NatWest Group AGM: CEO touts 19.2% RoTE, bigger dividends and buybacks amid climate, pay pushback

Key Points

• NatWest reported strong 2025 results with GBP 16.4 billion income, GBP 7.7 billion operating profit and a 19.2% return on tangible equity, while returning capital via a 51% jump in dividend to GBP 0.325 and two separate GBP 750 million buybacks after the U.K. government sold its final stake.
• The bank is pursuing disciplined growth and consolidation—highlighting mortgage balances up GBP 7 billion, assets under management up 20%, integration of >1 million Sainsbury’s Bank customers and a GBP 2.3 billion Metro Bank mortgage portfolio, with the Evelyn Partners acquisition expected to close soon.
• Shareholders pressed NatWest over perceived backtracking on climate targets and rising executive pay, prompting the bank to defend its revised approach (pledging GBP 200 billion to customer transition financing by 2030, with ~GBP 19 billion delivered) while acknowledging staff pay tensions after CEO pay rose 33% versus a 2.82% increase for employees.

NatWest Group NYSE: NWG held its 2026 annual general meeting at its Gogarburn headquarters in Scotland, with Chair Rick Haythornthwaite and Group CEO Paul Thwaite highlighting the bank’s recent performance, capital returns to shareholders, strategic priorities, and a range of shareholder concerns—most prominently around climate policy and employee pay.

Return to full private ownership and shareholder returns

In opening remarks, Haythornthwaite pointed to the significance of the U.K. government’s sale of its final stake in May 2025, describing it as a milestone that “turns the page on an important chapter in our history” and reflects NatWest’s transformation into a “simpler, stronger, and more customer-oriented” bank.

He said the group delivered “attractive returns” through dividends and share buybacks. Haythornthwaite noted NatWest raised its dividend payout ratio and announced total dividends per share of GBP 0.325, up 51% year-over-year. The bank also announced two separate GBP 750 million buybacks—one in July and another at full-year results.

Haythornwaite said the group aims to invest for future growth while allocating capital “with discipline,” including considering acquisitions where there is “a clear strategic fit and value for shareholders.” He cited the acquisition of Evelyn Partners as an example of the bank’s momentum.

CEO outlines 2025 results and three strategic priorities

Thwaite framed the strategy around whether the bank is “making it easier for people, businesses, and communities across the U.K. to make progress,” telling shareholders he believed NatWest could answer “yes” based on 2025 performance.

He reported 2025 financial results of GBP 16.4 billion in income, GBP 7.7 billion in operating profits, and 19.2% return on tangible equity, all “significantly higher than the year before.” He also said the bank supports “more than 20 million” people, families, and businesses across the U.K.

Thwaite described progress against three strategic priorities:

• Disciplined growth: Thwaite said deposits, lending, and assets under management increased year-over-year. He cited new offerings including a “family-backed mortgage” and expanded intellectual property-backed lending. In retail, he said NatWest grew mortgage balances by GBP 7 billion and helped “over 50,000 customers” buy their first home. In wealth, he said assets under management rose 20%, including “50,000 customers investing with us for the first time.”
• Simplification and technology: Thwaite said reducing complexity improves productivity and customer experience, and he characterized AI as an “accelerant” when applied responsibly, enabling faster innovation and “more personalized and safer services.”
• Active risk and balance sheet management: Thwaite said strong capital generation is supported by a “resilient, well-diversified loan book,” positioning NatWest to support customers through uncertainty while investing in the business and returning capital to shareholders.

Thwaite also discussed the integration of more than 1 million Sainsbury’s Bank customers and a GBP 2.3 billion mortgage portfolio from Metro Bank. He said the previously announced acquisition of Evelyn Partners is expected to complete “in the months ahead,” describing it as a response to rising demand for financial planning and advice amid longer lifespans, generational wealth transfer, and technology-driven change.

Climate policy questions dominate shareholder discussion

Several shareholders raised concerns that NatWest had reduced the ambition of its climate policies and targets.

Mara Lilley, speaking on behalf of the Church of England Pensions Board, said the group was voting against Haythornwaite’s re-election, citing concerns about “backtracking” on climate commitments and climate-risk governance. She asked why NatWest moved from requiring oil and gas clients to have Paris-aligned transition plans to “a more flexible approach” under new risk acceptance criteria.

