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Coutts, Adam & Co Largely Shrug Off Pandemic Woes

Tom Burroughes, Group Editor , London, 3 August 2020

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Assets under management rose from a year earlier; total income held steady over a year ago. The cost/income ratio widened and there was a rise in impairments. Overall, the private banking arm of NatWest managed to ride out the market storms relatively well, its CEO said.

Coutts and Adam & Co, the private banking businesses of NatWest – previously known as Royal Bank of Scotland – logged a 33 per cent jump in gross inflows in the first six months of this year from a year earlier, at £1.6 billion ($2.1 billion).

Assets under management rose to £27.1 billion at the end of June this year, against £23.2 billion a year before, NatWest said in a statement last Friday. Total assets under management and administration stood at £29.8 billion, slipping from £30.4 billion a year earlier. 

Total income rose to £191 million at end-June, unchanged from a year earlier but dipping from £201 million at 31 March, it said. Operating costs rose to £129 million from £115 million a year earlier. Impairment losses were £27 million in Q2, up from £1.0 million a year before. 

The private banking arm’s cost/income ratio widened to 67.5 per cent at end-June from 60.2 per cent a year before. 

“For our investment inflows to have improved year-on-year and to have achieved this level of client growth in such a volatile and unprecedented environment, is most gratifying,” Peter Flavel, CEO Private Banking at NatWest, said. 

“Despite the challenging circumstances brought about by the pandemic, I am also most encouraged to report we onboarded more than 1,500 new Clients in H1 2020,” he said.

More than 40 per cent of the new clients were taken on board in the second quarter of this year.

“There is no doubt, however, that COVID-19 has had a significant impact on all financial services businesses, both directly and through its effect on financial markets,” he added, noting the impairment charge for the quarter.

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