National Australia Bank’s (NAB) 2025 results were largely in line with expectations, according to UBS analyst John Storey. The bank reported a cash net profit of $3.5 billion, slightly below UBS’s forecast of $3.6 billion. Cash earnings per share of 114¢ aligned with the consensus estimate of 113¢. NAB is one of Australia’s largest financial institutions, offering a wide range of banking and financial services to individuals and businesses.
Storey highlighted key positives, including a strong performance in personal banking, where deposits and pricing drove a 26 per cent increase compared to the previous half. Total revenue also saw growth, rising by 2.4 per cent to $10.5 billion. The revenue growth was supported by a net interest margin beat driven by replicating portfolio benefits, although Storey raised questions about the sustainability of this advantage.
Credit quality showed some signs of softening, with an increase in non-performing loans and a 40 per cent rise in credit impairment charges compared to the first half. Costs also increased by 5 per cent as NAB focused on maintaining its leadership in business banking. Capital metrics were a significant point of interest, with the bank’s CET1 ratio at 11.7 per cent.
This figure was slightly below UBS’s estimate of 12.2 per cent and the consensus of 11.8 per cent, leaving NAB with limited flexibility relative to its target range. Storey noted that the result was ‘largely in line’ overall, despite the slight deviation in the CET1 ratio.
