Outlook
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We will now target a return on average tangible equity ('RoTE'), excluding the impact of notable items, in the mid-teens for both 2024 and 2025.
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Based upon our current forecasts, we expect banking NII of around $43bn in 2024. This guidance remains dependent on the path of interest rates globally.
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While loan growth was 1% in 1H24, revenue has continued to benefit from elevated interest rates. Over the medium to long term, we continue to expect mid-single digit year-on-year percentage growth in customer lending.
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We are reiterating our cost growth guidance of approximately 5% for 2024 compared with 2023, on a target basis, and now expect ECL charges as a percentage of average gross loans in 2024 to be within our medium-term planning range of 30bps to 40bps (including customer lending balances transferred to held for sale).
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Our guidance reflects our current outlook for the global macroeconomic environment, including customer and financial markets activity. This includes our modelling of a number of market dependent factors, such as market-implied interest rates (as of mid-July 2024), as well as customer behaviour and activity levels.
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We intend to manage our CET1 capital ratio within our medium-term target range of 14% to 14.5%, with a dividend payout ratio target basis of 50% for 2024, which excludes material notable items and related impacts.
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Note: we do not reconcile our forward guidance on RoTE excluding notable items, target basis operating expenses, dividend payout ratio target basis or banking NII to their equivalent reported measures.