National Australia Bank made a net profit of A$2.5 billion for the six months to March - up 22.8 per cent on the previous corresponding period and up 24.1 per cent on the previous half.Return on equity was 12.4 per cent, compared with 10.4 per cent for the previous corresponding period and 10.1 per cent for the previous half.Net operating income rose only a little and expenses were higher. The improved bottom line was the result of a substantial drop in the charge for bad and doubtful debts.Net interest income of $6.6 billion was down 1.5 per cent on the previous corresponding period but up 0.3 per cent on the previous half. Other operating income rose more strongly, while income from the wealth division was down.Net operating income of $9.2 billion was up 1.6 per cent on the previous corresponding period and up 1.5 per cent on the previous half.The net interest margin of 2.03 per cent was down 14 basis points from the previous corresponding period and down three bps from the previous half.Operating expenses of $3.9 billion were up 0.6 per cent on the previous corresponding period and up 2.6 per cent on the previous half.The bank failed to meet one of its key metrics in the March half, which is to achieve "positive jaws" (income growing faster than expenses).The cost-to-income ratio (for banking activities) was 41.7 per cent, compared with 41.8 per cent for the previous corresponding period and 40.8 per cent for the previous half.NAB's bad debt charge was $1.1 billion. This was down 3.4 per cent on the previous corresponding period and down 26.4 per cent on the previous half.On the bank's preferred measure of cash earnings, calculated after adjusting for changes in the value of bank treasury shares and hedge accounting, the bank made a profit $2.9 billion - up 3.1 per cent on the previous corresponding period and up 11.9 per cent on the previous half.The cash return on equity was 14.7 per cent.Among the divisions, business banking profit (which made up 41 per cent of total earnings) was down 1.9 per cent on the previous corresponding period, personal banking was up 19 per cent and wholesale banking was up 18.7 per cent.NAB Wealth was down 1.5 per cent, New Zealand banking was up 0.5 per cent, the United Kingdom went from a loss of £25 million in the previous corresponding period to a profit of £41 million in the latest half.