Plain-text annual report
National Australia Bank Limited ABN 12 004 044 937Annual Report 2022 National Australia Bank Limited ABN 12 004 044 937This 2022 Annual Report (Report) is lodged with the Australian Securities and Investments Commission and ASX Limited. National Australia Bank Limited (NAB) is publicly listed in Australia. The Report contains information prepared on the basis of the Banking Act 1959 (Cth), Corporations Act 2001 (Cth), 4th edition ASX Corporate Governance Councilʼs Corporate Governance Principles and Recommendations, Accounting Standards and interpretations issued by the Australian Accounting Standards Board and International Financial Reporting Standards and interpretations issued by the International Accounting Standards Board. It also provides information on the Groupʼs activities and performance in 2022, showing how the Group is creating value through its strategy, operating environment, governance and financial and non-financial activities. NAB also produces a Climate Report which can be viewed online. To view this Report online, visit www.nab.com.au/annualreports. Alternatively, to arrange for a copy to be sent to you free of charge, call the shareholder information line on 1300 367 647 from within Australia or +61 3 9415 4299 from outside Australia. Nothing in the Report is, or should be taken as, an offer of securities in NAB for issue or sale, or an invitation to apply for the purchase of such securities. All figures in the Report are in Australian dollars unless otherwise stated. 2022 Reporting Suite
Acknowledgement of Country
NAB acknowledges Australia’s First Nations people as the Traditional Custodians of the land and their continuing
connection to country, sea and water. We pay respect to their Elders past, present and emerging.
We make this acknowledgement with the ambition to continue supporting a reconciled Australia through our actions and
voice. This is backed by why we are here: to serve customers well and help our communities prosper.
2022 Annual Report
NAB’s 2022 Annual Report provides information on the Group’s activities
and performance during 2022. It outlines how NAB is creating value
through its strategy, operating environment, governance, financial and non-
financial activities. This Report combines content from three previously
separate reports: Annual Financial Report, Annual Review and Corporate
Governance Statement.
The Annual Report draws on aspects of the International Integrated Reporting
Framework. It is supported by the additional documents outlined below.
Report Structure
Pages 11 to 49 contain the Group’s business, strategy, operating environment
and performance. These pages outline performance relevant to customers,
colleagues, climate change and environment, data security and technology,
and communities. Stakeholder feedback was considered in the shaping of this
section (see What matters most on page 23 for more information).
Pages 56 to 80 contain NAB’s 2022 Corporate Governance Statement, which
discloses how the ASX Corporate Governance Council’s ‘Corporate Governance
Principles and Recommendations – 4th edition’ have been complied with.
Pages 95 to 144 contain key components of the Report of the Directors.
Pages 108 to 142 contain the Remuneration Report.
Pages 147 to 244 contain the Financial Report.
Assurance
The Remuneration Report on pages 108 to 142 and Financial Report on pages
147 to 244 have been audited by EY. The assurance statement for the Financial
Report and Remuneration Report is on pages 245 to 252.
EY provides limited assurance over 25 key non-financial sustainability metrics
and performance disclosures and a further seven metrics relating to NAB's
Reconciliation Action Plan as outlined in EY's limited assurance statement on
pages 50 to 55.
KPMG provides assurance over selected environmental measures
disclosed across NAB's reporting suite. KPMG’s assurance statements
are available on NAB's website at nab.com.au/about-us/social-impact/
shareholders/performance-and-reporting.
Additional documents
2022 Full Year Results
Investor Presentation
Information designed
for analysts and
institutional investors
which accompanies
the Group's Full Year
Results Presentation.
Management
Discussion
and Analysis
Management
discussion and
analysis of the
Group's results for
the year ended
30 September 2022.
2022 Climate Report
2022 Pillar 3 Report
Describes the Group's
approach to risk
management and
provides details about
risk exposures, capital
adequacy and liquidity.
Provides stakeholders
with information on
the Group's approach
to climate change
and how it manages
associated risks
and opportunities.
The report uses
the recommendations
of the Financial
Stability Board's Task
Force on Climate-
related Financial
Disclosures (TCFD).
2022 Sustainability
Data Pack
Provides further detail
on the Group's ESG
performance, in addition
to the material themes
covered in the Annual
Report and the
Climate Report.
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2022 Reporting Suite (cont.)
Additional information
Certain definitions
The Group's financial year ends on 30 September. The financial year ended 30 September 2022 is referred to as 2022 and other
financial years are referred to in a corresponding manner. Reference in this document to the year ended September 2022 are
references to the twelve months ended 30 September 2022. Reference in this document to the environmental reporting year are
references to the twelve months ended 30 June 2022.
The abbreviations $m and $bn represent millions and thousands of millions (i.e. billions) of Australian dollars respectively.
Key terms used in this report are contained in the Glossary.
Forward looking statements
This report contains statements that are, or may be deemed to be, forward looking statements. These forward looking
statements may be identified by the use of forward looking terminology, including the terms "believe", "estimate", "plan",
"project", "anticipate", "expect", "goal", “target”, "intend", “likely”, "may", "will", “could” or "should" or, in each case, their negative
or other variations or other similar expressions, or by discussions of strategy, plans, objectives, targets, goals, future events
or intentions. Indications of, and guidance on, future earnings and financial position and performance are also forward
looking statements. You are cautioned not to place undue reliance on such forward looking statements. Such forward looking
statements are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors,
many of which are beyond the control of the Group, which may cause actual results to differ materially from those expressed or
implied in such statements. There can be no assurance that actual outcomes will not differ materially from these statements.
There are a number of other important factors that could cause actual results to differ materially from those projected in such
statements, including (without limitation) a significant change in the Group’s financial performance or operating environment; a
material change to law or regulation or changes to regulatory policy or interpretation; and risks and uncertainties associated
with the ongoing impacts of the COVID-19 pandemic, the Russia-Ukraine conflict and other geopolitical tensions, the Australian
and global economic environment and capital market conditions. Further detail is contained on page 84 under Disclosure on
Risk factors.
