2019 FULL YEAR RESULTS — FULL YEAR ENDED 30 SEPTEMBER 2019

R E S U LT S P R E S E N TAT I O N & I N V E S TO R D I S C U S S I O N PA C K

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2019 FULL YEAR RESULTS

CEO and CFO Results Presentations	2
CEO Presentation	2
CFO Presentation	16
Group & Divisional Financial Performance	35
Group including impact of large / notable items	36
Australia Retail & Commercial	48
Institutional	53
New Zealand Division	60
Wealth Australia	65
Treasury	67
Risk Management	78
Housing Portfolio	91
Royal Commission update & Regulatory reforms	107
Corporate Overview and Sustainability	110

All figures within this investor discussion pack are presented on Cash Profit (Continuing operations) basis in Australian Dollars unless otherwise noted. In arriving at Cash Profit, Statutory Profit has been adjusted to exclude non-core items, further information is set out on page 77-81 of the 2019 Full Year Consolidated Financial Report.

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2019 FULL YEAR RESULTS — SHAYNE ELLIOTT CHIEF EXECUTIVE OFFICER

FINANCIAL SNAPSHOT

			FY19	FY19 v FY18
Statutory Profit($m)			5,953	-7%
Cash Profit (continuing operations)1 ($m)			6,470	0%
Return on Equity			10.9%	-10bps
Earnings Per Share (cents)			228	+2%
Dividend Per Share (cents)			160	flat
Franking (FY19 avg)			85%	-15%
CET1 Ratio (APRA)			11.4%	stable
Total Capital (CET1) ($m)			47,355	+6%
Net Tangible Assets Per Share ($)			19.59	+6%
Shares on issue (end of period #m)			2,835	-1%
Risk Weighted Assets($b)			417	+7%
• Solid result in a	•	Disciplined approach to	•	Capital management driving
challenging environment		balance sheet growth		real benefits to shareholders

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Includes the impact of large / notable items

BALANCE SHEET STRENGTH

CAPITAL & CREDIT QUALITY

CET1 RATIO (LEVEL 2)

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CET1 RATIO (LEVEL 2) NET ORGANIC CAPITAL NTA PER SHARE
GENERATION
% bps $
19.59
11.4 11.5 229 [18.47]
10.6 17.13 [17.66]
9.6
179 182
165
158
Sep- Sep- Sep- Sep-19 FY16 FY17 FY18 FY19 Sep- Sep- Sep- Sep-
16 17 18 Pro- 16 17 18 19
Forma [1] Full Yr. Avg. FY12-FY18
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CREDIT QUALITY

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IEL [2 ] bps
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35
32
27
26
Sep- Sep- Sep- Sep-
16 17 18 19
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Pro-Forma includes benefits from P&I settlement of ~20bps, partially offset by reduction from AASB16 impacts (~7bps) 2. IEL = Internal Expected Loss, long run loss rate as a % of GLA

OUR PURPOSE & STRATEGY

Our Purpose is to shape a world where people and communities thrive

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Our strategy is to generate decent returns by improving the financial wellbeing of our customers , having the right people who listen, learn and adapt ; putting the best tools and insights into their hands, and focusing on those few things that add value to customers and doing them right the first time

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Targeted growth
Lower cost
Lower risk
Capital efficient

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6 POINT PLAN

FOCUSING RESOURCES TO DELIVER FOR CUSTOMERS, SHAREHOLDERS & THE COMMUNITY

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1
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Running the business well
2 Maintaining discipline within Institutional
3 Resolving our challenges in NZ
4 Investing to prepare Australia for growth
5 Driving further simplification

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6
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Building the team’s resilience and capability

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RUN THE BUSINESS WELL

AUSTRALIA RETAIL AND COMMERCIAL

Changed our management structure & team

LAUNCHED A MAJOR HOUSING MARKETING CAMPAIGN

Continuing to invest in process redesign
Refining credit policies within a prudent risk appetite
Delegating more decisions to front line
Monitoring key operational metrics

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Focusing on improving operational capacity and approval turnaround time

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RUN THE BUSINESS WELL

CUSTOMER REMEDIATION

CUMULATIVE CUSTOMER REMEDIATION CHARGE

Pre tax $m

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1,579
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928
753
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220
153
51
Mar-17 Sep-17 Mar-18 Sep-18 Mar-19 Sep-19
Continuing operations Discontinued (Wealth businesses)
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>1,000 people progressing remediation activities

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RUN THE BUSINESS WELL

IMPROVED RISK PROFILE

GROUP INTERNAL EXPECTED LOSS[1]

bps

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47
44
37
36
35 35
33
32
27
26
Sep- Sep- Sep- Sep- Sep- Sep- Sep- Sep- Sep- Sep-
10 11 12 13 14 15 16 17 18 19
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DIVISIONAL INTERNAL EXPECTED LOSS[1]

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bps
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70
60
50
40
30
20
10
0
Sep- Sep- Sep- Sep- Sep- Sep- Sep- Sep- Sep- Sep-
10 11 12 13 14 15 16 17 18 19
New Zealand Australia Retail & Commercial Institutional
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IEL = Internal Expected Loss, long run loss rate as a % of GLA

RUN THE BUSINESS WELL

MAINTAIN DISCIPLINE WITHIN INSTITUTIONAL

RISK ADJUSTED MARGINS[1,2]

EXPENSE MANAGEMENT[2]

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$m
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2.28%
2.20%
2,772
2.04% 2,661
2,575
6,135
5,566
5,458
FY17 FY18 FY19 FY17 [3] FY18 FY19
Expenses FTE #
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Institutional (ex. Markets) net interest income divided by average credit risk weighted assets 2. Continuing operations excluding large / notable items 3. FY17 has not been restated for AASB 15 impacts

CREDIT QUALITY

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$m
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757
442
265
0.1% 0.0% 0.0%
FY17 FY18 FY19
Gross impaired assets
Credit impairment charge
as a % of GLA
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RUN THE BUSINESS WELL

NEW ZEALAND

BS11 (Outsourcing Policy)

RBNZ Capital Review Paper 4

Expected to be finalised in Dec 2019

Requires all large banks in New Zealand to have compliant outsourcing arrangements by 2022

To ensure banks can continue to run, manage, and provide banking services to NZ customers on a standalone basis if required

Relates to the amount of regulatory capital required of locally incorporated banks

Impacts Group capital requirements as New Zealand is required to retain earnings & reduce dividends paid to ANZ parent entity to meet higher capital requirements

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INVESTING FOR GROWTH

GROUP INVESTMENT SPEND[1]

PREPARING FOR CHANGE

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1,403
1,234 1,218
1,179
1,153
564
430
491
410 473
839
804
743 706 727
FY15 FY16 FY17 FY18 FY19
Rest of Group
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LAST DECADE	NEXT DECADE?
Universal services Specialisation
Mass share Targeted share
One price for all Risk based pricing
Transactions Discussions
Value from branches Value from data
High system growth Low system growth
Bank competition Experience competition
Hardware Software
Waterfall Agile
More capital More compliance
Enforceable undertakings Court action
Falling credit costs Rising credit costs
Globalisation Protectionism
Financial risk Non-financial risk

Australia Retail & Commercial

Prior periods restated from previously reported information to include technology infrastructure spend, property projects and scaled agile delivery

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CAPITALISED SOFTWARE BALANCE[1]

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$b
3
2
1
0
Sep-08 Sep-10 Sep-12 Sep-14 Sep-16 Sep-18 Sep-19
ANZ Peer 3 Peer 2 Peer 1
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Source: Capitalised software balances sourced from publicly available company financials; 2019 numbers are based on the most recently disclosure financial statements

SIMPLIFICATION

$8.6b cost base, lowest since 2013
Revenue $450m higher than 2013, despite selling 23 businesses
Focused on simplifying key customer & enablement processes that represent 70% of our cost base
Improving franchise strength

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CAPABILITY

EMPLOYEE ENGAGEMENT[1]

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77
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73
72
2017 2018 2019
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93% consider ANZ’s purpose when making decisions
86% are confident ANZ treats customers fairly
86% say ANZ demonstrates respect for our employees
73% say they have access to opportunities to help them grow

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ANZ ‘My Voice’ Staff Surveys

2019 FULL YEAR RESULTS —

MICHELLE JABLKO CHIEF FINANCIAL OFFICER

OVERVIEW

CASH PROFIT[1,2]

CASH EPS[1,2]

cents

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6,809
6,487 6,470 233
228
223
FY17 FY18 FY19 FY17 FY18 FY19
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ROE[1,2]

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11.7
11.0 10.9
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FY17 FY18 FY19

CET1 RATIO (LEVEL 2)

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11.4 11.4
10.6
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Sep-17 Sep-18 Sep-19

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Cash Profit from continuing operations 2. FY17 has not been restated for AASB15 impacts

CAPITAL

APRA LEVEL 2 CET1 RATIO – CAPITAL MOVEMENT

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%
1.65
0.69
16.4%
Internationally
Comparable basis
-0.29
-0.18
-1.15 -0.18
11.44 -0.18 -0.06 ~11.5
11.36
-0.38
-60bps net RWA imposts
Includes customer remediation
impacts (continuing and
discontinuing) of -16bps and
AASB9 of -5bps
Sep-18 Net Organic Dividends Asset Share SA-CCR Operational NZ Mortgage Other net Other [1] Sep-19 Sep-19
Capital paid divestments Buy Back Risk overlay & Agri Risk RWA imposts Pro-Forma [2]
generation Weights
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Includes large / notable items affecting the FY19 cash earnings, movements in non-cash earnings, AASB9, net foreign currency translation and other items 2. Pro-Forma includes benefits from P&I settlement of ~20bps, partially offset by reduction from AASB16 impacts (~7bps)

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REGULATORY DEVELOPMENTS

IN CONSULTATION STAGE

APRA LEVEL 1 & LEVEL 2

APRA - Investments in subsidiaries (APS111)

FY19 NET ORGANIC CAPITAL SEP-19 CET1 RATIOS GENERATION

bps

RBNZ - Capital proposals
APRA - Ongoing APRA regulatory reviews[1]

RECENTLY FINALISED (IMPLEMENTING)

APRA - Limits on related party exposures (APS222)
APRA - Loss absorbing capacity (TLAC)

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165 11.4% 11.4%
~136
APRA APRA APRA
Level 2 APRA Level 2 Level 1
Level 1
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Level 1 lower than Level 2 due to ~$1.5b lower NZ dividends in 2019

Other ongoing APRA regulatory reviews potentially impacting the future capital position include: Revisions to capital framework (RWA) and Unquestionably Strong capital calibration, Transparency, Comparability and Flexibility proposals, revisions to Interest Rate Risk to the Banking Book and Market Risk.

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FINANCIAL PERFORMANCE

CASH PROFIT CONTINUING OPERATIONS

CASH PROFIT DRIVERS

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$m
79
6,487 1 131 6,470
-94
-134
-21% 0% 0% 20% -5%
FY18 Large / Notable Revenue Expenses Provisions Tax & NCI FY19
items after tax [1]
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CASH PROFIT DIVISIONAL PERFORMANCE

$m 79 6,487 151 6,470 172 14 -22 -411 Includes $79m from share of associates profit FY18 Large / Australia Institut. Markets NZ Other FY19 Notable Retail & (ex. items Comm. Markets) after tax[1]

FY19 v FY18	Australia Retail & Commercial	Institutional	NZ (NZD)
Income Expenses Cash Profit	-6% 0% -10%	5% -3% 11%	2% 5% -4%

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Details of large / notable items provided in the investor discussion pack – additional financials section

AUSTRALIA RETAIL & COMMERCIAL

INCOME EXCLUDING LARGE / NOTABLE ITEMS AND HOUSING PORTFOLIO

HOUSING PORTFOLIO[1,2]

INCOME COMPOSITION

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$b
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$m
10,165
9,575
3,238
3,114
4,807 4,768
1,590 1,524
6,927
6,461
3,217 3,244
FY18 FY19 1H19 2H19
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264 272 265
9 8 7
26
37
49
14
22
33 54
49
39
164
156
134
Sep-17 Sep-18 Sep-19
OO P&I Inv P&I OO I/O Inv I/O Equity Manager
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Retail Commercial
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Includes Non Performing Loans
The current classification of Investor vs Owner Occupier is based on ANZ’s product category, determined at origination as advised by the customer and the ongoing precision relies primarily on the customer’s obligation to advise ANZ of any change in circumstances

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AUSTRALIA RETAIL & COMMERCIAL - HOUSING MOMENTUM

IMPROVING MOMENTUM

HOME LOAN APPLICATION TREND

3 month rolling average (Index Sep 2017 = 100)

Clarity and consistency on policy and risk settings
Approval turnaround times
Industry conditions

OUTLOOK

Pick up in application volumes in 4Q19
Improved momentum into 1Q20
Faster loan amortisation in a low rate environment

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“Offer So Good”
campaign – July 2 to
August 31
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110
100
90
80
70
60
50
40
30
20
10
0
Sep- Dec- Mar- Jun- Sep- Dec- Mar- Jun- Sep-
17 17 18 18 18 18 19 19 19
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INSTITUTIONAL

INCOME CONTINUING OPERATIONS EXCLUDING LARGE / NOTABLE ITEMS

INSTITUTIONAL INCOME COMPOSITION[1]

MARKETS INCOME COMPOSITION

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$m
+5%
5,198
4,970 42
48
1,766
1,780
-4%
2,657
2,541
23
470 19
448
940 826
1,296
1,173
236 234
644 652
1,521 1,625
815 810
FY18 FY19 1H19 2H19
L&SF PCM Trade Markets Other
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$m
-1%
1,780 1,766
63 38
446
566
-12%
940
361
271 826
256 48
190
235
126
880 921
459 463
-10
FY18 FY19
1H19 2H19
Franchise Sales Franchise Trading Balance Sheet DVA [2]
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L&SF: Loans & Specialised Finance; PCM: Payments & Cash Management; Trade: Trade & Supply Chain 2. Derivative valuation adjustments

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NET INTEREST MARGIN

CONTINUING OPERATIONS

GROUP NET INTEREST MARGIN (NIM)

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bps
180
-2
1 175
-2
2
-1
172
-4 -2
-6bps impact of lower rates
-5bps
-8bps
1H19 Asset & Treasury Deposits Wholesale Assets 2H19 Markets Large / 2H19
Funding Mix Funding Cost Underlying [1] Balance Sheet Notable Items
Activities [2]
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Excluding large / notable items and Markets Balance Sheet activities
Includes the impact of growth in discretionary liquid assets and other balance sheet activities

MARGIN ENVIRONMENT

LOW RATE ENVIRONMENT

Sep-19

Sensitivity to a 25bps drop in AUD, NZD and USD interest rates Deposits & earnings on capital ~3 bps

$b ~110

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~53

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Low rate deposits <25bps

Capital (excluding intangibles) and other non interest bearing liabilities

SWITCHING FROM INTEREST ONLY TO PRINCIPAL & INTEREST

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$b
23 24
20
10 8 6 16
11
13 16 14 7 6
FY17 FY18 FY19 FY20 FY21 FY22 FY23+
Early conversions Contractual conversions Contractual (still to convert)
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BILLS/OIS SPREAD 1H19 average 48 bps
2H19 average 27 bps
bps
10 bps mvmt. in BBSW/OIS 1 bp NIM
75
60
45
30
15
0
Oct- Jan- Apr- Jul- Oct- Jan- Apr- Jan- Sep-
17 18 18 18 18 19 19 19 19
Spot 3mth Bills/OIS Spread Rolling 90 days
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EXPENSES

CONTINUING OPERATIONS EXCLUDING LARGE / NOTABLE ITEMS

FY19 EXPENSE DRIVERS

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$m
136
8,563 170 8,562
-259
-48
Includes
Includes
Personnel &
Regulatory &
Property
Compliance
productivity
$125m
(net of $160m
inflation)
-1.6%
0%
FY18 FX BAU D&A Investment FY19
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INVESTMENT SPEND

CONTINUING OPERATIONS

TOTAL INVESTMENT SPEND BY DIVISION[1]

Capex and Opex $m

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1,403
113
1,234
1,218
1,179
85 1,153 61 204
66
75
127 150
137
129 160
169
252 164
175
197
204
204
164 187
164
144
135
176
177
564
473 491
430 410
FY15 FY16 FY17 FY18 FY19
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Australia Retail & Commercial Property & Enablement Technology Infrastructure Institutional Digital, Data & Payments New Zealand

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Prior periods restated from previously reported information to include technology infrastructure spend, property projects and scaled agile delivery

INVESTMENT SPEND

CONTINUING OPERATIONS

TOTAL INVESTMENT SPEND[1]

Capex and Opex $m

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1,403
1,234 1,218
1,179
1,153
33%
70%
58% 59% 65%
67%
42% 41%
35% 30%
FY15 FY16 FY17 FY18 FY19
Investment expensed Investment capitalised
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CAPITALISED SOFTWARE BALANCE

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$m
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2,893
2,202
1,856
1,421
1,323
Sep-15 Sep-16 Sep-17 Sep-18 Sep-19
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Prior periods restated from previously reported information to include technology infrastructure spend, property projects and scaled agile delivery

CREDIT QUALITY

PROVISION CHARGE

CREDIT IMPAIRMENT CHARGE

INDIVIDUAL PROVISION CHARGE

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$m $m
1,956
1,047
892
787
554
1,199
430 343 398
0.34%
380
688 795
0.21%
0.12% 0.13%
FY16 FY17 FY18 FY19 1H16 2H16 1H17 2H17 1H18 2H18 1H19 2H19 [1]
IP Charge CP Charge CIC as % Avg. GLA New Increased Writebacks & Recoveries
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Increase to New and Increased Individual Provisions and Writebacks & Recoveries compared to prior half is largely related to the home loan portfolio in Australia Retail and Commercial following the implementation of a more market responsive collateral valuation methodology

CREDIT QUALITY

GROSS IMPAIRED ASSETS

NEW IMPAIRED ASSETS

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$b
3.17
2.38
2.14
2.03
Sep-16 Sep-17 Sep-18 Sep-19
Australia Retail & Commercial New Zealand Institutional Other
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$b
4 3.63
3.21
3
2.11 2.01
2
1
0
FY16 FY17 FY18 FY19 [1]
Australia Retail & Commercial New Zealand Institutional Other
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AUSTRALIAN HOUSING 90+ DAYS PAST DUE[2]

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%
1.2
1.1
1.0
0.9
0.8
0.7
0.6
Sep- Mar- Sep- Mar- Sep- Mar- Sep-
16 17 17 18 18 19 19
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New Impaired Assets in 2H19 includes a $167m uplift on 1H19 in Australia home loans following the implementation of revised provisioning and impairment processes (including a more market responsive collateral valuation methodology). The increase in new impairments was largely offset by the return of previously impaired Home Loan assets to a past due but not impaired status
As a % of Gross Loans and Advances. Includes Non Performing Loans. ANZ 90+ days past due calculated on a missed payment basis

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CUSTOMER REMEDIATION

TOTAL REMEDIATION - POST TAX IMPACT

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$m
559
154
377
127
405
123
72 250
40 45 53
70
1H17 2H17 1H18 2H18 1H19 2H19
Discontinued Continuing
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TOTAL REMEDIATION – P&L IMPACT

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16% 13% 18%
28%
21%
19% 41% 55%
61%
52%
43%
32%
1H18 2H18 1H19 2H19
Net interest income Other operating income Expenses
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Financial impact

$826m ($682m post tax) charge in FY19
$1,579m ($1,216m post tax) charges since 1H17

 $1,139m provisions on balance sheet at 30 Sep 2019

Progress to date[1]

Banking product & service review well progressed

 Remediation of advice & other wealth products continue

 Over 1,000 staff progressing remediation activities

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Salaried Financial Planner fee for no service addressed in prior years (>$150m cumulative pre-tax charges).

