SUNCORP GROUP LIMITED — Audit Report / Information 2016

Aug 3, 2016

ABN 66 145 290 124 Suncorp Group Limited Suncorp Bank APS 330 as at 30 June 2016 Release date: 4 August 2016

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APS 330 as at 30 June 2016

Suncorp Bank

Basis of preparation

This document has been prepared by Suncorp Bank to meet the disclosure obligations under the Australian Prudential Regulation Authority (APRA) Australian Prudential Standard (APS) 330 Public Disclosure .

Suncorp Bank is represented by Suncorp-Metway Limited (SML) and its subsidiaries. SML is an authorised deposit-taking institution (ADI) and a wholly owned subsidiary of Suncorp Group Limited. Suncorp Group is represented by Suncorp Group Limited and its subsidiaries.

Other than statutory information required by a regulator (including APRA), all financial information is measured in accordance with Australian Accounting Standards. All figures have been quoted in Australian dollars and have been rounded to the nearest million.

This document has not been audited nor reviewed in accordance with Australian Auditing Standards. It should be read in conjunction with Suncorp Group’s consolidated annual and interim financial reports which have been either audited or reviewed in accordance with Australian Auditing Standards.

Figures relate to the quarter ended 30 June 2016 (unless otherwise stated) and should be read in conjunction with other information concerning Suncorp Group filed with the Australian Securities Exchange (ASX).

Disclaimer

This report contains general information which is current as at 4 August 2016. It is information given in summary form and does not purport to be complete.

It is not a recommendation or advice in relation to the Suncorp Group and Suncorp Bank or any product or service offered by its entities. 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.

The information in this report is for general information only. To the extent that the information may constitute forward-looking statements, the information reflects Suncorp Group’s intent, belief or current expectations with respect to our business and operations, market conditions, results of operations and financial condition, capital adequacy, specific provisions and risk management practices at the date of this report. Such forward-looking statements are not guarantees of future performance and involve known and unknown risks and uncertainties, many of which are beyond Suncorp Group’s control, which may cause actual results to differ materially from those expressed or implied.

Suncorp Group and Suncorp Bank undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date of this report (subject to ASX disclosure requirements).

Registered Office

Level 28, 266 George Street, Brisbane Queensland 4000 Telephone: (07) 3362 1222 www.suncorpgroup.com.au

Investor Relations

Mark Ley Head of Investor Relations Telephone: (02) 8121 1221 mark.ley@suncorp.com.au

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Suncorp Bank

APS 330 as at 30 June 2016

Table of contents

Basis of preparation .................................................................................................................................................... 2 Regulatory capital reconciliation ............................................................................................................................... 4 Table 1: Capital disclosure template ......................................................................................................................... 6 Table 2: Main features of capital instruments ......................................................................................................... 10 Table 3: Capital adequacy......................................................................................................................................... 11 Table 4: Credit risk .................................................................................................................................................... 12 Table 5: Securitisation exposures ........................................................................................................................... 17 Table 18: Remuneration disclosures ....................................................................................................................... 18 Table 20: Liquidity coverage ratio disclosure ......................................................................................................... 19 Appendix – Definitions .............................................................................................................................................. 21

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APS 330 as at 30 June 2016

Suncorp Bank

REGULATORY CAPITAL RECONCILIATION

The following table discloses the consolidated balance sheet of SML and its subsidiaries (Suncorp Bank), as published in its audited financial statements, and the balance sheet under the Level 2 regulatory scope of consolidation pursuant to APS 111 Capital Adequacy: Measurement of Capital .

Each component of capital reported in Table 1: Capital Disclosure Template can be reconciled to the balance sheets below using the reference letters included in both tables.

