NatWest, opens new tab reported a 12% rise in first-quarter profit, as the bank grew lending income while taking a modest charge for potential losses from the impact of the Iran war even as it warned that Britain’s economic outlook has ​darkened.

Operating profit before tax for January-March rose to 2 billion pounds ($2.7 billion), up from 1.8 billion ​pounds in the same period a year ago and just above the 1.9 billion ⁠pounds average forecast by analysts.

The earnings showed NatWest, opens new tab, so far ​sustaining a recent robust run of profitability despite concerns about sluggish economic growth and the fallout from the ​Middle East conflict.

NatWest also upgraded its income guidance for the year, saying it now expects it to be near the top of its previously stated 17.2-17.6 billion pound range, even as it cut some of its forecasts for Britain’s economy, suggesting tougher ​times ahead.

“We are confident we will achieve our guidance. However, we recognise that market conditions are uncertain ​and we will refine our internal forecasts as the economic position evolves,” CEO Paul Thwaite said in the earnings statement.

NatWest shares, ‌which ⁠have risen 19% in the last year, slipped 3% in early trading, as investors took in the more bearish economic outlook as well as non-interest income which came in 7% below analysts’ forecasts.