Contents
Our business in 2022
2022 at a glance
Chair's message
CEO's message
Creating value
The Group's businesses
Strategy
What we will be known for
Operating environment
Creating value
Sustainability approach
Customers
Colleagues
Climate change and environment
Data security and technology
Helping our communities prosper
Independent limited assurance statement
2
5
6
7
9
11
12
13
17
19
20
25
30
38
42
44
50
Corporate Governance Statement
56
Corporate Governance Framework
Board of Directors
Executive Leadership Team
Key Board activities in 2022
Board composition, diversity and performance
Board committees
How We Work
Assurance and control
Compliance with ASX corporate
governance recommendations
Risk management
Risk management overview
Risk factors
Report of the Directors
Operating and financial review
Directors’ information
Other matters
Remuneration Report
Directors' signatures
Auditor's independence declaration
59
60
64
67
69
74
76
79
80
81
83
84
95
97
106
107
108
143
144
Financial report
Income statements
Statements of comprehensive income
Balance sheets
Statements of cash flows
Statements of changes in equity
Notes to the financial statements
Directors' declaration
Report on the audit of the financial report
Additional information
Glossary
147
148
149
150
151
153
155
244
245
253
261
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2022 Annual Report
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Our business in 2022
This page has been intentionally left blank. 2022 at a glance
Key financial performance measures
Dividend per share (for
the full year)
Common Equity Tier 1
capital ratio
$1.51
$0.24 higher than 2021
11.51%
149 bp decrease
from 2021
Statutory net profit
$6.89bn
8.3% increase from 2021
Cash earnings(1)
$7.10bn
8.3% increase from 2021
Cash return on equity(1)
11.7%
100 bp increase from 2021
Diluted Cash EPS (cents)(1)
211.7
10.8% increase from 2021
Other key performance measures
Net Promoter Score (NPS)
- Consumer(2)(3)
0
#1 among major
Australian banks
NPS - Business(2)(5)
-5
#2 among major
Australian banks
Finance to drive positive
social impact
Colleague
engagement score(9)
$70.8bn
Cumulative environmental
financing (met target of
$70bn by 2025)(7)
76
2 points below top
quartile target score
of 78
NPS - High Net Worth and
Mass Affluent(2)(4)
-5
Equal #1 among major
Australian banks
Relationship Strength
Index - Corporate(6)
#1
Among major
Australian banks
$3.61bn
Cumulative affordable
and specialist housing
financing (met target of
$2bn by 2023)(8)
(1) Full detail on how cash earnings is defined, a discussion of non-cash earnings items and a full reconciliation of statutory net profit attributable to owners of NAB is set
out in Note 2 Segment information of the Financial Report on page 157. Statutory return on equity and statutory earnings per share (EPS) are presented on page 99.
(2) Net Promoter® and NPS® are registered trademarks and Net Promoter Score and Net Promoter Systems are trademarks of Bain & Company, Satmetrix Systems and Fred
Reichheld. NPS results are shown as a six month rolling average to September 2022. Prior year numbers have been restated and not been assured by EY.
(3) Sourced from DBM Consultants Consumer Atlas, results are shown as a six month rolling average to September 2022. A number of changes have been made to our
Strategic NPS measure to align more closely to the Group Strategy. Consumer NPS now excludes consumers with Personal income of $260k+ and/or investible assets
$1m+. Ranking based on absolute scores, not statistically significant differences.
(4) Sourced from DBM Consultants Consumer Atlas, results are shown as a six month rolling average to September 2022. Includes consumers with personal income of
$260k+ and/or investible assets $1m+. Ranking based on absolute scores, not statistically significant differences.
(5) Sourced from DBM Consultants Business Atlas, results are shown as a six month rolling average to September 2022. Business NPS is now based on equal (25:25:25:25)
combined weighting of NAB turnover segments: Micro (Up to $100k turnover), Small ($100k-$5m turnover), Medium ($5m-$50m turnover), Large ($50m+). Ranking based on
absolute scores, not statistically significant differences.
(6) Peter Lee Associates – Large Corporate and Institutional Relationship Banking Survey Australia 2022. Ranking against all banks included in survey.
(7) Represents total cumulative new flow of environmental financing from 1 October 2015. Refer to NAB's 2022 Sustainability Data Pack for a further breakdown of this
number and reference to how progress towards NAB's environmental finance target is calculated.
(8) Affordable and specialist housing includes affordable housing, specialist disability accommodation, sustainable housing. This includes loans made under the First Home
Guarantee, as part of the Home Guarantee Scheme (previously the First Home Loan Deposit Scheme) for properties under the national median house price, and for
borrowers with taxable income below the national median household income. Progress is based on total lending facilities committed, where first drawdown occurred
during the target period. This number does not reflect debt balance. Only the 2022 and 2021 portion of the cumulative progress figure has been assured by EY.
(9) 2022 Heartbeat Survey conducted by Glint, score based on August 2022 survey. Includes Australia and New Zealand colleagues, excludes external contractors,
consultants and temporary colleagues.
2022 Annual Report
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Chair's message
Focus on strength and capability
NAB has continued its journey this year to be a stronger
bank. We have a more focused and capable business. This
has enabled NAB to grow safely while supporting customers
impacted by economic challenges and natural disasters.
Continuity and strength in our leadership and strategy has
underpinned stability. We have also made the business
better. NAB’s products and processes are simpler, benefitting
customers and our people. There remains more to do.
Investment in NAB’s digital, data and analytics capability
is helping us approve loans faster and provide more
reliable digital banking services. Strong technology platforms
protect customers against the escalating threat of cyber-
attacks and fraud. However, we are alert to the need for
continued vigilance.
As we have improved the bank, we have kept the lessons
of the Financial Services Royal Commission and NAB’s self-
assessment front of mind in maintaining a steadfast focus
on culture and risk management. Many of the issues identified
are now behind us, but they constantly remind us to get the
basics right.
Earlier this year we entered into an Enforceable Undertaking
with our anti-money laundering regulator, AUSTRAC. This
follows an enforcement investigation undertaken by AUSTRAC
in relation to NAB’s compliance with Australia’s anti-money
laundering and counter-terrorism financing laws.
We are building better capability and improving controls in
financial crime risk and are on track to deliver the actions
agreed with AUSTRAC.
Building a better bank
NAB is making excellent progress on our strategy and the
Board is encouraged to see the operational results that this
is delivering.
This is reflected in improved earnings with all businesses
contributing to underlying profit growth, and significant and
sustainable momentum across the Group. Our most recent
colleague engagement score is 76, compared with 77 in July
2021, and is close to the latest top quartile score of 78.
