The National Australia Bank was able to deliver earnings amounting to $1.4 billion in the June quarter as local and affiliate banks have contributed to business growth in spite the difficult conditions in the local and international markets.

"NAB's strategy continued to deliver earnings momentum during the June quarter, with contributions from each of the Group's banking businesses in Australia, New Zealand and the United Kingdom," National Australia Bank Group Chief Executive Officer Cameron Clyne said in a briefing with financial investors on Tuesday.

The latest result was up from the $1.1 billion recorded in the June quarter last year and compares to a first half profit of $2.7 billion

Mr Clyne said that the earnings growth was achieved in spite the considerable challenges including Australia's multi-speed economy, subdued system credit growth and fragile consumer confidence in all the markets in which NAB operate, and mounting external concerns about US economic growth and European sovereign debt.

He noted that business banking revenue and improved market share as well as the reliable segment of personal banking boosted the NAB to perform well during the quarter.

"Operating conditions for MLC & NAB Wealth were challenging with some weakness in equity markets. There was also a further increase in insurance claims. In Wholesale Banking, currency and interest rate markets provided limited trading opportunities, resulting in lower income. Customer demand for risk management products was moderate but cross-sell initiatives assisted in supporting sales," he explained.

Offshore banking

NAB's New Zealand Banking unit, despite the Christchurch earthquakes and slow recovery from recession, recorded sound earnings and revenue growth, with continued good expense management.

UK Banking coped well with the slow credit environment with better than industry average growth in business lending and mortgages. Great Western Bank remained well positioned in the key agribusiness states, despite subdued economic conditions for the United States overall.

"Credit quality has stabilised and leading asset quality indicators have improved. "The Group continues to strengthen balance sheet ratios," Mr Clyne added.