NatWest has racked up a legal bill of nearly £300m as it continues to deal with the fallout from a landmark money laundering case.
Litigation and conduct costs for the third quarter were £294m, which included provisions for an anticipated fine in respect of NatWest’s breaches of the UK Money Laundering Regulations 2007, the bank said in results released 29 October.
Earlier in October, the bank said that it had pleaded guilty to breaches of money-laundering regulations.
NatWest said it failed to comply with Financial Conduct Authority regulations from 2012 to 2016, acknowledging that it didn’t monitor the accounts of a UK-incorporated customer as it should have.
However, the bank still reported a more-than-tripled pretax profit for the third quarter, which came in ahead of market views, and said that its guidance for 2021 remains unchanged.
The FTSE 100 listed bank posted a pretax profit of £1.07bn, compared with £355m for the same period a year earlier. Pretax profit was expected to be £735m, according to the bank’s compiled consensus.
Total income also rose ahead of market views to £2.77bn from £2.42bn the year before. It was anticipated to reach £2.63bn, taken from the lender’s compiled consensus.
The bank ended the period with a common equity Tier 1 ratio — a key measure of balance-sheet strength — of 18.7%. It was expected to be 18.3%, according to the bank’s compiled consensus.
“Our robust capital position means that we have been able to buy back £402m of our shares to date while also investing for growth as we support our customers and drive sustainable returns to our shareholders,” chief executive Alison Rose said.
Regarding its costs target, the bank said it delivered a cost reduction of £198m, or 4.3%, for the year to date, and said that it remains committed to its 4% full-year cost reduction target.
Write to Sabela Ojea at [email protected]
This article was published by Dow Jones Newswires