National Australia Bank posted a 22.8 percent spike in first-half net profit Thursday on the back of higher revenue from personal and wholesale banking, a result that met expectations.
Australia’s fourth biggest lender said it booked a profit of Aus$2.52 billion (US$2.56 billion) in the six months to March 31, up from Aus2.05 billion a year earlier.
Cash earnings, which strips out volatile items and is the measure more closely watched by analysts, rose 3.1 percent to Aus$2.92 billion, “mainly due to higher earnings in personal banking and wholesale banking”.
“NAB has delivered a solid March half-year result, with continued growth in the Australian and New Zealand businesses and a stronger balance sheet,” NAB chief executive Cameron Clyne said.
Its result took the combined cash profits made by the big four banks — along with Westpac, Commonwealth and ANZ — in the first six months of their fiscal years to nearly Aus$13.0 billion.
NAB has lagged its peers in recent years as its British businesses have eroded revenues, and it posted the smallest half-year profit of the big four and the weakest growth.
Its share price slid 2.07 percent to close at Aus$32.68.
Last year, NAB said it was planning to restructure its British arm, slashing more than 1,400 jobs by 2015 due to weak economic conditions.
Clyne said the bank’s review of its British businesses, particularly the Clydesdale and Yorkshire banks, was ahead of plan.
“The UK banking business is managing a smaller and stronger balance sheet following the transfer of the vast majority of its commercial real estate portfolio to National Australia Bank Limited in October 2012,” he said.
The bank provided no outlook, but said its recently updated business strategy and technology upgrade would improve customer service, reduce errors and cut costs.
IG market strategist Evan Lucas said NAB’s numbers were in line with forecasts.
“The NAB results were expected to be solid and it has managed to deliver this,” he said.
“However, considering market expectations after stellar results from ANZ and WBC, this might be taken as a disappointment.
“Once more NAB is playing catch up — every time the bank takes a good step forward, its peers continue to skip away.”
NAB declared an interim dividend of 93 cents a share, compared with 90 cents a year earlier.
Australia's NAB half-year profits up 23%