	BALANCE SHEET PER PUBLISHED REVIEWED FINANCIAL STATEMENTS	ADJUSTMENTS	BALANCE SHEET UNDER REGULATORY SCOPE OF CONSOLIDATION	REFERENCE
	JUN-16 JUN-16 JUN-16
	$M $M $M
Assets	1,028 552	- 1,028 - 552
Cash and cash equivalents
Receivables due from other banks
Tradingsecurities	1,497 675 5,225 - 54,134	- 1,497 - 675 - 5,225 2 2 (2,308) 51,826
Derivatives
Investment securities
Investment in regulatorynon-consolidated subsidiaries				(j)
Loans, advances and other receivables
of which: eligible collective provision component of GRCL in tier 2 capital	- - -	- (82) - 201 - 10		(o)
of which: loan and lease origination fees and commissions paid to mortgage . originators and brokers in CET1 regulatory adjustments				(f)
of which: costs associated with debt raisings in CET1 regulatory adjustments				(g)
Due from subsidiaries	295 44	- 295 - 44
Deferred tax assets
of which: arising from temporary differences included in CET1 regulatory . adjustments	-	- 50		(e)
Other assets	145	(23) 122
of which: loan and lease origination fees and commissions paid to mortgage . originators and brokers in CET1 regulatory adjustments	-	- 2		(h)
Goodwill and intangible assets	21	- 21		(d)
Total assets Liabilities	63,616 (2,329) 61,287 (332) - (332) (45,421) (12) (45,433) (498) - (498) - (4) (4) (q) (481) 4 (477)
Payables due to other banks
Deposits and short-term borrowings
Derivatives
Securitisation derivatives in CET1 regulatoryadjustments
Payables and other liabilities
Due to regulatorynon-consolidated subsidiaries	-	(30) (30)
Securitisation liabilities	(2,544) 2,351 (193)
of which: securitisation start-up costs in CET1 regulatory adjustments	-	- 6		(i)
Debt issues	(9,860) - (9,860)
Total liabilities excluding loan capital Loan capital	(59,136) 2,309 (56,827) (742) - (742)
Subordinated notes
of which: directly issuedqualifying tier 2 instruments	-	- (670) (m)
of which: directly issued instruments subject to phase out from tier 2	-	- (72) (n)
Total loan capital	(742) - (742)
Total liabilities	(59,878) 2,309 (57,569)
Net assets	3,738	(20) 3,718
Equity	(2,648) - (2,648) (a) (450) - (450) (k) 270 - 270
Share capital
Capital notes
Reserves
of which: equity component of GRCL in tier 2 capital	- -	- (85) - (5)		(p)
of which: AFS reserve				(c)
Retainedprofits	(910) 20 (890)
of which: included in CET1	-	- (522) (b)
Total equity	(3,738) 20 (3,718)

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Suncorp Bank

APS 330 as at 30 June 2016

REGULATORY CAPITAL RECONCILIATION (continued)

The Level 2 group for regulatory capital purposes consists of the parent entity, SML, and its eligible subsidiaries.

There are no entities included in the regulatory scope of consolidation which are excluded from the accounting scope of consolidation.

The following legal entities are included in the accounting scope of consolidation but are excluded from the regulatory scope of consolidation:

	TOTAL ASSETS TOTAL LIABILITIES
	JUN-16 JUN-16 $ $
SPDEF #2 Pty Ltd	1 -
Principal activity:

The company acts as trustee for Suncorp Property Development Equity Fund #2 Unit Trust.

	JUN-16 JUN-16 $M $M
Suncorp Property Development Equity Fund #2 Unit Trust	19 (1)
Principal activity:

The Trust was established by the directors of SPDEF #2 Pty Ltd (the trustee) for the purpose of forming an unincorporated joint venture to develop land for the purpose of reselling as residential housing lots.

Securitisation special purpose vehicles1	JUN-16 JUN-16 $M $M
Apollo Series 2010-1 Trust Apollo Series 2011-1 Trust Apollo Series 2012-1 Trust Apollo Series 2013-1 Trust Apollo Series 2015-1 Trust	215 (215) 383 (383) 372 (372) 490 (490) 914 (914)
Principal activity:

The Trusts were established for the purpose of raising funds, via the issue of mortgage backed securities, to fund the purchase of mortgage loans by equitable assignment.

Note

1. The Trusts qualify for regulatory capital relief under APS 120 and are therefore deconsolidated from the Level 2 regulatory group. The assets of the Trusts include the secured loans from SML, representing the outstanding balance of securitised mortgages and accrued interest, as well as cash and other receivables.

Any transfer of funds or regulatory capital within the Level 2 group can occur only after the relevant approvals from management and the Board of each affected entity, in line with the Suncorp Group’s capital management policies. Any such transactions must be consistent with the Suncorp Group’s capital management strategy objectives to ensure each entity in the Level 2 group has sufficient capital resources to maintain the business and operational requirements, retain sufficient capital to exceed externally imposed capital requirements, and ensure Suncorp Bank’s ability to continue as a going concern.

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Suncorp Bank

TABLE 1: CAPITAL DISCLOSURE TEMPLATE

The disclosures below are presented using the post 1 January 2018 common disclosure template as, pursuant to APRA guidelines, SML and its eligible subsidiaries is applying, in full, the Basel III regulatory adjustments from 1 January 2013.

		JUN-16	SOURCE IN REGULATORY CAPITAL RECON- CILIATION
		$M
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25	Common Equity Tier 1 capital: instruments and reserves	2,648 (a) 522 (b) 5 (c) - -
	Directly issued qualifying ordinary shares (and equivalent for mutually-owned entities) capital
	Retained earnings
	Accumulated other comprehensive income (and other reserves)
	Directly issued capital subject to phase out from CET1 (only applicable to mutually- owned companies)
	Ordinary share capital issued by subsidiaries and held by third parties (amount allowed ingroupCET1)
	Common Equity Tier 1 capital before regulatory adjustments Common Equity Tier 1 capital: regulatory adjustments	3,175 - 21 (d) - - - - - - - - - - - - - - - - -
	Prudential valuation adjustments
	Goodwill (net of related tax liability)
	Other intangibles other than mortgage servicing rights (net of related tax liability)
	Deferred tax assets that rely on future profitability excluding those arising from temporarydifferences(net of related tax liability)
	Cash-flow hedge reserve
	Shortfall of provisions to expected losses
	Securitisation gain on sale (as set out in paragraph 562 of Basel II framework)
	Gains and losses due to changes in own credit risk on fair valued liabilities
	Defined benefit superannuation fund net assets
	Investments in own shares (if not already netted off paid-in capital on reported balance sheet)
	Reciprocal cross-holdings in common equity
	Investments in the capital of banking, financial and insurance entities that are outside the scope of regulatory consolidation, net of eligible short positions, where the ADI does not own more than 10% of the issued share capital (amount above 10% threshold)
	Significant investments in the ordinary shares of banking, financial and insurance entities that are outside the scope of regulatory consolidation, net of eligible short positions(amount above 10% threshold)
	Mortgage service rights (amount above 10% threshold)
	Deferred tax assets arising from temporary differences (amount above 10% threshold, net of related tax liability)
	Amount exceeding the 15% threshold
	of which: significant investments in the ordinary shares of financial entities
	of which: mortgage servicing rights
	of which: deferred tax assets arising from temporary differences

