NAB recovery half way there
(10 November 2005 – Australia) National Australia Bank group chief executive, John Stewart, said the full year result indicated the bank would meet the three year turnaround target it set itself some 18 months ago.
The bank posted a A$4.13 billion annual net profit but saw its cash earnings fall by 4.4 percent to A$3.31 billion although it rebounded in the second half of the year, growing 4.6 percent.
"The full year results show the turnaround is on track but we still have much work to do," Stewart said.
"The National’s earnings growth is acceptable for where we are in the turnaround. I am pleased we have won market share at acceptable margins while maintaining asset quality," he said.
The bank’s operating expenses grew 7.2 percent to A$7.30 billion from A$6.81 billion a year earlier.
"Cost growth reflects a combination of compliance programs, rectifying customer issues and investment in brand recognition," Stewart said.
Significant items for the year were the sale of NAB’s Irish banks for a profit of A$1.04 billion, an offsetting restructuring charge of A$606 million, and provision for the settlement of a tax dispute for A$97 million.
Stewart said the bank’s Australian business was gaining momentum with lines of business being given greater accountability for products and functions and that support functions had been streamlined.
He said the bank had gained market share in home and business lending and launched a range of new products.
"This volume increase coupled with careful margin management has driven healthy half year banking income growth of 6.1 percent. Asset quality remained strong across the entire portfolio," Stewart said.
NAB said its UK business had stabilised profits despite restructuring the business and managing down margins.
Cash earnings for the New Zealand business grew 7.8 percent on the back of strong performances in home lending, agribusiness and retail deposits.
"The full year results show the turnaround is on track but we still have much work to do," Stewart said.
"The National’s earnings growth is acceptable for where we are in the turnaround. I am pleased we have won market share at acceptable margins while maintaining asset quality," he said.
The bank’s operating expenses grew 7.2 percent to A$7.30 billion from A$6.81 billion a year earlier.
"Cost growth reflects a combination of compliance programs, rectifying customer issues and investment in brand recognition," Stewart said.
Significant items for the year were the sale of NAB’s Irish banks for a profit of A$1.04 billion, an offsetting restructuring charge of A$606 million, and provision for the settlement of a tax dispute for A$97 million.
Stewart said the bank’s Australian business was gaining momentum with lines of business being given greater accountability for products and functions and that support functions had been streamlined.
He said the bank had gained market share in home and business lending and launched a range of new products.
"This volume increase coupled with careful margin management has driven healthy half year banking income growth of 6.1 percent. Asset quality remained strong across the entire portfolio," Stewart said.
NAB said its UK business had stabilised profits despite restructuring the business and managing down margins.
Cash earnings for the New Zealand business grew 7.8 percent on the back of strong performances in home lending, agribusiness and retail deposits.
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