Suncorp Bank Debt Investor Presentation 1 Suncorp Group Lim ited - PowerPoint PPT Presentation

Suncorp Group Lim ited Suncorp Group Lim ited Suncorp Bank Debt Investor Presentation 1 Suncorp Group Lim ited Novem ber 20 15

Suncorp Investor Update Agenda 3 Suncorp Group 5 Group Financial Results & Capital Suncorp Bank – APS330 19 Funding & Liquidity 29 34 Australian Mortgages 2 Suncorp Group Lim ited Novem ber 20 15

Suncorp Group Leading financial services brands in Australia and New Zealand Top 15 ASX listed company $16.8 billion market capitalisation* as at 18 November, 2015 $94 billion in group assets 14,500 employees in Australia and New Zealand 9 million customers Issuer Credit Ratings of A+ / A1 / A+ with S&P / Moody’s / Fitch respectively 3 *Source: Bloomberg Suncorp Group Lim ited Novem ber 20 15

Group Capital Structure Shareholders Surplus returned Ordinary dividend – 60-80% of cash earnings to shareholders Distributable earnings Surplus assets Maintain capital targets Suncorp Group GI Life Bank General Bank Life Insurance (Suncorp Metway Ltd) • Suncorp Metway Ltd is the entity that issues senior debt instruments on behalf of the Bank • General Insurance is the entity that issues sub-debt instruments on behalf of AAI Limited and SIF Limited • Suncorp Group Limited is typically the entity that issues Basel III compliant CPS 4 Suncorp Group Lim ited Novem ber 20 15

Group Financial Results and Capital 5 Suncorp Group Lim ited Novem ber 20 15

Result overview ($m ) (June 20 15) %∆ FY15 FY14 General Insurance NPAT 756 1,010 (25.1) Bank NPAT 354 228 55.3 Suncorp Life NPAT 125 92 35.9 Business lines NPAT 1,235 1,330 (7.1) Other (44) (26) 69.2 Cash earnings 1,191 1,304 (8.7) Life Insurance write-down - (496) n/a Other profit and acquisition amortisation (58) (78) (25.6) NPAT 1,133 730 55.2 6 Suncorp Group Lim ited Novem ber 20 15

Suncorp Group business line NPAT ($m ) (June 20 15) Profit diversification FY12 FY13 FY14 FY15 770 600 1,330 1,235 8 12 105 883 756 1010 493 113 146 120 84 354 289 289 228 (263) (632) General Insurance Bank Life underlying NPAT Non-core Bank (60) Life market adjustments 7 Suncorp Group Lim ited Novem ber 20 15

General Insurance (June 20 15) % Δ $m FY15 General Insurance profit after tax 756 (25.1) Reserve releases of $427 million Underlying ITR of 14.7% exceeding commitment to ‘meet or beat’ 12% Natural hazards $473 million above allowance Reported ITR of 11.4% GWP up 0.1% with positive unit GI CET1 1.40x PCA growth in Personal lines 8 Suncorp Group Lim ited Novem ber 20 15

A diversified insurance portfolio Geographic diversification Market Share Diversified by industry class Gross Written Premium Gross Written Premium Home and Motor Insurance by Geography by Product Australia - 28% WA 8% Other Commercial Commercial Insurance VIC 9% 24% CTP 21% Australia - 17% 15% QLD Compulsory Third Party Home 30% QLD - 50% 28% Motor NSW 33% 32% Compulsory Third Party NSW - 27% 9 Suncorp Group Lim ited Novem ber 20 15

Distribution – trusted brands Differentiated offerings, preserving core elem ents of each brand Suncorp Insurance: Personal Insurance market share Lead national brand: • The must-have in each State (1) • Relieve stress Queensland insurance • Competitive price positions • Strong community NT 11% connections Qld 34% WA 15% SA 15% State based brand in NSW 29% NSW and VIC: National life stage brand: • Providing certainty • Rewarding over 50s • Service excellence and Vic 32% more comprehensive cover • Showing understanding • Delivering service TAS 36% excellence (1) Roy Morgan market shares (Jul 2015) 10 Suncorp Group Lim ited Novem ber 20 15

Suncorp Life (June 20 15) % Δ $m FY15 Underlying profit after tax 113 34.5 Market adjustment after tax 12 50.0 Life profit after tax 125 35.9 Claims experience $8 million favourable Individual in-force premiums up 5.6% Lapse experience $7 million favourable Super new business up 23.4% driven by Strong growth in Direct sales via WealthSmart and Everyday Super insurance brands 11 Suncorp Group Lim ited Novem ber 20 15

Suncorp Bank (June 20 15) % Δ $m FY15 Bank profit after tax 354 55.3 NIM improved to 1.85% Cost to income ratio down to 53.4% Bank CET1 increased to 9.15% Deposit to loan ratio 65.3% Home lending up 7.1% Non performing loans down 20.1% Business lending down 7.3% Gross impaired assets down 34.5% 12 Suncorp Group Lim ited August 20 15

Suncorp Net Interest Margin Movem ents (June 20 15) 0.05% (0.01%) 1.85% (0.01%) 1.72% 0.21% (0.11%) 2014 Bank NIM Lending Mix / Spreads Retail Funding Mix / Wholesale Funding Balance sheet Earnings on Invested 2015 Bank NIM Spreads Mix/Spreads management Capital 13 Suncorp Group Lim ited Novem ber 20 15

