UBank

{{Infobox_Company |

 company_name   = UBank|

company_logo =

Corporate Logo

Corporate Logo

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 company_type   = [[A division of National Australia Bank |
 company_slogan = A Good Place for Money. |
 foundation     = 1 October 2008|
 location       =  Sydney, Australia|

key_people =

Editing Gerd Schenkel (General Manager) | industry = Financial services | products = Banking, Term Deposits| homepage = Ubank Homepage| }} UBank is a division of National Australia Bank, the largest financial institution and bank in Australia in terms of market capitalisation and customers. It is one of the world's top 30 financial services companies with total assets of A$457 billion as at 30 September 2006. It operates across 10 countries serving 6 million banking customers and over 2.3 million wealth management customers.

Core business

The National Australia Bank Group is organised around four key businesses: Australia - NAB and MLC brands; United Kingdom - Clydesdale Bank and Yorkshire Bank brands; New Zealand - Bank of New Zealand brand; and nabCapital, formerly Institutional Markets & Services, which operates internationally.

History

In 1893, National Bank Limited was formed. Up until 1 October 1981 it continued to trade as The National Bank of Australasia Limited, only after the merger with the Commercial Banking Company of Sydney Limited did it become known as National Australia Bank.

National Bank of Australasia Limited

In 1858 Alexander Gibb, a Melbourne gentleman, enlisted Andrew Cruickshank, a local merchant and pastoralist, to raise the capital to establish National Bank of Australasia with headquarters in Melbourne. Cruickshank became its first chairman while Gibbs left after being passed over for the position of General Manager. The bank opened its first branch in South Australia the same year.

Expansion to other Australian states followed, with branches opening in Tasmania (1859), Western Australia (1866), New South Wales (1885) and finally Queensland (1920).

An early branch established in Mauritius (1859) closed within a year, but a London branch (1864), established to handle financing and payment for Australian exports of wool, gold and other commodities, and imports to Australia, was more successful.

National Bank of Australasia was one of many banks that closed its doors during the banking crisis of 1893. Director John Grice was active in the crisis, from which the bank re-emerged as a public limited company, incorporated on 23 June 1893.

For the next half century, growth was stimulated by a number of acquisitions:

• Colonial Bank of Australasia (est. 1856) in 1918, bringing additional branches in Victoria and New South Wales.
• Bank of Queensland in 1922, with branches in Queensland, New South Wales and Victoria. The Bank of Queensland was itself result of the merger in 1917 of Royal Bank of Queensland (est. 1886) and Bank of North Queensland (est. 1888).
• Queensland National Bank (est. 1872) in 1948, with branches in Queensland, New South Wales and Victoria.
• Ballarat Banking Company (est. 1865) in 1955

The bank opened a representative office in Tokyo in 1946, later upgraded to a branch in 1985. The bank’s overseas interest expanded more rapidly in the 1970’s. It opened a branch in Singapore in 1971, and representative offices in Jakarta (1973) and Hong Kong (1974). It took minority interests in merchant banks in these locations at the same time, and in Hong Kong established a 50-50 joint venture merchant bank with Mitsubishi Bank and Trust, but withdrew from these arrangements in 1984. Its first US presence was established in 1977 with a branch and an agency in Los Angeles that closed in 1993.

The Commercial Banking Company of Sydney Limited (CBC)

On the 8 September 1834 the Sydney Herald carried a notice titled "Commercial Banking Company of Sydney" proposing the stablishment of a new bank. It began operations on 1 November 1834 and in 1848 was incorporated by an Act of the New South Wales Parliament. Sir Edward Knox was the first Bank Manager and later a director. Thomas Barker (born 1799 London, England, died 1875 Bringelly, New South Wales), a manufacturer, engineer, politician, landowner and philanthropist was a notable director and chairman.

The CBC grew to service the expanding pastoral and farming industries of the then Colony of New South Wales.

1980-2000 merger and rapid overseas expansion

In 1981, National Bank of Australasia Limited merged with The Commercial Banking Company of Sydney Limited to form National Commercial Banking Corporation of Australia Limited and subsequently changed its name to National Australia Bank Limited (NAB).

The expanded financial base of the merged entity triggered significant offshore expansion over ensuing years. Representative offices were established in Beijing (1982), Chicago (branch 1982), Dallas (1983), Seoul (1983, upgraded to a branch in 1990), San Francisco (1984), Kuala Lumpur (1984), Athens (1984, closed 1989), Frankfurt (1985, closed 1992), Atlanta (1986), Bangkok (1986), Taipei (1986 upgraded to branch 1990), * 1988: NAB opened a representative office in Shanghai (1988, closed 1990), Houston (1989) and New Delhi (1989).

In 1987, NAB bought Clydesdale Bank (Scotland) and Northern Bank (Northern Ireland and Republic of Ireland) from Midland Bank. It rebranded Northern Bank branches in the Republic of Ireland to National Irish Bank and changed both banks' logos from that of the Midland Bank. In 1990, NAB bought Yorkshire Bank (England and Wales).

Further acquisitions followed - Bank of New Zealand in 1992, which at the time had about a 26% market share in the New Zealand market, and Michigan National Bank (MNB) in 1995. NAB had earlier rationalised its operations in the US and closed its offices in Atlanta, Chicago, Dallas, Houston, and San Francisco in 1991.

This period of rapid expansion through acquisition concluded with the purchases in 1997 of HomeSide Lending, a leading US mortgage originator and servicer based in Florida, and most significantly, the acquisition in 2000 of MLC Limited (and related MLC entities) for $4.56bn, one of the biggest mergers in Australian corporate history.