DIVIDEND

PROPOSED 2019 FINAL DIVIDEND 80 CPS, 70% FRANKED

DIVIDEND PER SHARE

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cents
160 160 160
80 80 80
80 80 80
FY17 FY18 FY19
Interim Final
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SHARES ON ISSUE[1]

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m
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Benefiting from $3b buy-back & 6 consecutive halves of DRP neutralisation

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2,926
2,903
2,843
FY17 FY18 FY19
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Cash Continuing weighted average number of ordinary shares

DIVIDEND

GEOGRAPHIC EARNINGS

AUSTRALIA GEOGRAPHY EARNINGS & DPOR[1]

GEOGRAPHIC EARNINGS[1]

% of total Group Statutory Profit

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82%
76%
73%
72%
69%
64% 64%
62%
61%
55%
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FY16 FY17 FY18 FY19
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FY15

DPOR Australia Geography earnings (% of total statutory earnings)

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11% 10% 11%
16% 16%
25% 26%
28%
22%
29%
62% 64% 64% 61%
55%
FY15 FY16 FY17 FY18 FY19
Australia New Zealand International
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Statutory Profit basis
DPOR: Dividend payout ratio

1H20 CONTEXT

 Home loan momentum

Low interest rate environment
Markets
Costs
Regulatory capital

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2019 FULL YEAR RESULTS — INVESTOR DISCUSSION PACK GROUP & DIVISIONAL PERFORMANCE

FINANCIAL PERFORMANCE – STATUTORY TO CASH PROFIT

STATUTORY PROFIT

CASH PROFIT REPORTED

CASH PROFIT CONTINUING OPERATIONS

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$m $m $m
-7%
0%
+6%
6,406 6,400 6,938 6,809
5,953 6,487 6,470
5,709 6,161
5,889 5,805 5,889
FY16 [1] FY17 [1] FY18 FY19 FY16 [1] FY17 [1] FY18 FY19 FY16 [1,2] FY17 [1] FY18 FY19
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STATUTORY TO CASH ADJUSTMENTS

Cash profit represents ANZ’s preferred measure of the result of the ongoing business activities of the Group, enabling readers to assess Group and Divisional performance against prior periods and against peer institutions.

To calculate cash profit, the Group excludes non-core items from statutory profit. Cash Profit continuing operations excludes the financial results of the Wealth Australia businesses being divested and associated Group reclassification and consolidation impacts treated as discontinued operations from a financial reporting perspective.

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FY16 and FY17 have not been restated for AASB15 impacts 2. FY16 has not been restated to reflect discontinued operations

LARGE / NOTABLE (L/N) ITEMS[1]

	1H17	2H17	1H18	2H18	1H19	2H19
Cash Profit Continuing Operations ($m)	3,355	3,454	3,493	2,994	3,564	2,906
Gain / (Loss) on sale from divestments	-284	14	138	53	187	18
Divested business results	274	187	70	56	25	7
Customer remediation	-40	-72	-45	-250	-70	-405
Restructuring	-25	-18	-55	-104	-36	-18
Royal Commission legal costs	0	0	-11	-27	-9	-1
Gain on sale of 100 Queen St. Melbourne	112	0	0	0	0	0
Accelerated software amortisation	0	0	0	-206	0	0
Total L/N within Cash Continuing Profit	37	111	97	-478	97	-399
Cash Profit ex L/N	3,318	3,343	3,396	3,472	3,467	3,305
Cash Profit ex L/N Growth HOH		0.75%	1.59%	2.24%	-0.14%	-4.67%
Cash Profit ex L/N Growth PCP			2.35%	3.86%	2.09%	-4.81%
	1H17	2H17	1H18	2H18	1H19	2H19
Gain/ (Loss) on Sale from divestments($m)
Asia Retail			
MCC				
SRCB			
UDC				
Cambodia JV						
OPL NZ						
PNG Retail,Com,SME						
Paymark					
Divested Business Results($m)
SRCB	
Asia Retail			
MCC				
OPL NZ					
Paymark					
Cambodia JV						
PNG Retail,Com,SME						

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Large / notable items exclude the gain / (loss) on sale and divested business results of OnePath Life and One Path P&I, both accounted for as discontinued businesses.

CUSTOMER REMEDIATION

CUSTOMER REMEDIATION CONTINUING OPERATIONS

CUMULATIVE CUSTOMER REMEDIATION

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1,579
PRE TAX $m PRE TAX $m
485
422
928
119 753
256
181
1,157
352
29
153 220 572 672
51
86
1H17 2H17 1H18 2H18 1H19 2H19
110
POST TAX $m 1,216
337
334
100 657
22 534
67 156 180
127 882
19 42
13 112 157 407 477
35 36 40
1H18 2H18 1H19 2H19 1H17 2H17 1H18 2H18 1H19 2H19
Net interest income Other operating income Expenses Discontinued (Wealth businesses) Continuing operations
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FINANCIAL PERFORMANCE

CONTINUING OPERATIONS EXCLUDING LARGE / NOTABLE ITEMS

FY19

2019 SECOND HALF PERFORM $m	ANCE FY18	FY19	FY19 v FY18
Cash Profit 6,487 6,470 0%
Large/Notable items(L/N) -381 -302
Cash Profit ex L/N 6,868 6,772 -1%
Australia Retail & Commercial 3,992 3,581 -10%
Institutional 1,666 1,852 +11%
New Zealand(NZD) 1,597 1,526 -4%

FY19 CASH PROFIT DRIVERS

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$m
6,868
1 131 6,772
-94
-134
0% 0% +20% -1%
FY18 Revenue Expenses Provisions Tax & NCI FY19
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2H19

2H19 CASH PROFIT DRIVERS

$m	2H18	1H19	2H19	2H19 v 1H19
Cash Profit 2,994 3,564 2,906 -18%
Large/Notable items (L/N) -478 97 -399
Cash Profit ex L/N 3,472 3,467 3,305 -5%
Australia Retail & Commercial 1,959 1,786 1,795 1%
Institutional 911 1,004 848 -16%
New Zealand (NZD) 817 782 744 -5%

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$m
3,467
56 3,305
-130
-82 -6
-1% +2% +2% -5%
1H19 Revenue Expenses Provisions Tax & NCI 2H19
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BALANCE SHEET STRENGTH

CAPITAL REALLOCATION & FLEXIBILITY

CAPITAL REALLOCATION[1]

CAPITAL FLEXIBIILTY

CET1 CAPITAL FREED UP FROM TRANSFORMATION

SEPTEMBER 2015

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PRO-FORMA SEPTEMBER 2019[2,3]

INCLUDING ANNOUNCED ASSET DISPOSALS

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11.9 11.9
Institutional
4.5 Retained for growth
reshaping
5.6 and capital
management
Net Imposts
2.5
Announced
asset sales 7.4 Cash not yet
0.8
received
Announced buy-back
3.0
completed
Source Use
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Institutional[1] Retail & Commercial Wealth

Allocation based on Regulatory Capital. Institutional shown under 2015 IIB Structure, including Institutional, Asia Partnerships and Asia Retail & Pacific
Pro-Forma adjusted for all announced Asset disposals – OnePath P&I.
ANZ lenders mortgage insurance, ANZ share investing, general insurance distribution and Wealth continuing operations (collectively ~1% of Group Capital) included in Retail and Commercial

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BALANCE SHEET COMPOSITION

BY SEGMENT

NET LOANS & ADVANCES

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$b
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615
606
580 4 1
7
150 165
132
96 97 97
14 14 13
331 341 339
Sep-17 Sep-18 Sep-19
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Housing (Aus & NZ) Commercial (Aus & NZ) Other Other Retail (Aus & NZ) Institutional

CUSTOMER DEPOSITS

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$b
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512
487 4
468
2
217
206
189
95 98 102
182 184 189
-1
Sep-17 Sep-18 Sep-19
Retail (Aus & NZ) Institutional
Commercial (Aus & NZ) Other
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REVENUE PERFORMANCE

CONTINUING OPERATIONS

TOTAL REVENUE

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CONTINUING OPERATIONS EX LARGE / NOTABLE ITEMS
$b $b
-2% 0%
19.8 19.4 19.1 19.0 18.9
19.0
4.9 4.7 4.5 4.5
4.9 4.7
14.9 14.5 14.3 14.4 14.5 14.4
FY17 [1] FY18 FY19 FY17 [1] FY18 FY19
Net interest income Other operating income
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OTHER OPERATING INCOME

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----- Start of picture text -----

CONTINUING OPERATIONS EX LARGE / NOTABLE ITEMS
$b $b
-3% 0%
4.9 4.7
4.9
0.3 0.2 4.7 0.2 4.5 4.5
0.3 0.2 0.3
0.8 0.9 0.8 0.5 0.4
0.6
2.2 2.5
2.4 2.5 2.7
2.6
1.4 1.1 1.3 1.4 1.1 1.3
FY17 [1] FY18 FY19 FY17 [1] FY18 FY19
Markets Fee & comm. Other Assoc. profit
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FY17 has not been restated for AASB15 impacts

EXPENSE MANAGEMENT

CONTINUING OPERATIONS

TOTAL EXPENSES

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CONTINUING OPERATIONS EX LARGE / NOTABLE ITEMS
$b $b
-4%
9.4 0%
9.0 9.1
8.5 8.6 8.6
1.7
1.5 1.9
1.4 1.5 1.5
0.2
0.1
0.1
1.6 1.9
1.5 1.6 1.6 1.5
0.9
0.8 0.8 0.9 0.8 0.8
4.9 4.8 4.8 4.7 4.6 4.7
FY17 [1] FY18 FY19 FY17 [1] FY18 FY19
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Personnel Premises Technology Restructuring Other

FULL TIME EQUIVALENT STAFF

CONTINUING OPERATIONS

‘000s

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50.2 37.9 37.6
46.6 3% 3%
44.9
39.9 39.1 28% 29%
16%
16%
42.9 16% 15%
37.9 37.6
37% 37%
Sep-15 Sep-16 Sep-17 Sep-18 Sep-19 Sep-18 Sep-19
Discontinued Business Australia R&C TSO & Group Centre
Continuing Business Institutional Pacific
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FY17 has not been restated for AASB15 impacts

NET INTEREST MARGINS

GROUP & DIVISIONAL MARGIN PERFORMANCE CONTINUING OPERATIONS

FULL YEAR

GROUP

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AUSTRALIA RETAIL &
COMMERCIAL
bps
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bps bps
199 187 274 269 259
176
FY17 FY18 FY19 FY17 FY18 FY19
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INSTITUTIONAL

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bps
101
88
82
FY17 FY18 FY19
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NEW ZEALAND

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bps
236 242 233
FY17 FY18 FY19
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HALF YEAR

GROUP

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bps
182 180 172
2H18 1H19 2H19
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----- Start of picture text -----

AUSTRALIA RETAIL &
COMMERCIAL
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----- Start of picture text -----

bps
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----- Start of picture text -----

261 261 258
2H18 1H19 2H19
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INSTITUTIONAL

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bps
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----- Start of picture text -----

86 85
80
2H18 1H19 2H19
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NEW ZEALAND

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bps
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----- Start of picture text -----

241 239
227
2H18 1H19 2H19
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RISK ADJUSTED PERFORMANCE

CONTINUING OPERATIONS EXCLUDING LARGE / NOTABLE ITEMS

GROUP[1]

AUSTRALIA RETAIL & COMMERCIAL

INSTITUTIONAL[1]

NEW ZEALAND

NET INTEREST INCOME / AVERAGE CREDIT RISK WEIGHTED ASSETS %

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4.54 4.52 4.55 4.43
1H18 2H18 1H19 2H19
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6.07
5.89 5.86 5.81
1H18 2H18 1H19 2H19
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2.33
2.25 2.24
2.14
1H18 2H18 1H19 2H19
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5.21 5.31 5.36 5.31
1H18 2H18 1H19 2H19
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AVERAGE CREDIT RISK WEIGHTED ASSETS

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$b
306 305 310 312
1H18 2H18 1H19 2H19
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143 142 141 139
1H18 2H18 1H19 2H19
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----- Start of picture text -----

103 105 110 113
1H18 2H18 1H19 2H19
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50 50 52 53
1H18 2H18 1H19 2H19
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Excluding Markets business unit and balance sheet impacts of divestments

DIVISIONAL PERFORMANCE

CASH PROFIT

CONTINUING OPERATIONS

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REVENUE EXPENSES
$b $b
19.4
19.0
1.0
1.0
3.3
3.3
5.1
5.3
9.4
9.1
1.2
1.0
1.2
1.3
2.9 2.7
10.0
9.4
4.1 4.1
FY18 FY19 FY18 FY19
Australia Retail & Commercial Institutional NZ Other
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CONTINUING OPERATIONS EX LARGE / NOTABLE ITEMS

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REVENUE EXPENSES
$b $b
19.0 18.9
0.6 0.8
3.2
3.3
5.0
5.2 8.6 8.6
1.0 1.0
1.2 1.3
2.7 2.6
10.2
9.6
3.8 3.7
FY18 FY19 FY18 FY19
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Australia Retail & Commercial Institutional NZ Other

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DIVISIONAL GROWTH RATES

CONTINUING OPERATIONS EXCLUDING LARGE / NOTABLE ITEMS

FY19 v FY18	Revenue	Expenses	Pre Provision Profit	Cash Profit	FY19 Cash Profit ($m)
Australia Retail & Commercial	-6%	0%	-9%	-10%	3,581
Institutional	5%	-3%	14%	11%	1,852
New Zealand(NZD)	2%	5%	-1%	-4%	1,526
Other	19%	0%	-35%	-59%	-104

2H19 v 1H19	Revenue	Expenses	Pre Provision Profit	Cash Profit	2H19 Cash Profit ($m)
Australia Retail & Commercial	-1%	1%	-2%	1%	1,795
Institutional	-4%	-1%	-8%	-16%	848
New Zealand(NZD)	1%	8%	-2%	-5%	744
Other	0%	4%	20%	-32%	-42

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AUSTRALIA RETAIL & COMMERCIAL

FINANCIAL PERFORMANCE: CONTINUING OPERATIONS EXCLUDING LARGE / NOTABLE ITEMS

$m	FY18 FY19 FY19 v FY18	1H19 2H19 2H19 v 1H19
Income 10,165 9,575 -6% 4,807 4,768 -1% Net interest income 8,540 8,178 -4% 4,114 4,064 -1% Other operating income 1,625 1,397 -14% 693 704 2% Expenses 3,756 3,743 -0% 1,858 1,885 1% Profit before provisions 6,409 5,832 -9% 2,949 2,883 -2% Provisions 698 712 2% 396 316 -20% Cash profit continuing 3,992 3,581 -10% 1,786 1,795 1%
Return on Avg RWAs 2.48% 2.25% -23bps 2.24% 2.26% +2bps Operating expense to operating income 37.0% 39.1% +214bps 38.7% 39.5% +88bps Total credit impairment charge/Avg GLAs 0.21% 0.21% 0bps 0.23% 0.19% -4bps

INCOME DRIVERS FY19 V FY18 (YOY)

$m 10,165			-307
		-57		-39
	FY19 v		FY18	$m %
	Net interest income Retail NII Commercial NII Other operating income			-362 -4% -277 -5% -85 -3% -228 -14%

FY18	Comm. Fee income Volumes Margin Retail Fee Income Other FY19

INCOME DRIVERS 2H19 V 1H19 (HOH)

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$m
4,807 7 4 22 4,768
-59 -13
2H19 v 1H19 $m %
Net interest income -50 -1%
Retail NII +21 +1%
Commercial NII -71 -5%
Other operating income +11 +2%
1H19 Volumes Margin Retail Fee Comm. Other 2H19
Income Fee
income
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AUSTRALIA RETAIL & COMMERCIAL

FINANCIAL PERFORMANCE: CONTINUING OPERATIONS EXCLUDING LARGE / NOTABLE ITEMS

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Productivity initiatives including
Slower credit demand, tighter Lower collective provision charge
workforce and branch optimisation
home loan origination risk reflects reduced FUM.
have offset increased compliance Profit and Returns
settings, increased competition, Credit provisions remain below
costs and technology
deposit margin impacts long-run averages
infrastructure spend
Income ($m) Expenses ($m) Total Provisions ($m) Cash Profit ($m)
5,137 5,028 4,807 4,768 1,898 1,858 1,858 1,885 312 386 396 316 2,046 1,946 1,786 1,795
350
375
338 355
-25 11 46 -39
1H18 2H18 1H19 2H19 1H18 2H18 1H19 2H19 1H18 2H18 1H19 2H19
1H18 2H18 1H19 2H19
IP CP
NLAs ($b) & NIM FTE Risk Weighted Assets ($b) Return
340 341 337 332 14,673 13,731 13,660 13,903 6.36% 6.25% 6.04% 6.02%
161 159 159 162
2.79% 2.65% 2.63% 2.62%
2.53% 2.42% 2.24% 2.26%
1H18 2H18 1H19 2H19 Mar-18 Sep-18 Mar-19 Sep-19 1H18 2H18 1H19 2H19 1H18 2H18 1H19 2H19
NLA NIM% Revenue / Avg RWA
Return on Avg RWA
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AUSTRALIA - RETAIL

