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MarketScreener Homepage  >  Equities  >  Australian Stock Exchange  >  National Australia Bank Limited    NAB   AU000000NAB4

NATIONAL AUSTRALIA BANK LIMITED

(NAB)
  Report
End-of-day quote. End-of-day quote Australian Stock Exchange - 11/26
23.48 AUD   -2.37%
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Australia's Westpac flags $870.4 million hit to second-half cash earnings

10/25/2020 | 03:55pm EST

* Bank writes down value of Westpac Life Insurance Services

* Costs and provision for record settlement increase A$415 mln

* Westpac to release dividend decision and FY20 earnings Nov. 2

SYDNEY, Oct 26 (Reuters) - Australia's Westpac Banking Corp said on Monday it would take an $870 million hit to cash earnings in the second half, due mostly to write-downs in the value of its life insurance business and the additional costs of a record fine.

The announcement, one week before its full-year results and dividend announcement are due, added uncertainty about the ability of the country's second-largest bank to resume investment payouts.

The A$1.22 billion ($870.4 million) hit to cash earnings also includes an increase in provisions related to customer refunds and litigation, and a write-down for capitalised software, the bank said.

Credit Suisse said the separate write-downs and provisions were already expected by analysts, following the A$1.3 billion settlement announced last month for allowing illicit payments, for which the lender set a further A$415 million aside.

In aggregate, however, they "may contain some 'sticker shock'" for the market, Credit Suisse said.

Westpac this year became the only one of Australia's four major banks to slash dividend payments in the first half of the year, as it took the largest bad-debt provisions of all majors for possible losses in the aftermath of the coronavirus pandemic.

That has left it with one of the weakest capital positions of the four majors. In total, the announced charges and provisions will reduce the bank's common equity tier 1 ratio by 24 basis points, Westpac said.

About A$568 million of goodwill will be written off at Westpac Life Insurance Services and Westpac's Auto Finance business. A further A$182 million will top up its customer remediation provision, the bank added.

An A$26 million pre-tax gain on the sale of its stake in Zip Co Ltd in the first half of fiscal 2021 partially offset the other write-downs, Westpac said.

It will report full-year results and its dividend decision on Nov. 2.

($1 = 1.4017 Australian dollars) (Reporting by Paulina Duran in Sydney and Nikhil Kurian Nainan in Bengaluru; Editing by Andrew Heavens and Peter Cooney)


© Reuters 2020
Stocks mentioned in the article
ChangeLast1st jan.
CREDIT SUISSE GROUP AG 0.51% 11.715 Delayed Quote.-10.61%
NATIONAL AUSTRALIA BANK LIMITED -2.37% 23.48 End-of-day quote.-4.67%
WESTPAC BANKING CORPORATION -1.34% 20.61 End-of-day quote.-14.94%
ZIP CO LIMITED 3.58% 6.07 End-of-day quote.71.47%
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Financials
Sales 2021 17 023 M 12 563 M 12 563 M
Net income 2021 4 948 M 3 651 M 3 651 M
Net Debt 2021 - - -
P/E ratio 2021 16,6x
Yield 2021 3,79%
Capitalization 76 599 M 56 627 M 56 530 M
Capi. / Sales 2021 4,50x
Capi. / Sales 2022 4,43x
Nbr of Employees 31 372
Free-Float 99,5%
Chart NATIONAL AUSTRALIA BANK LIMITED
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National Australia Bank Limited Technical Analysis Chart | MarketScreener
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Technical analysis trends NATIONAL AUSTRALIA BANK LIMITED
Short TermMid-TermLong Term
TrendsBullishBullishNeutral
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus OUTPERFORM
Number of Analysts 15
Average target price 22,59 AUD
Last Close Price 23,32 AUD
Spread / Highest target 7,20%
Spread / Average Target -3,11%
Spread / Lowest Target -20,7%
EPS Revisions
Managers
NameTitle
Ross Maxwell McEwan Group CEO, Managing Director & Director
Philip Wayne Chronican Chairman
Patrick C. Wright Chief Technology & Operations Officer
Gary A. Lennon Group Chief Financial Officer
Geraldine Celia McBride Independent Non-Executive Director
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1st jan.Capitalization (M$)
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