NAB chief Ross McEwan dismisses business banking rivals

National Australia Bank expects to remain the nation’s top business bank, regardless of the ambitions of its rivals.

Ross McEwan says NAB is ‘the biggest business bank and we won’t be giving that up any time soon’. Picture: Bloomberg

National Australia Bank chief executive Ross McEwan has dismissed threats from ambitious ­rivals seeking to topple NAB from its perch as the nation’s top business bank.

While welcoming competition from the likes of his Commonwealth Bank counterpart and former colleague Matt Comyn, Mr McEwan said the data continued to show NAB had the largest share of the keenly contested SME ­market.

“We are the biggest business bank and we won’t be giving that up any time soon,” he said.

Asked if he had a message for Mr Comyn, Mr McEwan said: “You will find it more difficult than you think.”

Cash earnings for the business and private bank lifted 9 per cent to $1.2bn, up from $1.1bn in the preceding half.

Compared to a year ago, however, cash profit was down 10.3 per cent from $1.36bn, reflecting lower revenue from rock-bottom interest rates and higher expenses to support customers through the pandemic. This was partly offset by lower bad and doubtful debts.

The net interest margin improved two basis points half-on-half to 2.83 per cent, with credit impairment charges as a percentage of gross loans declining from 20 basis points to seven basis points.

NAB has been investing heavily in its core franchise against a background of strong business confidence and conditions and elevated capacity utilisation.

It has added 490 new roles to the business bank, which will expand to a target of 550 by the end of the financial year.

The new head of the division, Canadian banker Andrew Irvine, who started in the role in September last year, is continuing to focus on simplification and smoother digital processes.

While NAB’s share of the SME market was flat at 26 per cent in the 2020 financial year, it edged up to 26.3 per cent in February.

The business and home-lending pipeline, which measures the value of applications, approvals and acceptances, was 50 per cent higher in March than it was a year ago, as new business transaction account openings spiked 16 per cent.

Mr McEwan said April was an even better month.

“I’m pretty pleased with the results from our business and private bank — we’re seeing a pipeline that we haven’t seen for years and years and years,” he said. “It’s a competitive market but we’re doing very well in this market now.”