11 HALF YEAR RESULTS AUSTRALIA AND NEW ZEALAND BANKING GROUP - - PowerPoint PPT Presentation

11

HALF YEAR RESULTS

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED

3 May 2011

Results Presentation & Investor Discussion Pack

11

HALF YEAR RESULTS

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED

3 May 2011

Mike Smith

Chief Executive Officer

Overview of financial performance

3

1H11 AUDm Growth vs 2H10 Growth vs 1H10 Underlying Profit 2,818 3% 23% Revenue 8,430 3% 11% Expenses 3,821 3% 18% Provisions 660 (9%) (40%) Statutory Net Profit After Tax 2,664 3% 38% EPS (cents) 109.6 2% 20% 1H11 Franked Dividend (cents) 64 n/a 23% Customer deposits 268,705 4% 13% Net loans and advances including acceptances 375,833 2% 7%

All figures other than statutory net profit after tax and dividend are presented on an underlying basis.

Australia

4

Underlying profit growth (AUDm) 1H11 v 2H10 1H11 v 1H10 Australia Region 2% 15% Australia Division (6%) 5%

1.2x 1.6x

Mortgages Household Deposits

System

1H11 Growth v System HOH1 Retail revenue, lending and deposit growth HOH

• 1. Source: APRA Statistics

0.95 1.00 1.05 1.10 1.15 1H10 2H10 1H11 Revenue Deposits Lending Rebased: 1H10 = 100

New Zealand

5

Underlying profit growth (NZDm) 1H11 v 2H10 1H11 v 1H10 New Zealand Region 19% 63% New Zealand Businesses 20%

large

NZ Businesses Pro forma Revenue & Margins

2.00% 2.10% 2.20% 2.30% 2.40% 2.50% 300 600 900 1,200 1,500 1H10 2H10 1H11 NZD m

NII (LHS) Other operating income (LHS) NZ Businesses NIM (RHS)

NZ Region revenue & expense growth (NZD)

5% 6%

• 3%

6% 4% 5% 4% 0% 2%

• 5%

2008 2009 2010 1H11 (PCP) 1H11 (HoH)

Revenue Expenses

Asia Pacific, Europe & America

6

Underlying profit growth (USDm) 1H11 v 2H10 1H11 v 1H10 Asia Pacific, Europe & America Region 11% 44%

19% 62% 22% 50% 0% 10% 20% 30% 40% 50% 60% 70% HOH PCP

Net loans & advances including acceptances Deposits

APEA lending and deposit growth HOH

15% 15% 70%

APEA New Zealand Australia APEA plus APEA sourced revenue 18% of Group

% 1H11 Group revenue

APEA sourced revenue contributed an additional 3% to Group revenues 1H11, up from 2% FY10

• 1. Includes RBS acquisition

1

Institutional

7

Increased connectivity driven revenue

78% 22% Cross border revenues up 10% PCP Cross Border Domestic Booked

Growing and diversifying regional client base

Geographic Mix of new clients won past 12 months

16% 61% 4% 20%

Australia Asia New Zealand Europe & America

Underlying profit growth (AUDm) 1H11 v 2H10 1H11 v 1H10 Institutional Division 10% 24%

Funding and Capital

Strong Capital Position

Core Tier-1 Capital Ratio March 2011

Strong Funding Composition

8

7% 8% 8% 8% 50% 55% 58% 60% 14% 15% 16% 15% 7% 5% 6% 6% 22% 17% 12% 11%

Sep 08 Sep 09 Sep 10 Mar 11

SHE & Hybrid Debt Customer funding >1 Year Residual Maturity Term Debt < 1 year Short Term W/sale Funding

8.5% ~9.5% ~11.8%

Current APRA Basel III Fully Aligned FSA

Emerging differentiation

9

• Super Regional strategy giving us greater exposure to

Asia‟s growth

• Building blocks in place via both acquisition and investment

in capability

• Developing stronger customer propositions
• Driving productivity gains from our hubs
• Integrating the Super Regional strategy into all our

businesses

11

HALF YEAR RESULTS

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED

3 May 2011

Peter Marriott

Chief Financial Officer

Up 3%

2,576 2,727 2,818 2,664 151 116 62 87 154

2H10 Statutory Profit Non-Core Items 2H10 Underlying Profit Profit Before Provisions Provisions Tax & OEI 1H11 Underlying profit Non-Core Items 1H11 Statutory Profit

$m

Up 3%

First Half 2011 – The Numbers

Performance 2H10 v 1H11

11

1H11 v 1H10

1H10 Statutory Profit Non-Core Items 2H10 Underlying Profit Profit Before Provisions Provisions Tax & OEI 1H11 Underlying Profit Non-Core Items 1H11 Statutory Profit

1,925 373 2,298 291 438 (209) 2,818 154 2,664 Up 7% Up 23% Up 38%

Adjust for acquisitions & FX – The Pro forma Numbers

12

2.6% 4.1% 2.6% 4.1% 2.7% 4.1% 3.4% 5.5%

Underlying Pro Forma Underlying Pro Forma Underlying Pro Forma Underlying Pro Forma

Revenue Expenses Profit before Provisions Net Profit after Tax

Growth 1H11 v 2H10 – Underlying & Pro forma Growth 1H11 v 1H10 – Underlying & Pro forma

Revenue Expenses Profit before Provisions Net Profit after Tax

Underlying Pro forma Underlying Pro forma Underlying Pro forma Underlying Pro forma 11% 8% 18% 10% 7% 6% 23% 22%

Foreign Exchange impacts

Earnings Composition by Region & Average Translation Rates

13

0.60 0.70 0.80 0.90 1.00 1.10 1.20 1.30 1.40 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2H09 1H10 2H10 1H11 APEA (LHS) New Zealand (LHS) Australia (LHS) AVG AUD/USD (RHS) AVG AUD/NZD (RHS) % Group Underlying profit (1.9%) ~(1.5%) (2.5%) ~(3.1%)

1H11 HOH FY11 @ Current rates

Current Hedging Unhedged

Earnings Per Share Impact

Divisional overview

14

Australia Division (AUD) APEA (USD) NZ Businesses (NZD) Institutional (AUD)

Profit Before Provisions (Pro forma)

1H11 HOH PCP 2,312 4% 5% 538 25% 20% 738 6% 14% 1,591 2% 1%

Underlying Profit (Pro forma)

1H11 HOH PCP 1,329 (6%) 2% 385 15% 38% 453 20% large increase 1,028 12% 26% Australia Division (AUD) APEA (USD) NZ Businesses (NZD) Institutional (AUD) NPAT 2H10 1H11 Increase 1H11 Decrease

Income composition

Income movement (Pro forma) 1H11 v 2H10 ($m) Markets Revenue by Geography

15

8,102 8,430

94 234 2H10 NII Other Income 1H11 Up 4%

400 800 1,200 1,600

1H08 2H08 1H09 2H09 1H10 2H10 1H11

$m

Australia APEA New Zealand Up 9% Up 2%

23% CAGR 5,548 5,642

126 220 2H10 NII Global Markets Other NII 1H11

$m

Pro forma NII movement 1H11 v 2H10

Up 4% Down 2%

Markets Mix Impact

249.7 247.2 1.3 0.4 4.2 7.2 1.0 5.4

2H10 Funding & Asset Mix Funding Costs Deposits Assets Other Markets 1H11

bps

Down 2.5 bps Up 2.9 bps Ex-Markets 278.0 280.9

Net Interest Margin

16

Movement 1H11 V 2H10

Movement 1H11 v 1H10 (bps)

1H10 Funding & Asset Mix Funding Costs Deposits Assets Other Markets 1H11 245.0 (0.4) (2.9) (10.1) 22.9 2.1 (9.3) 247.2

Divisional movement 1H11 v 2H10 (bps)

258.0 243.8 282.0 312.8 Australia Division NZ Businesses APEA ex-markets Institutional ex-Markets 2H10 1H11 Increase 1H11 Reduction

Up 4.0bps Up 5.6bps Up 6.0 bps Down 9.2bps

Net Interest Margin

• Key differentiator is asset mix:
• Mix of mortgages
• Institutional lending
• Greater proportion of undrawn

lines which are included in NII but not assets

• Line fees included in NII
• Higher capital

Composition of margin relative to peers

17

1.50% 1.70% 1.90% 2.10% 2.30% 2.50% 2.70%

2H07 1H08 2H08 1H09 2H09 1H10 2H10

ANZ CBA NAB WBC

Net Interest Margin HOH

Investment continues in high growth businesses

18

4% 1% 18% 4% 3%

• 4%

14% 8% Australia Division New Zealand Businesses Asia Pacific Europe & America Institutional Revenue & Expense Growth Pro forma 1H11 v 2H10 Mature Domestic Businesses Investing for Growth

Individual Provision Charge & Impaired Assets

19

Total Provision Charge New Impaired Assets

500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 1H09 2H09 1H10 2H10 1H11

AUDm

Australia Division NZ Businesses APEA ex-Institutional Institutional Oswal 3,035 3,600 3,126 2,319 2,437

• 200

200 400 600 800 1,000 1,200 1,400 1,600 1,800 1H09 2H09 1H10 2H10 1H11

AUDm

Institutional Australia Division NZ Businesses APEA ex-Institutional CP charge 1,435 1,621 1,098 722 660

Collective Provision Charge & Management Overlay

Collective Provision Charge

20

• 400
• 300
• 200
• 100

100 200 300 400 500 1H09 2H09 1H10 2H10 1H11

$m

Lending Growth Risk Profile Portfolio Mix Eco Cycle & Concentration (Management Overlay)

Management Overlay Charge 1H11

• 200

400 600

Mar09 Sep09 Mar10 Sep10 Mar11 $m

79

• 19

60

Australia Division NZ Businesses Group $m

Management Overlay Balance

Reflects release made prior to 1st Canterbury earthquake Natural Disasters

Outlook

Currency Impacts Cost Growth Group Margin ex-Markets Markets Income

21

2.35% 2.55% 2.69% 2.78% 2.81%

1H09 2H09 1H10 2H10 1H11 400 800 1200 1600

1H08 2H08 1H09 2H09 1H10 2H10 1H11

$m

Total Provision Charge Lending Volumes / Other Income

1,435 1,621 1,098 722 660 1H09 2H09 1H10 2H10 1H11

$m

(1.5%) ~(0.3%) (3.1%) ~(0.7%)

