By Steve Goldstein
NatWest was the worst-performing U.K. blue chip on Friday as investors focused on falling net interest margin even as profitability surged.
Falling back from 20-month highs, NatWest /zigman2/quotes/209265718/delayed UK:NWG +1.18% /zigman2/quotes/203233010/composite NWG +0.52% fell 4% as it said its third-quarter profit jumped to £674 million from £61 million, helped a £242 million impairment release as well as a 14% rise in income.
But its net interest margin, excluding the markets division, fell to 1.54% from 1.65%.
Russ Mould, investment director at AJ Bell, said NatWest shares are trading at one of their lowest discounts to their tangible net asset value in some time. “This perhaps explains why investors are being a little less forgiving when they study the third-quarter results,” he said.
The broader FTSE 100 /zigman2/quotes/210598409/delayed UK:UKX +0.05% eased 0.3% in midday trade, though it’s up over 1% on the last week and 4% on the month.