Yorkshire Bank owner NAB looks to exit UK

NATIONAL Australia Bank has confirmed it is exploring options to exit the UK which could see its Yorkshire and Clydesdale Banks floated on the stock market.

The Melbourne-based bank, which bought Yorkshire in 1990 and Clydesdale in 1987, said it is now examining a range of options for its UK banks, which contributed to a fall in group profits as a result of higher charges in relation to the PPI and interest-rate swap scandals.

NAB announced a 1.1% drop in net profit to A$5.3bn and saw cash earnings fall 9.8% to $5.18bn in the year to September.

Its chief executive Andrew Thorburn, who has already announced plans to dispose of its US-based Great Western Bank through a stock market listing, highlighted a need for “greater urgency” in dealing with low returning assets.

“While our Australia and New Zealand franchises are in good shape, it is disappointing to record a full year result that includes $1.5bn after tax in UK conduct provisions and other impairments,” he said.

“Our clear focus is on our Australian and New Zealand franchises and providing a better customer experience, and as a result we need greater urgency dealing to our remaining low returning assets. In relation to exiting UK Banking this means we are now examining a broader range of options including those provided by public markets.”

Results for Yorkshire and Clydesale were also released, which saw annual pre-tax earnings rise by 90% to £203m, while the charge for bad debts was down £78m (49%) to £80m.

David Thorburn, chief executive of the UK banks, said: “Against a backdrop of continued underlying performance improvement and a strengthened UK economy, we’re now well positioned for sustainable growth over the medium term.

“We’ve made good progress in the past year in sharpening the competitiveness of our products, introducing customer service enhancements and improving the efficiency of our operations. In addition, we have undertaken extensive programmes to address legacy conduct issues and ensure fairness for our customers is at the heart of everything we do.”

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