CEO Presentation 2. CFO Presentation 13. Australia Division 79. New Zealand Division & Geography 87

Transcription

1 Index 1H15 Result Overview CEO Presentation 2 CFO Presentation 13 Treasury 41 Risk Management 52 Group Overview 68 Divisional performance 78 Australia Division 79 New Zealand Division & Geography 87 International and Institutional Banking Division 96 Global Wealth Division 105 Home Loan Case Study 109 All figures within this investor discussion pack are presented on Cash basis in Australian Dollars unless otherwise noted. In arriving at Cash Profit, Statutory Profit has been adjusted to exclude non-core items, further information is set out on page 86 of the 2015 Half Year Consolidated Financial Report. Common growth rate abbreviations used in this presentation include PCP: Prior comparable period growth rate (for instance 1H15 vs 1H14, 2H14 vs 2H13); HoH: Half on Half growth rate (for instance 1H15 vs 2H14, 2H14 vs 1H14) 1

2 Mike Smith Chief Executive Officer

3 Financial performance 1H15 ($m) Growth (1H15-1H14) Statutory Profit ($m) 3,506 3% Cash Profit ($m) 3,676 5% Cash Earnings per Share (cents) % ROE (%) 14.7 (80)bps CET1 (%) Internationally harmonised APRA basis bps Good, well balanced result in the context of a constrained macro environment Our result highlights our strategy is continuing to deliver Strong business performances; some challenges 3

4 Highlights of the result Highlights Australia Retail & Commercial strong, consistent growth Drivers & outcomes Maintained margins in a competitive environment Invested in frontline, digital & NSW Small business lending up 15% 5 yrs above system mortgage growth Best in class productivity Cash Profit & growth PCP 8% 8% 8% $m 1, Aus Div Aus Retail Aus Comm 4

5 Highlights of the result Highlights Australia Retail & Commercial strong, consistent growth New Zealand performance to the next level Drivers & outcomes PBP up 6% in Retail & up 9% in Commercial Winning customers: #1 Mkt position & growing mortgage & cards share Invested in Auckland, Christchurch & small business Continuing strong credit quality Productivity & Efficiency CTI Rev per FTE (RHS) 45.2% NZ$k % 40.1% H13 1H14 1H15 0 5

6 Highlights of the result Highlights Australia Retail & Commercial strong, consistent growth New Zealand performance to the next level Markets customer income at record levels led by Asia growth Drivers & outcomes Past Markets investments delivering diversified regional & product growth 49% of markets income from APEA; driving IIB Asia growth of ~15% 79% markets income customer linked #4 Corporate Bank in Asia 1 $m Markets income 1,228 1,242 22% 21% 78% 79% 1,242 49% 37% 14% APEA Aus NZ 1H14 Balance Sheet 1H15 1H15 Customer linked 1. Greenwich Associates 2014 Asian Large Corporate Banking Study. 6

7 Highlights of the result Highlights Australia Retail & Commercial strong, consistent growth New Zealand performance to the next level Markets customer income at record levels led by Asia growth Investing in digital & other innovation, strengthening NSW Drivers & outcomes Transaction numbers via Digital: 74% in Aus, 65% in NZ Award winning apps GoMoney & Grow by ANZ NSW expansion; opening Myanmar & Thailand Transactive in 17 countries Australia Sales numbers via Digital 1 (%) New Zealand Sales revenue via Digital 2 (%) 9.5% 14.4% 6.6% 7.6% 1H14 1H15 1H14 1H15 1. Sales includes the number of sales events through the Retail distribution network, including all Retail, Commercial and Wealth products. 2. Revenue from sales completed through Digital channels. 7

8 Highlights of the result Highlights Australia Retail & Commercial strong, consistent growth New Zealand performance to the next level Markets customer income at record levels led by Asia growth Drivers & outcomes Strong capital, liquidity & funding positions No material change to CP overlays Strong credit quality: maintaining risk disciplines in competitive markets Investing in digital & other innovation, strengthening NSW Strong risk management $m Provision charge CP IP IP/Avg. NA (RHS) % 0.24% 0.24% 0.21% 0.17% H13 2H13 1H14 2H14 1H15 8

9 Highlights of the result Highlights Australia Retail & Commercial strong, consistent growth New Zealand performance to the next level Markets customer income at record levels led by Asia growth Investing in digital & other innovation, strengthening NSW Drivers & outcomes Integrated Regional Delivery Network Supporting a consistent, higher quality customer experience Improving efficiency - operations costs down 3%, operational volume up 7% Operations efficiency 1 ~50% improvement over 4 ½ years Strong risk management Indexed to FY Enterprise approach FY10 FY11 FY12 FY13 FY14 1H15 1. Operations efficiency measured by operations productivity improvement, which is the difference in operations costs and volume growth. 50% productivity improvement over 4 ½ years. 9

10 Challenges and areas to improve Challenges/Areas to improve Expenses Drivers & outcomes +4% (ex FX) front running investment Targeting ~3% FY15 Global liquidity squeezing loan margins, deferring benefit of Institutional cash build out Building deposits faster Lifting cross-sell & key corridors growth Managing returns, more balanced bank Trade pressured by commodity prices and lower hedge revenue Strong core business experiencing cyclical pressure Returns up despite tough conditions Progress on structural realignment of the business Esanda Dealer Finance sale RWA growth 7%, ~50% FX driven Disciplined capital management 10

11 SUPER REGIONAL STRATEGY STRONG CORE MARKETS PROFITABLE ASIAN GROWTH ENTERPRISE APPROACH STRONG LIQUIDITY AND CAPITAL MANAGEMENT DISCIPLINED AND EXPERIENCED MANAGEMENT CEO PRIORITIES FY14-16 Improving customer experience Diversifying revenue Improving productivity Improving returns 11

12 Summary Good, well balanced result Very positive about Australia despite challenging global environment Investing in Australia s future: helping customers, creating jobs, supporting small business Strategy has delivered good progress to date for shareholders confident we can balance short and long term growth, investments and return We will deliver our CTI commitment We remain committed to ROE discipline 12

13 Shayne Elliott Chief Financial Officer

14 Summary of results 1H15 1H14 $m change Revenue 10, % Expenses (4,593) 7.2% PBP 5, % Provisions (510) (3.4%) Cash Profit 3, % Stat. adjustments (170) Statutory Profit 3, % Cash EPS (cents) % DPS (cents) % ROE 14.7% (80)bp 14

15 Impact of FX translation 1H15 Growth FX impact FX Adj Growth Revenue 5.3% 2.1% 3.2% Expenses 7.2% 2.8% 4.4% PBP 3.9% 1.7% 2.2% Other 1 CNY USD NZD 1H15 Earnings Composition (by currency) 1H15 $3,676m 1H13 $3,179m 11% 10% 5% 3% 6% 4% 18% 22% Provisions (3.4)% 1.6% (5.0)% NPAT 4.6% 1.8% 2.8% AUD 56% 65% ROE (80)bp (30)bp (50)bp 1. major currencies in other category includes TWD, MYR, PGK and IND no one currency greater than 2% 15

16 Operating environment and key actions What we said at FY14 Actions 1H15 Expanded coverage Additional Aus. Division front office staff: ~600 NSW expansion Improved Customer Experience Digital capacity & capability GoMoney, Grow, Smart Choice & Transactive enhancements Tap and Pin ATM: world first Rolled out Transactive China and Philippines Single digital access to Cash, Trade and Markets in 4 Asian markets Enhanced Productivity & Capital Efficiency Hubs & Ops unit costs down ~10% average Esanda Dealer Finance sale 16

17 DRIVERS OF GROUP EARNINGS 17

18 Revenue drivers A$m , , ,870 (59) (41) 14 (7)% (3)% 2% 6% 4% 13% 3.2% 5.3% 1H14 FX translation 1H14 FX Adj. Global Loans Global Markets TB Retail Comm. P'Ships/ Other 1H15 Notes. TB: Transaction Banking, Retail: Retail Australia, Retail New Zealand, Retail Asia Pacific and Global Wealth, Comm: Corporate & commercial Banking Australia and Commercial NZ 18

19 NIM drivers bps 212 (3.0) 209 (2.0) (2.0) (1.0) (3.0) 204 (1.0)bps (8.0)bps 2H14 FX 2H14 FX Adj. Business Asset Pricing Retail Asset Pricing Deposits 1H15 Pre one-off Impacts Aus. Retail Remediation Markets & Treasury 1H15 19

20 Expense drivers A$m 113 4, , ,593 4, % 4.4% 1H14 FX Translation 1H15 FX Adj. BAU D&A 1H15 pre Invest. Discretionary investment 1H15 20

21 Portfolio credit quality remains sound Collective provision balance by source A$m , (7) 2,757 $m 1, Total Provision Charge H13 2H13 1H14 2H14 1H15 CP charge IP charge Predominantly Australia Division - consumer cards & mortgages 1.9% ex FX Sep 14 Fx Risk Mgt Credit overlay Growth Mix Mar 15 Gross Impaired Assets $m 5,000 4,685 4,264 4,000 3,620 2,889 3,000 2,708 2,000 1,000 0 Mar 13 Sep 13 Mar 14 Sep 14 Mar 15 < $10m $10-$100m > $100m 21

22 DIVISIONAL PERFORMANCE 22

23 Divisional contribution to profit growth Divisional Cash Profit (1H15 1H14) A$m (90) 3,676 3, % 6.7% 2.9% 10.7% 4.6% 1H14 Australia IIB NZ Wealth GTSO & Group 1H15 23

24 Australia consistent growth & return, plus accelerated investment Retail lending growth Commercial lending growth 1.95% 1.97% 1.97% 2.01% $b % 229 $b 87% 87% 87% 88% 88% Mar 13 Sep 13 Mar 14 Sep 14 Mar 15 NLAs NIM (%) Improving productivity Mar 13 Sep 13 Mar 14 Sep 14 Mar 15 NLAs Strong operating performance 1 EAD by CCR (6 or stronger) % $ 000 1H15 profit growth (PCP) % 5.2% 6.5% 300 1H13 2H13 1H14 2H14 1H15 CTI (%) Revenue per FTE (RHS) 1. CCR = Customer Credit Rating 250 Revenue Expenses PBP 24

25 Australia - Retail a highlight Customers Total Retail customer numbers 106 Indexed Mar 13 Mar 15 FUM Home Loans FUM 120 Indexed Mar-13 Mar-15 Cards and Payments FUM 110 Indexed Mar-13 Mar-15 Retail Deposits FUM 115 Indexed Mar-13 Mar-15 FUM FUM/Customer Retail products per customer 1 retail product % of total customers 43.4% 41.6% Mar 13 Mar retail products % of total customers 49.0% 47.6% Mar 13 Mar retail products % of total customers 9.4% 9.0% Mar 13 Mar 15 25

