Strong NAB result, but MLC and NAB Wealth struggle
The National Australia Bank has produced solid full-year results, finishing the 12-month period in good shape, reporting a 23.6 per cent increase in net profit after tax to $5.2 billion and generating a total dividend of 172 cents per share.
However, its wealth-related businesses MLC and NAB Wealth struggled during the period, reporting a 12.5 per cent decline in cash earnings to $533 million, which the bank attributed to weak investment markets and lower earnings in the insurance business.
The company's announcement to the Australian Securities Exchange said insurance earnings had decreased due to higher levels of claims and changes in the lapse mix, while Funds Under Management as at 30 September had fallen by 2.9 per cent to $112.7 billion "as a result of deterioration in investment markets during the second half of the year and subdued discretionary flows across the industry".
Despite the tough conditions, MLC and NAB Wealth had continued to invest, with advisers' numbers up from 1,555 to 1,864 over the period.
Commenting on the overall result, NAB chief executive, Cameron Clyne said it represented a good result which demonstrated the banking group had continued to strength its core banking businesses.
Discussing the MLC and NAB Wealth result, Clyne said the reduction in cash earnings was largely the result of weak and volatile markets.
"The sales of Wholesale Banking products and services across the wider Group customer base continued to increase, and MLC and NAB Wealth continued to grow financial adviser numbers, launch new products, and increase its customer base," he said.
AUTHOR
Mike Taylor
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