bn
Cash and balances at central banks 18.6 16.2
Securities 21.5 13.9 12.2 10.5 Short positions
Reverse repos (1) 28.2 27.1 33.9 30.6 Repos (2)
Derivative cash collateral given (3) 6.2 7.3 11.5 12.3 Derivative cash collateral received (4)
Other trading assets 0.7 0.6 1.1 1.1 Other trading liabilities
Total trading assets 56.6 48.9 58.7 54.5 Total trading liabilities
Loans - amortised cost 21.9 19.1 12.4 9.4 Deposits - amortised cost
Settlement balances 8.1 2.0 9.3 1.7 Settlement balances
Amounts due from holding Amounts due to holding company
company and fellow subsidiaries 0.4 0.3 6.9 6.8 and fellow subsidiaries
Other financial assets 17.0 17.9 34.6 31.3 Other financial liabilities
Other assets 0.7 0.7 0.5 0.5 Other liabilities
Funded assets 123.3 105.1 122.4 104.2 Liabilities excluding derivatives
Derivative assets 72.5 78.1 65.8 72.0 Derivative liabilities
Total assets 195.8 183.2 188.2 176.2 Total liabilities
of which:
35.3 32.5 Wholesale funding (5)
16.7 16.8 Short-term wholesale funding (5)
Net derivative assets (6) 3.1 2.4 2.9 3.5 Net derivative liabilities (6)
(1) Comprises bank reverse repos of £6.3 billion (31 December 2024 - £5.9
billion) and customer reverse repos of £21.9 billion (31 December 2024 -
£21.2 billion).
(2) Comprises bank repos of £9.6 billion (31 December 2024 - £7.2 billion) and
customer repos of £24.3 billion (31 December 2024 - £23.4 billion).
(3) Comprises derivative cash collateral given relating to banks of £3.0 billion
(31 December 2024 - £3.6 billion) and customers of £3.2 billion (31 December
2024 - £3.7 billion).
(4) Comprises derivative cash collateral received relating to banks of £4.5
billion (31 December 2024 - £5.3 billion) and customers of £7.0 billion (31
December 2024 - £7.0 billion).
(5) 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.
(6) Refer to page 11 for further details.
- Total assets and liabilities increased by £12.6 billion and £12.0
billion respectively at 30 June 2025. Funded assets, which exclude
derivatives, increased by £18.2 billion, largely driven by higher trading
assets, settlement balances, loans - amortised cost and cash and balances at
central banks. 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.
- Cash and balances at central banks increased by £2.4 billion mainly
driven by increased customer deposits and new issuances, partially offset with
planned banking book growth and maturities.
- Trading assets were up by £7.7 billion, driven by an increase in
securities from client-led activity, and reverse repos, partially offset by a
decrease in derivative cash collateral posted. Trading liabilities increased
by £4.2 billion, driven by increases in repos and short positions, partially
offset by a decrease in derivative cash collateral received.
- Loans - amortised cost increased by £2.8 billion, driven by higher
loans to customers reflecting growth in Capital Markets.
- Deposits - amortised cost were up by £3.0 billion, largely driven by
an increase in customer deposits in NWM N.V..
- Derivative assets and derivative liabilities were down by £5.6
billion and £6.2 billion respectively at 30 June 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.
- Other financial liabilities increased by £3.3 billion, largely driven
by new issuance in the period, partially offset by maturities. The balance at
30 June 2025 includes £25.1 billion of medium-term notes issued.
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 43.
Risk and capital management
Page
Market risk
One-day 99% traded internal VaR 4
Capital, liquidity and funding risk
Capital, RWAs and leverage 5
Capital resources 6
Leverage exposure 7
Liquidity portfolio 7
Funding sources 8
Senior notes and subordinated liabilities 9
Credit risk
Credit risk - Trading activities 10
Credit risk - Economics 12
Credit risk - Banking activities 16
Certain disclosures in the Risk and capital management section are within the
scope of EY's review report and are marked as 'reviewed' in the section
header.
Market risk (reviewed)
One-day 99% traded internal VaR
The table below shows one-day 99% internal VaR for the trading portfolios of
NWM Group, split by exposure type.
Half year ended
30 June 2025 30 June 2024 31 December 2024
Period Period Period
Average Maximum Minimum end Average Maximum Minimum end Average Maximum Minimum end
£m £m £m £m £m £m £m £m £m £m £m £m
Interest rate 3.6 5.4 2.2 4.1 6.7 12.0 3.6 6.6 6.5 12.1 3.0 3.8
Credit spread 5.3 7.2 4.0 4.6 8.1 10.1 6.7 7.6 7.3 9.6 5.6 5.6
Currency 1.5 4.0 - 0.8 2.1 6.7 0.8 1.9 1.9 5.8 0.5 1.3
Equity - 0.1 - 0.1 0.1 0.1 0.1 0.1 0.1 0.3 - -
Diversification (1) (3.9) (4.0) (6.8) (5.5) (5.8) (5.4)
Total 6.5 9.7 4.3 5.6 10.2 16.2 7.0 10.7 10.0 16.1 5.3 5.3
(1) NWM Group benefits from diversification across various financial
instrument types, currencies and markets. The extent of the diversification
benefit depends on the correlation between the assets and risk factors in the
portfolio at a particular time. The diversification factor is the sum of the
VaR on individual risk types less the total.
- Both interest rate VaR and credit spread VaR decreased on an average
basis.
- This reflects the period of higher market volatility in H2 2022
rolling out of the VaR calculation window.
Risk and capital management
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 June 31 December
2025 2024
Capital adequacy ratios (1,2,4) % %
CET1 17.1 18.2
Tier 1 25.9 24.3
Total 28.9 27.8
Total MREL 50.1 48.2
Capital (1,2,4) £m £m
CET1 3,627 3,779
Tier 1 5,508 5,067
Total 6,144 5,779
Total MREL (3) 10,635 10,038
Risk-weighted assets
Credit risk 9,389 8,908
Counterparty credit risk 6,063 5,797
Market risk 4,444 5,105
Operational risk 1,347 1,002
Total RWAs 21,243 20,812
(1) NWM Plc's total capital ratio requirement is 11.5%, comprising the minimum
capital requirement of 8%, supplemented with the capital conservation buffer
of 2.5% and the institution specific countercyclical buffer (CCyB) of 1%. The
minimum CET1 ratio is 8%, 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
T2. Refer to the NatWest Markets Plc 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 £4.5 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 June 31 December
2025 2024
Tier 1 capital (£m) 5,508 5,067
Leverage exposure (£m) (1) 98,840 92,859
Leverage ratio (%) 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.
Risk and capital management
Capital, liquidity and funding risk continued
Capital resources (reviewed)
NWM Plc's regulatory capital is assessed against minimum requirements that are
set out under the UK CRR to determine the strength of its capital base. The
table below shows a reconciliation of shareholders' equity to regulatory
capital.
30 June 31 December
2025 2024
Shareholders' equity £m £m
Shareholders' equity 7,467 6,819
Other equity instruments (2,096) (1,496)
5,371 5,323
Regulatory adjustments and deductions
Own credit 34 37
Defined benefit pension fund adjustment (113) (109)
Cash flow hedging reserve 128 203
Prudential valuation adjustments (133) (148)
Expected losses less impairments (13) (6)
Instruments of financial sector entities where the institution has a (1,604) (1,521)
significant investment
Other adjustments for regulatory purposes (43) -
(1,744) (1,544)
CET1 capital 3,627 3,779
Additional Tier 1 (AT1) capital
Qualifying instruments and related share premium 2,095 1,496
Tier 1 deductions
Instruments of financial sector entities where the institution has a (214) (208)
significant investment
Tier 1 capital 5,508 5,067
Qualifying Tier 2 capital
Qualifying instruments and related share premium 1,029 1,124
Tier 2 deductions
Instruments of financial sector entities where the institution has a (400) (419)
significant investment
Other regulatory adjustments 7 7
(393) (412)
Tier 2 capital 636 712
Total regulatory capital 6,144 5,779
Risk and capital management
Capital, liquidity and funding risk continued
Leverage exposure
The leverage exposure has been calculated in accordance with the Leverage
Exposure (CRR) part of the PRA rulebook.
30 June 31 December
2025 2024
Leverage £m £m
Cash and balances at central banks 9,966 11,069
Trading assets 29,905 26,186
Derivatives 69,637 74,982
Financial assets 41,187 37,408
Other assets 7,100 3,292
Total assets 157,795 152,937
Derivatives
- netting (66,139) (72,159)
- potential future exposures 15,452 15,093
Securities financing transactions gross up 1,769 1,959
Undrawn commitments 7,551 8,638
Regulatory deductions and other adjustments (7,351) (2,266)
Exclusion of core UK-group exposures (283) (288)
Claims on central banks (9,954) (11,055)
Leverage exposure 98,840 92,859
Liquidity portfolio (reviewed)
The table below shows the composition of the liquidity portfolio with primary
liquidity aligned to high-quality liquid assets on a regulatory LCR basis.
Secondary liquidity comprises of assets which are eligible as collateral for
local central bank liquidity facilities and do not form part of the LCR
eligible high-quality liquid assets. High-quality liquid assets cover both
Pillar 1 and Pillar 2 risks.
Liquidity value
30 June 31 December
2025 2024
NatWest Markets Plc £m £m
Cash and balances at central banks 9,847 10,965
High-quality government/MDB/PSE and GSE bonds (1) 9,451 8,962
Extremely high-quality covered bonds - -
LCR Level 1 eligible assets 19,298 19,927
LCR Level 2 eligible assets (2) 1,002 1,031
Primary liquidity (HQLA) (3) 20,300 20,958
Secondary liquidity (4) 28 30
Total liquidity value 20,328 20,988
LCR % %
Spot 197 195
Average 193 192
(1) Multilateral development bank abbreviated to MDB, public sector
entities abbreviated to PSE and government sponsored entities abbreviated to
GSE.
(2) Includes Level 2A and Level 2B.
(3) High-quality liquid assets abbreviated to HQLA.
(4) Comprises assets eligible for discounting at the Bank of England
and other central banks which do not form part of the LCR high-quality liquid
assets.
Risk and capital management
Capital, liquidity and funding risk continued
The table below shows the liquidity value of the liquidity portfolio by
currency.
GBP USD EUR Other Total
Total liquidity portfolio £m £m £m £m £m
30 June 2025 9,661 3,396 6,396 875 20,328
31 December 2024 11,667 3,353 4,996 972 20,988
Funding sources (reviewed)
The table below shows NWM Group's carrying values of the principal funding
sources based on contractual maturity.
30 June 2025 31 December 2024
Short-term Long-term Short-term Long-term
less than more than less than more than
1 year 1 year Total 1 year 1 year Total
£m £m £m £m £m £m
Bank deposits 4,145 406 4,551 4,056 509 4,565
of which: repos (amortised cost) 2,553 - 2,553 2,487 - 2,487
Customer deposits 7,858 28 7,886 4,784 56 4,840
of which: repos (amortised cost) 441 - 441 482 - 482
Trading liabilities (1)
Repos (2) 33,014 897 33,911 29,752 810 30,562
Derivative cash collateral received 11,452 - 11,452 12,307 - 12,307
Other bank and customer deposits 591 280 871 627 268 895
Debt securities in issue 9 242 251 20 237 257
45,066 1,419 46,485 42,706 1,315 44,021
Other financial liabilities
Customer deposits (designated fair value) 854 1,102 1,956 221 1,316 1,537
Debt securities in issue
Commercial paper and certificates of deposits (CDs) 6,998 298 7,296 7,228 377 7,605
Medium term notes (MTNs) 7,660 17,418 25,078 7,548 14,304 21,852
Subordinated liabilities - 268 268 - 269 269
15,512 19,086 34,598 14,997 16,266 31,263
Amounts due to holding company and fellow subsidiaries (3)
Internal MREL 1,621 2,968 4,589 929 3,429 4,358
Other bank and customer deposits 1,118 - 1,118 1,204 - 1,204
Subordinated liabilities - 1,043 1,043 - 1,115 1,115
2,739 4,011 6,750 2,133 4,544 6,677
Total funding 75,320 24,950 100,270 68,676 22,690 91,366
Of which: available in resolution (4) 4,279 4,813
(1) Funding sources excludes short positions of £12,215 million (31
December 2024 - £10,491 million) reflected as trading liabilities on the
balance sheet.
(2) Comprises central and other bank repos of £9,613 million (31
December 2024 - £7,174 million), other financial institution repos of
£20,826 million (31 December 2024 - £20,398 million) and other corporate
repos of £3,472 million (31 December 2024 - £2,990 million).
(3) Amounts due to holding company and fellow subsidiaries relating to
non-financial instruments of £114 million (31 December 2024 - £94 million)
have been excluded from the table.