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Suncorp Bank

APS 330 as at 30 June 2016

TABLE 1: CAPITAL DISCLOSURE TEMPLATE (continued)

		JUN-16	SOURCE IN REGULATORY CAPITAL RECON- CILIATION
		$M
26 26a 26b 26c 26d 26e 26f 26g 26h 26i 26j 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 41a 41b 41c 42 43 44 45	National specific regulatory adjustments (sum of rows 26a, 26b, 26c, 26d, 26e, 26f, 26g,26h,26i and 26j)	274 - - - - 50 (e) 219 (f)+(g)+(h)+(i) - - - 5 (j)-(q) -
	of which: treasury shares
	of which: offset to dividends declared under a dividend reinvestment plan (DRP), to . the extent that the dividends are used to purchase new ordinary shares . issued by the ADI
	of which: deferred fee income
	of which: equity investments in financial institutions not reported in rows 18, 19 and 23
	of which: deferred tax assets not reported in rows 10, 21 and 25
	of which: capitalised expenses
	of which: investments in commercial (non-financial) entities that are deducted under . APRA requirements
	of which: covered bonds in excess of asset cover in pools
	of which: undercapitalisation of a non-consolidated subsidiary
	of which: other national specific regulatory adjustments not reported in rows 26a to 26i
	Regulatory adjustments applied to Common Equity Tier 1 due to insufficient Additional Tier 1 and Tier 2 to cover deductions
	Total regulatory adjustments to Common Equity Tier 1	295
	Common Equity Tier 1 Capital (CET1)	2,880
	Additional Tier 1 Capital: instruments	450 (k) 450 (k) - - (l) - -
	Directly issued qualifying Additional Tier 1 instruments
	of which: classified as equity under applicable accounting standards
	of which: classified as liabilities under applicable accounting standards
	Directly issued capital instruments subject to phase out from Additional Tier 1
	Additional Tier 1 instruments (and CET1 instruments not included in row 5) issued by subsidiaries and held bythirdparties(amount allowed ingroupAT1)
	of which: instruments issued by subsidiaries subject to phase out
	Additional Tier 1 Capital before regulatory adjustments Additional Tier 1 Capital: regulatory adjustments	450 - - - - - - - - -
	Investments in own Additional Tier 1 instruments
	Reciprocal cross-holdings in Additional Tier 1 instruments
	Investments in the capital of banking, financial and insurance entities that are outside the scope of regulatory consolidation, net of eligible short positions, where the ADI does not own more than 10% of the issued share capital(amount above 10% threshold)
	Significant investments in the capital of banking, financial and insurance entities that are outside the scope of regulatoryconsolidation(net of eligible shortpositions)
	National specific regulatory adjustments (sum of rows 41a, 41b and 41c)
	of which: holdings of capital instruments in group members by other group members . on behalf of thirdparties
	of which: investments in the capital of financial institutions that are outside the scope of . regulatory consolidations not reported in rows 39 and 40
	of which: other national specific regulatory adjustments not reported in rows 41a & 41b
	Regulatory adjustments applied to Additional Tier 1 due to insufficient Tier 2 to cover deductions
	Total regulatory adjustments to Additional Tier 1 capital	-
	Additional Tier 1 capital (AT1)	450
	Tier 1 Capital (T1=CET1+AT1)	3,330

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APS 330 as at 30 June 2016

Suncorp Bank

TABLE 1: CAPITAL DISCLOSURE TEMPLATE (continued)

