The Press and Journal (Aberdeen and Aberdeenshire)
NatWest profits at highest level since before banks crisis
The chairman of NatWest has said the banking sector is “evolving rapidly” as he acknowledged the lender faced “unexpected challenges” during 2023.
Rick Haythornthwaite, who stepped into the role earlier this month, addressed the bank’s shareholders at its annual general meeting yesterday.
He said: “Clearly 2023 was an exceptional year that brought challenges for our customers, our sector, and the economy, as families and businesses faced the fastest rate-rise cycle since the 1970s with persistently high levels of inflation.
“The year brought unexpected challenges but our foundations and performance are strong. In fact profits for 2023 were at the highest level they have been since before the 2008 financial crisis.”
The lender, includes Royal Bnk of Scotland, reported a yearly operating pre-tax profit of £6.2 billion, the highest since just before it was bailed out by the UK Government. It came in a turbulent year for the group’s leadership in the wake of the debanking saga involving NatWest subsidiary Coutts and the former Ukip leader Nigel Farage.
The issue culminated in the exit of chief executive Dame Alison Rose followed by the boss of Coutts, Peter Flavel.
Dame Alison was replaced by Paul Thwaite, who previously headed the bank’s commercial business.
Mr Thwaite, speaking at the AGM in Edinburgh, stressed that NatWest is “prioritising bank-wide simplification to become more efficient”.
This will involve using automation and artificial intelligence (AI) technology to speed up processes.
For example, Mr Thwaite said the bank has worked with technology partners to bring five legacy systems together into one customer platform in its retail arm.
“A bank-wide exercise in 2023 identified over 100 priority-use cases for AI to address manual operations processes and wider controls,” he revealed.
“Ultimately, we want to build a NatWest Group that is simpler and more productive to better serve our customers.”
Meanwhile, Mr Haythornthwaite said the government’s plan to sell its remaining stake in NatWest to retail investors will “bring an end to a sorry tale for the UK and for the bank”. He was referring to the 2008 financial crisis which resulted in the group, formerly called Royal Bank of Scotland, being rescued by UK taxpayers.
The chairman stressed that HM Treasury has had less intervention in the bank than often perceived, but offloading its stake will remove the “overhang” of its involvement.
The government’s ownership of NatWest currently stands at 29%, having started the year at almost 38%. The sale of shares to ordinary investors is expected to go ahead as early as the summer.