(4) Eligible liabilities (as defined in the Banking Act 2009 as
amended from time to time) that meet the eligibility criteria set out in the
regulations, rules, policies, guidelines, or statements of the Bank of England
including the Statement of Policy published in December 2021 (updated June
2018).
Risk and capital management
Capital, liquidity and funding risk continued
Senior notes and subordinated liabilities - residual maturity profile by
instrument type (reviewed)
The table below shows NWM Group's debt securities in issue, subordinated
liabilities and internal resolution instruments by residual maturity.
Trading
liabilities Other financial liabilities Amounts due to holding company and
Debt securities Debt securities in issue fellow subsidiaries
in issue Commercial Subordinated Subordinated Total notes
MTNs paper and CDs MTNs liabilities Total Internal MREL liabilities in issue
30 June 2025 £m £m £m £m £m £m £m £m
Less than 1 year 9 6,998 7,660 - 14,658 1,621 - 16,288
1-3 years 36 298 11,034 - 11,332 1,726 - 13,094
3-5 years 67 - 5,700 - 5,700 1,242 934 7,943
More than 5 years 139 - 684 268 952 - 109 1,200
Total 251 7,296 25,078 268 32,642 4,589 1,043 38,525
31 December 2024
Less than 1 year 20 7,228 7,548 - 14,776 929 - 15,725
1-3 years 35 377 9,959 - 10,336 1,751 - 12,122
3-5 years 42 - 3,652 - 3,652 1,678 987 6,359
More than 5 years 160 - 693 269 962 - 128 1,250
Total 257 7,605 21,852 269 29,726 4,358 1,115 35,456
The table below shows the currency breakdown of total notes in issue.
GBP USD EUR Other Total
30 June 2025 £m £m £m £m £m
Commercial paper and CDs 1,741 1,603 3,952 - 7,296
MTNs 2,262 5,385 14,486 3,196 25,329
External subordinated liabilities 19 16 233 - 268
Internal MREL due to NatWest Group plc - 3,198 1,391 - 4,589
Subordinated liabilities due to NatWest Group plc - 1,043 - - 1,043
Total 4,022 11,245 20,062 3,196 38,525
31 December 2024 4,785 11,135 16,606 2,930 35,456
Risk and capital management
Credit risk - Trading activities (reviewed)
This section details the credit risk profile of NWM Group's trading
activities.
Securities financing transactions and collateral
The table below shows securities financing transactions in NWM Group. Balance
sheet captions include balances held at all classifications under IFRS.
Reverse repos Repos
Of which: Outside Of which: Outside
can be netting can be netting
Total offset arrangements Total offset arrangements
30 June 2025 £m £m £m £m £m £m
Gross 51,659 50,729 930 56,850 54,146 2,704
IFRS offset (19,945) (19,945) - (19,945) (19,945) -
Carrying value 31,714 30,784 930 36,905 34,201 2,704
Master netting arrangements (517) (517) - (517) (517) -
Securities collateral (29,442) (29,442) - (33,684) (33,684) -
Potential for offset not recognised under IFRS (29,959) (29,959) - (34,201) (34,201) -
Net 1,755 825 930 2,704 - 2,704
31 December 2024
Gross 45,774 45,734 40 48,705 48,002 703
IFRS offset (15,174) (15,174) - (15,174) (15,174) -
Carrying value 30,600 30,560 40 33,531 32,828 703
Master netting arrangements (1,549) (1,549) - (1,549) (1,549) -
Securities collateral (28,799) (28,799) - (31,279) (31,279) -
Potential for offset not recognised under IFRS (30,348) (30,348) - (32,828) (32,828) -
Net 252 212 40 703 - 703
Debt securities
The table below shows debt securities held at mandatory fair value through
profit or loss by issuer as well as ratings based on the lowest of Standard
& Poor's, Moody's and Fitch. Refer to Note 6 Trading assets and Trading
liabilities for details on short positions.
Central and local government Financial institutions
UK US Other Corporate Total
30 June 2025 £m £m £m £m £m £m
AAA - - 2,610 1,426 - 4,036
AA to AA+ - 6,832 562 393 2 7,789
A to AA- 3,961 - 2,618 955 95 7,629
BBB- to A- - - 916 411 549 1,876
Non-investment grade - - - 65 132 197
Total 3,961 6,832 6,706 3,250 778 21,527
31 December 2024
AAA - - 1,335 1,368 - 2,703
AA to AA+ - 3,734 74 569 2 4,379
A to AA- 2,077 - 1,266 381 519 4,243
BBB- to A- - - 831 562 885 2,278
Non-investment grade - - - 108 167 275
Total 2,077 3,734 3,506 2,988 1,573 13,878
Risk and capital management
Credit risk - Trading activities continued (reviewed)
Derivatives
The table below shows third-party derivatives by type of contract. The master
netting agreements and collateral shown do not result in a net presentation on
the balance sheet under IFRS.
30 June 2025 31 December 2024
Notional
GBP USD EUR Other Total Assets Liabilities Notional Assets Liabilities
£bn £bn £bn £bn £bn £m £m £bn £m £m
Gross exposure 74,037 67,797 79,894 74,421
IFRS offset and clearing house settlements (2,238) (2,238) (2,727) (2,727)
Carrying value 3,704 3,328 5,819 1,163 14,014 71,799 65,559 13,007 77,167 71,694
Of which:
Interest rate (1) 3,385 1,758 5,105 208 10,456 34,047 28,101 9,740 36,582 31,276
Exchange rate 318 1,566 708 955 3,547 37,668 37,301 3,254 40,474 40,183
Credit 1 4 6 - 11 84 157 13 111 235
Carrying value 3,704 3,328 5,819 1,163 14,014 71,799 65,559 13,007 77,167 71,694
Counterparty mark-to-market netting (56,720) (56,720) (61,531) (61,531)
Cash collateral (8,915) (4,645) (9,815) (5,797)
Securities collateral (3,028) (1,274) (3,396) (896)
Net exposure 3,136 2,920 2,425 3,470
Banks (2) 175 326 204 342
Other financial institutions (3) 1,834 1,254 1,424 1,443
Corporate (4) 1,069 1,317 764 1,653
Government (5) 58 23 33 32
Net exposure 3,136 2,920 2,425 3,470
UK 1,485 1,658 1,041 1,744
Europe 994 871 874 977
US 555 331 443 605
RoW 102 60 67 144
Net exposure 3,136 2,920 2,425 3,470
Asset quality of uncollateralised
derivative assets
AQ1-AQ4 2,492 2,028
AQ5-AQ8 641 394
AQ9-AQ10 3 3
Net exposure 3,136 2,425
(1) The notional amount of interest rate derivatives includes £7,177 billion (31
December 2024 - £6,733 billion) in respect of contracts cleared through
central clearing counterparties.
(2) Transactions with certain counterparties with which NWM Group has netting
arrangements but collateral is not posted on a daily basis; certain
transactions with specific terms that may not fall within netting and
collateral arrangements; derivative positions in certain jurisdictions, where
the collateral agreements are not deemed to be legally enforceable.
(3) Includes transactions with securitisation vehicles and funds where collateral
posting is contingent on NWM Group's external rating.
(4) Mainly large corporates with whom NWM Group may have netting arrangements in
place, but operational capability does not support collateral posting.
(5) Sovereigns and supranational entities with no collateral arrangements,
collateral arrangements that are not considered enforceable, or one-way
collateral agreements in their favour.
Risk and capital management
Credit risk - Economics (reviewed)
Economic loss drivers
Introduction
The portfolio segmentation and selection of economic loss drivers for IFRS 9
follows the approach used in stress testing. The stress models for each
portfolio segment (defined by product or asset class and where relevant,
industry sector and region) are based on a selected, small number of economic
variables that best explain the movements in portfolio loss rates. The process
to select economic loss drivers involves empirical analysis and expert
judgement.
The most significant economic loss drivers for the UK portfolios include UK
gross domestic product (GDP), world GDP, and the unemployment rate. Similar
metrics are used for other key country exposures in NWM Group.
Economic scenarios
At 30 June 2025, the range of anticipated future economic conditions was
defined by a set of four internally developed scenarios and their respective
probabilities. In addition to the base case, they comprised upside, downside
and extreme downside scenarios.
For 30 June 2025, the four scenarios were deemed appropriate in capturing the
uncertainty in economic forecasts and the non-linearity in outcomes under
different scenarios. These four scenarios were developed to provide sufficient
coverage to current risks faced by the economy and consider varying outcomes
across the labour market, inflation, interest rate, asset price and economic
growth, around which there remains pronounced levels of uncertainty.
Since 31 December 2024, the near-term economic growth outlook has weakened.
This was mainly due to the weaker economic performance in the second half of
2024 and the drag from international trade policy related uncertainty.
Inflation has risen, with underlying price pressure remaining firm,
particularly on services inflation. As a result, inflation is assumed to
remain a little higher than 3% through most of 2025, taking longer to fall
back to the target level of 2%. The labour market has continued to cool. The
unemployment rate peak is now assumed to be modestly higher than at 31
December 2024, but it is still expected to remain low. The Bank of England is
expected to continue cutting interest rates in a 'gradual and careful' manner
with an assumed terminal rate in the base case of 3.5%. The housing market
continues to show signs of resilience, with prices still expected to grow
modestly.
Economic loss drivers
High level narrative - potential developments, vulnerabilities and risks
Outperformance sustained - the economy continues to grow at a robust pace Upside
Growth
Steady growth - staying close to trend pace but with some near-term slowdown Base case
Stalling - lagged effect of higher inflation and cautious consumer amidst Downside
global trade policy and geopolitical uncertainty stalls the rebound
Extreme stress - extreme fall in GDP, with policy support to facilitate sharp Extreme downside
recovery
Sticky - strong growth and/or wage policies and/or interest rate cuts keep Upside
services inflation well above target
Inflation
Battle won - Beyond near-term volatility, downward drift in services inflation Base case
continues, ensuring 2% target is met on a sustained basis
Structural factors - sustained bouts of energy, food and goods price inflation Downside
on geopolitics/deglobalisation
Close to deflation - inflationary pressures diminish amidst pronounced Extreme downside
weakness in demand
Tighter, still - job growth rebounds strongly, pushing unemployment back down Upside
to 3.5%
Labour market
Cooling continues - gradual loosening prompts a gentle rise in unemployment Base case
(but remains low), job growth recovers
Job shedding - prolonged weakness in economy prompts redundancies, reduced Downside
hours, building slack
Depression - unemployment hits levels close to previous peaks amid severe Extreme downside
stress
Limited cuts - higher growth and inflation keeps the Monetary Policy Committee Upside
cautious
Rates
short-term
Steady - approximately one cut per quarter Base case
Mid-cycle quickening - sharp declines through 2025 to support recovery Downside
Sharp drop - drastic easing in policy to support a sharp deterioration in the Extreme downside
economy
Above consensus - 4% Upside
Rates long-term Middle - 3.5% Base case
Close to 2010s - 1-2%/2.5% Dow
nsi
de/
Ext
rem
e
dow
nsi
de
Risk and capital management
Credit risk - Economics continued (reviewed)
Economic loss drivers
Main macroeconomic variables
The main macroeconomic variables for each of the four scenarios used for
expected credit loss (ECL) modelling are set out in the table below.
30 June 2025 31 December 2024
Extreme Weighted Extreme Weighted
Upside Base case Downside downside average Upside Base case Downside downside average
Five-year summary % % % % % % % % % %
GDP 2.1 1.3 0.6 (0.1) 1.2 2.0 1.3 0.5 (0.2) 1.1
Unemployment rate 3.8 4.6 5.4 7.1 4.9 3.6 4.3 5.0 6.7 4.6
House price index 5.7 3.4 0.5 (4.3) 2.5 5.8 3.5 0.8 (4.3) 2.7
Commercial real estate price 6.1 2.0 (0.3) (4.8) 1.8 5.4 1.2 (1.0) (5.7) 1.1
Consumer price index 2.4 2.2 3.7 1.7 2.5 2.4 2.2 3.5 1.6 2.4
Bank of England base rate 4.1 3.6 2.5 1.2 3.2 4.4 4.0 3.0 1.6 3.6
Stock price index 5.2 3.8 2.6 0.7 3.5 6.3 5.0 3.4 1.1 4.5
World GDP 3.7 3.0 2.3 1.4 2.8 3.8 3.2 2.5 1.6 3.0
Probability weight 21.7 45.0 20.7 12.6 23.2 45.0 19.1 12.7
(1) The five-year summary runs from 2025-2029 for 30 June 2025 and
from 2024-28 for 31 December 2024.
(2) The table shows compound annual growth rate (CAGR) for GDP,
average levels for the unemployment rate and Bank of England base rate and Q4
to Q4 CAGR for other parameters.
Probability weightings of scenarios
NWM Group's quantitative approach to IFRS 9 multiple economic scenarios
involves selecting a suitable set of discrete scenarios to characterise the
distribution of risks in the economic outlook and assigning appropriate
probability weights. This quantitative approach is used for 30 June 2025.
