Wednesday saw National Australia Bank (NAB) confirming that with the aim of enhancing its balance sheet as bad debts rise in a tough economic climate, it will raise up to 2.75 billion dollars (2.24 billion US) in a share issue.

It was revealed by NAB - whose bad debts rose to 1.064 billion for the June quarter - that stocks worth two billion dollars would be sold to institutional investors, with up to
750 million dollars' stocks to be offered to small shareholders.

Through a statement, chief executive Cameron Clyne said: "This capital raising not only ensures we maintain a strong balance sheet position, but also provides us with the flexibility to support our existing customers."

During the month of April, NAB specified that half-year bad debts were 1.8 billion dollars, higher from just 700 million a year earlier.

It should be noted though that the performance of the bank remained impressive in spite of the global downturn. The credit crisis, which harmed other institutions around the world notably, was not able to harm banks of Australia.

Clyne stated, "Our businesses continue to deliver solid performance despite the subdued economic environment."