		JUN-16	SOURCE IN REGULATORY CAPITAL RECON- CILIATION
		$M
46 47 48 49 50 51 52 53 54 55 56 56a 56b 56c 57 58 59 60 61 62 63 64 65 66	Tier 2 Capital: instruments and provisions
	Directly issued qualifying Tier 2 instruments
	Directly issued capital instruments subject to phase out from Tier 2
	Tier 2 Capital before regulatory adjustments 909 Tier 2 Capital: regulatory adjustments Investments in own Tier 2 instruments - Reciprocal cross-holdings in Tier 2 instruments - Investments in the Tier 2 capital of banking, financial and insurance entities that are outside the scope of regulatory consolidation, net of eligible short positions, where the ADI does not own more than 10% of the issued share capital (amount above 10% threshold) - Significant investments in the Tier 2 capital of banking, financial and insurance entities that are outside the scope of regulatory consolidation,net ofeligible short positions - National specific regulatory adjustments (sum of rows 56a, 56b and 56c) - of which: holdings of capital instruments in group members by other group members . on behalf of thirdparties - of which: investments in the capital of financial institutions that are outside the scope . of regulatory consolidation not reported in rows 54 and 55 - of which: other national specific regulatory adjustments not reported in rows 56a & 56b -
	Total regulatory adjustments to Tier 2 capital -
	Tier 2 capital (T2) 909
	Total capital (TC=T1+T2) 4,239
	Total risk-weighted assets based on APRA standards 31,459
	Capital ratios and buffers Common Equity Tier 1 (as a percentage of risk-weighted assets) 9.15% Tier 1 (as a percentage of risk-weighted assets) 10.58% Total capital (as a percentage of risk-weighted assets) 13.47% Buffer requirement (minimum CET1 requirement of 4.5% plus capital conservation buffer of 2.5% plus any countercyclical buffer requirements expressed as a percentage of risk-weighted assets) 7.00% of which: capital conservation buffer requirement 2.50% of which: ADI-specific countercyclical buffer requirements -
67	of which: G-SIB buffer requirement (not applicable)
68	Common Equity Tier 1 available to meet buffers (as a percentage of risk-weighted assets) 9.15% National minima (if different from Basel III)
69 70 71	National Common Equity Tier 1 minimum ratio (if different from Basel III minimum) n/a National Tier 1 minimum ratio (if different from Basel III minimum) n/a National total capital minimum ratio (if different from Basel III minimum) n/a
72 73 74 75	Amount below thresholds for deductions (not risk-weighted) Non-significant investments in the capital of other financial entities - Significant investments in the ordinary shares of financial entities - Mortgage servicing rights (net of related tax liability) - Deferred tax assets arising from temporary differences (net of related tax liability) 50
			(e)

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APS 330 as at 30 June 2016

TABLE 1: CAPITAL DISCLOSURE TEMPLATE (continued)

		JUN-16	SOURCE IN REGULATORY CAPITAL RECON- CILIATION
		$M
76 77 78 79 80 81 82 83 84 85	Applicable caps on the inclusion ofprovisions in Tier 2	167 350 n/a n/a - - - - 113 -
	Provisions eligible for inclusion in Tier 2 in respect of exposures subject to standardised approach(prior to application of cap)		(o)+(p)
	Cap on inclusion of provisions in Tier 2 under standardised approach
	Provisions eligible for inclusion in Tier 2 in respect of exposures subject to internal ratings-based approach(prior to application of cap)
	Cap for inclusion of provisions in Tier 2 under internal ratings-based approach Capital instruments subject to phase-out arrangements (only applicable between 1 Jan 2018 and 1 Jan 2022)
	Current cap on CET1 instruments subject to phase out arrangements
	Amount excluded from CET1 due to cap (excess over cap after redemptions and maturities)
	Current cap on AT1 instruments subject to phase out arrangements
	Amount excluded from AT1 instruments due to cap (excess over cap after redemptions and maturities)
	Current cap on T2 instruments subject to phase out arrangements
	Amount excluded from T2 due to cap (excess over cap after redemptions and maturities)

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APS 330 as at 30 June 2016

Suncorp Bank

TABLE 2: MAIN FEATURES OF CAPITAL INSTRUMENTS

Attachment B of APS 330 details the continuous disclosure requirements for the main features of all capital instruments included in Suncorp Bank’s regulatory capital.

The Suncorp Group’s main features of capital instruments are updated on an ongoing basis and are available at www.suncorpgroup.com.au/investors/regulatory-disclosures.

The full terms and conditions of all of Suncorp Group’s regulatory capital instruments are available at http://www.suncorpgroup.com.au/investors/securities[1] .

Note

1. The published full terms and conditions represent the comparable capital instruments issued by Suncorp Group Limited to external investors. The terms of these instruments may differ slightly to those instruments issued by the regulatory Level 2 group.

