NAB has just released 1H23 results and they are a slight miss with lower-than-expected Net Interest Margins (NIM) the main driver. 1H23 Cash earnings of $4.07bn were up 17% however that compared to $4.18bn expected (-2.6% miss) thanks to a NIM of 1.77% versus 1.83% expected. That resulted in 1H Dividend of 83cps, up from 73cps in 1H22, but a tick below the consensus of 84cps. While margins are expanding (+0.14%) due to higher interest rates, some of the benefit is being eroded by competition for mortgages and deposits. Asset quality and capital levels remain very strong, NAB saying that 90-day arrears reduced by 0.9% to just 0.66% driven by improvement in home lending, although they did say arrears in their business lending had increased.
- All up, a touch weak, but not a disaster. The stock should be down, but not by a lot.
MM remains long NAB in our Flagship Growth & Income Portfolios
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