NAB has joined Westpac and the ANZ in returning to paying an interim dividend after reporting a solid rebound in earnings for the six months to March 31.
NAB set its interim payout at 60 cents a share, double the payout a year ago.
The interim is as much as NAB was allowed to pay for all of 201920 because APRA, the key bank regular, put restrictions on the size of the payouts to force banks to conserve cash and capital in the pandemic.
The bank told the ASX in an early Thursday filing that it earned a first half cash profit of $3.34 billion, just topping market estimates for a $3.27 billion result. Statutory profit was $3.208 billion.
Revenue rose 1% to $8.439 billion for the half.
That was 94.8% ahead of its cash profit in the first half of the 2020 financial year thanks when the bank boosted its loan loss provisions and write downs ahead of what was expected to be a surge in defaults in home mortgages and small business loans because of the pandemic.
That didn’t happen and like the ANZ and Westpac, NAB has returned some of those provisions to its P&L account for this half. NAB wrote back $128 million compared to the $1.161 billion in provisions a year earlier.
(The ANZ’s write back was a high $491 million, while Westpac returned $372 million).
In commentary the bank was cautiously optimistic about the outlook (like the ANZ and Westpac were in their comments about the coming year), saying the rebound from COVID has been better than expected in the Australia and NZ economies.
But it said risks do remain, especially in the travel/tourism and related sectors such as hospitality.
Directors said the improvement saw the bank benefit in the half from “significantly better credit impairment outcomes”.
“This result and our growing confidence in the outlook, have allowed us to lift the 2021 interim dividend to 60 cents a share,” CEO Ross McEwan said in Thursday’s statement.
