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NatWest Group vs Barclays

Side-by-side credit pricing comparison from Pillar 3 disclosures.

Last updated: March 2026 · Data source: public Pillar 3 disclosures
Verdict:

On a representative BBB+ EUR 25M 5-year term loan, Barclays is the cheaper lender by 9bp in minimum spread. For a EUR 25M facility, that's EUR 22,304 per year.

Bank profiles compared

Metric NatWest Group
United Kingdom		 Barclays
United Kingdom
IRB approachA-IRBMixed
Cost-to-income48.6%62.0%
Effective tax rate24.3%21.6%
Avg corporate PD1.20%2.90%
Avg LGD unsecured37.0%39.4%
Avg LGD secured20.0%20.0%
Funding spread (bp)15bp15bp
Corporate EADEUR 109bnEUR 78bn

Sample RAROC: BBB+ EUR 25M 5Y term loan

Both banks priced on the exact same deal — 150bp spread, 20bp commitment fee, 60-month maturity. Higher RAROC means the bank earns more from this deal. Lower min-spread means the borrower gets a better rate.

Component NatWest Group Barclays
Annual revenueEUR 385,000EUR 385,000
Operating costEUR 154,000EUR 154,000
Expected lossEUR 28,750EUR 28,750
Capital required (FPE)EUR 2,451,320EUR 2,451,320
RAROC (after tax)7.37%7.64%
Min spread for 12% RAROC250bp241bp
This is just one sample deal.

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FAQ: NatWest Group vs Barclays

Which bank is cheaper on corporate credit: NatWest Group or Barclays?
On a BBB+ EUR 25M 5-year term loan, Barclays requires a minimum spread of 241bp to reach a 12% RAROC hurdle, versus 250bp at the other bank — a difference of 9bp on the same deal.
How do NatWest Group and Barclays compare on corporate PD?
NatWest Group reports an EAD-weighted corporate PD of 1.20%, while Barclays reports 2.90%. The gap reflects differences in obligor mix and geography rather than underwriting quality.
How do the two banks differ on IRB approach?
NatWest Group uses A-IRB and Barclays uses Mixed. The IRB approach determines whether internal LGD models or supervisory LGDs apply, which materially affects capital required on every corporate facility.
What deal is used in this comparison?
A single standardised facility: BBB+ rated, EUR 25M drawn on a EUR 30M commitment, 5-year tenor, 150bp spread, 20bp commitment fee. Both banks are priced on this exact deal using their own disclosed Pillar 3 parameters.