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APS 330 as at 30 June 2016

TABLE 3: CAPITAL ADEQUACY

	CARRYING VALUE	CARRYING VALUE	AVG RISK WEIGHT	RISK-WEIGHTED ASSETS	RISK-WEIGHTED ASSETS
	JUN-16 MAR-16 JUN-16 JUN-16 MAR-16 $M $M % $M $M
On-balance sheet credit risk-weighted assets Cash items Claims on Australian and foreign governments Claims on central banks, international banking agencies, regional development banks, ADIs and overseas banks Claims on securitisation exposures Claims secured against eligible residential mortgages Past due claims Other retail assets Corporate Other assets and claims	430 382 3 12 2 2,572 2,415 - - - 2,807 3,573 21 597 733 937 935 20 187 187 42,239 40,740 38 15,962 15,446 549 541 89 487 482 558 453 85 474 361 8,443 8,299 100 8,432 8,281 294 271 100 293 269
Total banking assets	58,829 57,609 45 26,444 25,761
	NOTIONAL AMOUNT	CREDIT EQUIVALENT	AVG RISK WEIGHT	RISK-WEIGHTED ASSETS
	JUN-16	JUN-16	JUN-16	JUN-16	MAR-16
	$M $M % $M $M
Off-balance sheet positions Guarantees entered into in the normal course of business Commitments to provide loans and advances Foreign exchange contracts Interest rate contracts Securitisation exposures CVA capital charge	251 249 66 165 166 8,201 2,261 54 1,220 1,139 6,424 114 38 43 48 58,651 94 43 40 43 2,050 31 84 26 31 - - - 62 77
Total off-balance sheet positions	75,577 2,749 57 1,556 1,504
Market risk capital charge Operational risk capital charge Total off-balance sheet positions Total on-balance sheet credit risk-weighted assets				108 152 3,351 3,304 1,556 1,504 26,444 25,761
Total assessed risk				31,459 30,721
Risk-weighted capital ratios				% %
Common Equity Tier 1 Tier 1 Tier 2				9.15 9.08 10.58 10.54 2.89 3.00
Total risk-weighted capital ratio				13.47 13.54

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Suncorp Bank

APS 330 as at 30 June 2016

TABLE 4: CREDIT RISK

Table 4A: Credit risk by gross credit exposure – outstanding as at 30 June 2016

	REC EIV AB LES D UE FROM OTHER B AN KS ( 2 ) TR AD IN G SECU RITIES INV ESTM ENT SEC UR ITIES LOAN S AN D AD V AN CES CR ED IT COM M ITM ENTS ( 3 ) D ERIV ATIV E IN STR UM ENTS ( 3 )	TOTA L C R EDIT RISK IM PA IRED ASSETS PA ST DU E N OT IM PA IR ED > 9 0 D AY S TOTAL N OT PA ST D UE OR IM PA IR ED SPEC IFIC PR OV ISIONS
Agribusiness Construction & development Financial services Hospitality Manufacturing Professional services Property investment Real estate - Mortgage Personal Government/public authorities Other commercial & industrial	$M $M $M $M $M $M	$M $M $M $M $M
	- - - 3,952 187 -	4,139 105 11 4,023 21
	- - - 528 125 -	653 8 2 643 5
	552 199 2,001 92 173 208	3,225 - - 3,225 -
	- - - 902 36 -	938 21 - 917 3
	- - - 278 20 -	298 1 - 297 1
	- - - 252 12 -	264 7 1 256 4
	- - - 1,953 93 -	2,046 14 3 2,029 4
	- - - 41,962 1,668 -	43,630 24 333 43,273 4
	- - - 376 6 -	382 8 11 363 5
	- 1,298 2,287 - - -	3,585 - - 3,585 -
	- - - 1,695 190 -	1,885 18 29 1,838 9
Total gross credit risk Securitisation exposures(1)	552 1,497 4,288 51,990 2,510 208	61,045 206 390 60,449 56
	- - 937 2,308 22 9	3,276 - 14 3,262 -
Total including Securitisation exposures Impairment provision TOTAL	552 1,497 5,225 54,298 2,532 217	64,321 206 404 63,711 56
		(164) (56) (26) (82)
		64,157 150 378 63,629

(1) The securitisation exposures of $2,308 million included under “Loans and advances” qualify for regulatory capital relief under APS 120 and therefore do not contribute to the Bank’s Total gross credit risk. The remaining securitisation exposures carry credit risk commensurate with their respective asset classes in accordance with APS 120.

(2) Receivables due from other banks include collateral deposits provided to derivative counterparties. (3)

“Credit commitments” and “Derivative instruments” represent the credit equivalent amount of the Bank’s off-balance sheet exposures calculated in accordance with APS 112.

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Suncorp Bank

APS 330 as at 30 June 2016

TABLE 4: CREDIT RISK (continued)

