(4 August 2025 – Australia) National Australia Bank posted its highest-ever month of business lending in June as the new boss of the division, Andrew Auerbach, fends off competition from Commonwealth Bank.
In the intensely competitive business lending space, NAB has restored its market share to the highest level in 12 months, following an aggressive push into the market by CBA business banking head Mike Vacy-Lyle, according to data released by the Australian Prudential Regulation Authority on Thursday.
NAB wrote $4.5 billion of new loans in June, at an average of $225 million each weekday, surpassing the previous highest month, June 2021.
It also recorded solid business lending growth in May after stuttering in the first few months of the year.
Growth in June was strongest in the agriculture, construction, commercial real estate and accommodation sectors, and from small and medium-sized businesses, the bank said.
A former colleague of NAB chief executive Andrew Irvine at the Bank of Montreal in Canada, Auerbach started in the role on June 16.
NAB’s market share in business lending has risen to 21.7 per cent at the end of June, up from 21.3 per cent at the start of the calendar year. Its gains have been the strongest of the big four banks over the past three months, but it has lost ground to CBA and Westpac over the past year.
Westpac has hired a new head of business banking, Paul Fowler, who took the reins in May after arriving from CBA. Westpac has also grown business lending at a faster rate than the average of the market over the past three months.
“Business banking, in our view, remains a growth vector for the Australian banking sector, and NAB is well-placed to benefit from this despite recent market share losses,” said UBS analyst John Storey on Thursday. “Digital lending should drive improved efficiency and client outcomes.”
During a briefing with analysts and investors on Wednesday, which he dialled in to from Darwin, where he was visiting clients, Auerbach said NAB was in a strong position to accelerate its strategy. It planned to make more automated lending decisions using a new technology platform.
But he also emphasised the importance of long-term, personal client relationships. At the Bank of Montreal, he encouraged staff to “work across teams rather than in silos”, he said, and pushed management to “take work away from our bankers, to make it simpler for them to look after their customers”.
NAB has a “strong pipeline of lending opportunities that we’re seeing pull through over the past few months,” he said. “We’re focused on continuing to build on this momentum and deliver for our customers.”
NAB will issue a third-quarter trading update on August 18. Analysts are cautious after a tough period for the bank, which included chief financial officer Nathan Goonan announcing his departure to Westpac and some investors raising concerns about Irvine’s leadership style.
One investor, who attended the briefing this week, said the market would need more time to assess Auerbach.
“It is early days, and he is still getting his head around the business and seeing customers,” the fund manager said. “He laid out his credentials and working history, which were pretty dry. There was not a lot to go on.”
Analysts expect NAB to report a 4 per cent drop in cash profit for the third quarter compared to its quarterly average over the first half. Its margin is expected to be slightly down and revenue flat.
“We think non-performing loans and the loan loss charge will rise in the third quarter, and commentary will remain measured,” Morgan Stanley analyst Richard Wiles said. “However, we don’t think there will be any significant adverse surprises on credit quality.”