EXHIBIT 4.31


 


Non-executive director
appointment letter – Mrs Patricia A Cross


 





















 


	
   

  	
  Michael A Chaney AO

  
	
   

  	
  Chairman

  
	
   

  	
   

  
	
   

  	
  500 Bourke Street

  
	
   

  	
  Melbourne

  
	
   

  	
  Victoria 3000

  
	
   

  	
  Australia

  



 


21 November 2005


 


Mrs PA Cross


 


 


 


Dear Tricia


 


Letter of appointment


 


I am pleased to confirm that at the Meeting of the Board of Directors
of National Australia Bank Limited (the “National”) held on 4 -5 August 2005,
the Board approved your appointment as a Non-Executive Director of the National
and National Equities Limited (the holding company for the major offshore
assets).


 


Such appointment was subject to the regulator, the Australian
Prudential Regulation Authority, having no objection to your appointment and
receipt of your signed Consent to Act as a Director.


 


I confirm that both of these conditions have been met.


 


The Company Secretary will send to you a form headed Staff in
Confidence which I would ask you to complete and return.  Through this you authorise the National to
undertake a police check on you as required by the National’s internal policies
and by the regulators.


 


In addition to expressing our delight that you have agreed to join the
Board of the National, this letter sets out the terms of your appointment to
the office of Non-Executive Director of the National and National Equities
Limited.  It should be read in
conjunction with, and is subject to, the National’s Constitution (a copy of
which will be provided to you by the Company Secretary), and the Charters and
policies approved from time to time by the Board, including the Board Charter
(a copy of which will also be provided to you). 
The Charters and policies may be changed by the Board from time to time.


 


Upon appointment as a Director, you will hold office until the next
Annual General Meeting of the National which will be held on 30 January 2006,
at which time you will be entitled to stand for election by the shareholders as
a Director of the National.


 


Please acknowledge that you have read,
understood and accept the contents of this letter by signing the enclosed copy
and returning it to the Company Secretary.


 


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1                                          Board
members


 


The Chairman of the Board is Mr Michael Chaney, a
Non-Executive Director.


 


The other Non-Executive Directors, at present, are:


 


•                                           Mr Peter Duncan;


 


•                                           Mr Robert Elstone


 


•                                           Mr Danny Gilbert;


 


•                                           Mr Paul Rizzo;


 


•                                           Ms Jillian Segal


 


•                                           Mr John Thorn;


 


•                                           Mr Geoff Tomlinson; and


 


•                                           Mr Malcolm Williamson.


 


Mr Kerry McDonald, who is Chairman of Bank of New
Zealand, will also join the Board as a Non-Executive Director on the same day
as yourself.


 


Mr John Stewart is the Managing Director &
Group Chief Executive.


 


The other executive directors, at present, are:


 


•                                     Mr Ahmed Fahour (Chief Executive, Australia)


 


•                                     Mr Michael Ullmer (Director, Finance & Risk)


 


The Company Secretary & Chief Governance
Officer is Mr Garry Nolan.  Mr Nolan can
be contacted on (03) 8641 3505.


 


Further details of the Board members can be obtained
from the Company Secretary.


 


2                                          Terms of
appointment


 


2.1                                Qualifications


 


To qualify for the office of Director of the National,
you must:


 


•                                           be under 70 years of age; [Article 10.9]


 


•                                           not be disqualified or suspended from managing corporations and must
otherwise be permitted by law to act as a director of a company; [s203B Corporations Act and Part 2D.6]


 


•                                        sign a Confidentiality Deed which prohibits you from disclosing any
matters, affairs or concerns of the National; [to comply
with Article 11.8 of the National’s Constitution] and


 


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•                                        hold at least 2,000 fully paid shares in the National in your own
right within two months after your appointment. 
[Article 10.8] See 3.6 below for restrictions.


