Clydesdale name nearly axed
News of the proposed move, which would have paved the way for a fund-raising listing on the London stock market, came as Clydesdale and Yorkshire posted a 7.4 per cent jump in combined net profits to 289 million.
Targett said: "We looked at it earlier this year, but decided not to do it. The strength of each of the brands in their local areas is too strong. The drawbacks would have outweighed the benefits."
Clydesdale, Scotland’s third largest bank, was established in Glasgow 164 years ago and now has 274 branches across the UK.
Along with Clydesdale and Yorkshire, which already report their results together, NAB owns two Irish banks - National Irish Bank and Northern Bank. NAB, which recently made a failed bid for troubled mortgage bank Abbey National, restated its UK acquisition ambitions yesterday.
City analysts have long said a London stock market listing would give NAB UK shares that it could trade with a bid target - such as Abbey National - as part of a takeover deal.
Although he declined to comment on whether the merger plans were linked to flotation ambitions, Targett - who doubles up as NAB’s head of European financial services - conceded that there was "compelling logic" to the argument.
Despite NAB’s group chief executive, Frank Cicutto, having earlier said the group was keeping an eye on further acquisition opportunities in the UK, Targett remained tight-lipped on whether there were any plans to revisit a bid for Abbey.
But he said: "If there’s a good deal we can do in the medium term that fits our plans and offers good value to our shareholders, we will do it."
Clydesdale and Yorkshire saw bad debt provisions rise 11.2 per cent to 129 million, but Targett insisted he was not overly-concerned by this figure and the overall asset quality was continuing to improve.
He added: "Our business book in Scotland has been relatively flat, but we’ve been very selective about the business we’ve been writing."
Targett said the bank’s award-winning flexible mortgage products were continuing to attract new business, with average lending up 7 per cent to 15.3 billion.
Despite being recently dubbed the UK’s worst high street bank by the Consumer Association, retail deposit volumes grew 6.3 per cent to 10.2 billion. Clydesdale and Yorkshire’s figures came as NAB - Australia’s biggest bank - reported a 62 per cent surge in annual profit to AUS$3.37 billion (1.17 billion).
But the figures come on the back of last year’s battered results, which were hit by massive writedowns at its Homeside Lending mortgage business in the US - which NAB has since sold off.
The results also slumped below analysts expectations of a $4 billion (1.4 billion) net profit, which sent the bank’s shares down about 3.4 per cent to $32.70 (1171p).