Exhibit 10.78


                              EMPLOYMENT AGREEMENT


          This EMPLOYMENT AGREEMENT (the "Agreement") is made as of the 17th day
of May, 2001(the  "Effective Date"), by and between HomeSide Lending,  Inc. (the
"Company"), a Florida corporation,  National Australia Bank Limited ("Parent") a
company organized under the laws of Australia and Kevin D. Race ("Executive").

                              W I T N E S S E T H:
                              --------------------

          WHEREAS,  Executive,  Parent,  and  the  Company  are  parties  to  an
employment agreement (the "Prior Agreement"), dated as of October 25, 1997, that
provides  Executive  with  certain  rights and  benefits  during the term of his
employment and in the event of his termination of employment with the Company;

          WHEREAS,  the  parties  hereto  desire to amend and  restate the Prior
Agreement in the interest of encouraging the Executive's  continuing  employment
with the Company; and

          WHEREAS,  the Board of  Directors  of the Company  (the  "Board")  has
determined  that it is in the  Company's  best  interests  to  enter  into  this
Agreement.

          NOW,  THEREFORE,  in  consideration of the premises and the respective
covenants and  agreements  contained  herein,  and intending to be legally bound
hereby, the parties hereto agree as follows:

          1.   Employment.  The Company  hereby  agrees to employ  Executive and
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Executive  hereby  agrees  to be  employed  by  the  Company  on the  terms  and
conditions herein set forth for a period (the "Term") of two years commencing on
the Effective Date,  subject to any written agreement in which the parties agree
that the Agreement be further extended for one or more additional  periods or be
sooner terminated.  Notwithstanding  anything herein to the contrary, where this
Agreement  authorises the Company to take any action or make any  determination,
delivery  or  transmission,  the term  "Company"  shall be deemed to include the
Company and the Parent equally.

          2.   Duties.  Executive  is  engaged by the  Company  in an  executive
               ------
capacity as  President  and Chief  Operating  Officer.  A brief  description  of
Executive's  duties and  responsibilities  is attached as Exhibit A.  Executive,
subject to the  direction  and  control  of the Board,  shall have the power and
authority  commensurate  with his executive  status and necessary to perform his
duties hereunder. Executive shall devote his entire business time, attention and
best efforts to the business of the Company,  and shall not, without the consent

<PAGE>

of the Board, be actively engaged in any other business activity, whether or not
such business activity is pursued for gain, profit or other pecuniary advantage;
but this shall not be construed  as  preventing  Executive  from  investing  his
assets in such form or manner as will not  require any  substantial  services on
the part of Executive in the  operation of the affairs of the companies or other
entities in which such investments are made.  Notwithstanding anything herein to
the contrary,  during the Term Executive  shall not be the  beneficial  owner of
more than 5% of all  categories of stock of any company that is publicly  traded
on an  exchange  in the U.S.  or any other  jurisdiction.  For  purposes  of the
foregoing  sentence,  "Executive"  shall  include  Executive  and members of his
immediate family.

          3.   Prior  Agreement.  This  Agreement  constitutes  an amendment and
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restatement of the Prior  Agreement.  Therefore,  the parties hereto agree that,
effective as of the Effective  Date,  the Prior  Agreement is hereby amended and
restated in its  entirety and thus,  except as herein  provided and except as to
accrued and unpaid salary,  bonuses and other benefits in favor of the Executive
(including  without  limitation,  the "ABP" and "LTIP" in effect  thereunder for
current  periods),  upon and following the  Effective  Date the Prior  Agreement
shall be void and of no further effect,  and shall be superseded in its entirety
by this Agreement, except as herein stated.

          4.   Compensation.  As compensation for services  hereunder  rendered,
               ------------
Executive shall receive during the Term:

               (a) A base  salary  ("Base  Salary")  of  U.S.$400,000  per  year
payable in accordance with the Company's normal payroll  procedures as in effect
from  time to time,  and  reviewed  at least  annually  by the  Parent  Managing
Director.

