NatWest Refuses to Share Profits with Savers Despite Record-Breaking Earnings
“We have to look at the whole picture and balance sheet”. NatWest recently announced bumper profits of £5.1bn, the largest amount since 2008. However, only 8% of banks or building societies have increased their savings in response to the recent interest rate rise, leaving many savers disappointed. Dame Alison declined to reassure savers that NatWest would pass on the rate rise, saying they must look at the “whole picture” and “whole balance sheet”.
Full Story – NatWest refuses to pass interest rate rise to savers despite announcing bumper profits
The boss of NatWest, Dame Alison Rose, declined to reassure savers that the bank would pass on a recent interest rate rise on the day it announced bumper profits.
It has only hiked one of its savings accounts since the Bank of England increased the base rate at the beginning of the month: its Digital Regular Saver, from 5 to 6 per cent, although savers can only put £5,000 in the account before the rate plunges to 0.65 per cent.
NatWest’s profit was announced as £5.1bn, a third higher than the £3.8bn posted in 2021, and the largest amount of money it has made since 2008.
Part of the reason its profit has increased is because of the increases to the base rate, most recently to 4 per cent. This makes the “net interest margin” – the difference between what banks charge for mortgages and what they pays savers – currently 2.74 per cent, when previously it was just 2.27 per cent.
Banks have been heavily criticised for refusing to help savers during an intense period of inflation. Research by i has shown that only 8 per cent of banks or building societies have increased their savings rates in response – just 28 out of a total of 357 financial companies.
It used to be that banks would pass on any increases in interest rates to their customers, but that hasn’t been the case in recent years.
NatWest’s average easy access offers 1.8 per cent, while its Flexible Saver account returns just 0.65 per cent.
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