(Sharecast News) - First-quarter profits fell at NatWest Group, the banking group confirmed on Friday, although the decline was less than expected.
The blue chip lender said pre-tax profits in three months to March end came in at £1.3bn, down on the £1.8bn reported a year previously but marginally higher than analyst forecasts for £1.2bn.
Total income fell to £3.5bn from £3.9bn.
The banking sector is facing tough comparables, after income surged as interest rates rocketed.
Net interest margin rose to 2.05% from 1.99% in the previous quarter. It fell to 2.22% in the retail bank, however, as competition in the mortgage market ramped up.
NatWest set aside a total of £93m for bad loans, comfortably below the £186m expected by analysts.
Paul Thwaite, chief executive, said: "NatWest has delivered a strong set of results for the first quarter.
"Our performance is grounded in the vital role we play in the economy and in the lives of our 19m customers. Though macro-uncertainty continues, customer confidence and activity is improving, with both lending and deposits up in the quarter and impairments remaining low."
Looking ahead, the bank left its full-year outlook guidance unchanged, apart from noting that operating costs (excluding litigation and conduct costs) are now expected to be "broadly stable" once the £0.1bn increase in bank levies is stripped out.
The government bailed out NatWest at the height of the banking crisis. It has sold down its shareholding in recent years, however, and now holds less than 30%.
The government recently confirmed it will look to sell the rest of the stake.
Natwest (NWG)
