The bank reported total gross new mortgage lending of £5.2bn in the three months until the end of March 2024. This compares to £9.9bn in the equivalent period the year before, and the £5.4bn reported in the last quarter of 2023. 

Overall net loans to customers increased by £1.4bn in the quarter, but this was largely due to a significant increase in commercial and institutional lending which NatWest said partially offset the £1.7bn reduction in its retail banking division due to higher mortgage redemptions. 

Despite the lack of demand in the mortgage market, NatWest delivered a pre-tax profit of £1.3bn for the first quarter, below the £1.9bn reported in first quarter of 2023. However, as with Barclays yesterday these profits were ahead of analysts’ forecasts. 

These results also show NatWest delivering marginally higher pre-tax profits than the £1.2bn reported for the last three months of last year. 

Looking specifically at its retail banking, NatWest generated total income of £44m – a 3.2% drop on the previous quarter. The bank said this was due to “continued mortgage margin dilution” – as well as one fewer day in the comparable three month period. 

NatWest’s chief executive Paul Thwaite says: “NatWest Group has delivered a strong set of results for the first quarter – with an operating profit of £1.3 billion.

“Our performance is grounded in the vital role we play in the economy and in the lives of our 19 customers. Though macro-uncertainty continues, customer confidence and activity is improving, with both lending and deposits up in the quarter and impairments remaining low, reflecting our well-diversified business.”

He adds that the bank was pleased with recent momentum regarding the further reduction of HM Treasury’s stake in the bank.

Hargreaves Lansdown analyst Matt Britzman says that NatWest’s results were “the best of the bunch” when compared to other high street banks. NatWest, Lloyds and Barclays have all reported a fall in pre-tax profits driven largely by a subdued mortgage market in the UK.