NAB still unclear on remediation costs
National Australia Bank's total cost for customer-related remediation has hit A$1.1 billion, following the bank's announcement last week that it had booked additional charges of $525 million.The increased provision would reduce half-year profit by an estimated $325 million.Of the latest round of charges, 91 per cent relate to the bank's wealth business. Key items involved in the remediation program include consumer credit insurance sales, non-compliant advice given to wealth customers, service fees charged by NAB Financial Planning and fees charged by NAB Advice Partnerships.There are also some banking related matters, including incorrectly charged fees on certain fee-exempt transactions.NAB chief executive Phil Chronican said in a statement that the bank had 350 people working on customer remediation and that number would soon increase to 500 "as we bring greater focus and discipline to resolving issues and making sure they do not happen again".Remediation costs are likely to go higher. The bank said that the increased provision in relation to NAB Advice Partnerships was to cover the expected costs of undertaking the review. At this stage the provisions "exclude any allowance for customer refunds, which are still to be determined."