NatWest using data, tech to boost client experience
$890B bank cut headcount by 2.8% YoY in Q3
NatWest is looking to customer data to drive deposits amid uncertain macroeconomic conditions.
The $890 billion bank is dealing with inflationary pressures and working to reduce costs. Technology is part of the strategy, Chief Executive Paul Thwaite said during the bank’s third-quarter earnings call today.
“We remain focused on driving and delivering the outcomes we set out earlier this year — simplification, digitization, and using data and technology to better serve our customers,” Thwaite said.
THE BIGGER PICTURE: Between 2023 and 2025, the Edinburgh, Scotland-based bank expects to invest 3.4 billion euros ($4.2 billion) into operations to future-proof the business. Its “ongoing digital transformation helps to drive efficiencies, improve customer experience and deliver future growth,” Chief Financial Officer Katie Murray said during NatWest’s second-quarter earnings call in July.
Meanwhile, to streamline, the bank trimmed headcount to 13,400, down 2.8% year over year, according to the company’s Q3 earnings supplement. It also plans to close more than 81 branches by the end of this year to cut costs and encourage adoption of digital banking.
Other European and U.S. banks are taking similar approaches to remain cost-efficient. Deutsche Bank and Wells Fargo also trimmed staff to reduce costs.
BY THE NUMBERS: In Q3, NatWest reported;
- Total income of $4.1 billion, up 8% YoY;
- Operating expenses of $2.3 billion, up 1.6% YoY; and
- Net interest income of $3.1 billion, up 1.7% YoY.
FLASHBACK: NatWest has been moving its operations to the cloud to increase efficiency. Since July, the bank has added Cloudflare Radar, Amazon Web Services and Imperva Incapsula to its tech stack.
The bank is also using Amazon Web Services’ generative AI to improve client financial well-being by providing them with an AI-driven budgeting plan.
MARKET REACTION: Shares of NatWest [NYSE: NWG] were down 12.99% from market open to $4.42 as of market close today. NatWest has a market capitalization of $22.74 billion.
Editor’s note: All amounts have been converted to U.S. dollars.
