Highlights:
- Shares of National Australia Bank fell around 4% during the early trading hours on Tuesday (9 August 2022).
- NAB’s unaudited cash earnings and statutory net profit during the third quarter of FY2022 stands at AU$1.80 billion and AU$1.85 billion respectively.
- The banking giant issued €1 billion green bond in May.
- NAB acquired Citigroup’s Australian consumer business, which was in effect from 1 June 2022.
One of the largest Australian banks, National Australia Bank Ltd (ASX:NAB), shared its June quarter results via ASX on Tuesday (9 August 2022). As per the release, the company has delivered a solid set of numbers during the June quarter.
The share price of NAB, however, dropped 4.22% to AU$29.46 per share at 10:30 AM AEST. Meanwhile, the benchmark index, S&P/ASX 200 Financials was down by 1% to 6,293.30 at 10:51 AM AEST.
Highlights of the June quarterly results
In the third quarter of the financial year 2022 (3QFY220), the unaudited cash earnings of the company increased to AU$1.80 billion, a 3% surge from the quarterly average of the first half of the financial year 2022 (1HFY22). Unaudited statutory net profit was AU$1.85 billion.
The expenses increased by 3% during the quarter on the 1HFY22 quarterly average.
Cash earnings before tax and credit impairment charges grew by 2% (compared to the 1HFY22 quarterly average). During the quarter, revenue rose by 2% due to a surge in volume, partially offset by a decrease in Markets & Treasury (M&T) income.
The credit impairment charge (CIC) in the quarter was AU$11 million.
90+ days past due and gross impaired assets to gross loans and acceptance decreased to 0.7%. This shows improvement across the home loan portfolio of the country and a low level of impaired assets in the lending portfolio.
The CET1 ratio compares the capital of the bank against its assets. The CET1 ratio of NAB for the third quarter is 11.6%. The leverage ratio was at 5.1%, net stable funding was 121%, and liquidity coverage ratio was 136%.
How is NAB contributing to the community?
NAB has introduced various options like splitting loans, accessing available redraw, adjusting loan repayments and hardship support through NAB assist to support people combating hard financial times.
For extending support to the flood-impacted communities in Queensland and New South Wales, AU$4.85 million of funds have been sent since February’s end.
The bank has also done green financing as it issued a €1 billion green bond in May to offer support to green buildings and renewable energy projects.
Financial impact of acquiring Citigroup (NYSE:C) The acquisition of the Australian consumer business of Citigroup was effective from 1 June 2022. The acquisition has positively contributed to the company's net interest margin (NIM) during the quarter.
The transaction added AU$13.2 billion to the gross lending balances and AU$9.4 billion to deposit balances.