FY11 PCP @ Current rates FY11 sensitivity to further 5%

Current Hedging Unhedged 6%

• 1%

16% 12%

Australia Division NZ Businesses Institutional APEA ex- Institutional

Annualised HOH Growth (FX Adj) 1% 3% 4% 2% 5% 4% 1H10 2H10 1H11 Revenue Growth Expense Growth

• Mature
• Growth

11

HALF YEAR RESULTS

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED

3 May 2011

Investor Discussion Pack

Net Interest Margin

NIM movement summary

23 Some small variances to the detailed NIM pages exist as a result of rounding

Basis points (bps)

Group Regions Divisions

Australia NZ Australia Division NZ Businesses Global Institutional HOH PCP HOH PCP HOH PCP HOH PCP HOH PCP HOH PCP Starting NIM 249.7 245.0 263.1 259.6 234.0 219.7 254.0 264.0 238.2 221.2 217.0 213.8 Funding & Asset Mix 1.3

• 0.4
• 0.6
• 2.3
• 1.0
• 0.4
• 2.3
• 6.3
• 1.0

0.4

• 1.8
• 5.9

Funding Costs

• 0.4
• 2.9

1.1

• 1.3
• 3.9
• 6.9

2.6

• 2.8
• 5.8
• 8.8
• 1.9

4.4 Deposits

• 4.2
• 10.1
• 3.6
• 6.9
• 7.8
• 19.1
• 4.7
• 9.2
• 8.6
• 20.9

0.7

• 3.8

Assets 7.2 22.9 6.9 17.3 17.6 44.9 5.9 13.0 18.9 48.4 6.0 24.8 Other

• 1.0

2.0

• 1.1
• 1.9

2.1 9.0 2.5

• 0.7

2.1 3.5

• 12.2
• 7.5

Movement ex-markets 2.9 11.5 2.7 4.9 7.0 27.5 4.0

• 6.0

5.6 22.6

• 9.2

12.0 Markets

• 5.4
• 9.3
• 6.4
• 5.1
• 5.5
• 11.8

0.0 0.0 0.0 0.0

• 9.7
• 27.7

Total Movement

• 2.5

2.2

• 3.7
• 0.2

1.4 15.7 4.0

• 6.0

5.6 22.6

• 18.9
• 15.7

Ending NIM 247.2 247.2 259.4 259.4 235.4 235.4 258.0 258.0 243.8 243.8 198.1 198.1

Net Interest Margin

• Key differentiator is asset mix:
• Mix of mortgages
• Institutional lending
• Greater proportion of undrawn

lines which are included in NII but not assets

• Line fees included in NII
• Higher capital

Composition of margin relative to peers

24

1.50% 1.70% 1.90% 2.10% 2.30% 2.50% 2.70%

2H07 1H08 2H08 1H09 2H09 1H10 2H10

ANZ CBA NAB WBC

Net Interest Margin HOH

Drivers of Net Interest Margin

25

Geography Product Key Drivers by Product Category

2.81% Other Deposits Lending

Institutional Deposits Commercial Deposits Retail Deposits Institutional Lending Commercial Lending Retail Lending

APEA New Zealand Australia 2.81% 1H11 Net Interest Margin Ex-Markets Composition

Net Interest Margin - Group

26

Key drivers of movement Funding & Asset Mix Funding mix benefit from reduced reliance on wholesale funding and higher mix

• f free funds. This benefit was partially offset by higher proportion of Mortgages

and Relationship lending assets. Funding Costs Impact of higher wholesale funding costs Deposits Largely impacted by increased competition across NZ and Australia for deposits and negative product mix impacts Assets Asset repricing and mix benefits from the migration of fixed rate mortgages to variable rates in NZ and Australia. Fee income continues to benefit from higher commitment and line fees on undrawn balances in Relationship Lending

249.7 247.2 1.3 0.4 4.2 7.2 1.0 5.4

2H10 Funding & Asset Mix Funding Costs Deposits Assets Other Markets 1H11

bps

NIM movement 1H11 v 2H10

Ex-markets up 2.9 bps Down 2.5 bps

Net Interest Margin - Australia Division

27

Key drivers of movement Funding & Asset Mix Asset mix impacted an increase in the proportion of mortgage business during the half Funding Costs Favourable funding cost impact primarily from lower cost of basis risk Deposits Largely driven by mix impacts including switching to term deposit products, increased deposit competition and lower returns from the insensitive and replicating portfolio Assets Improved asset margins, product mix and shift from low margin fixed rate to variable rate mortgages offset by competition on lending facilities and lower fees

254.0 258.0 2.3 2.6 4.7 5.9 2.5

2H10 Funding & Asset Mix Funding Costs Deposits Assets Other 1H11

bps

NIM movement 1H11 v 2H10

Up 4.0 bps

Net Interest Margin - New Zealand Businesses

28

Key drivers of movement Funding & Asset Mix Decrease primarily driven by decline in net free funds and switching Funding Costs Increase in wholesale funding costs Deposits Continued increased competition in deposits Assets Increase driven by impact of asset repricing across all businesses and switching between fixed and variable home loans

238.2 243.8 1.0 5.8 8.6 18.9 2.1

2H10 Funding & Asset Mix Funding Costs Deposits Assets Other 1H11

bps

NIM movement 1H11 v 2H10

Up 5.6 bps

Net Interest Margin – Global Institutional

29

Key drivers of movement Funding & Asset Mix Increase in proportion of lower margin wholesale deposits Funding Costs Impact of higher funding costs primarily due to reduced spreads on deposit book and increased wholesale costs Deposits Improvement in margins from Asian Term Deposit‟s and product mix benefits from reduced mix in low-margin term deposits Assets Increase primarily driven by asset repricing and improved product mix benefits

• ffset by increased competition primarily in Relationship Lending

Other Various interest recoveries in 2H10

217.0 198.1 1.8 1.9 0.7 6.0 12.2 9.7

2H10 Funding & Asset Mix Funding Costs Deposits Assets Other Markets 1H11

bps

NIM movement 1H11 v 2H10

Ex-markets down 9.2 bps Down 18.9 bps

11

HALF YEAR RESULTS

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED

3 May 2011

Investor Discussion Pack

Balance Sheet Management

Group loans and deposits

50 100 150 200 250 300 350 400 Sep 07 Sep 08 Sep 09 Sep 10 Mar 11

$b

Retail Commercial Institutional

Group customer deposits Group net loans and advances (including acceptances)

31

50 100 150 200 250 300 350 400 Sep 07 Sep 08 Sep 09 Sep 10 Mar 11

$b

Growth Rates FY07 FY08 FY09 FY10 1H11 13% 15% (1%) 4% 2% Growth Rates FY07 FY08 FY09 FY10 1H11 15% 13% 14% 11% 4%

20 40 60 80 100 120 140 160 180 Sep 07 Sep 08 Sep 09 Sep 10 Mar 11 Sep 07 Sep 08 Sep 09 Sep 10 Mar 11 Sep 07 Sep 08 Sep 09 Sep 10 Mar 11

Retail Commercial Institutional

Customer deposits by geography

32

Australia (AUDb) New Zealand (NZDb) APEA (USDb)

Growth Rates FY08 FY09 FY10 1H11 10% 16% 7% 2% Growth Rates FY08 FY09 FY10 1H11 5% 1% 0% 5% Growth Rates FY08 FY09 FY10 1H11 49% 49% 72% 22%

• 1. Includes Wealth

1

86 99 100 40 40 44 105 113 118 7 7 7 238 259 269 Mar 10 Sep 10 Mar 11 Wealth Retail Commercial Institutional 37% 29% 77% 19% 19% 22% 29% 42% 48% 23% 44% 2% 1% 8% Group Australia APEA New Zealand

Customer deposit composition by segment

Group deposits by segment (AUDb) Deposits composition March 2011

33

• 1. Includes Group Centre

1

50 100 150 200 250 300 Sep 07 Sep 08 Sep 09 Sep 10 Mar 11 Sep 07 Sep 08 Sep 09 Sep 10 Mar 11 Sep 07 Sep 08 Sep 09 Sep 10 Mar 11

Retail Commercial Institutional

Net loans and advances by geography

34

Australia (AUDb) New Zealand (NZDb) APEA (USDb)

Growth Rates FY07 FY08 FY09 FY10 1H11 14% 0% 6% 3% Growth Rates FY07 FY08 FY09 FY10 1H11 11% (1%) (1%) (1%) Growth Rates FY07 FY08 FY09 FY10 1H11 large (2%) 45% 19%

• 1. Includes Wealth

1

73 76 80 84 85 84 177 186 191 18 20 20 Mar 10 Sep 10 Mar 11 Institutional Commercial Retail Mortgages Other Retail & Wealth 21% 19% 80% 7% 22% 17% 54% 51% 59% 37% 5% 5% 20% 2% Group Australia APEA New Zealand

Lending composition by segment

Group lending composition by segment (AUDb) Lending composition March 2011

35

353 367 376

164.8 168.1 5.1 0.0 0.2 1.1 1.4 1.2 5.3 0.1

Sep-10 Retail Wealth Esanda Regional Business Banking SBB Inst. Other Mar-11

$b

Australia Region - Deposits

36

7% 14% HOH PCP

Retail

10% 12% HOH PCP

Commercial

• 10%

7%

HOH PCP

Institutional

Growth Rates

0.75 1.00 1.25 1.50 1.75 Sep-10 Oct-10 Nov-10 Dec-10 Jan-11 Mar-11 System ANZ Deposits Growth of 1.6x system 1H11

Household deposit growth

(Multiple of system)1

1. APRA Statistics

Deposit movement – 1H11 v 2H10

Commercial

268.8 277.8 6.2 0.4 0.1 0.0 0.4 0.9 0.1 1.9 0.0

Sep-10 Mortgages Cards & Unsec. Wealth Esanda Regional Business Banking SBB Inst. Other Mar-11

$b

Australia Region - Lending

Lending movement – 1H11 v 2H10

37

4% 10% HOH PCP

Retail

1% 4%

HOH PCP

Commercial 4% 1%

HOH PCP

Institutional

Growth Rates

Commercial Retail

1.Source: APRA Statistics

0.5 1.0 1.5 2.0 Sep-10 Oct-10 Nov-10 Dec-10 Jan-11 Mar-11 System ANZ Lending Growth of 1.2x system 1H11

Mortgage lending growth1

(Multiple of system)

APEA Region - Deposits

• Deposit growth has been primarily driven by Institutional
• Growth has been particularly evident in

Japan, Taiwan, Singapore and Hong Kong, and across priority customer segments (including the Financial Institutions & Public Sector)

• Retail deposit growth reflects strategy to re-focus on core

affluent and emerging affluent customers.

