Big Four bank National Australia Bank [ASX:NAB] released its 3Q results on Tuesday, with NAB shares falling 3%.
Rising interest rates have not benefited NAB much, with NAB up 3% year-to-date.
Source: www.tradingview.com
NAB’s third quarter 2022
NAB shared its third quarter results for the financial period ending 30 June 2022, reporting $1.85 billion in statutory net profit and $1.80 billion in cash earnings.
Cash earnings rose 6% compared to 3Q21.
NAB noted that cash earnings before tax and credit charges increased 2% in comparison with the quarterly average of the first quarter of FY22.
NAB’s net interest margin (NIM) was ‘slightly lower’ during the quarter.
NAB did say that excluding markets and treasury income, NIM was ‘up slightly reflecting the benefit of a rising interest rate environment’.
In a telling comment, the bank did say rising interest rates were offset somewhat by ‘home lending competition and higher wholesale funding costs’.
Expenses increased 1% in the quarter due to growth costs and personal employee expenses, balanced by productivity.
The bank said it has been helping customers manage high interest rates, adjusting loan repayments, and providing hardship support.
NAB has also provided $4.85 million in disaster relief for flood-impacted customers based in NSW and Queensland and has provided €1 billion to fund renewable energy projects.
NAB Outlook
NAB’s CEO Ross McEwan commented on the bank’s recent quarter:
‘As the economy changes, continued low unemployment and healthy household and business balance sheets are helping mitigate the impacts of higher inflation and higher interest rates…
‘Our business is also in good shape for this evolving environment. Balance sheet settings remain strong and we are well advanced on our FY22 term wholesale funding task with $34 billion raised by end June.
‘Investments to deliver simpler, more digital experiences for customers and colleagues are supporting balanced growth and productivity benefits which are expected to exceed $400 million in FY22.
‘We have a clear strategy and executing this with discipline is our key priority.’
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Regards,
Kiryll Prakapenka
