NatWest (NWG) Q3 2026 Results: Retail Impairments Rise to £192 Million

NatWest Group (NWG) Q3 2026 results, filed on October 30, 2026 in a Form 6-K interim management statement for the quarter ended September 30, show income on plan but rising retail credit costs [1]. The quarter tested three issues: hedge-driven net interest income, the first full quarter of Evelyn Partners, and impairments as credit card cohorts mature. Net interest income was £3,559 million, up 1.8% from the second quarter [1]. Private Banking & Wealth Management income reached £447 million [2], with positive net inflows [3]. Retail impairments, however, rose to £192 million, above the £184 million booked in the first quarter [4]. The growth engine and cost discipline are intact, but normal retail credit cost has moved higher; full-year impairment guidance still has room.

NatWest serves individuals, high-net-worth clients and businesses through three segments: Retail Banking, Private Banking & Wealth Management, and Commercial & Institutional [5]. It funds mortgages, credit cards and corporate loans with deposits and uses a structural hedge to lock in returns on stable deposits. Net interest income made up about 77% of total income in the first nine months of 2026 [1].

Retail impairments exceed the first quarter as card losses move up

Group impairments doubled, led by retail. NatWest booked £277 million of impairments, equal to 24 basis points of loans, compared with 13 basis points in the second quarter [1][6]. Retail Banking impairments were £192 million, a loan impairment rate of 34 basis points [7]. That exceeds both the first-half quarterly average of £140 million and the first quarter, pointing to rising underlying losses.

The retail increase reflects both a base effect and higher losses. The company mainly cited the non-repeat of one-off second-quarter releases: a scenario update, post model adjustment releases and an unsecured debt sale [4]. Credit card Stage 3 (defaulted) loans rose from £242 million at the end of 2025 to £315 million, and Stage 2 (significantly increased credit risk) card loans rose from £2,081 million to £2,589 million [8]. NatWest said credit card cohorts originated through new business growth since 2022 are maturing, which is pushing more unsecured lending into Stage 3 [9].

Corporate losses are still small, but early indicators are building. Commercial & Institutional net loans grew by £6.7 billion in the quarter, and its £80 million impairment charge reflected higher Stage 3 charges [10]. The segment's loan impairment rate was 19 basis points, versus 10 basis points in the second quarter [11]. Group Stage 2 loans rose to £47,254 million [12], up from £44,915 million at the end of June [13]. Post model adjustments totaled £315 million, broadly flat, with the retail portion shifting toward credit cards [14].

Profit before impairment rose by £77 million from the second quarter, but impairments rose by £137 million, so operating profit before tax fell 2.6% to £2,225 million [1]. The company kept its guidance for a full-year loan impairment rate below 25 basis points; the nine-month rate was 21 basis points, and management described a through-the-cycle range of 20 to 30 basis points [15]. Retail impairments near £190 million a quarter would add about £200 million a year versus the first-half average.

Hedge income and the Evelyn integration are on plan

Deposits still drive net interest income growth. Net interest income rose 8.9% from the third quarter of 2025 [1]. The chief financial officer attributed income growth to Evelyn Partners, deposit margin expansion and one additional day, and the 2.50% net interest margin already absorbs a one-off charge of around £35 million from a review of customer repayment behaviour [16]. Management expects the margin to be flat sequentially into the second half and 2027, with mortgage repricing ending in the fourth quarter [15]. Term balances rose to 19% of deposits [16], so savings are still shifting to higher-cost products.

Evelyn Partners' first full quarter kept revenue and costs within plan. Private Banking & Wealth Management income rose £143 million from the second quarter, and other operating expenses were £286 million [2]. AUM net inflows were £1.0 billion, equal to 3.4% of opening balances on an annualized basis [3]. Clients stayed, but inflows slowed on a larger base. The company does not report Evelyn revenue separately, so the fourth-quarter contribution needs to be slightly higher than the third quarter's to reach the full-year guidance of about £275 million [17].

Conclusion

The quarter confirmed NatWest's growth engine and cost discipline but raised the expected level of credit cost. Income excluding notable items grew 3.1% [6], and other operating expenses grew 2.0% [1]. The normal level of retail impairments rose from about £140 million to close to £190 million a quarter, absorbing the increase in pre-impairment profit. The CET1 ratio rose to 13.5%, and the average liquidity coverage ratio fell to 137% [16].

The fourth quarter is the first clean test of credit cost because the second-quarter base effect falls away. If retail impairments return below the nine-month quarterly average of about £157 million, the third-quarter increase was mainly a base effect. If they exceed £192 million again, the upward shift in card losses will be confirmed. Full-year results will also show hedge income and staged card data.

Sources

All Q3 2026 Interim Management Statement entries refer to NatWest Group plc's Form 6-K filed with the SEC: https://www.sec.gov/Archives/edgar/data/844150/000165495426009258/a0797b.htm

• [1] NWG 6-K filed 2026-10-30 (Q3 2026 Interim Management Statement) · Business performance summary · summary consolidated income statement, 2026-10-30
• [2] NWG 6-K filed 2026-10-30 (Q3 2026 Interim Management Statement) · Private Banking & Wealth Management quarterly table, 2026-10-30
• [3] NWG 6-K filed 2026-10-30 (Q3 2026 Interim Management Statement) · Private Banking & Wealth Management, 2026-10-30
• [4] NWG 6-K filed 2026-10-30 (Q3 2026 Interim Management Statement) · Retail Banking · Q3 2026 performance, 2026-10-30
• [5] NWG 20-F filed 2026-02-17 · reportable segments, 2026-02-17, https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000844150&type=20-F&dateb=&owner=include&count=40
• [6] NWG 6-K filed 2026-10-30 (Q3 2026 Interim Management Statement) · Business performance summary · performance key metrics and ratios, 2026-10-30
• [7] NWG 6-K filed 2026-10-30 (Q3 2026 Interim Management Statement) · Retail Banking quarterly table, 2026-10-30
• [8] NWG 6-K filed 2026-10-30 (Q3 2026 Interim Management Statement) · Credit risk · sector analysis by stage, 2026-10-30
• [9] NWG 6-K filed 2026-10-30 (Q3 2026 Interim Management Statement) · Credit risk · segment analysis – loans, 2026-10-30
• [10] NWG 6-K filed 2026-10-30 (Q3 2026 Interim Management Statement) · Commercial & Institutional · Q3 2026 performance, 2026-10-30
• [11] NWG 6-K filed 2026-10-30 (Q3 2026 Interim Management Statement) · Commercial & Institutional quarterly table, 2026-10-30
• [12] NWG 6-K filed 2026-10-30 (Q3 2026 Interim Management Statement) · Credit risk · segment analysis – portfolio summary, 2026-10-30
• [13] NWG 6-K filed 2026-07-31 (H1 2026 interim results) · loans and ECL by stage, 2026-07-31, https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000844150&type=6-K&dateb=&owner=include&count=40
• [14] NWG 6-K filed 2026-10-30 (Q3 2026 Interim Management Statement) · Credit risk · ECL post model adjustments, 2026-10-30
• [15] NWG earnings call 2026-10-30 (Q3 2026) · Drillr structured call summary, 2026-10-30, not a verbatim transcript
• [16] NWG 6-K filed 2026-10-30 (Q3 2026 Interim Management Statement) · Chief Financial Officer's review, 2026-10-30
• [17] NWG 6-K filed 2026-07-31 (H1 2026 interim results) · 2026 outlook, 2026-07-31, https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000844150&type=6-K&dateb=&owner=include&count=40