NAB admirably shoulders a UK burden

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A good result. If the UK pulls out of the EEC, then the UK banking sector might get a big lift.

Nothing can detract from the fact that NAB once was first, now fourth amongst the big four banks. Apart from some tinkering (apologies to Nathan) with cost structures, home mortgage and deposit rates and attempts to portray NAB as the independent competitive component of the banking cartel, Cameron Clyne has posited no radical incentives and shown no leadership or drive that would distinguish him from his peers.

The reign of David Murray at CBA was hallmarked with a 'do nothing' approach, when doing nothing was the wisest way forward. Banking can be just boring old metered cash flow and profits. If it ticks over quietly and makes money, do not change a thing.

However, NAB has the UK Albatross. Moving bad commercial loans off the UK balance sheet was window dressing the UK businesses up for sale. That sale could not be effected at the top of the market and is unlikely to be achieved in this downturn, which started in 2008 and has a way to go yet.

That NAB can not sell the UK businesses should not mean they sit back, do nothing and wait until the market improves. Accepting they can not sell, NAB should be taking the view a buyer might take; that they have recently purchased at the bottom of the market a group of assets with real potential and start investing in the rebuilding of the UK brands.

The problem is that Melbourne is a long way away from London. Running UK businesses from Melbourne might have looked like blue cheese in the boom times that surrounded the purchases by NAB. Finding people of ability to run things in hard times has never been a Melbourne Establishment virtue. Ruled by the creed that you can not do business with people you do not know, the Melbourne Establishment has proved with NAB that it just does not know the right people and the the task is just beyond the capacities of the people they do know.

As opposed to the Sydney Establishment ie CBA/Westpac which have almost zero overseas business? What about the Perth Establishment RIO & the disasterous acquisition of Alcan? You can tailor the evidence to fit the charge.

The Nab does not have to sell the UK banks, it can spin them off in an IPO. NAB is a well capitalized, has stable growth in earnings (eps 13.5) and has a growing customer base and panic sellers today will regret it one day.

You do not have to be a 'panic seller' to recognise opportunity cost and take advantage of the capacity to choose wisely the bank in which you buy shares. NAB shareholders waited a long time to see the stock rise in recent times from AUD25ish to AUD30ish.Those who sold NAB when the shares were between AUD23 and AUD30 and bought CBA stock, then AUD37 would have doubled their money, while getting those fully franked dividends. The growth in the CBA share price is perhaps precisely because CBA has almost zero overseas business. They are happy to be a regional bank. They stick to what they know and do not go into things about which they know little. Their shareholders are happy too.

Stumbled across a phone conversation, reckon it was Clyde and Mike talking.
Went something like this.
.High Mike, hope you're well, Clyde here.
Yes Clyde, fit as a fiddle, what's up?
Just wanted to let you know that Ian,Gail and I are loving this beautiful weather, with all these 25 type days, but we heard a small whisper that it might get to 30 tomorrow....surely not?
No Clyde, rest easy, definitely only 25 again tomorrow.