Down 3.9% in afternoon trade, shares of National Australia Bank Ltd (ASX: NAB) are now trading ex-dividend.
That means shareholders on the company's registry as of last night are entitled to NAB's latest dividend, which will be paid on 3 July 2015.
Last week NAB, Australia's largest bank by assets, reported a cash profit of $3.32 billion, up 3.4% on the prior period and declared an interim dividend of 99 cents per share, fully franked, which was flat year-over-year.
Despite the good profit result it hasn't stopped NAB shares falling hard today, when the broader S&P/ASX 200 (Index: AXJO) (ASX: XJO) is trading marginally higher.
NAB recently pre-empted moves from APRA and rival banks to announce a $5.5 billion capital raising to firm-up its balance sheet ahead of (expected) tougher capital requirements and a UK divestment and the banks says it intends to pay another 99 cents per share distribution later in the year.
Therefore, based on its estimated full year payout, NAB shares currently trade on a dividend yield of 5.8% fully franked. Grossed-up for franking that's almost 8.3%!
…given the RBA just lowered its official interest rate to 2.00%…I'd say that's a very impressive return.
Should you buy NAB shares?
