National Australia Bank Limited · ASX:NAB

National Australia Bank — Investor Presentation (August 2021)

13 slides from National Australia Bank's investor presentation, Aug 9, 2021

  1. Slide 1: Acquisition of Citigroup's Australian Consumer Business Investor Presentation

    ACQUISITION OF CITIGROUP’S AUSTRALIAN CONSUMER BUSINESS INVESTOR PRESENTATION 9 August 2021 © 2021 National Australia Bank Limited ABN 12 004 044 937 AFSL and Australian Credit Licence 230686

  2. Slide 2: Acquisition of Citigroup's Australian Consumer Business

    ACQUISITION OF CITIGROUP’S AUSTRALIAN CONSUMER BUSINESS • NAB has agreed to acquire the assets and liabilities of Citigroup’s Australian consumer business (the Target Business) • Supports NAB’s strategic ambition to build a leading personal bank with a simpler, more digital customer experience • The

  3. Slide 3: Overview of Citigroup's Australian Consumer Business to be Acquired

    OVERVIEW OF CITIGROUP’S AUSTRALIAN CONSUMER BUSINESS TO BE ACQUIRED A comprehensive set of consumer products targeting quality affluent customers UNSECURED LENDING MORTGAGES DEPOSITS / WEALTH  Leading white label provider to blue chip  Total balances $7.9 billion (net of provisions)  Long tenured

  4. Slide 4: Unsecured Lending Is Core to Our Personal Banking Strategy

    UNSECURED LENDING IS CORE TO OUR PERSONAL BANKING STRATEGY Credit cards are an important product for our customers PERSONAL BANKING STRATEGY • While total balances have declined in recent years, credit cards remain an important product facilitating customers’ short-term cashflow needs Type of debt c

  5. Slide 5: Scale and Access to Capability Will Accelerate Our Ambition

    SCALE AND ACCESS TO CAPABILITY WILL ACCELERATE OUR AMBITION Increased scale will support innovation in an evolving unsecured lending and payments market Incremental scale to NAB Personal Bank (Jun 21) • Increased access to transactional data with ~1.0 million additional unsecured lending customers •

  6. Slide 6: Incremental Scale in Mortgages and Deposits

    INCREMENTAL SCALE IN MORTGAGES AND DEPOSITS Migration of Citigroup mortgage and deposit portfolios delivers over 400k customers… Mortgage customer demographics Mortgage repayment profile Not • High quality, low risk mortgage book with Clustered 11% skew to more affluent borrowers Mature Less than 30

  7. Slide 7: Significant Synergy Benefits

    SIGNIFICANT SYNERGY BENEFITS PRE TAX SYNERGIES AND INTEGRATION COSTS Sources of cost synergies • Total pre-tax annual cost synergies of ~$130 million p.a. to be achieved over three years Technology systems2 • Representing ~30% of Citigroup’s stand alone cost base1 • Majority of savings driven by com

  8. Slide 8: Financial Implications

    FINANCIAL IMPLICATIONS  Pro forma financial impact assumes Target Business underlying earnings of ~$330 million and cash NPAT of ~$145 million for the year to June 20212  Key considerations for future revenue impact (post completion) − mortgage balances expected to decline over time (partly offset

  9. Slide 9: Appendices

    APPENDICES • INTEGRATION STRATEGY • KEY TRANSACTION TERMS • CARDS ASSET QUALITY 9

  10. Slide 10: Integration Managed by Specialist Team to Minimise Distraction

    INTEGRATION MANAGED BY SPECIALIST TEAM TO MINIMISE DISTRACTION High level integration phasing Targeting completion Full integration by March 2022 ‘Day 2’ 2021 2022 / 2023 2024 2025 Integration Pre-Completion planning Transitional Services Agreements Full integration on NAB Infrastructure phases (~9

  11. Slide 11: Key Transaction Terms

    KEY TRANSACTION TERMS Key Areas of Focus Commentary • The transaction is being structured as an asset and liability transfer, with NAB acquiring Citigroup’s Australian Transaction Perimeter consumer banking business comprising unsecured lending, mortgages, deposits, BNPL and wealth, the dedicated em

  12. Slide 12: Cards Asset Quality

    CARDS ASSET QUALITY KEY COMMENTS ARREARS 4% • Arrears low and on a downward trend post COVID-19 related spike in early 2020 3% 2.4% • White label portfolio tends to perform better than Citigroup portfolio 2% 30+ DPD 90+ DPD 1.0% 1% CREDIT COSTS1 0% Jun 18 Dec 18 Jun 19 Dec 19 Jun 20 Dec 20 Jun 21 90

  13. Slide 13: Disclaimer

    DISCLAIMER The material in this presentation is general background information about the NAB Group and its proposed acquisition of the Target Business current at the date of the presentation on 9 August 2021. The information is given in summary form and does not purport to be complete. It is intende

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