SUNCORP GROUP LIMITED — Interim / Quarterly Report 2016

Feb 10, 2016

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Financial results for the half year ended 31 December 2015

“Creating value for our customers”

Suncorp Group Data Pack 11 February 2016

Suncorp Group

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Leading financial services brands in Australia and New Zealand

Top 20 ASX listed company

$14 billion market capitalisation at 11 February 2016

$94 billion in group assets

13,400 employees in Australia and New Zealand

9 million customers

End to end ownership of brands

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Suncorp Group Data Pack 11 February 2016

Suncorp’s shareholder promise Simplified, de-risked financial services group

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Yield

Growth

• Dividend payout ratio of 60% to 80%

• Return of surplus capital

• Strategy focused exclusively in Australia and New Zealand

• De-risked and simplified business model

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• Efficiency-led profit growth

• Multi-brand, multi-channel approach providing greater value to the Group’s 9 million customers

• ‘Above system’ growth in key markets

• Incremental market opportunities such as SA CTP

Suncorp Group Data Pack

11 February 2016

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Dividends

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30 cent interim dividend, cash earnings payout ratio of 69%

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105
88
30
75
12
55 20
38
40
15
35 35
30
20
20 20
35 38
30
25
20
15 15
FY10 FY11 FY12 FY13 FY14 FY15 FY16
Interim Final Special
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Suncorp Group Data Pack

11 February 2016

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Suncorp Group capital initiatives Quantum of special dividend and impact of neutralisation of DRP ($m)

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$1.4b of capital management
516
357
275 386
238
257
193
154
69
51
39 38
43 49 61 46
FY12 FY13 FY14 FY15
Interim DRP Final ordinary DRP Special
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Suncorp Group Data Pack 11 February 2016

Suncorp Group business line NPAT ($m) Diversification of earnings

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681
597 544
397
619 41 52 58
69 105
61 176
144 194
156
470 419
564
162
297
34
64 -
10
-54 -140 -19 -5
1H12 1H13 1H14 1H15 1H16
■ Life underlying NPAT ■ Bank
■ Life market adjustments ■ Non-core Bank
Suncorp Group Data Pack ■ General Insurance
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Suncorp Group Data Pack

11 February 2016

6

Shareholder metrics

EPS (Basic)

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$0.49
$0.45
$0.43
$0.41
1H13 1H14 1H15 1H16
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EPS (Diluted)

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$0.48
$0.43
$0.42
$0.41
1H13 1H14 1H15 1H16
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1H13 1H14 1H15 1H16

Numerator ($m)

Earnings (EPS Basic) 574 548 631 530 Interest expense on CPS 22 14 22 21 (net of tax) Earnings (EPS Diluted) 596 562 653 551

Denominator (m)

Weighted Average Ordinary 1,278 1,278 1,279 1,279 Shares (EPS Basic) Effect of conversion of CPS 97 45 69 80 Weighted Average Ordinary 1,374 1,323 1,348 1,358 Shares (EPS Diluted)

Suncorp Group Data Pack

11 February 2016

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Shareholder metrics

Cash EPS (Basic)

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$0.52
$0.48
$0.46
$0.43
1H13 1H14 1H15 1H16
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Cash EPS (Diluted)

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$0.51
$0.46
$0.45
$0.42
1H13 1H14 1H15 1H16
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1H13 1H14 1H15 1H16

Numerator ($m)

Earnings (EPS Basic) Interest expense on CPS (net of tax) Earnings (EPS Diluted)	616 587 660 556 22 14 22 21
	638 601 682 577

Denominator (m)

Weighted Average Ordinary 1,278 1,278 1,279 1,279 Shares (EPS Basic) Effect of conversion of CPS 97 45 69 80 Weighted Average Ordinary 1,374 1,323 1,348 1,358 Shares (EPS Diluted)

Suncorp Group Data Pack

11 February 2016

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Shareholder metrics

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ROE
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9.4%
8.1%
7.9% 7.9%
1H13 1H14 1H15 1H16
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Cash ROE
9.8%
8.7%
8.4% 8.3%
1H13 1H14 1H15 1H16
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1H13 1H14 1H15 1H16

ROE Earnings ($m) 574 548 631 530 Average shareholders’ equity (m) 14,128 13,822 13,361 13,261

Cash ROE

Cash Earnings ($m) 616 587 660 556 Average shareholders’ equity (m) 14,128 13,822 13,361 13,261

Suncorp Group Data Pack

11 February 2016

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Top-line growth ($m)

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Growth remains solid across all business lines

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Short Tail GWP 1.7%
3,472
3,442
3,413
3,346
1H13 1H14 1H15 1H16
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Bank lending
5.1%
52,852
50,300
49,185 49,184
1H13 1H14 1H15 1H16
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Long Tail GWP

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0.1%
938 944 945
879
1H13 1H14 1H15 1H16
Life individual in-force policies
5.2%
795 881 957 1,007
1H13 1H14 1H15 1H16
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Suncorp Group Data Pack

11 February 2016

10

Suncorp’s strategic assets

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Our focus

• Deliver scale cost benefits on third party procured goods / services

Cost

• Maintain a stable operating expense base as a result of leveraging the Group’s scale, buying power and supplier relationships

• Creating value for our customers

Customer

• Broadening the connection with the Group’s nine million customers by deepening their relationships with the Group’s brands

Capital

• Demonstrating a diversification benefit through Group Risk Based Capital modelling

• A+/A1 credit rating

Culture

• Operating as ‘One Company. Many Brands. One Team’

Suncorp Group Data Pack

11 February 2016

Cost - operating expenses ($m)

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Stable over time

899 877 305 319 150 153 1,354 1,349	899 877 305 319 150 153 1,354 1,349		902 881 322 324 142 139 1,366 1,344	902 881 322 324 142 139 1,366 1,344	892 326 142 1,360
1H14	2H14		1H15	2H15	1H16
	General Insurance		Bank	Life

Suncorp Group Data Pack 11 February 2016

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CET1 Capital Base – HY16 movements ($m) Impacted by lower GI margins

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530 153 53 47 71 22 386 570 506 Excess CET1 HY16 NPAT GI excess Bank Project Bank ERCL Life impact from Growth and Dividend Excess CET1 FY15 technical Ignite release lower yields other HY16 provisions movements

Suncorp Group Data Pack 11 February 2016

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Capital

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Increased sophistication due to Risk Based Capital modelling

• Simplification and de-risking have supported capital returns

• Balance sheet strong

• Risk Based Capital embedded

• Enhancing decision making

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Group Diversification
Surplus Potential
NOHC
Life
Group
Group
Bank Total
Total
GI
Regulatory minimum Operating target Surplus to operating target
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Suncorp Group Data Pack

11 February 2016

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*Chart not to scale

Capital instruments

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Outstanding at 31 December 2015