 


2.2                                Term


 


Following your appointment by the Board, you hold
office until the first Annual General Meeting of the National after the date of
your appointment.  You are then eligible
for election to the position of Director by resolution of the shareholders of
the National at that Annual General Meeting. 
[Articles 10.12 and 10.13]


 


Once you have been elected to the office of Director
by resolution of the shareholders of the National in General Meeting, you will
be subject to the rotation of Directors provided for in Articles 10.3 to 10.7
of the National’s Constitution.  Broadly,
these Articles provide that at each Annual General Meeting one-third of the
Directors for the time being and any other Director not in such one-third who
has held office for three years or more must retire from the office and is
eligible for re-election.  Please refer
to the clause 3.8 – Performance evaluation, concerning the process undertaken
by the Board to determine if the Board will recommend to shareholders that a
Director be re-elected to office.


 


The National may remove a Director from office as a
Director at any time by a resolution passed at a General Meeting.  [Articles 10.3-10.7 and
10.14]


 


2.3                                Vacation
of office


 


Your office as a Director becomes vacant if any of the
circumstances prescribed under the Corporations Act 2001
(Cth) or the National’s Constitution arise, including the following:


 


•                                           you are disqualified from managing corporations; [s203B Corporations Act and Part 2D.6]


 


•                                           you resign from office or refuse to act; [Article 10.28(b)]


 


•                                           you are removed from office by resolution passed at a General Meeting
of the National; [Article 10.28(d)]


 


•                                           you are not present personally or by an alternate director or proxy
at meetings for a continuous period of two months without a leave of absence
from the Board; [Article 10.28(d)]


 


•                                           you accept or hold any office in another bank or funds management
company without the consent of the Board. 
[Article 10.28(f)]


 


Article 10.28 of the National’s Constitution
contains a list of circumstances that, in addition to those prescribed by the
Corporations Act, will result in the office of a Director becoming vacant.


 


Appointment and removal of Directors is a matter for
shareholders.  However, the Board has set
a policy limit of 10 years for individual service as a Director, subject to an
annual review thereafter.  The Board
regards this as an appropriate period of service.  This provided an opportunity for renewal of
the Board whilst recognising that Directors who have served on the Board for an
extended period of time have gained valuable experiences, insights and
historical perspectives regarding the National that would not be easily
replaced.  [Clause 7.5
of the Board Charter]


 


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2.4                                Relationship
with the National


 


Once appointed, you hold office as a Director of the
National.  You are not appointed or
designated as an employee of the National nor are you an Executive Director
within the meaning of the National’s Constitution.


 


3                                          Expectation


 


3.1                                Overview


 


The National’s expectations of you as a Director are
listed in this section.  In many cases,
you are obliged to meet these expectations because of your legal duties to the
National.  You are encouraged to seek
independent legal advice to assist you in the performance of these duties.


 


3.2                               Time commitment


 


You must
contribute sufficient time to your directorship to enable you to effectively
fulfil your duties to the National.  You
may also be expected to spend additional time if you are a Board Committee
Member or if you are the Chairman, or a director of a subsidiary of the National.


 


While most
Board and Board committee meetings are held in Melbourne, the Board does visit
and hold meetings at interstate and international venues from time to time.


 


You should
inform the Board of any change in circumstances that could affect your ability
to commit time to the position.


 


3.3                               Board meetings


 


Nine Board Meetings have been scheduled for 2006.  The duration of the Board Meetings will
normally be for one or two days, with the exception of the annual Board Meeting
in the United Kingdom which is scheduled to have a duration of three days.  A list of the Board Meeting dates for 2006
will be provided to you.  It is necessary
from time to time to convene an unscheduled meeting.  The National endeavours to keep such meetings
to a minimum, however, a Director may convene additional Board Meetings at any
time.  [Article 12.2]


 


You are expected to:


 


•                                           attend Board Meetings and ensure that you have fully read all papers
relating to agenda items;


 


•                                           apply your mind to the matters before you and bring your own special
skills and experience to your position;


 


•                                           raise questions and make enquiries when you need more information;


 


•                                           make sure that any of the Board’s delegates are qualified, reliable
and competent to carry out the duties given to them; and


 


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•                                           make sure that you have been provided with timely information that
appears accurate and relevant in reaching any decision that will affect the
National.  You should not make a
decision, and you may refuse to consider any matter, until appropriate
information has been provided to you.


