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    Edward Hugo Firth • KBW

    Edward Hugo Firth's questions to NatWest Group PLC (NWG) leadership

    Edward Hugo Firth's questions to NatWest Group PLC (NWG) leadership • Q1 2025

    Question

    Ed Firth of KBW questioned the bank's stated interest rate sensitivity, noting that margins have expanded despite falling rates. He asked if the bank can continue to offset rate pressure through pricing and at what rate level this becomes challenging.

    Answer

    Executive Paul Thwaite highlighted recent investments in dynamic pricing capabilities that allow for better management of the deposit book. CFO Katie Murray advised against ignoring the sensitivity disclosure but noted it's based on a static balance sheet. She explained that factors like favorable deposit mix shifts and abating mortgage headwinds have helped performance. She believes pricing flexibility would remain even at lower interest rates.

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    Edward Hugo Firth's questions to NatWest Group PLC (NWG) leadership • Q1 2024

    Question

    Edward Hugo Firth of KBW asked about capital management, questioning the outlook for open market buybacks given the headwinds from a higher share price and upcoming Basel III implementation. He also inquired about the dividend policy, asking if the 40% payout ratio is a strict formula or if it has a progressive element to smooth earnings volatility.

    Answer

    CFO Katie Murray confirmed that while a government buyback would be more expensive, the bank plans for share price movements and remains confident in its capital generation to stay within its 13-14% CET1 target range. She stated that the dividend policy is a strict application of an 'around 40% payout' ratio and that investors should not expect that to change.

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    Edward Hugo Firth's questions to HSBC Holdings PLC (HSBC) leadership

    Edward Hugo Firth's questions to HSBC Holdings PLC (HSBC) leadership • Q1 2025

    Question

    Edward Hugo Firth asked if guidance should be adjusted for the weaker dollar, whether the bank is already in its 'plausible downside scenario' given trade flows, and about the BoCom accounting, questioning why HSBC didn't subscribe to the new capital raise if its valuation is high.

    Answer

    Georges Elhedery, an executive, clarified the downside scenario is more adverse than the current situation and that HSBC was happy with its existing BoCom holding. Manveen Kaur, an executive, confirmed a weaker dollar impacts both costs and revenues, which will be updated quarterly. She reiterated the BoCom dilution has an insignificant impact on CET1 and distributions, and the bank's accounting treatment reflects its status as an associate.

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