26 New Zealand Division scale benefit driving growth Retail lending growth NZ$b 2.72% 2.61% 2.62% 2.65% 2.52% Commercial lending growth NZ$b 88% 91% 92% 93% 96% Mar 13 Sep 13 Mar 14 Sep 14 Mar 15 NLAs NIM Improved productivity % NZ$k H13 2H13 1H14 2H14 1H15 CTI Revenue per FTE (RHS) Mar 13 Sep 13 Mar 14 Sep 14 Mar 15 NLAs 1 EAD by CCR (6 or stronger) Operating performance 1H15 PCP growth (NZ$) 7.8% 5.6% 2.5% Revenue Expenses PBP 1. CCR = Customer Credit Rating 26

27 Global Wealth focused on quality & growth Wealth customers 1 Retail Life lapse rates FUM net flows 2 m % 2.1 Australia 13.3% 12.1% 11.6% $m (442) Sep-13 Mar 14 Mar 15 1H13 1H14 1H15 1H13 1H14 1H15 Improved productivity 3 Operating performance 3 % CTI H15 PCP growth 14.6% % 1.9% 1H13 1H14 1H15 Revenue Expenses PBP 1. ANZ Wealth customers directed through ANZ channels 2. Global Private Wealth and Funds Management netflows 3. Excluding the impact of the Trustees sale 27

28 14. 0% 12. 0% 10. 0% 8.0% 6.0% 4.0% 2.0% 0.0% Digital investment delivering results Australia ANZ Smart Choice Sales numbers via Digital 1 (%) 9.5% 14.4% Transaction numbers via Digital 2 (%) 70.4% 73.9% Online rollover innovation released 775 1, ,404 4,000 3,500 3,000 2,500 2,000 1,500 1, H14 1H15 1H14 1H15 Mar 13 Mar 14 Mar 15 FUM ($m) Ave Weekly Rollovers New Zealand Transactive Mobile Sales revenue via Digital 3 (%) 6.6% 7.6% 1H14 1H15 Transaction numbers via Digital 2 (%) 59.1% 1H % 1H15 A$b $0 $20 $37 $55 FY12 FY13 FY14 FY15x Value Volume (RHS) 4 k 7,000 6,000 5,000 4,000 3,000 2,000 1, Sales includes the number of sales events through the Retail distribution network, including all Retail, Commercial and Wealth products. 2. Transactions refers to the number of value transactions through all channels including internet, mobile, teller and ATM. 3. Revenue from sales completed through Digital channels. 4. Determined by annualised calculation of available data as at Feb

29 IIB revenue re-balancing A$m 3,786 3,622 Loan margins FVA Commodity prices Interest Rates Regulatory changes Customer Acq. & penetration Asia Growth Cash volumes Trade volumes Market Sales FX 4.5% 1H14 Macro Headwinds Diversification & growth 1H15 29

30 IIB improving the mix IIB 1H15 profit by region IIB 1H15 Revenue Growth A$m, % growth PCP (4)% 20% 167% (33)% A$ % growth PCP 24% 14% 10% 1% % -4% Aus / NZ Asia EMEA Pacific P ships Retail Cash Markets Trade Loans IIB Asia Productivity IIB Asia Profitable growth 61% 55% 54% US$k US$m 1.23% 0.46% 1.51% 0.77% % 0.81% H13 CTI 1H14 1H15 Rev/FTE (RHS) 100 NPAT 1H13 1H14 RoRWA IIB 1 1H15 RoRWA IIB ex Pship 1 1. RoRWA equals Net Profit After Tax divided by average Basel III risk weighted assets. 30

31 Markets income by type A$m Sales Trading ex Balance Sheet Balance Sheet Valuation Adjustments for Derivatives H13 1H14 1H15 1H13 1H14 1H15 1H13 1H14 1H15 1H13 1H14 1H15 31

32 BALANCE SHEET STRENGTH 32

33 Risk Weighted Assets Total RWA $b $b CRWA growth Other Lending growth 15.4 FX H15 change HoH Risk +4.7% (FX adjusted) Sep 13 Mar 14 Sep 14 Mar 15 Credit RWAs Market & Operational RWAs 1.Credit Risk Growth = EAD growth, includes portfolio mix and risk improvement 2.Credit Risk Other = Initiatives, Model changes, Regulator changes, FX 33

34 Liquidity successfully transitioned to LCR September 2014 March 2015 $b $b 17 LCR 111% Surplus $15b LCR 119% Surplus $28b Liquid Assets 1 3 1, 2 3 Net Cash Outflows Liquid Assets Net Cash Outflows HQLA 1 HQLA 2 Internal RMBS Other Alternative Liquid Assets Customer deposits and other 4 Wholesale funding 1. Post haircut market value as defined in APS H15 includes $54bn Committed Liquidity Facility. 3. Basel III LCR 30 day stress scenario cash outflows. 4. Other include off-balance sheet and cash inflows. 34

35 Strong capital levels domestically and internationally % (0.22) (0.21) (0.64) (0.02) (7)bps 40bps Mar 14 Sep 14 Cash NPAT RWA Usage 1 2 Capital Dividends Other Mar 15 Mar 14 Mar 15 3 Deduct Internationally 4 Comparable 1. Cash profit net of preference share dividends. 2. Includes EL vs. EP shortfall. 3. Represents the movement in retained earnings in deconsolidated entities, capitalised software and other intangibles. 4. Methodology per Australian Bankers Association: International comparability of capital ratios of Australia s major banks (August 2014) 35

36 Outlook and focus Responsible investment in Australia Retail & Commercial Quality expansion in Asia based around Trade & Capital corridors Group wide productivity Further steps on portfolio rebalancing & Capital Efficiency 36

37 CFO Appendix

38 Provision charge drivers Credit Impairment Charge contribution $m 528 Australia Division IIB NZ Division (34) 2 (102) 510 (3.6)% Mar 14 Retail Comm. Markets & Loans TB Retail Comm. Mar 15 TB: Transaction Banking 38

39 Enterprise approach continuing momentum Operations volume growth 1H15-1H14 9% 9% Continued improvement in quality Manual Payments: Defects Per Million 6% 7% 7% % Australia IIB NZ Wealth Total 1H12 2H12 1H13 2H13 1H14 2H14 1H15 Operations costs growth 1H15-1H14 Better customer experience AUD growth 2% Australian customer complaints. 1H12 index = % -4% -2% -5% -3% Australia IIB NZ Wealth Total 1H12 2H12 1H13 2H13 1H14 2H14 1H15 39

40 New Zealand highlights Key drivers Increasing sales capacity Simplifying products and processes Delivering leading digital solutions Strengthening market leadership % Home Loans 1 Credit Cards Expanding customer awareness Mar 13 Mar 14 Mar 15 Mar 13 Mar 14 Mar 15 Improving revenue per branch 2 Growing customer numbers NZ$m Gross Retail customer acquisition Gross Small Business Banking customer acquisition 2 59k 67k 82k 2.6k 3.4k 3.5k 1H13 1H14 1H15 1H13 1H14 1H15 1H13 1H14 1H15 All values in New Zealand Dollars. 1. Source: RBNZ - Mar 2015, relates to NZ Geography. 2. based on NZ Division. 40

41 Treasury

42 Regulatory capital Treasury Capital Update 1H15 organic capital generation 1 of 59 bps modestly above recent first half performance. APRA Common Equity Tier 1 ratio 8.7%. Target range for CET1 ratio remains around 9% on an APRA basis. Internationally Comparable 2 CET1 ratio is ~3.7% higher than under APRA basis. Reflects variances between Basel III under APRA and Basel standards. 1.5% discount for 1H15 Dividend Reinvestment Plan aims to achieve ~20% participation on a full 12 month basis. This level of participation is consistent with average observed since 2012 and capital planning. Basel 3 Common Equity Tier 1 (CET1) 12.2% 12.7% 12.4% 8.3% 8.8% 8.7% Mar 14 Sep 14 Mar 15 APRA Internationally Comparable 2 APRA CET1 movement - Mar 15 v Sep 14 Total RWA movement - Mar 15 v Sep 14 % 1.02 (0.22) 8.79 (0.21) 8.72 (0.64) (0.02) $b (0.7) (6.9) Credit RWA +$30.8bn Sep 14 Cash RWA NPAT 3 Usage 4 Capital Net 5 Deductions Dividend Other Mar 15 Sep 14 Growth FX Impact Other 6 Market & IRRBB RWA 1. Organic capital generation = cash profit - RWA growth - capital deductions. 2. Methodology per Australian Bankers Association: International comparability of capital ratios of Australia s major banks (August 2014). March 2014 comparatives has been restated based on current methodology. 3. Cash profit net of preference share dividends. 4. Includes EL vs. EP shortfall. 5. Represents the movement in retained earnings in deconsolidated entities, capitalised software and other intangibles. 6. Other includes risk and portfolio data review impact. Op Risk RWA Mar 15 42

43 Internationally Comparable regulatory capital position Treasury CET1 Tier 1 Total Capital APRA 8.7% 10.6% 12.6% 10% / 15% allowance for equity investments and DTA Mortgage 20% LGD floor IRRBB RWA (APRA Pillar 1 approach) Specialised Lending (Advanced treatment) Corporate undrawn EAD and unsecured LGD adjustments Other APRA requires 100% deduction from CET1 vs. Basel framework which allows concessional threshold prior to deduction APRA requires use of 20% mortgage LGD floor vs. 10% under Basel framework APRA includes in Pillar 1 RWA. This is not required under the Basel framework APRA requires supervisory slotting approach which results in more conservative risk weights than under Basel framework Australian ADI unsecured corporate lending LGDs and undrawn CCFs exceed those applied in many jurisdictions Includes impact of deductions from CET1 for capitalised expenses and deferred fee income required by APRA 0.9% 0.9% 0.8% 0.4% 0.4% 0.5% 0.2% 0.2% 0.3% 0.4% 0.4% 0.5% 1.5% 1.8% 2.0% 0.3% 0.4% 0.4% Internationally Comparable % 14.7% 17.1% 1. Internationally Comparable methodology per Australian Bankers Association: International comparability of capital ratios of Australia s major banks (August 2014). 43

44 ANZ (APRA) ANZ (Internationally Comparable) ANZ (Canada basis) Canada Peer 2 Average ANZ (UK basis) UK Peer Average ANZ (Singapore basis) 1 Singapore Peer 2 Average ANZ (Europe basis) Europe Peer 2 Average 2 ANZ s CET1 ratio compares favourably to global peers adjusting for regional methodology differences Treasury Canada UK Singapore Europe +270bps +60bps +70bps +30bps 8.7% 12.4% 12.5% 9.8% 11.5% 10.9% 12.1% 11.4% 11.9% 11.6% 1. Methodology per Australian Bankers Association: International comparability of capital ratios of Australia s major banks (August 2014). 2. Peer estimates are based on RWA weighted average of G-SIB/D-SIBs (ex Singapore which is based on DBS and OCBC) fully loaded Basel III capital ratios per most recent disclosures. 44

