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NAB looks at options on Wealth returns
National Australia Bank (NAB) has flagged further changes within its Wealth division, using is full year results announcement to point to wealth product returns being "below acceptable levels".
The executive commentary attaching to the big banking groups results had its chief executive, Andrew Thorburn pointing to an improved year for NAB Wealth with cash earnings up 13.4 per cent off the back of strong growth in investment earnings and an increase in insurance earnings.
However he then went on to say, "Wealth products are an essential part of our customer offering, however returns are below acceptable levels and as a result we are evaluating a number of options to improve returns of this business".
It is understood that among those options is greater cross-sell, with the broader NAB results documentation pointing to the benefits of "stronger bank alignment" being reflected in a successful direct insurance offer and success with respect to mortgage protection.
Elsewhere in the company's analysis, referenced the fact that "closer integration with Australian Banking continues to gain traction with accelerating growth in sales of Masterkey Business Super via Business Banking channels and improved sales capability in the Retail network driving higher cross-sell rates.
The ASX announcement revealed that on a statutory basis, NAB recorded a 1.1 per cent decline in net profit attributable owners to $5.30 billion, with cash earnings declining to $5.18 billion, with the major contributing factors being the company's UK conduct provisions along with other factors such as capitalised software impairment, deferred tax asset provisions and a research and development tax policy change.
Thorburn noted that while the company's Australia and New Zealand franchises were in good shape it was "disappointing to record a full year result that includes $1.5 billion after tax in UK conduct provisions and other impairments".
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