 


3.4                                Board
Committees and Subsidiaries


 


Currently there are four standing Board
Committees:  the Audit Committee, Risk
Committee, Remuneration Committee and the Nomination Committee.  The Board may, from time to time, convene
other Board Committees.


 


At present, all Non-Executive Directors are members of
the Nomination Committee.


 


Directors are generally expected to serve on one
additional committee, and may be asked to serve on more than one, of these
Board Committees in accordance with the written Charters of those
Committees.  Charters for all Board
Committees are approved by the Board.


 


You may also be appointed as a director of a
subsidiary, or subsidiaries, of the National.


 


3.5                                Independence


 


Non-Executive Directors are appointed on the basis
that they remain independent of management and free from any business or other
relationship that could materially interfere with, or could reasonably be
perceived to materially interfere with, the exercise of their unfettered and
independent judgement.


 


The Board has approved the definition of ‘independence’
which is set out in the Board Charter.


 


The Board regularly reviews Director
independence.  You should immediately
report to the Board any change in your relationship or the relationship of your
associates with the National, or with its management team, which could affect
your independence.


 


3.6                                Insider
Trading Policy and Code of Conduct


 


Directors are expected to comply with the corporate
policies approved from time to time by the Board, including:


 


•                                     The National’s Insider Trading Policy;


 


•                                     The National’s Code of Conduct; and


 


•                                     The Corporate Governance Guide entitled “Role, Duties,
Responsibilities and Rights of the Directors of Category A Company”.


 


Copies of these key policies and codes will be
provided to you.


 


The Insider Trading Policy restricts dealings in
National securities by Directors as well as other officers and employees of the
National.  Directors may only deal in
such securities in the eight-week periods immediately following either the
release of the half-year and full-year profit announcements (currently made in May and
November) or following the release of a qualifying prospectus.  However, even during such periods, Directors
may not deal in National securities if they are aware of any share price
sensitive information that has not been released to the market.


 


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An example of this may be any merger, acquisition or
significant disposal activity occurring during the window period.  Further, under the Insider Trading Policy,
Directors must not deal in National securities for short-term gain and,
therefore, dealing in the same National securities within a 12-month period is
prohibited.  The Insider Trading Policy
also applies to derivatives over National securities.  Directors must also discuss their intention
to deal in National securities with the Chairman before undertaking any such
dealings.


 


Given these restrictions, a new Director appointed to
the Board, who does not already meet the Director share qualification
requirement set out in the National’s Constitution and clause 2.1 of this
letter, should acquire such shares as soon as possible before s/he acquires any
share price sensitive information.  I
note that you already meet your share qualification requirement.


 


3.7                                Confidentiality


 


You are expected to maintain the confidentiality of
all materials and information you obtain in connection with your position.  You are also expected to ensure that your
representative / personal assistant, if applicable, maintains the
confidentiality of such materials and information.


 


You must comply with the Confidentiality Deed you
execute in accordance with Article 11.8 of the National’s Constitution.


 


3.8                               Performance
evaluation


 


The Board regularly conducts an assessment of its
effectiveness using an external facilitator. 
This review may include an assessment of individual Director
performance.


 


In addition, in advance of you being presented to
shareholders for re-election in accordance with the retirement by rotation
provisions in the National’s Constitution, a peer review process is
undertaken.  That is, the Board (in your
absence) will consider whether the Board will make a recommendation to
shareholders in support of your re-election as a Director of the National.


 


The Nomination Committee will oversee the
implementation of this process.


 


4                                          Duties
and powers


 


4.1                                Duties


 


At the most
general level, your role is to oversee management on behalf of the National, to
monitor the National’s business results and to set goals and approve
strategy.  In performing this role, you
are subject to a number of legal duties to the National.


 


A detailed
explanation of your duties is provided in the Corporate Governance Guide
entitled “Role, Duties, Responsibilities and Rights of the Directors of
Category A Company” referred to earlier.