38

Growth Rates

67% 6% 27%

Asia Pacific Europe & America

5% 53%

HOH PCP

Retail

1H11 Deposits by region (USD m)

28% 50%

HOH PCP

Institutional

APEA deposits

26.8 37.4 46.1 56.2

• 10

20 30 40 50 60 2H09 1H10 2H10 1H11 (USD b)

1H11 deposit growth by segment (HOH)

6% 4% 28% 0% 5% 10% 15% 20% 25% 30% Retail Asia Retail Pacific Institutional (%) RBS1 Impact 1H10 2H10 1.5 5.0

• 1. Deposits (in USDb) for the RBS acquisition, includes Vietnam, Philippines & Hong Kong in 1H10; Taiwan,

Singapore and Indonesia in 2H10

APEA Region - Lending

39

Growth Rates

8% 55%

HOH PCP

Retail 23% 64%

HOH PCP

Institutional 19% 62%

HOH PCP

APEA Region

APEA loans

16.7 17.7 24.1 28.8

• 5

10 15 20 25 30 35 2H09 1H10 2H10 1H11 (USD b)

1H11 loan growth by segment (HOH)

12% 2% 31% 19% 0% 5% 10% 15% 20% 25% 30% 35% Retail Asia Retail Pacific Inst. Trans. Banking Inst. Global Loans (%)

• A continued focus on customer acquisition, particularly in

Corporate & Institutional, has driven significant lending growth, particularly in Singapore and Hong Kong.

RBS1 Impact 1H10 2H10 0.4 2.8

• 1. Loans (in USDb) for the RBS acquisition, includes Vietnam, Philippines & Hong Kong in 1H10; Taiwan,

Singapore and Indonesia in 2H10

New Zealand Region Lending

Lending Movement – 1H11 v 2H10

40

• 1%
• 1%

HOH PCP

Retail

• 1%

0%

HOH PCP

Commercial 0% 0%

HOH PCP

Institutional

Growth Rates (NZD)

96.0 95.4 0.3 0.4 0.0 0.1

Sep 2010 Retail Commercial Institutional Wealth Mar 2011

NZDb

Down 1% Mar 10 Sep 10 Mar 11 Retail Commercial Institutional Wealth

38% 54% 7% 1%

Lending Composition by Business

95.7 96.0 95.4

New Zealand Region Deposits

Deposit Movement – 1H11 v 2H10

41

3% 4%

HOH PCP

Retail 9% 5%

HOH PCP

Commercial 4% 10%

HOH PCP

Institutional

Growth Rates (NZD)

59.7 62.8 0.8 1.5 0.5 0.3

Sep 2010 Retail Commercial Institutional Wealth Mar 2011

NZDb

Up 5% Mar 10 Sep 10 Mar 11 Retail Commercial Institutional Wealth

44% 29% 19% 8%

Deposit Composition by Business

59.3 59.7 62.8

Mar 09 Sep 09 Mar 10 Sep 10 Mar 11 Australia APEA New Zealand

Global Institutional Deposits

Deposit movement 1H11 v 2H10

42

• 10%

7%

HOH PCP

Australia 20% 33%

HOH PCP

APEA 1% 4%

HOH PCP

New Zealand

Growth Rates (AUD) 50% 41% 9%

Deposit Composition by Geography

76.9 79.8 86.4 98.7 100.3 98.7 100.3 5.2 6.8 0.0

Sep 2010 Australia APEA New Zealand Mar 2011

$b

Majority of reduction in wholesale investor, less sticky deposits

Global Institutional Lending

Lending movement – 1H11 v 2H10

43

4% 1%

HOH PCP

Australia 15% 46%

HOH PCP

APEA

• 4%
• 5%

HOH PCP

New Zealand

Growth Rates (AUD)

75.6 80.2 1.9 2.9 0.2

Sep 2010 Australia APEA New Zealand Mar 2011

$b

Up 6% Mar 09 Sep 09 Mar 10 Sep 10 Mar 11 Australia APEA New Zealand 66% 28% 6%

Lending Composition by Geography

85.4 70.6 73.1 75.6 80.2

11

HALF YEAR RESULTS

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED

3 May 2011

Investor Discussion Pack

Regional Performance (Geographies & Divisions)

1,733 1,927 1,962 709 186 434 671

• 50

150 350 550 750 950 1,150 1,350 1,550 1,750 1,950 2,150 1H10 2H10 1H11 1H11 by segment $m

Australia region

45

Pro Forma Net Profit After Tax

1H11 revenue by business1 1H11 NPAT by business1

38% 22% 10% 29%

Retail Commercial Wealth Institutional

1. Excludes Group Centre and Other

35% 22% 9% 34%

Retail Commercial Wealth Institutional

• Aus. Division

$1,329m Retail Wealth Commercial Institutional Group Centre

Australia region

Pro forma NPAT movement – 1H11 v 2H10 Pro forma NPAT movement – 1H11 v 1H10

46

1,927 1,962 57 48 99 13 16

2H10 Net Interest Other Income Exp. Prov. Tax and OEI 1H11

$m

2% 5% HOH PCP

Revenue

4% 8% HOH PCP

Expenses

2% 13% HOH PCP

Net Profit after Tax

Pro forma Growth Rates

• 2%
• 26%

HOH PCP

Provisions 1,733 1,962 197 94 178

198 82

1H10 Net Interest Other Income Exp. Prov. Tax and OEI 1H11

$m

Revenue growth: Australia Div = 4%; Institutional = -4%

Australia Division – Business update & strategy

• Mortgages growth 1.2x system and customer

deposit growth 1.6x system for the half

• Increased commercial customers - ANZ

Commercial Banking customers2 rose by 6.4% or 25.1k customers for the half

• Well advanced in Wealth business

integration, launch of OnePath brand, increased management bench strength

• Targeting Asian migrant and student flows

with pan-regional migrants making up ~20%

• f all new-to-market customers
• Leveraging links to Asia Pacific region with

169 referrals received from Asia Pacific Commercial customers in 1Q11

• Investing in customer facing technologies

(e.g. internet & mobile platforms and multi- lingual ATMs) and group wide systems to deliver the business agenda.

47

• 1. Source: APRA Statistics; 2. Excluding Esanda

ANZ Australia delivered a solid outcome

1.6x 1.2x

• 0.2

0.4 0.6 0.8 1.0 1.2 1.4 1.6 Household lending Household customer deposits

Multiple of system (1H11)1 Commercial deposits growth

10% 12% 12% 10%

• 5%

10% 15% Total Commercial Regional Commercial Banking Business Banking Small Business Banking

System

Australia Division

Pro forma NPAT movement – 1H11 v 2H10 Pro forma NPAT movement – 1H11 v 1H10

48

4% 5% HOH PCP

Revenue

3% 4% HOH PCP

Expenses

• 6%

2% HOH PCP

Net Profit after Tax

Pro forma Growth Rates

69% 17% HOH PCP

Provisions 1,411 1,329 149

8 57 169 3

2H10 Net Interest Other Income Exp. Prov. Tax and OEI 1H11

$m 1,303 1,329 175 10 72 61 26

1H10 Net Interest Other Income Exp. Prov. Tax and OEI 1H11

$m

Australia Division – Retail

49

6% 3% HOH PCP

Revenue

4% 2% HOH PCP

Expenses

2% 3% HOH PCP

Net Profit after Tax

Pro forma Growth Rates

37% 13% HOH PCP

Provisions

… leading to customer gains

(„000s; MFI Relationship)2 30 60 90 120 150 180 Jan-10 Apr-10 Jul-10 Oct-10 Jan-11

Peer 1 Peer 2 Peer 3 ANZ

Trial intention

(%) transactional account trial intention1 10 20 30 Jan-10 Apr-10 Jul-10 Oct-10 Jan-11

Peer 1 Peer 2 Peer 3 ANZ

• PBP up 7%
• Strong trial intention and customer acquisition
• Retail deposit FUM increased 7% HOH, particularly in term deposits

and savings products such as Progress Saver

• Retail deposits market share increased to 12.5% over the five months

to February

• Mortgages FUM up 4% HOH while NIM increased 4 bps
• NPAT growth was adversely impacted by flood provisions over the half

116 77 72 61

1.Source: Australian Retail Brand Monitor; 2. Source: Roy Morgan 12 month moving average

Australia Division – Commercial

1% 7% HOH PCP

Revenue

6% 8% HOH PCP

Expenses

• 12%

2% HOH PCP

Net Profit after Tax

Pro forma Growth Rates

67% 22% HOH PCP

Provisions

Investment in frontline FTE staff in 2H10

50

2,581 2,836 2,806 1H10 2H10 1H11

Customer growth

(„000s; Main Bank Relationship)2,3,4

• 5

10 15 20 Jan-10 Apr-10 Jul-10 Oct-10 Jan-11

Peer 1 Peer 2 Peer 3 ANZ

524 550 580

• 200

400 600 800 1H10 2H10 1H11 SBB Business Banking $m

Net interest income SBB & BB

44.5 45.7 46.2 33.2 33.7 37.2

• 10.0

20.0 30.0 40.0 50.0 1H10 2H10 1H11 NLA Deposit $b

Net loans and advances incl. acceptances & deposits

8 6 4 2

Commercial underlying performance uneven - Business and Small Business performance was solid offset by difficult conditions for Regional Commercial

• 1. Small Business Banking (SBB), Business Banking (BB), Regional Commercial Banking (RCB); 2. Source: DBM

Business Financial Services Monitor; 3. Based on rolling 12 months average and includes businesses that have changed MFI during the last 12 months; 4. Includes customers who did not have a MFI 12 months ago (start up businesses)

Credit Quality

• Higher provisions partly due to long-term

stress in the sector and also specifically for extreme weather events such as the Queensland floods. Delinquency trends higher in Western Australia (prolonged drought) while full effect of Queensland (Cyclone Yasi and flooding) is yet to emerge

• Majority of collective provision overlay for

Commercial is related to RCB Business Performance

• Significant increase in deposits (up 12%

HOH, 20% PCP)

• Lending down 3% HOH, flat PCP
• Revenue down 1% HOH following reduced

loan growth while expenses for the half were flat.

