The NatWest share price has surged to its highest level in 15 years, reflecting strong investor confidence following the bank’s robust third-quarter earnings. NatWest Group plc reported an impressive pre-tax profit of around £2.2 billion for Q3 2025, significantly higher than the £1.7 billion reported in the same quarter last year and above market expectations of £1.8 billion.
The solid performance has pushed the NatWest share price up by nearly 7% in intraday trading, marking the bank’s best performance since May 2010. Investors are responding positively to the bank’s upgraded full-year profit guidance and improved capital returns, reinforcing optimism around the UK banking sector.
Profit Growth and Strong Fundamentals Drive Momentum
NatWest’s remarkable quarterly results stem from several key drivers that have strengthened its fundamentals and contributed to the steady rise in the NatWest share price. The bank’s total income rose to approximately £16.3 billion on the back of improved lending activity, higher interest income, and effective cost management.
The net interest margin (NIM) — a crucial profitability indicator for banks — improved to around 2.37%, compared to 2.28% in the previous quarter. This reflects the bank’s ability to benefit from the current interest rate environment while maintaining a healthy loan book. Moreover, NatWest added roughly £4.4 billion in new lending during the quarter, including £1.7 billion in mortgage growth, strengthening its market position.
Additionally, the bank reported lower-than-expected bad loan provisions, at approximately £153 million compared to earlier forecasts near £190 million. This lower reserve release reflects NatWest’s prudent risk management approach and stable asset quality — factors that have further boosted confidence in the NatWest share price.
CEO Paul Thwaite’s Strategy Strengthens Investor Confidence
Under the leadership of CEO Paul Thwaite, NatWest has been executing a strategy focused on operational efficiency, customer growth, and digital transformation. This strategic clarity has been instrumental in restoring market confidence and driving sustained upward momentum in the NatWest share price.
The bank’s return on tangible equity (RoTE) — a key measure of profitability — was upgraded from 16.5% to 18%, signaling improved financial performance and capital allocation efficiency. Investors have also welcomed NatWest’s focus on enhancing shareholder returns, supported by a strong capital position and potential for further dividend payouts or share buybacks.
Market Reaction and Outlook for NatWest Share Price
The upward momentum in the NatWest share price is not only a reflection of current earnings strength but also growing investor belief in the long-term stability of the UK banking sector. However, analysts remain watchful of certain challenges that could influence future performance.
Customer deposits declined by roughly £1.1 billion in Q3, a minor but notable sign of pressure on funding sources. Moreover, macroeconomic factors such as fluctuating interest rates, inflation trends, and potential credit risks remain key variables that could affect earnings in the coming quarters.
Despite these risks, market analysts maintain a positive outlook for the NatWest share price, citing the bank’s solid fundamentals, earnings resilience, and focus on efficiency. Some forecasts suggest a 12-month target price of around 605 pence, indicating further potential upside from current levels.
What It Means for UK Banking Investors
The recent rally in the NatWest share price underscores renewed optimism in the UK financial sector. Investors have rewarded banks capable of navigating inflationary challenges, expanding their lending portfolios, and delivering consistent profitability. NatWest’s disciplined execution, combined with its robust digital banking strategy, has set a strong foundation for sustained growth.
For long-term investors, the NatWest share price represents a blend of stability, income potential, and exposure to the UK’s financial recovery. The bank’s continued improvement in profitability metrics and its commitment to shareholder value could help maintain this upward trend in the months ahead.
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