A busy results announcement from the NAB this morning – cash earnings up 2.4% to $5.84 billion, while the final dividend was an unchanged 99 cents, making a total for the year of $1.98 a share, as foreshadowed earlier this year. Statutory profit was $6.34 billion.
Excluding one offs, cash earnings were up more than 15%.
And the bank confirmed that it was selling 80% of its weakly performing insurance arm to Nippon Insurance of Japan for $2.4 billion, and it is also now planning to sell off its UK banking operations (Clydesdale) in a market float next February.
Strict comparisons of profit for 2014-15 compared to the previous year was made harder by the clean up of the UK business and asset sales much of which were announced earlier this year with the $5.5 billion capital raising and refinancing of the troubled UK banking operations centred on Clydesdale bank.
NAB said earnings from its Australian bank rose 3% to $5.1 billion on higher revenue and lower bad debt charges. Total revenue rose 4% on a stronger performance from markets and treasury and higher housing and business lending.
NAB’s net interest margin contracted by 3 basis points, which NAB said was due to lending competition in Australia.
For all the early hype this morning which concentrated on the double digit rises (including the one offs), the true reflection of the underlying result can be found by eliminating one offs items. On that basis it was a solid result and one the unchanged dividend confirms.
