National Australia Bank (ASX:NAB) Stock Outlook – December 4, 2025: Share Price, Dividend and 2026 Forecasts

National Australia Bank Limited (ASX:NAB) is heading into its December AGM trading a little above A$40 per share after a bumpy few months that saw the stock slide from record highs, digest flat FY25 earnings and attract increasingly cautious broker research. ^[1]

For investors watching NAB for income or bank-sector exposure, today’s picture is a mix of rock‑solid capital, generous dividends, rising loan‑loss charges and a valuation that some analysts now call “stretched”.

NAB share price on 4 December 2025

Intraday on 4 December 2025, NAB shares are trading around A$40.4–A$40.5, with the day’s trading range roughly A$40.09 to A$40.51. ^[2]

That leaves the bank:

Close to the middle of its 52‑week trading range between about A$31.1 and A$45.3 ^[3]
Roughly 10–11% below its early‑November peak near A$45.25 Ts2 Tech
Modestly up on where it started calendar 2025, depending on the exact starting date used ^[4]

Price history services show November 2025 closed at about A$40.10, down from around A$43.62 in October – an ~8% monthly fall that lines up with retail‑investor commentary about a rough month for both NAB and Commonwealth Bank. ^[5]

In other words: NAB is no longer priced like a runaway winner, but it’s still far from “distressed”.

FY25 results: flat cash earnings, rising costs

NAB’s full‑year 2025 (FY25) results to 30 September, released on 6 November, set the tone for how the stock is trading today. ^[6]

Headline numbers:

Statutory net profit: A$6.76 billion (down about 2.9% year‑on‑year) ^[7]
Cash earnings: A$7.09 billion, essentially flat (‑0.2%) on FY24 and slightly below market expectations of around A$7.17 billion ^[8]
Net interest income: ~A$17.4 billion, up 3.8% ^[9]
Net operating income: ~A$20.8 billion, up 2.9% Ts2 Tech
Underlying profit: about A$11.0 billion, up 1.3% Ts2 Tech

At first glance, that’s a textbook “steady but unspectacular” bank result: revenue drifting higher, profit roughly flat.

Margins, impairments and credit quality

NAB has been operating in a world where competition for deposits, higher wholesale funding costs and the end of rapid rate hikes have all squeezed margins. Yet independent commentary notes that group net interest margin actually expanded by about 3 basis points in the second half of FY25, a better outcome than several peers that are still battling margin compression. ^[10]

The more worrying line items sit in loan‑loss charges and arrears:

Loan impairment charges rose about 14% to roughly A$833 million, driven by missed payments, a handful of larger business exposures and some unsecured retail stress. ^[11]
Non‑performing loans ticked up to around 1.55% of the book, with most of the increase coming from business banking, reflecting NAB’s larger exposure to corporate and SME borrowers. ^[12]

Management and external analysts are framing this as a normalisation from ultra‑low impairment levels, not a full‑blown credit event, but it does eat into profit growth and is one reason the stock de‑rated from its October highs. ^[13]

Capital, liquidity and ratings: still a fortress

On the balance sheet, NAB remains one of the most conservatively capitalised banks in the world:

Common Equity Tier 1 (CET1) ratio: 11.70% at 30 September 2025, with a pro‑forma 11.81% after the sale of the remaining 20% stake in MLC Life. ^[14]
Liquidity Coverage Ratio: quarterly average around 135% in the September quarter. ^[15]
Net Stable Funding Ratio: about 116%. Ts2 Tech+1

Major rating agencies keep NAB at AA‑ / Aa2 long‑term with Stable outlooks, reflecting strong asset quality and its systemic importance to the Australian financial system. ^[16]

Put simply: capital and liquidity are not the issue here. Earnings momentum and valuation are.

Dividend and yield: fully franked income remains the drawcard

Income investors continue to watch NAB closely because of its dividends rather than its glamour.

For FY25 the bank declared:

Final dividend: 85 cents per share, fully franked
Full‑year ordinary dividend: 170 cents per share, up from 169 cents in FY24
Ex‑dividend date: 11 November 2025
Payment date: 12 December 2025 ^[17]

At a share price around A$40.4, that implies a trailing cash dividend yield of roughly 4.2%, or close to 6% on a grossed‑up basis for Australian investors able to use the franking credits. ^[18]

NAB has also completed multiple on‑market buybacks in recent years and continues to neutralise its dividend reinvestment plan (DRP) with shares bought on market, which has helped boost earnings per share even while total cash earnings are flat. Ts2 Tech+1

