The bank’s restructuring efforts dragged its profitability.
National Australia Bank’s (NAB) cash profit dropped 16% YoY to $2.07b (AU$2.76b) in the first half of 2018, according to the company’s financial statement, as restructuring costs hit the bank’s earnings.
Diluted cash EPS also dropped 17% to 98.8 cps whilst cash ROE remained on a downward trend after falling 11.4%. Funding pressures also build up even as stable NIM manage volume-margin trade-offs.
NAB is also the latest to retreat from the trouble wealth management scene after the company confirmed plans to either sell or demerge MLC by the end of next year, following other major lenders CBA and ANZ who have already divested their stake in the business.
“We do think serving the wealth needs of our clients is important, but we have to do it differently. I think divesting this will simplify the bank dramatically. Right now I think the cost of complexity is really high in terms of mistakes and customer experience,” said NAB CEO Andrew Thorburn.
The bank earlier sold 80% of its life insurance arm to Nippon Life in 2015, in a deal that allows NAB to distribute the insurance policies.
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