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State lender Natwest reported a sharp rise in profits as it followed rivals to recoup some of the money set aside to cover bad loans.

The bank, which remains 60% taxpayer-owned, said pre-tax operating profit rose 82% to £ 946m for the first quarter, in part thanks to a release of funds of £ 102m of pounds sterling.

Natwest said the government’s ongoing COVID support programs were preventing corporate borrowers from defaulting on their loans.

Managing Director Alison Rose said there were “reasons for optimism” as the UK’s immunization program progresses and restrictions are relaxed and its loan portfolio has performed better than expected during the period.

“However, uncertainty persists for our economy and for many of our customers due to COVID-19,” she added.

Natwest – previously known as the Royal Bank of Scotland – is following rivals HSBC and Lloyds Banking Group this week to recoup some of the billions they have set aside for deteriorating loans due to the pandemic.

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