The National Australia Bank Ltd (ASX: NAB) share price is waltzing through today's session in the green.
This comes after reports it will allocate $20 million to its private wealth arm JBWere Pty Ltd.
At the time of writing, National Australia Bank (NAB) shares are changing hands at $26.27, having retreated from their intraday high of $26.52.
Let's discuss what the planned investment entails in a little more detail.
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What does this mean?
NAB is prioritising its suite of environmental, sustainable, and governance (ESG) investment products for the upcoming generation of investors.
Thus, JBWere will use the capital to reshape and rebuild its wealth management platform over the coming year.
This means, first and foremost, that all of JBWere's users' financial advice will now be digitised.
However, the upgrade also provides an "institutional grade" access portal to private markets, in addition to responsible and ethical investing features.
Ethical-type investing, under the banner of ESG, has become a mainstay and is a "non-negotiable" amongst wealth managers in the current climate, according to the company.
Speaking to yesterday's Australian Financial Review, JBWere head of private wealth Justin Greiner stated:
The children of today's clients, who are inheriting the wealth, have different views about sustainability and impact…They want to do more with their investments than just to make money.
Speaking further on the capital allocation, Greiner said:
We're going to use this money to really grow digital adoption.
These moves come shortly after NAB also divested from MLC Wealth, its former retail financial services business, in a $1.4 billion sale to IOOF Holdings Limited (ASX: IFL).
NAB shares slipped ~2% into the red following the divestiture.
NAB share price snapshot
Shares in the Australian banking giant have climbed ~17% this year to date, extending a 12-month return of 45%.
The NAB share price has outpaced the S&P/ASX 200 Index (ASX: XJO) which has posted a year-to-date return of ~12%.
At the time of writing, NAB has a market capitalisation of $87 billion.
NAB also recently paid a dividend of 90 cents per share, fully franked.
