National Australia Bank chief executive Andrew Thorburn said he was looking forward to some easing of the pressure on the bank's margin in the year ahead, with signs that wholesale funding costs and mortgage rate discounting are easing.The bank's net interest margin fell two basis points to 1.88 per cent during the year to September, driven down three basis points by higher deposit costs and another three basis points by other funding costs.Thorburn said wholesale funding costs started to fall in the September quarter.In August, when the Reserve Bank cut the cash by 25 bps, NAB passed on ten bps. The bank will get a margin boost in the current year from that decision.At a briefing to release the bank's 2015/16 results yesterday, Thorburn fielded several questions from analysts about how the new regulatory requirement for banks to hold a minimum net stable funding ratio would impact its business plans.From January 2018 banks will have to demonstrate that long-term assets are financed with at least a minimum of stable funding. Stable funding is the portion of an ADI's capital and liabilities expected to be a reliable source of funds over a one-year time horizon. NSFR will force banks to rely more on deposits (especially term deposits) and long-term wholesale funding as funding sources, and less on short-term wholesale funding.NAB said its NSFR ratio was currently above 100 per cent but some of the rules are still subject to consultation with the Australian Prudential Regulation Authority. APRA is likely to insist on a buffer above 100 per cent and that level is yet to be determined.Thorburn said this new requirement would not limit the bank's ability to grow its lending book but he said it was being more careful about how it allocated capital, declining to write corporate and institutional loans that did not meet the cost of capital.He said the bank would also be working harder to earn higher returns by deepening customer relationships.In the mortgage market NAB was growing below system for much of the year but returned to system in July and August.Thorburn said there were some policy and process changes that accounted for the below-average growth. "We are at system now and we are happy that that level. We are not chasing growth," he said."Returns will come from doing more with those customers."