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AUSTRALIA-BANKING-EARNINGS-NAB
NAB earnings slide on restructuring, scandal costs
SYDNEY, Nov 1, 2018 (BSS/AFP) – National Australia Bank reported Thursday
a 14.2 percent drop in cash earnings to AU$5.7 billion (US$4.0 billion) due
to restructuring charges and the costs of repaying customers impacted by bank
misconduct.
NAB’s profit in the year to September 30 was still up five percent to
AU$5.55 billion despite what chief executive Andrew Thorburn called a
“challenging year”.
“Our transformation is on track and benefits are emerging as we become
simpler and faster,” he said, pointing to growth in both housing and business
lending.
NAB’s result followed a similar announcement Wednesday by ANZ, another of
Australia’s “Big Four” banks, which reported a 16 percent drop in cash
earnings.
NAB, ANZ and Australia’s other main banks — among the world’s wealthiest
— have been the target of a top-level inquiry that found the companies had
committed widespread misconduct, including charging the dead for services,
providing questionable financial and life insurance advice and mortgage
fraud.
In an interim report released in September, the public inquiry accused the
big banks of pursuing “short-term profit at the expense of basic standards of
honesty”.
NAB’s 2018 results included AU$360 million in customer remediation payouts
linked to the inquiry’s findings, as well as $755 million in restructuring
costs, mainly linked to redundancy payments.
Thorburn said the NAB was actively addressing the shortcomings uncovered
by the royal commission — the country’s top level of public inquiry.
“We are listening and responding to customers, including to royal
commission issues, and are proactively taking steps to be more customer
focused,” he said.
BSS/AFP/HR/0912