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Nat.Australia Bank (NAB)

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Wednesday 13 December, 2006

Nat.Australia Bank

Completes remedial action

National Australia Bank Ld
13 December 2006

Wednesday, 13 December 2006

NAB completes foreign exchange options trading remedial action program

National Australia Bank (NAB) today announced the Australian Prudential
Regulation Authority (APRA) has closed the remaining remedial actions associated
with the foreign exchange options trading issue.

Following the completion of the remedial action program, APRA has approved NAB's
return to the use of the internal model for the calculation of the market risk
component of risk weighted assets, from 1 January 2007.

APRA has also removed the regulatory requirement to maintain a capital target of
10%, effective immediately.
However, this will have no impact on NAB's capital planning for this financial
year, which had assumed a return to the internal model during the first half of

As indicated in the recent 2006 Profit Announcement, had the internal model
applied at 30 September 2006, then on a pro-forma basis the effect would be to
reduce previously advised risk weighted assets by approximately $9.9 billion.

National Australia Bank Group Chief Executive Officer, John Stewart, welcomed
the closure of the program and thanked APRA for the professional and
constructive way in which the program had been undertaken.

'Today's outcome is very pleasing, but we recognise that there is more work to
be done as part of a continuous improvement program to ensure our risk
management framework continues to strengthen. Everyone at the National Australia
Bank is looking forward to continuing to develop a business that is well
regarded by all our stakeholders and creates sustainable satisfactory returns
for shareholders.

'Together with the positive assurance from our independent auditors over
internal controls that we received as part of our annual financial close, and as
published in the annual financial report on 1 December 2006, this marks a major
step forward for the organisation, 'Mr Stewart said.

For further information:

Felicity Glennie-Holmes                              Hany Messieh
Senior Manager, External Relations                   Head of Investor Relations
T 03 8641 3627                                       T  03 8641 2312
M 0412 673 038                                       M  0414 446 876

Kim Lovely                                           Lyndal Kennedy,
External Relations Manager                           Manager, Investor Relations
T  03 8641 4982                                      T  03 8641 0011
M  0406 035 243                                      M  0400 983 038

                      This information is provided by RNS
            The company news service from the London Stock Exchange                                                                                         

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