The bank said it no longer expects to achieve the majority of the remaining risk-weighted assets (RWA) reduction towards the medium-term target of £20bn this year.
It seems there are as many views on the recent third-quarter update from NatWest Group as there are brokers, so let’s start with one of the more optimistic ones.
Berenberg has reiterated its ‘buy’ recommendation and nudged up the price target to 250p from 240p.
“The materiality and persistence of NatWest’s net interest income prospects dwarf more modest and short-term weakness in its non-interest income. This strength is underappreciated, such that our FY 2023E net interest income expectations are 5% above consensus. This strength is supported by the bank’s progress towards reducing costs and its strong capital returns of c11% pa,” Berenberg said.
UBS remains sitting on the fence with an unchanged 215p price target after what it said was a ”miss” on pre-provision profit, driven by NatWest Markets.
Deutsche Bank is similarly non-committal, but with a punchier price target of 260p.
“Guidance is mostly maintained with the exception of RWAs [risk-weighted assets] (which is factored into expectations already),” was its verdict.
Read More: NatWest Group PLC has a believer in Berenberg but UBS and Deutsche