45 Sep-12 Dec-12 Mar-13 Jun-13 Sep-13 Dec-13 Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Common Equity Tier 1 ratio, dividend timing and regulatory capital generation Treasury APRA Basel III CET1 Ratio Common Equity Tier 1 generation (bps) 9.0% 8.5% First half average 1H12 1H14 1H15 8.0% 7.5% 7.0% Cash profit RWA growth (29) (22) Capital deductions (18) (21) Net capital generation Gross dividend (70) (72) Note: shaded quarters represent declaration of dividends. Basel III basis. Under Basel III, dividends are only deducted from regulatory capital in the quarter in which they are declared. This results in volatility in quarterly reported capital ratios. To assess the underlying regulatory capital position, dividend payments should be adjusted to accrue evenly over the year, aligned with profit generation. Dividend Reinvestment Plan Core change in CET1 capital ratio Other non-core and nonrecurring items Net change in CET1 capital ratio 14 8 (1) (5) 11 (2) 10 (7) 45

46 Stable balance sheet composition March 2015 Treasury $738bn $738bn Short Term Liquids 17% Other Short Term Assets & Trade 12% 29% +3% Other ST Liabilities 4% ST Funding 8% Term Funding <12M 4% Other Customer Deposits 14% 30% +3% Structural funding position has remained stable with growth in short-term funding invested in liquids and other short-term assets Lending 69% 71% -3% Stable Customer 1 Deposits 50% 70% -3% Customer Deposits +$34bn or +8% vs. Sep 14 Long Term Fixed Assets & Other 2% Term Funding >12M 12% SHE & Hybrids 8% Assets Funding Note: represents the change in % of funded balance sheet from 30 September 2014 to 31 March Stable customer deposits represent operational type deposits or those sources from retail / business / corporate customers and the stable component of Other funding liabilities. 46

47 Term wholesale funding portfolio Treasury Term Funding Profile 24 Issuance $bn 23 Maturities 21 Annual indicative issuance volume FY10 FY11 FY12 FY13 FY14 1H15 2H15 FY16 FY17 FY18 FY19 FY20 FY21+ Senior Unsecured Covered Bonds Tier 2 Portfolio by Type Portfolio by Currency 9% 6% 8% 9% 9% 8% 18% 20% 13% 18% 69% 68% 74% 71% Sep 12 Sep 13 Sep 14 Mar 15 Government Guaranteed Tier 2 Covered Bonds Senior Unsecured 24% 6% 1% 35% 34% Domestic (AUD,NZD) North America (USD, CAD) UK & Europe (,,CHF) Asia (JPY, HKD, SGD, CNY) Other All figures based on historical FX and excludes hybrids. 1. Includes transactions with a call or maturity date greater than 12 months as at 30 September in the respective year of issuance. 47

48 Liquidity management successfully transitioned to LCR Treasury Date Sep 14 Mar 15 LCR 111% 119% LCR Surplus $15bn $28bn $b Liquid Assets Net Cash Outflows Liquid Assets Net Cash Outflows 1 3 1, 2 3 HQLA 1 HQLA 2 Internal RMBS Other Alternative Liquid Assets Customer deposits and other 4 Wholesale funding 1. Post haircut market value as defined in APS H15 includes $54bn Committed Liquidity Facility. 3. Basel III LCR 30 day stress scenario cash outflows. 4. Other include off-balance sheet and cash inflows. 48

49 Foreign currency hedging Treasury 1H15 Earnings Composition (by currency) Net FX Impact (EPS) 1.7% 1.6% IDR Other 22% AUD 56% NZD 22% 1H15 v 1H14 1H15 v 2H14 Translation Rates (inclusive of hedges) The key objective of hedging is to manage short term EPS volatility arising from foreign currency earnings Hedges currently in place: FY15: ~80% of remaining earnings. FY16: ~70% of NZD and ~ 25% of USD (inc. currencies that are highly correlated to AUD/USD) earnings. Hedging has reduced the impact of a 5% movement of the AUD on FY15 EPS to less than 1% H13 2H13 1H14 2H14 1H NZD Translation (LHS) USD Translation (RHS) 49

50 FX sensitivity (excluding the impact of revenue hedges) Treasury Metric Income statement Approx. annualised impact of 5% fall in AUD 1 Comments Revenue 2% Impact of translation of non-aud revenue Operating expenses 2% Impact of translation of non-aud expenses Cash profit 2% Net interest margin Cost to income ratio Balance sheet Collective provision coverage Funding (1 bp) +2 bps (0.5 bp) +$4 bn Net result of revenue and expense FX effects, excluding the impact of foreign currency hedges. Mix impact due to a higher relative contribution from lower risk and lower margin APEA assets FX effect on revenue and expenses largely offset each other, however average cost to income ratios in non-aud denominated businesses are marginally higher CP overlays booked in AUD vs. a proportion of CRWA denominated in foreign currencies Further impact from higher CRWA on FX derivatives with no corresponding CP as derivatives are marked-to-market and attract CVA Collateral flows under cross currency swaps used to hedge existing offshore funding liabilities Return on equity +3 bps Driven by positive FX effect on cash profit (see above) partially offset by increase in FCTR Minimal impact on CET1 ratio 1. Impact from a lower AUD relative to foreign currencies. Analysis based on 1H15 results (excluding the impact of foreign currency revenue hedges). 50

51 Regulatory landscape Treasury Status ANZ s position Leverage ratio APRA draft standard Sep 2014 No minimum currently specified, BCBS 3% Leverage ratio % at 1H15 depending on final calibration Level 3 capital adequacy Conglomerates APRA draft Level 3 standards Aug 2014 Finalisation and implementation deferred until Financial System Inquiry recommendations considered by government/apra No material impact expected based on current draft standards Capital Basel Standardised and floors BCBS consultation papers released Dec 2014 propose changes to Standardised risk weights, introduction of Advanced approach capital floors ANZ has participated in BCBS QIS. Impact of any changes subject to final BCBS calibration and APRA implementation. Total Loss Absorbing Capacity (TLAC) Financial Stability Board proposal released Nov 2014 details minimum TLAC requirements for G-SIBs Proposal currently does not apply to D-SIBs. If applied to ANZ, wide range of outcomes depending on calibration including basis for measuring capital base, D-SIB minimum etc Liquidity Coverage Ratio Full implementation from Jan 2015 Disclosure timetable to be determined by APRA Full compliance at 1H15 (LCR 119%) Funding Net Stable Funding Ratio BCBS standard Jan 2014 APRA standard yet to be finalised, expected implementation 2018 Do not expect NSFR to require any material change to balance sheet composition Other Financial System Inquiry Key recommendations to government: Set standards such that Australian ADI capital ratios are unquestionably strong Raise Advanced IRB mortgage risk weights to narrow difference with Standardised approach Implement loss absorption and recapitalisation framework in-line with international practice Introduce Basel framework leverage ratio Final round consultation closed 31 March 2015 Refer to ANZ s submission on the Final Report of the Financial System Inquiry published 1 April

52 Risk Management

53 Provision Charge Risk Management $m % Provision charge % 0.24% % % 1H13 2H13 1H14 2H14 1H15 Individual Provision (IP) Charge Collective Provision (CP) Charge IP Charge as % Avg. Net Advances (RHS) Individual provision charge composition $m 1,500 1, , H13 2H13 1H14 2H14 1H15 New Increased Writebacks & Recoveries Individual provision charge by segment $m H13 2H13 1H14 2H14 1H15 Institutional Commercial Consumer Individual provision charge by region $m H13 2H13 1H14 2H14 1H15 Australia New Zealand APEA 53

54 Historical Loss Risk Management Group regulatory expected loss Historical observed loss rates bps EAD bps IP Loss Rate (LHS) median bp loss rates (LHS) Corporate Gearing lagged 15 months (RHS) % Mar 11 Mar 12 Mar 13 Mar 14 Mar Sep 90 Sep 94 Sep 98 Sep 02 Sep 06 Sep 10 Sep 14 Corporate gearing remains low Corporate gearing ratios 1 were compared with the Group IP loss rates from Lagging corporate gearing 15 months provides a reasonably strong relationship, with corporate gearing a leading indicator of loss Current IP loss rate (annualised) as at Mar 15 was 17bps which is similar to that observed between 2005 and 2007 The annualised 1H15 IP loss rate (17 bps) is the 6th lowest rate over the time period analysed since Debt to equity ratios for listed Australian Corporations sourced from the RBA. 54

55 Impaired Assets Risk Management Index Sep 09 = Control list $m 2,000 1,500 New impaired assets by division 1,716 1,571 1,541 1,327 1, , Sep 09 Sep 10 Sep 11 Sep 12 Sep 13 Sep 14 Control List by Limits Control List by No of Groups Gross impaired assets by size of exposure $m 5,000 4,685 4,264 4,000 3, H13 2H13 1H14 2H14 1H15 Australia New Zealand IIB Other Impaired assets concentration by number of customers 1 3% 3% 3% 3% 5% 11% 9% 8% 8% 16% 5% 11% 3,000 2,889 2,708 2,000 83% 88% 84% 76% 84% 1,000 0 Mar 13 Sep 13 Mar 14 Sep 14 Mar 15 < $10m $10-$100m > $100m Mar 13 Sep 13 Mar 14 Sep 14 Mar 15 $10-50m $51-100m $ m >$200m 1. Only >$10m customers. 55

56 Collective Provision Risk Management CP Balance Growth CP coverage The collective provision balance increased by $157m in the first half of FY15, to $2,914m, predominantly driven by: $b Foreign exchange, particularly the depreciation of the AUD against the USD and against the NZD, which accounted for $102m, or 65%, of this increase 1.01% 1.00% 0.93% 0.89% 0.86% Portfolio growth of $54m, specifically the Australia Division (67%), driven by the retail portfolios Collective provision by division Mar 13 Sep 13 Mar 14 Sep 14 Mar 15 Credit Risk Weighted Assets Collective Provision as a % of CRWA (RHS) Collective provision by source $m $m 102 2, , ,757 (2) (3) (1 ) 2,757 5 (7 ) Sep 14 AUS IIB NZ Wealth & Other FX Movement Mar 15 Sep 14 Risk Lending Growth Portfolio Mix Mgmt. Overlay Fx movement Mar 15 56

