2014 FULL YEAR For personal use only RESULTS AUSTRALIA AND NEW - PowerPoint PPT Presentation

FX and divestment impacts FY14 FX and For personal use only Cash Trustees SSI Divestment $m FX 1 Profit 2H14 2H14 Adjusted Growth Growth Revenue 6.5% +336 +125 -21 4.0% Expenses 6.1% +222 -125 1.8% PBP 6.7% +114 - -21 5.8% Provisions -17% +13 - -18% Tax 11% +18 -4 -14 11% NPAT 10% +83 +4 -7 8% 1. Impact of foreign exchange movements 17

The operating environment Very low rates For personal use only Excessive global liquidity Very low market volatility Retail Corporate Solid housing market Environment: Weak confidence Strong savings Low leverage Improving system growth Low credit demand Slow credit growth Medium credit growth Impact: Falling loan margins Strong competition Balance Sheet trading opps. Stable margins Lower hedging demand Low provisions Low provisions Invest Capital efficiency Actions: Grow share responsibly Manage productivity Improve customer experience Diversify revenue 18

Impacts and outcomes – half on half For personal use only 1H14 v 2H13 1 2H14 v 1H14 1 Revenue Expense Revenue Expense Retail 2 2.1% 0.6% 3.9% 1.6% Corporate ex. Markets -1.2% 0.5% 1.7% -1.6% Partnerships 4.9% nm 6.3% nm Total 0.6% 0.5% 3.0% 0.3% Global Markets 21.6% 5.6% -9.1% 0.7% Total Group 3 2.7% 0.2% 1.7% 1.8% 1. FX adjusted (calculated on constant currency) and excluding impact of divestments (Trustees, SSI) 2. Retail includes ANZ‟s Retail & Wealth Business Units 3. Group includes Corporate Centre, not reflected in this table, not material 19

Cash profit – Divisional drivers $m For personal use only 7,117 83 16 7,037 99 230 3 17 217 6,492 8% 9% 10% -4% 8% 10% FY13 Aus. IIB NZ Global GTSO & FY14 Divest- FX FY14 Cash Wealth Group Divisional ments impact Cash Profit Centre Profit 1H14 4% 19% 12% -30% 10% 13% annualised 1 2H14 17% 3% -8% 9% 6% 5% annualised 1 Divestments include Sale of Trustees (within Global Wealth Division) and SSI (within IIB Division) 20

Australia Division – high quality consistent growth Quality Retail growth Quality Commercial growth For personal use only $b $b 88% 87% 87% 88% 87% 2.03 1.97 1.97 1.95 1.91 221 67 213 206 65 65 199 193 63 61 Sep-12 Mar-13 Sep-13 Mar-14 Sep-14 Sep-12 Mar-13 Sep-13 Mar-14 Sep-14 1 NLAs NIM (%) NLAs EAD by CCR (6 or stronger) Improved productivity Operating performance FY 14 growth % $‟000 39.9 430 6% 38.1 410 5% 37.4 37.3 37.0 390 3% 370 350 2H12 1H13 2H13 1H14 2H14 Revenue Expenses PBP CTI (%) Revenue per FTE (RHS) 1. CCR = Customer Credit Rating 21

New Zealand Division – strong productivity dividend Quality Commercial growth For personal use only NZDb NZDb 92% 93% 2.63% 2.61% 2.62% 2.65% 88% 91% 87% 2.52% 59.4 57.3 55.2 53.6 52.7 37.1 36.9 36.4 35.8 35.5 Sep-12 Mar-13 Sep-13 Mar-14 Sep-14 Sep-12 Mar-13 Sep-13 Mar-14 Sep-14 NLAs NIM 1 NLAs EAD by CCR (6 or stronger) Improved productivity Operating performance FY 14 growth % $‟000 6.7% 45.1 300 43.8 280 41.6 41.5 40.8 2.4% 260 240 220 200 -3.2% 2H12 1H13 2H13 1H14 2H14 Revenue Expenses PBP CTI (%) Revenue per FTE (RHS) 1. CCR = Customer Credit Rating 22

Global Wealth – focused on sales and efficiency For personal use only FUM net flows Retail Life lapse rates Wealth customers m Australia  25% $m 1,123 14.5% 14.1% 2.0 13.3% 330 1.6 12.1% 12.5% (288) (491) (617) 2H12 1H13 2H13 1H14 2H14 Sep-13 Sep-14 2H12 1H13 2H13 1H14 2H14 Improved productivity (ex Trustees) Operating performance (ex Trustees) FY 14 growth % $‟000 69.2 11.1% 360 67.0 340 62.7 62.2 61.3 62.0 60.3 320 6.0% 57.0 300 3.0% 52.0 280 47.0 260 2H12 1H13 2H13 1H14 2H14 Revenue Expenses PBP CTI (%) Revenue per FTE (RHS) 23

IIB – Diversification driving profitable growth Revenue Growth FY14 profit by region 1 For personal use only AUDm & FX Adjusted growth rate FX adjusted growth +1% +32% -4% +3% 8% 1,481 7% 6% 3% 922 190 135 -6% Markets Retail Cash Mgt Trade Loans Aus & NZ Asia Pacific US & Europe Cash Profit & Return 2 % $‟000 AUDm 2,727 1000 2,432 2,253 800 46.8 45.1 45.5 600 1.43% 1.46% 1.42% 400 200 0 FY12 FY13 FY14 FY12 FY13 FY14 CTI (%) Revenue per FTE ($'000) RHS NPAT ex SSI/Trustees RoRWA 1. Excluding impact of divestments (Trustees, SSI) 2. RoRWA equals Cash Profit divided by average Basel III risk weighted assets. FY12 Cash Profit has been adjusted to exclude one-off software impairment. 24

IIB – Asia delivering growth with improving returns Strong and balanced customer growth High quality Revenue growth For personal use only USDm Revenue USD growth +8% +11% +9% 28% 800 600 13% 400 9% 5% 200 - Markets Cash Mgt Trade Loans Global Banking International Retail Banking Banking Improving cash profit and return 1,2 USD m % $‟000 800 849 63.7 61.0 56.6 668 600 575 400 1.38% 1.20% 1.19% 200 0 FY12 FY13 FY14 FY12 FY13 FY14 NPAT ex SSI/Trustees RoRWA CTI (%) Revenue per FTE ($'000) RHS 1. RoRWA equals Cash Profit divided by average Basel III risk weighted assets. FY12 Cash Profit has been adjusted to exclude one-off software impairment. 2. excluding impact of divestments (Trustees, SSI) 25

IIB - Markets continuing to grow and diversify Revenue diversity Revenue growth For personal use only FY14 By region $m Asia 29% up FY12 FY13 FY14 $m 9pp in 2 11% 17% 10% 11% 1,400 7% 9% 12% -10% 29% Australia 20% NZ -10% 12% 12% 1,200 Pacific FY12 -10% E+A Asia 1,000 47% 41% 800 Top 5 Asia markets 600 Indexed FY14 Revenue & 2 year growth rates 400 215% 82% 122% 28% 8% 100 200 50 0 0 1H12 2H12 1H13 2H13 1H14 2H14 Singapore Hong Kong China Taiwan Vietnam Sales Income Trading Income Balance Sheet Income 26

Operations and Technology - lower cost, better quality More productive FTE Lower operations cost per FTE For personal use only $000s per FTE Transactions per FTE in international markets 6,077 81 77 5,346 68 4,865 4,469 FY12 FY13 FY14 FY11 FY12 FY13 FY14 Rapidly improving quality Producing operating leverage 865 Manual Payments: Defects Per Million 9% 8% 8% 7% 6% 670 495 400 -3% 180 151 -6% 126 -7% Wealth Australia NZ IIB Operations volumes Operations costs 1H11 1H12 2H12 1H13 2H13 1H14 2H14 27

Strong Group wide expense discipline For personal use only $m 222 8,760 125 8 12 8,413 12 57 67 8,257 FY13 Tech. D&A People Premises Other FY14 Trustee FX FY14 incl (ex D&A) Divisional Proceed impact incentives Invest's. 28

Portfolio credit quality continues to improve Gross Impaired Assets Total Provision Charge For personal use only $b $b 3.06 1.82 1.22 1.26 1.20 0.99 3.5 CP charge IP charge 7.0 2.5 6.56 1.5 6.0 0.5 5.51 5.95 -0.5 5.20 5.0 -1.5 FY09 FY10 FY11 FY12 FY13 FY14 4.26 4.0 Collective provision balance by source 2.89 3.0 $m 2,887 146 2.0 25 2,757 20 49 1.0 232 0.0 Sep-13 Risk Lending Portfolio Mgt FX Sep-14 Sep 09 Sep 10 Sep 11 Sep 12 Sep 13 Sep 14 Gth mix overlay > $100m $10-$99m < $10m 29