	Semi-annual coupon rate / margin above 90 day BBSW	Optional Call / Exchange Date	Issue Date	31 DECEMBER 2015	31 DECEMBER 2015	31 DECEMBER 2015	31 DECEMBER 2015	Total Balance	Regulatory Capital
				GI	Bank	Life	SGL
				$M	$M	$M	$M	$M	$M
AAIL Subordinated Debt	330 bps	Nov 2020	Nov 2015	225	-	-	-	225	225
AAIL Subordinated Debt	6.75%	Oct 2016	Oct 2006	101	-	-	-	101	108
AAIL Subordinated Debt	-	June 2017	Oct 2007	265	-	-	-	265	220
SGL Subordinated Debt	285 bps	Nov 2018	May 2013	-	670	100	-	770	770
SML FRCN	75 bps	Perpetual	Dec 1998	-	72	-	-	72	72
Total subordinated debt				591	742	100	-	1,433	1,395
SGL CPS2	465 bps	Dec 2017	Nov 2012	110	450	-	-	560	560
SGL CPS3	340 bps	June 2020	May 2014	400	-	-	-	400	400
Total Additional Tier 1 Capital				510	450	-	-	960	960
Total				1,101	1,192	100	-	2,393	2,355

Suncorp Group Data Pack

11 February 2016

15

• Additional information is available in appendix 3 of the Analyst Pack

Group Risk Based Capital Capital volatility by key risk type

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Suncorp Group
3%
24%
62%
11%
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Insurance risk

Operational risk Market risk

Counterparty credit risk

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GI Bank
3%
8%
21%
27%
3%
65%
73%
7% Life Corporate
14%
36%
57% 86%
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Suncorp Group Data Pack 11 February 2016

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Culture

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World leading employee engagement and enablement

91% of Suncorp people participated in the latest survey

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2013 2014 2015
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• Engagement and Enablement are at or above Global High Performance Norms

• 37% of women in senior leadership

• Improved employee advocacy with 85% of employees indicating they recommend Suncorp to family and friends

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77
76
73
72 72
70
Engagement Enablement
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Suncorp Group Data Pack 11 February 2016

Suncorp’s shareholder overview

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Shareholders by type

Shareholders by geography

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36% 36%
28%
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<1%
1% [1% ]
4%
3%
6%
36%
12%
36%
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■ International ■ Domestic institutions institutions ■ Retail

Suncorp Group Data Pack

■ Australian institutional ■ Japan ■ Australian retail ■ Singapore ■ United States ■ Rest of Europe ■ United Kingdom ■ Rest of world ■ Hong Kong

11 February 2016

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Optimisation On track to deliver $170m of benefits in FY18

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(100) (50) 0 50 100 150 200
		$170m OPTIMISATION PROGRAMS: • Suncorp Insurance Ventures • Claims transformation • Super Simplification • Technology & Procurement • Business Intelligence
		Optimisation Costs Optimisation Benefits Net Benefit FY15 FY16 FY17 FY18*

Suncorp Group Data Pack

11 February 2016

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Suncorp projects key milestones

On track and delivering

Program	Initiative	1H16	2H16
Optimisation	Motor claims repathing	Implementation of the national claims assessing model, including rollout of Audatex RepairLink rationalisation 3 new SMART repair centres	 RepairLink rationalisation  1 new SMART site  4 SMARTPlus sites
	Super Simplification	Business Process Outsourcing (BPO) and Information Technology Outsourcing (ITO) completed Detailed planning/project delivery phase commenced for product simplification and re-platforming	 New platform in and operational  First new product released to market  Progress on both product upgrade paths and migration to new platform
	Technology & Procurement	55% of total systems and applications migrated to cloud environments 5% of systems decommissioned	 65% of total systems and applications migrated to cloud environments  10% of systems decommissioned
	Business Intelligence	7 out of 13 legacy warehouses decommissioned Core Group Data on Suncorp Data Services (SDS)	 9 out of 13 legacy warehouses decommissioned
Ignite	Bank Platform	End to end lending application, supporting both origination and servicing of home loans Collateral system Data migration	 Ignite rollout to branch network  Deposit and Transactions accounts  Integration of Ignite with broker management systems  Merchant management system  Data migration
Simplification	GI LSP	71% GWP (10.4 million policies) on strategic platform 54% Legacy platform decommissioning complete (7 of 13 systems) 100% GIO CI SME new business transacted on strategic platform NZ AA Insurance (Policy and Claims) GIO Workers Compensation – Direct channels New NZ Corporate Partner (PI) launched	 Workers’ Compensation launched via new broker platform – Vero Edge  100% Workers’ Compensation underwritten new business transacted on strategic platform
Other	Real Estate	Reduce Brisbane real estate footprint Sydney consolidation: approval of concept design	 Reduce Sydney real estate footprint

Suncorp Group Data Pack

11 February 2016

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General Insurance

“Creating value for our customers”

Gross Written Premium

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By product

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Australia New Zealand Total
$7.6b $1.2b
$8.8b
<1%
4%
1%
15%
23% 12%
32%
34%
22% 43% 27%
30%
28%
29%
■ Home ■ Other
■ Motor ■ CTP
■ Commercial
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Suncorp Group Data Pack

11 February 2016

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Gross Written Premium

Total GWP of $8.8 billion Geography

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25%
3%
14%
28%
2%
3% 6%
19%
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■ New South Wales ■ ■ Queensland ■ Tasmania ■ Victoria ■ New Zealand ■ South Australia ■ Other

• Western Australia

Suncorp Group Data Pack

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Product

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<1%
15%
34%
22%
29%
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• Home

• ■ Motor ■ Commercial ■ CTP ■ Other

11 February 2016

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Underlying and Reported ITR

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Impacted by claims inflation and lower investment yields

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Underlying ITR
18.6%
Reported ITR 17.0%
14.8% 14.6%
13.1% [13.4% 13.6% 14.0% ]
12.8%
14.7%
10.5% 13.9% 10.1%
12%
10.0% 12.8%
11.2% 11.1%
8.0%
10.9% 11.1% 9.9%
9.4%
7.8%
6.4%
3.8%
1.9%
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1H10 2H10 1H11 2H11 1H12 2H12 1H13 2H13 1H14 2H14 1H15 2H15 1H16

Suncorp Group Data Pack 11 February 2016

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General Insurance

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Key ratios

Acquisition expenses ratio

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14.3% 14.4% 14.4%
14.0%
13.5%
1H14 2H14 1H15 2H15 1H16
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Loss ratio

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71.1% 71.0% 70.7%
68.2%
67.5%
1H14 2H14 1H15 2H15 1H16
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Other underwriting expenses ratio

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9.8%
8.7%
8.6%
8.1% 8.0%
1H14 2H14 1H15 2H15 1H16
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Total operating expense ratio

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23.3%
22.9%
22.7%
22.5%
22.4%
1H14 2H14 1H15 2H15 1H16
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Suncorp Group Data Pack