57 Risk Weighted Assets Risk Management Total risk weighted assets Group EAD & CRWAs $b Op-Risk Risk Weighted Assets Market & IRRBB Risk Weighted Assets $b Credit Risk Weighted Assets 39.8% 38.9% 39.2% 38.0% 38.1% Mar 13 Sep 13 Mar 14 Sep 14 Mar 15 Exposure at Default CRWA / EAD (RHS) CRWA movement - Mar 15 v Sep 14 $b (2.4) Sep 13 Mar 14 Sep 14 Mar 15 Sep 14 Risk Lending Growth Portfolio Data Review FX Impact Mar 15 57

58 Portfolio composition Risk Management Exposure at default (EAD) as a % of Group total ANZ Group Category % of Group EAD % of Portfolio Portfolio Balance in Non in Non Performing Performing Mar 14 Mar 15 Mar 14 Mar 15 Mar 15 Total Group EAD (Mar 15) Consumer Lending 40.3% 38.2% 0.2% 0.2% $608m $869b 1 Finance, Investment & Insurance 16.4% 18.7% 0.1% 0.1% $93m 2% 2% 2% 6% 2% 2% 3% 4% 4% 4% 38% Property Services 7.0% 6.8% 1.7% 1.3% $757m Manufacturing 6.1% 6.5% 0.6% 0.5% $297m Agriculture, Forestry, Fishing 4.2% 3.9% 3.5% 2.1% $728m Government & Official Institutions 3.8% 4.4% 0.0% 0.0% $0m Wholesale trade 3.9% 4.0% 0.6% 0.4% $154m Retail Trade 2.7% 2.6% 0.6% 0.4% $101m 6% 7% 19% Transport & Storage 2.4% 2.2% 3.0% 1.3% $257m Business Services 1.9% 1.8% 1.3% 0.9% $151m Resources (Mining) 2.3% 2.2% 0.7% 0.5% $97m Electricity, Gas & Water Supply 1.7% 1.6% 0.1% 0.1% $10m Construction 1.6% 1.6% 1.9% 1.7% $240m Other 5.7% 5.5% 0.6% 0.5% $220m 1. EAD excludes amounts for Securitisation and Other Assets Basel asset classes. 58

59 Risk Weighted Assets and Value at Risk Risk Management Risk weighted asset and VaR outcomes Traded Market Risk VaR usage remained moderate to low Traded Market Risk 1-day 99% VaR and RWA declined YoY through disciplined approach to managing our exposures to market disruption and stress RWA for Interest Rate Risk in Banking Book (IRRBB) declined YoY primarily due to higher embedded market value, reduced credit spread volatility and shortening the duration of the Investment Term of Capital Traded market risk weighted asset trends $b $m $b IRRBB risk weighted asset trends Mar 10 Mar 11 Mar 12 Mar 13 Mar 14 Mar 15 Market Risk RWA Traded Market Risk RWAs Traded VaR Traded Market Risk 1-day VaR (RHS) 0 Mar 10 Mar 11 Mar 12 Mar 13 Mar 14 Mar 15 IRRBB RWA 59

60 Resources Portfolio Risk Management Resources exposure by sector (% EAD) Total EAD (Mar 15) As a % of Group EAD $19.5b 2.2% Resources exposure credit quality by geography (EAD) AUS ($b) NZ ($b) ASIA ($b) EA & Other ($b) Oil & Gas 23% Metal Ore Mining 23% (includes 14% Coal Iron Mining Ore 10%) 16% 15% Services To Mining 16% 6% Other Mining 6% 1H15 1H14 42% 39% 49% 51% 24% 22% 76% 78% Resources portfolio management 9% 91% AUS NZ ASIA OTHER Investment Grade Sub-Investment Grade Portfolio is skewed towards well capitalised and lower cost resource producers. Over a third of the book is less than one year duration. Investment grade exposures represent 67% of portfolio. Mix of investment grade exposures in portfolio has increased across all geographies in 1H15. Trade accounts for 21% of the Total Resources EAD. Mining services customers are subject to heightened oversight given the cautious outlook for services sector. 60

61 Agri portfolio Risk Management Agriculture exposure by sector (% EAD) Total EAD (Mar 15) As a % of Group EAD $34.0b 3.9% Dairy 14% Beef 10% Sheep & Other Livestock 40% Grain/Wheat 16% New Zealand Agri credit quality NZ$ b % % 1.23% 0.94% 0.81% % Horticulture/Fruit/Other Crops Forestry & Fishing/Agriculture Services 9% 11% Sep 10 Sep 11 Sep 12 Sep 13 Sep 14 Mar 15 NZD Total Credit Exposure 1 Average PD (Non-Defaulted Customers) (RHS) Group Agriculture EAD splits 1% 2% 7% 5% 38% 17% 61% 98% 71% Australia New Zealand Int Markets Productive 1. PD model changes account for 11bps increase in 1H15. Impaired <60% Secured 60 - < 80% Secured 80 - < 100% Secured Fully Secured 61

62 Commercial property portfolio Risk Management $b Commercial Property outstandings by region % 7.5% 7.0% 6.5% Commercial Property outstandings by sector 1 30% 4% 3% 26% 15% 22% Offices Retail Residential Industrial Tourism Other Property peer comparison % 5.5% $m ANZ Peer 1 Peer 2 Peer 3 Property Portfolio EAD 51,039 68,739 72,935 57,994 Property EAD Growth Rates 7.9% (1.6%) 13.9% 7.0% 5.0% Mar 13 Sep 13 Mar 14 Sep 14 Dec 14 APEA New Zealand Australia % of Group GLA's (RHS) Property EAD/Total EAD 5.73% 7.57% 8.50% 6.42% Impaired Assets 424 1, Property Impaired Assets/Property EAD 0.83% 2.18% 1.00% 0.55% 1. As per ARF230 disclosure. 2. As per APS330 disclosure. ANZ includes property services, not consistent across peers. 62

63 Industry Themes and Guidelines for Quality Risk Management Areas on Watch 1. Commercial Property Land and buildings primarily leased to third parties or new buildings constructed to be leased or sold to third parties. 2. Residential Property Residential Land and/or buildings Variable or fixed rate Owner occupied, investor, equity loan Interest only or Principal & Interest 3. Resources Sector Industry sectors include: Metal Ore (Including Iron Ore) Mining and Mining Services Mining infrastructure Oil and Gas Coal ANZ Lending Principles Examples 1.1 Focus on key markets in Australia, New Zealand, Singapore and Hong Kong 1.2 No appetite for speculative development 1.3 Limited appetite to lend against third party leased specialised buildings 2.1 Triggers and controls guide growth in investment, interest only and high LVR-band lending 2.2 Very limited appetite for Self Managed Super Fund lending 2.3 No appetite for reverse home loans or subprime loans 3.1 Relationships focused on low cost producers 3.2 We are focused on intermediating trade and FX flows 3.3 Mining infrastructure cost sustainability monitored 3.4 Preference for equipment leasing over unsecured lending 63

64 Australia Division Risk Management Australia Division credit exposure (EAD) Australia Home Loans 90+ day delinquencies by state 1 Home Loans Corporate and Commercial Consumer Cards 1% 0% 6% 24% 1.0% 0.8% 0.6% 0.4% Mar 12 Mar 13 Mar 14 Mar 15 Personal Loans 69% 0.2% Other 0.0% VIC NSW & ACT QLD WA Portfolio Australia Division 90+ day delinquencies 1 Australia Home Loans portfolio by state 1 2% Home Loans (inclusive of hardship change) Corporate & Commercial Banking Consumer Cards 3 2 Mar % 27.0% 17.7% 16.2% 9.7% 1% 1.08% 1.04% 0.57% Mar % 26.2% 18.2% 16.5% 9.8% 0% Oct 10 Oct 11 Oct 12 Oct 13 Oct 14 0% 25% 50% 75% 100% VIC NSW & ACT QLD WA Other 1. Exclusive of Non Performing Loans. 2. Hardship changes implemented Apr For comparison: 90+ excluding hardship changes as at Mar 2015 is 0.46%. 3. Includes Small Business, Commercial Cards and Esanda Retail. 64

65 Australia Home Loans portfolio Risk Management 1H15 portfolio statistics 1 Dynamic loan to value ratio 5 Total Number of Home Loan Accounts 934k Total Home Loans FUM $218b % of Total Australia Geography Lending 60% % of Total Group Lending 39% Owner Occupied Loans - % of Portfolio 2 60% Average Loan Size at Origination $376k (1H15 average) 3,4 Average LVR at Origination (1H15) 3,4,5 71% Average Dynamic LVR of Portfolio 4,5,6 51% % of Portfolio Ahead on Repayments 7,8 43% % of Portfolio Paying Interest Only 8 35% % of Portfolio 50% 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% Sep 12 Mar 13 Sep 13 Mar 14 Sep 14 Mar 15 LVR >90% 4.08% (Mar 15) % 61-75% 76-80% 81-90% 91-95% 95%+ Individual provision as % of average NLA FY12 FY13 FY14 1H15 Group 0.38% 0.25% 0.22% 0.17% Australia Home Loans 0.02% 0.02% 0.01% 0.01% 1. Home Loans (inclusive of NPLs, exclusive of offset balances). 2. Excludes Equity Manager. 3. Originated 1H Unweighted. 5. Including capitalised premiums. 6. Valuations updated Mar 2015 where available. 7. % of customers >30 days ahead of repayments. 8. Excludes revolving credit. 9. Excluding capitalised premiums, the % of portfolio with LVR >90% as at Sep 2014 is 2.35% (Mar 2015 was 2.6%) 65

66 New Zealand Risk Management NZ Geography net impaired assets NZDm Net Impaired Assets 1,685 NIA as % GLA (RHS) 1,307 1, % 1.38% 1.23% % 0.89% 483 NZ Geography total provision charge NZDm (39) H11 2H11 1H12 2H12 1H13 2H13 1H14 2H14 1H15 IP Charge CP Charge NZ Division 90+ days delinquencies 1.5% 1.0% 0.66% 0.58% 0.46% % 0.5% 0.0% Sep 07 Sep 09 Sep 11 Sep 13 Mar 11 Sep 11 Mar 12 Sep 12 Mar 13 Sep 13 Mar 14 Sep 14 Mar 15 Home Loans Commercial Agri 66

67 New Zealand mortgages portfolio Risk Management 1H15 portfolio statistics Dynamic loan to valuation ratio Total Number of Mortgage Accounts 494k Total Mortgage FUM (NZD) $64b 0-60% 8% 6% % of Total New Zealand Lending 59% % of Total Group Lending 1 11% 61-70% 71-80% 81-90% 19% 49% Owner Occupied Loans - % of Portfolio 75% 90%+ 18% Average Loan Size at Origination (NZD) $289k Average LVR at Origination 2 64% Average Dynamic LVR of Portfolio 3 49% % of Portfolio Paying Interest Only 4 22% Individual provision as % of average NLA Mortgage portfolio by region Auckland 3% Wellington 12% Christchurch 41% FY12 FY13 FY14 1H15 Other North Island 26% Group % 0.25% 0.22% 0.17% Other South Island New Zealand Mortgages % 0.04% 0.06% 0.01% Other 7% 11% 1. As % of group average NLA. 2. Average LVR at Origination (not weighted by balance). 3. Average dynamic LVR as at (not weighted by balance) Dynamic LVR graph as at Feb Excludes revolving credit facilities. 5. Individual Provision as % average NLA. 67

