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Natwest the latest bank to report lower profits due to mortgage lending pressures

ended 26. April 2024

NatWest Group is the latest bank to report much lower first-quarter profits, amid peaking interest rates and mortgage lending pressures.

Revenues were further hit by weaker mortgage margins, amid greater competition in the home lending market and expectations of looming interest rate cuts by the Bank of England.

Earlier this week, Lloyds Bank revealed its pre-tax profits plunged by 28 per cent to £1.63billion in the first quarter of 2024.

Over the same period, Barclays' earnings shrunk by 12 per cent because of lower mortgage lending and deposits, and less activity at its investment banking division.

Good to get your views on this. What impact on rates do you think this will have over coming months? And do you think the banks will pass on any rate cuts immediately if the BoE starts lowering interest rates?

3 responses from the Newspage community

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Katy Eatenton
Mortgage & Protection Specialist at Eatenton Finance
The reduction in profits show the banks are feeling the heat too, but they are still recording massive profits in times when the borrowers are being squeezed on rates, income and cost of living. I'm not going to reach for my violin just yet
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Gary Bush
Financial Adviser at MortgageShop.com
I am suspicious that large banks who previously announced higher turnover levels, some announcing records, are now confirming plunging profits. It's clear that additional investment spending on the running of their businesses can easily affect the bottom line figure - but isn't that speculation rather than bad news? A lot of UK businesses at the moment would love to have had the additional income in the first place to spend.
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Lee Gathercole
Co-Founder at Rebus Financial Services
No surprises here! High street banks are going to have to become more innovative with their offerings, there's no doubt as soon as that rate cut comes there will be banks tripping over each other for top spot.