London, Jan 16, 2026, 07:54 GMT — Premarket
- NatWest shares climbed 1.4% to close at 639 pence on Thursday
- The bank announced a new batch of share buybacks, averaging 640.29 pence each
- Next week’s UK inflation and labour figures will be the next key tests for rate-cut expectations
NatWest Group Plc shares ended Thursday’s session 1.4% higher at 639 pence, positioning the stock for attention when London markets reopen Friday. (Yahoo Finance)
The FTSE 100 hit a record closing high, boosted by a broad rally in UK financial stocks. Barclays, HSBC, and Lloyds all climbed, even as traders factored in about 40 basis points of Bank of England rate cuts by September—a basis point equals one-hundredth of a percentage point. Axel Rudolph, IG’s senior financial analyst, described the stronger-than-expected UK GDP as “a potential catalyst for inflows.” (Reuters)
NatWest signaled additional share buybacks, aiming to cut the share count and boost earnings per share, assuming profits remain steady. In a recent filing, the bank revealed it repurchased 827,445 shares on Jan. 15 at an average price of 640.29 pence and intends to cancel them. After the transaction, NatWest holds 219.6 million shares in treasury. (Investegate)
The macro backdrop brightened slightly. UK gross domestic product rose 0.3% in November, rebounding from a 0.1% drop in October. Car production surged as Jaguar Land Rover resumed full operations following a cyberattack, Reuters reported. Stuart Morrison, research manager at the British Chambers of Commerce, noted: “Firms are telling us they’re still cautious about investing and recruiting.” (Reuters)
Regulation is back on the radar for bank shares. The Bank of England’s Prudential Regulation Authority plans to move major lenders from an annual to a biennial supervisory cycle, reducing the number of “Periodic Summary Meetings” — the formal risk reviews for regulated banks — to once every two years. Deputy Governor Sam Woods said this shift will “streamline firms’ interactions with the PRA.” (Reuters)
The BoE’s quarterly Credit Conditions Survey, released Thursday, showed lenders saw secured credit availability to households climb in the three months ending November, with a modest uptick expected over the next quarter. This is key for UK banks like NatWest, where mortgages and consumer loans drive a big chunk of revenue. (Bank of England)
Rate expectations are still the key driver. Bank of England policymaker Alan Taylor said Wednesday that interest rates “should continue on a downward path,” with inflation expected to hit the central bank’s 2% target sooner than earlier forecasts suggested. (Reuters)
Investors are eyeing two key UK data points next week: the labour market report on Jan. 20 and December’s inflation figures on Jan. 21. Either release could jolt rate cut forecasts, which usually moves bank stocks fast by altering loan growth and margin outlooks. (Gov)
The Bank of England’s next Monetary Policy Committee meeting is scheduled for Feb. 5. (Bank of England)
NatWest’s next major event is its annual results. According to the bank’s investor calendar, the full-year 2025 results are set for 7 a.m. GMT on Feb. 13, with a management presentation to follow that same morning. (NatWest Group Investors)
But there’s a snag. Two former BoE officials slammed the central bank’s recent decision to cut system-wide capital requirements, labeling it a “capital mistake” amid growing financial system risks. If regulators push back with stricter capital rules, buybacks could take a hit, dragging down valuations. (Reuters)
Heading into Friday, attention turns to whether UK banks can maintain their gains following Thursday’s rebound. NatWest will be in the spotlight as it approaches its results on Feb. 13 and upcoming data, with investors keen to gauge its net interest margin — the gap between loan earnings and deposit costs — along with any hints on capital return strategies.
