At the end of a week in which chief executive, Dame Alison, was forced to quit for her own role in the saga, Sir Howard Davies suggested an earlier succession plan for his own future remained unchanged.

He was speaking hours after the bank revealed £3.6bn in pre-tax profits during the first half of the year - up from the £2.6bn achieved in the same period in 2022 as its bottom line was boosted by rising interest rates.

It made a further provision of more than £220m for bad loans in the tough economy but said it was currently seeing a low level of arrears and defaults due to higher mortgage and other borrowing costs.

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NatWest updated on its progress following two days of hits to its share price, resulting in £1bn of market value being lost - a reaction to its leadership being left in tatters over the Farage fallout.

Dame Alison stood down after admitting she had been the source of an inaccurate story in the media over the reason why the Brexit politician's account with Coutts, a division of NatWest, had been closed down.

Coutts chief executive Peter Flavel followed her out of the door on Thursday.

Mr Farage has demanded the resignation of the entire group board, including Sir Howard, who had initially backed Dame Alison's position before an apparent change of heart amid government anger.

Sir Howard said on Friday in a call with journalists that the "political reaction to retaining Alison Rose as chief executive was such that her position was untenable".

The chairman confirmed his intention to remain in post as planned until next year, when a process to identify a successor that began in April is due to conclude.

He insisted that the group did not shut down accounts "on the basis of people's legally held political views" but would not comment on whether Mr Farage's account with Coutts would be reactivated.

A City law firm, he added, had been appointed to examine its handling of the Farage case as the banking sector faces scrutiny on the de-banking issue.

Lenders have been dragged this week into the Treasury, with regulators also applying pressure on the sector to ensure that anyone has access to banking regardless of their political background or perceived beliefs.

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The row has overshadowed the banking results season with NatWest's figures for the first half of 2023, like rivals Lloyds and Barclays so far, showing the benefits of rising interest rates as the Bank of England continues its campaign against inflation.

Financial analysts had expected profits closer to £3.3bn for the period for the bank, which announced an interim dividend of 5.5p per share and a share buyback of up to £500m for the current second half of the year.

The net interest margin - a key indicator for financial analysts that shows the spread between what the bank charges borrowers and pays to depositors - stood at 3.2%.

That was up from the 2.6% achieved in the same period a year ago but was lower in the second quarter - mirroring Lloyds - as banks came under political pressure to pass on better rates to savers.

Sky's business presenter Ian King said Dame Alison's stewardship of the bank's financial performance was evident in the figures - especially in its growth of market share for mortgages.

"This really is a bank that was doing very, very well indeed under Alison Rose, " he said.

She is set to be officially replaced, on an interim basis, by Paul Thwaite who had headed the group's commercial and institutional banking division.

Chief financial officer, Katie Murray, said of the results: "NatWest Group's strong performance for the first half of the year is underpinned by our robust balance sheet, with a high-quality deposit base, high levels of liquidity and a well-diversified loan book.

"As a result, we are able to continue lending to our customers and delivering sustainable returns and distributions to our shareholders, even in the current uncertain economic environment."

Although arrears remain low, we know that people, families and businesses are anxious about their finances and many are really struggling.

"We are being proactive in our support for those who are hardest hit, helping to build the financial resilience of the
customers and communities we serve."

Shares, down 10% over the year to date ahead of Friday's open, were down fractionally in early trading but later turned positive and were up by almost 3%.

Analysts had pointed to disappointment that the net interest margin was not higher for the early decline.

Matt Britzman, equity analyst at Hargreaves Lansdown, added: "Perhaps more importantly, full-year guidance has been dragged lower reflecting the ongoing deposit shift to accounts that offer better rates as consumers do all they can to make cash savings go further."