Yorkshire Bank’s parent reports fall in bad debts

David Thorburn, chief executive of the UK business, said good progress has been made since the outcome of the strategic review was announced in April.

“The restructuring continues to gather momentum and, while there is still much more to be done, our clear focus remains on further strengthening the business through a simplified business model built on our traditional strengths,” he said.

NAB said first-quarter cash earnings rose by about four per cent.

NAB posted an unaudited cash profit of £957m, up slightly on last year.

Cash profits, which exclude one-offs, non-cash accounting items and investment gains or losses, are the most closely watched by investors.

The stock was boosted last month by speculation Spain’s Banco Santander was mulling a £2bn bid for NAB’s 337 Clydesdale and Yorkshire bank branches. Santander denied it was in talks with NAB.

NAB said its charge for bad and doubtful debts, an area of concern for the industry in late 2012, had fallen about 10 per cent.

Revenues rose three per cent, boosted by its wholesale banking division and fatter customer margins.

Chief executive Cameron Clyne said: “This is a pleasing result, especially given operating conditions remain challenging in both Australia and the UK, notwithstanding recent improvements in financial markets.”

Mr Clyne said NAB had cut around 500 jobs in the quarter, mostly in the UK operations, and it will focus on reducing costs further.