NAB share price drops amid AUSTRAC update

Bank building with the word bank on it.

Bank building with the word bank on it.

In morning trade, the National Australia Bank Ltd (ASX: NAB) share price is in the red.

At the time of writing, the banking giant’s shares are down over 1% to $32.24.

Why is the NAB share price in the red?

The NAB share price is falling on Monday after the bank released an update on its AUSTRAC investigation.

According to the release, NAB has entered into an Enforceable Undertaking (EU) with the government financial intelligence agency.

This follows an enforcement investigation undertaken by AUSTRAC, which commenced in June 2021, in relation to NAB’s compliance with Australia’s anti-money laundering and counter-terrorism financing (AML/CTF) laws.

Under the terms of the EU, NAB is required to:

  • Complete a Remedial Action Plan (RAP) approved by AUSTRAC by 31 December 2024
  • Address to AUSTRAC’s satisfaction any deficiencies or concerns with activities in the RAP identified by AUSTRAC
  • Appoint an AUSTRAC-approved External Auditor who will provide a final report by 31 March 2025.

Taken longer to fix that ‘it should have’

NAB’s CEO, Ross McEwan, acknowledged that it has taken the bank longer than it should have to fix its AML/CTF issues.

He explained:

“We take our AML/CTF obligations very seriously. We acknowledge the concerns that led to AUSTRAC’s investigation. We will continue to work closely with AUSTRAC as we deliver the agreed further actions.

“We recognise it has taken us longer to fix the concerns raised than it should have. We welcome AUSTRAC’s acknowledgement that NAB has undertaken significant work to date – and we accept that there is more to do.

Mr McEwan highlights that the money laundering threat is evolving at an incredible rate and NAB is making it a priority to address this.

He commented:

“It is essential that everyone in our bank is focussed on getting the basics right, every time, and keeping our customers and bank safe. Keeping criminals out of the financial system is a top priority for NAB. We recognise our opportunity to better detect, deter and disrupt the flow of illegal money at a time when the threat is evolving at an incredible rate.

“We have a plan to make our bank simpler for customers to use, while safeguarding against the criminal threat. The EU provides a clear timeline as we further build capability, increase resourcing, continue to modernise our systems and improve controls and governance.”

The post NAB share price drops amid AUSTRAC update appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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