NatWest share price outlook amid the Nigel Farage Coutts account crisis

July 21, 2023 12:00 PM AEST | By Invezz

Nigel Farage Coutts account

The biggest banking news in the UK this week was on the closure of Nigel Farage’s bank accounts by Coutts. Coutts is a Natwest subsidiary that focuses on highly affluent people and companies in the UK.

Nigel Farage, a controversial figure in British politics, published documents that revealed the bank considered his political views when closing his accounts. That move has been criticised by UK politicians from both sides of the aisle.

Investors have also questioned the viability of the bank’s CEO Alison Rose, with some calling for her resignation. In a letter to Farage on Thursday, she apologised and promised to conduct a review of the processes. She said:

“I believe very strongly that freedom of expression and access to banking are fundamental to our society. I fully understand yours and the public’s concern that the processes for bank account closure are not sufficiently transparent.”

Dame Alison Rose’s apology is a start, but it is no more than that.

She needs to take responsibility as CEO, and is wrong to say the views of her own committee’s report don’t reflect the bank.

I will now defend thousands of other people that have been de-banked on her watch.
— Nigel Farage (@Nigel_Farage) July 20, 2023

The Nigel Farage issue has affected NatWest’s public image. However, its impact on the bank’s performance will be limited. For one, Coutts is a small part of the broader Natwest Group. Its 2022 revenue came in at about 1 billion pounds compared to NatWest’s 15.7 billion pounds. Also, I don’t expect Coutts and Natwest to lose customers because of this crisis.

The next important catalyst for the NatWest share price will be the company’s Q2 earnings scheduled for next Friday. Analysts expect that the company’s total income will be 3.7 billion pounds. Its profit for the period is expected to come in at 1 billion pounds while net interest income will be 817 million.

Natwest share price forecast

The 4H chart shows that the NatWest stock price has been in a bullish trend this month. This rally happened as investors reacted to the strong earnings of American banks like JP Morgan and Morgan Stanley.

NatWest shares flipped the resistance at 250p (May 4 low) into a support level. The 50-period and 25-period moving averages have made a bullish crossover pattern. It has now formed a bearish engulfing pattern. Therefore, I suspect that it will retest the support at 250p ahead of its next week’s earnings.

The post NatWest share price outlook amid the Nigel Farage Coutts account crisis appeared first on Invezz.

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