Michael Smith Chief Executive Officer Chief Executive Officer 2 0 - PowerPoint PPT Presentation

Michael Smith Chief Executive Officer Chief Executive Officer

2 0 0 7 Annual General Meeting

View s on the global econom y Global econom ic grow th 8% Forecasts 7% 6% 5% 4% 3% 2% 1% 0% 1 9 7 0 1 9 7 2 1 9 7 4 1 9 7 6 1 9 7 8 1 9 8 0 1 9 8 2 1 9 8 4 1 9 8 6 1 9 8 8 1 9 9 0 1 9 9 2 1 9 9 4 1 9 9 6 1 9 9 8 2 0 0 0 2 0 0 2 2 0 0 4 2 0 0 6 2 0 0 8 2 0 1 0 Sources: IMF and Economics@ANZ . Note: GDP is measured in US$ at purchasing power parities

Major trends changing the w orld for banks and financial institutions Globalisation of capital Consolidation Convergence Technology Sustainability

Asia – an im portant driver of grow th • Top 10 European banks on average generate 11% of revenue from Asia Pacific • HSBC, Standard Chartered, UBS and Deutsche Bank generate $41bn revenue in Asia • In contrast, Australian banks generate ~ 1% of revenue from Asia

Consolidation and convergence • Expect continued consolidation of financial services businesses • 700 European banks expected to disappear through mergers over the next three years* • Increased competition and greater reliance on technology * based on analysis from Deloitte Accounting and Consulting firm

I nvesting in people ANZ has great people The next stage • Greater self confidence • Develop and recruit people who want to be the best and a great culture

My early im pressions Divisional level Asia/ Pacific I nstitutional New Zealand Personal Largest exposure Strong franchise Performing well Great shape of Aus banks Under-performing Constrained by Share of wallet High potential peers the economy opportunity Missed opportunities Group level • Leadership strength • Sights set too low • Great culture … but needs • Systems a constraint more edge • Issues with business mix Overall im pression: call to action • Aim higher • Drive grow th and out-perform ance

Personal – Leading share of w allet From To Strong grow th in new Maintain acquisition, custom ers Deepen relationships “Product of the Needs based selling m onth” Segm ent prioritised Product focused m arketing I n the pack on Clear leader in online technology and sales tools Below system Strong profit Continued profit out- Back to system out-perform ance perform ance perform ance and beyond

I nstitutional – Back to system From To Too internally focused Custom er focused Technology a Under-invested in critical enabler technology Conservative Risk Double Markets revenue approach Accelerate Asian grow th Back to system Below system and beyond perform ance

New Zealand – Grow ing share, sub 4 0 % CTI From To Custom er acquisition, Defending share, targeted segm ents repositioning ANZ Drive cost to incom e I ncrem ental cost below 4 0 % im provem ent Duplicate retail Single system system s Sustained Stable perform ance in out perform ance line w ith m arket

Asia-Pacific – As big as NZ by 2 0 1 2 From To Deepening franchise, Maintaining our custom er base & netw ork franchise capabilities Focus on Australia/ NZ Broaden focus linked custom ers Focused on core Asia platform via geographies Partnerships As big as NZ by 2 0 1 2 7 per cent of Group Net Profit After Tax ( ~ 2 0 % )

Our journey to becom ing a super regional bank TRANSFORM OUT PERFORM RESTORE • Quality on par Create a with global leaders leading • Institutional in our market back to system Super Regional • Best of breed • Increase customer bank revenue faster experience than costs • In-fill mergers Global quality, • Drive Asia profit and acquisitions regional focus in Asia • Capture existing opportunities • Unlock the value of our franchise 1 to 2 years 2 to 5 years 5 + years

Grow th based on four core capabilities From To Customer / Segment Product based Custom er centric focused Marketing is for Sales / Marketing Core skills for retail everyone focused Technology a A core source of Technology based constraint advantage Meeting Perform ance driven Out-performing expectations

Our vision is for ANZ to be a super regional bank Australia NZ Asia Other Pacific 69% of all ANZ profit 22% 7% 2% ANZ today ANZ 2 0 1 2 ~ 60% of all ANZ profit ~ 20% ~ 20% ~ 2% Australia NZ Asia • Personal – grow share • Grow • Organic share growth • I nstitutional – improve performance (with infill • Cost acquisition) synergies