Business

The National Australia Bank reports flat profits for the first quarter

NAB says the volume of frozen home loans to its clients has decreased from A $ 38 billion to A $ 2 billion. (File photo)

Sydney: The National Australia Bank (NAB) announced steady profits for the first quarter of its fiscal year Tuesday, and said the ongoing coronavirus lockdowns added to the uncertainty going forward.

The bank, one of Australia’s four largest banks, said its net profit for the quarter ended December 31 was A $ 1.7 billion, compared to the same period in 2020.

The bank’s preferred measure of cash earnings was A $ 1.65 billion, up 1% on the same period last year.

But compared to the quarterly average for the second half of 2020, when Australia was still feeling the economic impact of the coronavirus crisis, cash earnings rose 47%.

NAB CEO Ross McEwan said that “improved economic trends” were encouraging in Australia and New Zealand as the two countries successfully contained the coronavirus pandemic.

“At a fundamental level, it has performed well in the current competitive environment with low interest rates,” he said, adding that the bank had seen a sharp drop in loan deferrals.

But McEwan said that “health alerts” related to the Covid-19 outbreak in major cities continued to create “uncertainties that require greater clarity.”

Authorities have ordered sudden closures in recent weeks in the capitals of the Australian states of Brisbane, Perth and Melbourne and in Auckland, New Zealand’s largest city, to prevent small outbreaks of highly contagious Covid-19 variants from spreading.

So far, outbreaks have been successfully contained.

McEwan said the end of state economic support programs, including so-called employer wage subsidies in Australia, had added to the uncertainty.

But the bank said the volume of frozen home loans to its customers had decreased from A $ 38 billion to A $ 2 billion, and credit impairment charges were down 98% from the average for the second half of 2020.

The Australian economy contracted in the first two quarters of last year in the first recession in the country in nearly three decades.

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