National Australia Bank (ASX:NAB) Announces Third Quarter 2025 Trading Update
Financial Performance
National Australia Bank reported a 2% underlying profit growth for the June 2025 quarter compared to the first half of 2025, despite a 1% decrease in cash earnings. Revenue increased by 3%, driven by a 4% rise in revenue excluding Markets & Treasury income. Net interest margin improved by 8 basis points, while expenses grew by 3%.
Operational Highlights
The Business & Private Banking sector saw a 4% growth in business lending, achieving the highest June monthly business lending balance growth of $4.6 billion. Home lending grew by 2%, and deposits increased by 6% over the nine months to June 2025. NAB also raised $30.5 billion in term wholesale funding during this period.
Strategic Initiatives
NAB announced the sale of its remaining 20% stake in MLC Life Insurance to Nippon Life Insurance Company for $500 million, expected to complete in H2 2025 pending regulatory approvals. The bank targets productivity savings exceeding $400 million for FY25.
Capital and Liquidity
The Group CET1 ratio improved to 12.14% in June 2025, with a proforma Level 2 CET1 ratio of 12.25% following the sale of the MLC stake. The leverage ratio stands at 5.1%.
Executive Comments
“Execution of NAB’s strategy and focus on our key priorities has supported a 2% lift in underlying profit this quarter. Over the three months to 30 June 2025, Business & Private Banking (B&PB) business lending grew 4% and we achieved our highest ever June monthly business lending balance growth of $4.6bn. We remain optimistic about the outlook and are well placed to manage NAB for the long term and deliver sustainable growth and returns for shareholders,” said Andrew Irvine, NAB CEO.
Motley Fool contributor Kiarra Jackson has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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