The National Australia Bank Ltd (ASX: NAB) share price is in focus today, after the bank reported half-year cash earnings excluding large notable items of $3,588 million, up 2.3% on the prior half, alongside a fully franked interim dividend of 85 cents per share.
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What did National Australia Bank report?
- Cash earnings excluding large notable items rose 2.3% to $3,588 million
- Statutory net profit after tax fell 18% to $2,750 million
- Net interest income increased 2.3% to $9,163 million
- Net interest margin was 1.81%, three basis points higher than the previous half
- Interim dividend of 85 cents per share, fully franked
- Group Common Equity Tier 1 (CET1) ratio of 11.65%
What else do investors need to know?
NAB's first-half result included a $949 million charge related to a change in software capitalisation policy, classed as a large notable item. Excluding this impact, the bank recorded solid underlying profit growth, supported by 5.4% growth in Business & Private Banking.
The bank saw Australian business lending rise 5.6% over the half. Home lending drawdowns through proprietary channels increased from 41.4% to 47.7%. Deposit balances in Business & Private Banking and Personal Banking grew 4.7%, anchored by strong transaction account growth.
NAB took a proactive step to strengthen its balance sheet, increasing forward-looking collective provisions by $300 million as a buffer against heightened geopolitical and economic uncertainty. Customer advocacy metrics continued to improve.
What did National Australia Bank management say?
NAB CEO Andrew Irvine said:
Continued disciplined execution of our strategy and ongoing momentum across our business is reflected in NAB's 1H26 operating performance. Changes to our software capitalisation policy this period, consistent with the rapidly changing technology environment, have lowered cash earnings by $949 million. Excluding this large notable item (LNI), cash earnings were 2.3% higher than 2H25 with underlying profit up 6.4% supported by strong growth of 5.4% in Business & Private Banking (B&PB).
We are well placed to navigate a period of increased volatility. We will continue to manage our business for the long term to deliver sustainable growth and attractive returns for shareholders.
What's next for National Australia Bank?
Looking ahead, NAB expects slower credit growth and continued volatility with geopolitical risks and lingering inflationary pressures. The bank's focus remains on growing business banking, broadening its deposit base, and strengthening proprietary home lending.
NAB is also targeting productivity benefits exceeding $450 million for FY26, with cost growth expected to remain below 4.6%. Its capital and funding settings, including a discounted and partially underwritten dividend reinvestment plan, aim to keep the CET1 ratio solid in an uncertain environment.
National Australia Bank share price snapshot
Over the past 12 months, NAB shares have increased 11%, outperforming the S&P/ASX 200 Index (ASX: XJO) which has risen 7% over the same period.