Disciplined management of Risk Weighted Asset growth RWA movement For personal use only Total RWA $b - 4 362 362 361 361 4 3 7 339 53 324 11 56 51 300 50 339 280 45 265 31 252 Market & operations risk Market & operations risk 31 22 309 305 288 274 Credit Growth 1 Credit Growth 1 Credit Other 2 Credit Other 2 255 249 234 230 Sep 09 Sep 10 Sep 11 Sep 12 Sep 13 Sep 13 Mar 14 Sep 14 Sep Mar Sep Basel 2 Basel 3 13 14 14 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 30

Capital-strong organic generation For personal use only % 12.7 1.00 0.15 0.05 8.79 0.11 8.48 8.32 0.52 APRA CET1 movement +47bp Sep-13 Mar 14 Cash RWA Capital Div. Other Sep 14 Sep-14 NPAT 1 Usage 2 Deductions 3 Internationally Comparable 1.Cash earnings net of preference share dividends. 2.Includes impact of expected loss versus eligible provision shortfall. 3.Represents the movement in retained earnings in deconsolidated entities, capitalised software and other intangibles 31

SUPER REGIONAL STRATEGY For personal use only STRONG CORE PROFITABLE ENTERPRISE MARKETS ASIAN GROWTH APPROACH STRONG LIQUIDITY AND CAPITAL MANAGEMENT DISCIPLINED AND EXPERIENCED MANAGEMENT 32

ANZ strategy delivering growth and returns For personal use only 5 YEAR CAGR ANZ Peer 1 Peer 2 Peer 3 Revenue 7.0% 5.1% 2.2% 3.5% Expenses 7.2% 2.9% 6.1% 4.0% PBP 6.9% 6.9% (1.4%) 3.2% Provisions (19.9%) (22.4%) (25.5%) (25.3%) Cash NPAT 16.0% 14.9% 6.0% 10.2% EPS 9.1% 12.7% 2.1% 8.4% ROE +340bp +290bp -220bp +510bp ANZ analysis based on latest available company financial information or consensus data 33

2014 FULL YEAR For personal use only RESULTS AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED 31 October 2014 Shayne Elliott Chief Financial Officer Additional Information

Performance versus targets Target FY14 1 For personal use only FY14 Revenue Growth 4%-5% 4.0% Expense Growth 2% 1.8% FY16 15.4% ROE 16%+ & improving 44.3% CTI <43% & improving 8.8% Capital (CET1) “High 8‟s” & improving 1. FX adjusted (calculated on constant currency) and excluding impact of divestments (Trustees, SSI) 35

Cash profit 2014 Full Year Cash Profit For personal use only $m 267 7,117 83 591 7,037 221 3 6,492 Divisional Growth 8% Reported Growth 10% FY13 Cash Divisional Provisions Tax FY14 Divest- FX FY14 Cash NPAT Earnings ments impact NPAT Divestments include Sale of Trustees (within Global Wealth Division) and SSI (within IIB Division) 36

First half NIM 1H14 Group Net Interest Margin movement For personal use only bp 2.2 218.8 0.2 1.1 0.2 214.5 5.4 0.4 -4.3bps 2H13 Funding & Funding Deposits Assets Markets & Other 1H14 Asset Mix Cost Treasury 37

Second half NIM 2H14 Group Net Interest Margin movement For personal use only bp 4.5 1.4 214.5 212.0 0.2 0.7 5.8 2.1 -2.5bps 1H14 Funding & Funding Deposits Assets Markets & Other 2H14 Asset Mix Cost Treasury 38

Revenue by Divisions 2014 Full Year Revenue by Division For personal use only $m 19,578 336 104 68 19,138 58 266 13 368 18,391 Divisional Growth 4% Reported Growth 6% FY13 Aus. IIB NZ Global GTSO & FY14 Divest- FX FY14 Revenue Wealth Group Divisional ments impact Revenue Centre 39

Other Operating Income $m For personal use only 153 2,904 25 2,877 - 104 34 2 22 2,763 154 2H13 Wealth Global Trustees, Other 1H14 Wealth Global Trustees, Other 2H14 Markets SSI Markets SSI 40

Global Wealth Reconciliation of Reported Numbers For personal use only Core business performance 63 525 8 30 471 475 31 20 1 429 14 33 50 +11% FY13 FX FY13 FY13 Insurance Funds Private Other FY14 Core Group life Insurance Trustees FY14 Cash impact Tax ex fx & Growth Mgmt Wealth Business plan exit settlement sale Cash Profit consol. tax impact growth growth Profit 1. Includes a non-recurring insurance settlement net gain of $20m after tax 41

2014 FULL YEAR For personal use only RESULTS AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED 31 October 2014 Treasury

ANZ is well capitalised Capital Update Basel 3 Common Equity Tier 1 (CET1) For personal use only • 12.7% 12.7% Strong organic capital generation in 2H14 of 84bps. 12.2% Growth in CET1 of 47bps in 2H14 to 8.8% largely reflects an ongoing focus on capital efficiency 8.8% 8.5% • 8.3% 1% CET1 D-SIB capital build largely complete (D-SIB implementation in January 2016) • Internationally Comparable 1 CET1 ratio is ~3.9% higher than under APRA basis. Reflects variances between Basel III under APRA and Basel standards • Dividend payout to remain towards upper end of 65- 70% range. Consistent with 1H14, no DRP neutralisation or discount will apply Sep 13 Mar 14 Sep 14 1 APRA Internationally Comparable APRA CET1 Capital Reconciliation Under Basel 3 Movement Sep 2014 v Mar 2014 1.00 Total % CET1 Tier 1 8.79 Capital 0.15 0.11 8.32 0.05 APRA 8.8% 10.7% 12.7% 0.52 10%/15% allowance for equity 1.0% 0.9% 0.9% investments and DTA Mortgage 20% LGD floor 0.4% 0.5% 0.5% IRRBB RWA (APRA Pillar 1 approach) 0.4% 0.4% 0.5% Specialised Lending (Advanced 0.4% 0.4% 0.5% treatment) Corporate undrawn EAD and unsecured 1.5% 1.8% 2.1% LGD adjustments Mar 14 Cash RWA Capital Dividends Other Sep 14 Other items 3 4 0.2% 0.3% 0.3% 2 NPAT Usage Deductions Internationally Comparable 12.7% 15.0% 17.5% 1. Methodology per Australian Bankers’ Association: International comparability of capital ratios of Australia’s major banks (August 2014). Prior year comparatives have been restated based on current methdology; 2. Cash earnings net of preference share dividends; 3. Includes impact of expected loss versus eligible provision shortfall; 4. Represents the movement in retained earnings in deconsolidated entities, 43 capitalised software and other intangibles.

ANZ‟s CET1 ratio compares favourably to global peers on an Internationally Comparable basis at 12.7% Australia Canada 3 UK 3 For personal use only 12.7% 12.7% 11.5% CCB & D-SIB 11.3% 10.9% 10.7% effective 1 Jan 2016 10.1% 9.9% 9.5% 9.6% 9.3% 8.8% 8.0% 1.0% D-SIB 2.5% CCB 4.5% CET1 2 1 2 APRA APRA FY14 (Internationally (Canada Bank of Nova Royal Bank of Bank of Montreal Toronto-Dominion (UK basis) HSBC Barclays RBS Chartered Standard Min basis) Comparable) ANZ Canada ANZ ANZ Scotia ANZ 1. Methodology per Australian Bankers’ Association: International comparability of capital ratios of Australia’s major banks (August 2014) 2. ANZ estimates 3. Peer data per most recent Capital Adequacy and Risk Management (Pillar 3) disclosures 44

Regulatory capital generation For personal use only 3 year average FY11-14 bps of CET1 pa 1 Capital generation Cash profit 198 Capital utilisation RWA growth (44) Average 6% pa FY11-14 Capital deductions (23) Primarily earnings retained in non-consolidated subsidiaries Net dividends (105) • Target payout 65-70% of cash profit • Average DRP participation ~20% with no discount, or ~40% with 1.5% discount. 1.5% discount would have added ~28bps to CET1 ratio pa on average over this period. Other 18 Net CET1 ratio movement 44 1. Basel III basis 45

Common Equity Tier 1 generation and dividend payments APRA Basel III CET1 Ratio For personal use only 9.0% 8.8% 8.5% 8.3% 8.0% 7.8% 7.5% Sep-12 Dec-12 Mar-13 Jun-13 Sep-13 Dec-13 Mar-14 Jun-14 Sep-14 Note: shaded quarters represent declaration of dividends. Basel III basis. • Under Basel III (from January 2013), 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 46

Stable balance sheet composition 120% Funding mix Asset tenor mix For personal use only 29% 18% 17% 16% 25% 26% 100% 7% 13% 14% 14% 15% 8% 22% 1% 3% 3% 8% 8% 80% 4% 12% 4% 12% 7% 14% 60% 80% 40% 63% 62% 72% 71% 50% 20% 8% 8% 7% 4% 3% 3% 0% Sep 08 Sep 13 Sep 14 Sep 08 Sep 13 Sep 14 ST Wholesale Funding Term Debt < 1yr Liquid Assets Other ST Assets Term Debt > 1yr Customer Funding Trade Loans Lending SHE & Hybrid Debt Other Fixed Assets 47