               (b)  (i)Executive  is eligible to  participate  in the  Company's
annual  bonus plan as in effect from time to time (the  "ABP").  The award under
the ABP payable to Executive in connection  with the Company's  performance  for
its  fiscal  year  ending  September  30,  2001 (i) shall be paid no later  than
December 1, 2001, and (ii) shall be determined in accordance  with the ABP as in
effect on the Effective  Date,  with the exact amount of such award to Executive
to be determined in accordance with the provisions of the ABP and recommended by
the Parent Managing Director,  taking into consideration Executive's performance
and  contributions to the Company for such period.  (ii) Awards under the ABP in
respect of periods beginning after September 30, 2001 shall be based upon a plan


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<PAGE>

to be mutually agreed between the Company and Parent on or before  September 30,
2001.  The  criteria to be  considered  in agreeing  the plan shall  include the
National  Australia Bank Group's  Economic  Value Added  Incentive Plan and such
targets and other  criteria as may be agreed in good faith  between  Company and
Parent.  Awards pursuant to such plan shall be determined in accordance with the
provisions of the plan and recommended by the Parent Managing  Director,  taking
into consideration  Executive's  performance and contributions to the Company in
respect of the award  period.  The  timing of the  payment to be made will be in
accordance with the provisions of the ABP.

               (c) Executive shall be considered for participation in any offers
made under the National  Australia Bank  Executive  Share Option Plan No. 2 (the
"Plan") in accordance with the Plan rules as applicable from time to time.

               (d) (i) On or before  April 1, 2001 (the "Start  Date") but in no
event later than July 1, 2001, the Company and Parent shall  formally  execute a
long-term  incentive plan (the "LTIP") that provides for awards for the two-year
period (the "LTIP  Period")  commencing  on the Start Date (with the last day of
such period,  March 31, 2003,  being the "LTIP Program  Date").  . New financial
targets shall be as mutually and reasonably  agreed between  Company and Parent.
The criteria to be considered in agreeing the LTIP shall include  Economic Value
Added and such targets and other criteria as may be agreed in good faith between
Company and Parent. The award under the LTIP (the "LTIP Award") shall be payable
in  accordance  with the  provisions  of the LTIP,  provided  the  Executive  is
employed  by the  Company  or an  affiliate  on the last day of the LTIP  Period
(except as provided in Section 7 hereof).  The Company shall make  provision for
the LTIP pool (the "LTIP Pool") in an amount as determined  in  accordance  with
the foregoing criteria of the LTIP;  provided that the target LTIP Pool shall be
US $10 million.

          The exact  amount of  Executive's  LTIP Award shall be  determined  in
accordance  with the provisions of the LTIP and  recommended by Parent  Managing
Director,  taking into consideration Executive's performance and contribution to
the  Company.  The  Company  shall  cause  the  entire  earned  LTIP  Pool to be
distributed to eligible Company executives.

          (ii)  During  the  LTIP  Period  if (A)  Parent  is the  subject  of a
successful takeover,  or (B) Parent sells the Company, then the target LTIP Pool
shall fully vest and become  available for  distribution  in accordance with the
provision of the LTIP.

          For the purpose of this sub-clause (ii) the term "successful takeover"
     means the acquisition by another party,  unrelated to the Parent, of all of
     the  issued  capital of Parent;  and the term  "sells"  means a sale by the
     Parent of the whole of the  Company.  The  provisions  of Clause 4 (d) (ii)
     shall not apply at any time that Parent maintains at least 50% ownership or
     control of the Company.

          (iii) (A) In the event that  Parent  enters into any form of change of
     ownership  or control of the Company or other form of business  combination
     by which Parent's ownership or control will become less than 50%, it is the
     intention  of Parent that the Company not be  disadvantaged  nor  precluded
     from its capacity to realize the financial  targets or other criteria under
     Clause 4(d)(i).