68 Group Overview

69 Profit & Loss contribution by division Group Overview $m 12,000 10,000 8,000 6,000 4,000 2,000 Operating Income by Division 0-2,000 1H12 2H12 1H13 2H13 1H14 2H14 1H15 Australia New Zealand IIB Wealth GTSO/Gp Centre Operating Income by Division 1H15 Australia New Zealand IIB Wealth 8% 42% 37% 13% $m 4,000 3,000 Net Profit after Tax by Division Net Profit after Tax by Division 6% 6% 6% 6% 8% 7% 9% 7% 2,000 1, H12 2H12 1H13 2H13 1H14 2H14 1H15-1,000 Australia New Zealand IIB Wealth GTSO/Gp Centre 40% 32% 38% 38% 39% 37% 40% 11% 11% 12% 15% 16% 15% 15% 44% 45% 44% 44% 42% 44% 44% -1% -1% -4% -3% -4% -6% 1H12 2H12 1H13 2H13 1H14 2H14 1H15 Australia New Zealand IIB Wealth GTSO/Gp Centre 69

70 Profit & Loss contribution by geography Group Overview Operating Income by Geography Operating Income by Geography 1H15 $m 12,000 10,000 8,000 6,000 4,000 2,000 0 Australia New Zealand APEA 1H12 2H12 1H13 2H13 1H14 2H14 1H15 Australia New Zealand APEA 18% 20% 25% 62% APEA Network APEA Network Revenue 1 represents income generated in APEA plus income generated in Australia & New Zealand as a result of referral from ANZ s APEA network. $m 4,000 3,000 2,000 1,000 0 Net Profit after Tax by Geography 1H12 2H12 1H13 2H13 1H14 2H14 1H15 Australia New Zealand APEA Net Profit after Tax by Geography 15% 18% 14% 17% 19% 15% 20% 16% 18% 18% 19% 23% 20% 21% 68% 65% 68% 64% 57% 64% 59% 1H12 2H12 1H13 2H13 1H14 2H14 1H15 Australia New Zealand APEA 1. APEA Network Revenue represents income generated in Australia & New Zealand as a result of referral from ANZ s APEA network. 70

71 Total Credit Exposure (EAD) by Geography Group Overview Exposure at Default 1 by Geography Exposure at Default by Line of Business 2 Total Exposure at Default (Mar 15) - $869b 1 Australia New Zealand APEA $515.8b $149.5b $204.1b 16% 29% 31% UK & Europe 4% New Zealand 17% 22% 94% Americas 4% Pacific Singapore 1% 4% APEA 24% Australia 59% 53% 49% Hong Kong 3% Other North East Asia 6% Other South East Asia 2% 6% Australia New Zealand APEA Retail Institutional Commercial 1. EAD excludes amounts for Securitisation and Other Assets Basel asset classes. 2. Institutional includes exposure to Bank and Sovereign counterparties and ANZ s Liquidity portfolio. 71

72 Regional delivery network and common platforms Enterprise Approach Regional delivery network Providing full service regional coverage across our operating time zones Chengdu Developing centres of excellence across the Bangalore Hong Kong Manila network around key business domains: Payments Voice Singapore Suva Markets Trade FIO, AML and Sanctions Sydney Auckland Secured Lending Unsecured Lending Wealth Operations Technology Melbourne Wellington Wholesale Lending Global Wholesale Digital (Transactive) 17 countries Global Payments (Global PayPlus) 10 countries Common platforms Global Retail Digital (gomoney, Grow) 7 countries Global FX (Wallstreet) 13 countries Global Process Management (PEGA, FileNet) 15 countries Global Customer Registry (IBM MDM) 25 countries 72

73 Enterprise approach delivering a consistent, higher quality experience for our customers Enterprise Approach Delivering productivity initiatives More effective resourcing Improved project delivery Index: FY10=100 Operations efficiency Operations productivity improvement Processes reengineered Improving customer experience Easier on-boarding Faster approvals Consistency across channels FY10 FY11 FY12 FY13 FY14 1H15 Quality and service Customer satisfaction by channel 2 Reducing operational risk Consistent standard processes Upgraded infrastructure and systems 91.4% 90.2% 88.9% 88.7% 80.8% Website 3 4 Smart device Branch Personal Banker Financial Adviser 1. Operations efficiency measured by operations productivity improvement, which is the difference in operations costs and volume growth. 45% productivity improvement over 4 ½ years. 2. Roy Morgan Research. Satisfaction with channel, experience amongst MFI customers who have used service in the last 4 weeks. Base: ANZ Main Financial Institution (MFI) Customers, age 14+, rolling 12 months to March Internet Banking using institution s website. 4. Internet Banking using an app on mobile phone or tablet. 73

74 Enterprise approach higher volumes at lower cost through regional network & common platforms Enterprise Approach Operations volume growth 1H14-1H15 1 9% 9% 7% 7% 6% Australia IIB NZ Wealth Total Operations costs growth 1H14-1H15 1 2% -2% -3% -4% -5% Australia IIB NZ Wealth Total Record volumes on platforms New single-day retail activity records (Dec 14): 1,746 loan settlements& releases 1.6m gomoney logons 10m merchant payment transactions 723,000 ATM transactions Transactive volumes in FY15 >5x 2013 levels (on track for $280b in FY15) Supported by 1H15 simplification initiatives: Retired over 5,000 business applications Wholesale loans from >100 to 10 core products 1. Volume growth represents YTD Mar 2015 vs YTD Mar

75 Enterprise Approach Adopting common platforms, utilising regional delivery network to improve customer experience & productivity An enterprise approach to operations and technology Delivers a stronger and more efficient bank Benefiting our customers, employees and shareholders Building Common Technology Platforms Improving customer experience: Easier on-boarding and faster approvals 40bps Operations cost to income across all main business lines to drive standardisation, simplification and automation. Quality service Consistency across channels Driving operational productivity: Absorb significant volume growth Sustainable cost reduction 10% Operations productivity Utilising our Regional Delivery Network to improve customer experience and drive down cost to serve. Simplified processes Reducing operating risk: Consistent, standard processes Reduced error rates Upgraded infrastructure and security systems 28% Customer complaints (Australian Ops) 75

76 Enterprise Approach Annual investment program delivering broad-based enterprise capabilities supporting super regional growth Annual investment spend Capability Benefits Risk Management Infrastructure Security Process Automation Workflow Wholesale Lending Retail Lending Payments Markets Wholesale Digital Consumer Digital Data and Analytics 1. Excludes technology run costs. 12% 19% 15% 26% 28% FY14 ANZ invests approximately AUD1,200m 1 per year on technology-based capabilities. Disciplined management is allowing us to fund an increasing proportion of this annual investment from the productivity gains in our wider delivery cost base. Risk Stability Productivity Product Lines Digitisation Minimised operating risks Maintain the confidence of our customers and regulators Upgraded infrastructure Enhanced resilience Reduced cost-to-serve Simplify and integrate end-to-end workflow Increase systems and process standardisation Re-engineer and automate high-priority enterprise domains Coordinated approach to end-to-end wholesale lending Global capabilities for consumer lending Modern, resilient payments network Supporting markets growth with scalable platforms Consistent customer experience across channels Supporting our segment-based businesses Enterprise-wide data management 76

77 Sustainability Sustainability managing our business to account for social, environmental, economic risks and opportunities ANZ s Corporate Sustainability Framework distinguishes between three key priority areas of the sustainability agenda that are distinctive to ANZ, and five Licence to Operate areas we consider essential to a large company operating in a sustainable, responsible and ethical way. We report biannually on our sustainability performance. Our 2014 Corporate Sustainability Report is available on anz.com. Priority Areas Sustainable Development Progress Increased lower-carbon power generation lending in Project Finance by 16% since Portfolio summary: Coal fired 25.0%, gas fired 25.5%, renewables 49.5% In 2014, ANZ financed projects with lower than average emissions intensity: Australia: 0.69 tco 2 /MWh 2 (20% lower than average Australian intensity) Offshore: 0.24 tco 2 /MWh 2 (17% lower than average intensity in relevant countries) Diversity and Inclusion Financial Inclusion and Capability All roles in Australia and NZ are now flexible, to support a diverse and inclusive workplace Focus on gender balanced leadership through structural, behavioural and programmatic interventions FY14 employee engagement score: 73%, with a target of 75% in FY15 MoneyMinded financial education program: >294,000 participants in 20 countries Go Money: >125,000 customers registered in the Pacific, with ~71,000 new to bank 1. As a proportion of our total project and structured finance power generation portfolio. Our target is to increase the proportion by 15-20% by Represents average emissions intensity of electricity generation from projects financed by ANZ. tco 2 /MWh represents tonnes of CO 2 per megawatt hour of electricity generated. 77

78 Divisional Performance

79 Australia Division Aus. Division Profit and Loss delivering growth with continued investment, improved productivity & efficiency Australia Division Revenue and Expenses CTI: 38.1% 37.0% 36.7% $m 3,869 4,001 4,241 1,475 1,479 1,556 1H13 1H14 1H15 Income Expenses CAGR 4.7% 2.7% $m Growth % 1H15 PCP Income 4, % Expenses 1, % PBP 2, % Provisions 395 (1.7%) NPAT 1, % Retail Income 2, % Expenses 1, % PBP 1, % C&CB Income 1, % Expenses % PBP 1, % PBP, Provisions, NPAT 1H profit driven by volume growth $m 2,685 $m 2,394 2,522 CAGR Net interest income 1,409 1, % 1, ,602 (77) 1,483 (51) 6.6% H13 1H14 1H15 PBP NPAT Provisions 1H14 Vol. Margin Vol. Margin OOI Exp Prov Tax 1H15 Retail C&CB 79

80 Mar 13 New Fundings, Redraws & Interest Net Personal Loans and Cards Repay/ Refis / Other Mar 14 New Fundings, Redraws & Interest Net Personal Loans and Cards Repay/ Refis / Other Mar 15 Aus. Division Balance sheet growing FUM and improving mix Australia Division Loans & Deposits Lending composition $b $b Mar 13 Mar 14 Mar 15 Lending Deposits Mar 13 Mar 14 Mar 15 Home Loans Other Consumer Business Lending Lending flows Deposit mix improving $b % 11% 12% 41% 37% 31% (67) (70) % 14% 16% 35% 38% 41% Mar 13 Mar 14 Mar 15 Transact & Save Online TD Offset 80