Term wholesale funding portfolio – consistent and well diversified Term Funding Profile For personal use only $b Issuance Maturities Annual 26 24 24 indicative 23 24 issuance volume 20 18 16 13 13 12 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20+ Senior Unsecured Covered Bonds Tier 2 Portfolio by Type Portfolio by Currency 1% 6% 9% 8% Domestic 7% 8% 9% (AUD/NZD) 18% Government 18% 13% North America Guaranteed (USD, CAD) Tier 2 21% 35% UK & Europe ( € ,£,CHF) Covered 74% 69% 68% Bonds Asia (JPY, HKD, Senior SGD, CNY) Unsecured 36% Other Sep 12 Sep 13 Sep 14 Note: All figures based on historical FX; and excludes hybrids. Includes transactions with a call or maturity date greater than 12 months as at 30 September 2014 in the respective year of issuance 48

Liquidity – well positioned ahead of LCR implementation Liquid Assets 1 Liquidity Update For personal use only $b • As a result of a shortage of HQLA including government bonds in Australia, APRA will 140 allow banks to meet some of their Basel III Liquidity Coverage Ratio (LCR) 122 requirement via a Committed Liquidity Facility (CLF) 49 • The CLF is operated by the Reserve Bank 39 of Australia and provides banks with access to a pre-specified amount of 18 liquidity accessible via repo agreements 16 • ANZ has completed preparation for the implementation of the LCR from 1 January 115 2015 including holding assets required as part of CLF 39 73 • Liquid assets comfortably exceed 9 67 wholesale funding maturities over the next 17 twelve months. 13 Sep 08 Sep 13 Sep 14 Sep 14 Wholesale funding <12 Internal RMBS mths to maturity Private Sector Securities & Precious Metals Cash, Government & Semi-Government Securities 1. Post RBA haircut 49

Foreign currency hedging – earnings benefit from lower AUD FY14 Earnings Composition Earnings per Share FX Impact For personal use only (by currency) 1.4% AUD 59% Other IDR 19% -0.3% FY14 v FY13 2H14 v 1H14 NZD 22% Translation Rates (inclusive of hedges) • The key objective of hedging is to manage short term EPS volatility arising from foreign currency earnings 1.35 1.04 • 1.02 Hedges currently in place: 1.30 1.00 • FY15: ~70% of NZD and ~55% of USD (incl. 1.25 0.98 USD correlated) earnings 0.96 • 1.20 FY16: ~20% of expected foreign earnings 0.94 • At 30 September 2014 FX rates, the expected impact of 1.15 0.92 FX movements on FY15 earnings (inclusive of hedges) is positive ~1.2% EPS 1.10 0.90 FY11 FY12 FY13 FY14 • Hedging has reduced the impact of a 5% movement of the AUD to less than 1% for FY15 EPS. NZD Translation (LHS) USD Translation (RHS) 50

FX Sensitivity – illustrating the impact of FX Full Year For personal use only Metric impact of 5% Comments fall in AUD 1 Income statement ~+$250m or • Impact from translation of foreign currency revenue, offset by the Revenue ~+1.3%% impact of hedging losses ~+$175m or • Operating expenses Impact from translation of foreign currency expenses ~+2.0% ~+$70m or • Cash profit The net result of the above ~+0.9% • Mix impact due to a higher relative contribution from lower risk and Net interest margin ~-0.5bp lower margin Asian lending • The impact on FX revenue and expenses largely offset each other. Cost to income ratio +30bps However, losses on the hedges of profit are booked against income, adversely impacting CTI Balance sheet • CP overlays in AUD whereas a proportion of CRWA is denominated in foreign currencies CP/ CRWA ~-0.5bps • Further impact from higher CRWA on FX derivatives with no corresponding CP (derivatives are marked-to-market and attract CVA) • Funding flows from ~$2 to $3bn Collateral flows under cross currency swaps used to hedge existing cross currency swaps inflow offshore funding liabilities. • Mix impact from geographies that currently have lower ROEs. • Timing impact from mismatch between FCTR change and foreign Return on equity -20bps earnings which are substantially hedged near-term. • Little or no impact to capital ratio. 1. Impact from a lower AUD relative to foreign currencies including impact of hedges 51

Capital and replicating portfolio – low interest rates no longer a headwind Australia New Zealand For personal use only 2H14: ~$170m portfolio earnings benefit 2H14: ~A$25m portfolio earnings benefit relative to the average RBNZ cash rate relative to the average RBA cash rate 6% 6% 5% 5% 4% 4% 3% 3% 2% 2% 1% 1% 0% 0% 1H11 2H11 1H12 2H12 1H13 2H13 1H14 2H14 1H11 2H11 1H12 2H12 1H13 2H13 1H14 2H14 ANZ Australia Portfolio Earnings Rate ANZ New Zealand Portfolio Earnings Rate Average RBA Cash Rate Average RBNZ Cash Rate 52

2014 FULL YEAR For personal use only RESULTS AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED 31 October 2014 Risk Management

Benign conditions & disciplined management actions drove result Credit quality Provision charge For personal use only Individual Provision (IP) Charge (LHS) $m Collective Provision (CP) Charge (LHS) Gross impaired assets  32% Total Provision Charge as % Avg. Net Advances 3,500 $2,889m FY14 CIC $989m 2,500 FY14 IPC $1,144m 0.85% FY14 CPC -$155m 1,500 0.30% Credit impairment charge 0.26% 0.50% 0.19%  17% 500 0.32% $989m -500 FY09 FY10 FY11 FY12 FY13 FY14 Total risk weighted assets  7% Impaired assets $362b $m Gross Impaired Assets New Impaired Assets 7,000 Avg. $918m decline YoY Credit exposure (EAD) 6,000  10% $813b 1 5,000 4,000 3,000 2,000 CP coverage ratio 89bps 1,000 (CP/CRWA) 0 1. Total Post-Credit Risk Methdology EAD without any exclusions 54

Portfolio quality improvement reflected in a lower CP balance Significant portfolio quality improvement CP coverage reflective of portfolio risk For personal use only evidenced by CP movement drivers $b Credit Risk Weighted Assets • Credit quality improvement saw a collective Collective Provision as a % of CRWA provision reduction of $232m due to risk 1.36% 1.28% profile, while lending growth added $146m 1.20% 1.08% 1.00% 1.00% 0.93% 0.89% • $49m of management overlay was released in FY14, no longer required due to improved credit and markets conditions, and continued 305 309 288 276 255 249 250 strength of the NZ economy 233 Mar 11 Sep 11 Mar 12 Sep 12 Mar 13 Sep 13 Mar 14 Sep 14 Collective provision by division Collective provision by source $m $m 2,887 32 2,887 146 2,757 25 75 20 2,757 25 49 71 41 232 Sep 13 AUS IIB NZ Weath & FX Sep 14 Sep 13 Risk Lending Portfolio Mgmt. Fx Sep 14 Growth Mix Overlay movement Other Movement 55

Modelled loss rates continue to decline Group regulatory expected loss For personal use only • Regulatory Expected Loss is a one-year bps % downturn loss measure as prescribed by EAD APRA and reported in the Results  34bps Announcement • Includes conservative overlays that are not reflective of an „expected‟ outcome, such as: • Already expensed Individual Provisions • Assumes stressed asset valuations • Places a minimum 20% LGD (Loss Given Default) on the Australian mortgage 7 portfolio 89 • The Sep 14 figure of 55bps includes 83 additional individual provisions for partial 69 67 write offs that are not included in the prior 57 period figures. This reflects a change in RWA 48 calculation methodology in Sep 13. The result is that the Sep 14 Regulatory Expected Loss figure is inflated by 7bps • On a like-for-like basis, the Sep 14 Regulatory Expected Loss figure of 48bps reflects continued improvement of portfolio Sep 09 Sep 10 Sep 11 Sep 12 Sep 13 Sep 14 quality 56

Reduction observed in historical loss rates Historical observed loss rates Historical rate of impaireds 2 For personal use only bps bps 1 Adjusted IP Loss Rate for Current 250 1000 Portfolio Mix IP Loss Rate 900 IA/NLA (bps) 200 800 1990-2014 lowest bp loss rate 700 150 600 500 100 400 300 50 200 8bps 100 0 0 Sep Sep Sep Sep Sep Sep Sep Sep Sep Sep Sep Sep Sep Sep Sep Sep Sep Sep Sep Sep Sep Sep Sep Sep Sep Sep 90 92 94 96 98 00 02 04 06 08 10 12 14 90 92 94 96 98 00 02 04 06 08 10 12 14 Looking back, projecting forward • Study of long-run historical loss rate trends can provide insights on potential future trends, including cycle durations, cyclical maximum and minimum divergence and loss “norms” experienced during periods of stability and growth • The current portfolio exposures have less tail-risk than observed in the early 1990s • Current IP loss rate is similar to that observed in the early 2000s 1. Adjusted loss rate is based on applying the current portfolio mix to prior period loss rates 2. Rate of Impaireds = Impaired Assets / Net Lending Assets 57

