The Business and Private Banking arm of National Australia Bank (NAB), which caters to HNW clients through Private Bank and JBWere, has reported cash earnings of A$2.84bn ($1.95bn) for the year ended 30 September 2019.

This is a fall of 2% from the prior-year figure of A$2.91bn. The decrease was said to be due to higher credit impairment charges and technology investments.

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The unit’s net operating income and underlying profit both rose 1% year-on-year to A$6.67bn and A$4.4bn, respectively.

However, operating expenses took a hit, increasing to A$2.26bn from A$2.23bn with continued investment in technology and initiatives to improve compliance.

NAB’s Consumer Banking and Wealth unit reported a decrease of 11% in cash earnings to A$1.36bn from A$1.54bn.

The division’s net operating income of A$5.31bn was 4% lower than the previous year while underlying profit dipped 8% year-on-year to A$2.25bn.

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At a group level, NAB’s cash earnings dropped 11% to A$5.1bn.

The earnings were adversely affected by customer remediation costs of A$1.1bn after being charged by the banking royal commission over fees-for-no-service.

NAB CEO Philip Chronican said: “This year has been very challenging, requiring significant actions for us to deal with past issues and make real changes aimed at earning trust with customers and the community. Fixing things for customers is an important part of that process.

“We now have more than 950 people dedicated to remediating customers and in FY19 recognised additional charges of $1,100 million after tax for customer-related remediation3.

“These charges, along with a change in our software capitalisation policy, are the main reasons FY19 cash earnings are 10.6% lower than FY18. While this is a disappointing outcome, excluding these large notable items, cash earnings rose 0.8%.”