National Australia Bank has cut dividends in an effort to pay compensation to customers after the royal commission.

The bank made a half year cash profit of $2.95 million, which was higher compared to last year.

They will cut board fees by 20 per cent and lower the dividend to 83c per share, rather than 99c.

NAB acting CEO Phil Chronican tells Ross Greenwood they are aware the cuts will affect shareholders.

“We know a large number of them are people who rely on bank stocks for income.

“But our job is, of course, to be forward-looking.”

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