NAB slashes 1900 jobs
Bank’s cash profit falls in ‘challenging year’
NATIONAL Australia Bank sacked 1900 people in a “challenging year” in which cash profit dropped 14 per cent to $5.7 billion as it was hit with banking royal commission scandal costs.
The dent to the bottom line came as the lender paid out $755 million in redundancies and other restructuring costs and $360 million in compensation to customers who had been poorly treated.
Stripping out those costs, the banking giant’s cash profit for the 12 months to September 30 was still down 2.2 per cent at $6.49 billion.
NAB is on a restructuring drive and chief executive Andrew Thorburn is cutting the workforce by 6000 employees by 2020 as it takes on leaner online competitors.
The $755 million in its latest result includes covering the full-three years of redundancy costs.
Mr Thorburn yesterday said job losses would continue as the bank uses more technology.
“It will happen as we automate the business,” he said.
“As changes are made, I am very conscious of the impact on people and their lives.”
NAB’s latest update follows ANZ revealing it has slashed 1000 jobs from its Australian operations over the past year.
Mr Thorburn said NAB is also aiming to employ 2000 new IT and technology specialists by 2020, taking the net overall staff drop to 4000 in that time.
On royal commission costs, for NAB chief executive Andrew Thorburn said job losses would continue as the bank uses more technology Mr Thorburn said he did not see the expenses of customer remediation for past misconduct growing significantly after this year’s whack.
Earlier this year, it emerged at the royal commission that NAB had charged fees to the accounts of more than 4000 dead customers amid a fee-forno-service scandal.
In some joy shareholders, NAB kept its final dividend steady at 99¢, taking total payments to $1.98 for the past financial year.
The bank’s revenue grew 0.5 per cent to $17.9 billion on the back of a better performance from the all-important business banking sector which grew earnings 2.5 per cent amid stronger small business lending.
Shares in NAB gained 0.6 per cent yesterday to $25.35.