The approach involves comparing GDP paths for NWM Group's scenarios against a
set of 1,000 model runs, following which, a percentile in the distribution is
established that most closely corresponded to the scenario. The probability
weight for base case is set first based on judgement, while probability
weights for the alternate scenarios are assigned based on these percentiles
scores.
The weights were broadly comparable to those used at 31 December 2024 but with
slightly more downside skew. The assigned probability weights were judged to
be aligned with the subjective assessment of balance of the risks in the
economy as global trade policy uncertainty increased, and geopolitical risks
remained elevated. US trade policy remains a key area of uncertainty for the
economy. NWM Group is comfortable that the adjustments made to the base case
view reflect much of the adverse economic impacts from tariffs, while the
downside scenarios give good coverage to the potential for more significant
economic damage, including higher inflation and downturns in business
investment and consumer spending. Given the balance of risks that the economy
is exposed to, NWM Group judges it appropriate that downside-biased scenarios
have higher combined probability weights than the upside-biased scenario. It
presents good coverage to the range of outcomes assumed in the scenarios,
including the potential for a robust recovery on the upside and exceptionally
challenging outcomes on the downside. A 21.7% weighting was applied to the
upside scenario, a 45.0% weighting applied to the base case scenario, a 20.7%
weighting applied to the downside scenario and a 12.6% weighting applied to
the extreme downside scenario.
Worst points
30 June 2025 31 December 2024
Extreme Weighted Extreme Weighted
Downside downside average Downside downside average
% Quarter % Quarter % % Quarter % Quarter %
GDP - Q2 2027 (4.8) Q2 2026 - - Q1 2024 (4.1) Q4 2025 -
Unemployment rate - peak 5.8 Q2 2027 8.5 Q3 2027 5.1 5.6 Q4 2026 8.5 Q1 2027 4.9
House price index (5.0) Q4 2027 (28.0) Q1 2028 - (1.9) Q2 2027 (25.6) Q3 2027 -
Commercial real estate price (8.4) Q4 2026 (33.5) Q1 2027 - (10.5) Q2 2026 (35.0) Q3 2026 (1.8)
Consumer price index
- highest four quarter change 6.1 Q3 2026 3.2 Q2 2025 3.3 6.1 Q1 2026 3.5 Q1 2024 3.5
Bank of England base rate
- extreme level 2.0 Q1 2025 0.1 Q1 2025 2.9 2.0 Q1 2024 0.1 Q1 2024 2.9
Stock price index (6.6) Q2 2026 (32.1) Q2 2026 - (0.2) Q4 2025 (27.4) Q4 2025 -
(1) The figures show falls relative to the starting period for GDP, house price
index, commercial real estate price and stock price index. For unemployment
rate, it shows highest value through the scenario horizon. For consumer price
index, it shows highest annual percentage change. For Bank of England base
rate, it shows highest or lowest value through the horizon. The calculations
are performed over five years, with a starting point of Q4 2024 for 30 June
2025 scenarios and Q4 2023 for 31 December 2024 scenarios.
Risk and capital management
Credit risk - Economics continued (reviewed)
Governance and post model adjustments
The IFRS 9 PD, EAD and LGD models are subject to NWM Group's model risk policy
that stipulates periodic model monitoring, periodic re-validation and defines
approval procedures and authorities according to model materiality. Various
post model adjustments were applied where management judged they were
necessary to ensure an adequate level of overall ECL provision. All post model
adjustments were subject to review, challenge and approval through model or
provisioning committees.
Post model adjustments will remain a key focus area of NWM Group's ongoing ECL
adequacy assessment process. A holistic framework has been established
including reviewing a range of economic data, external benchmark information
and portfolio performance trends with a particular focus on segments of the
portfolio that are likely to be more susceptible to high inflation, high
interest rates and supply chain disruption.
For H1 2025, the economic uncertainty post model adjustment decreased to £7
million (31 December 2024 - £10 million) with £6 million in Stage 1 and £1
million in Stage 2 (31 December 2024 - £8 million (Stage 1) and £2 million
(Stage 2)).
Measurement uncertainty and ECL sensitivity analysis
The recognition and measurement of ECL is complex and involves the use of
significant judgement and estimation, particularly in times of economic
volatility and uncertainty. This includes the formulation and incorporation of
multiple forward-looking economic conditions into ECL to meet the measurement
objective of IFRS 9. The ECL provision is sensitive to the model inputs and
economic assumptions underlying the estimate.
The impact arising from the base case, upside, downside and extreme downside
scenarios was simulated. In the simulations, NWM Group has assumed that the
economic macro variables associated with these scenarios replace the existing
base case economic assumptions, giving them a 100% probability weighting and
therefore serving as a single economic scenario.
These scenarios were applied to all modelled portfolios in the analysis below,
with the simulation impacting both PDs and LGDs. Post model adjustments
included in the ECL estimates that were modelled were sensitised in line with
the modelled ECL movements, but those that were judgemental in nature,
primarily those for deferred model calibrations and economic uncertainty, were
not (refer to the Governance and post model adjustments section) on the basis
these would be re-evaluated by management through ECL governance for any new
economic scenario outlook and not be subject to an automated calculation. As
expected, the scenarios create differing impacts on ECL by portfolio and the
impacts are deemed reasonable. In this simulation, it is assumed that existing
modelled relationships between key economic variables and loss drivers hold,
but in practice other factors would also have an impact, for example,
potential customer behaviour changes and policy changes by lenders that might
impact on the wider availability of credit.
The focus of the simulations is on ECL provisioning requirements on performing
exposures in Stage 1 and Stage 2. The simulations are run on a stand-alone
basis and are independent of each other; the potential ECL impacts reflect the
simulated impact at 30 June 2025. Scenario impacts on significant increase in
credit risk (SICR) should be considered when evaluating the ECL movements of
Stage 1 and Stage 2. In all scenarios the total exposure was the same but
exposure by stage varied in each scenario.
Stage 3 provisions are not subject to the same level of measurement
uncertainty - default is an observed event as at the balance sheet date. Stage
3 provisions therefore were not considered in this analysis.
NWM Group's core criterion to identify a SICR is founded on PD deterioration.
Under the simulations, PDs change and result in exposures moving between Stage
1 and Stage 2 contributing to the ECL impact.
Risk and capital management
Credit risk - Measurement uncertainty and ECL sensitivity analysis continued
(reviewed)
Moderate Moderate Extreme
Base upside downside downside
30 June 2025 Actual scenario scenario scenario scenario
Stage 1 modelled loans (£m) 20,744 20,744 20,744 20,720 19,301
Stage 1 modelled ECL (£m) 25 22 20 26 47
Stage 1 coverage (%) 0.12% 0.11% 0.10% 0.13% 0.24%
Stage 2 modelled loans (£m) 269 269 269 293 1,712
Stage 2 modelled ECL (£m) 4 3 3 3 14
Stage 2 coverage (%) 1.49% 1.12% 1.12% 1.02% 0.82%
Stage 1 and Stage 2 modelled loans (£m) 21,013 21,013 21,013 21,013 21,013
Stage 1 and Stage 2 modelled ECL (£m) 29 25 23 29 61
Stage 1 and Stage 2 coverage (%) 0.14% 0.12% 0.11% 0.14% 0.29%
Variance - (lower)/higher to actual total Stage 1 and Stage 2 ECL (£m) - (4) (6) - 32
Reconciliation to Stage 1 and Stage 2 flow exposure (£m)
Modelled loans 21,013 21,013 21,013 21,013 21,013
Other asset classes 31,032 31,032 31,032 31,032 31,032
(1) Variations in future undrawn exposure values across the scenarios are
modelled. However, the exposure position reported is that used to calculate
modelled ECL as at 30 June 2025 and therefore does not include variation in
future undrawn exposure values.
(2) Reflects ECL for all modelled exposure in scope for IFRS 9. The analysis
excludes non-modelled portfolios.
(3) All simulations are run on a stand-alone basis and are independent of each
other, with the potential ECL impact reflecting the simulated impact as at 30
June 2025. The simulations change the composition of Stage 1 and Stage 2
exposure but total exposure was unchanged under each scenario as the loan
population is static.
(4) Refer to the Economic loss drivers section for details of economic scenarios.
(5) Refer to the NatWest Markets Plc 2024 Annual Report and Accounts for 31
December 2024 comparatives.
Measurement uncertainty and ECL adequacy
- If the economics were as negative as observed in the extreme downside
(i.e. 100% probability weighting), total Stage 1 and Stage 2 ECL was simulated
to increase. In this scenario, Stage 2 exposure increased significantly and
was the key driver of the simulated ECL rise. The movement in Stage 2 balances
in the other simulations was less significant.
- There was a significant increase in ECL under the extreme downside
scenario.
- Given the continued economic uncertainty, NWM Group utilised a
framework of quantitative and qualitative measures to support the levels of
ECL coverage. This included economic data, credit performance insights and
problem debt trends. This was particularly important for consideration of post
model adjustments.
- As the effects of these economic risks evolve, there is a risk of
further credit deterioration. However, the income statement effect of this
should be mitigated by the forward-looking provisions retained on the balance
sheet at 30 June 2025.
- There are a number of key factors that could drive further downside to
impairments, through deteriorating economic and credit metrics and increased
stage migration as credit risk increases for more customers. Such factors
which could impact the IFRS 9 models, include an adverse deterioration in
unemployment, GDP and stock price index.
Risk and capital management
Credit risk - Banking activities (reviewed)
This section details the credit risk profile of NWM Group's banking
activities.
Portfolio summary
The table below shows gross loans and ECL, by stage, within the scope of the
IFRS 9 ECL framework.
30 June 31 December
2025 2024
£m £m
Loans - amortised cost and FVOCI
Stage 1 20,987 18,759
Stage 2 260 352
Stage 3 50 52
Of which: individual 43 45
Of which: collective 7 7
Inter-group (1) 323 260
Total 21,620 19,423
ECL provisions
Stage 1 25 25
Stage 2 4 5
Stage 3 16 17
Of which: individual 9 10
Of which: collective 7 7
Inter-group (1) - -
Total 45 47
ECL provisions coverage (2)
Stage 1 (%) 0.12 0.13
Stage 2 (%) 1.54 1.42
Stage 3 (%) 32.00 32.69
Total 0.21 0.25
Half year ended
30 June 30 June
2025 2024
£m £m
Impairment releases
ECL release
Stage 1 (1) (3)
Stage 2 - -
Stage 3 (2) (4)
Of which: individual (2) (4)
Of which: collective - -
Third party (3) (7)
Total (3) (7)
Amounts written-off - 2
(1) NWM Group's intercompany assets were classified in Stage 1.
The ECL for these loans was £0.2 million (31 December 2024 - £0.2 million).
(2) ECL provisions coverage is calculated as ECL provisions
divided by loans - amortised cost and FVOCI. It is calculated on loans and
total ECL provisions, including ECL for other (non-loan) assets and unutilised
exposure. Some segments with a high proportion of debt securities or
unutilised exposure may result in a not meaningful (nm) coverage ratio.
(3) The table shows gross loans only and excludes amounts that are
outside the scope of the ECL framework. For further details, refer to
Financial instruments within the scope of the IFRS 9 ECL framework on page 51
of the NatWest Markets Plc 2024 Annual Report and Accounts. Other financial
assets within the scope of the IFRS 9 ECL framework were cash and balances at
central banks totalling £18.6 billion (31 December 2024 - £16.2 billion) and
debt securities of £16.9 billion (31 December 2024 - £17.8 billion).
(4) The stage allocation of the ECL charge was aligned to the
stage transition approach that underpins the analysis in the Flow statement
section.
Risk and capital management
Credit risk - Banking activities continued (reviewed)
Sector analysis - portfolio summary
The table below shows ECL by stage, for the Non-Personal portfolio including
the three largest borrowing sector clusters included in corporate and other.
Off-balance sheet
Loans - amortised cost and FVOCI Loan Contingent ECL provisions
Stage 1 Stage 2 Stage 3 Total commitments liabilities Stage 1 Stage 2 Stage 3 Total
30 June 2025 £m £m £m £m £m £m £m £m £m £m
Financial institutions (1) 20,338 211 - 20,549 7,752 637 22 2 - 24
Sovereign 276 - - 276 - - 1 - - 1
Corporate & Other 373 49 50 472 6,457 21 2 2 16 20
Of which:
Technology, Media
& Telecommunications 66 21 3 90 843 3 1 1 3 5
Mobility & Logistics 37 15 - 52 1,508 - - - - -
Manufacturing 43 3 - 46 775 6 1 - - 1
Total 20,987 260 50 21,297 14,209 658 25 4 16 45
31 December 2024
Financial institutions (1) 17,627 276 - 17,903 7,829 689 20 3 - 23
Sovereign 661 - - 661 - - 1 - - 1
Corporate & Other 471 76 52 599 6,272 24 4 2 17 23
Of which:
Technology, Media
& Telecommunications 59 22 2 83 889 5 1 1 4 6
Mobility & Logistics 55 26 - 81 1,464 - - - - -
Manufacturing 45 1 - 46 498 6 1 - - 1
Total 18,759 352 52 19,163 14,101 713 25 5 17 47
(1) Includes transactions, such as securitisations, where the
underlying risk may be in other sectors.