Suncorp capital (June 20 15) $570 m excess CET1 on a post-dividend basis General NOHC and Suncorp $m Bank Life Insurance other entities Group total CET1 3,069 2,802 438 320 6,629 CET1 target 2,298 2,678 334 106 5,416 Excess (pre-div) 771 124 104 214 1,213 Dividend (643) Excess (post-div) 570 CET1 coverage ratio (pre-div) 1.40x 9.13% 1.77x Amount equal to sum CET1 targets 1.05x 8.75% of PCA plus a target excess 14 Suncorp Group Lim ited Novem ber 20 15

Aps330 Capital (Sept 20 15) Strong capital position Capital (CET1 ratio) CET1 position relative to peers 9.13% 9.94% 8.86% 9.20% 9.10% 9.00% 8.82% 8.91% 8.81% 8.86% 8.17% 8.70% 8.53% 8.22% SUN Regional 1 Regional 2 Major 1* Major 2 Major 3 Major 4 Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 CET1 source : regulatory CET1 per latest company disclosures. Majors as at Jun-15, Regional 1 Note: The Bank’s CET1 ratio decreased from Jun-15 to Sep-15 following the declaration of the as at Aug-15 and Regional 2 as at May-15. Major 1 is a pro-forma ratio post capital raising. Suncorp Group dividend in August. 15 Suncorp Group Lim ited Novem ber 20 15

Suncorp m arket shares Growth opportunities Home and Motor Incremental growth opportunities QLD CTP Insurance in markets where we are a 51% 29% leading player Growth opportunities from entering PI NZ # CTP NSW CI Aust CI NZ new markets and expanding in 21% 16% 25% 24% OUR HOW existing markets Suncorp Bank^ Suncorp Life` Potential to grow to natural market share 3% 5% in targeted segments 16 #Vero and AAI Suncorp Group Lim ited ^Residential mortgages Novem ber 20 15 `In-force individual risk premiums Australia.

Custom er A strengthened custom er franchise Strong outcom es across the Group Industry leading custom er satisfaction • Industry leading satisfaction in key Industry average Jun 14 Jun 15 88 87 business lines 85 84 84 • 4 of the top 5 most advocated national 83 82 82 insurance brands 79 • Improved retention • Deeper relationships • Attracting new customers Motor Home Bank 17 Suncorp Group Lim ited Novem ber 20 15

Optim ised Platform Unlocking the value of our 9 m illion custom ers Connected custom ers Sim plified system s BANK LIFE GENERAL INSURANCE CORPORATE Underpinned by SUNCORP DATA DATA LAKE SERVICES Business Intelligence Sitting within a CLOUD ENVIRONMENT secure and scalable cloud Supported by a unique way of working SERVICE RELENTLESS INNOVATION AGILE/ LEAN PARTNERING CULTURE EXECUTION 18 Suncorp Group Lim ited Novem ber 20 15

Suncorp Bank – APS330 Sept 20 15 Update 19 Suncorp Group Lim ited Novem ber 20 15

Suncorp Bank (Sept 20 15) • Total customer base of 1,059,000 Australia’s leading regional bank • Network of 200+ branches & business centres Home lending up 2.9% • Award-winning Mobile Business lending down 1.7% Banking App Queensland 124 branches Bank CET1 8.86% comfortably within the 7 agencies Western Australia 8.50%-9.00% target range 12 business centres 12 branches South 1 business centre Australia ACT 1 branch Non performing loans down 7.8% 1 business centre 2 branches New South Wales Victoria 41 branches 9 branches 3 business centres Gross impaired assets down 7.3% 2 business centres Tasmania 1 branch Branch, Business Centres as at Sep 2015. Customer figures at Dec 2014. Mobile Banking App won the QLD iAward, June 2014. 20 Suncorp Group Lim ited Novem ber 20 15

Suncorp Bank lending portfolio (Sept 20 15) Conservative approach to growth Lending assets $53 billion 73% business lending exposures <$10 m $25-$50m 7% Comm/SME 10% $10-$25m (down 1.4%) 20% < $5m 55% Agri 8% Housing 81% (down 2.0%) (up 2.9%) Consumer $5-$10m 1% 18% (down 3.9%) 21 21 Suncorp Group Lim ited Novem ber 20 15

Suncorp Bank lending portfolio (Sept 20 15) Now s ignificantly de-risked with 8 0 % m ortgage portfolio Jun 20 0 9 Lending Sep 20 15 Lending portfolio Portfolio Jun Sept Sum m ary portfolio ($54.4 bn) ($53 bn) Metrics 20 0 9 20 15 Exposures 121 0 Com/ Com/ over $50m SME SME 10% 10% Agri Agri Comm/ 6% 6% SME 10% Impaired $1,474m $202m (down assets 1.4%) Housing Housing Housing Agri 8% 52% 52% 81% Corporate Corporate (down (up 2.9%) Impairment & & 2.0%) $710m $6m Property Property losses 30% 30% Consumer 1% (down 3.9%) 22 Suncorp Group Lim ited Novem ber 20 15