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<PAGE>

                (B) Where  sub-clause (A) above  applies,  the parties will work
     together with the proposed  owner(s) or partial  owner(s) of the Company in
     good faith to agree upon the disadvantages (if any) suffered by the Company
     and the best way to neutralize the impact of any such disadvantage.  In the
     absence  of  agreement,  the  matter in  dispute  shall be  referred  to an
     external  arbitrator who will determine the extent of the disadvantage,  if
     any,  quantify that disadvantage and determine the adjustments to financial
     targets and other criteria necessary to neutralize the disadvantage,  based
     on the  circumstances  as  presented  by the  Company,  Parent and proposed
     owner(s)  or  partial  owner(s),  in  accordance  with  Section  9 of  this
     agreement.  Upon determination of the arbitrator,  Parent must, in its sole
     discretion,  either procure the adjustments determined by the arbitrator or
     cause  the  target  LTIP  pool to vest  immediately  to the  extent  of any
     disadvantage as determined by the arbitrator.

         5.   Benefits.
              ---------

              (a)  Executive  shall be  eligible to  participate  in any and all
employee  retirement benefit,  welfare benefit  (including,  without limitation,
medical, dental, disability and group life insurance coverages), fringe benefit,
and  other  benefit  plans as may be in  effect  from  time to time  for  senior
executives of the Company,  provided that during the Term of this  Agreement the
Executive's  aggregate  benefits  under  such  plans are not less  favorable  to
Executive than those benefits in effect on the Effective Date.

              (b)  Executive  shall be  entitled to paid  vacation  each year in
accordance with the policy  applicable to senior executives of the Company as in
effect from time to time.

              (c)  Executive  may incur  reasonable  expenses for  promoting the
Company's  business,  including expenses for  entertainment,  travel and similar
items.   The  Company  shall   reimburse   Executive  in  accordance   with  its
reimbursement policy as in effect from time to time.

              (d)  Executive shall be entitled to receive the same perquisitesin
effect on the Effective Date,  including,  without  limitation,  country club or
luncheon club dues,  financial and tax planning  services,  an annual  executive
physical and coverage under Executive's long-term disability policy.

              (e)  Executive shall continue to be eligible to participate in the
Company's deferred  compensation plan as in effect from time to time pursuant to
which plan Executive may, at Executive's  election,  contribute to such plan any
amount of Executive's  cash  compensation up to the maximum amount allowed to be
contributed  by Executive  under the terms of such deferred  compensation  Plan;
provided that the Company shall at least once per calendar year  contribute to a
"rabbi  trust"  (established  with an  independent  trustee in  accordance  with
Revenue  Procedure 92-64) an amount necessary to fully offset any liability that

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<PAGE>

the Company may have to the Executive or his  beneficiaries  with respect to any
deferred compensation.

         6.   Termination of Employment.
              -------------------------

              (a) Death or Disability.  Executive's  employment  shall terminate
                  -------------------
automatically  upon Executive's death during the Term. If the Company determines
in good faith that the  Disability  of Executive  has  occurred  during the Term
(pursuant  to the  definition  of  Disability  set  forth  below) it may give to
Executive written notice of its intention to terminate  Executive's  employment.
In such event, Executive's employment with the Company shall terminate effective
on the 30th day after  receipt  of such  notice by  Executive  (the  "Disability
Effective  Date"),  provided  that,  within  the 30  days  after  such  receipt,
Executive  shall not have  returned  to  full-time  performance  of  Executive's
duties. For purposes of this Agreement,  "Disability" shall mean the Executive's
absence  from the  full-time  performance  of his duties with the Company or the
Executive's  inability to  adequately  perform his duties with the Company for a
total of six months in any twelve month period due to the  Executive's  physical
or mental illness.

              (b) Cause. The Company may terminate Executive's employment during
                  -----
the Term for Cause. For purposes of this Agreement, "Cause" shall mean only:

                  (i) the willful  failure (not  resulting  from  Disability) by
Executive to perform  substantially  Executive's duties with the Company after a
demand for substantial performance is delivered to Executive by the Board;

                  (ii) gross  negligence  or willful  misconduct by Executive in
the execution of Executive's  professional duties which is materially  injurious
to the Company;

                  (iii)  conviction  of Executive  of, or a plea by Executive of
guilty or nolo contendere to, a felony;

                  (iv) use by Executive of alcohol or drugs or other  controlled
substances which interferes with the performance of Executive's duties hereunder
or which compromises the integrity of the Company, its affiliates, its employees
or its products; or

                  (v) willful breach by Executive of a material policy,  program
or rule of the Company.