The trade‑off: a high payout ratio in the low‑70% range limits how much of future earnings growth can be retained on the balance sheet, so dividend growth is likely to be modest unless profits re‑accelerate. Ts2 Tech+1

Strategy: business banking, housing and digital transformation

NAB’s CEO Andrew Irvine has spent his first full year in charge hammering home three strategic priorities:

Grow the business bank
Drive deposit growth
Strengthen proprietary (direct‑to‑customer) home lending ^[19]

The FY25 numbers show real progress:

Australian business lending balances up about 3% year‑on‑year, with particularly strong growth in the second half. ^[20]
Business & Private Banking cash earnings up 1.6%; Personal Banking up 9.9%; Corporate & Institutional up 4.7%; New Zealand up 1.5%. Ts2 Tech
Customer deposits up roughly 7%, with Personal Banking deposits up more than 9% and an 18% jump in new transaction accounts – crucial for cheap, sticky funding. ^[21]
The proportion of new home‑loan flows coming through NAB’s own channels lifted to about 41%, from 38% a year earlier, reducing reliance on more expensive broker distribution. ^[22]

Behind the scenes, NAB is spending heavily on technology. Around A$1.8 billion was invested in FY25, up from A$1.6 billion, much of it on cloud migration, digital channels and artificial‑intelligence‑driven tools for bankers. ^[23]

Fintech industry reporting suggests that nearly 90% of NAB’s applications are now running in the cloud, with a multi‑cloud setup spanning AWS, Microsoft Azure and Google Cloud – a shift that has sharply reduced serious outages and improved resilience. Ts2 Tech

Cost cuts and offshoring

That investment is being partly funded by restructuring. In September NAB confirmed it would cut around 410 roles in Australia, mainly in technology and enterprise operations, while creating 127 new roles in India and Vietnam. ^[24]

Management frames this as building a global, 24/7 workforce and unlocking efficiency; unions and critics view it as hollowing out domestic jobs. Either way, it underlines the pressure to keep costs under control as technology and compliance spending rise.

Housing as “Australia’s biggest societal challenge”

In parallel, Irvine has positioned NAB as a central player in tackling the housing crisis. The bank has set an ambition to provide at least A$60 billion of housing‑related financing by 2030, split between funding new housing supply and supporting first‑home buyers through government schemes. Ts2 Tech+1

NAB estimates this could support around 50,000 new homes and 55,000 first‑home‑buyer loans, depending on policy settings and construction capacity. Ts2 Tech+1

That ambition is not just about civic virtue; it’s also about protecting NAB’s franchise in the politically sensitive mortgage market while maintaining profitable lending.

Optional upside: HSBC Australia’s retail business

On the M&A front, the Australian Financial Review has reported that HSBC’s Australian retail banking business – roughly A$33 billion in mortgages and A$19 billion in deposits – is “NAB’s to lose”, with the bank seen as a front‑runner among bidders. ^[25]

No deal has been announced, and any acquisition would come with regulatory scrutiny. But if NAB secured those assets at a reasonable price, it would meaningfully enlarge its mortgage and deposit books.

Macro backdrop: NAB’s soft‑landing thesis meets hotter inflation

NAB’s own economics team has been publishing a steady stream of research on the Australian and global outlook – important context for a bank so exposed to business lending and housing.

The September 2025 “Forward View Australia” argued that Australia is on track for another year of below‑trend growth in 2025, with GDP growth returning to around trend in 2026, unemployment peaking around 4.4% before easing, and underlying inflation settling near 2.5% by late 2025. ^[26]

By November’s “Forward View – Goldilocks on hiatus” and associated commentary, the tone had shifted:

Quarterly inflation readings have re‑accelerated.
NAB now expects underlying inflation to stay above 3% for several quarters and to remain in the top half of the Reserve Bank’s target band through 2026.
The bank’s economists see the cash rate staying at 3.6% for the foreseeable future, with the bar for further cuts now “much higher”. ^[27]

An ABC News analysis last week highlighted that NAB has gone further, effectively calling the easing cycle “over” and warning that if growth or the labour market re‑accelerates, the RBA may have to consider rate hikes as early as the first half of 2026. ^[28]

For NAB shareholders, that mix is double‑edged:

Higher‑for‑longer rates help support net interest margins.
The same environment risks more stress for highly leveraged borrowers in an already expensive housing market, which could push impairments higher over 2026–27. ^[29]

Globally, NAB’s economists expect world growth of about 3.3% in 2025 and 3.0% in 2026–27, a reasonably supportive backdrop for business lending but not a boom. ^[30]

What analysts and market commentators are saying about NAB

There is no single “street view” on NAB at current prices – but some clear themes do emerge.

