SYDNEY, Nov 7, 2019 (BSS/AFP) – National Australia Bank announced Thursday that its profits fell more than 13 percent in 2019, the latest in a string of poor results for the country’s banks as they address years of rampant malpractice.
A damaging industry scandal has forced NAB and Australia’s other major banks to allocate billions of dollars to repay customers for unfair fees and dodgy financial advice.
The Melbourne-based NAB said its net profit in the year to September 30 had fallen to Aus$4.7 billion ($US3.23 billion), in what CEO Philip Chronican described as a “very challenging” year that required “significant actions to deal with past issues”.
A lengthy Royal Commission that wrapped up in February found banks had charged fees to dead people, charged fees for no services at all, used aggressive selling tactics and provided poor advice that led to significant financial upheaval for clients.
NAB was singled out for especially harsh criticism, resulting in the departure of the firm’s CEO and chairman.
The company has set aside more than Aus$2 billion to repay customers and has a team of nearly 1,000 people dedicated to its remediation efforts.
“We are determined to move forward by fixing issues of the past and taking actions to meet customer and community expectations,” Chronican said in a statement.
“A gap remains between where we are today and where we need to be for customers, but we are making progress.”
The bank has cut its dividend to shareholders by 16 percent compared to 2018, bringing the full-year divided to Aus$1.66 per share.
The announcement comes just days after Westpac bank said its profits had fallen 16 percent in fiscal 2019, while the ANZ bank reported late last month a seven percent drop in profits for the same year.