         For purposes of clauses (i), (ii), (iv) and (v),  above,  "Cause" shall
not exist  until  after  Company  has given the  Executive  written  notice (the
"Company  Notice") of the  applicable  event,  action or  circumstance  and such
event,  action or  circumstance is not remedied within 30 days after his receipt
of the Company Notice  specifically  delineating  such claimed event,  action or


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<PAGE>

circumstance  and  setting  forth  the  Company's  intention  to  terminate  the
Executive's employment if not remedied;  provided,  that if the specified event,
action or circumstance  cannot  reasonably be remedied within such 30-day period
and the Executive commences reasonable steps within such 30-day period to remedy
such  event,  action  or  circumstance  and  diligently   continues  such  steps
thereafter until a remedy is effected,  such event, action or circumstance shall
not  constitute  "Cause"  provided that such event,  action or  circumstance  is
remedied within 60 days after receipt of the Company  Notice.  In each case, the
Company Notice must be approved by the Board at a meeting duly called and held.

         No act,  or failure to act,  on  Executive's  part shall be  considered
"willful"  unless  done,  or omitted to be done,  by  Executive  in bad faith or
without  reasonable  belief that such action or omission  was in, or not opposed
to, the best  interests of the Company.  Any act, or failure to act,  based upon
advice of counsel for the Company shall be conclusively  presumed to be done, or
omitted to be done, by Executive in good faith and in the best  interests of the
Company.

              (c) Good  Reason.  Executive's  employment  may be  terminated  by
                  ------------
Executive  for Good  Reason.  "Good  Reason"  shall  exist upon the  occurrence,
without Executive's express written consent, of any of the following events:

                   (i)  the  Company  shall  assign  to  Executive  duties  of a
substantially  nonexecutive or nonmanagerial  nature that are inconsistent  with
Executive's  duties as  contemplated  under this  Agreement,  excluding for this
purpose an  isolated  action not taken in bad faith and which is remedied by the
Company promptly after receipt of notice thereof given by Executive;

                   (ii) a material adverse change in Executive's  position as an
executive  officer of the Company,  including,  without  limitation,  an adverse
change in  Executive's  position  as a result  of a  significant  diminution  in
Executive's  duties or  responsibilities,  other  than an  isolated  change  not
occurring  in bad faith and which is  remedied  by the  Company  promptly  after
receipt of notice thereof given by Executive ;

                   (iii)  the  Company  shall  reduce  the Base  Salary  [or ABP
opportunity] of Executive,  or materially  reduce his benefits and  perquisites,
other  than an  isolated  reduction  not  occurring  in bad  faith  and which is
remedied  by the  Company  promptly  after  receipt of notice  thereof  given by
Executive;

                   (iv) the  Company  shall  default  in  performing  any of its
material obligations contained in this Agreement; or

                   (v)  the  Company   shall   require   Executive  to  relocate
Executive's   principal  office  beyond  a  radius  of  fifty  (50)  miles  from
Executive's principal office as of the Effective Time.


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<PAGE>

         For purposes of this  Agreement,  "Good  Reason"  shall not exist until
after  Executive  has given the Company  written  notice (the  "Notice")  of the
applicable  event  within 30 days of such event and such  event is not  remedied
within 30 days after receipt of the Notice specifically delineating such claimed
event and setting  forth  Executive's  intention to terminate  employment if not
remedied;  provided,  that if the specified event cannot  reasonably be remedied
within such 30-day period and the Company commences reasonable steps within such
30-day  period  to  remedy  such  event  and  diligently  continues  such  steps
thereafter  until a remedy is effected,  such event shall not  constitute  "Good
Reason" provided that such event is remedied within 60 days after receipt of the
Notice.

