Like the rest of the big four banks, National Australia Bank Ltd (ASX: NAB) shares are a popular option for income investors.
That's because each year the banking giant shares a good portion of its huge profits with shareholders in the form of dividends. This makes it a great source of passive income.
Passive income from NAB shares
In the recently completed FY 2023, the bank reported an 8.8% increase in cash earnings to $7,731 million. NAB's earnings growth was driven by a 13.2% increase in net interest income and an 11.7% lift in other operating income.
This allowed the NAB board to declare and pay total dividends of 167 cents per share, which was up 10.6% year on year. This represents a total payout of $5.2 billion going into the pockets of investors and super funds across the country.
But those dividends have been and gone. Will NAB shares be a good passive income option in the future? Let's find out what a $10,000 investment could generate.
NAB dividend forecast
If you were to invest $10,000 into NAB shares at the current price of $30.56, you would end up with 327 units.
Now let's see what sort of passive income those units could provide.
According to a recent note out of Goldman Sachs, its analysts are expecting a slight cut to its dividend in FY 2024. The broker has pencilled in a fully franked 162 cents per share.
This represents a 5.3% dividend yield and would mean income of approximately $530.
And if you were wondering about the future, Goldman expects NAB to keep its dividend on hold at 162 cents per share in FY 2025. This would mean another 5.3% yield and a passive income of $530.
Overall, this could make NAB shares worth a closer look if you're seeking an income boost in 2024 and 2025.
