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how much profit do banks make on a mortgage?

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  • Salemicus
    Salemicus Posts: 343 Forumite
    Sixth Anniversary 100 Posts Name Dropper Combo Breaker
    What you appear to be talking about is the net interest margin (or perhaps related concepts like the spread). It depends from bank to bank, but for example Natwest's NIM was 1.67% in their latest accounts.

    But you misunderstand what profit is. As @eddddy implies, it's a residual, which you only get to judge after the event. For instance, is the borrower going to repay the loan? Not necessarily! That's why those same latest accounts have Natwest losing £770m in the first half of the year - basically they are predicting that, due to the pandemic, a whole bunch more people won't be able to pay back their loans and Natwest won't be able to recover the money.
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