81 Australia Division Delivering to strategy, managing margins & costs while maintaining credit standards Balanced margin management 1 Investing for growth 2.53% 2.50% 2.50% Percent mix of Retail Sales and Service FTE 60% 55% 50% 45% 1H13 1H14 1H15 40% Mar 13 Mar 14 Mar 15 Sales FTE Service FTE Cost to Income 38.1% Improving Cost to Income 0.39% Credit quality Net Impaired Assets / Net Loans & Advances 37.0% 36.7% 0.26% 0.22% 1H13 1H14 1H15 1H13 1H14 1H15 1. NIM %: Half year period average. 81

82 Delivering innovative solutions that are aligned to changing customer needs Australia Division Delivering innovative solutions leading to increasing digital usage World first to roll out Tap and Pin contactless ATMs 813 Smart ATMs deployed Rolled out WiFi into branches, enabling gomoney app activation at account opening Percent Sales 1 via Digital 9.5% 12.9% 14.4% Percent Transactions 2 via Digital 70.4% 72.4% 73.9% Market leading multi-factor authentication Innovative home loan solution for mobile lenders (Your Home Loan 360) Digital tools and calculators 1H14 2H14 1H15 1H14 2H14 1H15 while reducing customer complaints Average Monthly Complaints -19% -9% -17% Interactive Insights for frontline bankers in Corporate Banking Digital A-Z reviews across Retail and C&CB FY12 FY13 FY14 1H15 1. Sales includes the number of sales events through the Retail distribution network, including all Retail, Commercial and Wealth products. 2. Transactions refers to the number of value transactions through all channels including internet, mobile, teller and ATM. 82

83 Growth is being delivered sustainably Australia Division Building our sales reach Increasing sales capability 600 Additional sales FTE from 1H14 40k Hours of training for C&CB staff in 1H15 P Investing in priority segments Small Business, Emerging Corporate, Health 670 Additional Retail staff trained in sales of Home Loans, Wealth, and Small Business products 63% Growth in Digital sales from 1H % Increase in Home Loan sales across all channels Enhancing the customer experience Expanding customer awareness 74% Transactions 2 via digital channels, up from 70% in 1H14 P #51 most valuable brand globally and ranked #2 of the 4 major Australian banks 3 P Deployed a global asset finance platform providing faster and easier applications and fulfilment P 2015 Australian Lending Awards Best customer experience, Best Investor Lender, Mortgage Lender of the year 17% Drop in average monthly complaints from FY14 #2 Purchase intention for Australian banks 4 1. Sales include Retail, Wealth, and Commercial sales and referrals through Retail digital channels. 2. Transactions refers to value transactions through internet, mobile, teller, and ATM BrandZ Top 100 most valuable global brands by Millward Brown. 4. Ipsos, Mar

84 Retail Australia Division Growing customer acquisition Deeper customer relationships Customer numbers 1.3% 1.8% 2.9% Retail Products per customer % of total customers 9.0% 9.3% 9.4% 47.6% 48.6% 49.0% 43.4% 42.1% 41.6% Mar 12 Sep 12 Mar 13 Sep 13 Mar 14 Sep 14 Mar 15 Increasing Sales Sales Events 7.1% 1H14 2H14 1H15 APRA Traditional Banking Market Share 1 Index Sep 12 = Mar 13 Mar 14 Mar Growing market share 97 Sep 12 Mar 13 Sep 13 Mar 14 Sep 14 Mar 15 ANZ Peer 1 Peer 2 Peer 3 1. Inclusive of Deposits, Home Loans and Cards, Source: APRA. 84

85 Corporate & Commercial Banking Australia Division Growth in Customer numbers Continuing to grow the business % 5% H13 1H14 1H15 Lending ($b) Deposits ($b) Customers ('000) 1 Targeting key growth segments & leveraging super regional connectivity Prioritising higher growth opportunities to drive outperformance Investments to enhance Small Business and Emerging Corporate propositions contributing to performance Supporting customers across the region with dedicated specialists, cross-border processes, research and insights Increasing banker capability and connectivity through super regional experience, training and specialist tools.. With strong growth in our priority segments Small Business Banking 2 15% Emerging Corporate 2,3 20% Can service my business needs #1 across Australia, New Zealand and Asia H14 Lending 1H15 Revenue 1H14 Lending 1H15 Revenue ANZ Peer 1 Peer 2 Peer 3 1. Customers exclude Esanda contracts. 2. Percentages represent lending growth. 3. A subset of Business Bank, lending greater than 10m and turnover greater than 40m. 4. Proportion of Commercial customers ($1m to <$40m turnover) associating institution with the statement can service my business needs across Australia, New Zealand and Asia, rolling 3 month average, DBM Business Financial Services Monitor, Mar

86 Australia Division - strengthening ANZ's position in core markets by delivering a leading customer experience ANZ Group Strategy Australia Division Strengthen our position in our core markets of Australia & New Zealand STRONG CORE MARKETS Connecting customers to faster growing regional capital, trade & wealth flows PROFITABLE ASIAN GROWTH Built on common infrastructure & enterprise focus for greater responsiveness, efficiency and control ENTERPRISE APPROACH Australia Division s contribution Deliver customers an easy, connected and insightful experience that puts the customer in control Achieve consistent above system growth focused in priority segments Maintain strong margins, cost discipline and risk profile Leverage our Super Regional advantage to bring the whole of ANZ to customers Take an enterprise wide approach and leverage global assets Banking on Australia is transforming our Retail and Corporate & Commercial businesses based on a deep understanding of customer needs Customer Needs Customer Value Proposition Transformation Financial Outcomes Developing a deep understanding of customer needs in our target segments Building a compelling customer value proposition that is aligned to their needs Investing through our Banking on Australia program to meet changing customer needs Growing market share, managing margins and costs and maintaining asset quality 86

87 NZ Division Profit and Loss New Zealand Division Revenue and Expenses NZ$m Growth % 1H15 PCP NZ$m 1,319 1,361 1,437 2YR CAGR 4.4% Income 1, % Expenses % PBP % Provisions 20 large NPAT % Retail & SBB Income % -1.7% Expenses % PBP % New Zealand Division 1H13 1H14 1H15 Income Expenses CommAgri Income % Expenses % PBP % PBP, Provisions, NPAT Productivity & Efficiency NZ$m (37) YR CAGR 9.1% 10.7% 45.2% 41.3% NZ$ % H13 1H14 1H15 PBP NPAT Provisions 1H13 1H14 1H15 CTI Revenue per FTE (RHS) 0 All values in New Zealand Dollars. All data relates to New Zealand Division, which comprises Retail and Commercial business units. 87

88 Mar 13 New TopUp Exit Repay Mar 14 New TopUp Exit Repay Mar 15 NZ Division Balance Sheet New Zealand Division Net loans, Deposits and NIM Lending composition NZ$b % 2.6% 2.5% NZ$b LDR 173% LDR 171% LDR 162% 1H13 1H14 1H15 Lending Deposits NIM (RHS) Customer lending flows 1 2.4% 2.3% Mar 13 Mar 14 Mar 15 Home Lending Business Lending Rural Lending Other Lending Credit Quality NZ$b (9.5) 94.8 (7.3) 9.1 (9.9) (7.7) Gross Impaired Assets / Gross Loans and Advances % 0.75% 0.44% Mar 13 Mar 14 Mar 15 All values in New Zealand Dollars. All data relates to New Zealand Division, which comprises Retail and Commercial business units. 1. Gross Loans and Advances excluding capitalised brokerage/mortgage origination fees, unearned income and customer liabilities for acceptances. 2. Includes capitalised brokerage/mortgage origination fees, unearned income, and customer liabilities for acceptances. 88

89 NZ Retail and Small Business Banking New Zealand Division 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% Home loans Market share 1 Mar 13 Mar 14 Mar 15 Household deposits Credit cards Products per customer % of Retail customers 14.2% 15.6% 18.4% 46.7% 47.3% 46.7% 39.1% 37.1% 34.9% Mar 13 Mar 14 Mar Customer numbers Revenue per Branch and FTE 3 Gross Retail customer acquisition 59k CAGR 18% 67k 82k 1H13 1H14 1H15 Gross Small Business Banking customer acquisition 2 2.6k CAGR 15% 3.4k 3.5k 1H13 1H14 1H15 NZ$m Yr CAGR: 18% % NZ$k 1H13 1H14 1H15 Revenue per Branch Revenue per FTE (RHS) All values in New Zealand Dollars. 1. Source: RBNZ - Mar 2015, relates to NZ Geography. 2. Customer groups acquired. 3. Revenue and FTE based on NZ Division. 89

90 Commercial & Agri New Zealand Division 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% NZ$b Commercial deposits Loans and deposits Loans CAGR 5% Market share 1 Mar 13 Mar 14 Mar 15 Agri deposits Commercial lending Agri lending Deposits CAGR 10% UDC Agri Commercial Focus on Quality 65% 68% 67% 25% 26% 28% 10% 6% 5% Mar 13 Mar 14 Mar 15 Commercial cross-sell recognised in other segments Credit quality EAD distribution by Credit Rating groups NZ$m Agri Institutional Risk Rating Stronger Weaker % 38% 38% 58% 58% 58% 7% 4% 4% Mar 13 Mar 14 Mar 15 Retail & Wealth Commercial Mar 13 Mar 14 Mar 15 Mar 13 Mar 14 Mar 15 1H13 1H14 1H15 All values in New Zealand Dollars. 1. Source: RBNZ - Mar 2015, relates to NZ Geography. 2. Retail includes Small Business Banking. 90

91 Home loans New Zealand Division Home Loan Market Share 1 #1 in Auckland and Christchurch % 31.0% 31.2% Share of total home loans registrations in Auckland 29% 30% 30% 29% Share of total home loans registrations in Christchurch 28% 28% 26% 25% Mar 13 Mar 14 Mar 15 1H13 1H15 ANZ 1H13 Leading peer bank 1H15 Home Loan sales by Channel 3 Home Loan book composition Retail MMM Broker Small Business Banking 22% 22% 100% 75% ANZ % Fixed Rate mortgages in portfolio Sales mix 27% Variable 32% 38% 17% 12% 50% 73% Fixed 28% 29% 1H13 1H15 All values in New Zealand Dollars. 1. Source: RBNZ - Mar 2015, relates to NZ Geography. 2. Source: Core Logic. Leading peer bank Auckland ASB, Christchurch Westpac. 3. Retail Branch and Contact Centre, MMM - Mobile Mortgage Manager. 25% Mar 09 Mar 11 Mar 13 Mar 15 Mar 15 91

