This new expenditure brings the total expected costs for payroll remediation in 2025 to approximately $130 million, adding to the $250 million NAB spent between 2020 and 2022 on similar issues.

The bank has started a broader review into payroll-related benefits under current and historical agreements, aiming to address all issues comprehensively.

Irvine also highlighted NAB's expectation to achieve over $400 million in productivity savings during the 2025 financial year, ending in September.

Although NAB's profits remained flat year-over-year, the bank experienced a slight decline in quarterly profits due to increased bad debt charges but remains optimistic about its long-term outlook.

The payroll review was initiated in 2019, initially focusing on 730 employees underpaid by about $850,000, but it has since uncovered widespread underpayments costing the bank hundreds of millions of dollars.

NAB's group executive of people and culture, Sarah White, emphasized the importance of paying colleagues correctly, apologized for the payroll issues, and committed to ongoing remediation efforts.

CEO Andrew Irvine acknowledged the payroll problems as disappointing but stressed the bank's focus on fixing them and maintaining long-term growth.

NAB reported a 4.5% increase in operating expenses for the year, largely due to costs associated with payroll issues and the ongoing review process.

National Australia Bank (NAB) announced it will allocate an additional $135 million in the 2025 financial year to address ongoing staff underpayment issues uncovered during a payroll review that began in 2019.

The bank expects to incur around $130 million in costs related to payroll issues, including wage underpayments and entitlements, which have affected its staff and prompted an apology and comprehensive review.

Despite these challenges, NAB's business banking loans increased by 4% in the quarter, with a record monthly lending growth of $4.6 billion in June, while home lending grew by 2%, aligning with market averages.

In its third-quarter trading update, NAB reported nearly $1.8 billion in profit for the three months ending June, unchanged from the previous year, driven by growth in business banking and home lending.