              (d) Notice of  Termination.  Any  termination  by the  Company for
                  ----------------------
Cause,  or by Executive  for Good  Reason,  shall be  communicated  by Notice of
Termination  given in  accordance  with this  Agreement.  For  purposes  of this
Agreement,  a "Notice of Termination" means a written notice which (i) indicates
the specific  termination  provision in this  Agreement  relied upon,  (ii) sets
forth in  reasonable  detail  the facts and  circumstances  claimed to provide a
basis  for  termination  of  Executive's   employment  under  the  provision  so
indicated, and (iii) specifies the intended termination date (which date, in the
case of a termination for Good Reason,  shall be not more than thirty days after
the giving of such notice). The failure by Executive or the Company to set forth
in the Notice of Termination  any fact or  circumstance  which  contributes to a
showing of Good  Reason or Cause shall not waive any right of  Executive  or the
Company,   respectively,   hereunder  or  preclude  Executive  or  the  Company,
respectively,  from asserting such fact or circumstance in enforcing Executive's
or the Company's rights hereunder.

              (e)  Date of  Termination.  "Date  of  Termination"  means  (i) if
                   --------------------
Executive's  employment is terminated by the Company for Cause,  or by Executive
for Good Reason, the later of the date specified in the Notice of Termination or
the date that is one day after the last day of any applicable cure period,  (ii)
if  Executive's  employment is terminated by the Company other than for Cause or
Disability,  or Executive  resigns without Good Reason,  the Date of Termination
shall be the date on which the Company or  Executive  notified  Executive or the
Company,  respectively,  of such termination and (iii) if Executive's employment
is terminated by reason of death or Disability, the Date of Termination shall be
the date of death of Executive or the Disability Effective Date, as the case may
be.

              (f)  Resignation  by  Executive.  Upon  thirty  (30) days  written
                   --------------------------
notice, which notice the Company may waive in its sole discretion, Executive may
voluntarily  terminate  Executive's  employment  with the Company for any reason
without  penalty or any  liability to the Company for any  damages,  expenses or
other costs;  provided,  that in such event Executive waives any amounts payable
to  Executive  under  this  Agreement;   provided,   further,  that  Executive's
obligations under that certain  Confidentiality and  Nonsolicitation  Agreement,
dated as of the date hereof, shall remain unaffected by such resignation.



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<PAGE>

         7.   Obligations  of  the  Company  Upon  Termination.   Following  any
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termination of Executive's employment hereunder, the Company shall pay Executive
his Base Salary to the extent not already paid  through the Date of  Termination
and any amounts owed to Executive  pursuant to the terms and  conditions  of the
employee benefit plans and programs of the Company at the time such payments are
due.  In  addition,  Executive  shall be entitled  to the  following  additional
payments:

              (a)  Death  or  Disability.   If,  during  the  Term,  Executive's
                   ---------------------
employment  shall  terminate by reason of Executive's  Death or Disability,  the
Company shall pay to Executive (or his designated  beneficiary or estate, as the
case may be) the prorated  portion based on Date of  Termination  of (i) any ABP
award  Executive  would have received for the year of termination of employment,
and (ii) any LTIP Award that would have been payable to  Executive  for the LTIP
Period.  The amounts  payable under this Section 7(a) shall be paid at the times
when such payments would have been paid to Executive had Executive's  employment
not been terminated.

