National Australia Bank, the nation’s biggest business lender, stared down mounting competition in that lucrative segment to grow cash profit by 1 per cent in the first half, while expressing cautious optimism on the outlook for the economy.

Cash earnings of $3.6 billion beat market expectations, sending the stock up 4 per cent in early trading before it settled 1.6 per cent higher at $35.87, a stronger performer than other major banks on Wednesday.