LONDON, March 28, 2026, 20:09 GMT
NatWest Group’s shares rose 0.9% on Friday to about 540 pence after Deutsche Bank raised its target on the lender to 840 pence from 730 pence and said the stock had been “unfairly derated”. The move stood out in a softer London market, with the FTSE 100 finishing 0.05% lower. 1
The move matters because NatWest heads into first-quarter results on May 1 as investors try to gauge how long its UK-focused model can hold up if the outlook for British borrowers worsens. For a bank centred on retail, commercial and private banking at home, shifts in mortgage stress, deposit pricing and credit quality tend to show up quickly. 2
That backdrop hardened this week. Chancellor Rachel Reeves met NatWest, Lloyds, HSBC, Barclays, Santander and Nationwide, and the Treasury said lenders would proactively contact 1.6 million customers whose fixed-rate deals end between now and year-end. Officials also pointed to Mortgage Charter relief, including locking in a new rate up to six months early or moving to interest-only payments for six months, while saying about 86% of mortgages are on fixed rates. 3
NatWest also kept returning capital. A Friday filing showed the bank bought back shares across the London Stock Exchange, CHIX and BATE during the week through UBS and plans to cancel the repurchased stock, leaving 195.1 million shares in treasury after settlement. 4
Separate disclosure on Thursday showed Capital Group had cut its voting rights in NatWest to 4.991397% from 5.005597%, slipping just under the 5% level that triggers a market disclosure. 5
The bank has already given shareholders a fuller case this year. NatWest reported a 24% rise in 2025 pretax profit to 7.7 billion pounds in February, lifted its 2028 return on tangible equity target to above 18% — a bank measure of profit against shareholder capital — and announced a 750 million pound buyback for 2026. Days earlier it had agreed to buy wealth manager Evelyn Partners for 2.7 billion pounds including debt, its biggest deal since the 2008 bailout, while Barclays and Lloyds were also lifting profitability ambitions. CEO Paul Thwaite said then NatWest was “raising our ambition and sharpening our strategic focus”. 6
Morningstar analyst Niklas Kammer added another strand on March 16. He raised his fair value estimate to 710 pence and said NatWest screened as the “most attractive UK bank” in his coverage, helped by a stronger structural hedge — the practice of locking in returns on part of a stable deposit base — though he also warned the Evelyn acquisition brought execution risk. 7
But the case is not one-way. Reuters reported earlier this week that the average two-year fixed mortgage rate had jumped to 5.51% from 4.83% since the Iran conflict began, and official forecasts say Britain’s heavy use of fixed-rate home loans slows the pass-through from higher borrowing costs rather than erasing it. If energy-driven inflation keeps rates higher for longer, NatWest’s domestic focus could start to look like concentration risk, not comfort. 8
