Jefferies says consumer franchises drive Australian banks' returns, favors NAB

Westpac Banking

08/09/2026 23:53

Updates
     ** Jefferies says consumer segment accounts for the largest share of sector profit among major Australian banks, but exhibits widest dispersion in returns
** Brokerage says strongest group outcomes associated with ownership of high-return consumer franchises and meaningful capital exposure
** Jefferies views Commonwealth Bank of Australia's CBA.AX outperformance as "sustainable", driven by its consumer segment's outsized share of allocated capital, but flags inflated valuation 
** Brokerage prefers National Australia Bank NAB.AX among its peers, owing to its business franchise which combines the sector's largest exposure with the lowest risk intensity, making it the most capital-efficient lender in the division
** Financial sub-index .AXFJ has lost 0.8% YTD, as of last close, while three of the "Big Four" banks have lost between 1% and 11%

 (Reporting by Sneha Kumar and Anjali Singh in Bengaluru)
 ((anjali.singh2@thomsonreuters.com;))