11 February 2016

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Reserve releases

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Conservative assumptions and world leading long-tail claims management

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5.4% 5.4%
3.4%
1.5% 1.7%
1.4%
1.4%
1.1%
1H13 2H13 1H14 2H14 1H15 2H15 1H16
Suncorp Group Data Pack
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11 February 2016

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Reserve releases

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Continued releases

Building Blocks Simplification delivered one reduced legal claims system costs

Management have reduced settlements and duration

Benign wage and superimposed inflation

Optimised claims processes

Reserve releases well above 1.5% of NEP

Suncorp Group Data Pack 11 February 2016

27

General Insurance – Natural hazards

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Six months to 31 December 2015

Date	Event	Net costs($m)
Aug2015	South Coast NSW and SydneyStorms	29
Sep2015	NSW Central Coast Hail	21
Oct 2015	Fernvale Chinchilla Hail	44
Nov 2015	Sunnybank Hail	16
Nov 2015	PineryBushfire	15
Nov 2015	DarlingDowns Storms	25
Dec 2015	Kurnell Tornado	63
Dec 2015	Great Ocean Road Bushfire	31
	Other natural hazards attritional claims(Australia)	114
	Other natural hazards attritional claims(New Zealand)	4
Total		362
	Less: allowance for natural hazards	(334)
	Natural hazards costs above allowance	28

Suncorp Group Data Pack

11 February 2016

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General Insurance – Natural hazards

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45 years of natural hazards*

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Christchurch earthquakes,
6,000 NZ AUS Long run average Brisbane floods, Cyclone
Yasi, Melbourne
Hailstorm
5,000 Cyclone
Marcia and
Hunter Valley NSW Low
storm Storms
4,000
Brisbane flood,
Newcastle Melbourne &
Cyclone Tracy
3,000 earthquake Perth Hailstorms,
Christchurch
earthquakes
Sydney
Retention Hailstorm
2,000 Brisbane Brisbane
Hailstorm Hailstorm
1,000
-
1967 1969 1971 1973 1975 1977 1979 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015
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Suncorp Group Data Pack

11 February 2016

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• Adjusted for inflation, population growth and market share

General Insurance – FY16 reinsurance program Conservative balance sheet protection against catastrophes

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6.9b
6.1b
2.5b
500m
250m	Original cover		Reinstatement			Reinstatement		Reinstatement
200m			Dropdown aggregate			Dropdown aggregate
50m
		Retention

Suncorp Group Data Pack

11 February 2016

30

General Insurance – FY16 reinsurance program Drop-down aggregate program fully placed

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250m		50m xs 200m xs 50m	100m xs 150m xs 200m	100m xs 150m xs 300m
200m
150m			100m xs 50m xs 200m	100m xs 50m xs 300m
50m		Retention

Suncorp Group Data Pack 11 February 2016

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General Insurance – Asset allocation Conservative setting for Insurance Funds Insurance Funds

Shareholders' Funds

$9.18b

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$2.99b
11% 8% <1% <1%
1% 3% 3% 5% 4% 6%
1% 1% 20% 14% 9% 22% 17% 16% 16% 15%
17% 2%
18%
24% 1% 4% 6% 4%
24%
18% 26%
17%
81%
77% 75% 74% 75%
64%
53% 56% 52% 59%
1H14 2H14 1H15 2H15 1H16 1H14 2H14 1H15 2H15 1H16
Commonwealth Government Bonds Cash and short-term deposits
Semi-Government Bonds Inflation-linked bonds Interest-bearing securities Cash and short-term deposits
Corporate Bonds Equities Infrastructure
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Commonwealth Government Bonds Cash and short-term deposits Semi-Government Bonds Inflation-linked bonds Corporate Bonds

Suncorp Group Data Pack

11 February 2016

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General Insurance – Asset credit quality

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Fixed income holdings in Insurance and Shareholders’ Funds

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2.5% 3.1% 4.3% 5.3% 7.8%
19.1% 18.2%
23.1%
25.6%
28.1%
30.4% 29.1%
32.9%
29.8%
25.0%
48.0% 49.6%
39.7% 39.3% 39.1%
1H14 2H14 1H15 2H15 1H16
AAA AA A BBB
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Suncorp Group Data Pack

11 February 2016

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General Insurance capital

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General Insurance capital levels

Prescribed Capital Amount

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3,860 1.73x PCA
553
510
CET1 Target range
(0.95-1.15x PCA)
2,797
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2,235

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e 286
719
250
532
891
(443)
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1H16

1H16

■ Common equity tier 1 ■ Additional tier 1 capital ■ Tier 2 capital

■ Outstanding claims risk ■ Insurance concentration risk ■ Premium liabilities risk ■ Operational risk ■ Aggregation risk ■ Asset benefit

Suncorp Group Data Pack

11 February 2016

34

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Personal Insurance

“Creating value for our customers”

Personal Insurance

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P&L

	HY16	HY15	%∆
GWP Net earned premium	2,383 2,144	2,369 2,171	0.6 (1.2)
Net incurred claims	(1,610)	(1,545)	4.2
Acquisition expenses	(243)	(243)	-
Other underwriting expenses	(153)	(172)	(11.0)
Total operating expenses	(396)	(415)	(4.6)
Underwriting result	138	211	(34.6)
Investment income – insurance funds	11	14	(21.4)
Insurance trading result	149	225	(33.8)

Key highlights

• 0.6% GWP growth in a highly competitive market

• Result impacted by increases in large loss fire and water claims

• Reduction in operating expenses due to continued focus

Suncorp Group Data Pack 11 February 2016

36

Personal Insurance

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$4.8 billion of GWP

Geography

• 2% 2%

• 6%[4% ] 27%

• 27% 32%

• ■ New South Wales ■ Western Australia ■ Queensland ■ Tasmania ■ Victoria ■ Other ■ South Australia

Product

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45%
55%
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■ Home ■ Motor

Suncorp Group Data Pack

11 February 2016

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Personal Insurance

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Key ratios

Acquisition expenses ratio

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11.7%
11.3%
11.2%
11.2% 11.2%
1H14 2H14 1H15 2H15 1H16
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Loss ratio

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81.2%
75.1%
71.2%
69.0%
64.8%
1H14 2H14 1H15 2H15 1H16
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Other underwriting expenses ratio

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8.9%
7.9% 7.9%
7.4%
7.1%
1H14 2H14 1H15 2H15 1H16
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Total operating expense ratio

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20.1%
19.6%
19.1%
18.6%
18.4%
1H14 2H14 1H15 2H15 1H16
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Suncorp Group Data Pack

11 February 2016

38

Personal Insurance

Market share* %

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16 37 34
6
14 17
15 15
28 31
36
30
31 33
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■ Home ■ Motor