Table 4A: Credit risk by gross credit exposure – outstanding as at 31 March 2016

	R EC EIV A B LES D U E FR OM OTHER B A N KS ( 2 ) TR A D IN G SEC U R ITIES IN V ESTM EN T SEC U R ITIES LOA N S A N D A D V A N C ES ( 3 ) C R ED IT C OM M ITM EN TS ( 4 ) D ER IV A TIV E IN STR U M EN TS ( 4 )	TOTA L C R ED IT R ISK IM PA IR ED A SSETS PA ST D U E N OT IM PA IR ED > 9 0 D A Y S TOTA L N OT PA ST D U E OR IM PA IR ED SPEC IFIC PR OV ISION S
Agribusiness Construction & development Financial services Hospitality Manufacturing Professional services Property investment Real estate - Mortgage Personal Government/public authorities Other commercial & industrial	$M $M $M $M $M $M	$M $M $M $M $M
	- - - 3,860 184 -	4,044 113 14 3,917 23
	- - - 504 126 -	630 1 2 627 -
	537 289 2,386 484 200 241	4,137 - - 4,137 -
	- - - 836 50 -	886 10 2 874 1
	- - - 260 15 -	275 1 2 272 1
	- - - 224 10 -	234 7 1 226 4
	- - - 2,011 95 -	2,106 16 1 2,089 4
	- - - 40,345 1,555 -	41,900 15 338 41,547 4
	- - - 375 7 -	382 8 10 364 5
	- 1,053 2,469 - - -	3,522 - - 3,522 -
	- - - 1,655 129 -	1,784 19 29 1,736 12
Total gross credit risk Securitisation exposures(1)	537 1,342 4,855 50,554 2,371 241	59,900 190 399 59,311 54
	- - 935 2,700 26 11	3,672 - 17 3,655 -
Total including Securitisation exposures Impairment provision TOTAL	537 1,342 5,790 53,254 2,397 252	63,572 190 416 62,966 54
		(167) (54) (26) (87)
		63,405 136 390 62,879

(1) The securitisation exposures of $2,700 million included under “Loans and advances” qualify for regulatory capital relief under APS 120 and therefore do not contribute to the Bank’s Total gross credit risk. The remaining securitisation exposures carry credit risk commensurate with their respective asset classes in accordance with APS 120.

(2) Receivables due from other banks include collateral deposits provided to derivative counterparties.

(3) Total loans and advances include receivables due from related parties.

(4) “Credit commitments” and “Derivative instruments” represent the credit equivalent amount of the Bank’s off-balance sheet exposures calculated in accordance with APS 112.

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Suncorp Bank

APS 330 as at 30 June 2016

TABLE 4: CREDIT RISK (continued)

Table 4A: Credit risk by gross credit exposure – average gross exposure over period 1 April to 30 June 2016

	RECEIV A BLES DU E FR OM OTHER B AN KS ( 2 ) TRA DING SEC UR ITIES INV ESTM EN T SEC UR ITIES LOAN S A ND AD V A NC ES CR EDIT COM M ITM EN TS ( 3 ) DER IV ATIV E INSTR UM ENTS ( 3 )	TOTA L CR EDIT R ISK
Agribusiness Construction & development Financial services Hospitality Manufacturing Professional services Property investment Real estate - Mortgage Personal Government/public authorities Other commercial & industrial	$M $M $M $M $M $M	$M
	- - - 3,906 186 -	4,092
	- - - 516 126 -	642
	545 244 2,194 288 187 225	3,683
	- - - 869 43 -	912
	- - - 269 18 -	287
	- - - 238 11 -	249
	- - - 1,982 94 -	2,076
	- - - 41,154 1,612 -	42,766
	- - - 376 7 -	383
	- 1,176 2,378 - - -	3,554
	- - - 1,675 160 -	1,835
Total gross credit risk Securitisation exposures(1)	545 1,420 4,572 51,273 2,444 225	60,479
	- - 936 2,504 24 10	3,474
Total including Securitisation exposures Impairment provision TOTAL	545 1,420 5,508 53,777 2,468 235	63,953
		(166)
		63,787

(1) The securitisation exposures of $2,504 million included under “Loans and advances” qualify for regulatory capital relief under APS 120 and therefore do not contribute to the Bank’s Total gross credit risk. The remaining securitisation exposures carry credit risk commensurate with their respective asset classes in accordance with APS 120.

(2) Receivables due from other banks include collateral deposits provided to derivative counterparties. (3)

“Credit commitments” and “Derivative instruments” represent the credit equivalent amount of the Bank’s off-balance sheet exposures calculated in accordance with APS 112.

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Suncorp Bank

APS 330 as at 30 June 2016

TABLE 4: CREDIT RISK (continued)

Table 4A: Credit risk by gross credit exposure – average gross exposure over period 1 January to 31 March 2016

	REC EIV AB LES D UE FROM OTHER BA NKS ( 2 ) TR AD IN G SECU RITIES IN V ESTM ENT SECU RITIES LOA NS AN D AD V A NC ES ( 3 ) CR EDIT C OM M ITM EN TS ( 4 ) DER IV ATIV E INSTR UM ENTS ( 4 )	TOTA L CR EDIT R ISK
Agribusiness Construction & development Financial services Hospitality Manufacturing Professional services Property investment Real estate - Mortgage Personal Government/public authorities Other commercial & industrial	$M $M $M $M $M $M	$M
	- - - 3,844 193 -	4,037
	- - - 492 125 -	617
	501 219 2,347 430 216 260	3,973
	- - - 853 42 -	895
	- - - 262 16 -	278
	- - - 231 10 -	241
	- - - 1,994 92 -	2,086
	- - - 40,260 1,484 -	41,744
	- - - 360 8 -	368
	- 1,012 2,417 - - -	3,429
	- - - 1,677 128 -	1,805
Total gross credit risk Securitisation exposures(1)	501 1,231 4,764 50,403 2,314 260	59,473
	- - 892 2,786 27 11	3,716
Total including Securitisation exposures Impairment provision TOTAL	501 1,231 5,656 53,189 2,341 271	63,189
		(173)
		63,016

(1) The securitisation exposures of $2,786 million included under “Loans and advances” qualify for regulatory capital relief under APS 120 and therefore do not contribute to the Bank’s Total gross credit risk. The remaining securitisation exposures carry credit risk commensurate with their respective asset classes in accordance with APS 120.