NAB encountered a difficult period in the period 2000-2005. In 2000, NAB sold Michigan National Bank to ABN AMRO, then in 2001 sold HomeSide’s operating assets for US$1.9b to Washington Mutual, the largest US savings and loan company, as well as the mortgage unit's loan-servicing technology and operating platform.

HomeSide

NAB booked two write-downs associated with HomeSide. First, in July 2001, NAB had a $450 million write down of the value of its capitalised mortgage servicing rights (CMSRs) during the quarter ending June 30, 2001, and was the result of exceptionally high mortgage refinance volumes which lowered the value of the CMSRs, combined with a more challenging capital markets environment in which to hedge interest rate risk. This was followed shortly by a second write-down reported in September totalling $1.75 billion; this second write-down consisted of US$400 million from an incorrect interest rate assumption embedded in the mortgage servicing rights valuation model, US$760 million from changed assumptions in the model flowing from the continued unprecedented uncertainty and turbulence in the mortgage servicing market, and US$590 million from writing off of the goodwill. In total, NAB booked $2.2 billion in losses due to HomeSide.

NAB Headquarters at Melbourne Docklands

Foreign currency options fraud

In 2004, NAB discovered that as a result of unauthorised spot trades on its foreign currency options desk, losses totalling $A360 million had been covered up. Investigations by Price Waterhouse Coopers and the Australian Prudential Regulation Authority highlighted a need for cultural change. The losses were a result of a failed speculative position where the traders falsified profits to trigger bonuses over a number of years. In order to actually generate the reported profits, the traders speculated on the US dollar, betting that it would rise against the Australian dollar and other currencies. This incident led to the resignations of CEO Frank Cicutto and Chairman Charles Allen. In 2006, the two traders most heavily involved in the fictitious trades, David Bullen and Vincent Ficarra, were sentenced to 44 and 28 months jail respectively.

Tax evasion and customer overcharging in Ireland

The Irish subsidiary of the bank, National Irish Bank was the subject of a six-year Inquiry carried out by Inspectors appointed by the Irish High Court. They established that National Irish Bank had engaged in overcharging its own customers and tax evasion schemes prior to 1998. Mr Justice Peter Kelly, an Irish High Court judge commented following publication of the Report "The edifice of banking is built on a foundation of trust. On the Inspectors findings there was a breach of trust. The operation was carried out over a period of years in a deliberate fashion". The Director of Corporate Enforcement subsequently applied to the High Court to have 9 senior managers barred from being an officer of any company.

Post 2005

NAB House, Melbourne

In 2005, NAB announced a cut of 2,000 Australian jobs as part of a global cost-cutting program with the intention of cutting around 4,200 positions – about 10.5% of its total workforce globally. It began to outsource back office positions offshore, beginning with a pilot with 23 jobs from the accounts payable department in Melbourne going to Bangalore, India in an agreement with Accenture. Later that year, it sold Northern Bank and National Irish Bank to the Danish Danske Bank. Over 200 additional jobs had been sent offshore by 2006.

By 2006, NAB had turned its fortunes around, reporting an industry record $4.3 billion profit and winning two local Bank of the Year awards. It also had a major reform which included the refurbishment of all of its branches, and the replacement of signage in and around National branches and buildings, being changed from 'National' to 'nab'.

File:National-nab.png

National Australia Bank transition logo 2006-early 2007

NAB launched a new division STAR Direct & Alliances to develop and operate businesses serving customers through non-branch channels. It is anticipated launching a new direct bank called Starbank. [[1]]

In May 2007 NAB announced that it would delist from the New York Stock Exchange, and this took place in Aug 2007. NAB delisted from the London and Tokyo exchanges in 2006.

In March 2008 NAB announced that it would send maintenance and support for some core banking applications to India through an offshoring arrangement with Infosys and Satyam, affecting another 260 employees.

On 25 July 2008, NAB's announcement of an additional $830 million (AUD) provision associated with deterioration in US real estate markets triggered the biggest single-day fall in its share price in 21 years, wiping over $7 billion (AUD) from the stock's value.

On 1 October 2008, NAB launched UBank, its new Direct Bank. UBank operates standalone from NAB but it is covered by NAB's banking license and backed by NAB's balance sheet, so UBank's deposits are as safe as NAB's.

Sponsorship

The National Australia Bank is a prominent supporter of Australian rules football, both at grassroots and elite level. It sponsors Auskick, an initiative to improve young footballers, as well as the NAB Cup (an Australian Football League pre-season competition), the NAB AFL Rising Star award; and the AFL National Draft. Other significant sporting sponsorships include the Socceroos, and the 2006 Commonwealth Games. Support is also given towards community group volunteers around Australia. In recent years, NAB has provided financial support and relief to drought affected farmers. From 2008-2010 NAB is sponsoring the South Sydney Rabbitohs.

Customer Relationship Management

NAB was recognised as an early adopter and leader in CRM (Customer Relationship Management). It is a large user of the Siebel CRM software and developed and implemented its "National Leads" analytical CRM system to support its sales force in identifying relevant customer sales & service opportunities.

In 2006, NAB revamped its CRM system having slipped behind other banks investing in CRM platforms using cutting-edge technology.

NAB also deployed its National Leads system to New Zealand and United Kingdom. In 2006, NAB was named the winner of the IFS/Cap Gemini Financial Innovation awards for its National Leads system.

References

External links

• NAB Group - Official NAB Corporate Site
• National Australia Bank - Australia Region
• Fortune Global 500 listing
• National Australia Bank stock chart
• CBC Officers Club