Taking all this into account, the Board has determined
dividends for the year of 151 cents per share, returning $4.8bn
in total to shareholders.
Total shareholder return was 8.6 per cent in the 12 months to
September 2022, against an average negative return of 12.9
per cent for NAB’s major bank peers.
Remuneration outcomes determined by the Board for
financial year 2022 reflect an assessment of performance
against all targets in NAB’s 2022 plan, including financial
performance, customer outcomes, colleague engagement
and safe growth. NAB’s performance against peers has also
been reflected in overall remuneration outcomes.
Future readiness
In view of the challenges of recent years, we are cautious as
to what lies ahead. Economies globally are facing new trials
and uncertainty remains. Actions taken by foreign leaders
often have an impact on Australia and New Zealand.
NAB’s leadership has the experience and strategy to manage
the challenges that we face. While we are alert to the issues
that rising interest rates, inflation and geopolitical risks may
bring, we have demonstrated our ability to manage through
this and look after our customers.
The Australian economy is resilient and we are in a strong
position to take on any challenges that arise. Identifying long-
6
National Australia Bank
term shifts in NAB’s broader operating environment and acting
appropriately is critical to protecting and building value for
shareholders and helping our communities prosper.
Climate change is one of – if not the – most significant long-
term challenges and opportunities of our time.
The Federal Government’s legislated 2030 and 2050 emissions
reduction targets and associated changes provide welcome
certainty and send a strong investment signal to businesses
and the world.
At NAB, we’re taking action to address the issue through
what we can control: finance. Our goal is to align our lending
portfolio to net zero emissions by 2050. This year we have set
2030 decarbonisation targets for the intensive priority sectors
of power generation, oil and gas, thermal coal mining and
cement production.
NAB will support its customers through the transition and help
fund the investments required.
Another major opportunity in the year ahead is the prospect
of a national referendum on the Constitutional recognition of
Indigenous Australians. As a bank, we thrive when we operate
in cohesive, well-functioning communities. Recognition is
an important step forward and why NAB is supporting the
proposed Voice to Federal Parliament.
Board renewal
Ensuring your Board is well appointed to carry the bank
forward is a constant focus.
Kathryn Fagg, Doug McKay and I will stand for re-election at the
Annual General Meeting with the full support of the Board and
we are anticipating appointments in 2023 that will enhance the
diverse skills and experience of directors.
On behalf of the Board, thank you for your ongoing support.
To the team at NAB, thank you for your hard work to serve
customers well and help our communities prosper. We’re not
there yet, but we are getting closer to being the bank we want
to be.
Philip Chronican, Chair
Directors' declaration The directors of National Australia Bank Limited declare that: (a) in the opinion of the directors, the financial statements and notes for the year ended 30 September 2022, as set out on pages148 to 244, are in accordance with the Corporations Act 2001 (Cth), including:i) in compliance with Australian Accounting Standards (including Australian Accounting Interpretations), International FinancialReporting Standards as stated in Note 1 Basis of preparation, and any further requirements of the Corporations Regulations2007;andii) give a true and fair view of the financial position of NAB and the Group as at 30 September 2022, and of the performance of NABand the Group for the year ended 30 September 2022.(b)in the opinion of the directors, there are reasonable grounds to believe that NAB will be able to pay its debts as and when theybecome due and payable.( c)the directors have been given the declarations required by section 295A of the Corporations Act 2007 (Cth) for the year ended30 September 2022.Signed in accordance with a resolution of the directors. Philip Chronican Chair 9 November 2022 Ross McEwan CBE Group Chief Executive Officer 9 November 2022 2022 Annual Report 245 ;::;. C C :::JCl'JC 0 u; "-' -"-' ct {f. {f. (!) ll) .... :::J 00 < ll) C (D (/) G) ...... o � (!) (!) -, 3 :::J (I) cg :::J (') .... ;;i :3 0) :J Jg -A (!) iii 3 ;,; (D :::J ...... ,..,.::r(D :J: C)
BNP PARIBAS NOMINEES PTY LTD
CITICORP NOMINEES PTY LIMITED
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
NETWEALTH INVESTMENTS LIMITED
AUSTRALIAN FOUNDATION INVESTMENT COMPANY LIMITED
CPU SHARE PLANS PTY LTD
BNP PARIBAS NOMINEES PTY LTD HUB24 CUSTODIAL SERV LTD
BNP PARIBAS NOMS (NZ) LTD
ARGO INVESTMENTS LIMITED
BNP PARIBAS NOMINEES PTY LTD ACF CLEARSTREAM
WASHINGTON H SOUL PATTINSON AND COMPANY LIMITED
NAVIGATOR AUSTRALIA LTD
NULIS NOMINEES (AUSTRALIA) LIMITED
AUSTRALIAN EXECUTOR TRUSTEES LIMITED
MUTUAL TRUST PTY LTD
Total
Substantial shareholders
Number of
shares
801,947,323
465,154,750
245,757,633
110,796,788
76,026,057
39,958,167
33,193,725
21,200,229
13,267,645
11,154,789
9,076,275
8,070,489
5,951,486
5,934,685
4,638,250
4,180,441
3,672,148
3,545,025
3,452,320
2,478,175
%
25.43
14.75
7.79
3.51
2.41
1.27
1.05
0.67
0.42
0.35
0.29
0.26
0.19
0.19
0.15
0.13
0.12
0.11
0.11
0.08
1,869,456,400
59.28
The following organisations have disclosed a substantial shareholding notice to ASX. As at 14 October 2022, the Company has
received no further update in relation to these substantial shareholdings.
Name
BlackRock Group(1)
State Street Corporation(2)
The Vanguard Group, Inc(3)
(1) Substantial shareholding as at 18 March 2020, as per notice lodged on 20 March 2020.
(2) Substantial shareholding as at 20 July 2022, as per notice lodged on 22 July 2022.
(3) Substantial shareholding as at 1 February 2022, as per notice lodged on 4 February 2022.
