Australian bank margins have hit the peak and earnings are going to become harder to eke out, National Australia Bank Ltd. Chief Executive Officer Ross McEwan warned Thursday.
(Bloomberg) — Australian bank margins have hit the peak and earnings are going to become harder to eke out, National Australia Bank Ltd. Chief Executive Officer Ross McEwan warned Thursday.
Speaking to Bloomberg Television after a record half-year profit failed to ease investor nerves about the bank’s outlook, McEwan said a decline in the share price was “somewhat expected.” The stock lost as much as 8.2% as of 2:40 p.m. in Sydney.
“Today’s share price drop was nothing to do with our financial position, it was all to do with margin and analysts looking forward to the next six to 12 months and saying well, it could be a bit tougher,” McEwan said in the interview.
However, he said the Australian economy is “still running well.”
“We’re just starting to see the weakness in the retail sector starting to come off, and confidence is down of course with interest rates going up,” he said. “But it’s still quite a nice economy to be in.”
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