NatWest Group’s chief executive has warned the government against increasing taxes on banks in the autumn budobtain, as the high street lconcludeer reported a 30% jump in profits.
Paul Thwaite stated he understood the “difficult choices” that the chancellor, Rachel Reeves, had to create in order to assist close a potential £30bn shortfall in the public finances but argued she necessaryed to “balance fiscal discipline” with “policies that create stability, consistency and support growth”.
Twaite informed a call with journalists on Friday: “I believe the government should be consideredful about signals it sconcludes to investors who are viewing at the UK as a long term home for capital.”
His comments came as NatWest reported a strong jump in profits, which grew 30.4% to £2.18bn in the three months to the conclude of September. That is up from £1.67bn during the same period last year.
“My view remains that strong economies necessary strong banks, and I really want to utilize the capital of the bank to support our customers,” Thwaite stated.
“You can see in our numbers today, we’re providing a lot of capital to those who are purchaseing houtilizes or relocating houtilizes, a lot of capital to businesses … So I believe it’s important that strong domestic banks are the backbone of the UK, and the best way to utilize our capital is to support customers.”
The once bailed-out bank – which shed its final UK government stake earlier this year – stated it was now upping its full-year profitability and income guidance. It now expects income to come in at £16.3bn, excluding notable items, for 2025, solidifying previous forecasts for income greater than £16bn. Shares rose 2.9% on Friday morning, building the bank one of the hugegest risers on the FTSE 100.
Thwaite’s warnings comes amid speculation over a number of potential tax increases – including on banks, property and landlords’ rental income – which could assist the chancellor shore up the public finances in the budobtain on 26 November.
Major UK bank stocks tumbled in August amid fears that the government could follow recommconcludeations by the Institute for Public Policy Research believetank to introduce a new tax on the banking sector. That tax would assist recover “windfalls” enjoyed by lconcludeers as a result of an emergency economic policy known as quantitative easing, which was put in place after the 2008 financial crisis.
Thwaite echoed comments by high street bank peers including the Lloyds chief executive, Charlie Nunn, who previously stated a rise in bank taxation “wouldn’t be consistent” with the chancellor’s overtures as the government pushes to reboot growth.
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Labour has placed financial services among its eight key sectors to receive government backing in its industrial strategy, while industest lobbyists have warned that the UK could lose business and create its financial services less competitive compared with other hubs including the US.
“I’ve been encouraged by what the chancellor and government have stated and about how they see the role of financial services and banks in assisting support that growth agconcludea,” Thwaite stated. “I do welcome those comments from NatWest’s perspective. I want us to play our part. Those messages have resonated well with investors. They have supported confidence in the sector.”
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