Suncorp Group Data Pack

11 February 2016

Source: Roy Morgan *as at 30 November 2015

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39

Personal Insurance

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Market share*

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Home and Motor
Home Motor $15.6b
$7.6b $8.0b
24%
25% 24% 28%
27%
30%
3% 4% 4%
2% 2% 2%
2%
7% 5%
7%
6% 6%
30%
31%
31%
■ Suncorp ■ Peer 3
■ Peer 1 ■ Peer 4
■ Peer 2 ■ Peer 5
■ Other
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Suncorp Group Data Pack

11 February 2016 Source: Roy Morgan *as at 30 June 2015

40

Personal Insurance

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New business by channel

Distribution channels

Suncorp Group Data Pack

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

10%
90%
■ Direct
■ Intermediaries
----- End of picture text -----

11 February 2016

41

==> picture [98 x 30] intentionally omitted <==

==> picture [142 x 43] intentionally omitted <==

Commercial Insurance

“Creating value for our customers”

Commercial Insurance

==> picture [98 x 30] intentionally omitted <==

P&L

	HY16	HY15	%∆
GWP	1,413	1,383	2.2
Net earned premium	1,336	1,297	3.0
Net incurred claims	(936)	(1,019)	(8.1)
Acquisition expenses	(211)	(206)	2.4
Other underwriting expenses	(117)	(121)	(3.3)
Total operating expenses	(328)	(327)	0.3
Underwriting result	72	(49)	n/a
Investment income – insurance funds	82	239	(65.7)
Insurance trading result	154	190	(18.9)

Key highlights

• 2.2% GWP growth due to continued focus on value for customers

• Long-tail reserve releases of $206m

• Impact from very low yield investments

Suncorp Group Data Pack 11 February 2016

43

Commercial Insurance

==> picture [98 x 30] intentionally omitted <==

$2.9 billion total GWP

==> picture [639 x 240] intentionally omitted <==

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

Geographical Statutory GWP Non-statutory GWP
$1.1b $1.8b
10%
2%
10%
2% 30%
33% 4%
7% 41%
44%
11%
42%
29%
35%
New South Wales ■ Western Australia ■ NSW CTP ■ Corporate
----- End of picture text -----

• Corporate

• New South Wales ■ Western Australia

• ■ Queensland ■ Tasmania ■ Victoria ■ Other ■ South Australia

• (including global customers)

• ■ Commercial (SME and mid-market) ■ Specialty (including professional services, construction, motor dealers and marine)

• Qld CTP

• ACT CTP

• ■ Workers Compensation

Suncorp Group Data Pack

11 February 2016

Source: Suncorp *as at 31 December 2015

44

Commercial Insurance

==> picture [98 x 30] intentionally omitted <==

Market share - total

==> picture [680 x 290] intentionally omitted <==

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

Non- statutory Total
Statutory
$12.9b $5.4b $18.3b
10%
12% 17%
4% 25%
28%
31%
17%
19%
17%
7%
8%
17%
21% 13%
11%
22% 21%
■ Suncorp ■ Peer 3
■ Peer 1 ■ Peer 4
■ Peer 2 ■ Other
----- End of picture text -----*

Suncorp Group Data Pack

11 February 2016 Source: Suncorp estimates *as at 30 June 2015

45

Commercial Insurance

==> picture [98 x 30] intentionally omitted <==

Market share - Statutory

==> picture [568 x 293] intentionally omitted <==

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

CTP Workers Compensation
$3.7b $1.7b
4% [6% ] 18% 18%
33%
6%
20%
21%
15%
22% 15%
22%
■ Suncorp ■ Peer 3
■ Peer 1 ■ Peer 4
■ Peer 2 ■ Other
----- End of picture text -----

Suncorp Group Data Pack

11 February 2016

Source: Suncorp estimates *as at 30 June 2015

46

Commercial Insurance

==> picture [98 x 30] intentionally omitted <==

Market share - CTP

==> picture [676 x 303] intentionally omitted <==

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

QLD NSW
ACT
$1.1b $2.3b $150m
21%
8%
5%
16%
31%
50%
23%
33%
69%
26%
18%
■ Suncorp ■ Peer 3
■ Peer 1 ■ Peer 4
■ Peer 2 ■ Peer 5
----- End of picture text -----

Suncorp Group Data Pack

Source: Respective state regulator

11 February 2016

• as at 30 November 2015 *as at 30 September 2015

47

Commercial Insurance

==> picture [98 x 30] intentionally omitted <==

Distribution by channel – non-statutory

==> picture [274 x 271] intentionally omitted <==

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

7%
19%
74%
----- End of picture text -----

■ Intermediaries ■ Resilium ■ Direct

Suncorp Group Data Pack

11 February 2016

48

Commercial Insurance

==> picture [98 x 30] intentionally omitted <==

Key ratios

Acquisition expenses ratio

==> picture [314 x 93] intentionally omitted <==

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

15.9% 15.8% 15.8%
14.8%
14.0%
1H14 2H14 1H15 2H15 1H16
----- End of picture text -----

Loss ratio

==> picture [317 x 101] intentionally omitted <==

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

78.9% 78.6%
70.1%
67.1%
59.8%
1H14 2H14 1H15 2H15 1H16
----- End of picture text -----

Other underwriting expenses ratio

==> picture [304 x 74] intentionally omitted <==

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

11.0%
9.7%
9.3%
8.8% 8.8%
1H14 2H14 1H15 2H15 1H16
----- End of picture text -----

Total operating expense ratio

==> picture [306 x 61] intentionally omitted <==

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

25.2%
25.0%
24.5% 24.6% 24.6%
1H14 2H14 1H15 2H15 1H16
----- End of picture text -----

Suncorp Group Data Pack

11 February 2016

49

==> picture [98 x 30] intentionally omitted <==

==> picture [142 x 43] intentionally omitted <==

New Zealand Insurance

“Creating value for our customers”

New Zealand Insurance

==> picture [98 x 30] intentionally omitted <==

P&L

	HY16	HY15	%∆
GWP Net earned premium	621 512	605 479	2.6 6.9
Net incurred claims	(276)	(241)	14.5
Acquisition expenses	(120)	(114)	5.3
Other underwriting expenses	(48)	(46)	4.3
Total operating expenses	(168)	(160)	5.0
Underwriting result	68	78	(12.8)
Investment income – insurance funds	6	13	(53.8)
Insurance trading result	74	91	(18.7)

Key highlights

• 2.6% GWP growth coming from unit growth in direct and intermediated channels

• Impacted by increased frequency in commercial large loss claims

Suncorp Group Data Pack 11 February 2016

New Zealand Insurance

==> picture [98 x 30] intentionally omitted <==

Key ratios

Acquisition expenses ratio

==> picture [321 x 80] intentionally omitted <==

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

24.2%
24.0%
23.8%
23.4%
23.0%
1H14 2H14 1H15 2H15 1H16
----- End of picture text -----

Loss ratio

==> picture [320 x 98] intentionally omitted <==

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

57.6%
60.7%
54.8%
53.9%
50.3%
1H14 2H14 1H15 2H15 1H16
----- End of picture text -----

