London, Jan 27, 2026, 09:09 GMT — Regular session underway.
- Shares of NatWest jumped roughly 1.6% during early trading in London.
- Reports suggest UK lenders could raise their medium-term profitability targets, prompting investor attention.
- NatWest has rolled out its latest buyback update, while all eyes turn to the Bank of England’s upcoming rates decision.
NatWest Group Plc shares climbed 1.6% to 661 pence in early Tuesday trading, up from a close of 650.4p the day before.
The shift unfolds as investors brace for UK bank earnings and possible profit-target upgrades, following a strong sector rally. Sources told Reuters NatWest may raise its 2027 return on tangible equity (ROTE) target to 17% from 15%. Peter Rothwell, KPMG UK’s head of banking, noted that UK banks’ earnings resilience has outlasted initial expectations. Meanwhile, Shore Capital analyst Gary Greenwood pointed to the government’s bank tax stance, suggesting it carries “an expectation” that lenders will back growth, potentially driving loan pricing down. Reuters
NatWest announced Monday that it repurchased 811,927 ordinary shares on Jan. 26, paying a volume-weighted average of 651.31p per share. This move forms part of a buyback programme initiated last year. The bank also confirmed plans to cancel these shares, which will lower the total number outstanding, excluding treasury stock.
Separately, Britain’s five largest banks, NatWest among them, pledged a total of 11 billion pounds in lending aimed at helping companies break into foreign markets. UK Export Finance will back as much as 80% of qualifying loans. “Strengthening Britain’s export potential relies on British businesses having the means, motive, and opportunity to succeed in new overseas markets,” said business and trade minister Peter Kyle. Reuters
Bank traders are refocusing on rate expectations, given their impact on lending profits. A Reuters poll found economists largely predict the Bank of England will keep its benchmark rate steady at 3.75% on Feb. 5. However, a narrow majority now anticipates a cut in March. Deutsche Bank’s UK chief economist Sanjay Raja suggested the BoE may adopt a “wait-and-see approach” as it assesses incoming data. Reuters
NatWest is gearing up to release its annual results at 7 a.m. GMT on Friday, Feb. 13, followed by a management presentation later that morning, the bank announced on its investor site.
HSBC, Barclays, and Lloyds are set to report earnings soon, with investors demanding sharper targets and solid plans for capital returns. Traders will keep a close eye on net interest margins — the gap between loan income and deposit costs — especially as forecasts start to factor in rate cuts again.
The trade could shift quickly. If the easing cycle speeds up, margins would take a hit. Add tougher rivalry in mortgages and business loans, and banks might have to cut prices right when investors want bigger returns and more consistent buybacks.
Markets now turn to the Bank of England on Feb. 5. For NatWest, all eyes will be on Feb. 13 to see if its guidance confirms the latest buzz around profit targets.
