Published: Fri, November 03, 2017
Markets | By Erika Turner

National Australia Bank cuts 6000 jobs

National Australia Bank cuts 6000 jobs

Since taking over as chief executive in late 2014, Andrew Thorburn has spun off and listed CYBG PLC (CYBG.LN), a company housing Clydesdale and Yorkshire Bank in the United Kingdom, sold an 80% stake in its insurance arm and also listed regional US lender Great Western Bancorp Inc.

The accelerated strategy involves an estimated $1.5 billion increase in investment to 2020 with an aim to further improve customer experience, reshape the workforce and grow the bank.

Up to 6,000 jobs are to be axed in a major restructuring at National Australia Bank, the lender said yesterday, after posting A$5.28 billion (US$4.07 billion) in annual net profits.

NAB expects to take a one-off impairment charge of up to $800 million as part of the restructure and invest an additional $1.5 billion in preparing the bank for a new era of competition.

NAB is following in the footsteps of Nordea Bank and Japan's Mizuho Bank, both of which announced job cuts this week.

Thorburn highlighted the bank will happily retrain those who have the aptitude and commitment to do so, though he said that numerous job cuts will be in more "traditional" areas of the bank.

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According to Thorburn, NAB's "real sweet spot" is SMEs, "customers of say $50 million $75 million turnover" and "that's really where we're going to be focusing".

NAB shares ended 2.83 percent lower at AU$31.95.

"Some of our people will leave the bank, and we are announcing a new program, The Bridge, to support them", he said.

The decision comes as it's also revealed the bank made a net profit of $5.3billion - up 1,400 per cent from 2016.

Many thought the outlook too rosy after rival ANZ Banking Group said last month that revenue growth was becoming harder to achieve and the NAB shares fell.

'We've come from a position of strength and now we look out three-to-five years and we want to lay out that plan, ' he said. It settled a case with Australia's corporate regulator last week over possible fixing of the country's benchmark interest rate.

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