CONTINUING OPERATIONS EXCLUDING LARGE / NOTABLE ITEMS

Financial performance ($m)	2H18	1H19	2H19	2H19 v 1H19
Revenue	3,391	3,217	3,244	1%
Expenses	1,287	1,250	1,312	5%
Profit Before Provisions	2,104	1,967	1,932	-2%
Provisions	201	230	162	-30%
NPAT	1,330	1,215	1,238	2%
Operational metrics	2H18	1H19	2H19	2H19 v 1H19
FTE	11,320	11,150	11,287	2%
Branches	629	593	577	-3%
Digital Branches	114	128	142	11%
Total Retail customers (#m)	5.74	5.80	5.87	1%
Retail customers > 1 product (#m)	4.81	4.87	4.90	1%
Digitally active customers (#m)1	3.50	3.56	3.60	1%
Digital sales (% of sales)1	25.2	27.3	30.0	268bps
Supported wallet transactions (#m)	38.2	51.0	69.0	35%

NET INTEREST INCOME

OTHER OPERATING INCOME

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$m $m
2,812 2,757 2,778 579
460 466
2H18 1H19 2H19 2H18 1H19 2H19
NET LOANS & ADVANCES CUSTOMER DEPOSITS
$b $b
283 279 275 120 117 121
2H18 1H19 2H19 2H18 1H19 2H19
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NET LOANS & ADVANCES

• Lower lending volumes with slower system credit growth, competition and tighter home loan origination risk settings

NIM impacted by home loan mix changes and higher discounting, the impact of deposit rates and regulatory impact on credit card pricing. This was partially offset by home loans re-pricing

Other operating income impacted by removal of fees and lower volumes

Significant progress in 2H19 on lifting momentum in home loans with applications up half-on-half

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Digitally active customers & Digital Sales are inclusive of both Retail and Commercial customers

AUSTRALIA – COMMERCIAL

CONTINUING OPERATIONS EXCLUDING LARGE / NOTABLE ITEMS

Financial performance ($m)	2H18	1H19	2H19	2H19 v 1H19
Revenue	1,637	1,590	1,524	-4%
Expenses	571	608	573	-6%
Profit Before Provisions	1,066	982	951	-3%
Provisions	185	166	154	-7%
NPAT	616	571	557	-2%
Operational metrics	2H18	1H19	2H19	2H19 v 1H19
FTE	2,411	2,510	2,616	4%
Total Commercial customers (#k)	490.9	490.2	495.6	1%
Comm Customers > 1 product (#k)	218.8	217.9	218.9	0%
RWA Intensity (Avg RWA / Avg GLA)	104%	102%	99%	-270bps
Credit impairment / Avg GLA (%)	0.71	0.64	0.59	-5bps
Growth in specialist channels1	6%	3%	4%	116bps

NET INTEREST INCOME

OTHER OPERATING INCOME

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$m
1,385 1,357 1,286
2H18 1H19 2H19
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----- Start of picture text -----

$m
252 233 238
2H18 1H19 2H19
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NET LOANS & ADVANCES

CUSTOMER DEPOSITS

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$b $b
58 57 57 83 86 87
2H18 1H19 2H19 2H18 1H19 2H19
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Revenue performance impacted by subdued credit growth, volume reductions, competition and deposit margin compression
Commercial lending volumes flat half-on-half, down 2% year-on-year, with reduction in Small Business Banking volumes, subdued Business Banking growth and Asset Finance run off
Commercial deposit growth up 5% year-on-year, driven by Small Business Banking (+5%), Business Banking (+3%) and Private Bank (+8%). Commercial Deposit to Loan ratio now above 1.5:1

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NLA FUM growth in specialised businesses (Health, Property, Agribusiness & Emerging Corporate)

AUSTRALIA RETAIL & COMMERCIAL

BALANCE SHEET

NET LOANS & ADVANCES[1]

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$b Commercial
Subdued system growth & increased competition
offset by specialist segment growth
Retail - Housing
Refer ‘Housing section’ for further detail
335 340 341 337 332
58 58 58 57 57
13 12 11 11 10
87 87 86 83 80
177 183 186 185 185
Sep-17 Mar-18 Sep-18 Mar-19 Sep-19
Comm Other Retail Housing - Inv Housing - OO
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CUSTOMER DEPOSITS

Customer preferences favouring saving products in low rate environment and transactional digital payments offering

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----- Start of picture text -----

208
201 204 203 203
26 27 28 28 30
27 27 28 27 27
56 58 58 61 58
92 92 89 87 93
Sep-17 Mar-18 Sep-18 Mar-19 Sep-19
Transact Offset Term Deposit Savings
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Housing - OO includes Equity Manager; Other retail includes Australia Wealth retained

INSTITUTIONAL

FINANCIAL PERFORMANCE: CONTINUING OPERATIONS EXCLUDING LARGE / NOTABLE ITEMS

$m	FY18 FY19 FY19 v FY18	1H19 2H19 2H19 v 1H19
Income 4,970 5,198 5% Net interest income 2,934 3,025 3% Other operating income 2,036 2,173 7% Expenses 2,661 2,575 -3% Profit before provisions 2,309 2,623 14% Provisions -46 -3 Large Cash profit continuing 1,666 1,852 11%		2,657 2,541 -4% 1,548 1,477 -5% 1,109 1,064 -4% 1,293 1,282 -1% 1,364 1,259 -8% -34 31 Large 1,004 848 -16%
Return on Avg RWAs 1.03% 1.10% +7 bps Operating expense to operating income 53.5% 49.5% -402 bps Total credit impairment charge / Avg GLAs -0.03% 0.00% +3 bps		1.22% 0.99% -23 bps 48.7% 50.4% +178 bps -0.04% 0.04% +8 bps

INCOME DRIVERS FY19 V FY18 (YOY)[1]

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INCOME DRIVERS 2H19 V 1H19 (HOH) [1]
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$m $m
122 104 5,198 2,657
4,970 22
-6 8 2,541
-14
-114 -2 -5 -3
-12% -1% +1% -1%
-1% +5% +10% +7%
FY18 Markets Trade PCM L&SF Other FY19 1H19 Markets Trade PCM L&SF Other 2H19
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L&SF = Loans and Specialised Finance; Trade = Trade and Supply Chain; PCM = Payments and Cash Management

INSTITUTIONAL

FY19 FINANCIAL PERFORMANCE: CONTINUING OPERATIONS EXCLUDING LARGE / NOTABLE ITEMS

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Continued momentum and Productivity focus maintained, Credit charges remained below Targeted profitable growth and
customer revenue growth absolute cost reduction long run trend improved returns
Income ($m) Expenses ($m) Total Provisions ($m) Cash Profit ($m)
5,501 4,970 5,198 2,772 2,661 2,575 89 1,877 1,666 1,852
4,061 4,057 4,341 50% 54% 50%
-3
FY17 [3] FY18 FY19 FY17 [3] FY18 FY19 -46 FY17 [3] FY18 FY19
Revenue Customer Revenue Expenses Cost-to-income ratio FY17 FY18 FY19
Risk Adjusted Margin FTE Avg. Risk Weighted Assets ($b) Return
2.04% 2.20% 2.28% 6,135 5,566 5,458 170 162 168 3.24% 3.07% 3.09%
1.1% 1.0% 1.1%
FY17 FY18 FY19 Sep-17 Sep-18 Sep-19 FY17 FY18 FY19 FY17 [3] FY18 FY19
Risk adjusted NIM [1] Revenue / Avg RWA
Return on Avg RWA [2]
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Institutional ex-Markets net interest income divided by average credit risk weighted assets 2. Cash profit divided by average risk weighted assets

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FY17 has not been restated for AASB15 impacts

INSTITUTIONAL

2H19 FINANCIAL PERFORMANCE: CONTINUING OPERATIONS EXCLUDING LARGE / NOTABLE ITEMS

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Subdued market environment Seventh consecutive half of Low credit charges indicate Economic conditions in 2H19
resulted in lower 2H19 revenue absolute cost reduction continued portfolio health impacted returns
Income ($m) Expenses ($m) Total Provisions ($m) Cash Profit ($m)
2,459 2,511 2,657 2,541 1,347 1,314 1,293 1,282 48 31 756 910 1,004 848
1,981 2,076 2,168 2,174 55% 52% 49% 50%
-34
1H18 2H18 1H19 2H19 1H18 2H18 1H19 2H19 -94 1H18 2H18 1H19 2H19
1H18 2H18 1H19 2H19
Revenue Customer Revenue Expenses Cost-to-income ratio
Risk Adjusted Margin FTE Avg. Risk Weighted Assets ($b) Return
2.14% 2.25% 2.33% 2.24% 5,879 5,566 160 163 166 171 3.08% 3.07% 3.22% 2.97%
5,469 5,458
0.95% 1.11% 1.22% 0.99%
1H18 2H18 1H19 2H19 Mar-18 Sep-18 Mar-19 Sep-19 1H18 2H18 1H19 2H19 1H18 2H18 1H19 2H19
Revenue / Avg RWA
Risk adjusted NIM [1]
Return on Avg RWA [2]
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Institutional ex-Markets net interest income divided by average credit risk weighted assets 2. Cash profit divided by average risk weighted assets

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INSTITUTIONAL

TOTAL REVENUE REDUCED IN 2H19 IN MARKETS AND INTERNATIONAL, CUSTOMER REVENUE REMAINED STABLE

REVENUE BY PRODUCT[1,2]

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-4%
$m
2,657
2,459 2,511 2,541
23
30 18 19
896 884 940 826
224 224 236 234
578 595 644 652
732 789 815 810
1H18 2H18 1H19 2H19
L&SF PCM Trade Markets Other
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CUSTOMER REVENUE[1]

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0%
2,168 2,174
2,076
1,981
1,227 1,292 1,314 1,342
211 205 204 225
543 579 649 606
1H18 2H18 1H19 2H19
International NZ Aus & PNG
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AVERAGE CREDIT RWA[1,2]

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+4%
$b
135 138 142 147
2 2 2 4
32 33 33 35
19 18 18 18
82 85 89 91
1H18 2H18 1H19 2H19
L&SF Trade Markets Other
REVENUE BY REGION [1]
$m
-4%
2,657
2,459 2,511 2,541
1,443
1,355 1,450 1,445
266
279 260 295
825 801 948 801
1H18 2H18 1H19 2H19
International NZ Aus & PNG
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L&SF = Loans and Specialised Finance; Trade = Trade and Supply Chain; PCM = Payments and Cash Management

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All numbers are excluding large / notable items

INSTITUTIONAL MARKETS INCOME

LOWER INCOME FROM BALANCE SHEET TRADING PARTLY OFFSET BY STRENGTH IN THE FRANCHISE BUSINESS

MARKETS INCOME COMPOSITION[1] YOY

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$m -1%
2,332
229 1,780 1,766
625 63 38
566 446
557 271 361
921 880 921
FY17 FY18 FY19
Franchise Sales Franchise Trading Balance Sheet Derivative valuation adj.
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MARKETS AVERAGE VALUE AT RISK (99% VAR)

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$m
40
30
20
10
0
1H17 2H17 1H18 2H18 1H19 2H19
Traded Non-traded
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MARKETS INCOME COMPOSITION[1] HOH

Lower revenue in 2H19 impacted by:

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$m • Flattening &
1,355 -12% inverting yield
162 curves
977 940 •
349 896 884 Lower volatility in
67 826
368 276 292 11 274 52 256 190 48 FX and rates markets
190 162 110 235 126
477 445 430 449 459 463 Customer Franchise
Sales remains stable
-10
1H17 2H17 1H18 2H18 1H19 2H19
Franchise Sales Franchise Trading Balance Sheet Derivative valuation adj.
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VOLATILITY

Indexed: rebased to 100 (1H17)

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100
80
60
1H17 2H17 1H18 2H18 1H19 2H19
Currencies (CVIX) [2] Rates (SR VIX) [3] AUD/USD Vol [4]
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All numbers are excluding large / notable items 2. Deutsche Bank Currency Volatility Index – avg for each period shown 3. CBOE Interest Rate Volatility Index – avg for each period shown 4. AUD vs. USD 3 month at-the-money implied volatility – average for each period shown

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INSTITUTIONAL

SEVENTH CONSECUTIVE HALF OF ABSOLUTE COST REDUCTION

EXPENSE CONTRIBUTION[1]

FY19 EXPENSE DRIVERS[1]

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$m
-4%
-2%
-2%
1,494 -2% -2%
1,431 1,400 -2% -1%
1,372
1,347
1,314
1,293 1,282
711
692 656
680 645
643
638 633
87
79 86
90 82 84 81 87
696
660 658
601 620 587 574 563
1H16 2H16 1H17 2H17 1H18 2H18 1H19 2H19
Aus & PNG NZ International
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$m -3%
85 20
2,661
-80 2,575
-111
FY18 FX Inflation D&A Productivity FY19
FTE [1]
#
6,308 6,135
5,879
5,566 5,469 5,458
2,194 2,155
2,082
1,947 1,985 1,981
365 353 366 358 322 323
2,652 2,553 2,420 2,246 2,235 2,258
1,098 1,074 1,011 1,015 927 897
Mar-17 Sep-17 Mar-18 Sep-18 Mar-19 Sep-19
Aus & PNG NZ International Operations Hubs [2]
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All numbers are excluding large / notable items
The costs associated with Operations hubs are allocated to all geographies

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INSTITUTIONAL

VOLUME & MARGINS: CONTINUING OPERATIONS EXCLUDING LARGE / NOTABLE ITEMS

VOLUMES[1]

NIM BY REGION[3]

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$b bps
122 125
105 112 104 238 241 235
95 97 98 231 206 208 207
199
156 158 161
147
145 149
139 138
1H18 2H18 1H19 2H19 1H18 2H18 1H19 2H19 1H18 2H18 1H19 2H19 1H18 2H18 1H19 2H19 1H18 2H18 1H19 2H19 1H18 2H18 1H19 2H19
Gross Loans & Advances Customer Deposits Aus & PNG NZ International Institutional
AVERAGE CREDIT RWA [2] RISK ADJUSTED NIM [4]
$b bps
147
135 138 142
32 33 33 35 246 260 268 262 256 269 256 252
19 18 18 18 214 225 233 224
161 171 181 168
82 85 89 91
2 2 2 4
1H18 2H18 1H19 2H19 1H18 2H18 1H19 2H19 1H18 2H18 1H19 2H19 1H18 2H18 1H19 2H19
1H18 2H18 1H19 2H19
Markets Trade L&SF Other Aus & PNG NZ International Institutional
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Average Gross Loans & Advances for L&SF and Trade; average customer deposits for Payments and Cash Management 2. Trade = Trade and Supply Chain L&SF = Loans and Specialised Finance 3. Institutional ex-Markets net interest margin 4. Institutional ex-Markets net interest income divided by average credit risk weighted assets

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NEW ZEALAND DIVISION

FINANCIAL PERFORMANCE: CONTINUING OPERATIONS EXCLUDING LARGE / NOTABLE ITEMS

NZDm	FY18 FY19 FY19 v FY18	1H19 2H19 2H19 v 1H19
Income 3,483 3,538 2% 1,756 1,782 1% Net interest income 2,881 2,939 2% 1,460 1,479 1% Other operating income 602 599 0% 296 303 2% Expenses 1,257 1,326 5% 638 688 8% Profit before provisions 2,226 2,212 -1% 1,118 1,094 -2% Provisions 6 92 large 31 61 97% Cash profit continuing 1,597 1,526 -4% 782 744 -5%
Return on Avg RWAs 2.61% 2.47% -14 bps 2.54% 2.40% -14 bps Operating expense to operating income 36.1% 37.5% 139 bps 36.3% 38.6% 228 bps Total credit impairment charge / Avg GLAs 0.01% 0.07% 6 bps 0.05% 0.10% 5 bps

INCOME DRIVERS FY19 V FY18 (YOY)

INCOME DRIVERS 2H19 V 1H19 (HOH)

NZDm

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120 15 3,538
3,483
-62 -2 -16
FY19 v FY18 $m %
Net interest income 58 2%
Retail NII 1 0%
Commercial NII 52 5%
Central Functions NII 5
Other operating income -3 0%
FY18 Volumes Margin Retail Fee Comm. Other FY19
Income Fee
income
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NZDm
34
8 1 1,782
1,756 -2
-15
2H19 v 1H19 $m %
Net interest income 19 1%
Retail NII -3 0%
Commercial NII 22 4%
Central Functions NII 0
Other operating income 7 2%
1H19 Volumes Margin Retail Fee Comm. Other 2H19
Income Fee
income
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NEW ZEALAND DIVISION

FINANCIAL PERFORMANCE: CONTINUING OPERATIONS EXCLUDING LARGE / NOTABLE ITEMS

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Margin compression, compliance
Solid home lending growth within Increased regulatory compliance Provisions returning to more
costs and provisions impacting
a competitive environment requirements normalised levels
returns
Income (NZDm) Expenses (NZDm) Total Provisions (NZDm) Cash Profit (NZDm)
1,731 1,752 1,756 1,782 625 632 638 688 61 780 817 782 744
22 31
42
36 37
16 19
-14 -6
-32
-16
1H18 2H18 1H19 2H19 1H18 2H18 1H19 2H19 1H18 2H18 1H19 2H19 1H18 2H18 1H19 2H19
IP CP
NLAs (NZDb) & NIM FTE [1] Risk Weighted Assets (NZDb) Return
119 122 124 126 6,319 6,165 6,003 6,121 61 62 62 71 5.67% 5.72% 5.71% 5.75%
2.55% 2.67% 2.54% 2.40%
2.42% 2.41% 2.38% 2.35%
1H18 2H18 1H19 2H19 Mar-18 Sep-18 Mar-19 Sep-19 Mar-18 Sep-18 Mar-19 Sep-19 1H18 2H18 1H19 2H19
NLAs NIM Revenue / Avg RWA
1. Return on Avg RWA
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~~1. On a Continuing Operations basis~~

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NEW ZEALAND DIVISION – RETAIL

FINANCIAL PERFORMANCE: CONTINUING OPERATIONS EXCLUDING LARGE / NOTABLE ITEMS

Financial performance (NZDm)	2H18	1H19	2H19	2H19 v 1H19
Revenue	1,232	1,223	1,228	0%
Expenses	493	507	546	8%
Profit before provisions	739	716	682	-5%
Provisions	17	29	16	-45%
NPAT	520	495	480	-3%
Operational metrics	2H18	1H19	2H19	2H19 v 1H19
FTE	3,751	3,700	3,686	0%
Branches	179	170	164	-6
Total retail customers (#m)	2.10	2.12	2.12	0%
Retail customers > 1 product	67%	67%	67%	0%
Digitally active customers (#m)	1.43	1.47	1.50	2%
Digital sales (% of retail sales)	23	25	29	360 bps

NET INTEREST INCOME

OTHER OPERATING INCOME

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NZDm
946 936 933
2H18 1H19 2H19
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NZDm
286 287 295
2H18 1H19 2H19
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NET LOANS & ADVANCES

CUSTOMER DEPOSITS

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NZDb
79.1 81.1 82.5
Sep-18 Mar-19 Sep-19
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NZDb
70.3 71.9 73.9
Sep-18 Mar-19 Sep-19
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BRAND CONSIDERATION[2]