Distribution of fully paid ordinary shareholdings
Number of
shares
177,651,034
162,401,728
162,322,845
% of
voting
power
6.02%
5.10%
5.00%
Range (number)
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 and over
Total
Less than marketable parcel of $500
Voting rights
Number of
shareholders
% of
holders
Number of
shares
% of
shares
356,804
185,131
33,175
19,826
450
595,386
15,968
59.93
31.09
5.57
3.33
0.08
100
124,062,387
420,217,781
231,093,124
398,600,902
1,979,839,036
3,153,813,230
107,503
3.93
13.32
7.33
12.64
62.78
100
Each ordinary shareholder present at a general meeting (whether in person or by proxy or representative) is entitled to one vote
on a show of hands or, on a poll, one vote for each fully paid ordinary share held. Holders of partly paid shares voting on a poll are
entitled to a number of votes based upon the proportion that the amount of capital call and paid up on the shares bears to the
total issue price of the shares.
2022 Annual Report
255
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Shareholder information (cont.)
NAB Capital Notes 3 (NCN 3)
Twenty largest holders of NCN 3 as at 14 October 2022
BNP PARIBAS NOMINEES PTY LTD
CITICORP NOMINEES PTY LIMITED
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
NETWEALTH INVESTMENTS LIMITED
NATIONAL NOMINEES LIMITED
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
BNP PARIBAS NOMINEES PTY LTD HUB24 CUSTODIAL SERV LTD
NETWEALTH INVESTMENTS LIMITED
NAVIGATOR AUSTRALIA LTD
NULIS NOMINEES (AUSTRALIA) LIMITED
DIMBULU PTY LTD
MUTUAL TRUST PTY LTD
BNP PARIBAS NOMINEES PTY LTD
CAPI PTY LTD
INVIA CUSTODIAN PTY LIMITED
AUSTRALIAN EXECUTOR TRUSTEES LIMITED
WILLIMBURY PTY LTD
TAVERNERS NO 11 PTY LTD
JDB SERVICES PTY LTD
MARROSAN INVESTMENTS PTY LTD
Total
Distribution of NCN 3 holdings
Range (number)
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 and over
Total
Less than marketable parcel of $500
Voting rights
Number of
securities
3,282,066
1,406,339
1,097,010
407,711
227,537
220,149
204,551
191,800
138,999
127,380
108,500
106,588
97,273
90,000
71,400
67,463
65,609
58,502
53,429
50,000
%
17.51
7.50
5.85
2.18
1.21
1.17
1.09
1.02
0.74
0.68
0.58
0.57
0.52
0.48
0.38
0.36
0.35
0.31
0.29
0.27
8,072,306
43.06
Number of
security
holders
% of
holders
Number of
securities
% of
securities
14,415
1,672
136
64
13
16,300
6
88.44
10.26
0.83
0.39
0.08
100
5,097,712
3,497,265
1,012,503
1,614,772
7,518,330
18,740,582
13
27.20
18.66
5.40
8.62
40.12
100
In accordance with their terms of issue, holders of NCN 3 have no right to vote at any general meeting of NAB prior to conversion
into NAB ordinary shares.
If NCN 3 is converted into NAB ordinary shares in accordance with their terms of issue, then voting rights will be as outlined on
page 255 of this Additional information section for NAB ordinary shares.
256 National Australia Bank
Shareholder information (cont.)
NAB Capital Notes 5 (NCN 5)
Twenty largest holders of NCN 5 as at 14 October 2022
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
CITICORP NOMINEES PTY LIMITED
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
BNP PARIBAS NOMINEES PTY LTD HUB24 CUSTODIAL SERV LTD
NETWEALTH INVESTMENTS LIMITED
NATIONAL NOMINEES LIMITED
BNP PARIBAS NOMINEES PTY LTD
MUTUAL TRUST PTY LTD
G HARVEY INVESTMENTS PTY LTD
NETWEALTH INVESTMENTS LIMITED
NAVIGATOR AUSTRALIA LTD
LEDA HOLDINGS PTY LTD
LONGHURST MANAGEMENT SERVICES PTY LTD
NULIS NOMINEES (AUSTRALIA) LIMITED
VALTELLINA PROPERTIES PTY LTD
BNP PARIBAS NOMINEES PTY LTD
JOHN E GILL TRADING PTY LTD
AM & EM NEXT GEN PTY LTD
DIMBULU PTY LTD
NAVIGATOR AUSTRALIA LTD
Total
Distribution of NCN 5 holdings
Range (number)
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 and over
Total
Less than marketable parcel of $500
Voting rights
Number of
securities
2,029,739
1,931,496
529,271
480,188
417,958
377,306
365,744
226,589
200,000
199,916
160,656
154,000
150,000
133,677
129,200
123,380
107,866
105,000
100,000
86,472
%
8.51
8.10
2.22
2.01
1.75
1.58
1.53
0.95
0.84
0.84
0.67
0.65
0.63
0.56
0.54
0.52
0.45
0.44
0.42
0.36
8,008,458
33.57
Number of
security
holders
% of
holders
Number of
securities
% of
securities
20,546
2,511
173
99
19
23,348
4
88.00
10.75
0.74
0.42
0.08
100
7,510,540
5,134,628
1,247,886
2,147,390
7,819,236
23,859,680
9
31.48
21.52
5.23
9.00
32.77
100
In accordance with their terms of issue, holders of NCN 5 have no right to vote at any general meeting of NAB prior to conversion
into NAB ordinary shares.
If NCN 5 is converted into NAB ordinary shares in accordance with their terms of issue, then voting rights will be as outlined on
page 255 of this Additional information section for NAB ordinary shares.
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2022 Annual Report
257
Shareholder information (cont.)