              (b) Good Reason;  Other than for Cause.  If, during the Term,  the
                  ----------------------------------
Company shall terminate Executive's  employment for any reason other than either
(i) Cause or (ii)  Disability,  or the Executive  shall terminate his employment
for Good  Reason,  the  Company  shall (A) in the event of such  termination  of
employment  on or before the LTIP Program  Date,  pay to Executive the amount of
Executive's LTIP Award,  payable within 30 days following the LTIP Program Date,
(B) (i) pay to  Executive  an  amount  equal to the  Base  Salary  as in  effect
immediately  preceding the Date of  Termination,  that the Executive  would have
received for the period of 24 months  following  Executive's Date of Termination
(the  "Continuation  Period"),  and (ii) pay to Executive an amount equal to 1.5
times the average of (x) Executive's  target bonus under the ABP for the year in
which Executive's Date of Termination  occurs and (y) the annual bonus under the
ABP for the year  immediately  preceding the year in which  Executive's  Date of
Termination  occurs,  and  (iii)  pay to  Executive  the  pro  rata  portion  of
Executive's  ABP award for the year of termination of employment,  provided that
the  Company's  performance,  or  where  applicable,  the  Group's  performance,
warrants such award, and (C) provide  Executive  during the Continuation  Period
with  continued  coverage  under  the  Company's  health,  life  and  disability
insurance  plans,  provided that Executive  continues to contribute the employee
share of the cost  applicable to such  coverage and,  provided such benefits are
secondary  to any other  coverage  obtained by  Executive  during such  coverage
period.  Executive must advise the Company of any other coverage obtained during
the Continuation  Period.  Amounts payable to Executive pursuant to subparagraph
(B) above shall be paid in a lump sum within 30 days following  Executive's Date
of  Termination  unless  Executive  elects more than 120 days before the Date of
Termination  to  defer  their  receipt  pursuant  to the  nonqualified  deferred
compensation arrangement described in Section 5(e) hereof.

              (c) Cause;  Other than for Good Reason. If Executive's  employment
                  ----------------------------------
shall be terminated by the Company for Cause or Executive terminates  employment


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<PAGE>

without Good Reason (and other than due to such Executive's Death or Disability)
during the Term,  this Agreement  shall  terminate  without  further  additional
obligations to Executive under this Agreement.

         8.  Death  after  Termination.  In the event of the death of  Executive
             -------------------------
during the period  Executive is receiving  payments  pursuant to this Agreement,
Executive's  designated  beneficiary shall be entitled to receive the balance of
the  payments  in a single  lump sum  payment as soon as  practicable  following
Executive's  death; or in the event of no designated  beneficiary,  the lump sum
shall be made to Executive's estate.

         9. Arbitration.  Any dispute or controversy arising under or in respect
            -----------
of this  Agreement  or the  employment  relationship  between  the  Company  and
Executive shall be settled  exclusively by arbitration in Jacksonville,  Florida
in accordance with the arbitration procedures set forth in the attached Annex A.
Judgment  may  be  entered  on  the  arbitrator's  award  in  any  court  having
jurisdiction.  The Company shall bear all costs of arbitration.  Executive shall
be reimbursed for all costs and expenses,  including reasonable attorneys' fees,
arising from such dispute or controversy provided the arbitrators determine that
Executive has substantially prevailed in his claims.

         10.  Litigation.  To the extent any dispute is not resolved pursuant to
              ----------
Section 9 hereof, as to the terms or  interpretation of this Agreement,  whether
instituted by formal legal  proceedings or otherwise,  including any action that
the Executive  takes to enforce the terms of this Agreement or to defend against
any action taken by the Company, the Executive shall be reimbursed for all costs
and expenses,  including reasonable  attorneys' fees, arising from such dispute,
proceedings  or  actions,  provided  that  the  Executive  shall  obtain a final
judgment by a court of competent  jurisdiction  in favor of the Executive.  Such
reimbursement  shall be paid within ten (10) days of the Executive's  furnishing
to the Company written  evidence,  which may be in the form, among other things,
of a  cancelled  check or  receipt,  of any costs or  expenses  incurred  by the
Executive.