Risk and capital management
Credit risk - Banking activities continued (reviewed)
Flow statement
The flow statement that follows shows the main ECL and related income
statement movements. It also shows the changes in ECL as well as the changes
in related financial assets used in determining ECL. Due to differences in
scope, exposures may differ from those reported in other tables, principally
in relation to exposures in Stage 1 and Stage 2. These differences do not have
a material ECL effect. Other points to note:
- Financial assets include treasury liquidity portfolios, comprising
balances at central banks and debt securities, as well as loans. Both modelled
and non-modelled portfolios are included.
- Stage transfers (for example, exposures moving from Stage 1 into Stage
2) are a key feature of the ECL movements, with the net re-measurement cost of
transitioning to a worse stage being a primary driver of income statement
charges. Similarly, there is an ECL benefit for accounts improving stage.
- Changes in risk parameters shows the reassessment of the ECL within a
given stage, including any ECL overlays and residual income statement gains or
losses at the point of write-off or accounting write-down.
- Other (P&L only items) includes any subsequent changes in the
value of written-down assets along with other direct write-off items such as
direct recovery costs. Other (P&L only items) affects the income statement
but does not affect balance sheet ECL movements.
- Amounts written-off represent the gross asset written-down against
accounts with ECL, including the net asset write-down for any debt sale
activity.
Stage 1 Stage 2 Stage 3 Total
Financial Financial Financial Financial
assets ECL assets ECL assets ECL assets ECL
NWM Group £m £m £m £m £m £m £m £m
At 1 January 2025 52,474 25 349 5 53 17 52,876 47
Currency translation and other adjustments (1,139) - (8) - 1 1 (1,146) 1
Inter-Group transfers - - - - - - - -
Transfers from Stage 1 to Stage 2 (341) - 341 - - - - -
Transfers from Stage 2 to Stage 1 409 1 (409) (1) - - - -
Transfers from Stage 3 - - - - - - - -
Net re-measurement of ECL on stage transfer - - - - - - - -
Changes in risk parameters - (5) - - - (2) - (7)
Other changes in net exposure 331 4 38 - (4) - 365 4
Other (P&L only items) - - - - - - - -
Income statement releases (1) - (2) (3)
Amounts written-off - - - - - - - -
Unwinding of discount - - - -
At 30 June 2025 51,734 25 311 4 50 16 52,095 45
Net carrying amount 51,709 307 34 52,050
At 1 January 2024 49,168 24 687 8 24 24 49,879 56
2024 movements (521) (1) (290) (2) (3) (7) (814) (10)
At 30 June 2024 48,647 23 397 6 21 17 49,065 46
Net carrying amount 48,624 391 4 49,019
Condensed consolidated income statement
for the half year ended 30 June 2025 (unaudited)
Half year ended
30 June 30 June
2025 2024
£m £m
Interest receivable 1,288 1,357
Interest payable (1,044) (1,120)
Net interest income 244 237
Fees and commissions receivable 229 254
Fees and commissions payable (102) (111)
Income from trading activities 391 229
Other operating income - 41
Non-interest income 518 413
Total income 762 650
Staff costs (265) (241)
Premises and equipment (36) (36)
Other administrative expenses (360) (311)
Depreciation and amortisation (6) (4)
Operating expenses (667) (592)
Profit before impairment releases 95 58
Impairment releases 3 7
Operating profit before tax 98 65
Tax (charge)/credit (9) 18
Profit for the period 89 83
Attributable to:
Ordinary shareholders 26 40
Paid-in equity holders 63 34
Non-controlling interests - 9
89 83
Condensed consolidated statement of comprehensive income
for the half year ended 30 June 2025 (unaudited)
Half year ended
30 June 30 June
2025 2024
£m £m
Profit for the period 89 83
Items that do not qualify for reclassification
Remeasurement of retirement benefit schemes (3) (3)
Changes in fair value of financial liabilities designated at fair value (1) (26)
through profit or loss (FVTPL)
Fair value through other comprehensive income (FVOCI) financial assets 13 3
Tax 1 18
10 (8)
Items that do qualify for reclassification
FVOCI financial assets - 6
Cash flow hedges (1) 101 (73)
Currency translation (63) (50)
Tax (31) 20
7 (97)
Other comprehensive income/(losses) after tax 17 (105)
Total comprehensive income/(losses) for the period 106 (22)
Attributable to:
Ordinary shareholders 43 (65)
Paid-in equity holders 63 34
Non-controlling interests - 9
106 (22)
(1) Refer to footnote 1 of the consolidated statement of changes in
equity.
Condensed consolidated balance sheet
as at 30 June 2025 (unaudited)
30 June 31 December
2025 2024
£m £m
Assets
Cash and balances at central banks 18,579 16,229
Trading assets 56,603 48,883
Derivatives 72,524 78,105
Settlement balances 8,120 2,043
Loans to banks - amortised cost 1,352 1,171
Loans to customers - amortised cost 20,589 17,921
Amounts due from holding company and fellow subsidiaries 413 343
Other financial assets 16,982 17,850
Other assets 588 621
Total assets 195,750 183,166
Liabilities
Bank deposits 4,551 4,565
Customer deposits 7,886 4,840
Amounts due to holding company and fellow subsidiaries 6,864 6,771
Settlement balances 9,275 1,729
Trading liabilities 58,700 54,512
Derivatives 65,802 72,036
Other financial liabilities 34,598 31,263
Other liabilities 507 521
Total liabilities 188,183 176,237
Owners' equity 7,567 6,929
Total equity 7,567 6,929
Total liabilities and equity 195,750 183,166
Condensed consolidated statement of changes in equity
for the half year ended 30 June 2025 (unaudited)
Half year ended
30 June 30 June
2025 2024
£m £m
Called up share capital - at beginning and end of period 400 400
Share premium account - at beginning and end of period 1,946 1,946
Paid-in equity - at beginning of period 1,496 904
Securities issued during the year 600 -
At end of period 2,096 904
Merger reserve - at beginning of period (11) (14)
Amortisation 1 1
At end of period (10) (13)
FVOCI reserve - at beginning of period 25 13
Unrealised gains 15 9
Realised gains (3) (2)
Tax (1) 1
At end of period 36 21
Cash flow hedging reserve - at beginning of period (177) (164)
Amount recognised in equity (1) (19) (212)
Amount transferred from equity to earnings (2) 120 139
Tax (30) 21
At end of period (106) (216)
Foreign exchange reserve - at beginning of period 87 100
Retranslation of net assets (94) (66)
Foreign currency gains on hedges of net assets 31 19
Recycled to profit or loss on disposal of businesses - (3)
At end of period 24 50
Retained earnings - at beginning of period 3,163 3,195
Profit attributable to ordinary shareholders and other equity owners 89 74
Paid-in equity dividends paid (63) (34)
Remeasurement of retirement benefit schemes
- gross (3) (3)
- tax 1 14
Realised gains in period on FVOCI equity shares 1 2
Changes in fair value of financial liabilities designated at FVTPL due to
changes in credit risk
- gross (1) (26)
- tax - 2
Share-based payments (5) (5)
Amortisation of merger reserve (1) (1)
At end of period 3,181 3,218
Owners' equity at end of period 7,567 6,310
Non-controlling interests - at beginning of period - (2)
Profit attributable to non-controlling interests - 9
At end of period - 7
Total equity at end of period 7,567 6,317
Attributable to:
Ordinary shareholders 5,471 5,406
Paid-in equity holders 2,096 904
Non-controlling interests - 7
7,567 6,317
(1) The change in the cash flow hedging reserve is driven by realised
accrued interest transferred to the income statement and a decrease in swap
rates in the year, where the portfolio of swaps are net receive fixed.
(2) The amount transferred from equity to the income statement is
mostly recorded within net interest income mainly within loans to banks and
customers - amortised cost and balances at central banks.
Condensed consolidated cash flow statement
for the half year ended 30 June 2025 (unaudited)
Half year ended
30 June 30 June
2025 2024
£m £m
Cash flows from operating activities
Operating profit before tax 98 65
Adjustments for non-cash and other items (721) 50
Net cash flows from trading activities (623) 115
Changes in operating assets and liabilities (169) 5,379
Net cash flows from operating activities before tax (792) 5,494
Income taxes received/(paid) 2 (101)
Net cash flows from operating activities (790) 5,393
Net cash flows from investing activities 1,382 (665)
Net cash flows from financing activities 843 399
Effects of exchange rate changes on cash and cash equivalents 130 (346)
Net increase in cash and cash equivalents 1,565 4,781
Cash and cash equivalents at beginning of period 24,536 24,943
Cash and cash equivalents at end of period 26,101 29,724
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 and in accordance with IAS 34 'Interim Financial Reporting',
as adopted by the UK and as issued by the International Accounting Standards
Board (IASB), and the Disclosure Guidance and Transparency Rules sourcebook of
the UK's Financial Conduct Authority.
2. Non-interest income
Half year ended
30 June 30 June
2025 2024
Analysis of net fees and commissions £m £m
Fees and commissions receivable
- Lending and financing 51 59
- Brokerage 27 22
- Underwriting fees 88 93
- Other 63 80
Total 229 254
Fees and commissions payable (102) (111)
Net fees and commissions 127 143
Income from trading activities
Foreign exchange 175 89
Interest rate 151 225
Credit 62 (78)
Changes in fair value of own debt and derivative liabilities attributable to
own credit risk
- debt securities in issue and derivative liabilities 3 (7)
391 229
Other operating income
Changes in fair value of financial assets and liabilities designated at (83) (41)
FVTPL (1)
Other income (2) 83 82
- 41
Total 518 413
(1) Includes related derivatives.
(2) Other income includes a profit share agreement with fellow
NatWest Group subsidiaries that rewards NWM Group on an arm's length basis for
its contribution to the performance of the NatWest Group Commercial &
Institutional business segment.
Notes
3. Operating expenses
Half year ended
30 June 30 June
2025 2024
£m £m
Salaries and other staff costs 146 148
Temporary and contract costs 11 5
Social security costs 27 23
Bonus awards 74 60
Pension costs 7 5
- defined benefit schemes (5) (7)
- defined contribution schemes 12 12
Staff costs 265 241
Premises and equipment 36 36
Depreciation and amortisation 6 4
Other administrative expenses (1,2) 360 311
Administrative expenses 402 351
Total 667 592
(1) Includes £285 million (30 June 2024 - £253 million) of recharges
from other NatWest Group entities, mainly NWB Plc which provides the majority
of shared services (including technology) and operational processes.
(2) Includes litigation and other regulatory costs. Further details
are provided in Note 8.
4. Tax
The actual tax credit differs from the expected tax credit computed by
applying the standard UK corporation tax rate of 25% (2024 - 25%), as analysed
below:
Half year ended
30 June 30 June
2025 2024
£m £m
Profit before tax 98 65
Expected tax charge (25) (16)
Losses and temporary differences in period where no deferred tax asset - (1)
recognised
Foreign profits taxed at other rates (2) -
Items not allowed for tax:
- losses on disposals and write-downs - 2
- UK bank levy (4) (3)
- regulatory and legal actions (16) -
Non-taxable items:
- RPI-related uplift on index-linked gilts 9 18
- other non-taxable items - 9
Unrecognised losses brought forward and utilised 18 9
Banking surcharge (1) 4
Tax on paid-in equity dividends 10 10
Adjustments in respect of prior years 2 (14)
Actual tax (charge)/credit (9) 18
At 30 June 2025, NWM Group has recognised a deferred tax asset of £148
million (31 December 2024 - £172 million) and a deferred tax liability of
£37 million (31 December 2024 - £37 million). These amounts include deferred
tax assets recognised in respect of trading losses of £85 million (31
December 2024 - £83 million). NWM Group has considered the carrying value of
these assets as at 30 June 2025 and concluded that they are recoverable.
Notes
5. Financial instruments - classification
The following tables analyse financial assets and liabilities in accordance
with the categories of financial instruments in IFRS 9.