New/increased IPs and writebacks /recoveries have been consistent Individual provision charge by segment Individual provision charge composition For personal use only Institutional Commercial Consumer New Increased Writebacks & Recoveries $m $m 2,815 3,000 3,000 1,823 2,815 1,637 2,500 1,213 1,167 1,144 2,000 1,500 2,500 1,000 IP Loss Rate  58bps 500 0 -500 2,000 1,823 -1,000 FY09 FY10 FY11 FY12 FY13 FY14 1,637 1,500 Individual provision charge by region 1,213 1,167 1,144 $m Australia New Zealand APEA 2,815 3,000 1,000 2,500 1,823 2,000 1,637 500 1,500 1,167 1,144 1,213 1,000 500 0 0 FY09 FY10 FY11 FY12 FY13 FY14 FY09 FY10 FY11 FY12 FY13 FY14 58

Control list customer numbers down 30% YoY, limits down 27% Global Institutional investment grade Control list exposures For personal use only Index Sep 09 = 100 Control List by Limits 78% 78% Control List by No of Groups 120 100 80 75% 60 73% 40 20 Sep 09 Sep 10 Sep 11 Sep 12 Sep 13 Sep 14 Global Institutional sub-investment 68% grade 1 exposures BB+ to BB BB- <BB- 66% 8% 8% 5% 5% 4% 4% 3% 3% 4% 3% 3% 3% 21% 20% 18% 18% 16% 16% Sep 09 Sep 10 Sep 11 Sep 12 Sep 13 Sep 14 Sep 09 Sep 10 Sep 11 Sep 12 Sep 13 Sep 14 1. Sub-investment grade defined as exposures with a rating below BBB- 59

Gross impaired assets reduced by 32% ($1,375m) YoY Gross impaired assets by type Gross impaired assets by size of exposure For personal use only 1 $m $m Impaired Loans NPCCD Restructured > $100m $10-$99m < $10m 7,000 7,000 6,561 6,561 6,000 6,000 5,595 5,595 5,581 5,581 5,196 5,196 5,000 5,000 4,264 4,264 4,000 4,000 2,889 2,889 3,000 3,000 2,000 2,000 1,000 1,000 0 0 Sep 09 Sep 10 Sep 11 Sep 12 Sep 13 Sep 14 Sep 09 Sep 10 Sep 11 Sep 12 Sep 13 Sep 14 1. NPCCD - Non-Performing Commitments, Contingents & Derivatives 60

Asset quality improvement is broad-based Impaired assets concentration Net impaired assets by division by number of customers 1 For personal use only $m Australia New Zealand IIB Other $10-50m $51-100m $101-200m >$200m 3% 0% 12% 4% 4% 3% 4% 10% 4,685 1% 3% 5,000 4,069 9% 11% 3,884 11% 19% 20% 20% 4,000 3,423 19% 2,797 3,000 1,713 88% 82% 2,000 77% 72% 70% 58% 1,000 0 Sep 09 Sep 10 Sep 11 Sep 12 Sep 13 Sep 14 Sep 09 Sep 10 Sep 11 Sep 12 Sep 13 Sep 14 Impaired assets concentration New impaired assets by division by value of impaired assets 1 Australia New Zealand IIB Other $m $10-50m $51-100m $101-200m >$200m 6,575 7,000 6,000 5,446 24% 26% 27% 31% 34% 5,000 4,265 4,203 55% 5% 16% 18% 4,000 11% 3,287 2,868 31% 18% 30% 3,000 29% 16% 2,000 56% 16% 42% 37% 1,000 36% 29% 13% 0 0 Sep 09 Sep 10 Sep 11 Sep 12 Sep 13 Sep 14 Sep 09 Sep 10 Sep 11 Sep 12 Sep 13 Sep 14 1. Only >$10m customers 61

Disciplined Risk Weighted Assets growth Total risk weighted assets Total risk weighted assets For personal use only movement Sep 2014 v Sep 2013 $b $b Market & Operational Risk Weighted Assets 3 362 21 Credit Risk Weighted Assets 1 362 339 339 53 324 1 Sep-13 Credit Market & Operational Sep-14 51 300 IRRBB 50 Total risk weighted assets 280 movement by division Sep 2014 v Sep 2013 45 264 31 252 $b 16.5 362 31 22 0.3 309 288 274 4.5 255 249 2.0 234 230 339 Sep 09 Sep 10 Sep 11 Sep 12 Sep 13 Sep 13 Sep 14 Basel 2 Basel 3 Sep 13 AUS NZ IIB Other Sep 14 1. Predominately portfolio growth (see next slide) 62

Credit risk discipline reflected in CRWA growth Group exposure at default Credit risk weighted assets For personal use only and credit risk weighted assets movement Sep 2014 v Sep 2013 Exposure at Default ($b) $b 308.9 Credit Risk Weighted Assets ($b) 4.4 17.3 1.9 CRWA / EAD (%) - Basel II EAD CRWA / EAD (%) - Basel III CAGR  10% 287.7 813 2.4 741 Sep 13 Risk Growth Portfolio FX Sep 14 658 Data Impact 615 Review 45% 550 Credit risk weighted assets 42% 39% 511 40% movement by division Sep 2014 v Sep 2013 38% 39% 37% $b CRWA 1 308.9 CAGR 0.2 4.0  6% 13.3 309 288 255 249 1.3 234 230 287.7 Sep 13 AUS IIB NZ Other Sep 14 Sep 09 Sep 10 Sep 11 Sep 12 Sep 13 Sep 14 1. Adjusted for the Basel II to Basel III step change in Sep 13 figures of approx. $14bn 63

Considered management of exposure to market stress Risk weighted asset and VaR outcomes For personal use only • Traded Market Risk VaR usage remained moderate • Traded Market Risk 1-day 99% VaR and RWA increased YoY but we have remained disciplined on our exposure to market disruption and stress as reflected in RWA • VaR benefits from diversification across the region and asset classes, relative to Traded Market Risk RWA which reflects 10 day stress VaR Traded market risk weighted asset trends IRRBB risk weighted asset trends $billion $billion $million 25 Traded Market 10 50 Risk RWA IRRBB RWA 20 Traded Market 40 8 Risk 1-day VaR (RHS) 15 30 5 10 20 3 5 10 0 0 0 Sep-10 Sep-11 Sep-12 Sep-13 Sep-14 Sep-10 Sep-11 Sep-12 Sep-13 Sep-14 64

Stable portfolio composition Exposure at default (EAD) % in non- For personal use only Category EAD as a % of Group total performing ANZ Group Sep-13 Sep-14 Sep-13 Sep-14 Total EAD (Sep 14) 1 Consumer Lending 40.8% 39.5% 0.2% 0.2% $796b Finance, Investment & Insurance 15.9% 17.6% 0.1% 0.0% Property Services 7.1% 6.9% 1.1% 1.3% 2% Manufacturing 6.0% 6.3% 0.7% 0.5% 5% 2% 2% 2% 2% Agriculture, Forestry, Fishing 4.3% 3.9% 4.1% 2.5% 3% 4.0% 4.0% 0.0% 0.0% Government & Official Institutions 4% 40% Wholesale trade 3.9% 4.0% 0.8% 0.5% 4% 4% Retail Trade 2.9% 2.7% 0.9% 0.5% Transport & Storage 2.2% 2.3% 1.6% 2.1% 6% 7% Business Services 2.0% 1.9% 0.5% 1.2% 18% Resources (Mining) 1.9% 2.2% 1.2% 0.8% Electricity, Gas & Water Supply 1.7% 1.6% 0.1% 0.1% Construction 1.7% 1.7% 1.1% 1.8% Other 5.7% 5.5% 0.9% 0.4% 1. EAD excludes amounts for „Securitisation‟ and „Other Assets‟ Basel asset classes 65

Quality of Institutional book remains sound Institutional investment grade exposure Trade Finance investment grade exposure For personal use only by geography 31% 32% 33% 33% 36% 13% 23% 26% 87% 69% 68% 67% 67% 77% 74% 64% Asia Australia New Zealand Sep 10 Sep 11 Sep 12 Sep 13 Sep 14 Investment Grade Sub-Investment Grade Investment Grade Sub-Investment Grade Robust control framework in Trade Finance • Trade Finance portfolio performed well. The portfolio remains focussed on shorter tenor exposures, and investment grade customers • We reviewed our Trade terms and conditions in 2013. ANZ is not exposed to the Qingdao commodity finance fraud • ANZ has been proactive in mitigating our exposure to commodity trade finance and higher risk counterparties • We have suffered some performance bonds related losses specific to the mining services sector 66