92 Growth is being delivered sustainably New Zealand Division Building our sales reach Increasing sales capability 62% Of frontline are now made up of Sales Staff, compared to 59% in 1H14 30k More hours created for Sales and Service staff through process improvements P Investing in priority segments Auckland, Christchurch, Migrants, Small Businesses and Corporate Agri P Increased staff training hours and credit writing capabilities 38% Increase in sales revenue from Digital sales, compared to 1H14 100% Mobile Sales force with ipad capability to enable better customer interactions on the go Enhancing the customer experience Expanding customer awareness 200k Card PINs set digitally in 7 months, since the introduction of the capability 44% Continuing to have the best customer consideration 1 score amongst the top 4 banks P New systems providing staff the ability to better manage and action customer feedback 65% Transactions via digital channels, up from 59% in 1H14 20% Drop in the average number of problems reported by customers from FY14 10% Increase in Commercial & Agri customers belief that ANZ provides insights that deliver value to their business 1. Source: McCulley Research Limited (first choice or seriously considered) Mar

93 Creating New Zealand s best bank New Zealand Division ANZ Group Strategy S tre ngthen our p osition in our core mark e ts of A ustralia & New Zealand STRONG CORE MARKETS Connecting custome rs to f a ster g rowing re g ional capital, trade & wealth flows PROFITABLE ASIAN GROWTH B uilt on common inf ra - structure & e nterp rise f ocus f or g re a ter re sp onsiv e ness, e f f iciency a nd control ENTERPRISE APPROACH ANZ New Zealand s Strategy A ttract, d e v e lop a nd re tain world class se rv ice and sales teams De v e lop our d ig ital a nd payme nts capability Imp rov e the use of b a nk wid e d a ta for b e tter custome r interactions Imp rov e the way our channels work tog e ther so it s e a sier f or custome rs Continue to simp lif y our p rod ucts a nd p roce sse s NZ s Best Bank Leverage Scale How? NZ s Best Bank Create Scale How? One team One set of systems One product set One brand One branch network How? Global hubs Branch optimisation Improve brand recognition World class sales and service teams Upgrade core systems Digital and Payments infrastructure Best service recognition Best brand consideration Integrated channels Leveraging Group capabilities Data driven customer insights Automation of work flow Optimised channel investment Our Vision: Helping Kiwis achieve more Our Goal: #1 Service #1 Market Share Growing Visible in the community

94 NZ Geography Profit and Loss New Zealand Geography Revenue and Expenses NZ$m Growth % 1H15 PCP 1 NZ$m NZ$m Income 1, % Expenses % 1,760 1,904 1,931 2YR CAGR 4.7% PBP 1, % Provisions 31 large NPAT 841 (5.2%) NZ Division Income 1, % -1.8% Expenses % Institutional Income % New Zealand Geography 1H13 1H14 1H15 Income Expenses Expenses % Wealth Income 156 (31.6%) Expenses % PBP, Provisions, NPAT Productivity & Efficiency NZ$m NZ$m ,179 1, YR CAGR 9.6% 43.6% NZ$k % 38.1% 38.3% (39) 31 1H13 1H14 1H15 PBP NPAT Provisions 1H13 1H14 1H15 CTI Revenue per FTE (RHS) All values in New Zealand Dollars. All data relates to New Zealand Geography, which comprises the New Zealand components of New Zealand Division, IIB, Global Wealth, GTSO and Group Centre divisions. 1. Excluding one off insurance recovery related to the ING frozen funds PCP growth rates: Income 6.5%, PBP 9.6%, NPAT 2.3%, Wealth Income 13.0%. 94

95 Mar 13 New TopUp Exit Repay Mar 14 New TopUp Exit Repay Mar 15 NZ Geography Balance Sheet New Zealand Geography Net loans, Deposits and NIM 1 Lending composition NZ$b % 2.6% 2.5% NZ$b LDR 141% LDR 138% LDR 136% 2.4% NZ$b 1H13 1H14 1H15 Lending Deposits NIM (RHS) Customer lending flows 2 2.3% (10.7) (10.0) (9.0) (8.7) Mar 13 Mar 14 Mar 15 Home Lending Business Lending Rural Lending Other Lending Credit Quality Gross Impaired Assets / Gross Loans and Advances % 0.82% 0.48% Mar 13 Mar 14 Mar 15 All values in New Zealand Dollars. All data relates to New Zealand Geography, which comprises the New Zealand components of New Zealand Division, IIB, Global Wealth, GTSO and Group Centre divisions. 1. New Zealand Geography NIM excludes Markets. 2. Gross Loans and Advances excluding capitalised brokerage/mortgage origination fees, unearned income and customer liabilities for acceptances. 3. Includes capitalised brokerage/mortgage origination fees, unearned income, and customer liabilities for acceptances. 95

96 IIB has grown revenue and profit International & Institutional Division (IIB) Revenue has grown 5% Increasing OOI $m 3,277 1,454 3,622 1,627 3,786 1,771 2 Yr CAGR 7% 10% PCP 5% 9% $m 3,622 3,786 3,277 1,629 1,759 1,502 1,775 1,993 2,027 IIB 1H13 1H14 1H15 Income Expenses 1H13 1H14 1H15 OOI NII Delivering 7% NPAT growth Improving revenue per FTE $m 2 Yr $k 1,995 2,015 CAGR 1, % 1,368 1,459 1,199 10% % 44% 45% 300 PCP 184 1% % 100 1H13 1H14 1H15 1H13 1H14 1H15 PBP NPAT Provisions CTI Rev per FTE (RHS) OOI / FTE (RHS) 96

97 Our Balance Sheet is growing prudently International & Institutional Division (IIB) IIB Balance Sheet A benefit of ANZ s Super Regional Strategy: surplus deposits contribute strongly to the Group s Liquidity Coverage Ratio (LCR) $b $b Institutional client franchise assets % 1.25% 1.23% Loans Dep. Loans Dep. Loans Dep. Mar 13 Mar 14 Mar 15 Retail Institutional 1H13 1H14 1H15 NLAs RWA 1 RoRWA (RHS) Gross impaired assets as a % of GLAs 1.70% IIB credit quality remains high Strong risk grade profile 2 By total exposure (%) By tenor 1H15 (%) 1.06% 22% 22% 20% 29% 64% 63% 0.67% 0.65% 0.49% 0.46% 77% 75% 79% 71% 36% 37% Mar 13 Mar 14 Mar 15 IIB Total IIB Asia Mar 13 Mar 14 Mar 15 Asia Aus NZ Default Sub Inv Grade Inv. Grade Tenor >1Yr Tenor <1Yr 1. RoRWA equals Net Profit After Tax divided by average Basel III risk weighted assets. Insto customer includes Global Loans, Global Transaction Banking, Global Markets Sales, and Global Markets Trading ex Balance Sheet. 2. Institutional exposures only. 97

98 Revenue and profit composition International & Institutional Division (IIB) $m 41% 8% 51% Revenue is geographically diverse 3,622 3,786 1,467 1,412 37% % 1,864 2,061 55% $m 41% 11% 48% APEA now represents over half of the division s NPAT 1, , % 11% 53% 1H14 1H15 APEA NZ Aus 1H14 1H15 APEA NZ Aus Growing higher ROE businesses 1 APEA OOI growth is strong $m 12% 30% 17% 41% 2,966 2, % Higher 31% 1,228 ROE 1,242 12% 28% 18% 42% $m 8% 29% 63% 1,759 1, ,026 1,131 11% 25% 64% 1H14 1H15 Markets Cash Global Loans Trade 1H14 APEA Aus 1H15 NZ 1. Excludes Retail and partnerships. 98

99 The corridor strategy is gaining momentum International & Institutional Division (IIB) USDb Major trade corridors are forecast to grow significantly forecasts Total Australia-China goods trade Source: ANZ Economics Trade revenue has a multiplier effect 1H15: $1 of Trade income = $1.40 of Cross-Sell Corridor strategy is delivering strong growth Revenue Growth (1H15 PCP) 22% Aus/ China 30% Aus/ Singapore 48% China/ HK 59% Aus/ HK Increasingly winning multi country mandates 2 Number of multi country customer mandates won Trade Revenue Markets & Cash income from Cross Sell Combined Revenue 1H14 2H14 1H15 1. Cross-sell multiple based on a pool of customers that have a minimum of Trade, Markets and Cash Management with ANZ. 2. Payments and Cash Management mandates, based on Transactive Asia Strategic transactions for client with 2 or more countries. 99

100 International & Institutional Division (IIB) Trade and Cash Management are delivering in tougher conditions PCM Revenue is at record levels Deposit growth is strong $m % % % $b % 14% 17% 18% 14% 19% 1H13 1H14 1H15 APEA NZ Aus Trade revenues have remained broadly flat Mar 13 Mar 14 Mar 15 Trade revenues broadly flat despite a significant decline in commodity prices $m % 5% % 6% % 6% 7% 31% 36% > 180 days days days Oil Price movement ANZ Trade Book 43% 13% 54% 57% 58% 26% 0-30 days 44% 1H13 1H14 1H15 APEA NZ 1H15 Aus 1H15 Resources Agriculture DI 100

101 Global Markets delivered record income International & Institutional Division (IIB) Customer facing Global Markets revenue is growing $m Income by region ($m) 1,228 1,242 1,242 1,108 22% 21% 1,108 14% 22% 13% 27% 26% 24% >75% 46% 37% customer 51% 52% 55% facing 41% 49% Delivering growth across a diverse product range Income by product 1 ($m) 6% 3% 6% 9% 17% 12% 23% 29% 48% 47% 300 1H13 1H14 1H15 Balance Sheet Trading ex BS Sales Asia Global Markets revenues have significant growth potential, given low market share FX Market share 1.18% 33% $m 2 3 $ 1H13 1H15 APEA Aus NZ Risk position remains conservative FX 1H13 1H15 Commodities Rates Others Capital Markets North Asia SEA NZ 0 1H13 2H13 Sales/Trading per $ VaR 1H14 2H14 1H15 Balance Sheet per $ VaR 1. Excludes Balance Sheet. 2. Euromoney, Peter Lee Associates 2014 Foreign Exchange survey, New Zealand. 101

102 Balance Sheet usage is increasingly targeted International & Institutional Division (IIB) $m Global Loans margin compression was partially offset by volume growth 93 NIM impacts most severe in Australia 3% 877 (120) (6) 845 2% 1% 1H14 Vol Rate OOI 1H15 Continuing to diversify the Global Loans balance sheet $b (NLA) 0 1H13 2H13 1H14 2H14 1H15 Aus NIM Asia NIM Clear focus on generating cross-sell 56% 7% 37% % 7% 47% 56% 31% 28% 51% 69% 7 72% 42 IIB provides 3+ products to 72% of lending clients Mar 13 Mar 14 Mar 15 APEA NZ Aus 1H14 3+ products 1H15 < 3 products 102