Australia Division – Regional Commercial Banking

51

Significant pay down of debt occurring after high agri cash inflows

Productive Loans v. Deposit FUM

6.0 7.0 8.0 9.0 10.0 11.0 12.0 13.0 14.0 11.0 12.0 13.0 14.0 Oct-08 Jul-09 Apr-10 Jan-11 Productive Loans Deposit FUM Productive Loans ($b) $0.6b Deposit FUM ($b) Pay down of debt

Australia Division – Wealth

Insurance in-force premiums

• Integration of former INGA business on track including OnePath new brand launch
• New ANZ Wealth business created (including OnePath, Private Bank and Investment

and Insurance) and management bench-strength improved

• Wealth NPAT down $41m primarily due to reduced net interest income (repayment
• f loans)
• Other operating income higher due to insurance book growth and favourable claims

experience offsetting higher funding costs and brokerage margin tightening

• Operating expenses flat HOH
• Strong growth across the insurance segments particularly in individual life
• Funds management growth subdued in difficult market conditions coupled with

business transformation

• $11m gross impact in General Insurance due to natural disasters (includes ex-gratia

payments to policy holders).

52

1% 5% HOH PCP

Operating Income

0% 4% HOH PCP

Operating Expenses

• 18%

1% HOH PCP

Net Profit after Tax

Pro forma Growth Rates

44,608 44,493 45,456

1H10 2H10 1H11

ANZ Trustees Ppty & Infra'ure. Cash and FI Global Equities

• Aus. Equities

$m

Funds Under Management

Up 2%

1,230 1,320 1,381 1H10 2H10 1H11 General Insurance Individual Group

$m Up 12%

Performance Highlights

• APEA derived revenue delivers an

additional 3% of Group revenues over revenues earned in the APEA geography

• 6th in Asia-Pacific ex-Japan DCM market
• Five-fold increase in Wealth AUM PCP
• Asia‟s Best Employer Brand Award, 2011

APEA - Business update and strategy

The APEA business continues to grow via organic build of customer relationships and core capabilities, and inter-connectivity across the network, together with Partnerships

ANZ number of branches and representative

• ffices

() Franchise Network Hubs Partnerships Demonstrating interconnectivity across the ANZ network India (1) Pacific (60) Indonesia (28) Singapore (6) Greater China (27) Greater Mekong (31) Malaysia Pacific- Aus/NZ Pacific- Asia Asia-US

Asia- Europe

Intra- Asia Asia- Aus/NZ

• Positive jaws despite high revenue growth and continued

investment, including local incorporation in China, India branch build, further investment in Partnerships, and rollout

• f platforms such as Transactive Asia
• Continuing to grow customer base and client penetration

through increasing industry focus, build out of regional product suite and improved of relationship management

• Accelerating „catch' and „throw' model to capitalise on multi-

national companies increasing business to/from Asia

• RBS integration nearing completion - over 2.4m customers in

Asia

• Launched Signature Priority Banking proposition in 8 countries
• Commercial build out focusing on customer acquisition and

increasing management bench strength

• Growth in deposits a priority

Focused investment and increased cost efficiency drives continued revenue and profit growth Institutional business continuing to grow… …while Retail & Wealth, Private Bank and Commercial businesses growing in target segments

53

Asia Pacific Footprint

Source: Bloomberg, Employer Branding Institute, internal financials Notes:

• 1. 1H FY 2011 annualised, FY 2010 is FX adjusted

2,094 1,023 1,071 1,268 1,214 573 641 730 500 1,000 1,500 2,000 2,500 FY10 1H10 2H10 1H11 Revenue Expenses (USD m)

Pro forma NPAT

APEA Division overview

54

Pro forma revenue & expenses 1H11 revenue by geography

38% 36% 14% 12%

South East Asia North East Asia Pacific Europe & America

1H11 revenue by business

52% 36% 12%

Institutional Retail Asia Partnerships 615 280 335 385 100 200 300 400 500 600 700 FY10 1H10 2H10 1H11 (USD m)

APEA Division financial performance

Pro forma NPAT movement – 1H11 v 2H10

55

Pro forma NPAT movement – 1H11 v 1H10

18% 24% HOH PCP

Revenue

14% 27% HOH PCP

Expenses

15% 38% HOH PCP

Net Profit after Tax

Pro forma Growth Rates

• 30%
• 62%

HOH PCP

Provisions 335 385 30 167 89 18 76

2H10 Net Interest Other Income Exp. Prov. Tax and OEI 1H11

USD m 280 385 72 173 157 71 54

1H10 Net Interest Other Income Exp. Prov. Tax and OEI 1H11

USD m

APEA Institutional

APEA Institutional revenue driven by Asia

56

30% 29% HOH PCP

Revenue

15% 37% HOH PCP

Expenses

28% 41% HOH PCP

Net Profit after Tax

Pro forma Growth Rates

69%

• 56%

HOH PCP

Provisions

Strong contribution by Global Markets

Underlying revenue (USD ‘000) 200 400 600 800

FY08 FY09 FY10 1H102 2H10 1H11

Trading Sales 68% 9% 13% 9% Asia Europe America Pacific Continue momentum across the region

• ~600 new clients over last 12 months1
• 23% lending growth and 28% deposit growth in 1H11
• Revenue contribution to Global Institutional increased to 26%

Ongoing investment in capability

• Global Markets platform and footprint
• ANZ Transactive cash management platform launched, with Singapore and Hong Kong
• n-line later this year
• Core banking platform development
• ~50 new products deployed into region

Increasing footprint, building connectivity

• Continue to invest in front line staff
• Expanding footprint in China, India, London and New York
• Continue to develop key markets of Indonesia, Singapore, Hong Kong and Japan

Ongoing sales momentum

• Industry specialisation
• Focus on product cross-sell and capturing intra Asia flows
• Diversifying business mix
• 1. APEA includes Commercial Bank

FY09 benefited from increased market volatility

Growth momentum in Asian Wealth AUM1

57

APEA Retail & Wealth

715 2,037 2,058 433 431 420 5 6 6 1H10 2H10 1H11

R&W Asia R&W Pacific Private Bank

Significant customer build-out

Customer Numbers (‘000) 1,439 5,248 5,838 1H10 2H10 1H11 14% 18% HOH PCP

Revenue

7% 17% HOH PCP

Expenses

large large HOH PCP

Net Profit after Tax

Pro forma Growth Rates

• 64%
• 66%

HOH PCP

Provisions

2 2

USD m

• 1. Assets Under Management (AUM); 2. Retail & Wealth (R&W);
• 3. Signature Priority Banking

Strong revenue growth in chosen customer segments

• 14% revenue increase HOH; positive JAWS
• Wealth AUM increased 11% HOH
• Focused acquisition on target segments; closed 82,500 accounts HOH

Customer Centricity

• Launched SPB3 in 6 Asian and 2 Pacific Countries
• Revamped sales incentive scheme - focus on customer satisfaction
• Expanded wealth management products (added 700+ products HOH)
• Launched mortgages in Singapore, Taiwan & Indonesia

Connectivity

• Focus on deposits / cross-sell of wealth management products
• Leveraging of strategic partnerships, e.g. Singapore Airlines

Channels

• Updated website look-and-feel
• Established standardised service levels for call centres
• Launched mobile banking application on iPhone in Taiwan

Includes accounts from RBS acquisition Includes accounts from RBS acquisition

1 2 3 4 5 Listed investment Unlisted investment

Asia Partnerships' contribution continues to be significant

58

• Sacombank impairment charge taken in 1H11 with

weak Vietnamese Dong and share price

• Key Partnerships delivering majority of profit
• Continue to add value to Partnerships through

infusion of ANZ talent and skills to “outperform”

• Invest in expansion opportunities at appropriate

times and as price, policy and regulations allow

Note: AMMB Holdings Berhad (AMMB), Shanghai Rural Commercial Bank (SRCB), P.T. Bank Pan Indonesia (Panin), Bank of Tianjin (BoT) and Saigon Thung Tin Commercial Joint-Stock Bank (Sacombank)

Profit contribution remained significant Driving outperformance Partnership contribution to APEA NPAT Growth in value in Partnerships

ANZ share as at (31 March 2011)

• 50
• 50

100 150 200 1H11 Others BoT Panin AMMB SRCB Sacombank

Current book + additional market value of listed partners Current book value Net cash investment

USD b USD m

Impacted by write-down of investment in Sacombank principally due to a decline in the Vietnamese currency

New Zealand – simplifying structure, systems and processes

• Management structure change will deliver greater external focus and

faster decision making while reducing costs

• Moved from six national management structures to three across Retail, Business

Banking and Commercial & Agri

• Business Banking now a standalone specialist business
• Commercial and Rural Businesses merged to form Commercial & Agri, broadens

service provided to agricultural sector

• Four distinct regions created & aligned across segments to bring

decision making closer to customer

• Moving to a single technology platform will drive efficiencies and

improve customer experience

• A NZD98 million post tax significant item charge related to this project

is reflected in the half year accounts

• Single refreshed core banking platform & single set of channel

platforms

• Removing product duplication to provide a simplified, market

competitive product suite

59

Simplifying our structure to be more customer focused Simplifying systems, products and processes

New Zealand economic update

• Emerging economic recovery impacted by the

Christchurch earthquake in February:

• Reconstruction work of $15-20bn is equivalent to up to 10%
• f annual GDP
• Immediate fall in confidence but subsequent recovery in

business confidence is encouraging

• Likely economic recovery from second half

2011, supported by:

• Record commodity prices
• Rugby World Cup
• Christchurch earthquake rebuilding
• NZ’s economic framework is serving the economy

well:

• RBNZ cut OCR by 50 bps in March
• Strong NZD/USD but weak NZD/AUD
• Low levels of government debt and scope to lean on the

balance sheet to support the economy near term

• Challenge is to unlock natural resource endowment

including water and strengthen trade linkages to Asia

• The medium-term outlook is more modest
• Extended period of deleveraging as the economy rebalances
• A lower trend growth rate in medium-term but stronger 5-

10 years out as areas of comparative advantage (e.g. primary production, tourism, water) are unlocked

• Household credit growth is expected to recover, but

will remain more closely tied to income growth of c.5% p.a.