(2) Receivables due from other banks include collateral deposits provided to derivative counterparties.

(3) Total loans and advances include receivables due from related parties.

(4) “Credit commitments” and “Derivative instruments” represent the credit equivalent amount of the Bank’s off-balance sheet exposures calculated in accordance with APS 112.

15

APS 330 as at 30 June 2016

Suncorp Bank

TABLE 4: CREDIT RISK (continued)

Table 4B: Credit risk by portfolio – 30 June 2016

	GROSS CREDIT RISK EXPOSURE AVERAGE GROSS EXPOSURE IMPAIRED ASSETS PAST DUE NOT IMPAIRED > 90 DAYS SPECIFIC PROVISIONS CHARGES FOR SPECIFIC PROVISIONS & WRITE OFFS
Claims secured against eligible residential mortgages(1) Other retail Financial services Government and public authorities Corporate and other claims	$M $M $M $M $M **$M **
	46,906 46,240 24 347 4 3
	382 383 8 11 5 2
	3,225 3,683 - - - -
	3,585 3,554 - - - -
	10,223 10,093 174 46 47 1
Total	64,321 63,953 206 404 56 6

(1) $3,276 million, $3,474 million and $14 million has been included in Gross Credit Risk Exposure, Average Gross Exposure and Past due not impaired > 90 days respectively to include the securitisation exposures.

Table 4B: Credit risk by portfolio – 31 March 2016

	GROSS CREDIT RISK EXPOSURE AVERAGE GROSS EXPOSURE IMPAIRED ASSETS PAST DUE NOT IMPAIRED > 90 DAYS SPECIFIC PROVISIONS CHARGES FOR SPECIFIC PROVISIONS & WRITE OFFS
Claims secured against eligible residential mortgages(1) Other retail Financial services Government and public authorities Corporate and other claims	$M $M $M $M $M **$M **
	45,572 45,460 15 355 4 2
	382 368 8 10 5 1
	4,137 3,973 - - - -
	3,522 3,429 - - - -
	9,959 9,959 167 51 45 7
Total	63,572 63,189 190 416 54 10

(1) $3,672 million, $3,716 million and $17 million has been included in Gross Credit Risk Exposure, Average Gross Exposure and Past due not impaired > 90 days respectively to include the securitisation exposures.

Table 4C: General reserves for credit losses

	JUN-16 MAR-16
Collective provision for impairment Ineligible collectiveprovisions on Past Due not Impaired	$M $M
	108 113
	(26) (26)
Eligible collective provisions Equityreserve for credit losses	82 87
	85 92
General reserve for credit losses	167 179

16

Suncorp Bank

APS 330 as at 30 June 2016

TABLE 5: SECURITISATION EXPOSURES

Table 5A: Summary of securitisation activity for the period

	EXPOSURES SECURITISED	EXPOSURES SECURITISED	RECOGNISED GAIN OR(LOSS) ON SALE	RECOGNISED GAIN OR(LOSS) ON SALE
	JUN-16 MAR-16 JUN-16 MAR-16 $M $M $M $M	MAR-16	JUN-16	MAR-16
Residential mortgages	- - - -
Total exposures securitised during theperiod	- - - -

Table 5B(i): Aggregate of on-balance sheet securitisation exposures by exposure type

	EXPOSURE EXPOSURE	EXPOSURE EXPOSURE
Exposure type	JUN-16 MAR-16 $M $M	MAR-16
Debt securities	937 935
Total on-balance sheet securitisation exposures	937 935

Table 5B(ii): Aggregate of off-balance sheet securitisation exposures by exposure type

	EXPOSURE EXPOSURE
Exposure type	JUN-16 MAR-16 $M $M
Liquidity facilities(1) Derivative exposures(1)	22 26 9 11
Total off-balance sheet securitisation exposures	31 37

(1) For comparative purposes, March exposures are shown on a credit equivalent amount basis (previously reported on a notional basis).

17

APS 330 as at 30 June 2016

Suncorp Bank

TABLE 18: REMUNERATION DISCLOSURES

Table 18: Remuneration disclosures for the year ended 30 June 2016 will be included with the Group’s prudential disclosures for the quarter ended 30 September 2016, in accordance with the requirements of APS 330.