Resources exposure focused on Oil & Gas Resources exposure credit quality by Resources exposure by sector (% EAD) geography (EAD) For personal use only Resources ASIA ($b) EA & Other AUS ($b) NZ ($b) ($b) Total EAD (Sep 14) As a % of Group EAD 8.9 0.8 3.8 4.1 $17.6b 2.2% 10% 24% 27% 54% 6% 90% 17% 76% 73% 46% AUS NZ ASIA OTHER Investment Grade Sub-Investment Grade 23% (includes Resources exposure growth trends 39% Iron Ore 10%) 40% 30% 15% 20% 10% Oil & Gas Coal 0% Metal Ore Mining Services Coal Mining Metal Ore Oil & Gas Other Services To Mining Extraction Mining Mining Other 1H12 FY12 1H13 FY13 1H14 FY14 67

Agri portfolio is focused on cashflow resilient commodities New Zealand Agri credit quality Agriculture exposure by sector (% EAD) For personal use only focused on cashflow NZD Total Credit Exposure (LHS) Agriculture Average PD (Non-Defaulted Customers) (RHS) Total EAD (Sep 14) As a % of Group EAD NZ$b 25 2.5% $31.3b 3.9% 21 19 Dairy 20 2.0% 18 18 17 14% 2.1% Beef 15 1.5% 1.2% 10% 1.6% 0.9% Sheep & Other Livestock 10 1.0% 39% 0.8% 17% Grain/Wheat 5 0.5% Horticulture/Fruit/other 11% 0 0.0% Crops 9% Sep 10 Sep 11 Sep 12 Sep 13 Sep 14 Forestry & Fishing/Agriculture Services Group Agriculture EAD splits 1 1% 7% 3% 5% 40% 17% 59% 71% 97% <60% Secured 60 - < 80% Secured Australia New Zealand Productive Impaired 80 - < 100% Secured Fully Secured Int Markets 1. Using extended values 68

Commercial property portfolio lower than peers Commercial Property outstandings by Commercial Property outstandings by For personal use only region sector APEA (LHS) New Zealand (LHS) Offices Australia (LHS) % of Group GLA's (RHS) 28% $B Retail 40.0 8.0% Residential 30% Industrial 35.0 22% 7.5% Tourism 3% 4.3 30.0 Other 4.1 3% 3.5 14% 3.0 1.1 7.0% 7.0 1.0 25.0 6.1 Property services peer comparison 5.9 5.3 5.0 5.2 20.0 6.5% $M ANZ Peer 1 Peer 2 Peer 3 Commercial Property 49,838 69,257 68,033 57,359 Portfolio EAD 15.0 6.0% Commercial Property 9.3% -1.5% 11.1% 6.7% 22.7 EAD Growth Rates 22.1 21.8 21.3 20.8 10.0 19.9 Property EAD/Total EAD 5.93% 7.92% 8.31% 6.74% 5.5% 5.0 Impaired Assets 528 2,410 942 373 Property Impaired 1.06% 3.48% 1.38% 0.65% 0.0 5.0% Assets /Property EAD FY09 FY10 FY11 FY12 FY13 JUN'14 69

Australia Division displays a stable delinquency profile Australia Home Loans 90+ day Australia Division credit exposure (EAD) For personal use only delinquencies by state 1 Sep 14 2 Sep 11 Sep 12 Sep 13 1.0% Home Loans 0.8% Corporate & 24% Commercial 0.6% Consumer Cards 0.4% 6% Personal Loans 1% 68% 0.2% 1% Other 0.0% VIC NSW QLD WA Portfolio & ACT Australia Division 90+ day delinquencies 1 Australia Home Loans portfolio by state 3 2 Home Loans (inclusive of hardship change) VIC NSW & ACT QLD WA Other Consumer Cards Corporate & Commercial Banking 3.0% Sep-14 29.3% 26.4% 18.0% 16.5% 9.8% 2.0% 1.39% 1.0% 1.02% Sep-13 29.0% 26.2% 18.3% 16.5% 10.0% 0.48% 0.0% 0% 25% 50% 75% 100% Sep-10 Sep-11 Sep-12 Sep-13 Sep-14 1. Delinquency excludes Non Performing Loans 2. Hardship changes implemented April‟13. For comparison: 90+ excluding hardship changes as at Sep‟14 is 0.40% 3. Gross loans and advances by State 70

Australia Home Loans portfolio FY14 portfolio statistics 1 Dynamic loan to value ratio 5 For personal use only % of Portfolio Total Number of Home Loan Accounts 919k 50% 45% Total Home Loans FUM $209b 40% 35% 30% % of Total Australia Geography Lending 60% 25% 20% % of Total Group Lending 40% LVR >90% 3.7% 15% (Sep‟14) 9 10% Owner Occupied Loans - % of Portfolio 2 61% 5% 0% Average Loan Size at Origination $352k 0-60% 61-75% 76-80% 81-90% 91-95% 95%+ (FY14 average) 3,4 Mar-12 Sep-12 Mar-13 Sep-13 Mar-14 Sep-14 Average LVR at Origination (FY14) 3,4,5 71% Individual provision as % of average NLA Average Dynamic LVR of Portfolio 4,5,6 50% FY11 FY12 FY13 FY14 % of Portfolio Ahead on Repayments 7,8 45% Group 0.32 0.38 0.25 0.22 % of Portfolio Paying Interest Only 8 34% Australia Home Loans 0.02 0.02 0.02 0.01 1. Net Home Loans (excluding NPLs and offset balances); 2. Excludes Equity Manager; 3. Originated FY14; 4. Unweighted ; 5. Including capitalised premiums ; 6. Valuations updated Sep‟14 where available; 7. % of customers >30 days ahead of repayments; 8. Excl udes revolving credit; 9. Excluding capitalised premiums, Sep14 portfolio % with LVR >90% is 2.3% (Mar14 2.3%) 71

Stable LMI loss rates below industry average Australian Home Loan portfolio LMI and Background Reinsurance Structure at 30 September 2014 For personal use only Financial Year 2014 Results % FUM LVR ≤ 80% Not Insured Gross Written Premium ($m) $209m 79% 2014 Reinsurance Net Claims Paid ($m) $10m Arrangement LVR > 90% 10% LVR 80% to 90% 11% LMI Insured LMI Insured Loss Rate (of Exposure) 5.4 bps Quota Share 2 Arrangement (LVR > 90%) Aggregate Stop Loss 3 ANZLMI maintains low loss ratios 1 Arrangement on Net Risk Retained (LVR > 80%) Industry ANZ LMI Insurer 1 Insurer 2 Insurer 3 150% ANZLMI uses a diversified panel of reinsurers (10+) comprising a mix of APRA authorised 100% reinsurers and reinsurers with highly rated security Reinsurance is comprised of a Quota Share 50% arrangement with reinsurers for mortgages 90% LVR and above and in addition an Aggregate Stop 0% Loss arrangement for policies over 80% LVR -50% FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 1. Negative Loss ratios are the result of reductions in outstanding claims provisions. Source: APRA general insurance statistics (loss ratio net of reinsurance) 2. Quota Share arrangement - reinsurer assumes an agreed reinsured % whereby reinsurer shares all premiums and losses accordingly with ANZLMI 3. Aggregate Stop Loss arrangement – reinsurer indemnifies ANZLMI for an aggregate (or cumulative) amount of losses in excess of a specified aggregate 72 amount. When the sum of the losses exceeds the pre-agreed amount, the reinsurer will be liable to pay the excess up to a pre-agreed upper limit.

New Zealand mortgages portfolio Dynamic loan to valuation ratio FY14 portfolio statistics For personal use only Total Number of Mortgage Accounts 488k 7% Total Mortgage FUM (NZD) $62b 10% 0-60% % of Total New Zealand Lending 58% 61-70% 48% 71-80% 18% % of Total Group Lending 1 11% 81-90% Owner Occupied Loans - % of Portfolio 76% 90%+ 17% Average Loan Size at Origination (NZD) $266k Average LVR at Origination 2 63% Mortgage portfolio by region Average Dynamic LVR of Portfolio 3 50% Auckland % of Portfolio Paying Interest Only 4 22% 3% 12% Wellington Individual provision as % of average NLA 39% Christchurch FY11 FY12 FY13 FY14 27% North Island Group 1 0.32 0.38 0.25 0.22 South Island 7% 12% New Zealand Mortgages 5 0.11 0.07 0.04 0.06 Other 1. As % of group average NLA; 2. Average LVR at Origination (not weighted by balance); 3. Average dynamic LVR as at Aug 2014 (not weighted by balance) – Dynamic LVR graph as at Aug 2014; 4. Excludes revolving credit facilities; 5. Individual Provision as % average NLA 73

