NatWest Group expects its revenue this year to likely decline because the business of this company is currently under pressure due to falling interest rates.

The mentioned financial services sector player predicts that total revenue for the current year will be fixed in the range of 13 billion to 13.5 billion pounds ($16.3 billion-$16.9 billion). The relevant information is contained in the company’s statement, which was published on Friday, February 16.

Last year, NatWest Group earned 14.7 billion pounds. This result is a more significant drop compared to the negative dynamic indicators that experts predicted.

Higher interest rates increased interest income, but at the same time provoked spurred competition for deposit customers. NatWest Group has recorded trends in the intensification of the shifting of consumers to fixed-term accounts. These actions of clients are explained by their desire to take advantage of more favorable rates. Against this background, NatWest Group’s margin decreased in the fourth quarter of 2023, as interest expenses increased.

Katie Murray, the company’s chief financial officer, said on a conference call with reporters that she expected the Bank of England to cut benchmark interest rates five times in the current year and begin implementing the appropriate policy from May. These decisions will affect interest income in the future.

Paul Thwaite, who was confirmed as Group Chief Executive Officer and Executive Director on Friday, said that in 2024 the company will focus on what can be controlled, including improving efficiency and productivity, ensuring profitability growth, management of cost and capital.

As we have reported earlier, NatWest Launches Intellectual Property-Based Lending.