National Australia Bank Ltd.

In our view, NAB and the other major Australian banks' dependence on domestic and offshore wholesale funding remains a weakness. This is notwithstanding improvements over the past 10 years across the banking system. The ratings on NAB benefit from our expectation that the Australian government is highly likely to provide timely financial support to the bank, if needed. The rating outlook on NAB is stable. We expect economic risks facing Australian banks to remain low despite rising interest rates, falling consumer and business confidence, and the possibility of a rapid fall in house prices. In our base case, we project that, in the next two years, house prices in Australia will fall in an orderly manner by about 15%. We

...National Australia Bank Ltd.'s (NAB) strong market position and focus on low-risk retail, SME, and commercial banking activities in Australia and New Zealand will continue to support its earnings profile. The economies of both countries are recovering strongly from the impact of the COVID-19 pandemic. NAB's strong capitalization should remain a strength for its credit profile. The bank's credit losses will likely revert to pre-pandemic levels over the next one to two years. In our view, NAB and the other major Australian banks' dependence on domestic and offshore wholesale funding remains a weakness. This is notwithstanding improvements over the past 10 years across the banking system. The ratings on NAB benefit from our expectation that the Australian government is highly likely to provide timely financial support to the bank, if needed....

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