Australian bank NAB reports 16 pct profit rise

AP News
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Posted: May 05, 2011 12:05 AM

National Australia Bank, one of the country's largest lenders, reported a nearly 16 percent rise in first-half net profits on Thursday amid a strong economy, lower bad debts and a predicted surge in business lending.

Net profit for the six months to March 31 was 2.43 billion Australian dollars ($2.61 billion), up from AU$2.1 billion in the same period a year ago, the Melbourne-based bank said in a statement. Cash earnings rose 21.7 percent to AU$2.67 billion.

"I think, broadly, we still see quite a few positives in the economy," CEO Cameron Clyne said. "Unemployment is relatively low, and there is an early sign that businesses are looking to invest again."

Clyne also credited the bank's decision to cut banking fees and lower interest rates, which has helped lure customers away from Australia's other big banks.

"This result is a sign that there is some momentum in that strategy," he said.

Charges for bad and doubtful debts fell by 19.7 percent to AU$988 million from the same period a year ago.

The bank declared an interim dividend of 84 cents per share, up from 74 cents a year earlier.

Clyne said he expected business lending to continue strengthening through the end of the year.

Shares were up AU$0.33, or 1.25 percent, to AU$26.72 in early morning trading.