NAB caution dents hopes of cash return for its investors
NATIONAL AUSTRALIA BANK (NAB), which owns Clydesdale and Yorkshire banks, dampened hopes that the nation’s lenders will return surplus capital to investors anytime soon yesterday.
It said it needed a cash buffer to protect it against economic headwinds and bad debt charges.
The cautious outlook from Australia’s largest bank showed it will be a while before the trickle down effects of a recovering economy are felt.
The comments overshadowed NAB’s better-than-expected second-half cash profit, which rose to A$1.81bn (£980m) for the six months to end-September from A$1.68bn a year earlier.
The bank gave no earnings guidance for the current fiscal year, but said it would focus on cutting costs.
NAB has spent over A$1bn in the past year to beef up its wealth management, insurance and mortgage businesses.
The group’s chief executive Cameron Clyne said the bank continues to look at acquisition opportunities.
Bad-debt charges at NAB, which makes the bulk of its income from the home market, rose 14 per cent to A$2bn for the second half from A$1.76bn a year earlier.