Geographic Demographic Psychographic Behavioural

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5 Geographic Demographic Psychographic Behavioural Understanding your target market is vital to the success of your business, so if I was to ask you to describe your target market to me, in detail, could you?

6 OUR CUSTOMER STRATEGY

7 Existing Customers Baby Boomers Socially Conscious Small to Medium Enterprises Farming Community Millennials Educated and Affluent Migrants Disability

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9 If you need help identifying your target market or its segments, we can help you. Glen Crandell and Julia Sharwood will be presenting at the Up Close and Personal sessions at 10:45am and 12:50pm tomorrow. Additionally, visit the Customer Voice stall during any of the breaks, or get in touch with your Senior Manager - Community Relationships.

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11 How Delivering in the moment. 1 Understand the local game. 2 Old Fashioned Service. 3 Product and service; in market and can leap frog. 4 Building skills and capability. 5 Not just our role in branches anymore. 6 Accelerate what we do well. Local Connection

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16 Rural Strategy Presentation National Community Bank Conference (Metro) September 2016

17 to provide exceptional financial services, knowledge and leadership for Australian farmers to grow

18 we need to grow more food in the next 40-years than we have in the past 10,000 2 billion extra people by billion middle class in Asia by 2050

19 Earth according to geography

20 Earth according to population

21 The future for agriculture is bright Global food demand is increasing. Australia is well positioned to be an exporter of premium produce, targeting the growing global middle class World consumption by 2050 Sheep and goat meat 2007 Beef and veal 2050 Dairy products Fruits and vegetables ,000 1,500 2,000 ABARE projections Every farm gate $1 generates a further $5.10 along the value chain 1 Currently, each Australian farmer grows enough food to feed 600 people, 150 at home and 450 overseas. 2 There are about 135,000 farm businesses in Australia 99% of which are family owned, and produce ~ 93% of the domestic food supply 3 In 2013/2014 Agriculture accounted for about 2% of Australia s total GDP (farm gate) and 15% of Australia's non-services GDP 4 Trade Agreements are opening up export markets and reducing the red tape with China (ChAFTA), Korea (KAFTA), Japan (JAEPA) and the 12 countries of the Trans-Pacific Partnership (TPP) Mining boom myth busted agri is the glamour industry Mining Agriculture 1.4b $250b $436b Australia has the 2 nd highest % of farmers aged <35 years in the world 5 NZL AUS POL CZE AUT CAN FIN FRA DEU HUN KOR LVA GRC IRL DNK BEL EST SWE USA ESP LTU ROU SVN NLD JPN BGR ITA CYP GBR PRT Source 1: Neil Clark & Assoc 2: National Farmers Federation 3 & 4: ABARES 5: Neil Barr k Employment Contribution to Aust. economy NCA Jun

22 The Rural Strategy Customer Customer growth plan and strategy under development The future for agriculture is bright. The challenges and opportunities. Environment People Shareholder Industry Drivers People & Culture and Rural Muster programs underway Ongoing contribution to strategic planning and investor engagement Industry leadership program in planning phase Brand strategy and implementation plan under development Process / systems strategic initiatives LVC and ABTI underway Partners Elders and BEN alignment program underway Provide exceptional financial services, knowledge and leadership for Australian farmers to grow. 5 pillars of the transformation platform Targets Initiatives Growth plan Slide 2

23 our customer Farm turnover $750k to $5m Intergenerational ownership, clearly defined corporate structure Sophisticated production and marketing High per capita users of technology

24 While farm businesses are consolidating, foreign ownership of businesses and land is in the minority Within the agriculture sector, lending is shifting towards medium to large operations as we see a consolidation of farm numbers 180, , , , ,000 80,000 60,000 40,000 20, >$500k $22-200k $ k <$22k ~99% of Australian farm businesses are fully Australian owned and just under 90% of farmland is fully Australian owned. Source: ABARE, ABS Location of agricultural businesses There has been a sizeable change in agriculture over the last 5-8 years with significant consolidation as enterprises look for economies of scale The number of commercial farms with income > $200k have remained steady while others have been reducing rapidly, highlighting the rationalisation of unviable enterprises. Source: ABS 2015 Less than 50 businesses accounted for 95% of the total area of foreign owned farm land in Australia Page 9

25 the family corporate farmer health marketing risk production risk human capital debt and equity

