NatWest Group is the latest banking giant to confirm that it has set aside billions of pounds in case more people and firms default on loans because of the COVID-19 pandemic.
The group revealed the figure as it reported a £770m loss for the first half of 2020. Last year it made a £2.7bn profit.
Alison Rose, NatWest Group Chief Executive, said: “Our performance in the first half of the year has been significantly impacted by the challenges and uncertainty our economy continues to face as a result of COVID-19.
“However, NatWest Group has a robust capital position, underpinned by a resilient, capital generative and well diversified business.
“Through our strong balance sheet and prudent approach to risk, we are well placed not only to withstand COVID-19 related impacts but also to provide the right support to those who will need it most in the tough times to come.”
NatWest has now made provision of nearly £2.9bn against non-repayment of loans. It said that it expected to set aside between £3.5bn and £4.5bn for the whole of 2020 to deal with the economic consequences of the pandemic.
Earlier, fellow banking giant Lloyds said it was increasing its provision by another £2.4bn. meaning it has now built up a total of £3.8bn for bad loans.
Prior to that, banking group Barclays said it had set aside £1.6bn in the second quarter of the year to cover the cost of non-repayment of loans. That took its total provisions for bad loans to £3.7bn for the first half of the year.