HNW advice, private bankers deliver for NAB

National Australia Bank’s half-year results have elegantly explained why the major banks are content to stay out of mainstream financial advice provision and remain focused on high net worth (HNW) customers.

Within those results, NAB pointed to its “Integrated Private Wealth offering” – noting that its integrated offer was “bringing together banking, investments and advice for high net worth customers”.

The performance of NAB’s private wealth offering comes against the background of suggestions that the Quality of Advice Review (QAR) final recommendations will open the way for the re-entry of banks into advice provision.

However, the NAB results suggest that it will remain focused on high net worth and sophisticated clients notwithstanding is ability to continue delivering general advice.

The investor briefing documents attaching to the NAB half-year result pointed to the HNW segment being covered off by the NAB Private Bank and JB Were and cited 14.5% growth in deposits to $38.7 billion and JB Were funds under management (FUM) having grown 10% per cent to $45.6 billion.

Just as importantly, the results showed that Business and Private Banking accounted for $1.714 billion or 42% of NAB’s first half cash earnings  – an 8.2% increase over the same time last year.

NAB reported a statutory net profit of $3,967 million for the half on the back of earnings of $4,070 million.

The board declared a dividend of 80 cents per share