26 Customer snapshot 30 April 2016 Customer segmentation by channel Customer segmentation by exposure Bendigo 8% Rural Bank 3% $3,000m $2,500m Rural Finance 28% $2,000m $1,500m $1,000m Elders 61% $500m $0m Less than $100k $100k to $500k $500k to $2m $2m Lending Balance Lending Limit # Clients (RHS) TAS 2% Customer segmentation by state SA 12% WA 18% NT 2% QLD 10% VIC 43% NSW 13% Customer segmentation by tenure 10+ Years 53% Less than 1 Year 6% 1 to 5 Years 22% 5 to 10 Years 19% Customer segmentation by industry Grain 18% Mixed Cropping 25% Beef 15% Dairy 13% Sheep Mixed 9% Livestock 12% Page 11

27 GROW Beef Cropping Dairy Sheep Horticulture RETAIN Cotton Lifestyle Intensive EXPLORE Future farmers Women in ag Risk management Alternative capital structures

28 While our points of representation are aligned with existing agri lending markets, there is scope to expand in line with Community Bank network 114 Relationship Managers 15 regional offices and 20 local relationship locations across the country Regional reach through Elders Rural Services, Community Bank and Bendigo Bank branches nationally Page 13

29 What we need from you? Understanding that Rural is a key contributor to the Group success and brand Leverage the Rural resources AgAnswers insights and knowledge If you have rural and agri friends, family or networks introduce us!

30 Paul Rohan Head of Wealth A super opportunity for your Community Bank

31 Our common challenges Your needs Your customers needs?

32 Home equity v super: What is your customer s most valuable asset? Mean super 1 Mean home equity among home-owner households 2 Average superannuation 3 predicted to surpass average home equity $428K $321K $211K $120K Table 7.4 of the 11 th Annual Statistical Report of The Household, Income and Labour Dynamics in Australia (HILDA) Survey, 2016 (for individuals aged 50-69) 2 Table 6.3 of the 11 th Annual Statistical Report of The Household, Income and Labour Dynamics in Australia (HILDA) Survey, 2016 (for individuals aged 25+) 3 Roger Wilkins, Deputy Director of Research HILDA, Australian Financial Review, July 20 th 2016 Super a bigger asset that housing for most by 2029

33 What super opportunity are you missing out on? Lose revenue Lose relevance Cost of doing nothing Lose customers Protect and leverage the trust you ve built

34 Value proposition for Deloraine Community Bank Branch $32K revenue in 2029 if you had started in 2005 Annual CB Payshare Amount $14K revenue in 2029 if you start today $46, Assumes 12 new members a year, each starting with a $42k super balance, an annual salary of $60K and receiving employer contributions at a rate of 9.5%. The CB Payshare amount has been calculated on 0.10% of the closing super balance for the year. Projections do not take into account investment returns, fees, tax, legislative changes or inflation, and are provided for illustrative purposes only. Years

35 Value proposition for Point Cook Community Bank Branch $362K revenue in 2029 if you had started in 2000 $169,125 Annual CB Payshare Amount $123K revenue in 2029 if you start today $734, Years Assumes 104 new members a year, each starting with a $42k super balance, an annual salary of $60K and receiving employer contributions at a rate of 9.5%. The CB Payshare amount has been calculated on 0.10% of the closing super balance for the year. Projections do not take into account investment returns, fees, tax, legislative changes or inflation, and are provided for illustrative purposes only.

36 Opportunities and conversations When was the last time you thought about your super? Is cost a factor? How is your current super working for you?

37 Bendigo SmartStart Super Low cost Simple investment options A comprehensive range of insurance options Proven track record MySuper authorised CANSTAR, is Australia and New Zealand's most comprehensive specialist research service, and is used by over 325 financial institutions, government, media and finance professionals. The Heron Partnership's superannuation fund rating service covers industry funds, master trusts and multi-employer funds, categorised as either personal or corporate superannuation funds. SuperGuide is Australia's only INDEPENDENT website for consumers on superannuation. Fee comparisons are based on the lowest average fees payable for a $50,000 account balance.

38 Does your Community Bank branch want to miss out on this super opportunity? Tracey Kelly Wealth Engagement Manager Leader

39 This presentation has been provided by Sandhurst Trustees Limited ABN AFSL (Sandhurst) a subsidiary of Bendigo and Adelaide Bank Limited ABN (the Bank). Sandhurst is the issuer Bendigo SmartStart Super ABN The information contained in this presentation is for the use of Community Bank representatives only. Sandhurst takes no responsibility for the use of this information in written and verbal communication with customers. It has been prepared without taking account of any person s objectives, financial situation or needs. Your customers should consider their own situation and read product disclosure statement available at bendigobank.com.au/wealth before making an investment decision. The information in this document is subject to change without notice.

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41 Andrew Cairns CEO, Community Sector Banking

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