NAB Capital Notes 6 (NCN 6)
Twenty largest holders of NCN 6 as at 14 October 2022
BNP PARIBAS NOMINEES PTY LTD
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
CITICORP NOMINEES PTY LIMITED
BNP PARIBAS NOMINEES PTY LTD HUB24 CUSTODIAL SERV LTD
NATIONAL NOMINEES LIMITED
NETWEALTH INVESTMENTS LIMITED
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
MUTUAL TRUST PTY LTD
BNP PARIBAS NOMINEES PTY LTD
TANDOM PTY LTD
NETWEALTH INVESTMENTS LIMITED
INVIA CUSTODIAN PTY LIMITED
DIMBULU PTY LTD
ELMORE HOLDINGS PTY LIMITED
FAMILY ENDEAVOURS PTY LTD
BNP PARIBAS NOMINEES PTY LTD ACF CLEARSTREAM
JOHN E GILL TRADING PTY LTD
AUSTRALIAN PROFESSIONAL LEAGUES COMPANY PTY LTD
AUSTRALIAN EXECUTOR TRUSTEES LIMITED
ARKADIA ABSOLUTE FUND PTY LTD
Total
Distribution of NCN 6 holdings
Range (number)
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 and over
Total
Less than marketable parcel of $500
Voting rights
Number of
securities
5,177,970
1,658,308
1,010,016
340,069
279,209
230,328
168,526
125,798
104,712
100,192
57,520
52,370
50,000
50,000
48,500
46,260
44,582
41,000
40,336
36,200
%
25.89
8.29
5.05
1.70
1.40
1.15
0.84
0.63
0.52
0.50
0.29
0.26
0.25
0.25
0.24
0.23
0.22
0.21
0.20
0.18
9,661,896
48.30
Number of
security
holders
% of
holders
Number of
securities
% of
securities
13,911
1,714
139
78
11
15,853
1
87.75
10.81
0.88
0.49
0.07
100
4,465,532
3,624,969
1,026,953
1,687,418
9,195,128
20,000,000
3
22.33
18.12
5.13
8.44
45.98
100
In accordance with their terms of issue, holders of NCN 6 have no right to vote at any general meeting of NAB prior to conversion
into NAB ordinary shares.
If NCN 6 is converted into NAB ordinary shares in accordance with their terms of issue, then voting rights will be as outlined on
page 255 of this Additional information section for NAB ordinary shares.
258 National Australia Bank
Shareholder information (cont.)
Official quotation
Fully paid ordinary shares of the Company are quoted on the ASX.
The Group has also issued:
• NAB Capital Notes 3, NAB Capital Notes 5, NAB Capital Notes 6, NAB Subordinated Notes 2, covered bonds and residential
mortgage backed securities which are quoted on the ASX.
• Medium-term notes, subordinated notes and covered bonds which are quoted on the Luxembourg Stock Exchange.
• Medium-term notes which are quoted on the NZX Debt Market.
• Medium-term notes and covered bonds which are quoted on the SIX Swiss Exchange.
• Medium-term notes which are quoted on the Taipei Exchange.
Unquoted securities
NAB has the following unquoted securities on issue as at 31 October 2022:
•
11,568 partly paid ordinary shares, of which there are 16 holders
• 2,574,286 rights, of which there are 56 holders (see page 107 of this report for further details).
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2022 Annual Report
259
Principal Share Register
Computershare Investor Services Pty Limited
Yarra Falls
452 Johnston Street
ABBOTSFORD VIC 3067
Australia
Postal address:
GPO Box 2333
MELBOURNE VIC 3001
Australia
Local call: 1300 367 647
Fax: +61 3 9473 2500
Telephone and fax (outside Australia):
Tel: +61 3 9415 4299; Fax: +61 3 9473 2500
Email: nabservices@computershare.com.au
Website: www.investorcentre.com/au
United Kingdom Share Register
Computershare Investor Services plc
The Pavilions
Bridgwater Road BRISTOL BS99 6ZZ
United Kingdom
Tel: +44 370 703 0197
Fax: +44 370 703 6101
Email: nabgroup@computershare.co.uk
Website: www.investorcentre.com/au
United States ADR Depositary, Transfer Agent and Registrar
contact details for NAB ADR holders:
Deutsche Bank Shareholder Services
American Stock Transfer & Trust Company Operations Center
6201 15th Avenue
Brooklyn, NY 11219
USA
Toll-free number: +1 866 706 0509
Direct Dial: +1 718 921 8137
Email: db@amstock.com
Contact details for NAB ADR brokers &
institutional investors:
US Tel: +1 212 250 9100
UK Tel: +44 207 547 6500
Email: adr@db.com
Chair
Mr Philip Chronican
BCom (Hons), MBA (Dist), GAICD, SF Fin
Group Chief Executive Officer and Managing Director
Mr Ross McEwan CBE
BBus
Group Chief Financial Officer
Mr Gary Lennon BEc (Hons), FCA
Registered office
Level 28
395 Bourke Street
MELBOURNE VIC 3000
Australia
Tel: 1300 889 398
Tel: +61 3 8872 2461
International locations
www.nab.com.au/corporate/global-relationships
Auditor
Ernst & Young
8 Exhibition Street
MELBOURNE VIC 3000
Australia
Tel: +61 3 9288 8000
Company Secretary
Mrs Louise Thomson BBus (Dist), FGIA
Group Investor Relations
National Australia Bank Limited
Level 2
2 Carrington Street
SYDNEY NSW 2000
Australia
Email: investorrelations@nab.com.au
Social Impact
National Australia Bank Limited
Level 21
395 Bourke Street
MELBOURNE VIC 3000
Australia
Email: social.impact@nab.com.au
Shareholder Centre website
The Group’s website at www.nab.com.au/shareholder has a
dedicated separate section where shareholders can gain
access to a wide range of information, including copies of
recent announcements, annual financial reports as well as
extensive historical information.
Shareholder information line
There is a convenient 24 hours a day, 7 days a week automated
service. To obtain the current balance of your securities and
relevant payment details, telephone 1300 367 647 (Australia) or
+61 3 9415 4299 (outside Australia).
These services are secured to protect your interests. In all
communications with the Share Registry, please ensure you
quote your Securityholder Reference Number (SRN), or in case
of broker sponsored shareholders, your Holder Identification
Number (HIN).
260 National Australia Bank
Glossary
12-month expected credit losses (ECL)
The portion of lifetime expected credit losses
that represent the expected losses arising
from default events that could occur within 12
months of the reporting date.
86 400
86 400 refers to 86 400 Holdings Limited,
86 400 Pty Ltd and 86 400 Technology Pty Ltd,
the entities acquired by the Group in May 2021.
90+ days past due (DPD) and gross impaired
assets to GLAs
Calculated as the sum of ‘90+ DPD assets’ and
‘Gross impaired assets’, divided by gross loans
and acceptances.
90+ DPD assets
90+ DPD assets consist of assets that are
contractually 90 days or more past due, but
not impaired.
AASB
Australian Accounting Standards Board.
