The National Australia Bank Ltd. (ASX: NAB) share price is down 9.82% since the beginning of 2015.
Indeed, Australia's largest business bank, much like its peers, has had a tough year convincing investors of the outlook for its business.
A peak in house prices, tougher regulatory scrutiny, rapidly increasing competition, the digital threat, unprecedented capital raisings and slowing credit markets have each weighed on the big four banks' share prices throughout the year.
Australia and New Zealand Banking Group (ASX: ANZ) has been the worst-performing major bank, falling 13.4% in 2015. Westpac Banking Corp (ASX: WBC) is slightly higher than the price at which it started the year.
Specifically, NAB shareholders have yet again been asked to deal with the bank's legacy issues.
NAB's new CEO, Andrew Thorburn, kicked off 2015 with the divestment of the bank's US agribusiness and business banking subsidiary, Great Western Bancorp. The bank was listed on the New York Stock Exchange late last year, and its share price has since soared 60%.
In light of the US success, NAB is seeking to offload its embattled Clydesdale and Yorkshire Banking Group over in the UK. The Clydesdale Group has been under the microscope of UK regulators for many years after misconduct, poor compliance and lending practices left a wake of disgruntled customers following the Global Financial Crisis. Eight years on these issues still plague the bank.
NAB has continued to pay down mammoth amounts of bad debts associated with the UK issues; raised capital from shareholders to fund a contingency package; and announced it intends to float Clydesdale Group shares on both the ASX and London stock exchange, subject to some approvals, with the help of existing shareholders and new institutional owners.
NAB also sold its life insurance business to Japan's Nippon Life earlier this year, in another attempt to focus on its core banking assets in Australia and New Zealand.
Looking ahead into 2016 and beyond, NAB will hope to restore investor sentiment with the float of the Clydesdale Group, and by leveraging its strong position in business banking and household lending.
Buy, Hold or Sell?
NAB has had a very busy year, but its share price has come under meaningful selling pressure, underperforming the broader S&P/ASX 200 (Index: ^AXJO) (ASX: XJO).
There's a chance its shares could put in a better showing throughout 2016. However, I remain a little sceptical. Indeed, at current prices, the risk-reward trade-off does not appear to be compelling, despite a big forecast dividend payout.
