In a spectacular development, both CEO Andrew Thorburn and chairman Ken Henry will step down from their roles at NAB after the two were subject to a searing rebuke by Royal Commissioner Kenneth Hayne.
The bank entered a trading halt on Thursday afternoon, saying: "Trading in the securities of the entity will be temporarily paused pending a further announcement".
The leadership upheaval comes after NAB suffered a horror year in 2018, with the royal commission exposing the fees for no service scandal, questions over alleged rorts by Mr Thorburn's chief of staff, a bribery ring in the bank's mortgage business and a record-breaking shareholder revolt against the bank's executive pay report.
Despite NAB's board backing Mr Thorburn earlier this week, the CEO said he had been speaking with Dr Henry, and made a decision to resign because of a realisation the bank had "fallen short".
Mr Henry will appear on ABC's 7.30 with Leigh Sales on Thursday night.
Thorburn will finish on 28 February and Henry will leave after a new chief executive has been appointed, with Philip Chronican, an NAB director, to serve as acting CEO from 1 March in the interim.
"I believe the Board should have the opportunity to appoint a new chair for the next period as NAB seeks to reset its culture and ensure all decisions are made on behalf of customers".
Sydney Morning Herald journalist Bevan Shields tweeted: "NAB boss Andrew Thorburn effectively says in a call just now that he was sacked by the board and didn't voluntarily resign".
The opposition leader declared he will not let Scott Morrison "off the hook", signalling Labor will continue to demand additional parliamentary sitting weeks to legislate the recommendations of the royal commission before the election, due in May.
Henry said in a statement: "Andrew and I are deeply sorry about this".
I thought it telling that Mr Thorburn treated all issues of fees for no service as nothing more than carelessness combined with system deficiencies ...
In the teleconference Henry accepted he "could have performed much better in the witness box". In an interview previous year, Baird said he had "no idea what the future holds". "Maybe I did hop out of the bed on the wrong side".
"It has been an honour to be the CEO of NAB, and to have been part of NAB since 2005", Thorburn said.
Thorburn, by contrast, received the backing of the Board earlier this week but has been forced to step down as ongoing investigations into large-scale fraud by his former chief of staff portrayed a culture of extravagant and lavish spending in his executive office.
Peter Brandson, of the campaign group Bank Reform Now, welcomed the resignations but said if banks were serious about accountability they had to provide remediation for customers who had been victims of misconduct.
He referred specifically to a page in the royal commission's final report that said commissioner Hayne was "not as confident as I would wish to be that the lessons of the past have been learned". "They must stop denying, delaying and deceiving". I have always sought to act in the best interests of the bank and customers and I know that I have always acted with integrity.
Henry said he was proud of what the bank had achieved and equally disappointed about what the Royal Commission has brought to light in areas where the bank had not met customer expectations.
Quizzed about his performance at the commission, which was widely criticised as looking defensive and contemptuous, Henry said he was initially surprised by that commentary.
"The timing of my departure will minimise disruption for customers, employees and shareholders", he said.