Clydesdale Bank and Yorkshire Bank announce annual results

20th October 2008

London, 21 October 2008: National Australia Bank Group, owner of Clydesdale and Yorkshire Banks, releases full year results for its UK operations, for the 12 months to 30 September 2008.

2008 Highlights: Comparison with 12 months to 30 September 2007

Profits

• Cash earnings after tax up 2.5% to £249m
• Underlying Profit up 11.9% to £518m
• Pre-tax profit maintained at £343m

Performance

• Net interest income up 8.1% to £879m
• Three consecutive years of flat costs
• Cost Income ratio improved to 57.9% from 60.1% - down 220 basis points in the year
• Retail and longer term funding covered 85% of lending
• Clydesdale Bank PLC’s (CB) long-term credit rating maintained at AA- by Standard & Poors, Aa3 by Moodys and AA- by Fitch

Quality growth

• Average gross loans and acceptances increased 27.6% to £31.4bn (includes nabCapital transfer)
• Average retail deposit balances increased 16.7% to £18.2bn
• Robust asset quality with a well secured, diversified portfolio
• Mortgage balances 90 Days Past Due stable and less than half the UK industry average
• Provisions coverage ratio maintained at 1.07%

Lynne Peacock, Chief Executive, said:

“These results demonstrate the resilience of our UK business which has continued to deliver a strong trading performance and sustained profitability in extremely challenging market conditions.

“Differentiated in the UK by our adherence to the sound principles of a traditional banking model, the prudent growth of our business has been supported by excellent cost control, a careful approach to funding as well as effective credit and risk management.

"The strong foundations of our Retail business underpinned excellent deposit growth balanced with good quality mortgage business acquisition. Business banking through our integrated Financial Solutions (iFS) centres also performed very well whilst fine-tuning its risk settings.

"On virtually every measure, the performance of our business compares very favourably in the current market and we remain resolutely focused on the prudent development of our business."

Download Annual Results PDF (opens in a new window)