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Corporate governance failure and its impact on National Australia Bank's performance
The National Australia Bank (NAB) is the largest financial services institution listed on the Australian stock exchange and is within the 30 most profitable financial services organisation in the world. In January 2004, the bank disclosed to the public that it had identified losses relating to unauthorised trading in foreign currency options amounting to AUD360 million. This foreign exchange debacle was classified as operational risk, the risk of loss resulting from inadequate or failed processes, people, or systems and reiterated the importance of corporate governance for banks. Concurrent issues of National Australia Bank’s AUD4.1 billion loss on US HomeSide loans in 2001, the degree of strength of their risk management practices and lack of auditor independence, were raised by the US Securities and Exchange Commission in 2004, reinforcing the view that corporate governance had not been given the priority it deserved over a number of years. This paper will assess and critically analyse the impact of corporate governance failure by management and Board of Directors on NAB’s performance over the years 2001-2005.
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Journal of business case studiesVolume
2Issue
1Pagination
41 - 55Publisher
The Clute Institute for Academic ResearchLocation
Littleton, Colo.ISSN
1555-3353Language
engPublication classification
C1 Refereed article in a scholarly journalCopyright notice
2006, The Clute Institute for Academic ResearchUsage metrics
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