If you ask me, NAB has poor management

The annual meeting of the National Australia Bank Limited (ASX:NAB) will generate questions from shareholders and the Finance Sector Union. However,shareholders will also be asked to approve a $1 million retention incentive for the bank's finance officer as part of a package of short-term share incentives for senior managers, including CEO John Stewart. The Finance Sector Union is concerned over the relocation of jobs to India, as 250 credit-processing jobs have already gone. NAB shareholders are generally content, as the bank's share price rose by 20% in 2006.

I have to ask why the banks finance officer thinks he should get a $1 million retention incentive. Any sane person could produce the same result without the incentive. This looks like management trying to scratch each others back and wasting shareholder money. Banks make money cause the have lots of fees, they don't make it cause they have this one person on the team. If National Australia Bank was making a higher profit margin than the other banks then I could understand some sort of incentive but $1 million is way too steep and seems ridiculous.

While banks are a good investment long term you need to have the right type of managers in place that will not abuse the system and NAB does not look like they have it sorted yet. I will steer clear of NAB and instead look to invest in the management of other banks such as Macquarie Bank Limited(ASX:MBL) and St George Bank Limited (ASX:SGB). At least I have confidence in the management of these other banks.

Good Luck Investing