Amortised Other
MFVTPL DFV FVOCI cost assets Total
£m £m £m £m £m £m
Assets
Cash and balances at central banks 18,579 18,579
Trading assets 56,603 56,603
Derivatives (1) 72,524 72,524
Settlement balances 8,120 8,120
Loans to banks - amortised cost (2) 1,352 1,352
Loans to customers - amortised cost 20,589 20,589
Amounts due from holding company and fellow subsidiaries 17 - - 345 51 413
Other financial assets 48 5 5,115 11,814 16,982
Other assets 588 588
30 June 2025 129,192 5 5,115 60,799 639 195,750
Cash and balances at central banks 16,229 16,229
Trading assets 48,883 48,883
Derivatives (1) 78,105 78,105
Settlement balances 2,043 2,043
Loans to banks - amortised cost (2) 1,171 1,171
Loans to customers - amortised cost 17,921 17,921
Amounts due from holding company and fellow subsidiaries 29 - - 260 54 343
Other financial assets 49 5 4,611 13,185 17,850
Other assets 621 621
31 December 2024 127,066 5 4,611 50,809 675 183,166
Held-for- Amortised Other
trading DFV cost liabilities Total
£m £m £m £m £m
Liabilities
Bank deposits (3) 4,551 4,551
Customer deposits 7,886 7,886
Amounts due to holding company and fellow subsidiaries 530 - 6,229 105 6,864
Settlement balances 9,275 9,275
Trading liabilities 58,700 58,700
Derivatives (1) 65,802 65,802
Other financial liabilities - 4,134 30,464 34,598
Other liabilities (4) 39 468 507
30 June 2025 125,032 4,134 58,444 573 188,183
Bank deposits (3) 4,565 4,565
Customer deposits 4,840 4,840
Amounts due to holding company and fellow subsidiaries 613 - 6,075 83 6,771
Settlement balances 1,729 1,729
Trading liabilities 54,512 54,512
Derivatives (1) 72,036 72,036
Other financial liabilities - 3,507 27,756 31,263
Other liabilities (4) 44 477 521
31 December 2024 127,161 3,507 45,009 560 176,237
(1) Includes net hedging derivative assets of £318 million (31 December 2024 -
£110 million) and net hedging derivative liabilities of £464 million (31
December 2024 - £474 million).
(2) Includes items in the course of collection from other banks of £758 million
(31 December 2024 - £44 million).
(3) Includes items in the course of transmission to other banks of £246 million
(31 December 2024 - £102 million).
(4) Includes lease liabilities of £36 million (31 December 2024 - £41 million),
held at amortised cost.
Notes
5. Financial instruments - valuation
Disclosures relating to the control environment, valuation techniques and
related aspects pertaining to financial instruments measured at fair value are
included in NatWest Markets Plc's 2024 Annual Report and Accounts. Valuation,
sensitivity methodologies and inputs at 30 June 2025 are consistent with those
described in Note 10 to the financial statements in the NatWest Markets Plc
2024 Annual Report and Accounts.
Fair value hierarchy
The table below shows the assets and liabilities held by NWM Group split by
fair value hierarchy level. Level 1 are considered the most liquid
instruments, and level 3 the most illiquid, valued using expert judgment and
hence carry the most significant price uncertainty.
30 June 2025 31 December 2024
Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total
£m £m £m £m £m £m £m £m
Assets
Trading assets
Loans - 34,833 243 35,076 - 34,727 278 35,005
Securities 16,289 5,238 - 21,527 8,772 5,106 - 13,878
Derivatives
Interest rate - 34,201 455 34,656 - 37,019 483 37,502
Foreign exchange - 37,635 149 37,784 - 40,382 110 40,492
Other - 41 43 84 - 64 47 111
Amounts due from holding company
and fellow subsidiaries - 17 - 17 - 29 - 29
Other financial assets
Loans - 1 93 94 - 1 93 94
Securities 3,291 1,678 105 5,074 3,163 1,313 95 4,571
Total financial assets held at fair value 19,580 113,644 1,088 134,312 11,935 118,641 1,106 131,682
As % of total fair value assets 14% 85% 1% 9% 90% 1%
Liabilities
Amounts due to holding company
and fellow subsidiaries - 530 - 530 - 613 - 613
Trading liabilities
Deposits - 46,234 - 46,234 - 43,764 - 43,764
Debt securities in issue - 251 - 251 - 257 - 257
Short positions 9,749 2,465 1 12,215 8,766 1,724 1 10,491
Derivatives
Interest rate - 28,108 208 28,316 - 31,223 287 31,510
Foreign exchange - 37,253 76 37,329 - 40,225 66 40,291
Other - 94 63 157 - 115 120 235
Other financial liabilities
Deposits - 1,930 25 1,955 - 1,537 - 1,537
Debt securities in issue - 1,942 3 1,945 - 1,733 3 1,736
Subordinated liabilities - 234 - 234 - 234 - 234
Total financial liabilities held at fair value 9,749 119,041 376 129,166 8,766 121,425 477 130,668
As % of total fair value liabilities 8% 92% 0% 7% 93% 0%
(1) Level 1 - Instruments valued using unadjusted quoted prices in active and
liquid markets, for identical financial instruments. Examples include
government bonds, listed equity shares and certain exchange-traded
derivatives.
Level 2 - Instruments valued using valuation techniques that have observable
inputs. Observable inputs are those that are readily available with limited
adjustments required. Examples include most government agency securities,
investment-grade corporate bonds, products - including CLOs, most bank loans,
repos and reverse repos, state and municipal obligations, most notes issued,
certain money market securities, loan commitments and most OTC derivatives.
Level 3 - Instruments valued using a valuation technique where at least one
input which could have a significant effect on the instrument's valuation, is
not based on observable market data. Examples include non-derivative
instruments which trade infrequently, certain syndicated and commercial loans,
private equity, and derivatives with unobservable model inputs.
(2) Transfers between levels are deemed to have occurred at the beginning of the
quarter in which the instruments were transferred.
(3) For an analysis of debt securities held at mandatorily fair value through
profit or loss by issuer as well as ratings and derivatives, by type and
contract, refer to Risk and capital management - Credit risk.
Notes
5. Financial instruments - valuation continued
Valuation adjustments
When valuing financial instruments in the trading book, adjustments are made
to mid-market valuations to cover bid-offer spread, funding and credit risk.
These adjustments are presented in the table below. For further information
refer to the descriptions of valuation adjustments within 'Financial
instruments - valuation' on page 113 of the NatWest Markets Plc 2024 Annual
Report and Accounts.
30 June 31 December
2025 2024
£m £m
Funding valuation adjustments (FVA) (10) (3)
Credit valuation adjustments (CVA) 187 190
Bid-offer 49 49
Product and deal specific 138 156
Total 364 392
- The decrease in FVA was driven by exposure changes primarily due to
new trading activity and longer-dated interest rates increasing. The decrease
in product and deal specific was driven by the amortisation of deferred trade
inception profits partially offset by new trading activity.
Level 3 sensitivities
The table below shows the favourable and unfavourable range of fair value of
the level 3 assets and liabilities.
30 June 2025 31 December 2024
Level 3 Favourable Unfavourable Level 3 Favourable Unfavourable
£m £m £m £m £m £m
Assets
Trading assets
Loans 243 - - 278 - -
Derivatives
Interest rate 455 20 (20) 483 20 (20)
Foreign exchange 149 10 (10) 110 - -
Other 43 - - 47 - -
Other financial assets
Loans 93 - - 93 - -
Securities 105 10 (10) 95 10 (10)
Total 1,088 40 (40) 1,106 30 (30)
Liabilities
Trading liabilities
Short positions 1 - - 1 - -
Derivatives
Interest rate 208 10 (10) 287 10 (10)
Foreign exchange 76 - - 66 - -
Other 63 - - 120 10 (10)
Other financial liabilities
Debt securities in issue 3 - - 3 - -
Deposits 25 - - - - -
Total 376 10 (10) 477 20 (20)
Alternative assumptions
Reasonably plausible alternative assumptions of unobservable inputs are
determined based on a specified target level of certainty of 90%. Alternative
assumptions are determined with reference to all available evidence including
consideration of the following: quality of independent pricing information
considering consistency between different sources, variation over time,
perceived tradability or otherwise of available quotes; consensus service
dispersion ranges; volume of trading activity and market bias (e.g. one-way
inventory); day 1 profit or loss arising on new trades; number and nature of
market participants; market conditions; modelling consistency in the market;
size and nature of risk; length of holding of position; and market
intelligence.
Notes
5. Financial instruments - valuation continued
Movement in level 3 assets and liabilities
The following table shows the movement in level 3 assets and liabilities.
Other Other Other Other
Derivatives trading financial Total Derivatives trading financial Total
assets assets (2) assets (3) assets liabilities liabilities (2) liabilities liabilities
£m £m £m £m £m £m £m £m
At 1 January 2025 640 278 188 1,106 473 1 3 477
Amounts recorded in the income
statement (1) (65) 2 (1) (64) (97) - 1 (96)
Amount recorded in the statement of
comprehensive income - - 11 11 - - - -
Level 3 transfers in 40 - - 40 7 - 24 31
Level 3 transfers out (6) - - (6) (11) - - (11)
Purchases/originations 70 89 3 162 47 - - 47
Settlements/other decreases (2) (31) - (33) (34) - - (34)
Sales (31) (97) (2) (130) (40) - - (40)
Foreign exchange and other adjustments 1 2 (1) 2 2 - - 2
At 30 June 2025 647 243 198 1,088 347 1 28 376
Amounts recorded in the income statement
in respect of balance held at period end:
- unrealised 57 1 (4) 54 (16) - - (16)
At 1 January 2024 843 223 205 1,271 700 3 3 706
Amounts recorded in the income
statement (1) (78) 2 (3) (79) (28) - - (28)
Amount recorded in the statement of
comprehensive income - - (1) (1) - - - -
Level 3 transfers in 7 - - 7 1 - - 1
Level 3 transfers out (2) (15) - (17) (2) (1) - (3)
Purchases/originations 82 25 2 109 67 1 - 68
Settlements/other decreases (38) (7) - (45) (29) - - (29)
Sales (40) - (2) (42) (38) (1) - (39)
Foreign exchange and other adjustments - 1 (1) - (2) - - (2)
At 30 June 2024 774 229 200 1,203 669 2 3 674
Amounts recorded in the income statement
in respect of balance held at period end:
- unrealised 108 - (2) 106 123 - - 123
(1) Net gains on trading assets and liabilities of £34 million (30 June 2024 -
£48 million net losses) were recorded in income from trading activities. Net
losses on other instruments of £2 million (30 June 2024 - £3 million net
losses) were recorded in other operating income and interest income as
appropriate.
(2) Other trading assets and other trading liabilities comprise assets and
liabilities held at fair value in trading portfolios.
(3) Other financial assets comprise fair value through other comprehensive income,
designated as at fair value through profit or loss and other fair value
through profit or loss.
Notes
5. Financial instruments - valuation continued
Fair value of financial instruments measured at amortised cost on the balance
sheet
The following table shows the carrying value and fair value of financial
instruments carried at amortised cost on the balance sheet.
Items where fair
Carrying Fair Fair value hierarchy level value approximates
value value Level 2 Level 3 carrying value
30 June 2025 £bn £bn £bn £bn £bn
Financial assets
Cash and balances at central banks 18.6 18.6 - - 18.6
Settlement balances 8.1 8.1 - - 8.1
Loans to banks 1.4 1.4 - - 1.4
Loans to customers 20.6 20.6 3.6 17.0 -
Amounts due from holding company
and fellow subsidiaries 0.3 0.3 - 0.2 0.1
Other financial assets - securities 11.8 11.9 5.5 6.4 -
31 December 2024
Financial assets
Cash and balances at central banks 16.2 16.2 - - 16.2
Settlement balances 2.0 2.0 - - 2.0
Loans to banks 1.2 1.2 0.5 - 0.7
Loans to customers 17.9 17.9 3.1 14.8 -
Amounts due from holding company
and fellow subsidiaries 0.3 0.3 - 0.2 0.1
Other financial assets - securities 13.2 13.3 5.6 7.7 -
30 June 2025
Financial liabilities
Bank deposits 4.6 4.6 2.6 1.7 0.3
Customer deposits 7.9 7.9 0.4 7.4 0.1
Amounts due to holding company
and fellow subsidiaries 6.2 6.2 5.8 0.4 -
Settlement balances 9.3 9.3 - - 9.3
Other financial liabilities - debt securities in issue 30.5 30.5 26.2 4.3 -
31 December 2024
Financial liabilities
Bank deposits 4.6 4.6 2.5 2.0 0.1
Customer deposits 4.8 4.8 0.5 4.2 0.1
Amounts due to holding company
and fellow subsidiaries 6.1 6.1 5.5 0.6 -
Settlement balances 1.7 1.7 - - 1.7
Other financial liabilities - debt securities in issue 27.7 27.7 22.8 4.9 -
The assumptions and methodologies underlying the calculation of fair values of
financial instruments at the balance sheet date are as follows:
Short-term financial instruments
For certain short-term financial instruments: cash and balances at central
banks, items in the course of collection from other banks, settlement
balances, items in the course of transmission to other banks, and customer
demand deposits, carrying value is deemed a reasonable approximation of fair
value.
