In a brief statement to the market, the NAB said MacDonald, 51, had decided to retire after a 34-year career with the bank, which included stints in Australia as executive general manager, financial services Australia and in the United Kingdom as head of retail services with the Clydesdale Bank and chief operating officer for the Yorkshire Bank.
The NAB did not disclose MacDonald's exact retirement date.
A spokesperson for the NAB said MacDonald -- one of the institution's longest serving executives -- would continue to work with his immediate boss, NAB chief executive officer and managing director John Stewart and other senior executives on projects until his departure.
MacDonald -- who was appointed in August 2004 -- replaced former Arthur Andersen and Booz Allen Hamilton high-flier Ian Crouch in the role.
News of his retirement comes three weeks after the NAB's Australian executive director and chief executive, Ahmed Fahour, detailed a comprehensive AU$1.8 billion, three year plan to turn around the troubled business. The plan is strongly supported by an information technology revamp driven by Australian CIO Michelle Tredenick.