• Demand for business finance is expected to increase

as the recovery progresses

60

• 4%
• 2%

0% 2% 4% 6% 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 GDP Annual % change

The Canterbury earthquake delayed the upswing

Lending Growth FY10 FY11 FY12 FY13 FY14 Housing 3.0 1.7 4.8 4.3 4.3 Consumer Finance 2.2 4.2 4.0 4.3 4.9 Business1

• 2.7

0.2 2.0 5.5 6.1 Lending Growth 0.6 1.1 3.7 4.8 5.0 Deposit Growth Households 2.9 8.0 5.6 5.1 5.5 Note 1. Includes Rural Sources: RBNZ (2010 actual); ANZ forecasts (2011-14), finalised February 2011

System Forecasts (Registered Banks)

Forecast

New Zealand Region

61

(Pro forma)

Net Profit After Tax

1. Excludes contribution from Shareholder‟s Functions, Operations and Support

1H11 Profit Before Provisions

Contribution by Business1

24% 50% 3% 23% Retail Commercial Wealth Institutional

1H11 NPAT

Contribution by Business1

22% 47% 4% 27%

Retail Commercial Wealth Institutional 643 884 374 510 605 100 200 300 400 500 600 700 800 900 1,000 FY09 FY10 1H10 2H10 1H11 (NZD m)

• Momentum moderated by de-leveraging across the market
• Demand for credit subdued with revenue growth assisted by

continued switching of fixed rate to variable rate lending – fixed rate now 46% of mortgage book versus 68% same time last year

• Expenses well managed with cost to income ratio reduced to

44.8%, down from 49.0% at 2H10

• Operational efficiencies, improved service levels and business
• utcomes are expected from the move to a single banking technology

platform and simplified regional management structure

New Zealand Region

Pro forma NPAT movement – 1H11 v 2H10 Financial performance has continued to improve with recovery in the New Zealand economy

62

4% 6% HOH PCP Revenue

• 5%

2% HOH PCP

Expenses

19% 62% HOH PCP

Net Profit after Tax

Pro forma Growth Rates

• 35%
• 74%

HOH PCP Provisions

510 605 7 59 38 46 55

2H10 Net Interest Other Income Exp. Prov. Tax and OEI 1H11

NZDm

New Zealand Region – Key drivers of performance

63

Revenue & expense growth Pro forma NPAT Contribution

1% 2% 4% 6%

• 5%

7%

• 5%

2% 1H10 2H10 1H11 (HoH) 1H11 (PCP) Revenue Expenses

Provision charges

496 147 374 510 605 1H09 2H09 1H10 2H10 1H11

NZDm

Retail & Wealth Commercial Institutional Other 291 599 330 131 85 1H09 2H09 1H10 2H10 1H11

NZDm

Retail & Wealth Commercial Institutional Other

New Zealand Businesses

Pro forma NPAT movement – 1H11 v 2H10 Pro forma NPAT movement – 1H11 v 1H10

64

376 453

• 22

7 30 67 35

2H10 Net Interest Other Income Exp. Prov. Tax and OEI 1H11 NZDm 1% 7% HOH PCP Revenue

• 4%

Flat HOH PCP

Expenses

20% Large

HOH PCP

Net Profit after Tax

Pro forma Growth Rates

• 41%
• 72%

HOH PCP

Provisions 218 453

• 102

8 2 253 110

1H10 Net Interest Other Income Exp. Prov. Tax and OEI 1H11 NZDm

New Zealand Businesses – Revenue composition

65

NZ Businesses Pro forma Revenue Composition (NZDm) Mortgage portfolio composition Mortgage portfolio repricing profile % of portfolio repriced

1.95% 2.00% 2.05% 2.10% 2.15% 2.20% 2.25% 2.30% 2.35% 2.40% 2.45% 2.50% 200 400 600 800 1,000 1,200 1,400 1,600 1H09 2H09 1H10 2H10 1H11 NZDm

NII (LHS) Other operating income (LHS) NZ Bus NIM (RHS)

77% 77% 68% 58% 46% 23% 23% 32% 42% 54% 0% 20% 40% 60% 80% 100% 1H09 2H09 1H10 2H10 1H11

% Fixed % Variable

40% 73% 88% 97% 100% 0% 20% 40% 60% 80% 100% FY09 FY10 FY11 FY12 FY13

New Zealand – Retail & Wealth

• Strong NPAT growth driven by significant decline in provisions both HoH and PCP
• Revenue has absorbed ~1% PCP impact of exception fee reductions effective 1st

December 2009

• Expenses well managed down 4% HoH
• Share of new mortgage business increasing in <80% LVR market
• The ongoing repricing of the Fixed Mortgage book estimated 73% complete at FY10

with a further 15% to reprice during FY11

• Integration of OnePath into Wealth business progressing well - 20% share of new

life risk business for the March quarter, market-leading KiwiSaver provided with $1.95b FUM and 24% market share

Well managed business in a subdued economy

66

1% 4% HOH PCP Revenue

• 4%

4% HOH PCP

Expenses

31% 38% HOH PCP

Net Profit after Tax

Pro forma Growth Rates

• 46%
• 63%

HOH PCP Provisions

Changes to fees and launching market leading products has restored customer growth

1,170 1,175 1,180 1,185 1,190 1,195 1,200 1,205 1,210 Jun 08 Sep 08 Dec 08 Mar 09 Jun 09 Sep 09 Dec 09 Mar 10 Jun 10 Sep 10 Dec 10

Thousands

Main Bank Customers (Seasonally Adjusted)

ANZ brand customer satisfaction at historic highs1

• 1. Nielsen CFM survey

85% 85% 89% 0% 20% 40% 60% 80% 100% 1Q09 1Q10 1Q11

New Zealand – Commercial & Agri

• New Zealand Commercial business now comprises of Commercial

division, Agri division and Business Banking

• Guiding customers through the current challenging economic cycle via

customer learning forums

• Super Regional strategy continues to support New Zealand business‟

regional growth aspirations, e.g. Transactive platform enables seamless Trans-Tasman banking; first Australasian bank to complete Chinese RMB deal

• Reduction in lending due to increased Fonterra payouts, and continued

debt reduction in market

• Maintaining good cost management disciplines

Successful consolidation of the Agri division into Commercial division now better placed to support customers growth

67

1% 9% HOH PCP

Revenue

Flat

• 4%

HOH PCP

Expenses

12% Large

HOH PCP

Net Profit after Tax

Pro forma Growth Rates1

• 38%
• 75%

HOH PCP Provisions

Activity Outlook Index2 Dairy Milk Payout/Price3

• 40
• 30
• 20
• 10

10 20 30 40 50 60

Mar-08 May-08 Jul-08 Sep-08 Nov-08 Jan-09 Mar-09 May-09 Jul-09 Sep-09 Nov-09 Jan-10 Mar-10 May-10 Jul-10 Sep-10 Nov-10 Jan-11 Mar-11

Total Agriculture Manufacturing

1 Growth rates reflect total Commercial i.e. includes the combination Commercial and Agri and Business Banking divisions 2 National Bank Business Outlook March 2011

• 3. ANZ National Bank

0.0 2.0 4.0 6.0 8.0 Oct 02 Oct 03 Oct 04 Oct 05 Oct 06 Oct 07 Oct 08 Oct 09 Oct 10

$ per kg MS.

32% 21% 20% 15%

ANZ/NBNZ Peer 1 Peer 2 Peer 3

New Zealand – Business Banking

68

• FUM and revenue growth solid in a subdued market
• Strong NPAT growth and a significant decline in provisions evident in the HoH and PCP outcomes
• Investment in frontline roles to grow the business has been managed through other cost

savings, leaving expenses largely flat

• Customer Satisfaction has improved across both Brands in the last 6 months1

Establishment of a standalone specialist business bringing a new level of focus to managing small business customers One third of the SME market in NZ has a banking relationship with ANZ1

• 1. Source: TNS Conversa

100,200 100,400 100,600 100,800 101,000 101,200 101,400 101,600 Sep 10 Oct 10 Nov 10 Dec 10 Jan 11 Feb 11

Business Banking has seen steady growth in customer numbers over the half year

New Zealand – Institutional

• Extended position as clear market leader, outstanding results across 5 Peter Lee

Associate surveys

• First half revenue growth reflects strong Markets result. Growth against 1H10 impacted

by lower contribution from the management of interest rate risks in the Bank‟s balance sheet

• Expenses flat HoH. Cost growth of 16% PCP driven by investment in systems

supporting the Super Regional strategy

• Connecting customers to Asia and demonstrating ANZ regional capability, e.g. first

Australasian bank to complete a Chinese RMB denominated trade settlement deal; implemented full local payments and cash management for NZ customer's China

• perations
• Market leading innovative client solutions, e.g. only domestic bank to structure Export

Credit Agency Funding; extended commodities capability; launched Transactive, the

