NAB Flags $755m Of Restructuring Costs
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Three major banks - the ANZ, NAB and Westpac - report their 2017-18 interims from May 1 (today week).
The National Australia Bank has confirmed it will report $755 million of pre-tax restructuring costs which will be close to the upper end of its first-half guidance.
The NAB said more details on just where the costs were incurred will be reported with the profit result next week.
NAB previously outlined a cost of between $500 million and $800 million, largely related to redundancies.
The after tax impact will be $530 million, the NAB told the ASX on Friday.
There was no estimate of any costs flowing from the banking Royal Commission. it is expected they start being revealed later in the year.
Some analysts believe the NAB and other banks will have to employ more people in compliance and regulatory areas as a result of the problems exposed in the Commission.
The bank revealed last November announced it will eliminate a net 4,000 jobs over the next three years as it simplifies its business and increases its use of digital and automated banking products.
NAB will halve the number of products it sells and retire between 15 and 20% of its IT applications.
It previously said the restructure will eliminate 6,000 jobs, although some staff will be retrained and rehired in 2,000 new roles as the bank tries to reduce regulatory risks and improve customer experience through new technology.
The company has also said there would be no cut to its dividend for at least the current financial year.
The impact on NAB’s cash earnings will be revealed when it releases its first-half results on May 3.
NAB shares rose 1.4% to $28.76.
Glenn Dyer has been a finance journalist and TV producer for more than 40 years. He has worked at Maxwell Newton Publications, Queensland Newspapers, AAP, The Australian Financial Review, The Nine Network and Crikey.
At the AFR he was a finance writer, Finance Editor, News Editor and Chief of Staff. At the Nine Network he was supervising producer of Business Sunday for more than 16 years. He has also written for other online and analogue print publications here and overseas.