Other underwriting expenses ratio

==> picture [313 x 90] intentionally omitted <==

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

10.5%
9.6%
9.5%
9.4%
9.2%
1H14 2H14 1H15 2H15 1H16
----- End of picture text -----

Total operating expense ratio

==> picture [313 x 68] intentionally omitted <==

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

34.5%
33.4% 33.4%
32.5% 32.8%
1H14 2H14 1H15 2H15 1H16
----- End of picture text -----

Suncorp Group Data Pack

11 February 2016

52

New Zealand Insurance

==> picture [98 x 30] intentionally omitted <==

Market share* $5.2b

Market share

==> picture [205 x 211] intentionally omitted <==

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

17%
20%
5%
5%
7%
46%
----- End of picture text -----

■ Vero (Suncorp) ■ Peer 1 ■ AAI (Suncorp) ■ Peer 2 ■ Peer 3 ■ Other

Suncorp Group Data Pack

Distribution

==> picture [226 x 206] intentionally omitted <==

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

17%
52%
31%
----- End of picture text -----

• Strategic partners and financial intermediaries

• Brokers

• Direct (Call centre & online)

11 February 2016 Source: ICNZ

• as at 30 September 2015

53

==> picture [98 x 30] intentionally omitted <==

==> picture [142 x 43] intentionally omitted <==

Suncorp Bank

“Creating value for our customers”

Suncorp Bank

==> picture [98 x 30] intentionally omitted <==

Total lending assets $52.9 billion

==> picture [215 x 232] intentionally omitted <==

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

Portfolio
1%
8%
10%
81%
----- End of picture text -----

■ Commercial (SME) ■ Agri ■ Housing ■ Consumer

Geography

==> picture [210 x 200] intentionally omitted <==

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

4%
7%
10%
54%
25%
----- End of picture text -----

■ New South Wales ■ South Australia ■ Queensland and other ■ Victoria ■ Western Australia

Suncorp Group Data Pack

11 February 2016

55

Suncorp Bank

==> picture [98 x 30] intentionally omitted <==

Home lending assets $43 billion

Geography

Borrower type

==> picture [437 x 195] intentionally omitted <==

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

8%
13%
30%
51%
70% 28%
----- End of picture text -----

■ New South Wales ■ Victoria, South and ACT Australia and ■ Queensland Other

■ Investor ■ Owner occupied

■ Western Australia

Suncorp Group Data Pack

Channel

==> picture [194 x 184] intentionally omitted <==

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

37%
63%
----- End of picture text -----

■ Intermediary ■ Direct

11 February 2016

56

Suncorp Bank Commercial (SME) assets $5.2 billion

==> picture [449 x 219] intentionally omitted <==

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

Geography Industry
13% 11%
5%
35%
13% 8%
74% 17%
8% 16%
----- End of picture text -----

• Hospitality and ■ Retail accommodation ■ Services

• ■ Property ■ Manufacturing and investment mining

• ■ Construction and ■ Other development

• New South Wales

• ■ Queensland ■ Other

Suncorp Group Data Pack

==> picture [98 x 30] intentionally omitted <==

==> picture [202 x 246] intentionally omitted <==

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

Exposure size
2%
10%
20%
54%
14%
■ < $5 million
----- End of picture text -----

• $5-$10 million

• ■ $10-$25 million ■ $25-$50 million ■ $50-$100 million

11 February 2016

57

Suncorp Bank

==> picture [98 x 30] intentionally omitted <==

Agri assets $4.3 billion

Geography

Industry

Exposure size

==> picture [681 x 224] intentionally omitted <==

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

16% 6%
9% 30%
3%
3% 24%
29%
8% 49%
62%
10%
21%
30%
■ Queensland ■ Beef ■ Sugar ■ < $5 million ■ $10-$25 million
■ New South Wales ■ Grain and mixed ■ Cotton ■ $5-$10 million ■ $25-$50 million
----- End of picture text -----

• Queensland

• ■ New South Wales ■ Other

■ Beef ■ Sugar ■ Grain and mixed ■ Cotton farming ■ Fruit ■ Sheep and mixed ■ Other livestock

Suncorp Group Data Pack 11 February 2016

58

Suncorp Bank Credit quality – gross impaired and past due loans

==> picture [98 x 30] intentionally omitted <==

Gross impaired loans by segment ($m)

Past due home loans (% gross home loans)

==> picture [280 x 216] intentionally omitted <==

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

206
99
67
51
62
42
208
182 162
139
125
109
34 28 26 33 31 25
2H13 1H14 2H14 1H15 2H15 1H16
Commercial/SME lending Agribusiness lending Retail lending
----- End of picture text -----

==> picture [372 x 202] intentionally omitted <==

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

0.98%
0.93%
0.79% 0.78%
0.74%
0.69%
0.05%
-0.01%
2H13 1H14 2H14 1H15 2H15 1H16
Total home lending Home lending impaired HL Loss Rate
----- End of picture text -----

Suncorp Group Data Pack

11 February 2016

59

Suncorp Bank

==> picture [98 x 30] intentionally omitted <==

Credit quality - impairments

Impairment losses to gross loans

Net impaired loans to gross loans

==> picture [670 x 173] intentionally omitted <==

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

0.38%
0.24%
0.29%
0.28%
0.27%
0.18% 0.24%
0.17% 0.22%
0.14%
0.13% 0.13%
0.16%
0.04%
SUN Regional Regional Major 1 Major 2 Major 3 Major 4 SUN Regional Regional Major 1 Major 2 Major 3 Major 4
1 2 1 2
----- End of picture text -----

Source: Latest peer financial reports

Suncorp Group Data Pack

11 February 2016

60

Suncorp Bank Asset growth and credit quality ($m) Commercial (SME) portfolio

Asset growth and credit quality ($m)

==> picture [323 x 209] intentionally omitted <==

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

5,772
5,666
5,593
5,531
5,353
5,297
5,203
1H13 2H13 1H14 2H14 1H15 2H15 1H16
Commercial portfolio ($m) Impaired assets/Total portfolio (%)
1.56%
0.88% 1.00% 0.88% 1.20% 1.16% 0.81%
----- End of picture text -----*

==> picture [98 x 30] intentionally omitted <==

Agribusiness portfolio

==> picture [325 x 192] intentionally omitted <==

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

4,624
4,534
4,484
4,400
4,311
4,258
4,039
1H13 2H13 1H14 2H14 1H15 2H15 1H16
Agribusiness portfolio ($m) Gross impaired assets/Total portfolio (%)
4.50%
4.06%
3.58%
3.22%
2.83%
2.46% 2.56%
----- End of picture text -----

Suncorp Group Data Pack 11 February 2016

61

Suncorp Bank

==> picture [98 x 30] intentionally omitted <==

Liquidity

Long-term funding profile ($m)

Covered Bond Senior Unsecured (Domestic) Senior Unsecured (Offshore)

