THE new chairman of National Australia Bank has described Clydesdale Bank as a distraction and said how pleased the group will be to offload the business.

Ken Henry told the Sydney Morning Herald that NAB expects to proceed with a stock exchange flotation of Glasgow-based Clydesdale in February in spite of the recent volatility in global equity markets.

“It will be a considerable relief to everybody on the board and also to management to have the demerger executed," Dr Henry told the newspaper.

"It will be very, very important to get this behind us. The UK story has been quite distracting for both management and the Australian board, and there is no great logic that we can see having banks in the UK run out of Melbourne."

The comments follow a theme rehearsed by Mr Henry’s predecessor Michael Chaney last month shortly before he stepped down.

Mr Chaney told NAB’s general meeting that one of the most “disappointing” parts of his 10-year tenure has been the time the group has taken to exit its Clydesdale and Yorkshire bank businesses in the UK.

National Australia plans to offer 25 per cent of the combined Clydesdale and Yorkshire bank operation's shares to new investors through an initial public offering in early February. The remainder will go to NAB shareholders.

Mr Henry shrugged off recent market volatility noting: "I don't foresee this affecting the transaction. By early February, our aim is – and we fully expect it to happen – for this to be executed.”

He added: “If volatility in equity markets were to become more pronounced, it is open to us to have a smaller IPO, or defer the IPO or whatever, and to let us continue with the demerger. But I fully anticipate that we will have a very successful IPO of the 25 per cent.”

In a trading update Clydesdale Bank said trading in the three months to 31 December had been in line with its board’s expectations.