National Australia Bank’s credit losses to remain low

Its CET1 ratio is expected to rise once it concludes the sale of its stake in MLC Life Insurance.

National Australia Bank’s (NAB) credit losses are anticipated to remain low over the next two years, close to pre-pandemic levels, according to S&P Global Ratings.

The Melbourne-headquartered bank reported a 1% increase in cash earnings for the H1 2025 period that ended on 31 March.

Stable earnings and ongoing cost control will support the bank’s credit profile, the ratings agency said.

“Nevertheless, banks in Australia, including NAB, remain vulnerable to an increase in credit losses due to high household debt, elevated interest rates, and consumer prices, and global economic uncertainties,” S&P said.

The bank’s regulatory capitals is expected to remain strong over the next two years. CET1 ratio is 12.01% in H1, and is expected to be 12.13% upon conclusion of the sale of its 20% stake in MLC Life Insurance.