• nly full capability web based Tran-Tasman cash management and payment system to

be offered by an Australasian bank

ANZ continues to dominate the NZ institutional segment

69

13%

• 7%

HOH PCP Revenue

• 1%

16% HOH PCP

Expenses

5%

• 17%

HOH PCP

Net Profit after Tax

Pro forma Growth Rates

• 62%
• 38%

HOH PCP Provisions

598 531 517 449 426 ANZ Peer 1 Peer 2 Peer 3 Peer 4

Relationship Strength1

(Relationship Strength Index 2010)

Sources: 1: Peter Lee Associates Large Corporate and Institutional Relationship Banking New Zealand Survey 2010

Most Trusted Adviser1

(% Total Customers)

54% 42% 29% 16% 8% 12% ANZ Peer 1 Peer 2 Peer 3 Peer 4 Peer 5

Global Institutional

• Growing our client base and diversifying our geographic

mix:

• Brought on 676 new Institutional, Corporate and Financial

Institutions clients in the past half, a 10% increase HOH

• ANZ recognised as “One of the Fastest-growing corporate

banks in Asia” in the Greenwich Associates‟ 2011 Large Corporate Banking Survey

• 28% of total lending now in APEA, up from 21% in 2009
• Investing in support infrastructure:
• ANZ Transactive Trans-Tasman cash management platform

launched, with Singapore and Hong Kong on-line later this year – 3,241 client sites activated for ANZ Transactive in Australia and New Zealand

• New capabilities have been introduced including new FX

liquidity and rates platforms

• Core Market Risk and Credit Risk capabilities are in the

process of being enhanced

• Strengthening our relationships:
• Further strengthened our position in Australia and New

Zealand relationships as measured by Peter Lee Associates1

• Making progress in our priority sectors of

resources, agriculture and infrastructure:

• Lead Arranger and book-runner for Woodside‟s $1bn

Syndicated Term Loan Facility

• Sole arranger of AUD475m Emerald grain repurchase

syndication

Making Clear Progress on our Strategy Growing connectivity driven revenue Growing and diversifying regional client base

70

78% 22%

Cross border revenues up 10% PCP Cross Border Domestic Booked 16% 60% 4% 20%

Geographic Mix of new clients won past 12 months Australia

Asia New Zealand Europe & America

• 1. Based on ANZ‟s Relationship Strength Index scores in the Peter Lee Associates Large Corporate and Institutional

Relationship Banking Survey – Australia and New Zealand 2009 and 2010.

Global Institutional – Financial Performance

Pro forma NPAT movement – 1H11 v 2H10

71

Pro forma NPAT movement – 1H11 v 1H10

4% 7% HOH PCP

Revenue

8% 20% HOH PCP

Expenses

12% 26% HOH PCP

Net Profit after Tax

Pro forma Growth Rates

• 50%
• 65%

HOH PCP

Provisions 914 1,028 102

203 71 156 72

2H10 Net Interest Other Income Exp. Prov. Tax and OEI 1H11

$m 816 1,028 19 198 166 280 81

1H10 Net Interest Other Income Exp. Prov. Tax and OEI 1H11

$m (65%) (50%)

Global Institutional – Performance by Geography

Pro forma PBP movement - 1H11 v 2H10

72

Pro forma PBP movement - 1H11 v 1H10

• 4%

30% 13% Australia APEA New Zealand

Revenue

Pro forma Growth Rates 1H11 v 2H10

• 9%

48% 19% Australia APEA New Zealand

PBP 1,561 1,591 104 108

26

2H10 Australia APEA New Zealand 1H11

AUDm 1,578 1,591 17 59 29

1H10 Australia APEA New Zealand 1H11

AUDm

10% 28% 5% Australia APEA New Zealand

NPAT

Global Institutional – Performance by Business

Pro forma PBP movement – 1H11 v 2H10

73

Pro forma PBP movement – 1H11 v 1H10

4% 0% 12%

Global Loans Transaction Banking Global Markets

Revenue

Pro forma Growth Rates 1H11 v 2H10

1,561 1,591 24 29 67 32

2H10 Global Loans Transaction Banking Global Markets Other 1H11

$m

36%

• 16%

28% Global Loans Transaction Banking Global Markets

NPAT

3%

• 8%

14% Global Loans Transaction Banking Global Markets

PBP 1,578 1,591 50 69 82 24

1H10 Global Loans Transaction Banking Global Markets Other 1H11

$m

Impacted by one-off interest write back 2H10

• 200

200 400 600 800 1000 1200 1400 1H08 2H08 1H09 2H09 1H10 2H10 1H11 $m

Other Capital Markets Foreign Exchange Fixed Income

Global Markets – Performance by Product

Revenue Contribution by Product

• Continued focus on growing global customer flows, risk management

and diversifying product revenues across the regions

• Investment in FX and Commodities businesses delivering real revenue

momentum, further supported by upward trends in commodity prices

• Capital Markets deal flow continues to strengthen across the entire

Asia Pacific region

• Fixed income captured increased share of key markets, including a

record deal in Japan, the largest Corporate Sales deal for ANZ in Asia

74

8%

• 2%

HOH PCP

Total Revenue

12%

• 18%

HOH PCP

Fixed Income

6%

• 10%

HOH PCP

Capital Markets

Revenue Growth

23% 21% HOH PCP

FX & Commodities 43% 31% 12% 14%

Global Markets – Performance by Geography

Revenue Contribution by Geography

• Results highlight continuing success of strategic initiatives aimed at

diversifying revenue streams across geographies

• Targeted investment in APEA has driven 1H11 growth of 30% with

42% growth in Asia

75

(4%) (7%) HOH PCP

Australia

30% 16% HOH PCP

APEA

Revenue Growth

19%

(20%)

HOH PCP

New Zealand

200 400 600 800 1,000 1,200 1,400 1H08 2H08 1H09 2H09 1H10 2H10 1H11

$m

Australia APEA New Zealand

53% 35% 12% (20%)

Transaction Banking

ANZ Transactive

Monthly Transaction Volumes

• Effective working capital and liquidity

management is central to any client‟s core banking relationship

• ANZ Transactive monthly transaction volumes

up 27% HOH

• Launched trans-tasman cash management

functionality during half – the first integrated cash management platform across Australia and NZ

• ANZ Transactive Asia also launched into eight

Asian countries during the half, and currently has 2,599 registered clients

Payments & Cash Management

• Total Trade assets are up 30% in Asia

compared to March 2010.

• ANZ again awarded best trade bank in Australia

by Global Finance, Insto and Global Trade Review magazines

• Also recognised as one of the Top 5 trade banks

in the Asia Pacific region

• Structured Trade Finance team recently

completed a AUD475M Syndicated Warehouse Finance Repurchase Facility - the first ever in the global market place

Trade & Supply Chain

76

1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 500,000 1,000,000 1,500,000 2,000,000 2,500,000 Nov-09 May-10 Nov-10 Australia (LHS) Asia (RHS)

5 10 15 20 25 30 35 1H10 2H10 1H11 AUDb Asia Australia NZ E&A

Total Trade Exposures

Funded & Unfunded

11

HALF YEAR RESULTS

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED

3 May 2011

Investor Discussion Pack

Treasury

8.5% 8.0% 8.5% ~11.8% 10.7% 10.1% 10.5% ~7.4% ~7.0% ~7.7% ~8.3% ~8.5% ~9.5% ~9.5% ~14.1% 13.0% 11.9% 12.1% ~15.5%

Mar-10 Sep-10 Mar-11 Core Tier-1 Deduction (Insur,banking assoc,ELvEP) Higher RWA Charges (market & credit risk, securitisation)* 10%/15% threshold insur,assoc, DTA Dividend accrual,net capitalised expenses+ DTA incl. in EL v EP deduction+ RWA: IRRBB & mortgage LGDs Mar-11 Basel III Core Tier-1 Ratio FSA Mar-11

Full alignment to Basel ~ +250bps Additional Basel 3 requirements ~ -150bps

Minimum Target: 4.5%

Core Tier 1 surplus

• ver

7.0% Capital Buffer 2.5% Minimum Target 4.5%

ANZ well capitalised and positioned to manage transition to Basel III

Basel II Basel III – Core Tier 1

*excludes impact of BIII liquidity reforms in RWA +includes increase in 10% threshold insurance & associates

Core Tier 1 Tier-1 Total 78

8.05 1.06 (0.37) (0.09) (0.09) (0.07) 8.49 ~9.5 ~11.8

Sep-10 NPAT(1) Dividend/ DRP(2) RWA movement(3) Other(4) Investments Mar-11 Mar-11 Basel III Mar-11 FSA

Solid organic capital generation underpins strong Core Tier-1 position

• 1. Underlying NPAT. 2. Includes prior period under-accrual of DRP . 3.Includes impact of movement in Expected Loss versus Eligible Provision
• excess. 4. Includes OnePath Insurance Business, Asian Banking Associates, Non-Core NPAT items, Capitalised Costs and Software, FX, Net

Deferred Tax Assets, Pensions, MTM gains on own name included in profit

Capital Position (Core Tier-1 Ratio)

Portfolio Growth & mix: 15bp decrease Risk Migration: 7bp increase Non credit RWA: 1bp decrease

net organic up 51bp up 44bp

79

• 1. Underlying NPAT. 2. Includes prior period under-accrual of DRP . 3.Includes impact of movement in Expected Loss versus Eligible Provision
• excess. 4. Includes OnePath Insurance Business, Asian Banking Associates, Non-Core NPAT items, Capitalised Costs and Software, FX, Net

Deferred Tax Assets, Pensions, MTM gains on own name included in profit. 5. Includes 10% reduction in hybrid Tier-1 volumes.

Tier-1 position continues to strengthen with solid

• rganic capital generation

Capital Position (Tier-1 Ratio)

10.10 1.06 ~11.3 (0.37) (0.11) (0.10) (0.07) 10.51 ~14.1

Sep-10 NPAT(1) Dividend/ DRP(2) RWA movement(3) Other(4) Investments Mar-11 Mar-11 Basel III(5) Mar-11 FSA

Portfolio growth & mix: 18bp decrease Risk Migration: 8bp increase Non credit RWA: 1bp decrease

net organic up 48bp up 41bp

80

Reconciliation of ANZ’s capital position to FSA Basel 2 guidelines

• 1. Other includes Net Deferred Tax Assets, Capitalised Expenses, Deferred Income and roundings.

