As we approach the start of August, keen-eyed investors will be watching out for one thing: reporting season. August means many ASX companies report their half-year or full-year earnings, and National Australia Bank Ltd (ASX: NAB) shares will be on many investors’ radars.
Notably, NAB will actually not report its results until 9 November. That means shareholders have a long wait for further updates from the company itself compared to other investors. If you’re hungry for more info next month, here are a few things to watch out for in August that may impact NAB shares.
What factors could influence NAB shares in the August reporting season?
Perhaps the most obvious thing to watch is NAB’s own third-quarter trading update. NAB shares could be on the move following the company’s update scheduled for 12 August. However, there are other items that are also worth keeping an eye on next month.
Chief among them are the results of NAB’s fellow banks. Of particular note will be the Commonwealth Bank of Australia Ltd (ASX: CBA) full-year result on 11 August. Given the size and strength of the big four in Australia’s banking market, CBA’s results release will be hotly anticipated.
This could help investors work out how the banking sector, in general, has performed. It could also help inform expectations for net interest margins (NIMs), cash profits and loan impairments. On top of the purely financial information, commentary in the full-year results can provide an indication of what bank bosses are expecting in FY2022.
For many NAB shareholders, the CBA full-year result will likely be pencilled in on their calendars. CBA isn’t the only bank to be reporting earnings, however. Bendigo and Adelaide Bank Ltd (ASX: BEN) and Bank of Queensland Ltd (ASX: BOQ) results could provide an insight into how regional Australia is doing right now.
What about the residential mortgage market?
The housing market is on the minds of many Australians, but particularly those who own NAB shares. NAB has a significant proportion of the Australian residential mortgage market with $111.4 billion in risk-weighted residential mortgage assets as at 31 March 2021.
Therefore, for those who own NAB shares, one thing to keep an eye on could be Genworth Mortgage Insurance Australia Ltd (ASX: GMA). Genworth is one of two providers of lenders’ mortgage insurance (LMI) on home loans where deposits are less than 20%. That means Genworth generally does well when everyone pays for LMI with no defaults actually requiring the insurance payout to the lender.
A strong Genworth result could provide an indication of the residential mortgage market’s health right now. That would be worth watching if you’ve got an interest in NAB shares given the large proportion of residential mortgages held by the bank.