Loans to banks and customers
In estimating the fair value of net loans to customers and banks measured at
amortised cost, NWM Group's loans are segregated into appropriate portfolios
reflecting the characteristics of the constituent loans. Two principal methods
are used to estimate fair value; contractual cash flows and expected cash
flows.
Debt securities and subordinated liabilities
Most debt securities are valued using quoted prices in active markets or from
quoted prices of similar financial instruments in active markets. For the
remaining population, fair values are determined using market standard
valuation techniques, such as discounted cash flows.
Bank and customer deposits
Fair values of deposits are estimated using discounted cash flow valuation
techniques.
Notes
6. Trading assets and liabilities
Trading assets and liabilities comprise assets and liabilities held at fair
value in trading portfolios.
30 June 31 December
2025 2024
£m £m
Assets
Loans
Reverse repos 28,165 27,127
Collateral given 6,232 7,333
Other loans 679 545
Total loans 35,076 35,005
Securities
Central and local government
- UK 3,961 2,077
- US 6,832 3,734
- Other 6,706 3,506
Financial institutions and Corporate 4,028 4,561
Total securities 21,527 13,878
Total 56,603 48,883
Liabilities
Deposits
Repos 33,911 30,562
Collateral received 11,452 12,307
Other deposits 871 895
Total deposits 46,234 43,764
Debt securities in issue 251 257
Short positions
Central and local government
- UK 2,346 2,680
- US 1,946 1,677
- Other 6,825 4,755
Financial institutions and Corporate 1,098 1,379
Total short positions 12,215 10,491
Total 58,700 54,512
Notes
7. Loan impairment provisions
Loan exposure and impairment metrics
The table below summarises loans and related credit impairment metrics within
the scope of ECL framework.
30 June 31 December
2025 2024
£m £m
Loans - amortised cost and FVOCI
Stage 1 20,987 18,759
Stage 2 260 352
Stage 3 50 52
Of which: individual 43 45
Of which: collective 7 7
Inter-group (1) 323 260
Total 21,620 19,423
ECL provisions
Stage 1 25 25
Stage 2 4 5
Stage 3 16 17
Of which: individual 9 10
Of which: collective 7 7
Inter-group - -
Total 45 47
ECL provisions coverage (2)
Stage 1 (%) 0.12 0.13
Stage 2 (%) 1.54 1.42
Stage 3 (%) 32.00 32.69
Inter-group (%) - 0.05
Total 0.21 0.25
Half year ended
30 June 30 June
2025 2024
£m £m
Impairment releases
ECL release
Stage 1 (1) (3)
Stage 2 - -
Stage 3 (2) (4)
Of which: individual (2) (4)
Of which: collective - -
Third party (3) (7)
Inter-group - -
Total (3) (7)
Amounts written-off - 2
(1) NWM Group's intercompany assets were classified in Stage 1. The ECL for these
loans was £0.2 million (31 December 2024 - £0.2 million).
(2) ECL provisions coverage is calculated as ECL provisions divided by loans -
amortised cost and FVOCI. It is calculated on third party loans and total ECL
provisions.
(3) The table shows gross loans only and excludes amounts that are outside the
scope of the ECL framework. For further details, refer to Financial
instruments within the scope of the IFRS 9 ECL framework on page 51 of the
NatWest Markets Plc 2024 Annual Report and Accounts. Other financial assets
within the scope of the IFRS 9 ECL framework were cash and balances at central
banks totalling £18.6 billion (31 December 2024 - £16.2 billion) and debt
securities of £16.9 billion (31 December 2024 - £17.8 billion).
Notes
8. Provisions for liabilities and charges
Litigation
and other
regulatory Other (1) Total
£m £m £m
At 1 January 2025 108 38 146
Currency translation and other movements (9) - (9)
Charge to income statement 7 4 11
Release to income statement - - -
Provisions utilised (6) (4) (10)
At 30 June 2025 100 38 138
(1) Materially comprises provisions relating to restructuring costs
and Bank of England levy.
Provisions are liabilities of uncertain timing or amount and are recognised
when there is a present obligation as a result of a past event, the outflow of
economic benefit is probable, and the outflow can be estimated reliably. Any
difference between the final outcome and the amounts provided will affect the
reported results in the period when the matter is resolved.
9. Contingent liabilities and commitments
The amounts shown in the table below are intended only to provide an
indication of the volume of business outstanding at 30 June 2025. Although the
NWM Group is exposed to credit risk in the event of a customer's failure to
meet its obligations, the amounts shown do not, and are not intended to,
provide any indication of NWM Group's expectation of future losses.
30 June 31 December
2025 2024
£m £m
Contingent liabilities and commitments
Guarantees 643 696
Other contingent liabilities 15 17
Standby facilities, credit lines and other commitments 14,206 14,097
Total 14,864 14,810
Commitments and contingent obligations are subject to NWM Group's normal
credit approval processes.
Risk-sharing arrangements
NWM Plc and NWM N.V. have limited risk-sharing arrangements in place to
facilitate the smooth provision of services to NatWest Markets' customers. The
arrangements, which NWM Plc recognises as financial guarantees within Amounts
due to subsidiaries, include:
- The provision of a funded guarantee of up to £0.7 billion by NWM Plc
to NWM N.V. that limits NWM N.V.'s exposure to large individual customer
credits. Funding is provided by NWM Plc deposits placed with NWM N.V. of not
less than the guaranteed amount. At 30 June 2025 the deposits amounted to
£0.1 billion and the guaranteed fees in the period were £0.7 million.
- The provision of unfunded guarantees by NWM Plc in respect of NWM
N.V.'s legacy portfolio. At 30 June 2025 the exposure at default covered by
the guarantees was approximately £0.2 billion (of which none was cash
collateralised). Fees of £0.2 million in relation to the guarantees were
recognised in the period.
Indemnity deed
In April 2019 NWM Plc and NWB Plc entered into a cross indemnity agreement for
losses incurred within the entities in relation to business transferred to or
from the ring-fenced bank under the NatWest Group's structural
re-organisation. Under the agreement, NWM Plc is indemnified by NWB Plc
against losses relating to NWB Plc transferring businesses and ring-fenced
bank obligations and NWB Plc is indemnified by NWM Plc against losses relating
to NWM Plc transferring businesses and non-ring-fenced bank obligations with
effect from the relevant transfer date.
Notes
10. Litigation and regulatory matters
NWM Plc and its subsidiary and associated undertakings (NWM Group) are party
to various legal proceedings and are involved in, or subject to, various
regulatory matters, including as the subject of investigations and other
regulatory and governmental action (Matters) in the United Kingdom (UK), the
United States (US), the European Union (EU) and other jurisdictions.
NWM Group recognises a provision for a liability in relation to these Matters
when it is probable that an outflow of economic benefits will be required to
settle an obligation resulting from past events, and a reliable estimate can
be made of the amount of the obligation.
In many of the Matters, it is not possible to determine whether any loss is
probable, or to estimate reliably the amount of any loss, either as a direct
consequence of the relevant proceedings and regulatory matters or as a result
of adverse impacts or restrictions on NWM Group's reputation, businesses and
operations. Numerous legal and factual issues may need to be resolved,
including through potentially lengthy discovery and document production
exercises and determination of important factual matters, and by addressing
novel or unsettled legal questions relevant to the proceedings in question,
before the probability of a liability, if any, arising can reasonably be
estimated in respect of any Matter. NWM Group cannot predict if, how, or when
such claims will be resolved or what the eventual settlement, damages, fine,
penalty or other relief, if any, may be, particularly for Matters that are at
an early stage in their development or where claimants seek substantial or
indeterminate damages.
There are situations where NWM Group may pursue an approach that in some
instances leads to a settlement agreement. This may occur in order to avoid
the expense, management distraction or reputational implications of continuing
to contest liability, or in order to take account of the risks inherent in
defending or contesting Matters, even for those for which NWM Group believes
it has credible defences and should prevail on the merits. The uncertainties
inherent in all Matters affect the amount and timing of any potential economic
outflows for both Matters with respect to which provisions have been
established and other contingent liabilities in respect of any such Matter.
It is not practicable to provide an aggregate estimate of potential liability
for our Matters as a class of contingent liabilities.
The future economic outflow in respect of any Matter may ultimately prove to
be substantially greater than, or less than, the aggregate provision, if any,
that NWM Group has recognised in respect of such Matter. Where a reliable
estimate of the economic outflow cannot be reasonably made, no provision has
been recognised. NWM Group expects that in future periods, additional
provisions and economic outflows relating to Matters that may or may not be
currently known by NWM Group will be necessary, in amounts that are expected
to be substantial in some instances. Refer to Note 8 for information on
material provisions.
Matters which are, or could be, material, either individually or in aggregate,
having regard to NWM Group, considered as a whole, in which NWM Group is
currently involved are set out below. We have provided information on the
procedural history of certain Matters, where we believe appropriate, to aid
the understanding of the Matter.
For a discussion of certain risks associated with NWM Group's litigation and
regulatory matters (including the Matters), refer to the Risk Factor relating
to legal, regulatory and governmental actions and investigations set out on
pages 172 to 173 of the NatWest Markets Plc 2024 Annual Report and Accounts.
Litigation
London Interbank Offered Rate (LIBOR) and other rates litigation
NWM Plc and certain other members of NatWest Group, including NatWest Group
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 the NWM Group
defendants 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. The defendants in the co-ordinated
proceeding have filed a summary judgment motion on the issue of liability, and
briefing on that motion concluded in January 2025. The court is currently
considering the motion.
The non-class claims filed in the SDNY include claims that the Federal Deposit
Insurance Corporation (FDIC) is asserting on behalf of certain failed US
banks. In July 2017, the FDIC, on behalf of 39 of those failed US banks,
commenced substantially similar claims against NatWest Group companies and
others in the High Court of Justice of England and Wales. The action alleges
collusion with regard to the setting of USD LIBOR and that the defendants
breached UK and European competition law, as well as asserting common law
claims of fraud under US law. The defendant banks consented to a request by
the FDIC for discontinuance of the claim in respect of 20 failed US banks,
leaving 19 failed US banks as claimants.
In June 2025, NatWest Group companies reached an agreement to settle the
FDIC's claims, both those pending in the SDNY and those pending in the High
Court of Justice in England and Wales. The settlement amount has been paid and
was covered in full by an existing provision.
Notes
10. Litigation and regulatory matters continued
In addition to the USD LIBOR cases described above, there is a class action
relating to derivatives allegedly tied to JPY LIBOR and Euroyen TIBOR, which
was dismissed by the SDNY in relation to NWM Plc and other NatWest Group
companies in September 2021. That dismissal is now the subject of an appeal to
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. The plaintiffs' appeals in those two cases
remain pending.
In August 2020, a complaint was filed in the United States District Court for
the Northern District of California by several United States retail borrowers
against the USD ICE LIBOR panel banks and their affiliates (including NatWest
Group plc, NWM Plc, NWMSI and NWB Plc), alleging (i) that the very process of
setting USD ICE LIBOR amounts to illegal price-fixing; and (ii) that banks in
the United States have illegally agreed to use LIBOR as a component of price
in variable retail loans. In September 2022, the district court dismissed the
complaint. In December 2024, the United States Court of Appeals for the Ninth
Circuit affirmed the district court's decision. In June 2025, the United
States Supreme Court denied the claimants' petition for review.
NWM Plc is also named as a defendant in a motion to certify a class action
relating to LIBOR in the Tel Aviv District Court in Israel. NWM Plc filed a
motion for cancellation of service outside the jurisdiction, which was granted
in July 2020. The claimants appealed that decision and in November 2020 the
appeal was refused and the claim dismissed by the Appellate Court. In January
2025, Israel's Supreme Court dismissed the appeals in respect of the dismissal
of the substantive case against banks that had a presence in Israel.
Subject to any limitation argument, the Supreme Court noted that further legal
clarification of the matter could be sought, so there is potential for future
LIBOR claims in Israel.
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 2019, a cartel class action was filed in the Federal Court of Australia
against NWM Plc and four other banks on behalf of persons who bought or sold
currency through FX spots or forwards between 1 January 2008 and 15 October
2013 with a total transaction value exceeding AUD 0.5 million. The claimant
has alleged that the banks, including NWM Plc, contravened Australian
competition law by sharing information, coordinating conduct, widening spreads
and manipulating FX rates for certain currency pairs during this period.
NatWest Group plc and NWMSI have been named in the action as 'other cartel
participants', but are not respondents.
In May 2025, NWM Plc executed an agreement to settle the claim in the Federal
Court of Australia, subject to court approval of that settlement. The
settlement amount is covered in full by an existing provision.
