National Australia Bank (ASX:NAB) reported a 2% rise in third-quarter cash earnings to A$1.83 billion, supported by lower credit impairment charges and continued lending and deposit growth, but warned that customers face mounting economic uncertainty.
The bank said its unaudited cash earnings for the quarter were 2% higher than the first-half quarterly average, excluding the impact of a significant notable item recorded earlier in the year. Statutory net profit rose 32% to A$1.81 billion.
NAB said elevated domestic interest rates, recent tax changes in the Australian federal budget and ongoing geopolitical uncertainty, including the conflict in the Middle East, were creating a more challenging environment for customers.
Despite those pressures, Australian business lending increased 2% during the quarter, driven partly by a 4% rise in Business & Private Banking. Total customer deposits also grew 2%.
Revenue increased 2% from the first-half quarterly average, while underlying profit remained broadly stable. Net interest margin declined by two basis points to 1.79%, although NAB said it improved when the impact of Markets & Treasury was excluded.
The lender said it remained well capitalised, with a Common Equity Tier 1 ratio of 11.93%, comfortably above its operating target of more than 11.25%.
NAB also reaffirmed its FY2026 target of delivering more than A$450 million in productivity savings. Operating expense growth is expected to remain below the 4.6% increase recorded in FY2025.
The bank said it would continue to focus on volume growth and its strategic priorities while navigating the uncertain economic environment.
