NatWest Group PLC (LSE:NWG) reported first-quarter profit ahead of expectations and provided improved guidance for 2026, though it was below City analysts' forecasts.
Chief executive Paul Thwaite said: "We have started the year with positive momentum, underpinned by healthy customer activity - growing all of our three businesses, expanding our capabilities to meet more of our customers' needs and further improving productivity as we use AI at scale across the bank."
The high street lender said it now expects full-year income, excluding notable items, to be at the top end of its £17.2 billion to £17.6 billion guidance range.
However, this was below consensus forecasts of around £18 billion.
More positively, attributable profit for the quarter came in at £1.43 billion, beating forecasts of £1.32 billion, with earnings per share rising 15.5% year-on-year to 17.9p.
Return on tangible equity softening to 18.2% from 18.3% in the preceding quarter, though costs continued to fall, with more than £100 million of savings delivered and the cost-to-income ratio improving to 46.5%.
Total income inched up 0.8% from the preceding quarter to £4.36 billion due to a 1.4% fall in interest income to £3.39 billion, slightly below estimates.
The net interest margin increased by two basis points in the quarter to 2.47%.
Customer lending and deposits both increased in the quarter. Net loans grew by £7.2 billion, driven by mortgage activity and higher commercial balances, while deposits rose by £3.1 billion.
Capital strength also improved, with the CET1 ratio rising to 14.3%, as the bank generated 65 basis points of capital in the quarter.