For the quarter cash earnings were $1.6 billion and the group maintained its most recent interim dividend at 99 cents per share, with analysts generally expecting the final November dividend to come in fractionally lower than 99 cents.
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National Australia Bank has posted a 3 per cent drop in third quarter unaudited cash earnings to $1.6 billion as the bank flagged rising bad debts.
Revenue was “broadly stable”, NAB said, as loan growth helped offset a “slightly lower” net interest margin, due to higher funding costs.
“The increase largely reflected the non-recurrence of the unusually low bad and doubtful debt charge in the first quarter of 2016 and an increase in the mining and agriculture collective provision overlay”.
The proportion of total loans that were more than 90 days past due lifted from 0.78 per cent to 0.81 per cent between the March and June quarter, NAB said.
“These higher funding costs contributed to our decision to not pass on all of the most recent RBA interest rate cut to home loan borrowers”, he said.
NAB is one of the four largest financial institutions in Australia in terms of market capitalization and customers.
The Bank also says the sale of 80% of its life insurance business to Nippon Life remains on track, and should be completed in the second half this calendar year.
“The Australian and New Zealand economies remain resilient and continue to deliver growth amid heightened global uncertainty”, said chief executive Andrew Thorburn in a statement to the ASX.
NAB shares bounced around amid early session short selling before closing up 25 cents, or 0.93 per cent, at $27.20.
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Its Common Equity Tier-1 ratio was 9.5 per cent at the end of June compared with 9.7 per cent in March.
