Tuesday, August 3, 1999 Published at 08:19 GMT 09:19 UK
Business: The Company File
Bank profits continue to rise
NatWest Bank has become the latest to report a sharp rise in profit.
The UK's National Westminster Bank has reported an 18% rise in pre-tax profits for the first half of 1999.
The High Street bank reported profits of £1.14bn ($1.84 billion), as it continued a strong set of results from UK banking groups.
The NatWest figures were ahead of market forecasts of about £1bn.
It also followed other UK financial groups in pledging investment in Internet banking operations.
NatWest chairman David Rowland said: "We are investing significantly across the group. The programme to transform the retail bank is now well on the way to delivering improved services at a lower unit cost."
The UK banking business contributed £665m towards the bank's first half profits, the Treasury, or global financial markets business, brought in £205m, and Greenwich NatWest contributed nearly £100m of profits.
It has used £521m to buy back shares between mid-April and mid-June, and said the rolling share buy-back programme would continue in the second half.
NatWest managed to fight off most of the effects of intense competition for consumer credit, home mortgages and retail deposits, buy cutting its rates relative to its competitors.
The bank said it plans to become a leader in e-commerce, where it has already made strides in credit card lending on-line.
"We recognise that our industry is going through a period of great change as a result of the combined impact of e-commerce, increased competition, new regulation and the globalisation of markets," the bank's chief executive Derek Wanless said in a statement.
"Our investment in payment systems and new technology channels for our products and services will position us at the forefront of e-commerce in the financial services industry," he added.
Norwich profits up
Meanwhile UK insurer Norwich Union reported a 5% increase in first half operating earnings before tax to £380m ($613.8 million). New life and pensions profits rose more than 30%.
Analysts had forecast operating earnings before tax of about £375m.
Norwich Union said new UK long term savings business, including life and pensions business, rose 40% to £181m.
It said UK margins had been maintained at just under 30%, sustaining growth in volume and profitability.
Norwich said the 5% growth in operating earnings had been suppressed by investment in strategic business initiatives and a lower long term investment outlook.
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