NAB sets three year goal to lower costs

National Australia Bank said it set a three year time frame to reduce its cost to income ratio to “globally competitive levels”. In a presentation by NAB’s Australian chief executive, Ahmed Fahour, at an unidentified broker presentation in New York in the middle of last week, it was said that the bank has an internal target to reduce the cost to income ratio to “globally competitive levels” within three years. NAB’s reported cost to income ratio was 57.4 per cent in the March 2005 half, up from 50.8 per cent in the September 2004 half. Fahour predicted returns of capital to shareholders and further growth through acquisitions. Fahour said NAB’s board would take until the March 2006 quarter to decide on its position on capital and acquisitions, and that capital management should become a topic of the board’s agenda again “by May 2006”.