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NAB to reveal sales plan for Yorkshire and Clydesdale banks in UK

NAB aims to sell Clydesdale Bank in the UK. Photo: Erin Jonasson NAB aims to sell Clydesdale Bank in the UK. Photo: Erin Jonasson
National Australia Bank chief executive Andrew Thorburn is expected to set out plans for selling the bank's UK businesses on Thursday, as he seeks to close a troubled chapter in the lender's history.

Under pressure to lay out his strategy for turning around the country's fourth-largest lender, Mr Thorburn is expected to provide fresh details on options for selling the Yorkshire and Clydesdale banks, potentially through an initial public offering.

The details of NAB's strategy will be outlined when the company delivers its full-year profits.

If Mr Thorburn can convince the market NAB has a clear plan for leaving behind its troubled UK operations, which have been dragged down by recession and a mis-selling affair, it would be a significant win for the new chief executive, who took over from Cameron Clyne in August.

While NAB has previously made it clear it would like to exit the UK, it is believed Mr Thorburn will provide additional details on the sales options being considered.

Several analysts say a float of the UK lenders is likely over the next six months, as the British banking IPO market heats up and now that the uncertainty created by Scotland's independence referendum has been removed.

A NAB spokesman would not comment because the bank is in a blackout period in the lead-up to its results.

Thursday's results briefing will be the latest sign of Mr Thorburn seeking to make his mark on the bank, which has been the laggard of the big four over the past decade, in part due to its troubled UK operations.

He is offloading its US business Great Western Bank in an initial public offering, and this month announced hefty write-downs.

Mr Thorburn has also reshuffled his top executive ranks and has signalled a closer focus on core Australian operations, especially the flagship business bank.

Aside from its UK assets, the market will also be seeking details on the outlook for wealth business MLC, including whether its life insurance business will be sold.

"The market is not expecting strong numbers from NAB with this result," UBS analyst Jonathan Mott said. "It is looking for Andrew Thorburn to be a change agent to address its sustained underperformance."

Earlier this month Mr Thorburn announced $1.34 billion in write-downs across NAB, which will weigh on full-year profits, forecast to be $5.1 billion to $5.2 billion, compared with $5.94 billion a year earlier.

About $1 billion of the write-downs related to the UK, where a new remediation process agreed with the UK Financial Conduct Authority in August has forced NAB to reassess complaints by clients mis-sold payment protection insurance.

with James Eyers
Author: Clancy Yeates
Source: Sydney Morning Herald


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