In July and December 2019, two separate applications seeking opt-out
collective proceedings orders were filed in the UK Competition Appeal Tribunal
(CAT) against NatWest Group plc, NWM Plc and other banks. Both applications
were brought on behalf of persons who, between 18 December 2007 and 31 January
2013, entered into a relevant FX spot or outright forward transaction in the
European Economic Area with a relevant financial institution or on an
electronic communications network. In March 2022, the CAT declined to certify
as collective proceedings either of the applications, which was appealed by
the applicants and was the subject of an application for judicial review.
In its amended judgment in November 2023, the Court of Appeal allowed the
appeal and decided that the claims should proceed on an opt-out basis.
Separately, the court determined which of the two competing applicants can
proceed as class representative, and dismissed the application for judicial
review of the CAT's decision. The other applicant has discontinued its claim
and withdrawn from the proceedings. The banks sought permission to appeal the
Court of Appeal decision directly to the UK Supreme Court, which was granted
in April 2024.
The appeal was heard in April 2025 and judgment is awaited.
Two motions to certify FX-related class actions were filed in the Tel Aviv
District Court in Israel in September and October 2018, and were subsequently
consolidated into one motion. The consolidated motion to certify, which names
The Royal Bank of Scotland plc (now NWM Plc) and several other banks as
defendants, was served on NWM Plc in May 2020.
The applicants sought the court's permission to amend their motions to certify
the class actions. NWM Plc filed a motion challenging the permission granted
by the court for the applicants to serve the consolidated motion outside the
Israeli jurisdiction. That NWM Plc motion remains pending. In February 2024,
NWM Plc executed an agreement to settle the claim, subject to court approval.
The settlement amount is covered in full by an existing provision.
Notes
10. Litigation and regulatory matters continued
Foreign exchange litigation continued
In December 2021, a summons was served in the Netherlands against NatWest
Group plc, NWM Plc and NWM N.V. by Stichting FX Claims on behalf of a number
of parties, seeking declarations from the court concerning liability for
anti-competitive FX market conduct described in decisions of the European
Commission (EC) of 16 May 2019, along with unspecified damages. The claimant
amended its claim to also refer to a 2 December 2021 decision by the EC, which
described anti-competitive FX market conduct. NatWest Group plc, NWM Plc and
other defendants contested the jurisdiction of the Dutch court. In March 2023,
the district court in Amsterdam accepted that it has jurisdiction to hear
claims against NWM N.V. but refused jurisdiction to hear any claims against
the other defendant banks (including NatWest Group plc and NWM Plc) brought on
behalf of the parties represented by the claimant that are domiciled outside
of the Netherlands. The claimant is appealing that decision. The defendant
banks have brought cross-appeals which seek a ruling that the Dutch court has
no jurisdiction to hear any claims against the defendant banks domiciled
outside of the Netherlands, irrespective of whether the claim has been brought
on behalf of a party represented by the claimant that is domiciled within or
outside of the Netherlands. The Amsterdam Court of Appeal has stayed these
appeal proceedings until the Court of Justice of the European Union has
answered preliminary questions that have been referred to it in another
matter.
In September 2023, a second summons was served by Stichting FX Claims on
NatWest Group plc, NWM Plc and NWM N.V., on behalf of a new group of parties.
The claimant seeks declarations from the district court in Amsterdam
concerning liability for anti-competitive FX market conduct described in the
above referenced decisions of the EC of 16 May 2019 and 2 December 2021, along
with unspecified damages. NatWest Group plc, NWM Plc and other defendants are
contesting the Dutch court's jurisdiction. The district court has stayed the
proceedings pending judgment in the above-mentioned appeals.
In January 2025, a third summons was served by Stichting FX Claims on NatWest
Group plc, NWM Plc and NWM N.V., on behalf of another new group of parties.
The claimant seeks similar declarations from the district court in Amsterdam
to those being sought in the above-mentioned claims, along with unspecified
damages.
NatWest Group plc, NWM Plc and other defendants are contesting the Dutch
court's jurisdiction. The district court has stayed the proceedings pending
judgment in the above-mentioned appeals.
Certain other foreign exchange transaction related claims have been or may be
threatened. NatWest Group cannot predict whether all or any of these claims
will be pursued.
Swaps antitrust litigation
NWM Plc and other members of NatWest Group, including NatWest Group plc, as
well as a number of other interest rate swap dealers, are defendants in
several cases pending in the SDNY alleging violations of the US antitrust laws
in the market for interest rate swaps. Three swap execution facilities
(TeraExchange, Javelin, and trueEx) allege that they would have successfully
established exchange-like trading of interest rate swaps if the defendants had
not unlawfully conspired to prevent that from happening through boycotts and
other means. Discovery is complete though expert discovery is ongoing. In
March 2024, NatWest Group companies reached an agreement to settle a
consolidated class action complaint on behalf of persons who entered into
interest rate swaps with the defendants, which was predicated on similar
allegations. The settlement amount was previously paid into escrow pending
final court approval of the settlement and was covered in full by an existing
provision. On 17 July 2025, the SDNY granted final approval of the class
action settlement.
In June 2021, a class action antitrust complaint was filed against a number of
credit default swap dealers in New Mexico federal court on behalf of persons
who, from 2005 onwards, settled credit default swaps in the United States by
reference to the ISDA credit default swap auction protocol. The complaint
alleges that the defendants conspired to manipulate that benchmark through
various means in violation of the antitrust laws and the Commodity Exchange
Act. The defendants filed a motion to dismiss the complaint and, in June 2023,
such motion was denied as regards to NWMSI and other financial institutions,
but granted as regards to NWM Plc on the ground that the court lacks
jurisdiction over that entity.
In January 2024, the SDNY issued an order barring the plaintiffs in the New
Mexico case from pursuing claims based on conduct occurring before 30 June
2014 on the ground that such claims were extinguished by a 2015 settlement
agreement that resolved a prior class action relating to credit default swaps.
In May 2025, the SDNY's decision was affirmed by US Court of Appeals.
The case in the New Mexico federal court (which was stayed pending the appeal
of the SDNY's decision) will now re-commence but as limited by the decision of
the US Court of Appeals.
Notes
10. Litigation and regulatory matters continued
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. 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. The defendants are now seeking dismissal by a different district
court judge.
Spoofing litigation
In December 2021, three substantially similar class actions complaints were
filed in federal court in the United States against NWM Plc and NWMSI alleging
Commodity Exchange Act and common law unjust enrichment claims arising from
manipulative trading known as spoofing. The complaints refer to NWM Plc's
December 2021 spoofing-related guilty plea (described below under "US
investigations relating to fixed-income securities") and purport to assert
claims on behalf of those who transacted in US Treasury securities and futures
and options on US Treasury securities between 2008 and 2018. In July 2022, the
defendants filed a motion to dismiss these claims, which have been
consolidated into one matter in the United States District Court for the
Northern District of Illinois.
Madoff
NWM N.V. was named as a defendant in two actions filed by the trustee for the
bankrupt estates of Bernard L. Madoff and Bernard L. Madoff Investment
Securities LLC, in bankruptcy court in New York, which together seek to
clawback more than US$300 million (plus pre-judgment interest) that NWM N.V.
allegedly received from certain Madoff feeder funds and certain swap
counterparties.
The claims were previously dismissed, but as a result of an August 2021
decision by the US Court of Appeals, they are now proceeding in the discovery
phase in the bankruptcy court, where they have been consolidated into one
action.
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. The plaintiffs have now filed a motion in the
district court to re-open the case to assert aiding and abetting claims that
they previously did not assert, which the defendants are opposing. 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.
1MDB litigation
A Malaysian court claim was served in Switzerland in November 2022 by 1MDB, a
sovereign wealth fund, in which Coutts & Co Ltd was named, along with six
others, as a defendant in respect of losses allegedly incurred by 1MDB. It is
claimed that Coutts & Co Ltd is liable as a constructive trustee for
having dishonestly assisted the directors of 1MDB in the breach of their
fiduciary duties by failing (amongst other alleged claims) to undertake due
diligence in relation to a customer of Coutts & Co Ltd, through which
funds totalling c.US$1 billion were received and paid out between 2009 and
2011. 1MDB seeks the return of that amount plus interest. Coutts & Co Ltd
filed an application in January 2023 challenging the validity of service and
the Malaysian court's jurisdiction to hear the claim, and a hearing took place
in February 2024. In March 2024, the court granted that application. 1MDB has
appealed that decision and a prior decision by the court not to allow them to
discontinue their claim. Both appeals are scheduled to be heard in November
2025.
Coutts & Co Ltd (a subsidiary of RBS Netherlands Holdings B.V., which in
turn is a subsidiary of NWM Plc) is a company registered in Switzerland and is
in wind-down following the announced sale of its business assets in 2015.
Notes
10. Litigation and regulatory matters continued
Regulatory matters
NWM Group's financial condition can be affected by the actions of various
governmental and regulatory authorities in the UK, the US, the EU and
elsewhere. NWM Group companies have engaged, and will continue to engage, in
discussions with relevant governmental and regulatory authorities, including
in the UK, the US, the EU and elsewhere, on an ongoing and regular basis, and
in response to informal and formal inquiries or investigations, regarding
operational, systems and control evaluations and issues including those
related to compliance with applicable laws and regulations, including consumer
protection, investment advice, business conduct, competition/anti-trust, VAT
recovery, anti-bribery, anti-money laundering and sanctions regimes.
Any matters discussed or identified during such discussions and inquiries may
result in, among other things, further inquiry or investigation, other action
being taken by governmental and regulatory authorities, increased costs being
incurred by NWM Group, remediation of systems and controls, public or private
censure, restriction of NWM Group's business activities and/or fines. Any of
the events or circumstances mentioned in this paragraph or below could have a
material adverse effect on NWM Group, its business, authorisations and
licences, reputation, results of operations or the price of securities issued
by it, or lead to material additional provisions being taken.
NWM Group is co-operating fully with the matters described below.
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, have 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. This agreement is subject to documentation
and court approval. If approved, NWM's obligations under the plea agreement
and probation would be extended until December 2026. Should DOJ, USAO CT,
and NWM be unable to agree on the documentation or the court declines to
approve the amendment, the parties would need to agree on, and/or revert to
the court with an alternative plan, as applicable.
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
172 to 173 of the NatWest Markets Plc 2024 Annual Report and Accounts.
11. Related party transactions
UK Government
In May 2025, the UK Government through His Majesty's Treasury (HMT) sold its
remaining shareholding in NatWest Group plc. Under UK listing rules the UK
Government and UK Government-controlled bodies remained related parties until
12 July 2025, 12 months after the UK Government shareholding in NatWest Group
plc fell below 20%.
NWM Group enters into transactions with many of these bodies. Transactions
include the payment of: taxes - principally UK corporation tax and value added
tax; national insurance contributions; local authority rates; regulatory fees
and levies; together with banking transactions such as loans and deposits
undertaken in the normal course of banker-customer relationships.
Bank of England facilities
NWM Group may participate in a number of schemes operated by the Bank of
England in the normal course of business.
Other related parties
(a) In their roles as providers of finance, NWM Group companies provide
development and other types of capital support to businesses.
(b) To further strategic partnerships, NWM Group may seek to invest in third
parties or allow third parties to hold a minority interest in a subsidiary of
NWM Group. We disclose as related parties for associates and joint ventures
and where equity interest are over 10%. Ongoing business transactions with
these entities are on normal commercial terms.
(c) NWM Group is recharged from other NatWest Group entities, mainly NWB Plc
which provides the majority of shared services (including technology) and
operational processes.
(d) In accordance with IAS 24, transactions or balances between NWM Group
entities that have been eliminated on consolidation are not reported.
Full details of NWM Group's related party transactions for the year ended 31
December 2024 are included in the NatWest Markets Plc 2024 Annual Report and
Accounts.
Notes
11. Related party transactions continued
Amounts due to/from holding company and fellow subsidiaries
NWM Group's financial assets and liabilities include amounts due from/to the
holding company and fellow subsidiaries as below:
30 June 2025 31 December 2024
Holding Fellow Holding Fellow
company subsidiaries Total company subsidiaries Total
£m £m £m £m £m £m
Assets
Trading assets - 17 17 - 29 29
Settlement balances - 23 23 - - -
Loans to banks - amortised cost - 306 306 - 242 242
Loans to customers - amortised cost 16 - 16 18 - 18
Other assets - 51 51 - 54 54
Amounts due from holding company and
fellow subsidiaries 16 397 413 18 325 343
Derivatives (1) 402 323 725 616 322 938
Liabilities
Bank deposits - amortised cost - 544 544 - 548 548
Customer deposits - amortised cost - 44 44 - 43 43
Trading liabilities 379 151 530 561 52 613
Other financial liabilities - subordinated liabilities 1,043 - 1,043 1,115 - 1,115
MREL instruments issued to NatWest Group plc 4,589 - 4,589 4,358 - 4,358
Other liabilities - 114 114 - 94 94
Amounts due to holding company and
fellow subsidiaries 6,011 853 6,864 6,034 737 6,771
Derivatives (1) 64 179 243 62 280 342
(1) Intercompany derivatives are included within derivatives
classification on the balance sheet.