         11.  Consent  to   Jurisdiction.   EXECUTIVE  AND  THE  COMPANY  HEREBY
              --------------------------
IRREVOCABLY  SUBMIT TO THE EXCLUSIVE  JURISDICTION OF ANY STATE OR FEDERAL COURT
LOCATED IN THE CITY OF JACKSONVILLE, FLORIDA OVER ANY SUIT, ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO OR  CONCERNING  THIS  EMPLOYMENT  AGREEMENT OR ANY
EMPLOYMENT  RELATED  MATTERS  THAT  ARE NOT  OTHERWISE  ARBITRATED  OR  RESOLVED
ACCORDING TO THE  PROVISIONS OF SECTION 9 OF THIS  AGREEMENT.  This includes any
suit,  action  or  proceeding  to  compel  arbitration,  to  obtain a  temporary
restraining  order or preliminary  injunction or such other temporary  emergency
relief,  or  to  enforce  an  arbitration  award.   Executive  and  the  Company
acknowledge that the forum  designated  above has a reasonable  relation to this
Agreement, and to Executive's  relationship to the Company.  Notwithstanding the


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<PAGE>

foregoing,  nothing herein shall preclude Executive or the Company from bringing
any action or  proceeding  in any other court for the purpose of  enforcing  the
provisions of Section 9 of this Agreement.

         This  agreement  as to  forum  is  independent  of the law  that may be
applied in the action under Section 19 of this Agreement,  and Executive and the
Company agree to such forum even if the forum may under applicable law choose to
apply  non-forum  law.  Executive and the Company  hereby waive,  to the fullest
extent  permitted by applicable law, any objection which either now or hereafter
may have to  personal  jurisdiction  or the  laying  of venue of any such  suit,
action  or  proceeding  in any court  referred  to in the  preceding  paragraph.
Executive undertakes not to commence any action arising out of or relating to or
concerning  the  Agreement  in any forum  other than a forum  described  in this
Section 11.

         12. Successors. (a) This Agreement is personal to Executive and without
the prior  written  consent of the Company  shall not be assignable by Executive
otherwise than by will or the laws of descent and  distribution.  This Agreement
shall  inure  to  the  benefit  of  and  be  enforceable  by  Executive's  legal
representatives.

              (b) This  Agreement  shall  inure to the benefit of and be binding
upon the Company and its successors and assigns.

              (c) The Company  will  require any  successor  (whether  direct or
indirect,   by  purchase,   merger,   consolidation  or  otherwise)  to  all  or
substantially all of the business and/or assets of the Company,  or any business
of the Company for which  Executive's  services are  principally  performed,  to
assume  expressly and agree to perform this  Agreement in the same manner and to
the same  extent  that the  Company  would be  required to perform it if no such
succession had taken place. As used in this Agreement,  "Company" shall mean the
Company as hereinbefore  defined and any successor to its business and/or assets
as aforesaid  which assumes and agrees to perform this Agreement by operation of
law, or otherwise.

         13.  Other  Severance   Benefits.   Executive  hereby  agrees  that  in
              ---------------------------
consideration  for the payments to be received under this  Agreement,  Executive
waives any and all rights to any payments or benefits under any plans, programs,
policies,  contracts or arrangements of Parent,  the Company or their respective
affiliates that provide for severance payments or benefits upon a termination of
employment.

              14.  Withholding.  All payments to be made to Executive  hereunder
                   -----------
will be  subject  to all  applicable  required  withholding  of any  income  and
employment taxes.

              15. No  Mitigation.  Executive  shall have no duty to mitigate his
                  --------------
damages by seeking other  employment  and,  should  Executive  actually  receive

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<PAGE>

compensation  from any such other employment,  the payments  required  hereunder
shall not be reduced or offset by any such compensation.

              16.  Notices.  Any notice  required or permitted to be given under
                   -------
this  Agreement  shall be in writing and shall be deemed to have been duly given
when  delivered  or  sent  by  telephone  facsimile  transmission,  personal  or
overnight couriers,  or registered mail with confirmation of receipt,  addressed
as follows:

                           If to Executive:

                           8140 Presidential Drive
                           Jacksonville, FL 32256


                           If to Company:

                           7301 Baymeadows Way
                           Jacksonville, Florida  33256

                           If to Parent:

                           24th Floor 500 Bourke Street
                           Melbourne, Victoria  3000
                           Australia

         17. Waiver of Breach and Severability.  The waiver by either party of a
             ---------------------------------
breach of any  provision of this  Agreement by the other party shall not operate
or be construed as a waiver of any  subsequent  breach by either  party.  In the
event any provision of this  Agreement is found to be invalid or  unenforceable,
it may be  severed  from  the  Agreement  and the  remaining  provisions  of the
Agreement shall continue to be binding and effective.

