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(Sharecast News) - On an otherwise quiet day for corporate releases, attention will turn to NatWest's full-year results on Friday.
UBS said it expects pre-tax profit (ex L&C) of 1.75bn and a CET1 of 13.4%.
"Key focus on the day, we think, are the new medium term targets to FY28 and what those imply for the durability of current hedge-assisted premium revenue growth, an area of market debate versus close peer Lloyds Banking Group in particular, and the importance, or otherwise, of potential future M&A," it said.
UBS expects NatWest to confirm expectations for a return on tangible equity of about 18% through the plan and its intention to operate towards the lower end of the 13-14% previous CET1 target range.
"Given the very strong capital generation of the franchise at that ROTE and Lloyds Banking Group's stated intention to run at 13.0-13.25% we think the 100bps past range is now too wide or, if retained, will prompt questions around capital hoarding and efficiency," UBS said.
It also expects management to guide to some normalisation in loan losses versus the FY25.
According to a Sky News report on Thursday, NatWest will disclose alongside its results that it awarded bonuses of nearly 500m last year, as it returned to full private ownership 17 years after it was rescued by taxpayers.
Sky said the lender will announce that its bonus pool for 2025 was just over 490m, up 10% on the previous year.
In Europe, results are due from Safran, CapGemini and Norsk Hydro, while Moderna is slated to report in the US.
On the macro front, the latest eurozone unemployment, GDP and trade balance figures are due at 1000 GMT.
In the US, the consumer price index for January will be released at 1330 GMT.
Michael Hewson at MCH Market Insights noted that the December CPI was unchanged at 2.7%, having been at 3% in September before the US government shutdown, helping to give the Federal Reserve cover to cut rates by 25bps just before Christmas.
"The slowdown in price pressures did come with a whole load of caveats, given that the report was missing a number of key data points, while many companies offered big discounts in the lead up to Christmas which is likely to have acted as a downward pull-on price," he said.
"Recent PPI data does appear to suggest that price pressures are benign so it will be interesting to see if there is a modest rebound in prices as discounts roll off and 2026 gets underway."
Friday February 13
INTERIM DIVIDEND PAYMENT DATE
FIH Group , Jet2, JPMorgan Emerging Markets Growth & Income, Solid State
QUARTERLY PAYMENT DATE
Thor Explorations Ltd (DI)
INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Balance of Trade (EU) (10:00)
GDP (Preliminary) (EU) (10:00)
Wholesale Price Index (GER) (07:00)
FINALS
NATWEST GROUP
SPECIAL DIVIDEND PAYMENT DATE
Hargreave Hale AIM VCT , Thor Explorations Ltd (DI)
AGMS
Agronomics Limited
FINAL DIVIDEND PAYMENT DATE
AJ Bell, Baillie Gifford European Growth Trust , Hargreave Hale AIM VCT , Premier Miton Group, Unicorn AIM VCT