National Australia Bank remains a lot less profitable than any of its peers and the 2007 profit, reported on Friday, while better than previously, largely confirms how far off the pace the bank remains in extracting profit from franchises that aren't that different to its peers'.The headline profit of $4.4 billion and up 17 per cent over 12 months is broadly consistent with the restructuring and recovery story that's been the theme of NAB management since the upheavals of three and half years ago.With a return on equity about three quarters the level of ANZ, Commonwealth, St George and Westpac and with a return on assets of about four fifths of its peer group, NAB still has plenty of ground to make up.The five largest banks have, as a group, stretched their profits (measured as return on equity) to 21.2 per cent this year (based on comparisons prepared by KPMG), and this is up 0.6 percentage points over one year by 1.6 percentage points over two years. St George and Westpac are the sector leaders (with returns in excess of 23 per cent), while CBA and ANZ earn close to average returns.NAB's management adopted a confident tone in explaining the profit to media and analysts on Friday: there's a recovery in revenue, costs are in line with inflation and the company is "restoring" ROE and there's generally plenty of momentum in the various businesses.Managing director John Stewart only half jokingly mentioned giving back capital as one means to lift ROE. Asked what the bank's ROE target was he said it was internal but acknowledged the Westpac and St George returns as a relevant benchmark.That's the rhetoric, and key metrics on various NAB group businesses are spelled out in subsequent articles today.The bank reported a rise in cash earnings of 21 per cent, to $2.5 billion, in the 2007 year. Between 60 per cent and two thirds of this earnings growth is said to be attributable to the business bank and the balance to the retail bank.At a high level the metrics for NAB's Australian banking business are reasonably bright: the return on average assets, one measure of profit, increased to 1.07 per cent from 1.00 per cent over the year, and to 1.10 per cent from 1.04 per cent over the half year. The cost to income ratio fell to 46 per cent in 2007 from an inflated 51 per cent in 2006.The reality, affecting National's chief franchise and in its key market, may be a little different.NAB's Australian retail business is not achieving the growth of its peers and the efforts to cultivate a more productive sales culture aren't meeting internal targets. There's also talk of more management changes once those announced last month, but not put into effect, occur next month.While there's not much visibility in the bank's financial report on the earnings split between business banking and retail banking NAB is likely to supply this breakdown for the March 2008 half year.One proxy is the data on