MARKET SHARE[1]

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30.7% 33.6% 23.5% 49.4% 46.1%
37.0% 36.3%
Household
Mortgages KiwiSaver ANZ Peer1 Peer 2 Peer 3
deposits
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Source: RBNZ, Mortgage and Household deposits market share as at August 2019, KiwiSaver FUM market share as at June 2019 2. Source: McCulley Research (first choice or seriously considered); six month rolling average, September 2019 (major four banks)

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NEW ZEALAND DIVISION - COMMERCIAL

FINANCIAL PERFORMANCE: CONTINUING OPERATIONS EXCLUDING LARGE / NOTABLE ITEMS

Financial performance (NZDm)	2H18	1H19	2H19	2H19 v 1H19
Revenue	519	527	547	4%
Expenses	130	127	141	11%
Profit before provisions	389	400	406	1%
Provisions	-33	2	45	Large
NPAT	303	287	260	-9%

Operational metrics	2H18	1H19	2H19	2H19 v 1H19
FTE	957	910	905	-1%
Return on Avg RWA	1.97%	1.86%	1.66%	-20 bps
Revenue per Avg RWA	3.38%	3.42%	3.50%	8 bps
Total loss rate	-0.16%	0.01%	0.21%	20 bps
Individual provision loss rate	-0.05%	0.06%	0.09%	3 bps

NET INTEREST INCOME

OTHER OPERATING INCOME

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NZDm
509 517 539
2H18 1H19 2H19
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NZDm
10 10
8
2H18 1H19 2H19
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CUSTOMER DEPOSITS

NET LOANS & ADVANCES

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NZDb
42.5 42.9 43.5
Sep-18 Mar-19 Sep-19
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NZDb
16.8 17.2 16.1
Sep-18 Mar-19 Sep-19
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STABLE RISK PROFILE[2]

AGRI LENDING MARKET SHARE[1]

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39.1%
0.68%
32.4% 28.1%
0.52% 0.50% 0.47% 0.50%
18.5 17.3 17.8
Sep-10 Sep-14 Aug-19 Sep-17 Mar-18 Sep-18 Mar-19 Sep-19
ANZ market share (%) ANZ Agri Lending (NZDb)
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1 Source: RBNZ

2 Gross impaired assets as a % of gross loans and advances

NEW ZEALAND DIVISION

BALANCE SHEET

GROSS LOANS & ADVANCES

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NZDb
126
124
122
118 119
10%
11%
12%
14% 13%
57%
56%
54%
52% 53%
32% 32% 31% 31% 31%
2% 2% 3% 2% 2%
Sep-17 Mar-18 Sep-18 Mar-19 Sep-19
Housing variable Housing fixed Non-housing Other
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CUSTOMER DEPOSITS

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NZDb
89 90
87
84
82
30% 31%
29%
30%
29%
50% 49% 51% 51% 50%
21% 21% 20% 19% 19%
Sep-17 Mar-18 Sep-18 Mar-19 Sep-19
Savings Term Deposit Transact
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WEALTH AUSTRALIA

DIVESTED BUSINESSES - PENSIONS AND INVESTMENTS (P&I)

FINANCIAL PERFORMANCE

GROSS MARGIN[2]

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$m
104
2 91
-15
FY18 Pro- Income Expense FY19 Pro-
forma NPAT [1] forma NPAT [1]
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$m
55.8% 56.2% 57.5% 61.0%
163 164 154 151
1H18 2H18 1H19 2H19
Cost-To-Income ratio (%)
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AVERAGE FUM[3]

GUIDE TO FINANCIAL PERFORMANCE

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$b -1%
48.7 49.0 47.0 48.4
1H18 2H18 1H19 2H19
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Prepared on a standalone pro forma basis[1 ] and excludes ANZ Group consolidation adjustments
Is not comparable with financial performance as reported within ANZ discontinued operations
The sale of Aligned Dealer Groups completed on 1 October 2018 and is excluded from the above results
Pro forma NPAT is prepared on a consistent basis as the Underlying Profit After Tax Pre-amortisation (UNPAT) disclosed by IOOF on 17 October 2017 transaction announcement. This excludes DAC/DEF related net charges, ANZ consolidation adjustments and amortisation of acquisition related intangibles. This includes normalisation and market pricing adjustments
Gross margin excludes DAC/DEF related net charges and includes normalisation
Average Funds Under Management (FUM) excludes legacy run-off portfolio of P&I products acquired by Zurich and FUM related to ANZ Private Bank trusts (Average FUM 1H18 : $1.1b, 2H18 : $1.4b, 1H19 : $1.6b, 2H19 : $1.8b)

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WEALTH AUSTRALIA

DIVESTED BUSINESSES – P&I FUM AND FLOWS

INFLOWS AND OUTFLOWS BY SOLUTION

FY19 NET FLOWS BY SOLUTION

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$m
Open solutions Closed solutions
-204
-332 -317
-1,127
-1,492
ANZ Smart Wrap OneAnswer Legacy Retail Legacy
Choice Frontier Employer
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	FY18	FY18	FY19	FY19
	Inflows	Outflows	Inflows	Outflows
Open solutions ANZ Smart Choice Wrap One Answer Frontier Closed solutions Legacy Retail Legacy Employer Total	4.2 2.2 0.8 1.3 0.4 0.3 0.1 4.6	-4.5 -2.1 -1.0 -1.4 -1.9 -1.6 -0.4 -6.4	3.4 2.0 0.7 0.8 0.4 0.4 0.1 3.9	-5.1 -2.2 -1.0 -1.9 -2.2 -1.8 -0.4 -7.3

AVERAGE FUM BY SOLUTION[1]

GUIDE TO FUM AND FLOW DISCLOSURES

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$b Open solutions Closed solutions
+2%
-10%
35 36 35 37 14 13
12 12
7 7 7 7 3 2
2 2
11 12 11 12
11 11 10 10
17 17 17 18
1H18 2H18 1H19 2H19 1H18 2H18 1H19 2H19
Wrap ANZ Smart Choice Legacy Employer Legacy Retail
OneAnswer Frontier
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Definition of open and closed solutions is consistent with the classification disclosed by IOOF on 17 October 2017 ASX announcement and it is not comparable with Funds Management cash flows by product historically published in ANZ results
FUM and flows information presented herein is not comparable with industry data as it excludes products not acquired by IOOF
FUM outflows include pension payments
This analysis has been prepared on a standalone pro forma basis
1.Average FUM excludes legacy run-off portfolio of Pension and Investment products acquired by Zurich and FUM related to ANZ Private Bank trusts ( Average FUM 1H18 : $1.1b, 2H18 : $1.4b, 1H19 : $1.6b, 2H19 : $1.8b). NOTE: The sum of inflows and outflows by solution may not align to total due to rounding.

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2019 FULL YEAR RESULTS

—

INVESTOR DISCUSSION PACK TREASURY

REGULATORY CAPITAL

CAPITAL UPDATE

APRA LEVEL 2 COMMON EQUITY TIER 1 (CET1)

APRA Level 2 CET1 ratio of 11.4% (16.4% on an Internationally Comparable basis[1] ), which is in excess of APRA’s ‘unquestionably strong’ benchmark[2] .
APRA Level 1 CET1 ratio of 11.4%. Level 1 consolidation primarily comprises ANZ BGL (the Parent including offshore branches) but excludes offshore banking subsidiaries[3] .
APRA Leverage ratio of 5.6% (or 6.2% on an Internationally Comparable basis).
Asset divestments contributed ~$2b in 2H19 (mainly divestment of OPL Australia)
Pro-forma adjusted CET1 ratio of ~11.5%, including benefits from P&I divestment (~20bps), partially offset by IFRS16 impacts (~-7bps)

Organic Capital Generation

Net organic capital generation of 75bps for 2H19 – in line with historical averages of ~80bps (excluding Institutional rebalancing)

Capital Outlook – Regulatory Development

RBNZ capital proposal – Potential impact of NZ$6b to NZ$8b for ANZ NZ (from Sep-18). Final impact depends on the outcome of the RBNZ consultation.
APRA loss absorbing capacity (TLAC) – Total Capital requirements increased by 3% of RWA (~$12b in Tier 2 based on Sep-19 position) by January 2024.
Revisions to treatment of equity investments in subsidiaries - in the absence of any offsetting management actions, this implies a reduction in ANZ’s Level 1 CET1 capital ratio of up to approximately $2.5b (75bps). However, ANZ believes that this outcome is unlikely and, post implementation of management actions, the net capital impact could be minimal.
Other ongoing APRA regulatory reviews potentially impacting the future capital position include: Revisions to capital framework (RWA), Unquestionably Strong capital calibration, and the Transparency, Comparability and Flexibility proposals.

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%
Net Organic Capital
Generation +75bps
0.83 0.02 0.52
11.44 11.49 11.36
-0.10
-0.56 -0.51 -0.13 -0.20
Sep-18 Mar-19 Cash RWA Capital Dividends Asset Net Reme- Other [7] Sep-19
NPAT [4] Business Deduc- Divest- Imposts [6] diation
growth tions [5] ments
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LEVEL 2 BASEL III CET1

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%
16.8 16.9 16.4
11.4 11.5 11.4
Sep-18 Mar-19 Sep-19
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APRA Internationally Comparable[1]

Internationally Comparable methodology aligns with APRA’s information paper entitled International Capital Comparison Study (13 July 2015). Basel III Internationally Comparable ratios do not include an estimate of the Basel I capital floor 2. Based on APRA information paper “Strengthening banking system resilience – establishing unquestionably strong capital ratios” released in July 2017 3. Refer to ANZ Basel III APS330 Pillar 3 disclosures 4. Cash NPAT excludes ‘Large/notable’ items’ and one-off items 5. Mainly comprises the movement in retained earnings in deconsolidated entities and capitalised software 6. Includes SA-CCR (-18bps); APRA Operational Risk overlay (-18bps); and RWA floors for NZ housing/farm exposures (-18bps) 7. Other impacts include movements in non-cash earnings and net foreign currency translation

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REGULATORY CAPITAL GENERATION

COMMON EQUITY TIER 1 GENERATION (bps)	2H averages 2H12-2H18	2H19	Full Year average FY12-FY18	FY19
Cash NPAT1 95 83 189 172
RWA movement 1 (10) (13) (7)
Capital Deductions2 (6) 2 (18) -
Net capital generation 90 75 158 165
Gross dividend (61) (57) (128) (117)
Dividend Reinvestment Plan3 10 1 19 2
Core change in CET1 capital ratio 39 19 49 50
Other non-core and non-recurring items (2) (32) 7 (58)
Net change in CET1 capital ratio 37 (13) 56 (8)

Organic Capital Generation

Net organic capital generation of +165bps for FY19 and +75bps for 2H19
Excluding Institutional portfolio rebalancing period, FY19 net organic capital generation is stronger by +24bps

HISTORICAL NET ORGANIC CAPITAL GENERATION

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bps
Avg +141bps
(ex. Institutional portfolio rebalancing FY16 & FY17)
Avg +204bps
Institutional portfolio
rebalancing
229
179 182
165
144
119 128 130
bps
FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19
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Cash NPAT excludes ‘large/notable items’ & one off items (which are included as “other non-core and non-recurring items”)
Represents movement in retained earnings in deconsolidated entities, capitalised software, expected losses in excess of eligible provisions shortfall and other intangibles 3. Includes Bonus Option Plan

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INTERNATIONALLY COMPARABLE[1] REGULATORY CAPITAL POSITION

APRA Level 2 CET1 – 30 September 2019	11.4%
Corporate undrawn EAD and unsecured LGD adjustments Australian ADI unsecured corporate lending LGDs and undrawn CCFs exceed those applied in many jurisdictions	1.6%
Equity Investments & DTA APRA requires 100% deduction from CET1 vs. Basel framework which allows concessional threshold prior to deduction	0.9%
Mortgages APRA requires use of 20% mortgage LGD floor vs. 10% under Basel framework. Additionally, APRA also requires a higher correlation factor vs 15% under Basel framework.	1.2%
Specialised Lending APRA requires supervisory slotting approach which results in more conservative risk weights than under Basel framework	0.7%
IRRBB RWA APRA includes in Pillar 1 RWA. This is not required under the Basel framework	0.2%
Other Includes impact of deductions from CET1 for capitalised expenses and deferred fee income required by APRA, currency conversion threshold and other retail standardised exposures	0.4%
Basel III Internationally Comparable CET1	16.4%
Basel III Internationally Comparable Tier 1 Ratio	18.8%
Basel III Internationally Comparable Total Capital Ratio	21.4%

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Internationally Comparable methodology aligns with APRA’s information paper entitled International Capital Comparison Study (13 July 2015). Basel III Internationally Comparable ratios do not include an estimate of the Basel I capital floor

CET1 AND LEVERAGE IN A GLOBAL CONTEXT

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CET1 RATIOS [1] LEVERAGE RATIOS [1,2]
5% 10% 15% 20% 2% 4% 6% 8%
ABN Amro OCBC
Svenska Handelsbanken UOB
SEB
DBS
Swedbank
Morgan Stanley BBVA
Danske Bank Erste Bank
ANZ Raiffeisen Bank International (RBI)
RBS Intesa Sanpaolo
Rabobank
ANZ
Groupe BPCE
Credit Agricole Group HSBC
Nordea Rabobank
ING Group Credit Agricole Group
OCBC Standard Chartered
HSBC
UBS
UOB
Raiffeisen Bank International (RBI) Credit Suisse
Standard Chartered RBS
DBS Groupe BPCE
Goldman Sachs
Nordea
Erste Bank
Deutsche Bank Barclays Leverage
Barclays Santander
UBS UniCredit ANZ compares equally well
JP Morgan Swedbank on leverage, however
Intesa Sanpaolo ABN Amro international comparisons
Commerzbank are more difficult to make
Wells Fargo SEB
Credit Suisse Svenska Handelsbanken given the favourable
Citibank Commerzbank treatment of derivatives
State Street Danske Bank under US GAAP
BNP Paribas
UniCredit ING Group
Societe Generale RBC
Bank of America Societe Generale
TD BMO
RBC Scotia
BBVA
BNP Paribas
Santander
BMO Deutsche Bank
Scotia TD
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CET1 and leverage ratios are based on ANZ estimated adjustment for accrued expected future dividends where applicable. ANZ ratios are on an Internationally Comparable basis. All data sourced from company reports and ANZ estimates based on last reported half/full year results assuming Basel III capital reforms fully implemented 2. Includes adjustments for transitional AT1 where applicable. Exclude US banks as leverage ratio exposures are based on US GAAP accounting and therefore incomparable with other jurisdictions which are based on IFRS.

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BALANCE SHEET STRUCTURE[1]

BALANCE SHEET COMPOSITION

NSFR COMPOSITION

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Sep 2019
$515b
Wholesale $443b
Funding & Other [3] Liquids
Non Financial and Other Assets [4]
Corporates
Other
Loans [5]
Retail/SME
Residential
Mortgages [6,7 ]
Capital <35%
Available Required
Stable Funding Stable Funding
NSFR MOVEMENT
Sep 2018 v Sep 2019 ~115% adjusted for CLF
reduction from 1 Jan 2020
0.8%
2.6% 0.2%
116.4%
-0.2% -0.6%
114.6% -1.0%
Sep-18 Retail/Corp/ Loans Wholesale Liquid Bank Other [8] Sep-19
Operational Debt, SHE Assets Deposits
Deposits & Hybrids & Repo
Funding
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Short Term Wholesale Debt &
Liquid and Other Assets Other Funding [2]
29% 25%
FI Lending
6% Corporate, PSE & Operational
Deposits
21%
Non-FI Lending
25%
Retail & SME Deposits
31%
Mortgages
40% Long Term Wholesale Debt
14%
Capital Incl. Hybrids & T2
9%
Assets Funding
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NSFR MOVEMENT

NSFR Required Stable Funding (RSF) and Available Stable Funding (ASF) categories and all figures shown are on a Level 2 basis per APRA prudential standard APS210 2. Includes FI/Bank deposits, Repo funding and other short dated liabilities 3. ‘Other’ includes Sovereign, and non-operational FI Deposits 4. ‘Other Assets’ include Off Balance Sheet, Derivatives, Fixed Assets and Other Assets 5. All lending >35% Risk weight 6. Includes NSFR impact of self-securitised assets backing the Committed Liquidity Facility (CLF) 7. <35% Risk weighting as per APS 112 Capital Adequacy: Standardised Approach to Credit Risk 8. Net of other ASF and other RSF

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LIQUIDITY COVERAGE RATIO (LCR) SUMMARY[1]

LCR COMPOSITION (AVERAGE)

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FY19
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MOVEMENT IN AVERAGE LCR SURPLUS ($b)
FY18 v FY19
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$188b
Internal RMBS
Other ALA [2]
HQLA2
$134b
Wholesale funding
HQLA1
Customer deposits
& other [3]
Liquid Assets Net Cash Outflow
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Liquid Assets

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FY19
FY18
LCR 140%
LCR 138%
2
6 54
53
1
-4
0
-4
FY18 CLF [4] Liquid Retail/SME Corp/FI/ Wholesale Other [5] FY19
Assets PSE Funding
LCR Surplus LCR Surplus
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All figures shown on a Level 2 basis as per APRA Prudential Standard APS210 2. Comprised of assets qualifying as collateral for the Committed Liquidity Facility (CLF), excluding internal RMBS, up to approved facility limit; and any assets contained in the RBNZ’s liquidity Policy – Annex: Liquidity Assets – Prudential Supervision Department Document BS13A 3. ‘Other’ includes off-balance sheet and cash inflows 4. RBA CLF increased by $1.1b from 1 January 2019 to $48.0b (2018: $46.9b, 2017: $43.8b) 5. ‘Other’ includes off-balance sheet and cash inflows

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TERM WHOLESALE FUNDING PORTFOLIO[1]

ANZ’s term funding requirements depend on market conditions, balance sheet needs and exchange rates, amongst other factors
ANZ estimates an FY20 funding requirement broadly consistent with previous years at ~$25b

ISSUANCE

MATURITIES

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$14.5b in AUD
$b and NZD
32
27
24 24 22 22 24 23
21
19 18
14
11
2
FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24 FY25 FY26+
Senior Unsecured Covered Bonds Tier 2 RMBS
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PORTFOLIO

PORTFOLIO BY CURRENCY

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Domestic portfolio
up from 33% in
5%
7% FY18
2%
16% 23% Domestic (AUD, NZD)
38%
Senior Unsecured Tier 2 North America (USD, CAD)
Covered Bonds RMBS UK & Europe (£, €, CHF)
Asia (JPY, HKD, SGD, CNY)
75%
34%
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All figures based on historical FX and exclude AT1. Includes transactions with an original call or maturity date greater than 12 months as at the respective reporting date. Tier 2 maturity profile is based on the next callable date

