NatWest Falls As Net-Interest Margin Drop Weighs

NatWest Group shares are among the biggest FTSE 100 fallers, down 3.5% after the U.K. bank reported a lower third-quarter net-interest margin. With potentially higher U.K. interest rates looming, the margin reduction has somewhat disappointed the market, AJ Bell says. "This situation puts pressure on the bank to start charging more for its lending products and it hasn't wasted time in doing so, lifting its fixed-rate mortgage deals immediately after this week's Budget," Bell investment director Russ Mould says. "There is a difficult balancing act, as the mortgage market has been incredibly competitive during a period of incredibly low interest rates. NatWest will have to ensure it doesn't increase its rates to the extent that borrowers can find better deals elsewhere." 


 
Companies News:

Time Out Expects Return to Pre-Covid Performance in Near Term

Time Out Group PLC said Friday that it is confident of a return to pre-Covid performance levels within the coming months as it reported earnings for the 18 months that were hurt by coronavirus-related restrictions.

---

TBC Bank Prices $75 Mln Subordinated Notes

TBC Bank Group PLC said Friday that it has attracted solid demand from investors across Europe, the U.K. and the U.S. after pricing $75 million subordinated notes.

---

Tintra 1H 2022 Pretax Loss Widened

Tintra PLC said Friday that its pretax loss widened for the first half of fiscal 2022 it booked higher costs, but that the board viewed the next six months with optimism.

---

Limitless Earth Reports Widened 1H Net Loss

Limitless Earth PLC on Friday reported a widened net loss for the first half of the fiscal year.

---

Nostrum Oil & Gas 9-Month Revenue Rose; Shares Rise

Nostrum Oil & Gas PLC shares rose Friday after it said that it expects revenue for the first nine months of 2021 to be higher on year, despite a fall in production.

---

Scancell FY 2021 Pretax Loss Widened on Increased Expenses

Scancell Holdings PLC said Friday its fiscal 2021 pretax loss widened significantly on increased administrative and development expenses, higher interest and finance expenses.

---

Serica Energy Downgrades FY Net Production on Delay of Columbus Field Production

Serica Energy PLC said Friday that its full-year net production is expected to be slightly lower than guided due to delays affecting its Columbus field, located in the U.K.'s North Sea.

---

Panthera Resources to Acquire Indian JV Partner for $1.4 Mln

Panthera Resources PLC said Friday that it will acquire its Indian joint-venture partner, Metal Mining India Private Ltd., or MMI, for 1.8 million Australian dollars ($1.4 million).

---

SysGroup Expects 1H 2022 Revenue, Adjusted Ebitda Fall

SysGroup PLC said Friday that it expects revenue and adjusted Ebitda to fall for the first half of fiscal 2022, and that the long-term outlook for the business and its market remains very positive.

---

Plus500 Board Approves Additional Buyback of Shares

Plus500 Ltd. said Friday that it will acquire an additional $12.6 million of its own issued share capital as part of its share buyback program.

---

Condor Gold Raised GBP4.1 Mln in Placing for Feasibility Study, New Mill

Condor Gold PLC said Friday that it has raised 4.1 million pounds ($5.7 million) through a private placement of shares, to pay for a feasibility study and the balance of a new mill.

---

NatWest 3Q Pretax Profit More Than Tripled, Beating Market Views -- Update

NatWest Group PLC on Friday reported a more-than-tripled pretax profit for the third quarter, which came in ahead of market views, and said that its guidance for 2021 remains unchanged.

---

Computacenter 3Q Slightly Beat Management Views; Backs 2021 Guidance

Computacenter PLC said Friday that its third quarter finished slightly above its expectations, and it backed its full-year guidance for record revenue, profits and earnings per share. 


