Bad debts bring NAB full-year profit down
(1 November 2012 – Australia) National Australia Bank (NAB) reported its full-year net profit was at A$4.08 billion – down 22 percent due to large costs from its troubled Britain operations.
The result marks the first time since 2009 that NAB has not reported improved profits.
NAB had suggested earlier this month that its annual profit would be largely in line with the previous year, but admitted on Wednesday that bad debt provisions had risen 44 percent to A$2.6 billion, hurt by its struggling British operations and the cooling Australian economy.
NAB’s net profit fell from last year’s A$5.22 billion full-year result.
The bank’s full-year cash profit, which excludes one-off financial items, was A$5.43 billion, down slightly from A$5.46 billion in the previous year, ending two years of record profits.
The result for the year to September 30 included a A$250 million provision for bad debts at its British banks, plus impairment and restructuring costs.
Chief executive Cameron Clyne said the bank has a slightly worse outlook for bad debt charges for 2013.
Clyne said economic conditions in Australia would be challenging in fiscal 2013, with consumer sentiment low and business conditions weak.
He said NAB’s Australian and New Zealand businesses posted improved performances in the year to September, but that was overshadowed by the problems in Britain.
NAB has owned the Clydesdale and Yorkshire banks since 1987.
Clyne said NAB would not be conducting a fire sale of its British banks, adding that all efforts had been made to simplify its business there.
But conditions in Britain remain challenging, with the economic recovery proving to be slower than the recovery from the Great Depression, he said.
The bank cut staff numbers by 1309 in the year to September, to 43,336.
NAB had suggested earlier this month that its annual profit would be largely in line with the previous year, but admitted on Wednesday that bad debt provisions had risen 44 percent to A$2.6 billion, hurt by its struggling British operations and the cooling Australian economy.
NAB’s net profit fell from last year’s A$5.22 billion full-year result.
The bank’s full-year cash profit, which excludes one-off financial items, was A$5.43 billion, down slightly from A$5.46 billion in the previous year, ending two years of record profits.
The result for the year to September 30 included a A$250 million provision for bad debts at its British banks, plus impairment and restructuring costs.
Chief executive Cameron Clyne said the bank has a slightly worse outlook for bad debt charges for 2013.
Clyne said economic conditions in Australia would be challenging in fiscal 2013, with consumer sentiment low and business conditions weak.
He said NAB’s Australian and New Zealand businesses posted improved performances in the year to September, but that was overshadowed by the problems in Britain.
NAB has owned the Clydesdale and Yorkshire banks since 1987.
Clyne said NAB would not be conducting a fire sale of its British banks, adding that all efforts had been made to simplify its business there.
But conditions in Britain remain challenging, with the economic recovery proving to be slower than the recovery from the Great Depression, he said.
The bank cut staff numbers by 1309 in the year to September, to 43,336.
Subscribe