Accountable Person
An accountable person for the purposes of
the Banking Act 1959 (Cth).
ADI
Authorised Deposit-taking Institution.
ADR
American Depositary Receipt.
AGM
Annual General Meeting of National Australia
Bank Limited.
AML
Anti-Money Laundering.
Annual Variable Reward (VR)
An 'at risk' opportunity for individuals
to receive an annual performance-based
reward. The actual VR that an individual will
receive in any particular year will reflect both
business and individual performance.
APRA
Australian Prudential Regulation Authority.
APS
Prudential Standards issued by APRA
applicable to ADIs.
ASIC
Australian Securities and
Investments Commission.
ASX
Australian Securities Exchange Limited (or the
market operated by it).
AUSTRAC
Australian Transaction Reports and
Analysis Centre.
Available stable funding (ASF)
The portion of an ADI's capital and liabilities
expected to be reliably provided over a one-
year time horizon.
Average equity (adjusted)
Average equity adjusted to exclude
non-controlling interests and other
equity instruments.
Average interest earning assets
The average balance of assets held by
the Group over the period that generate
interest income.
Bank levy
A levy imposed under the Major Bank Levy Act
2017 (Cth) on ADIs with total liabilities of more
than $100 billion.
Basel III
Basel III is a global regulatory framework
designed to increase the resilience of banks
and banking systems and was effective for
ADIs from 1 January 2013.
BBSW
Bank Bill Swap Rate.
BEAR
Banking Executive Accountability Regime.
BEAR Accountable Person
For the purposes of BEAR, NAB has registered
certain individuals (the directors, Group
Executives, Executive Internal Audit and
Executive Group Money Laundering Reporting
Officer) as ‘Accountable Persons’ with APRA.
BKBM
New Zealand's Bank Bill Benchmark Rate.
BNZ
Bank of New Zealand.
BNZ Life
BNZ Life was the Group's New Zealand life
insurance business operating as BNZ Life.
The sale of BNZ Life to New Zealand life
insurance provider Partners Life completed on
30 September 2022.
Business lending
Lending to non-retail customers including
overdrafts, asset and lease financing, term
lending, bill acceptances, foreign currency
loans, international and trade finance,
securitisation and specialised finance.
Cash earnings
Cash earnings is defined as net profit
attributable to owners of NAB from continuing
operations, adjusted for the items NAB
considers appropriate to better reflect the
underlying performance of the Group. Cash
earnings for the September 2022 financial
year has been adjusted for the following:
•
•
•
hedging and fair value volatility
amortisation of acquired intangible assets
acquisitions, disposals and
business closures.
Cash net interest income (Cash NII)
Cash NII is derived from statutory net interest
income, including management adjustments
for fair value hedge ineffectiveness and
a reclassification of income from the NAB
Wealth Business that management considers
better reflected in net interest income for
their purposes. In these financial statements,
there is no material difference between Cash
NII and statutory net interest income.
Cash return on equity (cash ROE)
Cash earnings after tax expressed as a
percentage of average equity (adjusted).
CGU
Cash-generating unit.
Citi consumer business
Citi consumer business refers to Citigroup's
Australian consumer business, acquired by
the Group in June 2022.
Citigroup
Citigroup Pty Limited and Citigroup Overseas
Investment Corporation.
Committed Liquidity Facility (CLF)
A facility provided by the RBA to certain
ADIs to assist them in meeting the Basel III
liquidity requirements.
Common Equity Tier 1 (CET1) capital
CET1 capital ranks behind the claims of
depositors and other creditors in the event
of winding-up of the issuer, absorbs losses
as and when they occur, has full flexibility of
dividend payments and has no maturity date.
CET1 capital consists of the sum of paid-up
ordinary share capital, retained profits plus
certain other items as defined in APS 111
Capital Adequacy: Measurement of Capital.
Common Equity Tier 1 capital ratio
CET1 capital divided by risk-weighted assets.
Company
National Australia Bank Limited (NAB) ABN 12
004 044 937.
Continuing operations
Continuing operations are the components
of the Group which are not
discontinued operations.
Core assets
Represents gross loans and advances
including acceptances, financial assets at
fair value, and other debt instruments at
amortised cost.
CO2-e (carbon dioxide equivalent)
The common unit of measure for the
expression of Greenhouse Gas (GHG)
emissions. Each unit of GHG has a different
global warming potential. Therefore, all
greenhouse gases are converted back
to tonnes (tCO2-e) of carbon dioxide
equivalent to enable consistent comparison
and measurement.
CQiB
Career Qualified in Banking program.
CTF
Counter-Terrorism Financing.
Customer deposits
The sum of interest bearing, non-interest
bearing and term deposits (including retail
and corporate deposits).
Customer Funding Index (CFI)
Customer deposits (excluding certain short
dated institutional deposits used to fund liquid
assets) divided by core assets.
CYBG
Virgin Money UK PLC (formerly CYBG PLC).
D-SIB
Domestic Systemically Important Banks.
Dilutive potential ordinary share
A financial instrument or other contract
that may entitle its holder to ordinary
shares and which would have the effect of
decreasing earnings per share. For the Group,
these include convertible preference shares,
convertible notes and shares issued under
employee incentive schemes.
Discontinued operations
Discontinued operations are a component
of the Group that either has been disposed
of, or is classified as held for sale, and
represents a separate major line of business
or geographical area of operations, which is
part of a single coordinated plan for disposal.
Distributions
Payments to holders of equity instruments
other than ordinary shares, including National
Income Securities.
DLP
Distinctive Leadership program.
EaR
Earnings at risk.
Earnings per share (EPS) - basic
Calculated as net profit attributable to
ordinary equity holders of the parent
(statutory basis) or cash earnings (cash
earnings basis), divided by the weighted
average number of ordinary shares.
Earnings per share (EPS) - diluted
Calculated as net profit attributable to
ordinary equity holders of the parent
(statutory basis) or cash earnings (cash
earnings basis), divided by the weighted
average number of ordinary shares, after
adjusting both earnings and the weighted
average number of ordinary shares for the
impact of dilutive potential ordinary shares.
Economic adjustments
The economic adjustment forms part of the
provision for credit impairment derived from
reasonable and supportable forecasts of
potential future conditions (forward looking
information) that is not captured within the
underlying credit provision. It incorporates
general macro-economic forward looking
information (for example, GDP, unemployment
and interest rates).