New Zealand credit quality continues to improve New Zealand geography New Zealand geography For personal use only net impaired assets total provision charge NZDm NZDm IP Charge CP Charge Net Impaired Assets NIA as % GLA 200 105 1,685 85 103 150 99 100 44 30 22 50 -39 0 1,307 -50 1,169 -100 1H11 2H11 1H12 2H12 1H13 2H13 1H14 2H14 991 1.74% 883 New Zealand Division 90+ days delinquencies 1.38% 662 2.0% 1 1.23% Home Loans Commercial Agri 594 1.6% 1.02% 483 0.89% 1.2% 0.8% 0.66% 0.58% 0.46% 0.4% 0.0% Sep-07 Sep-08 Sep-09 Sep-10 Sep-11 Sep-12 Sep-13 Sep-14 Mar-11 Sep-11 Mar-12 Sep-12 Mar-13 Sep-13 Mar-14 Sep-14 1. Spikes in 2012 Commercial 90 day delinquencies are primarily due to internal classifications rather than any deterioration in underlying credit quality 74

2014 FULL YEAR For personal use only RESULTS AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED 31 October 2014 ANZ Overview

ANZ offers a distinctive geographic footprint and business mix that provides earnings diversification Corporate Profile For personal use only • Founded in 1835, ANZ is a super regional bank that serves 10 million retail, commercial and institutional customers in 33 markets and employs 50,000 staff. • Headquartered in Melbourne, Australia, ANZ is one of the four largest Australian banks and ranked in the top 25 banks globally by market capitalisation. • Listed on the Australian Stock Exchange (ASX) with a secondary listing on the New Zealand Stock Exchange (NZX) Top 4 Corporate A Top 4 Bank The Largest Bank in Bank in Asia 1 in Australia 2 New Zealand APEA Australia New Zealand Staff 20,512 Staff 21,591 Staff 8,225 Customers ~1.6m Customers ~6m Customers ~2.1m Cash NPAT $1.2B Cash NPAT $4.4B Cash NPAT $1.5B RoRWA 1.30% RoRWA 2.16% RoRWA 2.51% Customer Deposits $108B Customer Deposits $228B Customer Deposits $68B Customer Lending $79B Customer Lending $349B Customer Lending $94B 1. Greenwich Associates 2013 Asian Large Corporate Banking Study 2. Peter Lee Associates Large Corporate and Institutional Relationship Banking surveys, Australia and New Zealand 2014 76

ANZ Operating Structure Operating Divisions FY14 Operating Income Mix by Division For personal use only Australia Division • Retail Banking • Corporate & Commercial Banking Transaction Retail Asia Banking Pacific Global Asia Partnerships Loans 9% 4% 2% Other New Zealand Division 0% New Zealand 9% 6% Retail • Retail Banking IIB New New Zealand • Commercial & Agri Banking Global 7% Commercial Zealand 36% Markets 12% 13% Funds 3% Management Global Wealth International & Institutional Banking (IIB) 3% 9% Insurance 2% Private Wealth Global Products Australia Client Segments 1% Other • Transaction Banking • Global Banking 42% 16% Australia • Markets • International Banking Corporate & • Loans • Retail Banking Asia Pacific Commercial 26% Australia Retail Global Wealth • Insurance • Private Wealth • Funds Management • Advice & Distribution 77

Contribution by geography Operating Income by Geography Operating Income by Geography FY14 For personal use only APEA Network Australia New Zealand APEA Australia New Zealand APEA 16% $m 25,000 18% 19,578 18,391 17,848 20,000 APEA Network 16,812 15,782 Revenue 1 represents income 15,000 24% generated in 19% Australia & New 10,000 Zealand as a result of referral from 5,000 ANZ‟s APEA 64% network. 61% 0 FY10 FY11 FY12 FY13 FY14 Net Profit after Tax by Geography Net Profit after Tax by Geography FY14 Australia New Zealand APEA Australia New Zealand APEA $m 8,000 7,117 14% 13% 16% 17% 17% 6,492 7,000 5,830 14% 5,652 17% 17% 18% 6,000 22% 5,025 5,000 4,000 3,000 72% 70% 66% 66% 61% 2,000 1,000 0 FY10 FY11 FY12 FY13 FY14 FY10 FY11 FY12 FY13 FY14 1. APEA Network Revenue represents income generated in Australia & New Zealand as a result of referral from ANZ‟s APEA network 78

Customer loans and deposits by Geography Customer Lending 1 by Geography of FY14 Customer Deposits by Geography of FY14 For personal use only APEA APEA 15% 27% New New Zealand Zealand 18% 17% Australia Australia 56% 67% Customer Lending 1 by Geographic Segment Customer Deposits by Geographic Segment $b $b Retail & Wealth New Retail & Wealth 94 New Zealand 68 Commercial Zealand Commercial Institutional Institutional 79 APEA APEA 108 Australia 349 228 Australia - 50 100 150 200 250 300 350 - 50 100 150 200 250 300 350 1. Customer lending represents Net Loans & Advances including acceptances 79

Total Credit Exposure (EAD) by Geography Exposure at Default by Exposure at Default 1 by Geography For personal use only Line of Business 2 Total Exposure at Default (Sep 14) - $796b 1 Retail Institutional Commercial Australia New Zealand APEA 16% $494.1b $131.0b $170.8b 29% 30% New Zealand 4% UK & Europe 22% 16% 3% Americas 94% 1% Pacific Australia 4% APEA 62% Singapore 22% 2% Hong Kong 5% 54% 49% Other North 3% East Asia Other South East Asia 6% Australia New Zealand APEA 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 80

Customer loans and deposits by client segment Customer Lending 1 by Segment Customer Deposits by Segment For personal use only (Sep-14) (Sep-14) Australia New Zealand Commercial Institutional Australia Australia New Zealand Commercial Institutional Commercial 17% 10% 13% 4% 11% Commercial 42% New Zealand Australia 22% Retail & Wealth 23% APEA Commercial 16% 7% 12% Institutional Institutional Commercial APEA Retail Institutional 2% APEA & Wealth 13% Institutional 25% New Zealand Retail & Wealth 9% Retail & Wealth Retail & Wealth 3% 1% 52% New Zealand 42% Institutional New Zealand 5% Institutional APEA Retail & 28% 43% Wealth Australia Australia Retail & Wealth Retail & Wealth 1. Customer lending represents Net Loans & Advances including acceptances 81

2014 FULL YEAR For personal use only RESULTS AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED 31 October 2014 Divisional Performance

Australia Division - strengthening ANZ's position in core markets by focussing on the customer experience ANZ Group Strategy For personal use only Built on common infra- Connecting customers Strengthen our structure & enterprise STRONG PROFITABLE to faster growing position in our core ENTERPRISE focus for greater CORE ASIAN regional capital, markets of Australia APPROACH responsiveness, MARKETS GROWTH trade & wealth flows & New Zealand efficiency and control Australia Division Strategy • 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 an understanding of customer needs Customer Customer Value Transformation Financial Needs Proposition Outcomes Developing a deep Building a Growing market Investing through understanding of compelling customer share, managing our Banking on customer needs in value proposition margins and costs Australia program to our target segments that is aligned to and maintaining meet changing their needs asset quality customer needs 83

Banking on Australia is transforming the business and positioning ANZ for sustainable growth FY14 FY13 FY14 FY13 STRONG CORE MARKETS For personal use only Transforming distribution Delivering leading digital & mobile solutions # new sales focused $ transactions processed on 143 94 $100b+ $56b branches & business centres goMoney TM since launch 2 % digital sales of Retail # Smart ATMs improving 772 201 21% 17% Transaction and Credit Card customer self-service products # work requests processed by Business Response Team, # Digital A-Z Reviews 140k - 72k 5k increasing C&CB bankers‟ completed by C&CB 3 customer facing time 1 Building capability & capacity Simplifying products & processes % annual improvement in % Retail frontline staff who 56% 51% Australian Operations 14% 14% are focused on sales productivity 4 # Institutional specialists # Retail accounts receiving dedicated to supporting 144 114 2.6m 1.6m „online only‟ statements C&CB customers # hours of sales focused # products decommissioned 219k 181k training across Retail and since Banking on Australia 48 27 C&CB to build capability inception 5 1. Business Response Team fully deployed in FY14, data not available for FY13; 2. Represents dollar value of transactions processed on ANZ goMoneyTM since launch in Sep-10; 3. Digital A-Z Reviews piloted through 4Q13; 4. Operations productivity in FY14 is a combination of 6% cost reduction and 8% increase in volume; 5. Banking on Australia inception was Oct-12 84