         18. Entire Agreement;  Amendment.  This instrument  contains the entire
             ----------------------------
agreement of the parties and supersedes all prior agreements (including, but not
limited   to,  the  Prior   Agreement),   promises,   covenants,   arrangements,
communications,  representations and warranties between them, whether written or
oral.  No provisions  of this  Agreement  may be modified,  waived or discharged
unless such modification,  waiver or discharge is agreed to in writing signed by
Executive and such officer of the Company specifically designated by the Board.

         19. Governing Law. This Agreement shall be construed in accordance with
             -------------
and  governed  by the  laws  of the  State  of  Florida,  without  reference  to
principles of conflict of laws.



                                       11
<PAGE>

         20.  Headings.  The headings in this Agreement are for convenience only
              --------
and shall not be used to interpret or construe its provisions.

         21.  Counterparts.  This  Agreement  may be  executed  in  two or  more
              ------------
counterparts,  each of  which  shall  be  deemed  an  original  but all of which
together shall constitute one and the same instrument.




















                                       12
<PAGE>

         IN WITNESS WHEREOF,  the parties have executed this Agreement as of the
date first above written.

                                              NATIONAL AUSTRALIA BANK LIMITED


                                              By: _____________________________



                                              HOMESIDE LENDING, INC.


                                              By: _____________________________


                                                   KEVIN D. RACE

                                                  ___________________, Executive















                                       13
<PAGE>


ANNEX A


Any  arbitration  brought to enforce the provisions of this  Agreement  shall be
settled in accordance with the following arbitration procedures:



         (i)      The  arbitration  shall be  conducted  before a panel of three
                  arbitrators  to be selected  as provided in the AAA Rules.  No
                  potential  arbitrator  may serve on the panel unless he or she
                  has  agreed in  writing  to abide by these  procedures  and be
                  bound by their requirements.

         (ii)     Discovery will be permitted in connection with the arbitration
                  if   authorized   by  the   arbitration   panel   based  on  a
                  determination of reasonable need for the discovery.

         (iii)    The arbitrators have no power (A) to alter, amend or otherwise
                  affect  the  terms of the  employment  Agreement  or (B) award
                  punitive  damages  (except  such  punitive  damages  as may be
                  provided  for by  statute  and  which  may  not be  waived  by
                  agreement) or any damages  (except for the liquidated  damages
                  amount specified in the employment  Agreement) not measured by
                  the   prevailing   party's  actual  damages  and  the  parties
                  therefore  waive their right to any such  damages  (except the
                  liquidated  damages amount and such punitive damages as may be
                  provided  for by  statute  and  which  may  not be  waived  by
                  agreement).

         (iv)     Nothing  contained  herein shall  prevent a party from seeking
                  temporary  emergency relief with respect to a dispute. A party
                  may apply to a court,  as  provided  for in Sections 9 and 10,
                  for a temporary restraining order, preliminary injunction,  or
                  such other temporary emergency relief.  Neither an application
                  for temporary emergency relief, nor a court's consideration or
                  granting of such relief  shall (A)  constitute a waiver of the
                  right to pursue arbitration under this provision, or (B) delay
                  the  appointment of any  arbitration  panel or the progress of
                  arbitration proceedings.

                  If any of these arbitration  procedures is declared invalid or
                  unenforceable,  such  part  shall be  deemed  modified  to the
                  extent   necessary   and  possible  to  render  it  valid  and
                  enforceable.  In any event, the unenforceability or invalidity
                  of any part shall not affect any other part of this provision,
                  and this  provision  shall  continue in full force and effect,
                  and be construed  and  enforced,  as if such part had not been
                  included,  or had been modified as above provided, as the case
                  may be.





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