1,400 1,200 1,000 800 600 400 200 0

==> picture [624 x 155] intentionally omitted <==

Suncorp Group Data Pack

11 February 2016

62

Suncorp Bank Key ratios Lending growth (annualised)

==> picture [207 x 107] intentionally omitted <==

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

6.49%
4.06%
3.58%
3.17%
1.37%
1H14 2H14 1H15 2H15 1H16
----- End of picture text -----

Impairment losses to gross loans and advances (annualised)

==> picture [208 x 96] intentionally omitted <==

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

0.32%
0.18% 0.17%
0.06% 0.04%
1H14 2H14 1H15 2H15 1H16
Suncorp Group Data Pack
----- End of picture text -----

Net interest margin (interest-earning assets)

==> picture [207 x 99] intentionally omitted <==

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

1.86% 1.85%
1.83%
1.78%
1.66%
1H14 2H14 1H15 2H15 1H16
----- End of picture text -----

Return on Common Equity Tier 1

==> picture [206 x 98] intentionally omitted <==

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

13.11%
12.13% 12.21%
8.78%
7.59%
1H14 2H14 1H15 2H15 1H16
----- End of picture text -----

==> picture [98 x 30] intentionally omitted <==

Cost to income ratio

==> picture [206 x 108] intentionally omitted <==

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

59.57%
55.48%
54.64%
53.01%
52.19%
1H14 2H14 1H15 2H15 1H16
----- End of picture text -----

Deposit to loan ratio

==> picture [206 x 106] intentionally omitted <==

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

66.10%
65.80%
65.70%
65.60%
65.30%
1H14 2H14 1H15 2H15 1H16
----- End of picture text -----

11 February 2016

63

Suncorp Bank

==> picture [98 x 30] intentionally omitted <==

Market share by product

==> picture [686 x 243] intentionally omitted <==

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

3.1%
2.9%
2.5%
2.2%
2.1%
1.6%
1.3%
0.3%
----- End of picture text -----

Total Deposits Household/Retail Business Deposits Mortgage Lending Mortgage Lending Mortgage Lending Consumer Lending Business Lending Deposits (Owner-Occupied) (Investment)

Suncorp Group Data Pack

11 February 2016 Source: APRA

64

Suncorp Bank Retail banking market share

==> picture [550 x 355] intentionally omitted <==

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

Retail banking market share
Branch
Business centre
122
ATM 1.8%
19
9
10.0%
11
0.8% 524
1
151 1
0.3%
1
0.8% 40
245
3
0.5% 414
9
1
0.3% 1
Suncorp Group Data Pack 545
Source: Roy Morgan 48
----- End of picture text -----

==> picture [175 x 25] intentionally omitted <==

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

Suncorp Group Data Pack
11 February 2016 Source: Roy Morgan
----- End of picture text -----

==> picture [98 x 30] intentionally omitted <==

65

Suncorp Bank

==> picture [98 x 30] intentionally omitted <==

Home lending assets $43 billion

Home Lending Assets by LVR

Home Lending New Business by LVR

==> picture [681 x 261] intentionally omitted <==

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

17% 15% 12% 12% 9% 5% 3% 2%
17% 9% 9%
22% 26% 12%
24% 23%
23%
22%
13%
8%
87% 88%
84%
69%
61% 62% 64% 66% 66% 71%
1H14 2H14 1H15 2H15 1H16 1H14 2H14 1H15 2H15 1H16
■ 0 - 80%
Suncorp Group Data Pack ■ 80.01 % - 90%
■ 90.01% +
----- End of picture text -----

11 February 2016

66

Suncorp Bank

==> picture [98 x 30] intentionally omitted <==

Capital

Suncorp Bank capital levels

==> picture [324 x 195] intentionally omitted <==

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

4,266
931 3.05% RWA
450 1.47% RWA
2,885 9.45% RWA
----- End of picture text -----

1H16

• Common equity tier 1

• Additional tier 1 capital

• ■ Tier 2 capital

Risk weighted assets

==> picture [312 x 184] intentionally omitted <==

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

30,539
3,304
136
27,099
----- End of picture text -----

1H16

• Credit risk

• ■ Market risk ■ Operational risk

Suncorp Group Data Pack

11 February 2016

67

==> picture [98 x 30] intentionally omitted <==

==> picture [142 x 43] intentionally omitted <==

Suncorp Life

“Creating value for our customers”

Suncorp Life

==> picture [98 x 30] intentionally omitted <==

Inforce - $1 billion

Product

Geography

==> picture [445 x 191] intentionally omitted <==

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

7%
3%
21%
28%
25% 47%
7%
10%
20%
14% 18%
----- End of picture text -----

• New South Wales ■ South Australia

• ■ Queensland and Northern ■ Victoria and Territory Tasmania ■ New Zealand

• Trauma

• Term and TPD

• ■ Disability income ■ Other ■ Group

• Western Australia

• Suncorp Group Data Pack

Distribution

==> picture [206 x 199] intentionally omitted <==

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

10%
20%
64%
6%
----- End of picture text -----

• Advised

• ■ Direct via GI ■ New Zealand ■ Group and Other

11 February 2016

69

Suncorp Life

==> picture [98 x 30] intentionally omitted <==

New business premiums - $50 million

Distribution

Geography

==> picture [679 x 298] intentionally omitted <==

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

Geography Product Distribution
8%
6%
24% 24%
20%
24%
4% 52%
58%
9% 16% 16%
22%
17%
■ New South Wales ■ South Australia
■ Trauma ■ Advised
■ Queensland and Northern
■ Term and TPD ■ Direct via GI
■ Victoria and Tasmania ■ Territory New Zealand ■ Disability income ■ New Zealand
■ Other
■ Western Australia ■ Group and Other
Suncorp Group Data Pack
----- End of picture text -----

11 February 2016

70

Suncorp Life

==> picture [98 x 30] intentionally omitted <==

Market share- Individual risk (Australia)*

==> picture [556 x 249] intentionally omitted <==

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

Inforce
New Business
$9.07b
$1.1b
8% 6%
14%
8%
22%
■
Suncorp
5% 14% ■ Peer 1 5%
■ Peer 2
■ Peer 3
10%
■ Peer 4
8%
16%
■ Peer 5
14%
■ Peer 6
11% ■ Peer 7 8%
■ Other
13%
13%
11% 14%
----- End of picture text -----

Suncorp Group Data Pack

**as at September 2015

11 February 2016

• Data source: NMG consulting

71

Suncorp Life

==> picture [98 x 30] intentionally omitted <==

Market share - distribution

==> picture [569 x 253] intentionally omitted <==

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

Direct Bank
$1b $2.3b
1% 2%
2% [6% ] 8% 2% 4%
3% 2% ■ 2%
Suncorp
4%
■ Peer 1 17%
5% ■ Peer 2 33%
■ Peer 3
■ Peer 4
36%
■ Peer 5
■ Peer 6
18%
■ Peer 7
34% ■ Other
21%
----- End of picture text -----

