Australia’s NAB pulls out of private equity

The bank will make no more investments via its Integrated Capital Solutions division and existing investments will be allowed to run their course and be exited over time.

NAB was the last of Australia's Big Four banks to operate a captive PE unit. ANZ withdrew from the asset class in 2008 following the global financial crisis and Westpac followed suit three years later. Commonwealth Bank of Australia claims never to have run a private equity division.

NAB invested an undisclosed sum in WOW in 2010, gaining a seat on the board. Already a lender to WOW, it planned to support the company in growing from 15 stores to 40 and establishing itself as a nationwide brand. "We had quite a few other options but the package that NAB presented to us suited our needs ... particularly in terms of future growth," a WOW spokesperson said at the time.

Less than a year after NAB's investment, the company ran into trouble as a result of poor liquidity in local property markets - it had amassed property debts of A$20 million during the latter part of 2010. Creditors appointed receivers Ferrier Hodgson to manage the assets. No buyer came forward and so all 15 stores were closed and 580 staff lost their jobs.

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• Topics
• Australasia
• Australia
• NAB