Clydesdale & Yorkshire Banks' Interim Results 2011

5th May 2011

CUSTOMER SUPPORT KEY TO CREDITABLE PERFORMANCE

London, 5 May 2011: National Australia Bank Group, owner of Clydesdale and Yorkshire Banks, today released interim results for its UK Banking⁽¹⁾ operations for the 6 months to 31 March 2011. Unless otherwise stated, figures are comparisons with the 6 months to 31 March 2010. Highlights are:

Financial Performance

• Pre-tax cash earnings⁽²⁾ up 25% to £101 million
• Cash earnings up 26% to £77 million
• Retail deposits & longer term wholesale funding cover 94% of lending; Retail Cover Ratio 70%
• Strong liquidity with liquid assets of £9.8 billion

Customer Support

• £3.3 billion of new business and mortgage lending in the past 6 months
• £8 billion of new lending advanced in the past 18 months - on track to deliver £10 billion two year pledge by October 2011
• Average gross loans and acceptances of £32.6 billion
• Average retail deposit volumes up £900 million to £23.4 billion

Business Performance

• Interest earning assets up £500 million to £41.4 billion
• Charge to provide for bad and doubtful debts down 17% (£32 million)

Lynne Peacock, Chief Executive, said:

“The effectiveness of our support for customers and the sensible, consistent strategic direction we have maintained is clearly demonstrated in these creditable results. Pre-tax cash earnings are up 25% in the past six months continuing the substantial recovery in profitability achieved last year.

“Maintaining our sound capital position and balancing profit with increased security, a key focus has been to support our customers and this has been central to our success in these uncertain economic times. Despite subdued market demand for credit, we continue to offer genuine customer choice in the market. This is attracting growing numbers of small and mid-corporate trading businesses and helping us to further expand our mortgage book. It also helped us advance £3.3 billion of new lending in the half on top of £4.7 billion last year. We are well on track to deliver our two-year new lending commitment of £10 billion by October.

“As I prepare to pass the baton to David Thorburn and a very strong UK management team, I am proud to reflect on what we have achieved in transforming this business over the past seven years. While national economic recovery will continue to provide challenges, we have kept Clydesdale and Yorkshire Banks safe, strong and very well placed to capitalise on future growth opportunities.”

Download Half Year Results (PDF, opens in new window)