Suncorp Group Data Pack 11 February 2016

**as at September 2015

• Data source: NMG consulting

72

Suncorp Life

==> picture [98 x 30] intentionally omitted <==

Market share - distribution

==> picture [552 x 246] intentionally omitted <==

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

IFA Group
$5.8b $6.4b
9% 11% 8% 1%
5% 8%
■ 23%
Suncorp
■ Peer 1
7%
■ Peer 2 8%
23% ■ Peer 3
8% ■ Peer 4
■ Peer 5 9%
■ Peer 6
10%
■ Peer 7 21%
9%
■ Other
15%
12%
13%
----- End of picture text -----

Suncorp Group Data Pack 11 February 2016

**as at September 2015

• Data source: NMG consulting

73

Suncorp Life

==> picture [98 x 30] intentionally omitted <==

Key metrics

Planned margins ($m)

==> picture [317 x 92] intentionally omitted <==

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

49 29%
35
22
17
1H13 1H14 1H15 1H16
----- End of picture text -----

Total operating expenses ($m)

==> picture [320 x 102] intentionally omitted <==

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

150 flat
147
142 142
1H13 1H14 1H15 1H16
----- End of picture text -----

==> picture [317 x 281] intentionally omitted <==

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

Claims and lapse experience 14%
7 8
(27)
(29)
1H13 1H14 1H15 1H16
VOYS ($m)
46
35
28%
23
18
1H13 1H14 1H15 1H16
----- End of picture text -----

Suncorp Group Data Pack

11 February 2016

74

Suncorp Life

==> picture [98 x 30] intentionally omitted <==

IFA commission structures

	Current (1 year responsibility period)	Jul-16 (2 year responsibility period)	Jul-17 (2 year responsibility period)	Jul-18 (2 year responsibility period)
Upfront commission	110%	88%	77%	66%
Trail commission	11%	22%	22%	22%

Suncorp Group Data Pack

11 February 2016

75

Suncorp Life

==> picture [98 x 30] intentionally omitted <==

Capital

Suncorp Life capital levels

==> picture [317 x 167] intentionally omitted <==

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

541
2.09x PCA
100
441
----- End of picture text -----

1H16 1H16

• Common equity tier 1

• Additional tier 1 capital

• ■ Tier 2 capital

Suncorp Group Data Pack

Prescribed Capital Amount

==> picture [317 x 158] intentionally omitted <==

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

259
14
48
37
105
80
-25
1H16 1H16
----- End of picture text -----

• Insurance risk charge ■ Combined stress

• ■ Asset risk charge scenario adjustment ■ Operational risk charge ■ Other regulatory ■ Aggregation benefit requirements

11 February 2016

76

==> picture [98 x 30] intentionally omitted <==

==> picture [142 x 43] intentionally omitted <==

Economy

“Creating value for our customers”

Favourable economic fundamentals

==> picture [98 x 30] intentionally omitted <==

Australian economic growth

Other key metrics supportive

		Other key metrics supportive	Other key metrics supportive	Other key metrics supportive	Other key metrics supportive
0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0	2011a 2012a 2013a 2014a 2015e 2016f 2017f Source: Consensus Economics Annual % Change		Australia	Queensland	Data as at:
		Population Growth (pa)	1.4%	1.2%	Jun-15
		Unemployment Rate	5.8%	5.8%	Dec-15
		Inflation	1.7%	1.7%	Dec-15
		Budget Position	$33bn deficit (2.0% of GDP)	$1bn deficit (0.4% of GSP)	2015/16 forecast
		Credit Rating (S&P/Moody’s)	AAA / Aaa	AA+ / Aa1	Feb-16

• Australia continues to see moderate economic growth despite the impact from the resources sector.

• Consensus forecasts expect growth to improve through 2016 and 2017.

Suncorp Group Data Pack

• Fundamentals remain positive for both Australia and Queensland.

• Australia has also retained its AAA credit rating.

• Population growth continues to support economic activity while unemployment has declined.

11 February 2016

78

Monetary policy is supporting activity

==> picture [98 x 30] intentionally omitted <==

Inflation & interest rates

Lending growth

==> picture [310 x 186] intentionally omitted <==

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

8
Source: ABS, RBA, Bloomberg
7 %
6
5
4
3
Inflation Target Range
2
1
Jan-11 Jan-12 Jan-13 Jan-14 Jan-15 Jan-16
Std Var Mortgage Rate RBA Cash Rate
----- End of picture text -----

==> picture [315 x 189] intentionally omitted <==

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

12
Annual % Change
10
8
6
4
2
0
-2
Source: RBA
-4
Dec-10 Dec-11 Dec-12 Dec-13 Dec-14 Dec-15
Total Credit Business Total Housing Investor Housing
----- End of picture text -----

• The RBA’s most recent reduction in the cash rate was in May 2015.

• Recent RBA commentary notes that the economy strengthened during 2015 yet financial market volatility has created uncertainty.

• Credit growth remains stable. The increase in business loans has been offset by slower growth in residential investor lending following the macro-prudential measures taken by APRA in 2015.

Suncorp Group Data Pack

11 February 2016

79

Favourable trends in building and labour

==> picture [98 x 30] intentionally omitted <==

==> picture [685 x 230] intentionally omitted <==

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

Building approvals Labour market
240,000 Source: ABS, Bloomberg, Suncorp 12 100 6.4
Annual approvals per '000 Change Per Month ('000)
of population (RHS)
220,000 11 75
6.1
200,000 Annual 10 50
5.8
approvals (LHS)
180,000 9 25
5.5
160,000 8 0
5.2
140,000 7 -25
Source: Bloomberg
120,000 6 -50 4.9
Dec-85 Dec-90 Dec-95 Dec-00 Dec-05 Dec-10 Dec-15 Dec-11 Dec-12 Dec-13 Dec-14 Dec-15
Employment Unemployment Rate (%)
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• Dwelling approvals are at long term highs. However adjusting for population growth, high levels of residential building activity are likely to continue.

• The non-residential building market continues to improve albeit gradually.

• Labour market conditions continue to improve, with employment growth at the strongest levels since 2006.

• The unemployment rate has decreased to 5.8% from 6.0%.

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Other indicators are mixed

Confidence indicators

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15
Index
Business Conditions
10
Business Confidence
5
0
-5
Sources:
National Australia Bank
-10 Bloomberg
Dec-10 Dec-11 Dec-12 Dec-13 Dec-14 Dec-15
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• Business and consumer confidence indicators improved through 2015 and remain above average despite continued been volatility.

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Shifting export trends

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18,000 7,000
$m $m
17,000 6,500
Service
16,000 6,000
Exports (RHS)
15,000 5,500
14,000 5,000
13,000 4,500
12,000 4,000
Mining Exports (LHS)
11,000 3,500
Source: ABS
10,000 3,000
Nov-10 Nov-11 Nov-12 Nov-13 Nov-14 Nov-15
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• Australia’s exports continue to rebalance due to a more competitive AUD.