APRA regulations are more conservative than current FSA regulations, in that APRA requires:

• A 20% Loss Given Default floor for mortgages (FSA: 10% floor)
• Interest Rate Risk in the Banking Book (IRRBB) included in Pillar I risks (FSA: Pillar II)
• Capital deductions for investments in funds management subsidiaries (FSA: RWA assets)
• Insurance subsidiaries to be a mixture of Tier 1 and Tier 2 deductions (FSA: transitional regulations permit Total Capital

deductions under certain circumstances)

• Expected dividend payments (net of dividend reinvestments) to be deducted from Tier-1 (FSA: no deduction)
• Collective Provision to be net of tax when calculating EL v EP deduction (FSA: tax effect difference between EL and EP on

gross basis)

• Associates to be a mixture of Tier-1 and Tier-2 deductions (FSA: permits proportional consolidation under certain

circumstances)

81

Core Tier-1 Tier 1 Total Capital Mar-11 under APRA standards 8.5% 10.5% 12.1% RWA (Mortgages, IRRBB) 1.4% 1.6% 1.8% OnePath Funds Management and Life Co. businesses 0.9% 0.9% 0.3% Interim dividend accrued net of DRP & BOP 0.4% 0.4% 0.4% Expected Losses v Eligible Provision 0.2% 0.2% 0.3% Insurance subsidiaries (excluding OnePath businesses) 0.2% 0.2% 0.0% Investment in associates 0.2% 0.2% 0.4% Other1 0.0% 0.1% 0.2% Total adjustments 3.3% 3.6% 3.4% Mar-11 FSA equivalent ratio 11.8% 14.1% 15.5%

0.0 5.0 10.0 15.0 20.0 25.0 30.0 FY08 FY09 FY10 FY11 YTD FY 11 FY12 FY13 FY14 FY15+ Senior Debt Government Guarantee Subordinated Debt Pre funded in FY10

1 Excludes perpetual debt

0.0 20.0 40.0 60.0 80.0 100.0 120.0 140.0 Sep 05 Sep 06 Sep 07 Sep 08 Sep 09 Sep 10 Sep 11 Sep 12 Sep 13 Sep 14 Bps

Stable term debt issuance, portfolio costs continue to increase

Stable term funding profile – FY11 issuance ahead of schedule (~70% complete)

Issuance Maturities

Portfolio term funding costs continue to increase as pre 2008 debt reprices

1

Future Repricing

82

7% 8% 8% 8% 50% 55% 58% 60% 14% 15% 16% 15% 7% 5% 6% 6% 22% 17% 12% 11% Sep 08 Sep 09 Sep 10 Mar 11

ANZ’s has a well diversified and improved funding profile

Strong Funding Composition

Short Term Wholesale Funding Term Debt < 1 year Residual Maturity Term Debt > 1 year Residual Maturity Customer Funding Shareholders equity & Hybrid debt

Minimal offshore short-term wholesale funding; Offshore CP accounts for <2% (~$8.6b)

Equity/ Hybrids 8%

6% 2% 1% 2% Gross Interbank, Other APEA CDs Offshore CP Domestic CDs

11%

6% 5% 4% 2% 4% Offshore PPs (Multi ccy

• incl. HKD,SGD,RMB)

Japan (¥) UK & Europe (€,£,CHF) North America (USD, CAD) Domestic (AUD, NZD)

21%

Well diversified term wholesale funding portfolio

83

Solid Liquidity position however B3 liquidity requirements remain uncertain

Strong liquidity position ($b)

34.7 60.2 66.7 67.0 31.1 3.2 7.8 6.2 5.0 7.7 28.2

Sep 08 Sep 09 Sep 10 Mar 11 Mar 11

Recent Basel III Developments

• The implementation of the new B3 liquidity

requirements remains subject to consultation and clarification

• Key Definitions including Financial Institutions

and Operational Deposits remain outstanding and are likely to be clarified by APRA later in 2011

• Given the lack of eligible liquid assets in

Australia, APRA will allow banks to meet their LCR requirements through a committed liquidity facility at the RBA backed by repo eligible stock

• The banks will pay a fee for this facility in line

with cost of holding B3 eligible liquid assets

Timing / Next steps

• Extended transition period with

implementation of the LCR expected in 2015

• Final quantum of the LCR shortfall will

depend on exact definitions adopted and product innovation and development during the transition period

• Expected NSFR implementation in 2018

Class 1 – AAA & Cash Class 2 – AA or better Class 3 – Internal RMBS

84

Prime Liquidity Portfolio Other Eligible Securities

• Hedge profits partially mitigated the impact of

AUD strength on 1H11 earnings

• For 2H11, hedges are in place to cover ~60% of

NZD, USD and other significant currencies - each 5% appreciation of the AUD negatively impacts FY11 EPS by ~0.3%

• FY12 FX headwind estimated to be ~1%, with

~60% of USD and other significant currency exposures hedged at an equivalent AUD/USD rate of 0.97, however only modest NZD hedges in place

Foreign Exchange impacts

Earnings Composition by Region & Average Translation Rates

0.60 0.70 0.80 0.90 1.00 1.10 1.20 1.30 1.40 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2H09 1H10 2H10 1H11

% Group Underlying Profit

APEA (LHS) New Zealand (LHS) Australia (LHS) AVG AUD/USD (RHS) AVG AUD/NZD (RHS) (1.9%) ~(1.5%) (2.5%) ~(3.1%) 1H11 HoH FY11 PCP @Current rates

Current Hedging Unhedged

EPS Impact

85

11

HALF YEAR RESULTS

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED

3 May 2011

Investor Discussion Pack

Risk Management

• 200

200 400 600 800 1,000 1,200 1,400 1,600 1,800 1H09 2H09 1H10 2H10 1H11

$m

Institutional Australia Division NZ Businesses APEA ex-Institutional CP charge 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 1H09 2H09 1H10 2H10 1H11

$m

Provision Charge and Impaired Assets

New Impaired Assets by Division Total Provision Charge (IP charge by Division, total CP charge)

87

1,435 1,621 1,098 722 660 3,035 3,600 3,126 2,319 2,437 Oswal

Individual Provision Charge

200 400 600 800 1,000 1,200 1,400 1,600 1,800 2,000 1H09 2H09 1H10 2H10 1H11 $m Institutional Commercial Consumer

Individual Provision Charge by Segment Individual Provision Charge composition Individual Provision Charge by Region

88

1,531 1,283 1,062 762 594

• 500

500 1,000 1,500 2,000 1H09 2H09 1H10 2H10 1H11 $m New Increased Writebacks & Recoveries 500 1,000 1,500 2,000 1H09 2H09 1H10 2H10 1H11 $m Australia New Zealand APEA 1,531 1,283 1,062 762 594 1,531 1,283 1,062 762 594

• 400
• 300
• 200
• 100

100 200 300 400 500 1H09 2H09 1H10 2H10 1H11

$m Lending Growth Economic Cycle & Concentration Risk Profile Portfolio Mix

Collective Provision Charge

89

Total Group Australia Division New Zealand Businesses Global Institutional APEA (ex-Inst.) 66 116 (46) 5 (9)

60 79

• 19

56 16

• 1

29 12

• 34

21

• 26
• 9
• 20
• 16
• 15
• 1

Collective Provision Charge by Source

Credit Risk Weighted Assets

Total Credit Risk Weighted Assets

90

233.5 233.2 4.6 0.1 3.7 1.1

Sep 10 Growth Data Review FX Impact Risk Mar 11

$b 257.8 229.8 220.4 233.5 233.2

Mar 09 Sep 09 Mar 10 Sep 10 Mar 11

$b

Credit RWA movement 1H11

Impaired Assets

Gross Impaired Assets by Type Gross Impaired Assets by Size of Exposure New Impaired Assets by Segment

91

1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 Mar 09 Sep 09 Mar 10 Sep 10 Mar 11

$m

Impaired Loans NPCCD Restructured 2,000 4,000 6,000 8,000 Mar 09 Sep 09 Mar 10 Sep 10 Mar 11

$m

> $100m $10-$99m < $10m 1,000 2,000 3,000 4,000 1H09 2H09 1H10 2H10 1H11

$m

Institutional Commercial Retail 3,035 3,600 3,126 2,319 2,437 4,158 5,595 6,561 6,561 6,221 4,158 5,595 6,561 6,561 6,221

Oswal Oswal

Watch & Control Lists and Risk Grade Profiles

Group Risk Grade profile by Exposure at Default Watch & Control List

92

59% 59% 58% 60% 13% 13% 14% 14% 13% 13% 13% 12% 9% 9% 9% 8% 6% 6% 6% 6% Sep 09 Mar 10 Sep 10 Mar 11 AAA to BBB BBB- BB+ to BB BB- >BB-

20 40 60 80 100 120 140 160 180

Mar 09 Sep 09 Mar 10 Sep 10 Mar 11

Index Mar 2009 = 100

Watch List by Limits Watch List by No. Groups Control List by Limits Control List by No. Groups

Commercial Industry Exposures

93

Finance & Insurance Property Services Manufacturing

0% 2% 4% 6% 8% 10% 12% 14% 20 40 60 80 Mar 10 Sep 10 Mar 11

Exposure at Default ($b) (LHS) % of Group Portfolio (RHS) % in Non-Performing (RHS)

Agri, Forestry & Fishing Wholesale Trade Other Commercial Exposures

0% 2% 4% 6% 8% 10% 12% 14% 20 40 60 80 Mar 10 Sep 10 Mar 11 0% 2% 4% 6% 8% 10% 12% 14% 20 40 60 80 Mar 10 Sep 10 Mar 11 0% 2% 4% 6% 8% 10% 12% 14% 20 40 60 80 Mar 10 Sep 10 Mar 11 0% 2% 4% 6% 8% 10% 12% 14% 20 40 60 80 Mar 10 Sep 10 Mar 11 0% 4% 8% 12% 16% 20% 24% 20 40 60 80 100 120 Mar 10 Sep 10 Mar 11

