Comprehensive Report on the National Australia Bank Banking System

This report provides a comprehensive analysis of the National Australia Bank (NAB) banking system. It begins with an overview of NAB's operations, including its network, employee base, and customer reach, along with a focus on its business units like Business and Private Banking, Consumer and Wealth Banking, and Corporate and Institutional Banking. The report highlights NAB's customer-centric approach, detailing investments in enhancing customer relations, improving digital platforms, and reducing operational risks. It then examines the role of government intervention in the banking sector, emphasizing the importance of regulations for ethical business practices. The report also discusses recent controversies faced by NAB, including accusations of unethical practices and regulatory actions, and references key sources like the Hayne report. The analysis covers NAB's financial performance, ethical considerations, and its compliance with Australian regulations.

Report on NAB Banking System
Report on NAB Banking System
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Report on NAB Banking System
Answers.
A)
National bank of Australia has its network in more than 900 locations. It has more than
33000 employees and approximately 584000 shareholders. It is servicing more than nine million
customers. It has its operating office in new Zealand, Asia, United kingdom, United states and is
planning to expand in Asian counties.
The advent of banking reform in Australia has brought the concept of customer satisfaction
on all levels. The relation between the NAB bank and its clients is a mutually beneficial
relationship. They are benefited on the both ends that can be examined by looking at the data
below:
The group is operating in by focusing in:
 Business and Private Banking – They focuses on the retail business for the costumer of
small to medium class as it helps them in serving their basic banking function. They serve their customer by the integrated banking model managed by the banking
centre business partner or by the small business hubs. They serve the high net worth customers through the private banking and JBwere. They
have specialist in Government, education and community franchising (GECF). The consumer and wealth banking comprises of NAB and UBank consumer banking
section of the wealth division of the Advice, Asset Management and Superannuation. The wealth division provides the customers with independent advisors, mortgage broker,
financial planners and advisors for all kind of assistance.

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Report on NAB Banking System
 Corporate and institutional banking have a wide range of lending and transactional
product like the financial debt capital market, custody investment and specialized capital
(Epstein, 2018).
NAB is customer focused business unit they invest huge amount in enhancing the customer
and banking relation. They have made some plans and policies for strengthening the customer
and bank relation. They are planned to spend 405 billion dollar to increase the customer base
investment to 1.5 billion dollars. Maintain a cost to income ratio to be 35%.The increased
investment on the four key areas outlined below:
Best business bank: They are constantly investing in the Australian Small and Medium
Enterprise (SME) franchise to make it reachable to large number of customer. A new service hub
has been created for metropolitan based small business customers. They are operation all the
seven days to give assistance to the customers. Improved digital platform has made it viable to
transact in 30 minutes rather than 8 days. The time to open a lending account for small business
decreased to 10 mins increasing the operational base of customer by 35%.
Operational and regulatory risks: They are focused to reduce the regulatory and operational
risks by reducing the number of products to 495 only. Increasing the digital oriented products by
19%. They have reached a milestone by reducing the time to open the accounts from 48 hrs to
only 7 minutes. Due to the new 805 operating smart ATMS the on counter rollout time has
reduced by 40%. The organizational layer has be brushed and reduced to 7 layers between the
customer and the CEO.

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Report on NAB Banking System
Culture of the bank: They keep evaluating their employees and train them according to the
requirements. More than 350 employees engaged in the talent programs. They encourage their
employees to go for higher education which has seen a rise of 27%.
Wealth management reshaping: To best serve its high net worth clients they have redesigned
the investment strategies. They will be by retaining and investing in wealth management
offering. They made expected arrangements between NAB and MLC to offer NAB so that
customers continued access to advice and products get their wealth management needs.
Developed Nabtrade, online investing platform that supports self-directed customers.
Following the proper customer and banking relation has increased net profit has increased
by $269 million, The net income for the interest earned increased by $323 million. The increase
of $569 million profit in both housing and business lending volumes. Other income increased by
$754 million including an increase of $246 million fair value hedging in net interest income, and
customer related remediation of $249 million (Nab.com.au, 2019).
B)
Yes government intervention is required to manage and guide such a huge institution
which is dealing in money. A banking system is a large and open enterprise where the business
deals in transaction between customer s and clients. The regulation keeps the laws and rule in
place and making banking experience legal, ethical and beneficial to both the banker and the
clients. The regulators taken following actions to follows an ethical business:

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Report on NAB Banking System
The group follows and tries to achieve the achieve Australian Prudential Regulation Authority's
(APRA) by keeping all the ratios in accordance to it. They follow the Net Stable Funding Ratio
(NSFR) and the quarterly average Liquidity Coverage Ratio (LCR) as per the guidelines. The
ratio of loan for more than 90 days has been kept stable on accordance to the lending regulations
by banking Australian Prudential Regulation Authority (APRA) and Australian Securities and
Investments Commission (ASIC) (Dalton, 2017). NAB has to follow Corporations Act 2001
(Cth) and Australian Accounting Standards and is audited by the auditors in accordance with
Australian Auditing Standards to publish its financial performance information. Following the
Governmental rules keep the bank performing legal and ethical business (Ellis and Littrell, 2017).
C).
In the recent years the banking sectors has faced charges for manipulation, mis conduct
and unethical practices. NAB was in news for two or more events. One of the events was the
accusation from OXFAM that NAB along with 3 more banks was involved in lending to the
companies that have got involved in illegal logging, forced evictions, inadequate compensation
and child labor in less developed countries (NewsComAu, 2019).
NAB was involved in unethical practices such as charging fees for no service even from
the dead customers, lying to regulators, and giving financial advice which were not in the best
interest of the customers. The regulators has taken action and the issued a 76 long
recommendation. Hayne report has warned the Australian Prudential Regulation Authority and
the Australian Securities and Investments Commission to take tough actions. They may need to
pay 850$ million compensation to the affected (Nikkei Asian Review, 2019).

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Report on NAB Banking System
References:
Dalton, C., 2017. The Australian securitisation market 10 years on from'the global financial
crisis'. JASSA, (2), p.22.
Ellis, L. and Littrell, C., 2017. Financial Stability in a Low Interest Rate Environment: An
Australian Case Study. Monetary Policy and Financial Stability in a World of Low Interest
Rates. Reserve Bank of Australia, Sydney.
Epstein, M.J., 2018. Making sustainability work: Best practices in managing and measuring
corporate social, environmental and economic impacts. Routledge.
Nab.com.au (2019). Personal. [online] Nab.com.au. Available at: https://www.nab.com.au/#
[Accessed 26 May 2019].
NewsComAu (2019). New reasons to hate your bank?. [online] NewsComAu. Available at:
https://www.news.com.au/national/oxfam-accuses-anz-nab-westpac-and-commonwealth-of-
loaning-to-firms-engaged-in-unethical-practices/news-story/
f132bcc29f27b5a301354aa9e6c558c0 [Accessed 26 May 2019].
Nikkei Asian Review (2019). NAB top brass quits after damning Australian banking report.
[online] Nikkei Asian Review. Available at: https://asia.nikkei.com/Business/Companies/NAB-
top-brass-quits-after-damning-Australian-banking-report [Accessed 26 May 2019].