Bulletin: NAB Bolsters Balance Sheet Against COVID-19 Hits

SYDNEY (S&P Global Ratings) April 27, 2020--Measures announced by National Australia Bank Ltd. (NAB; AA-/Negative/A-1+) today to shore up its capital should, in S&P Global Ratings' view, position the bank well to contend with higher credit impairments and weaker operating income that we expect to eventuate due to the COVID-19 outbreak and containment measures. NAB's capital management initiatives include a A$3 billion fully underwritten share placement and a non-underwritten share purchase plan of about A$500 million. At the same time, NAB reduced its dividend payout ratio to about 35% from levels in excess of 70% in prior periods. On its own, the additional capital raising would add about 80 basis points (bps) to NAB's regulatory capital ratio. During this period

...April 26, 2020 SYDNEY (S&P Global Ratings) April 27, 2020--Measures announced by National Australia Bank Ltd. (NAB; ##-/Negative/A-1+) today to shore up its capital should, in S&P Global Ratings' view, position the bank well to contend with higher credit impairments and weaker operating income that we expect to eventuate due to the COVID-19 outbreak and containment measures. NAB's capital management initiatives include a A$3 billion fully underwritten share placement and a non-underwritten share purchase plan of about A$500 million. At the same time, NAB reduced its dividend payout ratio to about 35% from levels in excess of 70% in prior periods. On its own, the additional capital raising would add about 80 basis points (bps) to NAB's regulatory capital ratio. During this period of uncertainty we expect other major Australian banks to also take similar capital management initiatives to prepare for adverse operating conditions. The bank's reported cash earnings were down significantly to...

Bulletin