Lisa Murray has an amusing story in The SMH this morning about poor old National Australia Bank getting beaten up in the Scottish Parliament for its latest savage cost, job and branch cutting program which included the following:
Last week, the Scottish Parliament held a special debate on NAB’s restructuring program, which will involve 100 branch closures in the UK, 60 of those at the Clydesdale Bank in Scotland. Forty-seven parliamentarians signed a motion condemning the move and the deputy minister for enterprise, Allan Wilson, agreed to write to NAB, requesting a meeting with Mr Stewart to discuss their concerns.
The original announcement attracted some publicity in the UK, as you can see from this BBC report, but last week’s debate in Parliament has only produced this report in the Glasgow Evening Times, according to Google.
Peter Costello and the Howard Government should take note. Banks are licensed by governments and any substantial withdrawal of services often raises the ire of politicians, as the Scots are demonstrating.
The Scottish Parliament was told that NAB CEO John Stewart is “an Edinburgh man,” which might get him thinking about the final requirement in his contract – a one-way first class ticket back to the UK.
Bank CEOs should be more on the nose in Australia but for some reason the finance sector unions, politicians and consumer groups have been too weak to get a serious backlash up and running against a cartel which is domestically focused and is now making $15 billion before tax each year.
Successive NAB CEOs have boasted about being the most efficient bank, thereby partly explaining its number one ranking in terms of market capitalisation. Alas, various blunders have now seen NAB surrender that title to the Commonwealth Bank which on Friday was capitalised at $48.4 billion. NAB trails with a value of $47.68 billion, which is disappointing given the latest round of 4,200 job cuts did briefly win back the title when it was first announced two months ago.