Australia Division is delivering growth and strengthening our position in key core markets Divisional profit up 7% YOY to $3.05 billion STRONG CORE MARKETS For personal use only Net new customers Lending FUM 2H PBP momentum Retail C&CB 1 Home Loans Retail C&CB Small Business m m 5.20 0.50  79k  7%  7% Growing  4%  16% $1.6b Retail and $209b  27k 5.10 $1.04b 0.45 Commercial $12.3b $195b  $1.5b $10.6b $1.0b flat 5.00 0.40 Aug-13 Aug-14 Aug-13 Aug-14 Sep-13 Sep-14 Sep-13 Sep-14 1H14 2H14 1H14 2H14 Migrant customers acquired Cross border referrals 2 FX turnover volume 3 outside Australia Leveraging $b „000  725  19%  6% Super 1,500 40 20 30 15 Regional 1,000 20 10 Capability 500 10 5 0 0 0 FY13 FY14 FY13 FY14 FY13 FY14 Operations productivity Wealth Cross-Sell Cost to Income Operations Operations Retail C&CB $m cost volume  59bps  6% 500  14% productivity Enterprise 400 37.7% 8% 300 Approach 37.2%  14% 200 100 0 FY13 FY14 FY13 FY14 FY13 FY14 -6% 1. Excludes Esanda contracts 2. Cross border referrals for commercial opportunities, originating from Australia 3. Foreign exchange turnover (volume) for C&CB customers 85

Retail – Continuing to build capability and delivering strong sales outcomes and productivity Building sales capability Delivering sales outcomes STRONG CORE MARKETS For personal use only Branch sales staff accredited to sell Home 70% #1 Fastest Home Loan growth amongst peers 1 Loans Consecutive quarters of above system Branch sales staff accredited to sell Wealth 53% 18 Home Loan growth to Aug 2014 and on products track to record a 19 th consecutive quarter Retail customer Main Financial Institution Branch sales staff trained to sell Small 58% 82.6% satisfaction score 3 in September 2014, an Business products increase from 80.2% in September 2013 Growing Home Loan sales in proprietary Increasing sales productivity channels Home Loan Sales Retail Revenue per FTE % of Total $‟000/FTE Proprietary Broker  14% 700  21% $53.5b $46.4b $44.3b 650 48% 48% 54% 600 52% 52% 46% 550 FY12 FY13 FY14 FY12 FY13 FY14 1. Source: APRA Monthly Banking Statistics, 12 months to Aug-14; 2. Based on range of expected results for system growth in Sep-14 quarter; 3. Source: Roy Morgan Research. Retail MFI CSAT – retail customers aged 14+ who hold a deposit product and consider ANZ to be their main financial institution. Customers who are Very or Fairly Satisfied. Rolling 6 months. 86

Retail – delivering leading mobile and digital solutions to meet changing customer needs and improve productivity We‟re investing in digital … as customers change the way …and increasingly prefer channels… they want to bank with us… mobile STRONG CORE MARKETS For personal use only Monthly Retail Transaction Volumes 1 Monthly Retail Logins • Mobile optimised content to #m #m enhance experience for customers on 25 tablet and mobile devices Internet Banking 40 Branch Digital goMoney 20 • Enhanced online tools and 30 calculators to drive acquisition and 15 increase conversion 20 10 10 • Online responsive sales 5 applications to enable sales through - digital channels - Sep-11 Sep-12 Sep-13 Sep-14 Aug-10 Aug-11 Aug-12 Aug-13 Aug-14 Enabling capacity to focus on … by improving branch ..and increasing our sales higher value sales… productivity… capacity Sales volume in Retail channels 2 Customer Branch Traffic and Sales Sales and Service FTE #k Productivity # Index Sep-11 = 100 250  8% 130 3,500 Sales per Sales FTE 200 Transacting Customers per day 120  8% 150 3,000 110 100 100 50 2,500 Sales FTE 0 90 Service FTE FY13 FY14 FY13 FY14 80 2,000 Wealth Small Business Sep-11 Sep-12 Sep-13 Sep-14 Sep-12 Sep-13 Sep-14 products products 1. Inclusive of Transaction events across Retail and C&CB. Branch excludes Third Party Collections transactions processed in the back office, Digital transactions includes Internet Banking, goMoney and Grow Oct 11 to Sept 14; 2. Excludes sales of Wealth products through Wealth channels 87

C&CB – Continued focus on transforming the business with improved momentum in 2H14 Key initiatives across the business… …underpin FY14 performance STRONG CORE MARKETS For personal use only Expanded lending pledge to new Small Lending growth in Small Business (total  16% $2b Businesses C&CB lending up 3%) More work requests being processed by Net growth in Corporate and Commercial  49%  27k BRT each day, thereby freeing up frontline customers 3 banker time to spend with customers 1 Reduction in Net Impaired Assets as a Training hours delivered with a specific  45bps 81k proportion of Gross Lending Assets 4 focus on lifting sales and credit capability 2 Continued gains in productivity Improved sales momentum in 2H14 C&CB FUM per FTE Business Credit Growth 5 C&CB Lending & Deposit $m %, YoY FUM $b  10% 4% 50  4% 116 112 3% 40 2% 30 1% 0% 20 Oct-12 Oct-13 Aug-14 Mar-14 Sep-14 Sep-12 Sep-13 Sep-14 1. Increase in Business Response Team (BRT) work requests processed per FTE per day from 1H14 to 2H14 (BRT fully deployed in 2Q14); 2. Training hours delivered in FY14; 3. Net increase in customers 12 months to Aug-14. Excludes Esanda contracts; 4. For 12 months to Sep-14; 5. Business Credit, seasonally adjusted, RBA, Oct-12 to Aug-14 88

Leveraging ANZ‟s super regional connectivity to deliver long term, sustainable growth Being the bank of choice for international Supporting our customers to do business STRONG CORE MARKETS For personal use only customers in Australia across the region $365m Deposits held by Retail International customers Cross border C&CB referrals from Australia 1,377 acquired overseas 1 supported by new online Global Referral Tool International customers acquired and  16% Growth in C&CB customers with a Trade 17k onboarded prior to arriving in Australia relationship International Branches 2 with multi-lingual Dedicated regional desks in key centres, 64 7 capability and resources supporting ANZ customers expanding offshore The International segment represents Leading super regional capability appeals 40% of Transaction Customer Acquisition to customers Can service my business needs in Asia, Australia & NZ 4 Retail Transaction Customer Acquisition 3 % % 45% #1 40% 35% International 40% 30% Domestic 60% 25% 20% Oct-12 Apr-13 Oct-13 Apr-14 ANZ Peer 1 Peer 2 Peer 3 1. For customers acquired in FY14; 2. International branches are located in Australia and focussed on International customers; 3. New to bank transaction customer acquisition for the 12 months to Sep-14; 4. Proportion of Commercial customers ($1m to <$40m turnover) associating institution with the statement „can service my business needs across Asia, Australia and New Zealand‟, rolling 3 month average, 89 DBM Financial Services Monitor, Oct-12 to Sep-14

Enterprise approach is driving improvements in productivity, leveraging scale and increasing cross-sell STRONG CORE MARKETS For personal use only Leveraging our • Improving Operations overall productivity by 14%, with total costs and Regional Delivery cost/FTE reducing, while volumes continued to increase Network Utilising our super regional • Customer complaints down 8% through product simplification and taking footprint to enhance an end-to-end approach to improve processes productivity • Launched Global Asset Finance (GAF), a new core platform to enhance and grow asset finance capability across the Group, reducing the time to Building common complete key sales processes from days to minutes infrastructure • Deployed a common foundational digital platform for Singapore, Hong Driving economies of scale Kong and Australia. and efficiency across the enterprise • Established Enterprise Data Warehouse to build a common data platform • 53% of branch sales staff accredited to sell Wealth products and „Whole of ANZ‟ increased specialised coverage, supporting growth in Wealth cross-sell approach across the Australia Division. Increasing collaboration • Increasing coverage from specialist product partners in C&CB (IIB FTE and connectivity across dedicated to C&CB up 26% in FY14), supporting an increase in C&CB the enterprise customers holding IIB products (up 15% in FY14) 90

Australia Division Financial Performance – P&L Net Interest Margin Profit and Loss movement FY14 vs FY13 STRONG CORE MARKETS For personal use only % change:  6%  1%  3% -  7% 2.52% 2.51% 2.48% $m 107 72 1 276 80 7 3,048 90 89 2,858  7% FY13 Vol. Margin Vol. Margin OOI Expenses Provisions Tax FY14 FY12 FY13 FY14 Retail C&CB Net Interest Income Cost to income Profit and Loss movement 2H14 vs 1H14 % change:  5%  1%  4%  3%  5% 40.8% 37.7% 37.2% 7 15 27 $m 72 1,569 73 57 13 34 1,479  6% 1H14 Vol. Margin Vol. Margin OOI Expenses Provisions Tax 2H14 FY12 FY13 FY14 Retail C&CB Net Interest Income 91

Australia Division Financial Performance – Balance Sheet Loan movement Customer lending composition STRONG CORE MARKETS For personal use only Asset Finance Sep-14 % change:  7%  1%  3% $288b 5% 1.8 287.9 Business 0.1 14.4 6% Lending $b 18% 18% 271.6 Sep-13 Other 4% 4% $272b Retail  6% 72% Sep-13 Home Other C&CB Sep-14 Home Loans Loans Retail 73% Deposit Movement Customer deposit composition Sep-14 Offset Balances Growth:  5%  8% $161b 11% 161.1 3.6 Transaction 10% $b 5.1 35% Term 20% 19% 39% Sep-13 $152b 152.4 13%  6% Online 19% 15% Sep-13 Retail C&CB Sep-14 19% Savings 92