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ANZ’S TIER 2 CAPITAL PROFILE[1]

ANZ’S TIER 2 CAPITAL REQUIREMENT TO PROGRESSIVELY INCREASE POST TLAC ANNOUNCEMENT

Issued AUD $1.75b in July 2019
Current portfolio includes 38% in AUD (32% domestic AUD) – strong capacity remaining in AUD
Annual total T2 issuance expected to be ~$4b
Required portfolio increase from $7.6b to ~$20b by January 2024
Planned issuance in multiple currencies in both callable and bullet format
Capacity in EUR T2 with no current outstandings following recent Sep-19 maturity
No AUD retail T2 outstanding
Extensive global USD T2 investor base
ANZ has historically had strong support from Asian local currency markets, both in benchmark and Private Placement format
Increased T2 issuance expected to be offset by reduction in other senior unsecured funding

TIER 2 CAPITAL

Notional amount

By Currency

By Format

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6%
6%
USD
7%
AUD Domestic
Bullet 6% 43%
46% AUD Offshore
54% Callable
JPY
SGD
32% CNY
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Well managed amortisation profile provides flexibility regarding issuance tenor

FUNDING PROFILE

CAPITAL AMORTISATION PROFILE[2]

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Notional amount, $m $m
2,937 2,444
2,282
1,368
1,068
831 735 824
674
498 456 456
131 225 225
0
FY20 FY21 FY22 FY23 FY24 FY25 FY26 FY27 FY20 FY21 FY22 FY23 FY24 FY25 FY26 FY27
Scheduled Bullet and Call Date Profile Bullet Amortisation Callable
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Profile is AUD equivalent based on historical FX, excluding Perpetual Floating rate notes issued 30 October 1986 (which loses Basel III transitional relief in 2021). Any call is subject to APRA’s prior written approval and note holders should not expect approval to be given
Amortisation profile is modelled based on scheduled first call date for callable structures and in line with APRA’s amortisation requirements for bullet structures

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IMPACTS OF RATE MOVEMENTS

BILLS/OIS SPREAD

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bps
65
60
55
50
45
40
35
30
25
20
15
10
5
0
Oct- Jan- Apr- Jul- Oct- Jan- Apr- Jan- Sep-
17 18 18 18 18 19 19 19 19
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Spot 3mth Bills/OIS Spread Rolling 90 days

FY18 Ave[1] : 36.3bps

1H18 Ave: 24.4bps 2H18 Ave: 48.1bps FY19 Ave[1] : 37.5bps 1H19 Ave: 48.0bps 2H19 Ave: 27.0bps

CAPITAL & REPLICATING DEPOSITS PORTFOLIO (AUSTRALIA)

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%
3.0
2.5
2.0
1.5
1.0
0.5
Oct- Jan- Apr- Jul- Oct- Jan- Apr- Jul- Oct- Jan- Apr- Jul- Sep-
16 17 17 17 17 18 18 18 18 19 19 19 19
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3mth BBSW (Monthly Average) Portfolio Earnings Rate

FY18 Ave: 2.29% 1H18 Ave: 2.29% 2H18 Ave: 2.28% FY19 YTD Ave: 2.08% 1H19 Ave: 2.21% 2H19 Ave: 1.95%

CAPITAL[2] & REPLICATING DEPOSITS PORTFOLIO

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AUST NZ APEA
Volume ($A) ~60bn ~20bn ~10bn
Target Duration Rolling 3 to 5 years Various
Proportion Hedged ~70% ~75% Various
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90 day rolling average of spot 3mth Bills/OIS spread
Includes other Non-Interest Bearing Assets & Liabilities

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CAPITAL FRAMEWORK

CURRENT REGULATORY PROPOSALS AND RECENT FINALISATION[1]

	1H19	2H19	2020	2021	2022	2024
RBNZ capital framework	Consultation	Finalise2		Trans	ition	Implementation
Counterparty Credit Risk3		Implementation
Leverage ratio	Consultation		Finalise		Implementation
Advanced approach to credit risk		Consultation			Implementation
Standardised approach to credit risk	Consultation		Finalise		Implementation
Operational risk	Consultation		Finalise	Implementation
Interest rate risk in the banking book		Consultation			Implementation
Loss absorbing capacity (LAC)4	Consultation	Finalise		Transition		Implementation
Related party exposures	Consultation	Finalise		Implementation
Capital treatment for Investments in subsidiaries (Level 1)			Consultation	Implementation

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Timeline is based on APRA’s 2019 Policy Agenda (published February 2019) 2. RBNZ is expected to finalise reforms towards the end of 2019 calendar year 3. Implementation 1 July 2019 4. Only in relation to the 3% of RWA increase in Total Capital requirements announced in July 2019

2019 FULL YEAR RESULTS — INVESTOR DISCUSSION PACK RISK MANAGEMENT

KEY RISK METRICS

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CREDIT IMPAIRMENT CHARGE INDIVIDUAL PROVISION (IP) CHARGE COLLECTIVE PROVISION (CP) BALANCE & COVERAGE
$m $m $m Sep-19 CP/CRWA impacted -3bps by increase in CRWA’s
787 from regulatory & methodology changes (incl. SA-CCR)
554
720 430 343 398 3,378 3,376
479 380 2,785 2,662 2,579 2,523
0.25% 408 393 402
280 0.98% 0.94%
0.16% 0.81% 0.79% 0.75% 0.75%
0.14% 0.13% 0.13%
0.09%
1H17 2H17 1H18 2H18 1H19 2H19 1H17 2H17 1H18 2H18 1H19 2H19 [1] Mar-17 Sep-17 Mar-18 Sep-18 Mar 19 Sep-19
CIC as % Avg.GLA Total Provision Charge New Increased Writebacks & Recoveries CP Balance CP/CRWA CP Balance (AASB9)
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GROSS IMPAIRED ASSETS NEW IMPAIRED ASSETS AUSTRALIA MORTGAGES 90DPD (INCL NPL)
$m $m $m 3,071
2,940 1,787 2,696
2,384 2,034 2,139 2,128 2,029 1,425 963 1,145 890 1,117 0.79%2,013 0.84%2,226 0.89%2,401 0.86%2,373 1.00% 1.16%
Mar-17 Sep-17 Mar-18 Sep-18 Mar-19 Sep-19 1H17 2H17 1H18 2H18 1H19 2H19 [2] Mar-17 Sep-17 Mar-18 Sep-18 Mar-19 Sep-19
Australia New Zealand Institutional Other Australia New Zealand Institutional Other 90DPD (Incl. NPL) % Total Portfolio
CREDIT RWA EXPOSURE AT DEFAULT (EAD) INTERNAL EXPECTED LOSS (IEL)
$b $b $m
342 337 343 338 346 358 899 903 930 944 968 977 1,983 1,870 1,780 1,666 1,659 1,605
38.0% 37.3% 36.9% 35.8% 35.7% 36.7% 0.35% 0.32% 0.30% 0.27% 0.27% 0.26%
Mar-17 Sep-17 Mar-18 Sep-18 Mar-19 Sep-19 Mar-17 Sep-17 Mar-18 Sep-18 Mar-19 Sep-19 1H17 2H17 1H18 2H18 1H19 2H19
CRWA CRWA/EAD IEL IEL/GLA
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Increase to New and Increased Individual Provisions and Writebacks & Recoveries compared to prior half is largely related to the home loan portfolio in Australia Retail and Commercial following the implementation of a more market responsive collateral valuation methodology
New Impaired Assets in 2H19 includes a $167m uplift on 1H19 in Australia home loans following the implementation of revised provisioning and impairment processes (including a more market responsive collateral valuation methodology)

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RISK MANAGEMENT

PROVISIONS

CREDIT IMPAIRMENT CHARGE

ANZ HISTORICAL LOSS RATES

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$m
1,500
1,200 1,038
918
900 720
479
600 408 280 393 402
300
0
-300
1H16 2H16 1H17 2H17 1H18 2H18 1H19 2H19
Consumer Commercial Institutional CP Charge
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bps
250
200
150
100
50
0
Sep Sep Sep Sep Sep Sep Sep Sep Sep Sep Sep Sep
90 93 96 99 02 05 08 11 14 17 18 19
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IP Loss Rate Median Annual IP Loss Rate (excl. current period)

INDIVIDUAL PROVISION CHARGE

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$m
1,047
892 787
554
826 430 343 398
380
922
969
812
612 594 592
532
495
229 153 136 116 122 93 157
-259 -274 -335 -394 -298 -373 -245 -351
1H16 2H16 1H17 2H17 1H18 2H18 1H19 2H19 [1]
New Increased Writebacks & Recoveries
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LONG RUN LOSS RATE (INTERNAL EXPECTED LOSS)

%
Division	Mar-16	Sep-16	Mar-17	Sep-17	Mar-18	Sep-18	Mar-19	Sep-19
Australia	0.35	0.33	0.33	0.33	0.31	0.29	0.29	0.29
New Zealand	0.25	0.26	0.26	0.22	0.21	0.19	0.19	0.18
Institutional	0.37	0.36	0.35	0.30	0.32	0.27	0.27	0.25
Other	1.47	1.79	1.60	1.69	1.95	1.78	1.60	1.40
Subtotal	0.34	0.33	0.33	0.30	0.30	0.27	0.27	0.26
Asia Retail	1.50	1.51	1.51	2.75	0	0	0	0
Total	0.37	0.35	0.35	0.32	0.30	0.27	0.27	0.26

IP: Individual Provision charge; CP: Collective Provision charge; CIC: Total Credit Impairment charge

Increase to New and Increased Individual Provisions and Writebacks & Recoveries compared to prior half is largely related to the home loan portfolio in Australia Retail and Commercial following the implementation of a more market responsive collateral valuation methodology

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COLLECTIVE PROVISION

COLLECTIVE PROVISION BALANCE

COLLECTIVE PROVISION CHARGE[1]

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$m
813 90 27 23 3,376
-79 -21
2,523
CP charge 17
Sep-18 Transition Volume / Change Economic Other FX/Other Sep-19
to AASB 9 Mix in Risk Outlook charge B’sheet
Sensitivity
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AASB9	AASB9	AASB9	AASB9
$m	1H19	2H19	FY19
CP charge 13 4 17
Volume/Mix -28 -51 -79 Change in Risk -40 19 -21 Economic outlook sensitivity 73 17 90 Other 8 19 27

COLLECTIVE PROVISION BALANCE

PROVISION BALANCE/COVERAGE RATIO

BY DIVISION ($m) AASB9

BY STAGES ($m) AASB9

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3,336 3,378 3,376
358 48 369 43 374 38
1,142 1,132 1,169
1,788 1,834 1,795
Sep-18 Mar-19 Sep-19
AUS Insto. NZ Other
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31 Mar-19

30 Sep-19

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Coverage ratio by stage [2] Coverage ratio by stage [2]
1 2 3 1 2 3
0.19% 3.31% 20.76% 0.17% 2.40% 18.03%
395 434
1,415 1,568 1,412 1,530
891 814
Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3
Stage 1 CP Stage 2 CP Stage 3 CP Stage 3 IP
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Change in methodology introduced in 2H19 to measure components of CP charge
Coverage ratio calculated as Provision Balance to Gross Loans & Advances for on-balance sheet exposures. Reduction in 2H19 stage 2 coverage ratio is a result of (a) Denominator effect: increased stage 2 GLA in Australian home loans due to implementation of a revised provisioning model plus higher delinquency levels, and (b) Numerator effect: stable stage 2 ECL with the home loan ECL increase offset by decreases for other Australian portfolios and Institutional

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RISK MANAGEMENT

IMPAIRED ASSETS

CONTROL LIST

GROSS IMPAIRED ASSETS BY DIVISION

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Index Sep 09 = 100
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150
100
50
0
Sep Sep Sep Sep Sep Sep Sep Sep Sep Sep Sep
09 10 11 12 13 14 15 16 17 18 19
Control List by Limits Control List by No. of Groups
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3,173
2,883 2,940
3,000
2,384
2,034 2,139 2,128 2,029
2,000
1,000
0.51% 0.55% 0.51% 0.41% 0.34% 0.33% 0.33% 0.33%
0
Mar-16 Sep-16 Mar-17 Sep-17 Mar-18 Sep-18 Mar-19 Sep-19
Australia [3] Institutional Group GIA/GLA (EOP)
New Zealand Other [1]
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NEW IMPAIRED ASSETS BY DIVISION

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$m
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GROSS IMPAIRED ASSETS BY EXPOSURE SIZE[3]

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2,000 1,784 1,844 1,787
1,425
1,500
1,145 1,117
1,000 963 890
500
0
1H16 2H16 1H17 2H17 1H18 2H18 1H19 2H19 [2]
Australia [2] New Zealand Institutional Other
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4,000
3,173
3,000 2,708 2,719 2,883 2,940
2,384
2,034 2,139 2,128 2,029
2,000
1,000
0
Mar-15 Sep-15 Mar-16 Sep-16 Mar-17 Sep-17 Mar-18 Sep-18 Mar-19 Sep-19
< 10m 10m to 100m > 100m
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Other includes Retail Asia & Pacific and Australian Wealth
New Impaired Assets in 2H19 includes a $167m uplift on 1H19 in Australia home loans following the implementation of revised provisioning and impairment processes (including a more market responsive collateral valuation methodology)

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The increase referred to in footnote 2 has been largely offset in Gross Impaired Assets by the return of previously impaired home loans to a past due but not impaired status

RISK MANAGEMENT

RISK WEIGHTED ASSETS

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TOTAL RISK WEIGHTED ASSETS 2H19 increase includes op. risk modelled increase
of +$3b combined with an overlay +$6.25b and
$b +$11.8b of CRWA methodology changes
417
409
388 397 391 396 391 396
39 47
38 39 37 37 38 38 358
18 12
16 17 17 16 16 13
CRWA
156
(Insto)
334 352 342 337 343 338 346 358
CRWA
202
(ex. Insto)
Mar-16 Sep-16 Mar-17 Sep-17 Mar-18 Sep-18 Mar-19 Sep-19 Sep-19
CRWA Mkt. & IRRBB RWA Op-RWA
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CRWA MOVEMENT Increase driven by SA-CCR implementation, a
regulatory overlay for Australia Home Loans as well as
implementation of APRA Risk Weight floors for New
$b Zealand Home Loan and Farm Lending Portfolios
14.3 1.3 358.1
4.5 0.4
337.6
Sep-18 FX Impact Lending Methodology Risk Sep-19
Mvmt. Review
GROUP EAD & CRWA GROWTH MOVEMENT [[1,2]]
Sep-19 v Sep-18
$b 21.9
5.9
3.3
0.3 0.6
-1.8 -3.4 -2.7 -1.3
-6.5
AUS HL AUS Non HL NZ Other Institutional
EAD growth CRWA growth
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CRWA MOVEMENT

GROUP EAD & CRWA GROWTH MOVEMENT[[1,2]]

Post CRM EAD, net of credit risk mitigation such as guarantees, credit derivatives, netting and financial collateral. Excludes amounts for ‘Securitisation’ and ‘Other Assets’ Basel asset classes 2. Refers to FX adjusted lending movement, excluding Methodology Review and Risk

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RISK MANAGEMENT

PORTFOLIO COMPOSITION

EXPOSURE AT DEFAULT (EAD) DISTRIBUTION

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TOTAL GROUP EAD (Sep-19)
= $977b [1]
5.8%
3.0%
7.3%
3.6%
5.1%
7.0%
20.3%
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37.6%
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Category	% of Group EAD	% of Group EAD	% of Group EAD	% of Portfolio in Non Performing	% of Portfolio in Non Performing	% of Portfolio in Non Performing	Portfolio Balance in Non Performing
	Sep-18	Mar-19	Sep-19	Sep-18	Mar-19	Sep-19	Sep-19
Consumer Lending	39.7%	38.8%	37.6%	0.2%	0.2%	0.1%	$549m
Finance, Investment & Insurance	19.6%	20.2%	20.3%	0.0%	0.1%	0.0%	$73m
Property Services	6.8%	7.0%	7.0%	0.3%	0.3%	0.2%	$158m
Manufacturing	4.6%	4.7%	5.1%	0.4%	0.3%	0.3%	$138m
Agriculture, Forestry, Fishing	3.7%	3.7%	3.6%	1.1%	1.1%	1.1%	$373m
Government & Official Institutions	6.9%	6.8%	7.3%	0.0%	0.0%	0.0%	$0m
Wholesale trade	3.0%	3.0%	3.0%	0.3%	0.3%	0.3%	$78m
Retail Trade	2.2%	2.2%	2.2%	0.9%	0.7%	0.7%	$157m
Transport & Storage	2.0%	2.1%	2.2%	0.2%	0.2%	0.3%	$75m
Business Services	1.6%	1.6%	1.6%	0.9%	1.0%	1.0%	$166m
Resources (Mining)	1.6%	1.6%	1.8%	0.3%	0.3%	0.2%	$40m
Electricity, Gas & Water Supply	1.2%	1.2%	1.3%	0.1%	0.1%	0.1%	$17m
Construction	1.4%	1.3%	1.3%	1.7%	1.8%	1.7%	$218m
Other	5.7%	5.7%	5.8%	0.4%	0.4%	0.4%	$224m
Total	100%	100%	100%				$2,267m
Total Group EAD1	$944b	$968b	$977b

EAD excludes amounts for ‘Securitisation’ and ‘Other Assets’ Basel classes. Data provided is on a Post CRM basis, net of credit risk mitigation such as guarantees, credit derivatives, netting and financial collateral

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RISK MANAGEMENT

COMMERCIAL PROPERTY PORTFOLIO

COMMERCIAL PROPERTY OUTSTANDINGS BY REGION

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$b
%
42.4 42.9
12
40.2 2.8 2.8
38.4 37.9 37.7 37.5 37.6 2.9 11
3.9 3.6 2.7 2.4 3.0 10
10.5
10.7
9.8 9
8.8 9.5 9.5 9.7 9.7
8
7
6
5
28.9 29.6 4
27.5
25.7 24.8 25.5 25.4 24.9
3
2
1
0
Mar-16 Sep-16 Mar-17 Sep-17 Mar-18 Sep-18 Mar-19 Sep-19
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% of Group GLA (RHS) Australia New Zealand APEA[1]

COMMERCIAL PROPERTY OUSTANDINGS BY SECTOR

% 100 80 60 40 20 Mar-17 Sep-17 Mar-18 Sep-18 Mar-19 Sep-19 Offices Retail Industrial Residential Tourism Other

PROPERTY PORTFOLIO MANAGEMENT

Australian exposure increased by 2% HOH driven by higher lending to Funds and REITs in the Industrial sector partly offset by a decline in Residential lending given the slowdown in the residential property market. Retail exposure declined over the half and the Retail portfolio continues to be closely monitored owing to the weak operating environment
Slight decline in New Zealand exposure was driven by exchange rate movements and some significant repayments occurring during 2H FY19
APEA exposure remained stable for 2H19 with the portfolio concentrated on large well rated names in Singapore and Hong Kong. The Hong Kong Property market has seen a 1% index decline given current unrest. Market consensus estimates a decline as high of 10-20% if the protests continue through the year. The Hong Kong property portfolio remains subject to close monitoring of internal and external metrics

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APEA = Asia Pacific, Europe & America

RESIDENTIAL DEVELOPMENT

OVERVIEW

Average qualifying pre-sales for Inner City Apartment Development loans and corresponding LVRs were 101% and 52%, respectively as at Sep 19 (as compared to presales of 101% and LVR of 49% in Mar 19). These loans remain subject to tight parameters around LVR, presale debt cover and quantum of foreign purchaser presales. Overall appetite for Apartment Development has remained unchanged over the last half. The quality and experience of developers and builders remains a key selection criterion.
Outside of Inner City locations, development exposures are predominantly in the suburbs of the capital cities of the above listed states.
Residential Development projects continue to be closely monitored with level of oversight driven by progress of the project vs. plan, industry trends and emerging risks.