Haythornwaite said the board takes climate change “very seriously” and referenced the U.K. Climate Change Committee’s seventh carbon budget in describing the need to balance supporting customers’ transition efforts with risk management in a “complex policy environment.” He said key commitments remain, including halving “the impact of our climate finance commitments by 2030” and reaching net zero by 2050. He also said NatWest increased funding it is willing to provide for customers’ transition efforts to GBP 200 billion by 2030, adding that the bank had delivered about GBP 19 billion so far.

Haythornwaite stated that oil and gas financing represents 0.6% of total lending and said NatWest will not finance shale oil and gas, oil sands, coal gas, methane, or coal liquefaction. He also described a governance process for opportunities above GBP 50 million that evaluates the balance between oil and gas investments and company transition commitments.

Jeanne Martin, Head of Banking Programme at ShareAction, speaking on behalf of ShareAction and 19 institutional shareholders representing $1.39 trillion in assets under management, said investors were concerned about changes announced in February, including dropping certain commitments related to financing oil and gas majors and removing targets covering aluminum, cement, and iron and steel. Martin asked whether Haythornwaite would personally meet the group within three months. He agreed, saying he was “more than happy to meet.”

In responding, Haythornwaite said there had been “no shift” in the bank’s credit risk appetite and characterized the 2021 approach of relying on “credible transition plans” as a “very crude proxy.” He said NatWest moved away from that approach as its ability to assess and manage such investments improved. He also said the bank shifted from Science Based Targets initiative metrics toward the UNEP Finance Initiative approach and moved from 16 sector targets to nine activity targets. On the removal of aluminum and cement targets, he said the bank does not meaningfully invest in those sectors and lacks in-house expertise there.

Kathryn Beckman said she had joined 70 academics and experts who signed an open letter urging NatWest to reverse what they viewed as backtracking on climate commitments. Haythornwaite said the board did not believe the changes breached any moral or fiduciary duty, describing the need to manage trade-offs and follow a “pragmatic middle road,” while remaining “really strict” through governance processes.

Employee pay and other shareholder issues

Pay and compensation also drew questions. Michelle Smith of Unite the Union cited the annual report as showing CEO total remuneration up 33% over the past year, while shareholder payouts through dividends and buybacks were up “over a quarter” to “almost GBP 3 billion,” compared with a 2.82% increase in employee remuneration. She asked whether the board viewed this as acceptable and sought a commitment to allocate sufficient funding to support “decent and proportionate pay rises” in 2027.

Haythornwaite praised Unite’s “constructive” engagement and said NatWest seeks an agreement meeting “competitiveness and fairness,” while noting executive pay is subject to shareholder vote and competition for talent. He said the bank aims to “give our colleagues a fair reward” while balancing long-term sustainability.

Simon Godfrey, also of Unite, raised concerns about pay ratios and asked for a similar commitment on funding pay rises. Haythornwaite said the board and senior executives “do not seek to exceed” the main workforce’s salary increases, adding that employees can share in the company’s success through share schemes and variable pay.

Additional questions included a request from Kelly Shields of ShareAction, speaking on behalf of several groups, about NatWest’s involvement as a bookrunner in project finance loans tied to Rio Grande LNG projects in Texas and the bank’s approach to Indigenous rights. Haythornwaite said NatWest operates a “UK nexus” approach that can lead it to support clients on broader projects internationally, said the bank would not comment on individual projects, and stated it assesses project financing through the Equator Principles, referring the questioner to the group’s sustainability team for further engagement.

The meeting concluded after additional comments from shareholders, including a question about whether the Royal Bank of Scotland name might return. Haythornwaite responded that “it will always be the Royal Bank here,” referencing the bank’s upcoming 300th anniversary.

About NatWest Group NYSE: NWG

NatWest Group plc is a major UK-based banking and financial services group headquartered in Edinburgh, Scotland. The company traces its roots to the Royal Bank of Scotland, founded in 1727, and adopted the NatWest Group name in 2020 as part of a strategic refocus on its NatWest brand. NatWest Group is listed on the London Stock Exchange and also has American depositary shares trading on the New York Stock Exchange under the symbol NWG.

The group provides a broad range of banking services across retail, private, commercial, corporate and institutional segments.

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