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Published: Fri, November 03, 2017
Economy | By Melissa Porter

Morrison calls for NAB to explain job cuts

Morrison calls for NAB to explain job cuts

NAB also announced changes to its executive leadership team, with Managing Director and CEO of Bank of New Zealand being appointed Chief Customer Officer of Business and Private Banking, replacing Angela Mentis who will take on Anthony Healy's role.

Cash profit, the financial industry's preferred measure which strips out volatile items, was up 2.5 percent at AU$6.64 billion, in line with expectations.

NAB delivered a $5.3 billion statutory net profit for the year and cash earnings were up by 2.5 per cent to $6.6 billion.

One-off restructuring costs related to the redundancies of between AU$500 million and AU$800 million are expected to appear in the bank's first-half results next year. The shares are up just over 7% for the year so far.

The aggressive restructuring comes amid a global push by banks to eke out better returns through tight control of costs and replacing staff with improved technology.

The 6,000 workers represent 18% of the bank's 33,400 workforce and many of them will have to partake in various training options to find a new job.

"Detail is light on how the bank has determined that 6,000 jobs are to be cut, and where and when", Angrisano said in a statement.

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".

The bank released an upbeat outlook, underpinned by an anticipated upswing in business investment and government infrastructure spending, raising questions among analysts and investors whether it was too optimistic. "And I think it's important we face into that and we have a clear plan and we talk with our people about it".

Some 6000 NAB employees will be made redundant over the next three years as the bank simplifies its structure, automates more processes and increasingly focuses on digital channels.

That makes a steady full year payout of $1.98 a share and follows the decision by the ANZ next week to leave its dividends unchanged for the final half and full year.

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