	Sep-18 ($b)	Sep-19 ($b)
Total Exposure Apartments (>3 levels) Inner City	10.28 10.60 3.97 4.20 0.56 0.70

PROFILE (SEP-19)

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PROFILE (SEP-19) Total Residential Limits: $10.6b
31%
20%
Apartment Development
Other Development [1] 9%
Residential & Subdivision
Investment
40%
$0.67b inner
city apartment
Apartment Development
development
$4.20b
Melb
0.3
Bris
NSW and ACT
0.1
2.1
Syd
0.3
$3.54b other
apartment
development
0.9
VIC 0.4
0.2
QLD
Other
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Other Development primarily comprises Low Rise & Prestige Residential and Multi Project Development

RISK MANAGEMENT

GROUP AGRICULTURE PORTFOLIO

AGRICULTURE EXPOSURE BY SECTOR (% EAD)

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Total EAD (Sep-19) As a % of Group EAD
A$35.2b 3.6%
10.4%
12.8%
35.0%
17.7%
14.4%
9.6%
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Dairy Sheep & Other Horticulture/Fruit/ Livestock Other Crops Beef Grain/Wheat Forestry & Fishing/ Agriculture Services

GROUP AGRICULTURE EAD SPLITS[1]

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6.6%
3.3%
6.1%
3.0%
15.9% 14.9%
43.5% 44.9%
98.9% 98.9%
74.2% 76.0%
56.2% 54.9%
0.3% 0.2% 1.1% 1.1%
Sep-18 Sep-19
Sep-18 Sep-19 Sep-18 Sep-19
<60% Secured
Australia Productive 60 - <80% Secured
New Zealand Impaired 80 - <100% Secured
Intl. Markets Fully Secured
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NEW ZEALAND[2] DAIRY CREDIT QUALITY

FY19 PD increase driven by customer downgrades, reflecting continued headwinds facing the dairy sector

NZD $b

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12.3 11.9 12.5 13.3 13.3 12.9 12.8 12.8 12.3
1.22% 0.90% 0.80% 1.14% 2.21% 1.95% 1.51% 1.56% 1.91%
Sep-12 Sep-13 Sep-14 Sep-15 Sep-16 Sep-17 Sep-18 Mar-19 Sep-19
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Wt. Avg. Probability of Default

NZ Dairy EAD

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Security indicator is based on ANZ extended security valuations
Dairy exposures for all of ANZ New Zealand (includes Commercial and Agriculture, Institutional and Business Banking portfolios)

GROUP RESOURCES PORTFOLIO

TOTAL ANZ PORTFOLIO

RESOURCES PORTFOLIO

THERMAL COAL EXPOSURE

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EAD $b EAD $b
977 Resources:
944 17 1.8% of ANZs
898 895 903 15 20.0 total portfolio
20 16 14
1.7
0.6 17.3
1.3 16.1 0.8
15.3 0.7
1.2 1.0
532 516 515 554 593 2.9 0.41.1 0.814.0 0.70.70.9 1.5
0.3
1.7 1.0 1.2
4.9 1.4
5.2
4.0 4.4
3.5
347 363 375 375 367 8.6 7.8 7.0 7.4 8.2
Sep-15 Sep-16 Sep-17 Sep-18 Sep-19 Sep-15 Sep-16 Sep-17 Sep-18 Sep-19
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EAD $b
2.0
1.5
Thermal
coal 1.0
mining:
<0.1% of 0.5
ANZs total
portfolio 0.0
Sep-15 Sep-16 Sep-17 Sep-18 Mar-19 Sep-19
Thermal coal Thermal coal (Trendline)
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RESOURCES PORTFOLIO MANAGEMENT

Portfolio is skewed towards well capitalised and lower cost resource producers. 32% of the book is less than one year duration.

Investment grade exposures represent 79% of the portfolio vs. 68% at Sep 18. Increase in total coal mining exposure in FY19 primarily reflects mergers and acquisitions activity related to existing mines in 1H19, ie predominantly metallurgical coal assets sold by diversified miners to existing customers along with foreign currency exchange movements. Financing is mainly used to support continuing operations, and not mine expansions.

Thermal coal exposure is currently $838m. We expect our thermal coal exposure to decline over time, as it has since 2015 (reducing by 50% between FY15-FY19). Decreased exposure in 2H19 compared to 1H19 reflects ongoing portfolio management and application of ANZ policies. Our exposures to thermal coal are primarily concentrated in a small number of Australian-based miners.

Exposure to metallurgical coal mining (used for steel making) is currently $686m.

Consumer Lending Resources Other

Oil & Gas Extraction Other Mining Metal Ore Mining Metallurgical Coal Mining Services to mining Thermal Coal Mining

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RISK MANAGEMENT

ANZ INSTITUTIONAL PORTFOLIO (COUNTRY OF INCORPORATION[1] )

INSTITUTIONAL PORTFOLIO SIZE & TENOR (EAD[2] )

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$b
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400
350
49%
300
250
35%
200
150
51%
22%
100
65%
50 78%
15%
85%
0
Total Institutional International Asia China
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ANZ INSTITUTIONAL INDUSTRY COMPOSITION

EAD (Sep-19): A$447b[2]

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Finance (Banks and Central Banks)
Government Admin.
26%
30% Services to Fin. & Ins.
Property Services [3]
Basic Material Wholesaling
2%
3% Machinery & Equip Mnfg
3% Electricity & Gas Supply
4%
16% Petroleum Coal Chem & Assoc Prod Mnfg
8%
Other⁴
8%
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ANZ INSTITUTIONAL PRODUCT COMPOSITION

EAD (Sep-19) A$447b[2]

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12%
20%
0%
2%
25%
16%
25%
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Loans & Advances Traded Securities (e.g. Bonds) Contingent Liabilities & Commitments Trade & Supply Chain Derivatives & Money Market Loans Gold Bullion Other

Tenor < 1 Yr Tenor 1 Yr+

Country is defined by the counterparty’s Country of Incorporation 2. Data provided is as at Sep-19 on a Post CRM basis, net of credit risk mitigation such as guarantees, credit derivatives, netting and financial collateral. Position excludes Basel Asset Class ‘Securitisation’, ‘Other Assets’, ‘Retail’ and manual adjustments 3. ~90% of the ANZ Institutional “Property Services” portfolio is to entities incorporated in either Australia or New Zealand 4. Other is comprised of 47 different industries with none comprising more than 2.1% of the Institutional portfolio.

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RISK MANAGEMENT

ANZ ASIAN INSTITUTIONAL PORTFOLIO (COUNTRY OF INCORPORATION[1] )

COUNTRY OF INCORPORATION[1]

ANZ ASIA INDUSTRY COMPOSITION

EAD (Sep-19): A$121b[2]

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Finance (Banks & Central Banks)
19% Basic Material Wholesaling
Machinery & Equip Mnfg
2% Petroleum,Coal,Chem & Assoc Prod Mnfg
2%
2% Property Services
3%
Communication Services
60%
5%
Services To Finance & Insurance
6%
Other [3]
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5%
3%
3%
5% 26%
6%
8%
18% 26%
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ANZ ASIA PRODUCT COMPOSITION

EAD (Sep-19): A$121b[2]

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12% Loans & Advances
20%
0%
Traded Securities (e.g. Bonds)
Contingent Liabilities & Commitments
2%
21% Trade & Supply Chain
Derivatives & Money Market Loans
15%
Gold Bullion
Other
30%
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China Singapore Taiwan India Other Japan Hong Kong South Korea Indonesia

Country is defined by the counterparty’s Country of Incorporation 2. Data provided is as at Sep-19 on a Post CRM basis, net of credit risk mitigation such as guarantees, credit derivatives, netting and financial collateral. Position excludes Basel Asset Class ‘Securitisation’, ‘Other Assets’, ‘Retail’ and manual adjustments 3. “Other” within industry is comprised of 43 different industries with none comprising more than 2.2% of the Asian Institutional portfolio; Other product category is predominantly exposure due from other financial institutions

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2019 FULL YEAR RESULTS — INVESTOR DISCUSSION PACK HOUSING PORTFOLIO

AUSTRALIA HOME LOANS

PORTFOLIO OVERVIEW

		Portfolio1	Portfolio1	Flow2	Flow2			Portfolio1
	FY17	FY18	FY19	FY18	FY19		FY17	FY18	FY19
Number of Home Loan accounts1	1,009k	1,011k	983k	170k3	119k3	Average LVR at Origination7,8,9	69%	67%	67%
Total FUM1	$264b	$272b	$265b	$57b	$40b	Average Dynamic LVR (excl offset)8,9,10,11,12	55%	55%	57%
						Average Dynamic LVR (incl offset)8,9,10,11,12	50%	50%	52%
Average Loan Size4	$262k	$269k	$270k	$382k	$378k
						Market Share (MBS publication)13	15.7%	15.5%	n/a
% Owner Occupied5	63%	65%	67%	70%	73%
						Market share (MADIS publication)	n/a	n/a	14.3%
% Investor5	33%	32%	30%	29%	26%	% Ahead of Repayments14	71%	72%	76%
% Equity Line of Credit	4%	3%	3%	1%	1%	Offset Balances15	$27b	$28b	$27b
% Paying Variable Rate Loan6	83%	84%	84%	84%	78%	% First Home Buyer	7%	7%	8%
						% Low Doc16	4%	4%	4%
% Paying Fixed Rate Loan6	17%	16%	16%	16%	22%
						Loss Rate17	0.02%	0.02%	0.04%
% Paying Interest Only	31%	22%	15%	13%	11%
						% of Australia Geography Lending18,19	64%	63%	61%
% Broker originated	51%	52%	52%	55%	53%	% of Group Lending18	45%	45%	43%

Home Loans portfolio (includes Non Perfo ~~rming Loans, excludes Offset balances) 2. YTD unless noted 3. New ac~~ counts includes increases to existing accounts and split loans (fixed and variable components of the same loan) 4. Average loan size for Flow excludes increases to existing accounts (note the average loan size previously reported in 1H18 and prior included increases to existing accounts) 5. The current classification of Investor vs Owner Occupier is based on ANZ’s product category, determined at origination as advised by the customer and the ongoing precision relies primarily on the customer’s obligation to advise ANZ of any change in circumstances. 6. Excludes Equity Manager 7. Originated in the respective year 8. Unweighted 9. Includes capitalised LMI premiums 10. Valuations updated to Aug-19 where available 11. Includes Non Performing Loans and excludes accounts with a security guarantee 12. Historical DLVR has been restated as a result of enhancements to methodology 13. APRA Monthly ADI Statistics to Aug-19 – Note APRA changed the underlying market share definition in Jul-19 and historical periods (FY17 & FY18) are not comparable to FY19 14. % of Owner Occupied and Investment Loans that have any amount ahead of repayments. Includes Offset balances. Excludes Equity Manager. Includes Non Performing Loans 15. Balances of Offset accounts connected to existing Instalment Loans 16. Low Doc is comprised of less than or equal to 60% LVR mortgages primarily for self-employed without scheduled PAYG income. However, it also has ~0.1% of less than or equal to 80% LVR mortgages, primarily booked pre-2008 17. Annualised write-off net of recoveries 18. Based on Gross Loans and Advances 19. Australia Geography includes Australia Division, Wealth Australia and Institutional Australia

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AUSTRALIA HOME LOANS

PORTFOLIO GROWTH

HOME LOAN COMPOSITION[1,2]

LOAN BALANCE & LENDING FLOWS[1]

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256 264 271 272 269 265
10 9 9 8 8 7
37 31 26
43
49
54 14
17
22
29
33 54
52
38 49
44
39
33
161 164
156
146
134
121
Mar-17 Sep-17 Mar-18 Sep-18 Mar-19 Sep-19
OO P&I Inv P&I OO I/O Inv I/O Equity Manager
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16
29
272 -2 265
-50
Sep-18 New Sales Net OFI Refi Redraw & Repay / Other Sep-19
exc Refi-In Interest
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ANZ MORTGAGE LENDING PORTFOLIO CHANGE

FY19 v FY18	Owner Occupied3	Investor
Housing Portfolio -1% -7%

FY19 v FY18	Principal & interest3	Interest only
Housing Portfolio 6% -33%

Includes Non Performing Loans
The current classification of Investor vs Owner Occupier is based on ANZ’s product category, determined at origination as advised by the customer and the ongoing precision relies primarily on the customer’s obligation to advise ANZ of any change in circumstances

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Includes Equity Manager

AUSTRALIA HOME LOANS

MARKET SHARE

TOTAL HOUSING

OWNER OCCUPIED

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14.9% 15.6%
14.4% 14.9%
June 19 (MBS) June 19 (MADIS) June 19 (MBS) June 19 (MADIS)
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INVESTOR
13.8% 13.6%
June 19 (MBS) June 19 (MADIS)
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In July 2019 the APRA Monthly Authorised Deposit Institution Statistics (MADIS) publication replaced the APRA Monthly Banking Statistics (MBS) publication. Under the new publication, changes in the market cohort and changes in definitions impacted housing market share for ADIs when compared with the previous MBS publication. With respect to the housing categories, three noteworthy changes included:

Inclusion of building societies, credit unions and other ADIs, resulting in an increase in FUM within the total system, consequently reducing market share of ADIs relative to market share under the MBS publication
Change in the definition of what is included within the housing categories (for ANZ total housing reduced by $8.2b (June 2019) within the MADIS publication compared with the MBS publication)
Changes to definition of Owner-Occupied and Investment housing based on housing purpose[1]
APRA MADIS definition: Loans to households: Housing: Owner-occupied are loans to resident households for the purpose of housing, where the funds are used for a residential property that is occupied or to be occupied by the borrower(s) as their principal place of residence. The principal place of residence means the residential property at which an individual resides for the majority of the year. Loans to households: Housing: Investment are loans to resident households for the purpose of housing, where the funds are used for a residential property that is not owner-occupied.

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AUSTRALIA HOME LOANS

PORTFOLIO[1,2] & FLOW[3] COMPOSITION

BY PURPOSE

BY ORIGINATION LVR[4]

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Portfolio Flow
4% 3% 3% 1%
26%
33% 32% 30%
63% 65% 67% 73%
Sep-17 Sep-18 Sep-19 FY19
Owner Occ Investor Equity
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Flow

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20% 18% 17%
19% 17% 16%
61% 65% 67%
FY17 FY18 FY19
<80% LVR 80% LVR >80% LVR
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BY LOCATION

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Flow
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Portfolio Flow
7% 6% 6% 6%
14% 13% 13% 9%
14%
16% 16% 16%
31%
31% 32% 32%
40%
32% 33% 33%
Sep-17 Sep-18 Sep-19 FY19
VIC/TAS NSW/ACT QLD WA SA/NT
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BY CHANNEL

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Portfolio Flow
$264b $272b $265b $67b
$57b
49% 48% 48% 44%
45% $40b
47%
51% 52% 52% 56% 55%
53%
Sep-17 Sep-18 Sep-19 FY17 FY18 FY19
Broker Proprietary
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Includes Non Performing Loans. 2. The current classification of Investor vs Owner Occupier is based on ANZ’s product category, determined at origination as advised by the customer and the ongoing precision relies primarily on the customer’s obligation to advise ANZ of any change in circumstances 3. YTD unless noted 4. Includes capitalised LMI premiums

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AUSTRALIA HOME LOANS

PORTFOLIO DYNAMICS

HOME LOANS REPAYMENT PROFILE[1,2]

HOME LOANS ON TIME & <1 MONTH AHEAD PROFILE[1,2]

76% of accounts ahead of repayments

% composition of accounts (September 19)

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27%
20% 21% 38 37
21 19
9% 12
6% 6% 7% 14
4%
27 32
Overdue On Time <1 month 1-3 months 3-6 months 6-12 months 1-2 years >2 years Sep-18 Sep-19
ahead ahead ahead ahead ahead ahead
Sep-15 Sep-16 Sep-17 Sep-18 Sep-19
DYNAMIC LOAN TO VALUE RATIO [3,4,6,7]
% of portfolio
60 91%+ DLVR Total Portfolio
by State by FUM
50
40 6% 6%
13%
30%
30 16%
16%
20 32%
26%
10
33%
22%
0
0-60% 61-75% 76-80% 81-90% 91-95% 96-100% 100%+ Sep-19 Sep-19
VIC/TAS QLD SA/NT
Mar-17 Sep-17 Mar-18 Sep-18 Mar-19 Sep-19 NSW/ACT WA
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Investment :[5] Interest payments may receive negative gearing/tax benefits

New Accounts : Less than 1 year old

Structural: Loans that restrict payments in advance. E.g. fixed rate loans Residual: Less than 1 month repayment buffer

NEGATIVE EQUITY

Net of offset balances

Represents 4.8% of portfolio
Skew to mining states – WA, QLD & NT represent 65% of negative equity
59% ahead of repayments
47% with LMI
Includes Non Performing Loans 2. % of Owner Occupied and Investment Loans that have any amount ahead of repayments. Includes Offset balances. Excludes Equity Manager. Includes Non Performing Loans 3. Includes capitalised LMI premiums 4. Valuations updated to Aug’19 where available 5. The current classification of Investor vs Owner Occupier, is based on ANZ’s product category, determined at origination as advised by the customer and the ongoing precision relies primarily on the customer’s obligation to advise ANZ of any change in circumstances 6. Historical DLVR has been restated as a result of enhancements to methodology 7. Includes Non Performing Loans and excludes accounts with a security guarantee

