BRITAIN'S four biggest banks are on track to report annual profits 14 per cent higher than last year, when they made a record-breaking £45.9 billion, new analysis shows.

Today, Natwest Group revealed a surprise pre-tax profit of £1.8bn in the first quarter of the year, 36 per cent higher than the same period last year.

Following results from HSBC, Barclays and Lloyds Bank earlier this week, research and campaign group Positive Money calculated that this puts their combined pre-tax profits at £136.8bn since the Bank of England began raising the base interest rate in December 2021.

Positive Money says that while the current rate remains 4.5 per cent, banks stand to have made £150bn from the government by 2030.

This is because the government covers both the losses the Bank of England is making from paying banks a higher rate of interest on their risk-free central bank reserves, and from simultaneously selling off government bonds, according to the group.

This amounts to roughly £30bn a year in transfers from the Treasury to the Bank of England to the banks over the next five years.

The analysis also shows that the “big four” banks have spent 34 per cent of the £124bn they made between 2022 and 2024 on payouts to shareholders via dividends, and a further 26 per cent through share buybacks that often benefit from more generous tax treatment.

Positive Money’s Ellie McLaughlin said: “Austerity measures or watering down regulation should absolutely not be on the cards in this context — and if the Treasury refuses to stop footing the bill for Bank of England losses, then it should tax back some of these windfall profits.”