NatWest

NatWest is a major UK retail and commercial bank, serving over 19 million customers. The business is generating robust returns, including a 17.5% return on tangible equity in 2024, supported by higher interest rates and low impairment rates in the UK. The business has delivered growth across its three divisions of personal, commercial and private banking. The company is focused on simplification and investing in technology to support customer service and operational efficiency. The combination of an improving outlook, good visibility of returns and strong balance sheet supports an attractive above-market distribution yield. NatWest has taken significant strides in recent years to enhance its sustainability credentials. These include growing its climate and sustainable funding and financing business, gradual improvements in gender and ethnic diversity in management, and major work on internal culture and investment in training for staff. The company reports detailed analysis of its financed and facilitated emissions, and has ambitious targets to decarbonise its lending portfolio. Furthermore, it is putting in place the foundations, such as sustainable-finance solutions, including green mortgages, to take advantage of opportunities from home energy efficiency investments in the UK, once the policy environment improves. Companies selected for illustrative purposes only to demonstrate the investment management style described herein and not as an investment recommendation or indication of future performance.