18

Suncorp Bank

APS 330 as at 30 June 2016

TABLE 20: LIQUIDITY COVERAGE RATIO DISCLOSURE

		TOTAL UNWEIGHTED VALUE (AVERAGE)	TOTAL WEIGHTED VALUE (AVERAGE)
		JUN-16 JUN-16
		$M $M
	Liquid assets, of which:
1 2 3	High-quality liquid assets (HQLA)	3,983 3,729 -
	Alternative liquid assets (ALA)
	Reserve Bank of New Zealand (RBNZ) securities
4 5 6 7 8 9 10	Cash outflows	18,271 1,520 13,870 693 4,401 827 4,771 3,222 - - 3,891 2,342 880 880
	Retail deposits and deposits from small business customers, of which:
	stable deposits
	less stable deposits
	Unsecured wholesale funding, of which:
	operational deposits (all counterparties) and deposits in networks for cooperative
	~~b~~ ~~k~~ non-operational deposits (all counterparties)
	unsecured debt
11	Secured wholesale funding	15
12 13 14 15 16 17	Additional requirements, of which	3,503 1,876 1,642 1,642 133 133 1,728 101 1,343 1,013 8,442 669
	outflows related to derivatives exposures and other collateral requirements
	outflows related to loss of funding on debt products
	credit and liquidity facilities
	Other contractual funding obligations
	Other contingent funding obligations
18	Total cash outflows	8,315
19 20 21 22	Cash inflows	(109) - 1,313 982 1,385 1,386
	Secured lending (e.g. reverse repos)
	Inflows from fully performing exposures
	Other cash inflows
	Total cash inflows	2,589 2,368
			TOTAL ADJUSTED VALUE
23 24 25	Total liquid assets	7,712
	Total net cash outflows	5,947
	Liquidity Coverage Ratio (%)	130

The Liquidity Coverage Ratio (LCR) requires sufficient qualifying HQLA to be maintained to meet expected net cash outflows under an APRA-prescribed 30 calendar day stress scenario.

SML holds a diverse portfolio of liquid assets, comprising HQLA (physical cash, Commonwealth Government Securities and Semi-government Securities) as well as other securities including senior unsecured bank debt, covered bonds and Residential Mortgage Backed Securities (RMBS) which are repo eligible with the Reserve Bank of Australia (RBA).

SML has a tiered management limit structure for the LCR to ensure that there is always an adequate buffer to the APRA Prudential Limit of 100% and calculates the LCR position against these limits on a daily basis. The amount of liquid assets held considers the amount needed to meet prudential and internal requirements (including a variety of internal stress scenarios as part of the risk management framework) and a suitable buffer reflecting management’s preference.

APRA has allowed locally-incorporated ADI’s to establish a Committed Liquidity Facility (CLF) with the RBA. SML received approval from APRA for a CLF of $4.2 billion for the 2016 calendar year ($4.8 billion for the 2015 calendar year). The $3.7 billion disclosed as ‘Alternative liquid assets’ reflects the required ‘open-repo’ of internal self-securitised RMBS with the RBA, which is considered a utilisation of the CLF and increases the HQLA.

19

APS 330 as at 30 June 2016

Suncorp Bank

The net cash outflow is sought to be minimised by targeting funding with lower LCR runoff rates and managing the maturity profile of wholesale liabilities.

SML has been compliant with the LCR prudential requirements at all times since it was introduced in January 2015. The daily average LCR for the quarter ended 30 June 2016 was 130% (in line with daily average LCR for the quarter ended 31 March 2016 of 130%).

An increase in daily average cash outflows over the quarter was largely offset by an increase in daily average cash inflows. The changes are largely explained by an increase in lending growth over the quarter (reflected in an increase in contractual funding obligations, credit and liquidity facilities and inflows from performing exposures) and a normalisation of offshore short term wholesale maturities in the LCR window (reflected in an increase in outflows related to derivative exposures and offset by a corresponding increase in ‘other cash inflows’).

20

Suncorp Bank

APS 330 as at 30 June 2016

Appendix – Definitions

Capital adequacy ratio	Capital base divided by total assessed risk, as defined by APRA
Common Equity Tier 1	Common Equity Tier 1 Capital (CET1) comprises accounting equity
	plus adjustments for intangible assets and regulatory reserves
Common Equity Tier 1 ratio	Common Equity Tier 1 divided by risk weighted assets, as defined by
	APRA
Credit Value Adjustment	A capital charge that covers the risk of mark-to-market losses on the
(CVA)	counterparty credit risk
Equity reserve for credit	The equity reserve for credit losses represents the difference between
losses (ERCL)	the collective provision for impairment and the estimate of credit
	losses across the credit cycle based on guidance provided by APRA
General Reserve Credit	The general reserve for credit losses is a reserve that covers credit
Loss (GRCL)	losses prudently estimated but not certain to arise over the full life of
	all the individual facilities based on guidance provided by APRA
Liquidity Coverage Ratio	Liquid assets divided by the forecast net cash outflows during a 30-
(LCR)	day similated severe stressed liquidity scenario
Past due loans	Loans outstanding for more than 90 days
Risk weighted assets (RWA)	Total of the carrying value of each asset class multiplied by their
	assigned risk weighting, as defined by APRA
Total assessed risk	Credit risk-weighted assets, off-balance sheet positions, market risk
	capital charge and operational risk charge, as defined by APRA

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