Citi sees NatWest, HSBC topping estimates as UK bank results loom

Citi says it remains constructive on UK banks and expects near-term pressure on net interest income (NII) in Q1 2026 from lower day counts and mortgage margin compression, with growth resuming from 2Q26. Ahead of Q1 results (Apr 28–May 5), Citi forecasts adjusted pre-tax results above consensus for NatWest, Barclays and HSBC — with NatWest seen ~7% above, Barclays ~6% above and HSBC ~3% above consensus — while Lloyds is a touch below. Citi forecasts full‑year 2026 NII growth of 13% at NatWest, 7% at Barclays and 8% at Lloyds, and remains most constructive on NatWest and HSBC (both rated buy). The broker’s outlook and above‑consensus profit forecasts could support UK bank stocks and the UK 100 index on results beats, although Q1 mortgage margin pressure and lower deposit spreads are flagged as near‑term risks.