Yahoo Finance NatWest chair apologises for money laundering failures and warns on inflation
The chairman of NatWest bank has apologised to shareholders for failing to prevent money laundering at the group between 2012 and 2016.
He also warned that inflation looks set to rise, with the war in Ukraine likely to impact energy and food bills further.
NatWest was fined £264 million after pleading guilty last year over breaches of anti-money laundering regulations.
Howard Davies told shareholders at the bank’s annual meeting: “NatWest Group takes its responsibility to prevent and detect financial crime extremely seriously.
“We deeply regret that we failed adequately to monitor one of our customers between 2012 and 2016 to prevent money laundering.
“And while the case has now come to an end, we continue to invest significant resources in the ongoing fight against financial crime and fraud.”
His apology comes as the chairman warned the upcoming year would be difficult for customers with the cost-of-living crisis.
He said: “Inflation, which was already on a steep trajectory at the end of 2021, looks set to continue to rise as the reverberations from the invasion of Ukraine have a direct impact on prices – especially of energy and commodities.
“We are very conscious of the effects this will have on the increased cost of living for many of our customers, and we are committed to helping them where we can.”
Updating shareholders, which includes the UK Government with a stake of 48%, chief executive Alison Rose said it was supporting humanitarian efforts in Ukraine with £2.5 million in donations from the bank.
She added that support is being given to help refugees open bank accounts in the UK and the boss recently visited NatWest’s operations in Poland to see efforts in the country.
Ms Rose also warned on rising inflation and said the bank was increasing efforts to support UK families and businesses.
She said: “We are not seeing any significant signs of financial distress in our book at this stage. We are, however, very aware of the challenges and concerns the cost-of-living crisis is causing for many of our customers up and down the country.
“Therefore, in line with our approach throughout the pandemic, we are focussed on providing the practical help and support that people, families and businesses need to thrive.”
The boss explained this would include financial health checks and support for small and medium-sized businesses to manage their finances.
Prior to voting on resolutions, there were several questions from investors, including comments regarding plans for share-buybacks, how quickly higher interest rates would be passed on to customers and ethnicity pay gaps.
Shareholders voted in favour of all resolutions put forward at the annual general meeting, although the re-election of Frank Dangeard, NatWest Market’s chairman, received only 56%.
Investors are said to be unhappy with the large portfolio of boards Mr Dangeard now sits on.
A resolution asking shareholders to back a climate strategy, which NatWest said would help it align with the 2015 Paris Agreement, was also passed.
Under the new strategy, NatWest will publish a transition plan, and will try to halve the climate impact of the things it finances before the end of this decade.
Last November the bank stopped lending to new coal projects around the world, but said it would continue to work with oil and gas companies, as long as they had plans to transition their business.
The environment has been a key focus of Alison Rose since she took the reins at the bank in 2019.
The meeting comes a day before NatWest will unveil its interim results, with analysts predicting pre-tax operating profits as set to slide 20% to £755 million.