2022 Annual Report
261
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Enforceable Undertaking (EU)
An enforceable undertaking under subsection
197(1) of the Anti-Money Laundering and
Counter-Terrorism Financing Act 2006 (Cth)
entered into between NAB and AUSTRAC on
29 April 2022, in relation to concerns identified
by AUSTRAC with the Group's compliance with
certain AML and CTF requirements which
were the subject of a formal investigation
by AUSTRAC.
Environmental reporting year
Environmental reporting period from 1 July to
30 June. Aligned with the National Greenhouse
and Energy Reporting Act 2007 (Cth).
Executive Leadership Team (ELT)
Executive Leadership Team means the Group
CEO and the Group Executives.
Fair value
The price that would be received to sell an
asset or paid to transfer a liability in an orderly
transaction between market participants at
measurement date.
Fair value (for the purposes of equity
awards set out in the Remuneration Report)
The value of the awards provided are
measured by reference to the grant date fair
value of the shares and performance rights
provided to employees. The grant date fair
value of each share is determined by the
market value of NAB shares, and is generally
a five-day weighted average share price. The
fair value of the shares and performance
rights with market performance hurdles is
determined using a simulated version of the
Black-Scholes model.
FINSIA
Financial Services Institute of Australasia.
Fixed Remuneration (FR)
Base salary and superannuation paid regularly
during the year.
Forward looking adjustments (FLAs)
Forward looking adjustments reflect part
of the provision for credit impairment
derived from reasonable and supportable
forecasts of potential future conditions
(forward looking information) that are not
otherwise captured within the underlying
credit provision or the economic adjustment.
They incorporate more targeted sector-
specific forward looking information.
Full-time equivalent employees (FTEs)
Includes all full-time, part-time, temporary,
fixed term and casual employee equivalents,
as well as agency temporary employees and
external contractors either self-employed
or employed by a third party agency. Note:
this excludes consultants, IT professional
services, outsourced service providers and
non-executive directors.
Greenhouse gas (GHG) emissions
Gaseous pollutants released into the
atmosphere that amplify the greenhouse
effect. Gases responsible include
carbon dioxide, methane, nitrous oxide,
hydrofluorocarbons, perfluorocarbons and
sulphur hexafluoride.
Gross Domestic Product (GDP)
GDP is the market value of finished goods and
services produced within a country in a given
period of time.
Gross loans and acceptances (GLAs)
Total loans, advances and acceptances,
including unearned and deferred fee income,
excluding associated provisions for expected
credit losses. Calculated as the sum of
'Acceptances', 'Loans and advances at
fair value’ and ‘Loans and advances at
amortised cost’.
Group
NAB and its controlled entities.
Group Executives
The Executive Leadership Team, excluding the
Group CEO.
262 National Australia Bank
Group Performance Indicators (GPI)
A scorecard of financial and non-financial
performance measures linked to the Group’s
key strategic priorities, overlaid by a
qualitative assessment. The GPI is used to
assess the Group’s performance for the
purpose of the Annual VR Plan.
Hedging and fair value volatility
This volatility represents timing differences
between the unrealised gains or losses
recognised over the term of the transactions
and the ultimate economic outcome which
will only be realised in future. This volatility
arises primarily from fair value movements
relating to trading derivatives held for risk
management purposes; fair value movements
relating to assets, liabilities and derivatives
designated in hedge relationships; and fair
value movements relating to assets and
liabilities designated at fair value.
HICAPS
Health Industry Claims and Payments Service.
High-quality liquid assets (HQLA)
Consists primarily of cash, deposits with
central banks, Australian government and
semi-government securities and securities
issued by foreign sovereigns as defined in APS
210 Liquidity.
Housing lending
Mortgages secured by residential properties
as collateral.
IBOR
Interbank Offered Rates.
IFRS
International Financial Reporting Standards
as issued by the International Accounting
Standards Board (IASB).
Impaired assets
Consists of:• Retail loans (excluding
unsecured portfolio managed facilities) which
are contractually 90 days or more past
due with security insufficient to cover
principal and interest or where sufficient
doubt exists about the ability to collect
principal and interest in a timely manner.•
Non-retail loans which are contractually past
due and / or where there is sufficient
doubt the ability to collect principal and
interest.• Off-balance sheet credit exposures
where current circumstances indicate that
losses may be incurred.• Unsecured portfolio
managed facilities that are 180 days or more
past due (if not written off).
Internal ratings-based (IRB)
The process used to estimate credit risk
through the use of internally developed
models to assess potential credit losses
using the outputs from the probability of
default, loss given default and exposure at
default models.
Key Management Personnel (KMP)
NAB's Key Management Personnel (KMP) is
assessed each year and comprises the non-
executive directors of NAB, the Group CEO
(an executive director of NAB) and those
employees of the Group who have authority
and responsibility for planning, directing and
controlling the activities of both NAB and
the Group.
LanternPay
LanternPay is a digital health claiming
technology business operated by Lantern
Claims Pty Ltd (Lantern Claims), acquired by
the Group on 1 April 2022.
Leverage ratio
Tier 1 capital divided by exposures as defined
by APS 110 Capital Adequacy. It is a simple,
non-risk based measure to supplement
the risk-weighted assets based capital
requirements. Exposures include on-balance
sheet exposures, derivative exposures,
securities financing transaction exposures
and other off-balance sheet exposures.
Lifetime expected credit losses (ECL)
The ECL that result from all possible
default events over the expected life of a
financial instrument.
Liquidity Coverage Ratio (LCR)
A metric that measures the adequacy of
HQLA available to meet net cash outflows
over a 30-day period during a severe liquidity
stress scenario.
Long Term Variable Reward (LTVR)
An 'at risk' opportunity for the ELT to receive
a long-term performance-based reward,
vesting after a four-year performance period
subject to the applicable performance hurdle.
The actual LTVR that an individual will receive
on vesting will reflect achievement of the
performance hurdle.
MLC Life
MLC Limited.
MLC Wealth
MLC Wealth was the Group’s Wealth division
which provided superannuation, investments,
asset management and financial advice to
retail, corporate and institutional clients,
supported by several brands including MLC,
Plum and investment brands under MLC
Asset Management. The sale of MLC Wealth
to Insignia Financial Ltd completed on
31 May 2021.
NAB
National Australia Bank Limited ABN 12 004
044 937.
