NAB full-year profit tops estimates on broad rebound

Bloomberg

National Australia Bank Ltd.’s (NAB) full-year profit beat forecasts as the lender continued to ride the wave of a stronger-than-expected recovery in the nation’s economy.
Cash earnings climbed to A$6.56 billion ($4.87 billion) in the year ended September 30, compared with A$3.71 billion ($2.73 billion) a year earlier, according to a statement. That beat the A$6.45 billion mean estimate of 13 analysts surveyed by Bloomberg. The country’s biggest business bank will pay a final dividend of 67 Australian cents per share.
“Our bank has momentum, our strategy is clear and as lockdown restrictions ease, a pick-up in activity is expected,” National Australia Chief Executive Officer Ross McEwan said in the statement. There were “some uncertainties” in the outlook, but the bank is well positioned for the expected economic rebound in Australia and New Zealand, he said.
The Melbourne-based lender’s result caps a year that’s seen a strong rebound from pandemic for Australian banks, shareholders rewarded with buybacks
and a buoyant housing market supporting mortgage demand.
The result leaves National Australia well placed for further buybacks with A$5.2 billion of surplus capital, according to Bloomberg Intelligence senior industry analyst Matt Ingram. The shares reversed early gains at the start of Sydney trading, slipping 0.8% as of 10:22 am.
The bank further cemented its position as the largest lender to small to medium businesses, with lending growing 7%,
beating the average expansion within that market.
National Australia also wound back provisions by A$217 million.
Goldman Sachs Group Inc. analysts said the result was supportive of the firm’s “buy” recommendation on the shares, and National Australia remains the preferred exposure to the Australian banks.