AUSTRALIA HOME LOANS

PORTFOLIO PERFORMANCE

PRODUCT 90+ DAY DELINQUENCIES[1,2,3]

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%
5.0
4.0
3.0
2.0
1.0
0.0
Sep Sep Sep Sep Sep Sep Sep Sep
12 13 14 15 16 17 18 19
Home Loans Personal Loans
Consumer Cards Corporate & Commercial [4]
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HOME LOAN DELINQUENCIES[1,2,5]

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%
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2.5
2.0
1.5
1.0
0.5
0.0
Sep Sep Sep Sep Sep Sep Sep Sep
12 13 14 15 16 17 18 19
30+ DPD % 90+ Investor
90+ Owner Occupied
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HOME LOANS 90+ DPD BY STATE[1,2]

HOME LOANS - 90+ DPD (BY VINTAGE)[6]

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%
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2.5
2.0
1.5
1.0
0.5
0.0
VIC & TAS NSW & ACT QLD WA SA & NT Portfolio
Mar-12 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Mar-18 Mar-19
Sep-12 Sep-13 Sep-14 Sep-15 Sep-16 Sep-17 Sep-18 Sep-19
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%
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Note: FY14 vintages and prior were impacted by hardship prior to policy solutions put in place and therefore not comparable to FY15 vintages and onwards

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2.5
2.0
1.5
1.0
0.5
0.0
6 8 10 12 14 16 18 20 22 24 26 28 30 32 34 36
FY15 FY17 FY19 Month on book
FY16 FY18
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Includes Non Performing Loans 2. ANZ delinquencies calculated on a missed payment basis 3. For Personal Loans, a new collections platform was implemented in Aug-18 enabling automated charge-off of late stage accounts. This resulted in a step change to 90+ rates. Following this, compatibility issues between systems resulted in an accumulation of 90+ debt not being charged-off, causing the 90+ rate to increase. This issue has now been resolved and the 90+ rate has returned to expected levels in FY19 4. Retail portfolio (Small Business, Commercial Cards and Asset Finance) 5. The current classification of Investor vs Owner Occupier, is based on ANZ’s product category, determined at origination as advised by the customer and the ongoing precision relies primarily on the customer’s obligation to advise ANZ of any change in circumstances 6. Home loans 90+ DPD vintages represent % ratio of over 90+ delinquent (measured by # accounts), contains at least 6 application months of that fiscal year contributing to each data point

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AUSTRALIA HOME LOANS

WESTERN AUSTRALIA

Exposure to WA has decreased since Mar-16 driven by the economic environment and credit policy tightening (mining town lending)
Currently WA comprises 13% of portfolio FUM (and is decreasing), however it comprises 27% of 90+ delinquencies (and one half of portfolio losses[1] )
Tailored treatment of collection and account management strategies in place

Economic indicators2	2012	2013	2014	2015	2016	2017	2018	2019
Unemployment rate	3.9%	4.7%	5.0%	6.1%	6.3%	5.6%	6.1%	6.1%
SFD3 growth	13.8%	1.5%	-1.8%	-1.3%	-7.3%	-3.9%	0.3%	-0.9%
Population Growth	3.1%	2.2%	1.1%	0.85%	0.63%	0.71%	0.88%	-

WA OUTSTANDING BALANCE

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$b
40
2 2 2 2 2 2 2 2 1 1 1 1
30
20 21 21 22 22 23 23 23 25 26 27 28 29
10
11 11 12 12 12 12 11 10 8 6 5 4
0
Mar-14 Sep-14 Mar-15 Sep-15 Mar-16 Sep-16 Mar-17 Sep-17 Mar-18 Sep-18 Mar-19 Sep-19
Interest Only P&I Loan Equity Loan
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HOME LOANS AND WA 90+ DELINQUENCIES[4,5]

HOME LOANS COMPOSITION OF LOSSES[1]

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%
3.0
2.5
2.0
1.5
1.0
0.5
0.0
Sep Mar Sep Mar Sep Mar Sep Mar Sep Mar Sep Mar Sep
13 14 14 15 15 16 16 17 17 18 18 19 19
WA 90+ Rate Portfolio 90+ Rate without WA
Portfolio 90+ Rate
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35%
55% 57% 48% 51% 49% 44% 51%
73%
65%
45% 43% 52% 49% 51% 56% 49%
27%
2H15 1H16 2H16 1H17 2H17 1H18 2H18 1H19 2H19
WA Rest of the portfolio
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Losses are based on New Individual Provision Charges 2. Unemployment Rate as at September 3. State Final Demand (year on year growth) 4. Includes Non Performing Loans 5. ANZ delinquencies calculated on a missed payment basis

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AUSTRALIA HOME LOANS

NEW SOUTH WALES/ACT

Portfolio

NSW/ACT makes up 32% of portfolio FUM and 25% of 90+ days past due.
76% in advance of repayments which is in line with the total portfolio.
18% of the portfolio is Interest Only & reducing.

90+ days past due

NSW/ACT at 88bps is similar to VIC/TAS at 86bps & 28bps below national level.
Increase in the past 6 months, primarily driven by older vintages
• Since FY15, credit quality has improved year-on-year, with FY17 & FY18 vintages performing better than FY15 & FY16 vintages.

Dynamic LVR

12.2% of NSW/ACT portfolio >90% DLVR

HOUSING FLOW

HOUSING PORTFOLIO[1]

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$b $b
256 264 271 272 269 265
34 34
177 181 184 184 182 179 31
26
21
21 21 19
20
17
14 13
79 83 87 88 87 86 13 13 11 9 7 6
Mar-17 Sep-17 Mar-18 Sep-18 Mar-19 Sep-19 1H17 2H17 1H18 2H18 1H19 2H19
Rest of the Country NSW/ACT
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HOME LOANS AND NSW/ACT 90+ DELINQUENCIES[1,2]

NSW/ACT DYNAMIC LVR PROFILE – SEPTEMBER 2019[1,3,4,5 ]

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%
1.5
1.0
0.5
0.0
Sep Mar Sep Mar Sep Mar Sep Mar Sep Mar Sep Mar Sep
13 14 14 15 15 16 16 17 17 18 18 19 19
NSW/ACT 90+ Rate Portfolio 90+ Rate without NSW/ACT
Portfolio 90+ Rate
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60
50
40
30
20
10
0
0-60% 61-75% 76-80% 81-90% 91-95% 96-100% 100%+
Total Portfolio Total Portfolio (ex WA) NSW/ACT
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Includes Non Performing Loans 2. ANZ delinquencies calculated on a missed payment basis 3. Includes capitalised LMI premiums 4. Valuations updated to Aug-19 where available 5. Includes Non Performing Loans and excludes accounts with a security guarantee

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AUSTRALIA HOME LOANS

INTEREST ONLY

INTEREST ONLY FLOW COMPOSITION

Serviceability assessment is based on ability to repay principal & interest repayments calculated over the residual term of loan
86% of Interest Only customers have net income >$100k p.a. (portfolio 66%)
Historical policy & pricing changes have led to a reduction in Interest Only lending. ANZ’s Interest Only flow composition is 11% for 2H19.
Proactive contact strategies are in place to prepare customers for the change in their repayments ahead of Interest Only expiry

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%
APRA’s 30% limit removed December 2018
42
38
27
14 13 12 11
2H16 1H17 2H17 1H18 2H18 1H19 2H19
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SWITCHING INTEREST ONLY TO P&I AND SCHEDULED INTEREST ONLY TERM EXPIRY[1,2]

DYNAMIC LVR PROFILE OF 12 MONTH FORWARD CONVERSIONS[3]

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%
4
8
3
4 27 26
3
2 18
6 7 7 9 8 6 8 8 7 6 12 7 10
4 4 3
1H17 2H17 1H18 2H18 1H19 2H19 1H20 2H20 1H21 2H21 1H22 2H22 1H23+ 0-60% 61-75% 76-80% 81-90% 91-95% 95%+
Contractual conversions Early conversions Contractual (still to convert)
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Total portfolio including new flows 2. As at Sep-19 3. Includes Non Performing Loans and excludes accounts with a security guarantee

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100

AUSTRALIA HOME LOANS

UNDERWRITING PRACTICES AND POLICY CHANGES[1]

Multiple checks during origination process

End-to-end home lending responsibility managed within ANZ
Effective hardship & collections processes

Pre – application[2] Income & Expenses Application Know Your Customer Income Verification Income Shading Serviceability Expense Models Interest Rate Buffer Repayment Sensitisation LVR Policy Collateral / LMI Policy Valuations Valuations Policy Credit Credit History Assessment Bureau Checks Documentation Fulfilment Security

Full recourse lending
ANZ assessment process across all channels

Serviceability

Aug'15	Interest rate floor applied to new and existing mortgage lending introduced at 7.25%
Apr'16	Introduction of an income adjusted living expense floor (HEM*)
	Introduction of a 20% haircut for overtime and commission income
	Increased income discount factor for residential rental income from 20% to 25%
Nov’18	Enhanced Responsible Lending processes including additional enquiry and increase in minimum monthly credit card expense
Jul’19	Increase of interest rate buffer to 2.50% and reduction of interest rate floor to 5.50%

*The HEM benchmark is developed by the Melbourne Institute of Applied Economic and Social Research (‘Melbourne Institute’), based on a survey of the spending habits of Australian families.

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2015 to 2019 material changes to lending standards and underwriting
Customers have the ability to assess their capacity to borrow on ANZ tools

101

AUSTRALIA HOME LOANS

- UNDERWRITING PRACTICES AND POLICY CHANGES[1 ] JUNE 2015 TO SEPTEMBER 2019

ANZ LVR Caps

LVR cap reduced to 70% in high risk mining towns in June 2015; reduced to 90% for investment loans (July 2015)
Restricted new housing lending (new security to ANZ) to max. 80% LVR for all apartments within 7 inner city Brisbane postcodes (October 2017)
Restricted investment lending (new security to ANZ) to max 80% LVR for all apartments within 4 inner city Perth postcodes (October 2017)
Increase maximum LVR on interest only investment loans from 80% to 90% in March 2019 (excluding Mining towns and Apartment restrictions)

ANZ Assessment

Interest rate floor (new & existing lending) at 7.25% (August 2015)
Income adjusted living expense floor (HEM); 20% haircut for overtime & commission; Increased income discount factor for residential rental income from 20% to 25% (April 2016)
Limited acceptance of foreign income to demonstrate serviceability and tightened controls on verification (September 2016)
Minimum default housing expense (rent/board) applied to all borrowers not living in their own home & seeking RILs[2] or EMAs[3] (July 2017)
IO renewals became Credit Critical events (full income verification & serviceability test) including P&I to IO & converting to or extending IO term (March 2018)
Enhanced Responsible Lending Requirements including additional enquiry and increase in minimum monthly credit card expense (November 2018)
• Interest rate floor (new & existing lending) at 5.50% and interest rate buffer of 2.50% (July 2019)

ANZ Product and Other Limitations

Decreased max. IO term of owner occupied loans to 5 years (January 2017)
Withdrew lending to non-residents (September 2016); tightened acceptances for guarantees (December 2016); clarified residential lending to trading companies is not acceptable (December 2017)
Increased maximum term of interest only investment loans from 5 to 10 years (from March 2019)

DRIVERS OF REDUCTION IN CUSTOMER BORROWING CAPACITY (v 2015)[4]

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30% reduction in
>20% reduction in
borrowing capacity
borrowing capacity
Contribution
to reduction
in borrowing
capacity
Sep-18 Sep-19
HEM changes Servicing rate floor or buffer Income haircuts
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ANZ PORTFOLIO BORROWING CAPACITY SUMMARY[5]

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----- Start of picture text -----

10% of
customers
borrowing at
their
maximum
capacity
FY16 FY17 FY18 FY19
Customers with additional borrowing capacity Customers borrowing at maximum capacity
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2015 to 2019 material changes to lending standards and underwriting 2. Residential Investment Loans 3. Equity Manager Accounts. 4. ANZ modelled outcome of 4 borrowing scenarios indexed to 2015 and using a customer lending rate of 3.90%: i. Couple, no dependents, ii. Single, no dependents, iii. Couple 2 dependents, iv. Couple, no dependents, higher income earners, where application parameters such as income are held steady while policy components are adjusted based on 2015 and 2019 settings. 5. Based on financial years.

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102

AUSTRALIAN HOME LOANS

STRESS TESTING THE AUSTRALIAN MORTGAGE PORTFOLIO

ANZ conducts regular stress tests of its loan portfolios to meet risk management objectives and satisfy regulatory requirements.
Stress tests are highly assumption-driven; results will depend on economic assumptions, on modelling assumptions, and on assumptions about actions taken in response to the economic scenario.
This illustrative recession scenario assumes significant reductions in consumer spending and business investment, which lead to eight consecutive quarters of negative GDP growth. This results in a significant increase in unemployment and material nationwide falls in property prices.
Estimated portfolio losses under these stressed conditions are manageable and within the Group’s capital base, with cumulative total losses at $2.7b over three years (net of LMI recoveries).
The results have marginally improved from the stress test six months ago. Key reason for the stressed losses reduction is the improved property price outlook and the impact of the three rate cuts since May 2019, which are reflected in the underlying scenario.

Assumptions	Base1	Year 1	Year 2	Year 3
Unemployment rate	5.1%	5.5%	9.8%	10.5%
Cash Rate	1.5%	0.25%	0%	0%
Real GDP year ended growth	1.9%	0%	-4.7%	-0.6%
Cumulative
reduction in	-	-32.3%	-38.8%	-31.7%
house prices
Portfolio size ($b)	295	294	287	278

Outcomes		Year 1	Year 2	Year 3
Net Losses ($m)		286	1,282	1,141
Net losses (bps)		10	45	41

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Based on mortgage exposure at default and conditions as at 31 March 2019

103

LENDERS MORTGAGE INSURANCE

SEPTEMBER FULL YEAR 2019 RESULTS

LMI & REINSURANCE STRUCTURE

Australian Home Loan portfolio LMI and Reinsurance Structure at 30 Sep 19 (% New Business FUM Oct-18 to Sep-19)

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Gross Written Premium ($m) $80.7m
Net Claims Paid ($m) $31.4m
Loss Rate (of Exposure - annualised) 12.0bps
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ANZLMI MAINTAINED STABLE LOSS RATIOS[1]

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----- Start of picture text -----

%
150
100
50
0
-50
FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18
Industry ANZ LMI Insurer 1 Insurer 2 Insurer 3
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LVR<80% Not
LMI Insured
86%
9% 7%
LVR 80% to 90% LMI Insured LVR > 90% LMI Insured
Aggregate Stop Loss [2]
Quota Share [3]
Arrangement on
Arrangement
Net Risk Retained
(LVR > 90%)
(LVR > 80%)
2019 Reinsurance Arrangement
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ANZLMI uses a diversified panel of reinsurers (10+) comprising a mix of APRA authorised reinsurers and reinsurers with highly rated security

Reinsurance is comprised of a Quota Share arrangement3 with reinsurers for mortgages 90% LVR and above and in addition an Aggregate Stop Loss arrangement2 for policies over 80% LVR

Negative Loss ratios are the result of reductions in outstanding claims provisions. Source: APRA general insurance statistics (loss ratio net of reinsurance) 2. Aggregate Stop Loss arrangement – reinsurer indemnifies ANZLMI for an aggregate (or cumulative) amount of losses in excess of a specified aggregate 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 3. Quota Share arrangement - reinsurer assumes an agreed reinsured % whereby reinsurer shares all premiums and losses accordingly with ANZLMI

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104

NEW ZEALAND HOME LOANS

PORTFOLIO OVERVIEW[1]

	Portfolio	Portfolio	Portfolio	Flow
	FY17	FY18	FY19	FY19
Number of Home Loan Accounts Total FUM Average Loan Size2 % Owner Occupied % Investor % Paying Variable Rate Loan3 % Paying Fixed Rate Loan3 % Paying Interest Only % Paying Principal & Interest % Broker Originated4	520k 526k 527k NZD77b NZD81b NZD85b NZD148k NZD153k NZD161k 73% 74% 75% 27% 26% 25% 21% 18% 15% 79% 82% 85% 22% 21% 19% 78% 79% 81% 35% 36% 38%			118k
				NZD19b
				NZD157k
				77%
				23%
				14%
				86%
				19%
				81%
				40%

	Portfolio	Portfolio	Portfolio
	FY17	FY18	FY19
Average LVR at Origination2 Average Dynamic LVR2 Market Share5 % Low Doc6 Home Loan Loss Rates % of NZ Geography Lending	59% 58% 56% 43% 41% 42% 31.1% 30.9% 30.7% 0.44% 0.38% 0.34% (0.01%) 0.00% 0.00% 61% 62% 63%

New Zealand Geography
Average data as of September 2019
Flow excludes revolving credit facilities
Flow FY19 11 months to August 2019
Source: RBNZ, FY19 share of all banks as at August 2019
Low documentation (low doc) lending allowed customers who met certain criteria to apply for a mortgage with reduced income confirmation requirements. New low doc lending ceased in 2007

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105

NEW ZEALAND HOME LOANS

HOME LENDING & ARREARS TRENDS[1]

NZ DIVISION 90+DAYS DELINQUENCIES

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%
1.5
1.0
0.5
0.0
Sep- Sep- Sep- Sep- Sep- Sep- Sep- Sep- Sep- Sep- Sep- Sep-
08 09 10 11 12 13 14 15 16 17 18 19
Home Loans Commercial Agri
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HOUSING FLOWS[2]

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34% 39% 40%
66% 61% 60%
FY17 FY18 FY19
Proprietary Broker
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HOUSING PORTFOLIO

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21% 18% 15%
79% 82% 85%
Sep-17 Sep-18 Sep-19
Fixed Variable
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MARKET SHARE[3]

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HOUSING PORTFOLIO BY REGION
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ANZ HOME LOAN LVR PROFILE[5]

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----- Start of picture text -----

31.1% 31.0% 30.9% 30.9% 30.7%
5% 5%
5%
21% 20% 20%
11% 11% 11%
2.7%2.8% 2.4% [2.8%] 2.9%2.9% 3.0%3.0% 2.8% 10% 7% 11% 7% 11% 7%
2.0%
46% 46% 46%
2H17 1H18 2H18 1H19 2H19 Sep-17 Sep-18 Sep-19
ANZ market share System growth Auckland Christchurch Other Nth Is.
ANZ growth Wellington Other Sth Is. Other [4]
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----- Start of picture text -----

2% 2%
2%
4% 3% 4%
13% 13% 15%
19% 18% 19%
62% 64% 60%
Sep-17 Sep-18 Sep-19
0-60% 71-80% 90%+
61-70% 81-90%
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New Zealand Geography 2. Flow FY19 11 months to August 2019 3. Source: RBNZ, 2H19 market share as at August 2019 4. Other includes loans booked centrally (Business Direct, Contact Centre, Lending Services, Property Finance) 5. Dynamic basis

106

2019 FULL YEAR RESULTS — INVESTOR DISCUSSION PACK ROYAL COMMISSION UPDATE & REGULATORY REFORMS

ROYAL COMMISSION

OUR APPROACH, OUR RESPONSE

WE ARE RESPONDING TO THE ‘SPIRIT AND THE LETTER’ OF THE ROYAL COMMISSION.

