NAB boss bids to rally the troops
‘Let’s get all hands on deck’
NATIONAL Australia Bank acting chief executive Phil Chronican has called for a “whole of government” approach to rejuvenate business confidence and encourage investment.
Mr Chronican says a simiar approach worked in 2014, when concerted action across all arms of government — including regulators — had reined in the boom in house prices.
“The most important issue that I think our leaders in Canberra and our leaders in business need to focus on is that, if we’re going to have sustainable growth in Australia, it needs to come from business investment,” Mr Chronican said yesterday.
“Therefore, the more we can do to drive confidence in the small business community, and ensure that we as banks are able to be in a position to support that confidence with credit, the sooner we’re going to get on to a sustainable growth path.”
Mr Chronican, who will chair NAB’s board from November 15, was speaking after the bank reported a net profit of $4.8 billion for the year to September, down 13.6 per cent from the previous year.
Cash profit — a measure of underlying earnings that is closely watched in the banking industry — fell 10.6 per cent to $5.1 billion, below the $5.19 billion broadly expected by analysts.
Mr Chronican said the burden of regulation, including hurdles in credit approval processes, was an impediment to business investment.
“In our own case, getting a clarified and simplified approach to (regulatory concerns around) responsible lending … would certainly be helpful,” Mr Chronican said.
“In the case of our customers, I think that a lot of it is tied up in many of the planning and development issues that they have to get involved with.”
While medium-term reform to the tax system was helpful, a better near-term means of kickstarting a business investment cycle was micro-economic and regulatory reform, he said.
Unveiling its results yesterday, NAB revealed it would cut its final dividend to 83c, fully franked, down from 99c a year ago. The reduction mirrors the cut to its interim payout in May.
Shares in the bank jumped 2.2 per cent, or 62c, yesterday to $28.42.
NAB also announced that members of its executive leadership team would receive no short-term bonuses and no increase to fixed pay.
Executives had been eligible for short-term bonuses of up to $14.4 million, the bank said.