NAB result reflects UK exposure
National Australia Bank (NAB) has paid a price for its UK banking exposures, reporting a 15.5 per cent decrease in net profit to $2.052 billion for the six months to 31 March.
Announcing the half-year result to the Australian Securities Exchange (ASX) today, the big banking group said the reduced profit was primarily due to the charges relating to the outcomes of the UK Banking strategic review, the outcome of which was announced a week ago.
However NAB Wealth also took a hit, with the bank reporting that cash earnings were down $10 million or 3.7 per cent compared to the same period last year, largely as a result of an increase in insurance lapses.
However the bank's analysis claimed "adviser interest in NAB Wealth's progressive business model remains strong and led to an 8.7 per cent increase in aligned financial advisers since March, 2011".
It said the business continued to develop new products and services over the half, including the launch of a new insurance product, MLC Insurance, and the acquisition of direct funds management business Antares Capital Partners, formerly known as Aviva Investors Australia.
Commenting on the result, NAB chief executive Cameron Clyne claimed the banking group was continuing to make progress against its strategic agenda.
Referring specifically to NAB Wealth, he said that despite sluggish investment markets and an increase in insurance lapses, the group had grown both funds under management and premiums inforce.
"The business continued to invest in the development of new products and services during the half, releasing a new insurance product, MLC Insurance, and a refresh of MasterKey fundamentals," Clyne said.
He said adviser numbers had grown, with 84 net new financial advisers joining aligned networks, while costs had been tightly managed.
The company declared a fully franked interim dividend of 90 cents per share.
Recommended for you
In this week’s episode of Relative Return Unplugged, AMP chief economist Shane Oliver joins the show to unravel the web of tariffs that US President Donald Trump launched on trading partners and take a look at the way global economies are likely to be impacted.
In this episode of Relative Return, host Laura Dew is joined by Andrew Lockhart, managing partner at Metrics Credit Partners, to discuss the attraction of real estate debt and why it can be a compelling option for portfolio diversification.
In this week’s episode of Relative Return Unplugged, AMP’s chief economist, Shane Oliver, joins us to break down Labor’s budget, focusing on its re-election strategy and cost-of-living support, and cautioning about the long-term impact of structural deficits, increased government spending, and potential risks to productivity growth.
In this episode of Relative Return, host Laura Dew chats with Mark Barnes, head of investment research, and Catherine Yoshimoto, director of product management, from FTSE Russell about markets in Donald Trump's second presidency and how US small caps are faring compared to their large-caps counterpart.