 


4.2                                Disclosure
of conflicts and material personal interests


 


If a conflict
of interest arises in relation to a matter that will be considered by the
Board, you must give the other Directors notice of the conflict, and, if the
conflict is a material personal interest in the matter (as defined by section 191(2) of
the Corporations Act), you must not be present while the matter is being
considered at a Board Meeting or vote on the matter.


 


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Further
guidance in relation to conflicts and material personal interests is given in
the Corporate Governance Guide.


 


4.3                                Powers


 


The Board has the power to exercise all of the
National’s powers, other than the powers which the Constitution and the
Corporations Act require to be exercised by the National in General
Meeting.  [Article 11.1
and s198A (2) of Corporations Act]


 


Decisions of the Board are decided by a majority of
votes of Directors present and entitled to vote.  Each Director has one vote.  [Articles 12.3 and 12.4]


 


4.4                                Appointment
of Alternate Director


 


Articles 12.6 - 12.14 of the National’s Constitution
provides for a Director to appoint an Alternate Director to act in his / her
place, subject to the approval of the majority of the other Directors.  However, it has not been the practice in the
National to appoint Alternate Directors.


 


5                                          Remuneration


 


5.1                                Remuneration


 


Non-Executive Directors do not participate in schemes
designed to remunerate executives and do not receive share options, performance
rights, bonuses or other types of performance based remuneration.


 


The National does not provide retirement benefits to
Non-Executive Directors, other than the superannuation payments described
below.


 


Each Non-Executive Director will receive the fees set
out in Schedule 1 of this letter for their directorship.


 


Additional fees are payable for membership of any
Board committees, subsidiary company directorships and for the position of
Chairman, in accordance with the National’s Constitution.


 


The Board approves these fees within the aggregate
limit set by the shareholders of the National in General Meeting.


 


Shares


 


Under the National’s Non-Executive Director Share
Plan, you will be provided at least 10% of your annual remuneration in the form
of National shares, except in limited, unusual circumstances.  There is flexibility to provide a maximum of
40% of your annual emoluments in the form of National shares.  Details of the Non-Executive Director Share
Plan will be provided to you.


 


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Superannuation


 


Directors may elect to receive part of their
remuneration in the form of superannuation contributions.  As a minimum, in accordance with the relevant
superannuation guarantee (“SG”) legislation, the National is generally obliged
to pay into an approved superannuation fund, superannuation guarantee contributions
on behalf of Directors at the rate of 9% of the fees (and any other amounts
which fall within the description of “ordinary time earnings” for SG purposes)
paid to you.


 


Other non-cash benefits


 


If required, the National will provide Directors with
a laptop computer to facilitate the electronic receipt of Board papers and
receipt of electronic communication material to enable Directors to effectively
perform their duties to the National. 
Subject to applicable law, financial services may also be provided by
the National to Directors under terms and conditions that would normally apply
to the public.  [Clause 13.5
of the Board Charter]


 


The Company Secretary will assist you to make
arrangements in this regard.


 


5.2                                Expenses


 


You are entitled to be reimbursed out of the funds of
the National such reasonable travelling, accommodation and other expenses as
you may incur when travelling to or from Board Meetings or Board Committee
Meetings or when you are otherwise engaged in the business of the
National.  [Article 10.18]  I should mention that it is the National’s
policy that no more than two Directors should travel by air together at any
time.


 


5.3                                Insurance
and indemnity


 


You have the benefit of the indemnity provided to you
in the National’s Constitution.  This
indemnity is broad; however, it does not provide protection if the National is
prohibited from indemnifying you, for example, where liability is owed to the
National.  [Article 21.1
and s199A (2) of the Corporations Act]


 


You are invited to enter into a Deed of Access,
Indemnity and Insurance which mirrors the protection afforded to you under the
National’s Constitution.  That deed also
includes an undertaking by the National to effect and maintain an appropriate
Directors’ and Officers’ Insurance Policy. 
A copy of that deed will be provided to you.  Could you please sign the deed and return it
at your convenience.