Australia 90+ Day Delinquencies

0.00% 0.50% 1.00% 1.50%

Sep 07 Sep 08 Sep 09 Sep 10

Total Mortgage Portfolio NSW & ACT Mortgages QLD Mortgages VIC Mortgages WA Mortgages Total Credit Cards

Australia Retail

90+ day delinquencies

94

Mortgages have low loss rates

Individual Provision Loss Rates

1H09 2H09 1H10 2H10 1H11 Group

0.85% 0.74% 0.61% 0.42% 0.31%

Australia Region

1.03% 0.72% 0.59% 0.42% 0.31%

Australia Mortgages

0.03% 0.02% 0.02% 0.01% 0.01%

Australia Division 90+ day Delinquency Balance ($m)

500 1,000 1,500 2,000 Mar 10 Sep 10 Mar 11 Mortgages Other Lending

Australia Mortgages

Dynamic Loan to Valuation Ratio

95

0% 10% 20% 30% 40% 50% 60%

0-60% 61-75% 76-80% 81%-90% 91%+

% Portfolio

Mar 10 Sep 10 Mar 11

Portfolio Statistics

Total Number of Mortgage Accounts 831k Total Mortgage FUM $165b % of Total Australian Lending 59% % of Total Group Lending 44% Owner occupied loans - % of portfolio 64% Average Loan Size at Origination $227k Average LVR at Origination 63% Average Dynamic LVR of Portfolio 47% % of Portfolio Ahead on Repayments 38% First Home Owners – % of Portfolio 11% First Home Owners – % of New lending 1H11 7%

10% of Portfolio >80% LVR

Mortgage Portfolio by State (Mar 2011) 27% 20% 27% 16% 10%

NSW & ACT QLD VIC WA OTHER

Australia Commercial

Australia Commercial 90+ day delinquencies Regional Commercial Banking 90+ day delinquencies

96

0.00% 0.50% 1.00% 1.50% 2.00% 2.50% 3.00%

Sep-07 Sep-08 Sep-09 Sep-10 Business Banking Regional Commercial Banking Esanda Small Business Banking

Australia Commercial Lending Mix 33% 29% 31% 7%

Business Banking Regional Commercial Banking Esanda Small Business Banking 0.00% 0.50% 1.00% 1.50% 2.00% 2.50% 3.00%

Jan-10 May-10 Sep-10 Jan-11

RCB Total Agri Other Commercial

The Queensland economy was already facing challenges before the onset of natural disasters

Unemployment did not experience the level of decline experienced in the national average Tourism flows have been declining impacted by a strong AUD Mining is a key driver of economy but less significant than in WA

97

14% 30%

QLD WA

Mining as % of Total Industry 3.0 4.0 5.0 6.0 7.0 8.0 9.0 2001 2003 2005 2007 2009 2011 Level of unemployment

Australia Queensland

0.40 0.50 0.60 0.70 0.80 0.90 1.00 1.10

• 2,000
• 1,000
• 1,000

2,000

2000 2002 2004 2006 2008 2010

AUD/USD Inverted Net Tourism Annual Rolling Sum („000)

Net Tourism (lhs) AUD/USD (rhs)

%

New Zealand

Total Impaired Assets Total Provision Charge 90+ Days Arrears

98

0.00% 0.40% 0.80% 1.20% 2007 2008 2009 2010 2011 Mortgages Commercial Rural

• 200

200 400 600 800 1H09 2H09 1H10 2H10 1H11

NZDm

IP Charge CP Charge 639 1,220 1,837 2,079 2,236 0.64% 1.24% 1.89% 2.13% 2.31%

Mar 09 Sep 09 Mar 10 Sep 10 Mar 10 NZDm Impaired Assets IA as % GLA

291 598 330 131 85

Credit Intermediation Trades

99

Position as at 31 Mar 2011 Counterparty Rating No. Notional purchased protection principal amount (USDm) Mark to Market (USDm) Life to Date Notional Principal Amount on corresponding Sold Protection (USDm) Credit Risk

• n

Derivatives (USDm) Credit Risk

• n

Derivatives (AUDm) AA+/Aa3 2 2,010 204 46 44 1,522 BB/Ba1 1 3,100 94 48 47 3,100 Withdrawn Rating / No rating 3 3,778 160 54 52 3,778 Defaulted Monoline1

• Other costs2
• 295

318 Position 31 March 2011 6 8,888 458 443 461 8,400 Position 30 September 2010 6 9,879 620 488 515 8,414

• 1. The last bought protection trade from the defaulted monoline matured in September 2010.
• 2. Other costs are cumulative life to date costs which include realised losses relating to restructuring trades to reduce risks which were unhedged due to

default by the purchased protection counterparty and realised losses on termination of sold protection trades. It also includes foreign exchange hedging losses.

• Cumulative Credit Risk on Derivative expense for the Credit

Intermediation Trade portfolio as at 31/3/2011 was $461m (down $55m from 30/9/2010)

• Credit markets have shown a tightening bias over the past

six months despite periods of volatility. The relative stability in credit markets and the reduced level of credit exposure

• utstanding has resulted in lower MTM and CVA over the

past 6 months

• However, MtM and CVA remain subject to volatility in

both credit spreads and exchange rates

• The level of sold protection was relatively unchanged with no

trades exited during HY11. The total notional value of the sold protection outstanding was USD 8,400m (30/9/10 USD 8,414m).

• ANZ will look at opportunities which may arise to reduce our

remaining sold protection exposure.

• ANZ has strong levels of protection under the sold protection

trades with an average attachment point of

• ~ 15% for the 12 CDO‟s
• ~ 36% for the 6 CLO‟s
• ANZ has USD 8,888m in bought protection outstanding

including approximately USD 0.49bn of bought protection for which ANZ has no remaining underlying sold protection exposure.

• The notional face value of bought protection reduced by

approximately USD1bn with one trade maturing during HY11.

Credit Intermediation Trade Portfolio

100

Credit Intermediation Trades

0.00 2.00 4.00 6.00 8.00 10.00 12.00 0.00 0.50 1.00 1.50 2.00 2.50 3.00 3.50 Sep 08 Mar 09 Sep 09 Mar 10 Sep 10 Mar 11 USDb AUDb Mark to Market AUD (LHS) Credit Valuation Adjustment AUD (LHS) Notional Sold Exposure USD (RHS)

11

HALF YEAR RESULTS

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED

3 May 2011

Investor Discussion Pack

Economic Updates

Australia New Zealand

2009 2010 2011 2012 2009 2010 2011 2012

GDP 0.9 2.7 1.7 4.0

• 2.8

1.3 0.4 4.0 Inflation 1.3 2.8 2.9 2.6 1.7 1.5 5.01 2.7 Unemployment 5.8 5.2 5.0 4.5 6.5 6.4 6.6 6.1 Cash rate 3.00 4.50 5.00 5.75 2.50 3.00 2.50 3.75 AUD/USD 0.88 0.97 1.05 0.98 N/A N/A N/A N/A Credit 1.7 3.2 4.3 5.2 3.6 0.6 1.1 3.7

• Housing

7.6 7.9 6.6 6.5 3.9 3.0 1.7 4.8

• Business2
• 4.6
• 3.7

0.1 4.0 3.6

• 2.7

0.2 2.0

• Other
• 5.5

2.7 4.7 5.0

• 1.8

2.2 4.2 4.0

Economic updates

102 Source - ANZ economics team estimates. Based on 30 September bank year. Growth rates in through the year terms.

• 1. Impacted by an increase in the Goods and Services tax rate from 12.5% to 15% effective 1 October 2010
• 2. NZ Business includes Rural lending

Growth Forecasts – Asia

103 Note: Based on calendar year.

Emerging Asia GDP Growth Forecasts

2007 2008 2009 2010 2011 2012

China 13.0 9.6 9.1 10.3 9.5 9.5 India 9.5 7.3 6.8 8.6 8.9 9.8 NIEs Hong Kong 6.4 2.4

• 2.8

6.5 5.0 5.2 Korea 5.1 2.3 0.2 6.1 3.9 4.7 Singapore 8.5 1.8

• 1.3

14.5 4.6 5.5 Taiwan 5.9 1.1

• 1.9

11.0 5.3 3.5 ASEAN Indonesia 6.4 6.0 4.5 6.1 6.2 6.5 Malaysia 6.5 4.7

• 1.7

7.2 5.1 5.9 Philippines 7.1 3.7 1.1 7.3 5.9 6.0 Thailand 5.0 2.5

• 2.3

7.8 4.4 5.5 Vietnam 8.5 6.3 5.3 6.8 6.4 6.6 Total 10.3 7.3 6.1 9.2 8.1 8.3 Total (ex. China & India) 6.1 3.3 0.4 7.6 5.0 5.3 Sources: CEIC, ANZ Economics.

The material in this presentation is general background information about the Bank‟s activities current at the date of the presentation. It is information given in summary form and does not purport to be complete. It is not intended to be relied upon as advice to investors or potential investors and does not take into account the investment objectives, financial situation or needs of any particular investor. These should be considered, with or without professional advice when deciding if an investment is appropriate This presentation may contain forward-looking statements including statements regarding our intent, belief

• r current expectations with respect to ANZ‟s business and operations, market conditions, results of
• perations and financial condition, capital adequacy, specific provisions and risk management practices.

When used in this presentation, the words “estimate”, “project”, “intend”, “anticipate”, “believe”, “expect”, “should” and similar expressions, as they relate to ANZ and its management, are intended to identify forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. Such statements constitute “forward-looking statements” for the purposes of the United States Private Securities Litigation Reform Act of 1995. ANZ does not undertake any obligation to publicly release the result of any revisions to these forward-looking statements to reflect events or circumstances after the date hereof to reflect the occurrence of unanticipated events. For further information visit

www.anz.com

• r contact

Jill Craig Group General Manager Investor Relations ph: (613) 8654 7749 fax: (613) 8654 9977 e-mail: jill.craig@anz.com