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- National Australia Bank (NAB) posts an unaudited statutory net profit of $1.75 billion for the June quarter 2023
- The major bank also reported cash earnings of $1.9 billion for the quarter
- NAB announced plans to repurchase up to $1.5 billion of its ordinary shares on the market
- The buyback plan is set to commence in late August 2023, pending favorable market conditions
- NAB was up 1.13 per cent, trading at $28.65 at 12:01 pm AEST
National Australia Bank (NAB) has reported an unaudited statutory net profit of $1.75 billion for the June quarter of 2023.
The major bank also disclosed cash earnings of $1.9 billion for the quarter, a five per cent decline on the 1H23 quarterly average. However, Q3 earnings increased by 5.8 per cent compared to the same period last year.
“We have delivered a sound 3Q23 result, following a very strong 1H23 outcome,” MAN CEO Ross McEwan said.
“Our performance during these periods has benefited from the consistent and disciplined execution of our strategy, against a backdrop of higher interest rates but also slowing growth, inflationary pressures and elevated competition.”
In addition to the financial results, NAB announced its plans to repurchase up to $1.5 billion of its ordinary shares on the market.
This share buyback initiative is part of the bank’s strategy to enhance its Common Equity Tier 1 (CET1) ratio toward a target range of 11-11.5 percent. The CET1 ratio serves as a key indicator of the bank’s financial strength.
The share buyback is set to commence in late August 2023, pending favorable market conditions.
NAB’s decision aligns with its commitment to maintaining a robust balance sheet throughout market cycles while concurrently reducing its overall share count over time.
As of June 30, 2023, NAB’s recent financial report indicates a CET1 capital ratio of 11.9 percent at both Level 1 and Level 2.
The proposed $1.5 billion share buyback is expected to impact the CET1 capital ratio by approximately 35 basis points at Level 2 and around 40 basis points at Level 1. Taking into account the anticipated share repurchase, NAB’s pro forma CET1 ratio for June 2023 stands at 11.6 percent for Level 2 and 11.5 percent for Level 1.
NAB’s decision to repurchase shares is a proactive step in its ongoing efforts to strengthen its financial position and enhance shareholder value.
NAB was up 1.13 per cent, trading at $28.65 at 12:01 pm AEST.
