CEO outlines rising operational pressures as reason behind transition
NatWest Group Plc has started transitioning elements of its wealth management division from Switzerland back to the UK, as part of a wider initiative by CEO Paul Thwaite to streamline expenses across the bank.
Speaking at a Goldman Sachs investor forum on Thursday, Thwaite confirmed that the group is also transferring certain functions to more cost-effective regions, including India, in an effort to balance rising operational pressures. Despite challenges such as wage inflation, he expressed confidence that the bank would maintain cost discipline throughout the year.
“Like all banks you have some inevitable cost pressures,” Thwaite said as quoted by Bloomberg. “But, on the other side, you have to work very hard and drive multi-year efficiencies.”
The move is part of a broader strategic cost-reduction programme under Thwaite’s leadership. Alongside relocating specific jobs, NatWest has been consolidating its office footprint. Last year, the bank shut down its Polish operations, resulting in approximately 1,600 job losses, as previously reported by Bloomberg News.
The lender expects total operating costs to reach about £8.1 billion in 2025, which includes £100 million in one-off integration-related expenses. NatWest has also been active in the M&A space, acquiring J Sainsbury Plc’s banking business and securing a mortgage book from Metro Bank Holdings Plc.
Shares in NatWest have surged 27% since the beginning of the year, significantly outperforming the FTSE 100 index, which has risen by 8.5% over the same period. Despite the strong share performance, Thwaite reiterated the bank’s commitment to capital returns.
“We are generating enough capital to both grow the business and think about returns to shareholders,” he noted.
Elsewhere at the conference, Lloyds Banking Group Plc’s chief financial officer William Chalmers said that his bank is also increasing its hiring activity in India. When questioned about the alignment of this strategy with Lloyds’ domestic focus, Chalmers said the move supports its UK operations rather than undermining them.
“We are able to access, as I say, a broad range of skills at efficient price points, which in turn helps us to deliver ultimately very competitive and I hope compelling customer propositions,” Chalmers said. “What we’re doing is effectively complementing the UK setup - the UK workforce and skillset.”