12. Post balance sheet events
On 2 July 2025, NatWest Group plc gave notice to holders of the $1,150,000,000
8.000% Perpetual Subordinated Contingent Convertible Additional Tier 1 Capital
Notes of the upcoming redemption of the Notes on 10 August 2025. The
announcement and redemption of the Notes, which were downstreamed to NWM Plc,
is expected to increase NWM Plc's CET1 by approximately £59 million and
result in the charge of approximately £75 million historic FX translation to
the income statement from reserves.
Other than as disclosed in the accounts, there have been no other significant
events between 30 June 2025 and the date of approval of this announcement
which would require a change to or additional disclosure in the announcement.
13. Date of approval
This announcement was approved by the Board of Directors on 24 July 2025.
Independent review report to NatWest Markets Plc
Conclusion
We have been engaged by NatWest Markets Plc ("the Group") to review the
condensed consolidated financial statements in the interim results report for
the six months ended 30 June 2025 which comprises the condensed consolidated
income statement, the condensed consolidated statement of comprehensive
income, the condensed consolidated balance sheet, the condensed consolidated
statement of changes in equity, the condensed consolidated cash flow
statement, and related Notes 1 to 13 and the Risk and capital management
disclosures for those identified as within the scope of our review (together
"the condensed consolidated financial statements"). We have read the other
information contained in the interim results report and considered whether it
contains any apparent misstatements or material inconsistencies with the
information in the condensed consolidated financial statements.
Based on our review, nothing has come to our attention that causes us to
believe that the condensed consolidated financial statements in the interim
results report for the six months ended 30 June 2025 are not prepared, in all
material respects, in accordance with International Accounting Standard 34
"Interim Financial Reporting" as adopted by the United Kingdom (UK) and as
issued by the International Accounting Standards Board (IASB), and the
Disclosure Guidance and Transparency Rules of the UK's Financial Conduct
Authority.
Basis for Conclusion
We conducted our review in accordance with International Standard on Review
Engagements 2410 (UK) "Review of Interim Financial Information Performed by
the Independent Auditor of the Entity" (ISRE) issued by the Financial
Reporting Council. A review of interim financial information consists of
making enquiries, primarily of persons responsible for financial and
accounting matters, and applying analytical and other review procedures. A
review is substantially less in scope than an audit conducted in accordance
with International Standards on Auditing (UK) and consequently does not enable
us to obtain assurance that we would become aware of all significant matters
that might be identified in an audit. Accordingly, we do not express an audit
opinion.
As disclosed in note 1, the annual financial statements of the Group are
prepared in accordance with UK adopted International Accounting Standards and
International Financial Reporting Standards as issued by the International
Accounting Standards Board. The condensed consolidated financial statements
included in this interim results report have been prepared in accordance with
International Accounting Standard 34 as adopted by the UK and as issued by the
IASB, and the Disclosure Guidance and Transparency Rules of the UK's Financial
Conduct Authority.
Conclusions Relating to Going Concern
Based on our review procedures, which are less extensive than those performed
in an audit as described in the Basis for Conclusion section of this report,
nothing has come to our attention to suggest that management have
inappropriately adopted the going concern basis of accounting or that
management have identified material uncertainties relating to going concern
that are not appropriately disclosed.
This conclusion is based on the review procedures performed in accordance with
this ISRE, however future events or conditions may cause the entity to cease
to continue as a going concern.
Responsibilities of the directors
The directors are responsible for preparing the interim results report in
accordance with the Disclosure Guidance and Transparency Rules of the UK's
Financial Conduct Authority.
In preparing the interim results report, the directors are responsible for
assessing the Group's ability to continue as a going concern, disclosing, as
applicable, matters related to going concern and using the going concern basis
of accounting unless the directors either intend to liquidate the Group or to
cease operations, or have no realistic alternative but to do so.
Auditor's Responsibilities for the review of the financial information
In reviewing the interim results report, we are responsible for expressing to
the Group a conclusion on the condensed consolidated financial statements in
the interim results report. Our conclusion, including our Conclusions Relating
to Going Concern, are based on procedures that are less extensive than audit
procedures, as described in the Basis for Conclusion paragraph of this report.
Use of our report
This report is made solely to the Group in accordance with guidance contained
in International Standard on Review Engagements 2410 (UK) "Review of Interim
Financial Information Performed by the Independent Auditor of the Entity"
issued by the Financial Reporting Council. To the fullest extent permitted by
law, we do not accept or assume responsibility to anyone other than the Group,
for our work, for this report, or for the conclusions we have formed.
Ernst & Young LLP
London, United Kingdom
24 July 2025
NatWest Markets Plc Summary Risk Factors
Summary of Principal risks and uncertainties
Set out below is a summary of the principal risks and uncertainties for the
remaining six months of the financial year which could adversely affect NWM
Group. This summary should not be regarded as a complete and comprehensive
statement of all potential risks and uncertainties; a fuller description of
these and other risk factors is included on pages 159 to 176 of the NatWest
Markets Plc 2024 Annual Report and Accounts and pages 15 to 42 of the NWM Plc
Registration Document dated 17 March 2025 (as supplemented and amended from
time to time). Any of the risks identified may have a material adverse effect
on NWM Group's business, operations, financial condition or prospects.
Economic and political risk
- NWM Group, its customers and its counterparties face continued
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.
- Fluctuations in currency exchange rates may adversely affect NWM
Group's results and financial condition.
- Changes in interest rates will continue to affect NWM Group's business
and results.
Business change and execution risk
- NWM Group has been in a period of, and may continue to be subject to,
significant structural and other change.
- The transfer of NatWest Group's Western European corporate portfolio
involves certain risks.
Financial resilience risk
- NWM Group may not achieve its ambitions or targets, meet its guidance,
generate returns, or implement its strategy effectively.
- NWM Plc and/or its regulated subsidiaries may not meet the prudential
regulatory requirements for regulatory capital.
- NWM Group is reliant on access to the capital markets to meet its
funding requirements, both directly through wholesale markets, and indirectly
through its parent (NatWest Group plc) for the subscription to its internal
capital and MREL. The inability to do so may adversely affect NWM Group.
- NWM Group may not meet the prudential regulatory requirements for
liquidity and funding or may not be able to adequately access sources of
liquidity and funding, which could trigger the execution of certain management
actions or recovery options.
- NWM Plc and/or its regulated subsidiaries may not manage their
capital, liquidity or funding effectively which could trigger the execution of
certain management actions or recovery options.
- Any reduction in the credit rating and/or outlooks assigned to NatWest
Group plc, any of its subsidiaries (including NWM Plc or NWM Group
subsidiaries) or any of their respective debt securities could adversely
affect the availability of funding for NWM Group, reduce NWM Group's liquidity
and funding position and increase the cost of funding.
- NWM Group operates in markets that are highly competitive, with
competitive pressures and technology disruption.
- NWM Group may be adversely affected if NatWest Group fails to meet the
requirements of regulatory stress tests.
- NWM Group has significant exposure to counterparty and borrower risk
including credit losses, which may have an adverse effect on NWM Group.
- NWM Group could incur losses or be required to maintain higher levels
of capital as a result of limitations or failure of various models.
- NWM Group's financial statements are sensitive to underlying
accounting policies, judgements, estimates and assumptions.
- Changes in accounting standards may materially impact NWM Group's
financial results.
- NatWest Group is subject to regulatory oversight in respect of
resolution, and NatWest Group could be adversely affected should the BoE in
the future deem NatWest Group's preparations to be inadequate.
- NatWest Group (including NWM Group) may become subject to the
application of UK statutory stabilisation or resolution powers which may
result in, for example, the write-down or conversion of NWM Group entities'
Eligible Liabilities.
Operational and IT resilience risk
- Operational risks (including reliance on third party suppliers and
outsourcing of certain activities) are inherent in NWM Group's businesses.
- NWM Group is subject to sophisticated and frequent cyberattacks, and
compliance with cybersecurity and data protection regulations is becoming
increasingly complex.
- NWM Group's operations and strategy are highly dependent on the
accuracy and effective use of data.
- NWM Group relies on attracting, retaining, developing and remunerating
diverse senior management and skilled personnel, and is required to maintain
good employee relations.
- NWM Group's operations are highly dependent on its complex IT systems
and any IT failure could adversely affect NWM Group.
- A failure in NWM Group's risk management framework could adversely
affect NWM Group, including its ability to achieve its strategic objectives.
- NWM Group's operations are subject to inherent reputational risk.
NatWest Markets Plc Summary Risk Factors
Summary of Principal risks and uncertainties continued
Legal and regulatory risk
- NWM Group's businesses are subject to substantial regulation and
oversight, which are constantly evolving and may adversely affect NWM Group.
- NWM Group is exposed to the risks of various litigation matters,
regulatory and governmental actions and investigations as well as remedial
undertakings, the outcomes of which are inherently difficult to predict, and
which could have an adverse effect on NWM Group.
- Changes in tax legislation (or application thereof) or failure to
generate future taxable profits may impact the recoverability of certain
deferred tax assets recognised by NWM Group.
Climate and sustainability-related risks
- NWM Group and its Value Chain face climate and sustainability-related
risks that may adversely affect NWM Group.
- NatWest Group's strategy relating to climate change, ambitions,
targets and transition plan entail significant execution and/or reputational
risks and are unlikely to be achieved without significant and timely
government policy, technology and customer behavioural changes.
- There are significant limitations related to accessing accurate,
reliable, verifiable, auditable, consistent and comparable climate and other
sustainability-related data that contribute to substantial uncertainties in
accurately modelling and reporting on climate and sustainability information,
as well as making appropriate important internal decisions.
- NWM Group is becoming subject to more extensive, and sophisticated
climate and other sustainability-related laws, regulation and oversight and
there is an increasing risk of regulatory enforcement, investigation and
litigation.
Statement of directors' responsibilities
We, the directors listed below, confirm that to the best of our knowledge:
- the condensed financial statements have been prepared in accordance
with IAS 34 'Interim Financial Reporting', as adopted by the UK and as issued
by the International Accounting Standards Board (IASB);
- the interim management report includes a fair review of the
information required by DTR 4.2.7R (indication of important events during the
first six months and description of principal risks and uncertainties for the
remaining six months of the year); and
- the interim management report includes a fair review of the
information required by DTR 4.2.8R (disclosure of related parties'
transactions and changes therein).
By order of the Board
Tamsin Rowe Jonathan Peberdy Simon Lowe
Interim Chair Chief Executive Officer Chief Financial Officer
24 July 2025
Board of directors
Interim Chair Executive directors Non-executive directors
Tamsin Rowe Jonathan Peberdy Rupert Hume-Kendall
Simon Lowe Thierry Roland
Anne Simpson
Sabrina Wilson
Non-IFRS financial 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-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
Half year ended
30 June 2025 30 June 2024
Litigation Litigation
and Other Statutory and Other Statutory
conduct operating operating conduct operating operating
costs expenses expenses costs expenses expenses
£m £m £m £m £m £m
Staff costs 20 245 265 14 227 241
Premises and equipment - 36 36 - 36 36
Depreciation and amortisation - 6 6 - 4 4
Other administrative expenses 45 315 360 24 287 311
Total 65 602 667 38 554 592
Quarter ended
30 June 2025
Litigation
and Other Statutory
conduct operating operating
costs expenses expenses
£m £m £m
Staff costs 11 118 129
Premises and equipment - 15 15
Depreciation and amortisation - 3 3
Other administrative expenses 22 175 197
Total 33 311 344
Quarter ended
31 March 2025
Litigation
and Other Statutory
conduct operating operating
costs expenses expenses
£m £m £m
Staff costs 8 128 136
Premises and equipment - 21 21
Depreciation and amortisation - 3 3
Other administrative expenses 24 139 163
Total 32 291 323
Quarter ended
30 June 2024
Litigation
and Other Statutory
conduct operating operating
costs expenses expenses
£m £m £m
Staff costs 7 110 117
Premises and equipment - 19 19
Depreciation and amortisation - 2 2
Other administrative expenses 32 167 199
Total 39 298 337
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 subsidiary and
associated undertakings. 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' represent pence in the United Kingdom ('UK'). Reference 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 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 accounts
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 initiatives to transition to a
net zero economy, climate and sustainable funding and financing and financed
emissions.
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 and H1 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 continued
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
sustainable funding and 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 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 Non-IFRS financial measures and APMs
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
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 IR EAFXLAADSEAARecent news on Natwest
See all newsREG - NatWest Group plc - Transaction in Own Shares
AnnouncementREG - NatWest Group plc - Transaction in Own Shares
AnnouncementREG - NatWest Group plc - Total Voting Rights
AnnouncementREG - NatWest Group plc - Holding(s) in Company - Norges Bank
AnnouncementREG - NatWest Group plc - Transaction in Own Shares
Announcement