NAB risk management
Management of interest rate risk in the
banking book, wholesale funding and liquidity
requirements and trading market risk to
support the Group’s franchises.
nabtrade
National Australia Bank’s online
investing platform.
Net interest margin
Net interest income derived on a cash
earnings basis expressed as a percentage of
average interest earning assets.
Net Promoter Score (NPS)
Net Promoter® and NPS® are registered
trademarks, and Net Promoter Score and
Net Promoter System are trademarks of Bain
& Company, Satmetrix Systems and Fred
Reichheld. Net Promoter Score measures the
likelihood of a customer's recommendation
to others.
Net Stable Funding Ratio (NSFR)
A ratio of the amount of available stable
funding (ASF) to the amount of required stable
funding (RSF).
NZBA
Net Zero Banking Alliance.
Official Cash Rate
Official Cash Rate is an interest rate set by the
Reserve Bank of New Zealand.
RBA
Reserve Bank of Australia.
RBNZ
Reserve Bank of New Zealand.
Required stable funding (RSF)
The amount of stable funding an ADI is
required to hold measured as a function
of the liquidity characteristics and residual
maturities of the various assets held by an ADI,
including off-balance sheet exposures.
Risk-weighted assets
A quantitative measure of risk required by the
APRA risk-based capital adequacy framework,
covering credit risk for on and off-balance
sheet exposures, market risk, operational risk
and interest rate risk in the banking book.
RMBS
Residential Mortgage Backed Securities.
Total Shareholder Return (TSR)
The return that a shareholder receives
through dividends (and any other
distributions) together with capital gains over
a specific period.
Treasury shares
Shares issued to meet the requirements of
employee incentive schemes which have not
yet been distributed.
Underlying profit / loss
Underlying profit / loss is a performance
measure used by NAB. It represents cash
earnings / loss before various items,
including income tax expense and the
credit impairment charge. It is not a
statutory financial measure and is not
presented in accordance with Australian
Accounting Standards.
UNEP FI Guidelines
United Nations Environment Programme
Finance Initiative Guidelines for Climate Target
Setting for Banks.
Value at Risk (VaR)
A mathematical technique that uses
statistical analysis of historical data to
estimate the likelihood that a given portfolio’s
losses will exceed a certain amount.
Weighted average number of
ordinary shares
The number of ordinary shares outstanding
at the beginning of the period, adjusted by
the number of ordinary shares bought back
or issued during the period multiplied by
a time-weighting factor. The time-weighting
factor is the number of days that the shares
are outstanding as a proportion of the total
number of days in the period.
Royal Commission
The Royal Commission into Misconduct
in the Banking, Superannuation and
Financial Services Industry established on
14 December 2017 by the Governor-General
of the Commonwealth of Australia to
conduct a formal public inquiry into Australian
financial institutions.
Securitisation
Structured finance technique which involves
pooling, packaging cash flows and converting
financial assets into securities that can be
sold to investors.
SME
Small and medium-sized enterprises.
Stable Funding Index (SFI)
Term Funding Index (TFI) plus Customer
Funding Index (CFI).
Standardised approach
An alternative approach to the assessment
of credit risk which utilises regulatory
prescribed risk-weights based on external
ratings and / or the application of specific
regulator defined metrics to determine risk-
weighted assets.
Standardised Measurement Approach (SMA)
An approach used to calculate the capital
requirement for operational risk based on
a business indicator, a financial statement
proxy of operational risk exposure. This
approach was applied by the Group from
1 January 2022.
Statutory net profit
Net profit attributable to owners of NAB.
Statutory return on equity
Statutory earnings after tax expressed as
a percentage of average equity (adjusted),
calculated on a statutory basis.
Structured entity
An entity created to accomplish a narrow
well-defined objective (e.g. securitisation of
financial assets). A structured entity may take
the form of a corporation, trust, partnership
or unincorporated entity. Structured entities
are often created with legal arrangements
that impose strict limits on the activities of
the structured entity.
TCFD
The Financial Stability Board Task Force on
Climate-related Financial Disclosures.
Term Funding Index (TFI)
Term wholesale funding with remaining
maturity to first call date greater than 12
months, including Term Funding Facility (TFF)
drawdowns divided by core assets.
Tier 1 capital
Tier 1 capital comprises CET1 capital and
instruments that meet the criteria for
inclusion as Additional Tier 1 capital set out
in APS 111 Capital Adequacy: Measurement
of Capital.
Tier 1 capital ratio
Tier 1 capital divided by risk-weighted assets.
Tier 2 capital
Tier 2 capital comprises other components
of capital that, to varying degrees, do not
meet the requirements as Tier 1 capital
but nonetheless contribute to the overall
strength of an ADI and its capacity to
absorb losses.
Top quartile engagement
Top quartile comparison is based upon Glint’s
client group (domestic and global, from
all industries).
Total average assets
The average balance of assets held by
the Group over the period, adjusted for
discontinued operations.
Total capital
Tier 1 capital plus Tier 2 capital.
Total capital ratio
Total capital divided by risk-weighted assets.
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2022 Annual Report
263
www.nab.com.au/shareholderThe cover of this publication is printed on Revive Laser paper stock. Revive Laser is 100% Recycled, manufactured from Forest Stewardship Council® (FSC®) Recycled certified fibre and manufactured carbon neutral. It is produced by an ISO14001 (environmental management system) certified mill. No chlorine bleaching occurs in the recycling process. The text of this publication is printed on Sumo Laser paper stock. Sumo Laser is an environmentally responsible paper manufactured under the ISO14001 Environmental Management System, using elemental chlorine free pulp. Sumo Laser is FSC® Certified Mix pulp. The printer’s operation is accredited to ISO 14001 and ISO 9001 (quality management system) standards and holds FSC® (chain of Custody) certification.This publication is fully recyclable, please dispose of wisely. Emissions generated from the production of this Annual Report have been offset. Offsets corresponding to 8,401kg of CO2-e have been retired. © 2022 National Australia Bank Limited ABN 12 004 044 937 AFSL and Australian Credit Licence 230686 A170520-1022
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