 


You may also be protected under the National’s
Directors & Officers Insurance Policy. 
Details of the insurance policy will be provided to you.


 


It is important that, if you become aware of any
matter that may give rise to an actual or potential claim, or of any
circumstances that may lead to such a claim, you contact the National’s Global
Operational Risk, Insurance & Compliance (Melbourne).


 


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6                                          Induction
and Training


 


6.1                               Induction


 


The National’s
Induction Program for Non-Executive Directors is designed to assist them to
participate fully and actively in Board decision-making from the date of
appointment.


 


The program
enables appointees to gain an understanding of:


 


•                                     the National’s financial, strategic,
operational and risk management position;


 


•                                     their rights, duties and responsibilities;
and


 


•                                     the role of Board Committees.


 


That National’s
Induction Program involves the supply of reading material, informal discussions
with the Group Chief Executive and Executive General Managers, and technical
workshops.


 


From time to
time, the Nominations Committee reviews the effectiveness of the Induction
Program.


 


Continuing
Education


 


The National
is committed to providing its Directors with opportunities to update and
enhance their skills and knowledge. 
Directors are regularly provided with updates from management and
external advisers about key developments in the company and the banking and
fund management industries.


 


Directors are
also entitled to attend external seminars, workshops and other training
programs that are relevant to your directorship.  The National will reimburse you for any
reasonable costs of such additional training.


 


7                                          Access to
information


 


7.1                                Access to
financial records and company books


 


Under the
Corporations Act, a Director has rights of access to the National’s financial
records and, for the purposes of legal proceedings to which the Director is a
party, the National’s books, at all reasonable times.  [Section 198F and section 290
of the Corporations Act]


 


The Deed of
Access, Indemnity and Insurance grants you access to Board papers and related
material.


 


7.2                                Access to
the Company Secretary


 


The Company Secretary
is responsible for providing advice and support to the Board and for ensuring
that Directors have sufficient information to make decisions at meetings of the
Board.  The Company Secretary also
prepares minutes of all Board meetings.


 


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Directors have
direct access to, and are entitled to request additional assistance and
information from, the Company Secretary.


 


7.3                                Authority
to appoint independent professional advisers


 


Directors are entitled to seek independent
professional advice in relation to your duties and powers as a Director of the
National.  The National will reimburse
Directors for all reasonable expenses incurred in obtaining such advice,
provided that the expenses have been approved by the Chairman and, where
appropriate, a copy of the advice is made available to the Board.


 


8                                          Further
guidance and information


 


If you have any queries about your appointment, please
contact me or the Company Secretary.


 


Tricia, my other Board colleagues and I are looking forward to working
with you in the future.


 


 


Yours sincerely


 


	
  /s/ Michael Chaney

  	
   

  



MICHAEL CHANEY

CHAIRMAN


 


I acknowledge that I have read and understood and I
hereby accept the contents of this letter.


 


 


	
  Signed:

  	
  /s/ Patricia A. Cross

  	
   

  
	
   

  
	
  Name: Patricia A Cross

  
	
   

  
	
  Date: 29th
  November 2005

  



 


When you have signed the attached copy of this letter,
please return the signed copy to:


 


Mr Garry Nolan

Company Secretary

National Australia Bank Limited

Level 24

500 Bourke Street

MELBOURNE   VIC   3000


 


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Schedule 1:                                Directors’ Fees as at 1 December 2005:


 


(Fees stated below are inclusive of
Superannuation Guarantee)


 


	
  BOARD/COMMITTEE

  	
   

  	
  CHAIRMAN

  	
   

  	
  MEMBER

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Principal Board & Board Nomination
  Committee

  	
   

  	
   

  	
   

  	
  $

  	
  190,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Principal Board Audit Committee

  	
   

  	
   

  	
   

  	
  $

  	
  25,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Principal Board Risk Committee

  	
   

  	
   

  	
   

  	
  $

  	
  25,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Remuneration Committee

  	
   

  	
   

  	
   

  	
  $

  	
  17,500

  	
   

  



 


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