Consensus: modest downside from here

Data collated by Investing.com and other broker aggregators show:

A consensus 12‑month price target around A$38 from roughly 14 analysts
Target range roughly A$29–A$46.3
An overall “Sell” bias, with only a small minority rating the stock a Buy while most sit on Hold or Sell. ^[31]

Given the current share price near A$40, that implies low‑ to mid‑single‑digit downside on the average target, but with plenty of dispersion depending on how optimistic you are about margins and credit quality.

Technical overlays are, if anything, more negative. Short‑term indicator sets on platforms such as Investing.com skew to “Strong Sell”, with NAB trading below most key moving averages (though still above its 200‑day average), reflecting the post‑result de‑rating and November’s slide. Ts2 Tech+1

Fundamental research: “wide moat, but valuation looks stretched”

Morningstar’s late‑November note on NAB (summarised in secondary coverage) assigns the bank a “wide moat”, citing its leading business‑banking franchise and scale, and assumes:

Around 4.5% annual loan growth through 2030
Sustainable return on equity in the 11–12% range

But it also pegs fair value at about A$33 per share, well below the current price, and therefore sees the stock as “materially overvalued” with a forward P/E near 18x and a ~4% yield. Ts2 Tech

The bullish camp: “steady in a tough environment”

On the other side of the ledger, some active managers remain constructive.

A recent Livewire Markets analysis described the FY25 result as “steady in a tough environment”, arguing that the market has focused too much on higher impairments and not enough on:

A small but important NIM expansion in the second half
Strong deposit growth that largely funded loan growth
A rock‑solid CET1 ratio and conservative provisioning

The author values NAB at around A$54 per share on a 2–3 year view – implying 20–25% upside from around A$40 – and is comfortable with the current valuation given the strength of the franchise and the bank’s willingness to keep investing through the cycle. ^[32]

Retail‑investor and technical commentary

Retail‑focused outlets and trading platforms have emphasised a different angle:

November’s ~8% share‑price drop is being framed as evidence that big banks are not a one‑way bet, even in a relatively benign economy. ^[33]
Several market reports list NAB among ASX 200 stocks in short‑term downtrends, particularly within the financials sector. Ts2 Tech+1

The result is a tension between strong fundamentals and soft momentum – a classic setup where different investor types reach very different conclusions.

Key risks and opportunities for NAB into 2026

Looking beyond today’s headlines, a few swing factors will likely dominate NAB’s share‑price story over the next 12–18 months:

1. Credit cycle and arrears
If higher‑for‑longer rates and elevated inflation push more households and businesses into stress, impairment charges could overshoot current expectations. NAB’s business‑bank tilt means it may feel corporate‑credit wobble more than some peers. ^[34]

2. Regulation and macro‑prudential rules
New caps on high‑debt‑to‑income mortgages from APRA – limiting the riskiest loans to a small share of new lending – will cool some of the highest‑margin parts of the home‑loan market. That’s a headwind for growth, even if it strengthens the system over time. Ts2 Tech+1

3. Cost control vs. investment
NAB is trying to do two hard things at once: lift technology and front‑line investment and trim its cost base through restructuring and offshoring. If execution slips, either costs stay higher for longer, or customer experience and risk management suffer. ^[35]

4. Capital management and potential acquisitions
With CET1 comfortably above regulatory minima, NAB has options: more buybacks, special dividends, or balance‑sheet firepower for acquisitions like HSBC Australia’s retail bank. The market will watch closely how aggressively management deploys that capital. ^[36]

5. ESG and climate scrutiny
NAB’s 12 December 2025 AGM will feature shareholder proposals on climate and deforestation finance that the board recommends voting against. How the bank handles these debates will matter for its social licence and some institutional mandates. Ts2 Tech

Bottom line: what today’s setup means for investors

As of 4 December 2025, National Australia Bank looks like a classic income‑stock dilemma:

Pros
- Big, diversified franchise with strong positions in business lending and deposits
- Capital and liquidity comfortably above regulatory minimums, with high AA‑range credit ratings
- Fully franked dividend yield around 4.2% (~6% grossed‑up) and a long history of paying
- Strategic investment in technology and housing‑finance initiatives that could support medium‑term growth ^[37]
Cons
- Cash earnings essentially flat, with higher impairments and operating costs soaking up revenue growth
- Valuation that many analysts see as at or above fair value, with consensus targets below the current price
- Short‑term share‑price momentum that screens as weak across many technical indicators ^[38]

Whether that mix makes NAB a buy, hold or trim depends on your own assumptions about the credit cycle, RBA policy, and how much you value a fully franked dividend stream from a major bank versus other opportunities.