Has the NAB dividend been growing?

NAB is a strong ASX dividend share. But have this ASX bank’s dividends actually been growing?

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As an ASX bank share, National Australia Bank Ltd. (ASX: NAB) is concurrently known for being a strong dividend payer. It seems that to spiritually qualify as an ASX bank on the Australian share market, a bank needs to have a strong shareholder income policy.

This is reflected in all four of the ASX big four banks’ share prices today. All four currently have trailing, fully franked dividend yields over 4% today, with the exception of Commonwealth Bank of Australia (ASX: CBA), which is presently offering a dividend yield of 3.59%. In NAB’s case, we have a current dividend yield of 4.51%.

4.52% is objectively a pretty strong number for a dividend yield. It beats the pants off any savings account or term deposit the bank is currently offering. But many ASX income investors don’t just look at a raw dividend yield when it comes to choosing an income share. That can lead to picking a dividend trap. Thus, these investors often look to see if a company has been growing its dividend recently. After all, a growing dividend is a sign of a healthy and successful business. So has NAB been growing its dividend in recent times?

Has the NAB dividend been on the rise?

Well, it depends on what timeframe you want to use. NAB will pay its investors an interim dividend of 73 cents per share on 5 July. Its last dividend was the final dividend of 67 cents per share that shareholders got back in December.

These two dividend payments combine to give NAB shares their current yield of 4.51%. The interim dividend is indeed a healthy increase on 2021’s interim payment of 60 cents per share. It also looks pretty good against 2020’s interim dividend of 30 cents (although that was largely dictated by the pandemic back then).

However, zooming out and the comparison starts to become less rosy for NAB. 2019 saw the bank pay two dividends worth 83 cents per share each. Before that, NAB paid an annual total of $1.98 in dividends per share from 2014 to 2018.

So yes, the NAB dividend has been increasing over the past 12 months. But no, it has not been on a growth trajectory over any longer time frame. In fact, NAB’s dividends have been going backwards over the past four years or so. Something for income investors to consider today.

Motley Fool contributor Sebastian Bowen has positions in National Australia Bank Limited. 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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