Australia Division business unit performance Income Expenses PBP NPAT Cost to STRONG CORE MARKETS For personal use only ($m) ($m) ($m) ($m) Income % FY14 8,228 3,057 5,171 3,048 37.2% Australia FY14 v 5% 3% 6% 7% -59bps Division FY13 2H14 v 5% 4% 5% 6% -37bps 1H14 FY14 5,176 2,051 3,125 1,927 39.6% FY14 v Retail 7% 4% 9% 12% -123bps FY13 2H14 v 6% 5% 7% 7% -42bps 1H14 FY14 3,052 1,006 2,046 1,121 33.0% Corporate & FY14 v Commercial 1% 2% 1% -1% +20bps FY13 Banking 2H14 v 3% 2% 4% 5% -38bps 1H14 93

Retail – Financial Performance Profit and Loss movement FY14 vs FY13 STRONG CORE MARKETS For personal use only YOY % change:  7%  4%  6%  12% HOH % change:  6%  5%  9%  5% 72 26 276 $m 1,927 13 73 1,725 86 1,444  12% FY12 FY13 Volume Margin OOI Exp. Provisions Tax FY14 Income Net Interest Margin Cost to Income 45.1% 2.00% 40.9% 39.6% 1.96% 1.86% FY12 FY13 FY14 FY12 FY13 FY14 94

Retail – Consistent balance sheet growth Home Loan growth 1 Deposit Growth 1 STRONG CORE MARKETS For personal use only Household Lending Market Share Growth (%) Household Deposits Market Share Growth (%) Index Sep-12 = 100 Index Sep-12 = 100 Peer 1 Peer 2 Peer 3 ANZ ANZ Peer 1 Peer 2 Peer 3 103 103 102.9 102 102 101.7 101 101.7 101 100 100.0 100 99 99.0 99.8 99 99.3 98 97.5 98 97 Aug-14 Sep-12 Mar-13 Sep-13 Mar-14 Aug-14 Sep-12 Mar-13 Sep-13 Mar-14 ANZ ANZ Market 14.7% 14.8% 14.8% 14.9% 14.9% Market 14.9% 15.0% 14.9% 15.0% 14.9% Share: Share: Home Loan sales and paydowns Deposit volume growth $b $b  5% Sales up 15% 112.1 14 107.0 97.6 53 209 195 47 6  7% FY13 New Redraw Repay. Ext. FY14 FY12 FY13 FY14 Fundings & /Other Refin Interest -ance 1. Source: APRA Monthly Banking Statistics, August 2014 95

C&CB – Financial Performance Profit and Loss movement FY14 vs FY13 Lending growth by business STRONG CORE MARKETS For personal use only % change:  16%  1%  3% -  2% % change:  1%  2%  2%  6%  1% $b $m 6 0.3 27 0.1 67.1 1.8 65.3 1,133 1,121 - 0.4 17 3 25  3%  1% FY13 NII OOI Exp. Provisions Tax FY14 FY13 Small Bus. Reg. Corp. Esanda FY14 Bus. Banking Bus. Banking Banking Banking Profit and Loss movement 2H14 vs 1H14 Deposit growth by business % change:  3%  4%  2%  2%  6% % change:  7%  14%  1% $m $b 6 42 4 - 575 49.0 1.7 1.9 10 45.4 13 546  5%  8% 1H14 NII OOI Exp. Provisions Tax 2H14 FY13 Small Bus. Reg. FY14 Bus. Banking Bus. Banking Banking 96

C&CB – greater momentum in second half Recent improvements in business …are slowly translating to increased STRONG CORE MARKETS For personal use only confidence and business conditions… demand for business credit Business Conditions (Net Balance) 1 Business Credit 2 and Loan Approvals 3 12 7% 4% 8 3% 6% 4 2% 5% 0 1% -4 4% 0% Oct-12 Apr-13 Oct-13 Apr-14 -8 Loan Approvals (LHS) Business Credit (RHS) Sep-14 Oct-12 Apr-13 Oct-13 Apr-14 Trends in sales and pay downs are …and have contributed to improved encouraging… revenue momentum in 2H14 Direct Revenue Cross Sell Revenue Net Loans & Advances $b $m $m  3% 8 Retail 7 67  3% 65 1,600 65 1,500 5%  1% 6 7 1,550 Wealth 1,000 14% 1,500 Insto. 500 1,450 flat  3% -3% 1,400 - Sep-13 Sales Pay Mar-14 Sales Pay Sep-14 2H13 Mvmt. 1H14 Mvmt. 2H14 FY13 FY14 Downs Downs 1. Ai Group Performance of Construction, Performance of Manufacturing and Performance of Services Indices, combined and indexed by ANZ Research, Oct-12 to Sep-14 2. Year-on-year change in Business Credit, seasonally adjusted, RBA, Oct-12 to Aug-14 97 3. Trend in monthly business loan approvals as a proportion of total business credit outstanding per ABS, Oct-12 to Jul-14

C&CB – a diversified portfolio with continued improvements in asset quality and performance C&CB maintains a diversified portfolio, covering numerous market and customer segments STRONG CORE MARKETS For personal use only Net Loans & Advances Exposure at Default by Industry (%) Industry exposure remains stable Corporate Banking 14% 18% Retail 13% 15% Esanda Property & Construction 29% 29% $67b 24% Agriculture Regional Business Banking 25% 13% 13% Business Services 11% 10% Business Banking 6% 6% Manufacturing 19% 28% 27% Other Small Business Banking Sep-13 Sep-14 Improving asset quality Portfolio performance has improved Net Impaired Assets EAD by Customer Credit Rating (%) Stronger Net Impaired Assets ($m, LHS) 9.2% 9.0% 9.0% 0 - 3 Net Impaired Assets as % GLA (%, RHS) 1,000 1.80% 800 77.9% 78.4% 4 - 6 78.7% 1.30% 600 400 0.80% 200 7 - 10 12.9% 12.6% 12.2% Weaker 0 0.30% Sep-13 Mar-14 Sep-14 Sep-12 Mar-13 Sep-13 Mar-14 Sep-14 98

Creating New Zealand‟s best bank ANZ Group Strategy STRONG CORE MARKETS For personal use only Built on common infra- Connecting customers Strengthen our structure & enterprise PROFITABLE STRONG to faster growing position in our core ENTERPRISE focus for greater ASIAN CORE regional capital, markets of Australia APPROACH responsiveness, MARKETS GROWTH trade & wealth flows & New Zealand efficiency and control ANZ New Zealand‟s Strategy 1. Leverage our scale advantage by building and enabling world class sales teams to capture cross sell and share growth 2. Empower customers and drive efficiency and sales through further developing digital and payments capability 3. Maximise our scale advantage by simplifying our products, processes, policies, technology & leveraging Group investment 4. Capitalise on our data advantage by improving our data and insights infrastructure and end-to-end leads processes 5. Improve our connections between frontline channels to support customer interactions NZ‟s Best Bank How? Leverage Scale NZ‟s Best Bank • Best brand How? consideration Our Vision: Create Scale  Hubs • Integrated channels „Helping Kiwis achieve more‟  Branch optimisation leveraging Group How? Our Goal: platforms  Leading brand  One team • #1 Service recognition • Data driven insights  One set of systems • #1 Market Share • World class sales and • Automation of work  One product set service teams flow • Growing  One brand • Core remediation • Optimised channel • Visible in the community  One branch network investment • Payment infrastructure 2010-2013 2013-2016 2017 99

Our strategy is delivering a scale advantage Create scale Leverage scale Scale advantage STRONG CORE MARKETS For personal use only 2010 - 2013 2013 - 2016 2017 2010 2014 2017 Core systems 2 1 1 Brands 2 1 1 ANZ brand 27% 44% Market leading consideration 1 Staff engagement 64% 78% 3 Best practice NZ Geography 49.1% 38.9% 4 Market leading - CTI - Cash profit ( NZDm) 866 1,682 NZ Division 48.4% 2 41.1% Market leading - CTI - Cash profit (NZDm) 545 2 1,170 • • • Brought 2 brands together Leveraging global hubs Natural competitive and shared platforms advantage in key markets • Moved to 1 core banking • system Improving branch • Enhancing digital offering coverage • Created 1 management for improved customer • structure Rolling out customer data experience and banker focused sales strategy efficiency • Simplified and moved to a single set of policies, processes and products 1. Source: McCulley Research Limited (first choice or seriously considered) 2. FY10 result on a consistent basis 100 3. Staff engagement survey for 2014 as at July 2014 100 4. Including the one off insurance recovery related to the ING frozen funds (excluding: 39.87%)