Initial response

Committed in February 2019 to sixteen actions that we can take now including:
removing overdrawn and dishonour fees on our Pensioner Advantage account
improving our service to Indigenous customers in remote communities by setting up a dedicated phone service and giving them easier options to prove their identity
publishing principles to help family farming customers in financial distress
publishing principles on acting as a model litigant in disputes with our customers
implementing pay reforms that replace individual-based bonuses for most of our employees with an incentive based on the overall performance of the Group
Reviewed individual cases highlighted at the Commission and taken action where appropriate to resolve the matters
Reported to Government that we have made significant progress on the RC recommendations directed at banks, concerning distressed agricultural loans, remuneration of front line staff, the Sedgwick Review and changing culture and governance

Lessons from our experience

Identified eight lessons from our misconduct and failures to meet community standards and expectations to inform our response to the ‘spirit and letter’ of the Royal Commission
Now identifying measures that will allow us to be confident that these lessons have been acted on

Governance – aligned to the APRA self-assessment

Established a Royal Commission and Self-Assessment Oversight Group to oversee an integrated response to the Royal Commission and SelfAssessment. The Oversight Group is chaired by the Deputy Chief Executive Officer and includes the Group Chief Risk Officer

Constructive engagement with reform

Engaging constructively with Government and its agencies as they implement the recommendations directed at them
Government has indicated that majority of its reforms will be consulted on and introduced into Parliament by the end of 2020

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108

STRENGTHENING OUR RISK CULTURE

We have strengthened the way we deal with risk events through an enhanced Accountability and Consequence Framework, which is applicable to all of our people.
In 2019 across the Group, 151 employees were dismissed for breaches of our Code of Conduct. A further 516 employees received a formal disciplinary outcome, with managers required to apply impacts to their performance and remuneration outcomes as part of the annual review process.
At the senior leadership level, 30 current or former senior leaders (senior executives, executives and senior managers) received a consequence in 2019 for Code of Conduct breaches or findings of accountability for a material event, or otherwise left the bank after an investigation had been initiated.

SENIOR LEADER CONSEQUENCES IN 2019*

Remuneration consequence	23
Warning/advice	12
No longer employed	7

Individuals are included under all categories that are relevant, meaning one individual may be reflected in multiple categories.
The 30 employees represent ~ 1% of the senior leader population. The consequences applied included warnings, impacts to performance and/or remuneration outcomes and cessation of employment.

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109

2019 FULL YEAR RESULTS — INVESTOR DISCUSSION PACK CORPORATE OVERVIEW & ENVIRONMENT, SOCIAL AND GOVERNANCE (ESG)

– ESG GOVERNANCE OVERVIEW

BOARD OF DIRECTORS

Chaired by David Gonski, Chairman

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Audit Committee Risk Committee Ethics, Environment, Digital Business Human Resources Nomination and
Social and Technology Committee Board Operations
and Governance Committee Committee
Committee
Chair: Chair: Chair: Chair: Chair: Chair:
Paula Dwyer Graeme Liebelt David Gonski Jane Halton Ilana Atlas David Gonski
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Ethics and Responsible Business Committee (ERBC) Chaired by Shayne Elliott, CEO

Customer Fairness Advisor, Royal Commission & SelfAustralia Assessment Oversight Group Reports to Shayne Elliott, CEO Chaired by Kevin Corbally, CRO and Alexis George, DCEO

Customer Advocate, Australia Reports to Mark Hand, Group Executive, Australia Retail and Commercial Banking

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111

BOARD AND EXECUTIVE COMMITTEES WORK TOGETHER

INDICATIVE RESPONSIBILITIES DEMONSTRATE HOW COMMITTEES MANAGE ESG

Ethics, Environment, Social and Governance Board committee

Ethics and Responsible Business Management committee

Purpose: Establish ethical and ESG guidelines and principles

Purpose: Operationalise Board objectives and make decisions on issues and policies

Oversight of measures to Review and monitor advance Purpose and the ethical, environmental, Ethics and Responsible social and governance risks Business Committee and opportunities Review of complaints Code of Conduct review themes and potential systemic issues Oversight and approval of corporate governance Oversight and approval of policies, principles, ESG reporting and targets regulatory and policy responses

Consider and decide on ethical, environmental, social and governance risks and opportunities

Purpose, reputation and values review

Set Social and Examine complaints Environmental Risk policy themes and potential and monitor systemic issues implementation Monitor and determine Set ESG targets and sensitive customer monitor progress transactions

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112

BRINGING OUR PURPOSE TO LIFE

CHOICES ABOUT WHO WE SERVE

WHO we bank
HOW we bank
WHAT we care about

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CHOICES ABOUT HOW WE OPERATE

HOW we organise ourselves
HOW we behave
HOW we measure & communicate our progress

WHAT WE CARE ABOUT

Housing

Our focus … Leading to … Homes to Buy Home ownership Homes to Rent Housing choice Access to Housing Housing security

Environmental Sustainability Our focus … Leading to … Energy Lower carbon emissions Water Water stewardship Waste Waste minimization

Financial Wellbeing

Our focus … Leading to … Financial Access Economic participation Financial Fitness Financial health

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113

‘WHAT WE CARE ABOUT MOST’ – A YEAR IN REVIEW

Build leadership in key areas Ensure ANZ is living up to its commitments Continue to improve housing, environment and financial wellbeing outcomes for the community	More Australians and New Zealanders have access to affordable, liveable, sustainable housing	• Joint Lead Manager on $315m National Housing Finance and Investment Corporation bond, and NZD$500m and NZD$600m bonds for Housing New Zealand to provide new and upgraded social housing • Provided >1,800 interest-free loans to improve the health of New Zealand households through our New Zealand ‘Healthy Homes’ initiative
	The food, beverage and agricultural sector is more sustainable and financially resilient	• Supported the purchase of the Great Cumbung Swamp - Australia’s largest purchase of mixed-use conservation and agricultural property by dollar value • Advisor and Joint Lead Manager on $400m green bond for Woolworths Group to improve energy efficiency (solar, lighting, refrigeration systems) in its supermarkets
	Australia’s energy supply, transmission and distribution is more efficient, cleaner and affordable	• Project finance commitment to renewable energy increased ~27% from FY18 $1,076m to FY19 $1,371m (figure quoted is project finance made on a non or limited recourse basis and excludes corporate debt facilities)

	Improve our standards and practices	• Established a $100m Housing ‘Virtual Fund’ to support the financing of more affordable, secure and sustainable homes • Committed to 100% renewable electricity across our global premises by 2025
	Develop products and services	• Expanded sustainable finance offering to establish sustainability-linked loans market in Australia and New Zealand • Continued expansion of Home Buyers Coach training, currently >3,300 home coaches active in Australia and New Zealand
	Use insights, advocacy and partnerships	• Delivered new housing market insights with bi-annual ANZ-Core Logic Housing Affordability Report • Conducted research to assess the impact of Money Minded on financial wellbeing

	Alleviate homelessness	• Supported youth employment through the opening of two social enterprise cafés: Home.Two and STREAT • Raised >$150k for the St Vincent de Paul ‘CEO Sleepout’ - equivalent to providing >5,000 meals for those experiencing homelessness
	Connect to the environment	• Over 18,000 hours volunteered by employees towards environmental sustainability • More than 1,250 employees volunteered with Sustainable Coastlines New Zealand collecting more than 10,000 litres of rubbish
	Facilitate financial inclusion	• Through ANZ Technology ‘Return to Work’ program we employed 30 women who had been out of the workforce for an extended period • Improved the financial literacy of >87,500 people through our Money Minded program

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CREATING VALUE FOR OUR STAKEHOLDERS

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CUSTOMERS

8.7m total retail, commercial and Institutional customers

EMPLOYEES

$291b in retail & commercial customer deposits in Australia and New Zealand
39,060 people employed (FTE)
$339b in home lending in • 734 people recruited from Australia and New Zealand under-represented groups, including refugees, people
• Full mobile wallet offering , with disability and Indigenous including Apple Pay[[TM]] , Australians since 2016
Full mobile wallet offering , including Apple Pay[[TM]] , GooglePay[TM] , Samsung Pay[TM] , FitBit Pay[TM] and Garmin Pay[TM]
32.5% of women in leadership, increase from 27.9% in Sep 2014[2]
#1 Lead bank for trade services[1]

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COMMUNITY

$142m contributed in community investment[3]
134,930 volunteering hours completed by employees
$3.2b in taxes incurred; money used by governments to provide public services and amenities[4]
>998k people reached through our target to help enable social and economic participation[5]

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SHAREHOLDERS

>500,000 Retail & Institutional shareholders
$6.5b[6] cash profit reported
227.6 cents earnings per share
160 cents per share dividend for FY19[7]
10.9% return on average ordinary shareholders equity
~1.5m hours of training undertaken

All financial metrics are as at 30 September 2019 (P&L growth metrics for the full year ended 30 September 2019) unless otherwise stated.

Peter Lee Associates Large Corporate and Institutional Transactional Banking Surveys, Australia 2004-2019 and New Zealand 2005-2019 2. Measures representation at the Senior Manager, Executive and Senior Executive Levels. Includes all employees regardless of leave status but not contractors (which are included in FTE) 3. Figure includes foregone revenue of $109 million 4. Total taxes borne by the Group, includes unrecovered GST/VAT, employee related taxes and other taxes. Inclusive of discontinued operations 5. Through our initiatives to support financial wellbeing including financial inclusion, employment and community programs, and targeted banking products and services for small businesses and retail customers 6. On a cash profit continuing operations basis 7. FY19 franking average 85%

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115

FY19 ESG TARGET PERFORMANCE

SCORECARD SNAPSHOT

SCORECARD SNAPSHOT	SCORECARD SNAPSHOT	SCORECARD SNAPSHOT	SCORECARD SNAPSHOT
Achieved In progress Not achieved We are committed to the United Nations Sustainable Development Goals (SDGs). Our ESG targets support 10 of the 17 SDGs.
ESG target	Progress	Outcome	Relevant SDGs
FAIR AND RESPONSIBLE BANKING Implement new Dispute Resolution Principles in Australia Implemented

Communicate with >700,000 of our retail and commercial customers by 2019 to help them get more value from our products and services and establish positive financial behaviours >1 million
ENVIRONMENTAL SUSTAINABILITY Fund and facilitate at least $15 billion by 2020 towards environmentally sustainable solutions for our customers including initiatives that help lower carbon emissions, improve water stewardship and minimise waste1 $19.1 billion
Reduce the direct impact of our business activities on the environment by reducing scope 1 & 2 emissions by 24% by 2025 and 35% by 2030 (against a 2015 baseline) -25%
FINANCIAL WELLBEING Help enable social and economic participation of 1 million people by 20202 >998k
Increasing women in leadership to 33.1% by 2019 (34.1% by 2020)3 32.5%
Recruiting >1,000 people from under-represented groups by 2020 734
HOUSING Provide NZ$100 million of interest free loans to insulate homes for ANZ mortgage holders (New Zealand) NZ$6.3 million
Offer all ANZ first home buyers access to financial coaching support >3.3k coaches trained

For detailed performance information refer to the 2019 ESG Supplement available in December 2019 anz.com/cs.

Including renewable energy generation, green buildings and less emissions intensive manufacturing and transport 2. Through our initiatives to support financial wellbeing including financial inclusion, employment and community programs, and targeted banking products and services for small businesses and retail customers 3. FY18-FY20 target is defined as Women in Leadership which measures representation at the Senior Manager, Executive and Senior Executive levels

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116

ESG PERFORMANCE TRENDS

COMMUNITY INVESTMENT[1]

Total community investment ($m)

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142
131 137
90
75
2015 2016 2017 2018 2019
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MONEYMINDED & SAVER PLUS

Estimated # of people reached

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88,308 [90,724]
80,074
69,826
65,549
2015 2016 2017 2018 2019
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ENVIRONMENTAL FINANCING $15B TARGET

Funded and facilitated ($b)

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19.1
11.5
6.9
2.5
2016 2017 2018 2019
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EMPLOYEE ENGAGEMENT[2]

ENVIRONMENTAL FOOTPRINT TARGET

WOMEN IN LEADERSHIP[3]

Scope 1 & 2 greenhouse gas emissions (k tonnes CO2-e)

Employee engagement score (%)

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76 77 210
74 194
72 73 181
171
157
2015 2016 2017 2018 2019 2015 2016 2017 2018 2019
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Representation (%)

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32.5
32.0
31.1
29.9
29.5
2015 2016 2017 2018 2019
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Figure includes forgone revenue (2019 = $109m), being the cost of providing low or fee-free accounts to a range of customers such as government benefit recipients, not-for-profit organisations and students 2. The 2017 engagement survey was run as a pulse survey sent to 10% of the bank’s employees with a 57% response rate. For all other years the employee engagement survey was sent to all staff 3. Measures representation at the Senior Manager, Executive and Senior Executive Levels. Includes all employees regardless of leave status but not contractors (which are included in FTE)

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EXTERNAL REPORTING

RECOGNITION

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Second ranked Australian bank on the Dow Jones Sustainability Index, scoring 82/100 in 2019

FRAMEWORKS

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Our sustainability reporting is prepared in accordance with the Global Reporting Initiative Standards

(Comprehensive level)

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We achieved a CDP Member of the climate disclosure score FTSE4Good Index of A- in 2018

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We report in line with using the recommendations of the Financial Stability Board’s (FSB) Task Force on ClimateRelated Disclosures (TCFD)

We have been a signatory to the United Nations Global Compact since 2010

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2018-19 leader in workplace gender equality

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As an Equator Principles Financial Institution signatory we report on our

implementation of the Principles in our Sustainability Review

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Platinum Status LGBTI Employer of Choice for longevity in high performance (2015 to 2019)

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2019 FULL YEAR RESULTS —

CLIMATE-RELATED FINANCIAL DISCLOSURES

CLIMATE-RELATED FINANCIAL DISCLOSURES (TCFD)[1]

Governance	Strategy	Risk Management	Metrics & targets
• Board Risk Committee oversees management of climate-related risks • Board Ethics, Environment, Social and Governance Committee oversees and approves climate- related objectives, goals and targets • Ethics and Responsible Business Committee (executive management) oversees our approach to sustainability and reviews climate-related risks	• Low carbon financial products and services • Staff training on transition planning • Reducing our own operational footprint • Focus on a ‘just and orderly’ low carbon transition • UNEP FI2 TCFD group that issued recommendations on portfolio transition and physical risks • Analysis of flood-related risks for home loan portfolio in a major regional location of Australia • Flood-related analysis and test-pilot of socio-economic indicators for customer financial resilience	• Climate-related risks identified as potential credit risk • Climate change risk added to Group and Institutional Risk Appetite Statements • Climate change identified as a Principal Risk and Uncertainty in our UK Disclosure and Transparency Rules Submission • Guidelines and training provided to 1,000 of our Institutional bankers on customer transition plans • Enhanced analysis and credit terms applied to agricultural purchases in certain regions • New agribusiness customers assessed for climate resilience	• 29 engagements with large emitting customers to establish transition plans – targeting 100 customers by 2021 • $19.1 billion funded and facilitated in environmentally sustainable solutions • Declining exposure to the most carbon-intensive energy; thermal coal mining exposures halved since 2015 • 100% renewable electricity for our operations by 2025, with our emissions targets aligned with Paris Agreement goals

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A Financial Stability Board TaskForce released recommendations on financial disclosures in June 2017 to help investors better understand climate-related risks and opportunities. ANZ supports the TCFD recommendations and is using them to guide its disclosures 2 United Nations Environmental Programme for Financial Institutions

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SUPPORTING OUR CUSTOMERS AND TRAINING OUR STAFF ON THE DEVELOPMENT OF LOW CARBON TRANSITION PLANS

CUSTOMER MANAGEMENT AND STAFF TRAINING

CUSTOMER EXAMPLE: BHP’S TRANSITION PLANNING

ANZ customer management informed by climate-related engagement

We have identified carbon-intensive sectors most likely to be impacted by climate change
There are 100 of our largest emitting business customers in those sectors
We are supporting these customers to establish, or strengthen their low carbon transition plans
We will use the results of this engagement to inform our risk assessment of customers in these sectors

Training our staff to engage with customers on climate-risk

This year we provided training to over 1,000 bankers in our Institutional and Corporate businesses. The training covered:
how climate-related risks and opportunities might manifest for our customers
what elements we would expect to see in a robust transition plan
market and regulatory drivers that are focusing stakeholder attention on our customers
whether they have plans in place to manage their climaterelated risks and opportunities

BHP has an integrated strategy including:

Targets to hold net operational emissions at or below FY2017 levels by FY2022 while continuing to grow their business.
Active stewardship role working with customers, suppliers and other value chain participants to influence reductions in scope 3 including:
A commitment to spend US$400m to develop technology to reduce emissions.

HOW WE SUPPORT OUR CUSTOMERS – INCLUDING INCORPORATION OF CLIMATE-RISK MANAGEMENT

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2019 focus on ANZ staff managing specific higher carbon emitting customers

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FURTHER INFORMATION

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Our Shareholder information anz.com/shareholder/centre/

Equity Investors

Jill Campbell Cameron Davis Harsh Vardhan Group General Manager Executive Manager Manager Investor Relations Investor Relations Investor Relations +61 3 8654 7749 +61 3 8654 7716 +61 3 8655 0878 +61 412 047 448 +61 421 613 819 +61 466 848 027 [email protected] [email protected] [email protected]

Retail Investors

Debt Investors

Michelle Weerakoon Scott Gifford Mary Makridis Manager Shareholder Head of Debt Investor Associate Director Services & Events Relations Debt Investor Relations +61 3 8654 7682 +61 3 8655 5683 +61 3 8655 4318 +61 411 143 090 +61 434 076 876 [email protected] [email protected] [email protected]

DISCLAIMER & IMPORTANT NOTICE: 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 or current expectations with respect to ANZ’s business and operations, market conditions, results of operations 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.

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AI assistant

Australia and New Zealand Banking Group Ltd. — Annual Report 2019

10425_rns_2019-10-30_2bfe217b-af1c-4be3-ac54-efdad1338b08.pdf