 
Market Talk:

BOE Likely to Raise Rates Next Week, Trim QE, Says Deutsche Bank

0935 GMT - The Bank of England is likely to raise borrowing costs next week as well as trim bond-buying to end the program six weeks earlier than expected, Deutsche Bank says. Changing its previous call, the German bank now expects rate-setters to lift the base rate to 0.25% from 0.1% in a 6-3 vote on Nov. 4. and to cut short quantitative easing. "We now see the Monetary Policy Committee ending its QE at the November meeting - cutting roughly GBP 20bn from its QE envelope," says DB's Sanjay Raja. The BOE's GBP150 bond-buying program is currently due to finish in December, bringing the central bank's target stock of asset purchases to GBP895 billion, including GBP20 billion in corporate bonds.

---

UK Government Plans for Sewage Overflows Could Benefit United Utilities

0912 GMT - The U.K. government's plan to introduce a duty to improve the quality of sewage discharges from storm overflows could be a medium-term opportunity for United Utilities to accelerate growth, HSBC analyst Verity Mitchell says. United Utilities has by far the largest number of overflows in the U.K., she notes. "Might this be an opportunity for UU to invest to reduce the sheer numbers of events? With increased public and political scrutiny, this could provide more asset growth to effect environmental improvements," Mitchell says. HSBC upgrades the water utility company to hold from reduce, and raises the target price to 1,090 pence from 970 pence.

---

Computacenter's 3Q Update Looks Positive on Market Demand

0900 GMT - Computacenter's 3Q update maintains a positive tone on market demand, with year-on-year growth marginally above expectations, Goodbody says. The British information-technology group's backlog for technology sourcing is at record levels, and while the read-through for the company is indirect given its emphasis on systems integration rather than distribution, it does provide a marker on the relative demand for technology--albeit one with a bias toward commercial, rather than consumer demand, the Irish brokerage says. "For the year to March, we forecast 3.3% year-on-year growth in revenue and 6.2% in Ebita for Exertis, the technology division of Computacenter, accounting for 13% of group Ebita," Goodbody says. Goodbody maintains its buy recommendation. Shares are down 2.3% at 2,690 pence.

---

NatWest's 3Q Contracted Net Interest Margin Likely to Get Investors' Attention

0752 GMT - Investors' focus in relation to NatWest Group's third-quarter results will likely be its on-quarter net interest margin contraction, Jefferies says. The FTSE 100-listed bank is a rate-sensitive lender, with a common equity Tier 1 ratio--a key measure of balance-sheet strength--of 18.7%, Jefferies says, noting that the bank has an endowment problem of having too much capital. "The investment case therefore relies on repatriating this capital and the bank realizing higher net interest income via rates," Jefferies says. Shares are down 5.4% at 219.00 pence.

---

NatWest's Share Price Falls Despite Stronger-Than-Expected Profits

0747 GMT - The market reaction to NatWest's results for 3Q has been a little underwhelming, with the shares dropping to the bottom of the FTSE 100 index, Michael Hewson, chief market analyst at CMC Markets UK, says. The lender's pretax profit, net profit and revenue came in ahead of market expectations, but net profit was still almost half the level it reached in 2Q, Hewson says. "Having seen decent numbers from Lloyds and Barclays, expectations were high for NatWest Group's third-quarter numbers today," Hewson says. The fact that the bank booked a charge of GBP294 million after pleading guilty to money-laundering charges didn't help to boost sentiment, he says. Shares are down 5.4% at 219.00 pence.

---

Glencore's 2021 Marketing Guidance Upgrade Was Expected by the Market

0700 GMT - Glencore said it expects adjusted EBIT from its marketing business to exceed the top end of the $2.2 billion-$3.2 billion long-term guidance range in 2021. This is positive, but also expected following a strong performance in the first half and as commodity markets remained tight in the second half, RBC Capital Markets says. The market consensus for Glencore's 2021 marketing EBIT is $3.5 billion, RBC notes. As for production, third-quarter figures were slightly weaker, but annual guidance ranges have been reaffirmed, the bank says. The most notable miss was nickel, which was 18% below RBC's forecasts. "We continue to see Glencore in a favorable position versus peers."

Contact: London NewsPlus, Dow Jones Newswires; Write to Sarka Halas at sarka.halas@wsj.com

(END) Dow Jones Newswires

10-29-21 0600ET