NAB (ASX:NAB) doubles previous payout on increased cash earnings

Company News

by Michael Luu

Banking giant National Australia Bank (ASX:NAB) has bumped up its interim dividend twofold from last year's payout to 60 cents per share, after its cash profit exceeded forecasts for the first half of FY21.

The $90.3 billion banking corporation recorded a half-on-half increase of 48.1 per cent to $3.3 billion in cash earnings for the March half.

Within the first six months, rapid economic recovery boosted the big-four bank’s income, as NAB’s revenue rose 1 per cent in the half-year period ending March 31.

NAB’s market analysts have attributed the positive data to the vaccine distribution effort and effective pandemic control.

The company also managed to cut operational costs by nearly 19 per cent, as NAB is also undergoing a process of streamlining its business structure to minimise expenses.

Optimistic sentiment has led the banking heavyweight to downgrade its credit allowance for bad debt by $128 million.

However, the bank’s CEO Ross McEwan reiterated the message of warning from other big banks that pandemic threats and coronavirus-related challenges have not fully disappeared, as “Risks do remain” and not all businesses have bounced back at the same pace.

Shares in National Australia Bank (ASX:NAB) last traded at $27.37