103 IIB Asia is growing profitably International & Institutional Division (IIB) IIB Asia NPAT has grown 8% PCP with revenue growth in higher ROE businesses 2 USDm 1.51% 1.63% USD m 24% % 1.23% % 8% 43% % 9% 48% Higher ROE 1H13 1H14 1H15 1H13 1H14 1H15 NPAT RoRWA 1 IIB Markets Cash Global Loans Trade and increasingly from OOI with improving productivity USDm 1.5 USDk % 55% 56% % 45% 44% 61% 55% 54% H13 OOI 1H14 NII 1H15 1H13 CTI 1H14 Rev/FTE (RHS) 0 1H15 OOI/FTE (RHS) 1. RoRWA equals Net Profit After Tax divided by average Basel III risk weighted assets. 2. Excludes Retail and Partnerships. 103

104 Making progress on our strategic priorities IIB PRIORITIES Connecting More Customers by Providing Seamless Value Delivering Leading Products through Insights Outcomes for the business Corridor Management strategy gaining traction, with revenues up ~30% pcp along the 3 main Australia-Asia trade corridors - China, Hong Kong and Singapore # 1 for overall and lead bank penetration in Australia 1 # 1 for overall and lead bank penetration in New Zealand and widened the gap with # 2 2 # 4 corporate bank in Asia and narrowed the gap to # 3 3 # 1 in AU & NZ Bonds 4 & # 1 in AU & NZ Syndicated Loans 5 Best Trade Finance Bank AU & NZ 5 & Best Bank for Cash Mgt Asia Pacific 6 Best Foreign Exchange Provider, Asia Pacific 7 Precious Metals House of the Year, Asia 8 Intensifying Balance Sheet Discipline Several initiatives were completed resulting in >$1bn RWA reduction Progress on transitioning of non-core customers Scaling & Optimising Infrastructure Electronic channel utilisation for payments increased from 39% to 45% Enterprise approach delivering a 2% cost reduction PCP despite a 7% increase in IIB Operations volumes Personnel expenses are well controlled Flat PCP (excluding FX impact) 1. Peter Lee Associates: 2014 Large Corporate and Institutional Relationship Banking survey, Australia. 2. Peter Lee Associates: 2015 Large Corporate and Institutional Relationship Banking survey, New Zealand (widening based on lead bank relationships). 3. Greenwich Associates 2014 Asian Large Corporate Banking Study. 4. Dealogic by lead bank apportioned deal value, Jan Thomson Reuters, Global Syndicated Loans Review FY Trade & Supply Chain Finance Awards, Global Finance, Best Foreign Exchange Provider Awards, Global Finance, Energy Risk, Asia,

105 Global Wealth performance continues to strengthen Global Wealth Global Wealth Revenue & Expenses $m CAGR 6.9% % 1H13 1H14 1H15 Income Expenses Improved productivity (CTI) 1,2 % 490bps $m Growth % Growth (ex Trustees) 1,2 1H15 PCP PCP Income % 6.9% Net Interest % 10.0% Other Operating 97 (19.2%) (10.2%) FM & Insurance % 9.6% Expenses % 1.9% PBP % 14.6% NPAT % 13.6% NPAT contribution: Business Funds Mgt % 20.0% Insurance % 45.9% Private Wealth 43 (2.3%) 13.2% Geography Australia % 28.4% New Zealand 62 (12.7%) (12.7%) APEA (2) Large Large 1H13 1H14 1H H14 revenue normalised for Trustees related income of (-$12m) and Trustees related expenses of ($4m). 2. 1H13 revenue normalised for Trustees related income of (-$10m) and Trustees related expenses of ($7m). 105

106 Positive volume growth in Private Wealth and Funds Management Global Wealth Funds Management Average FUM 1 Private Wealth 2 $b CAGR 10.2% $b YR CAGR 25.5% 3.3% $m 1H13 1H14 1H15 Funds Management netflows 1 1, $m 1,087 1H13 1H14 1H15 Net Loans and Advances Average Customer Deposits Reshaping our funds business to customer centric digital solutions 558 1H15 netflows (442) (1,024) (1,057) 1H13 2H13 1H14 2H14 1H15 ANZ Smart Choice Super ANZ KiwiSaver ANZ Private Wealth OneAnswer Frontier Open customer solutions Oasis Voyage Retail Employer Super Closed solutions 1. Average FUM and netflows includes Private Wealth Investment FUM and netflows. 2. Net loans & advances excludes Corporate banking deposits and includes E*TRADE investment lending. 106

107 Sep 14 Value of New Bus. Expected Return Experience Deviations Risk Disc. & FX Subtotal Net Transfers Mar 15 Global Wealth Focus on profitable Insurance business lines is delivering strong growth in Embedded Value $m Stable mix of Life Insurance In-force 1,445 1,468 1,636 30% 23% 24% 10% 12% 12% 60% 65% 64% Continued improvement in Australian Retail Life Insurance Lapse Rates 13.3% 12.1% -50bp 11.6% Mar 13 Mar 14 Mar 15 Group - Australia Individual - New Zealand Individual - Australia 1H13 1H14 1H15 Consistent product mix in Individual Life Significant contribution to Embedded Value Insurance growth over 1H15 $m 144 4,394 $m 4,218 1,006 1,132 1, , (176) 27% 28% 28% 73% 72% 72% 13% Mar 13 Mar 14 Mar 15 Lump Sum Income Protection 107

108 Delivering on our strategy Global Wealth 1 2 Global Wealth strategic objectives Deepen relationships with existing ANZ customers Simplify the business with self-directed solutions 3 Drive value from existing businesses Growing solutions through ANZ channels Wealth Solutions Held #m +9.4% Non-ANZ channels ANZ channels CAGR (2.1%) +15.0% Mar 13 Mar 14 Mar 15 Simplifying with self-directed solutions ANZ Smart Choice Super Exceeding $3 billion in FUM 1600 Received 5 stars by CANSTAR in every 1400 superannuation category Over a 300% increase in customer 800 rollovers since the introduction of the 600 paperless rollover service (70% self 400 directed) 200 Over 150,000 downloads with an 0 activation rate of 66% Deepening relationship with the Bank ANZ Smart Choice 435 Digital delivering growth Online rollover innovation released 775 1, ,404 Mar 13 Mar 14 Mar 15 FUM ($m) Ave Weekly Rollovers 4,000 3,500 3,000 2,500 2,000 1,500 1,

109 Home Loan case study

110 Long term growth through leading proposition, investing in capability to make it easy for customers Home Loan Case Study Building our sales reach Enhancing the customer experience Expanding customer awareness 43% $30b 17% $8.6b 5 years 12mth increase in Mobile Lending loan writers with NSW up 50% 1H15 Home Loan Sales across all channels vs. PcP 1H15 Home Loan FUM growth of $8.6b, up from $6.7b 1H14 Sustained above System growth 1 6 days Same day 1,000 hours per month 53% 300k Assessment available 6-days a week delivering same day assessment for over 90% of applications Process improvements freeing up front line capacity to serve more customers per month Complaint reduction over 3 years through end-to-end process re-engineering & reliable settlements Number of hits per month on ANZ.com tools and calculators Consistently award winning 2015 Australian Lending Awards; Best Customer Experience Best Investor Lender Mortgage Lender of the year We help our customers be informed Over 180,000 ANZ property profile reports distributed over the last 12 months Providing super-regional capability Expanded our Non Resident proposition to residents of 14 countries 1. 5 years above APRA System quarter on quarter growth to Dec

111 OO Inv Broker Prop. Vic/Tas NSW/ ACT Qld/NT WA SA Consistent above system growth, balanced across the portfolio Delivering 5 years of consistent above system market share growth Balanced growth across segments particularly in NSW Home Loan Case Study Household Lending Market Share Growth (%) Index Sep 12 = Sep 12 Sep 13 Sep 14 ANZ Peer 1 Peer 2 Peer 3 ANZ Growth vs system by segment 1 Feb 15 YTD 1.3x 1.1x 1.0x 1.0x 1.1x 1.3x 1.2x 0.9x 0.8x Strong sales volumes offset by industry high levels of repayments Home loan flows ($bn) % 218 annualised Sep 14 New Sales excl Refi-in Net OFI Refi 7 Redraw & Interest (24) Repay. /Other Mar 15 ANZ Home Loan Portfolio (%) 3 Equity Inv OO Prop Broker 58% 57% 36% 38% 6% 5% Mar 14 Increased portfolio share in NSW/ACT Mar15 46% 47% 54% 53% Mar 14 Mar 15 26% 27% 33% 33% 18% 17% 16% 16% 7% 7% Mar 14 Mar Customer Segments (Owner Occupier and Investor) defined by APRA. Channel performance relative to overall market growth. Geography sourced from Cannex. 2. Source: Comparator quarterly benchmarking. 3. Proprietary, comprising Branch, Mobile and Other. NSW/ ACT VIC/ TAS QLD/ NT WA SA 111

112 Quality assurance, info verification & policy reviews Home Loan Case Study Actively assessing and managing our home lending risk across the end-to-end value chain Multiple checks during origination process Pre-application Application Serviceability Collateral / Valuations Credit Assessment Fulfilment Income & Expenses Know Your Customer Income Verification Income Models Expense Models Interest Rate Buffer LVR Policy LMI policy Valuations Policy Credit History Bureau Checks Documentation Security End-to-end home lending responsibility managed within ANZ Pre-sales (digital & marketing) Proprietary sales and/or verification of 3 rd parties 1 In-house loan origination, assessment, fulfilment Balance sheet ownership Collections activity Originate to hold philosophy Currently all lending is on balance sheet Effective hardship & collections processes Dedicated hardship team Early warning based on system triggers Full recourse lending Multiple actions to manage potential losses ANZ assessment process across all channels ANZ network Broker Digital Mobile 1. 3 rd party sales channels (e.g. Broker) require ANZ accreditation and are subject to ongoing compliance monitoring to distribute ANZ home lending products. 112

113 Australian Market attributes Home Loan Case Study Strong sustained population growth Main markets of Sydney, Melbourne, Brisbane & Perth all growing Australian population growth currently 1.8% vs US 0.7% & UK 0.6% 1 Housing supply Continues to trail population growth (with the exception of certain historical hot spots e.g. Gold Coast ) Culture of repayment Interest is non tax deductible on primary residence Full recourse lending Accelerating repayments (~16% loan buffer based on latest RBA report 2 ) Strong underwriting standards Extremely limited subprime / low doc lending since 2008 Low levels of 100% LVR lending Banks own their credit risks Lenders perform income verification Very low level of securitisation (2% of total housing finance and declining 3 ) aligns origination and underwriting 1. Source: WorldBank Source: RBA Financial Stability Review Mar Source: APRA banking statistics. 113