• Service exports such as tourism and education performed well in 2015.

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Household financial conditions

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Debt and debt servicing

House prices

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200 14
% Interest payments %
190 to disposable 12
income (RHS)
180 10
170 8
160 Debt to disposable 6
income (LHS)
150 4
140 Household savings 2
rate (RHS)
130 0
Source: RBA
120 -2
Sep-00 Sep-05 Sep-10 Sep-15
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• Notwithstanding the lift in household borrowing, interest payments have fallen, savings have been maintained and unemployment has fallen.

• Meanwhile, the RBA notes that “indicators suggest that household financial stress remains fairly benign”

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1,000 Median House Price ($ '000)
900
800
700
600
500
400
300
Source: Bloomberg, ABS
200
Jun-05 Jun-08 Jun-11 Jun-14
Sydney Melbourne Brisbane
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• Increases in house prices have boosted household wealth.

• House prices in Brisbane are now showing a clear affordability advantage.

• (Financial Stability Review October 2015).

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Queensland prospects

State economic growth

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3.7%
3.0%
0.1%
2.5%
1.4%
Gross State Product 2016 forecast
Source: Deloitte Access
Economics, Sep-15 3.0%
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• Queensland is forecast to lead state growth in 2016, assisted by a diversified economic base.

• The pullback in resources has however had an impact beyond measures of real economic growth.

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Queensland building approvals

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240,000 Source: ABS, Bloomberg, Suncorp 12
Annual approvals per '000
of population (RHS)
220,000 11
Annual
200,000 approvals (LHS) 10
180,000 9
160,000 8
140,000 7
120,000 6
Dec-85 Dec-00 Dec-15
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• Queensland saw a buoyant residential building market over 2015.

• However, population growth of >2% per annum over the past decade means that building levels adjusted for population are only back at average levels.

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Glossary

“Creating value for our customers”

Glossary

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Acquisition expense ratio	Acquisition expenses expressed as a percentage of net earned premium
Cash earnings	Net profit after tax adjusted for the amortisation of acquisition intangible assets, the write down of Life intangible assets, the profit or loss on divestments and their tax effect
Cash earnings per share	Basic: cash earnings divided by the weighted average number of ordinary shares (net of treasury shares) outstanding during the period Diluted: cash earnings adjusted for consequential changes in income or expenses associated with the dilutive potential ordinary shares divided by the weighted average number of diluted shares (net of treasury shares) outstanding during the period
Cash return on average shareholders' equity	Cash earnings divided by average equity attributable to owners of the Company. Averages are based monthly balances over the period. The ratio is annualised for half years
Combined operating ratio	The percentage of net earned premium that is used to meet the costs of all claims incurred plus pay the costs of acquiring (including commission), writing and servicing the General Insurance business
Common Equity Tier 1 (CET1)	Common Equity Tier 1 Capital comprises accounting equity plus adjustments for intangible assets and regulatory reserves
Common Equity Tier 1 ratio	Common Equity Tier 1 divided by the Prescribed Capital Amount for Life and General Insurance, or total risk-weighted assets for the Bank
Connected Customer	Connected Customers are active customers holding at least two Suncorp products or services.
Cost to income ratio	Operating expenses of the Banking business divided by total income from Banking activities
Credit risk-weighted assets	Total of the carrying value of each asset class multiplied by their assigned risk weighting, as defined by APRA
Deferred acquisition costs (DAC)	The portion of acquisition costs not yet expensed on the basis that it can be reliably measured and it is probable that it will give rise to premium revenue that will be brought to account in subsequent financial periods
Deposit to loan ratio	Total retail deposits divided by total loans and advances, excluding other receivables
Diluted shares	Diluted shares is based on the weighted average number of ordinary shares outstanding during the period adjusted for potential ordinary shares that are dilutive in accordance with AASB 133 Earnings per Share
Fire service levies (FSL)	The expense relating to the amount levied on policyholders by insurance companies as part of premiums payable on policies with a fire risk component, which is established to cover the corresponding fire brigade charge which the Group will eventually have to pay
General Insurance – Commercial	Commercial products consist of commercial motor insurance, commercial property insurance, marine insurance, industrial special risk insurance, public liability and professional indemnity insurance, workers’compensation insurance and compulsory third party insurance
General Insurance – Personal	Personal products consist of home and contents insurance, motor insurance, boat insurance, and travel insurance

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Glossary

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Insurance Trading Result	Underwriting result plus investment income on assets backing technical reserves
Insurance Trading Ratio (ITR)	The insurance trading result expressed as a percentage of net earned premium
Life insurance policyholders' interests	Amounts due to an entity or person who owns a life insurance policy. This need not be the insured. This is distinct from shareholders’ interests
Life risk in-force annual premiums	Total annualised statistical premium for all business in-force at the date (including new business written during the period)
Life risk new business annual premiums	Total annualised statistical premium for policies issued during the reporting period
Life underlying profit after tax	Life underlying profit refers to net profit after tax less market adjustments. Market adjustments represents the impact of movements in discount rates on the value ofpolicyliabilities,investment income experience on invested shareholder assets and annuities mismatches
Loss ratio	Net claims incurred expressed as a percentage of net earned premium. Net claims incurred consist of claims paid during the period increased (or decreased)bythe increase(decrease)in outstandingclaims liabilities
Net profit after tax	Net profit after tax attributable to owners of the Company derived in accordance with Australian Accounting Standards
Other underwriting expenses ratio	Other underwriting expenses expressed as a percentage of net earned premium
Payout ratio – cash earnings	Ordinary shares (net of treasury shares) at the end of the period multiplied by ordinary dividend per share for the period divided by cash earnings
Payout ratio – net profit after tax	Ordinary shares (net of treasury shares) at the end of the period multiplied by the ordinary dividend per share for the period divided by profit after tax
Profit after tax from business lines	The net profit after tax for the General Insurance, Bank and Life business lines
Return on average shareholders' equity	Net profit after tax divided by average equity attributable to owners of the Company. Averages are based monthly balances over the period. The ratio is annualised for halfyears
Total operating expense ratio	Total operating expenses (acquisition and other underwriting expenses) expressed as a percentage of net earned premium
Total risk-weighted assets	Bank credit risk-weighted assets, off-balance sheet positions and market risk capital charge and operational risk charge, as defined by APRA
Treasury shares	Ordinary shares of Suncorp Group Limited that are acquired by subsidiaries

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Important disclaimer

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This report contains general information which is current as at 11 February 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 Group or any product or service offered by Suncorp or any of its subsidiaries. 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 report should be read in conjunction with all other information concerning Suncorp filed with the Australian Securities Exchange (ASX).

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’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’s control, which may cause actual results to differ materially from those expressed or implied.

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

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