SUNCORP GROUP LIMITED — Audit Report / Information 2011

May 11, 2011

12 May 2011

==> picture [593 x 143] intentionally omitted <==

SUNCORP BANK APS 330 UPDATE

Suncorp today provided an update on Bank asset balances, credit quality and capital as at 31 March 2011 as required under Australian Prudential Standard 330.

Despite the recent sequence of weather events across Queensland and Victoria, credit quality remained relatively stable during the quarter to 31 March 2011.

Suncorp Bank CEO David Foster said: “At the half year result, Suncorp Bank took the prudent decision to increase our provision for bad debts by $35 million to recognise the deterioration in the Queensland economy following the flooding. At this stage, we do not believe that any further provision is required.”

In the Core Bank, impaired assets reduced to $175 million. The impairment charge of $5 million for the quarter was relatively low due to stable credit quality among commercial and agribusiness customers. An increase in arrears in the retail/mortgage portfolio has followed from the recent natural hazard events but is not expected to result in significant losses.

The subdued Queensland economy resulted in modest mortgage loan growth, however, both the commercial and agribusiness sectors experienced above system lending growth. The Core Bank deposit to loan ratio remained stable at almost 70%.

In the Non-core Bank, impaired assets reduced to $2,329 million. The impairment charge of $54 million includes a $5 million writeback of the Queensland flood impact overlay.

Non-core run-off was approximately $800 million for the quarter with the total Non-core bank lending assets reducing to $9 billion.

Total capital held by the Suncorp Bank remained strong at 13.86% of risk weighted assets. Tier 1 capital is 9.18%.

The APS 330 tables and explanatory slides are attached.

The Suncorp Group will be holding an Investor Day on Monday 30 May 2011 in Sydney. Suncorp executives, including David Foster, will be providing strategic updates at this forum.

Ends

For more information contact: Media: Jamin Smith, 07 3135 4321 Analysts / investors: Mark Ley, 07 3135 3991 Nicole Marques, 07 3135 3993

Suncorp Group Limited ABN 66 145 290 124 GPO Box 1453 Brisbane QLD 4001 www.suncorpgroup.com.au

Suncorp Bank APS 330 for quarter ending 31 March 2011

==> picture [212 x 258] intentionally omitted <==

==> picture [697 x 64] intentionally omitted <==

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

2010 AGM proxy summaryCore Bank deposits and lending assets
----- End of picture text -----

==> picture [697 x 46] intentionally omitted <==

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

Summary Core lending assets (A$bn)
----- End of picture text -----

• Year to date mortgage growth at 1.19x system

• Quarterly result impacted by weather events and broader QLD economic conditions

• Expect to return to system levels in Q4

• Moderate lending growth in SME and Agribusiness sectors

• Active management of lending and deposit mix preserves deposit to loan ratio at 69.7%

==> picture [222 x 148] intentionally omitted <==

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

Commercial Agribusiness
(SME) $3.4bn
$4.4bn 9%
11%
Consumer
$0.4bn
1%
Housing
$30.6bn
79%
----- End of picture text -----

==> picture [697 x 46] intentionally omitted <==

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

Mortgage growth vs. RBA system (6 month rolling)
----- End of picture text -----

==> picture [669 x 112] intentionally omitted <==

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

10.00%
RBA system
8.00%
Suncorp
6.00%
4.00%
2.00%
-
----- End of picture text -----

==> picture [30 x 23] intentionally omitted <==

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

2
----- End of picture text -----

==> picture [697 x 64] intentionally omitted <==

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

r u
2010 AGM pCore Bank c edit qoxy s mmaryality
----- End of picture text -----

==> picture [697 x 46] intentionally omitted <==

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

Summary Core non-performing loans trends (A$m)
----- End of picture text -----

• Deterioration in retail arrears with cyclical trend exacerbated by natural disaster disruptions

• No significant weakening in SME & Agri sectors

• Collective provision remained flat

• retail accounts well secured

• low probability of loss

• No write back of flood provisioning

==> picture [321 x 46] intentionally omitted <==

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

Impairment losses (A$m)
----- End of picture text -----

	Q3 FY11
Collective provision charge	0
Specific provision charge	5
Actual net write-offs	0
Impairment loss on loans and advances	5

Impaired assets > 90 days SME & Agribusiness > 90 days retail

==> picture [328 x 311] intentionally omitted <==

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

250
167
182
161
165 175
174
126
114
62
63 76
130 75 48 58 65 66
197
179 175
145 153 142 135 150
108
Mar-09 Jun-09 Sep-09 Dec-09 Mar-10 Jun-10 Sep-10 Dec-10 Mar-11
----- End of picture text -----

==> picture [30 x 23] intentionally omitted <==

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

3
----- End of picture text -----

==> picture [697 x 64] intentionally omitted <==

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

2010 AGM proxy summaryNon-core Bank assets
----- End of picture text -----

==> picture [697 x 46] intentionally omitted <==

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

Summary
----- End of picture text -----

• Total non-core portfolio at $9 billion

• $0.8 billion run-off for the quarter and $8.5 billion run-off since June 2009, ahead of initial target by $2.4 billion

• Opportunities for refinancing and asset sales continue across the portfolio

• 62 accounts at >$50 million

==> picture [697 x 46] intentionally omitted <==

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

Non-core Portfolio (A$m)
----- End of picture text -----

==> picture [659 x 181] intentionally omitted <==

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

20,000 Lease Finance
18,000
Corporate
16,000
14,000 Development Finance
12,000
Property Investment
10,000
8,000 440 Expected run-off
1,922
6,000 Actual run-off
4,000 3,026
2,000
0 3,651
Jun-09 Sep-09 Dec-09 Mar-10 Jun-10 Sep-10 Dec-10 Mar-11 Jun-11 Sep-11 Dec-11 Mar-12 Jun-12 Sep-12 Dec-12 Mar-13 Jun-13 Sep-13 Dec-13 Mar-14 Jun-14
----- End of picture text -----

==> picture [30 x 23] intentionally omitted <==

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

4
----- End of picture text -----

==> picture [697 x 64] intentionally omitted <==

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

2010 AGM proxy summaryNon-core Bank credit quality
----- End of picture text -----

==> picture [697 x 46] intentionally omitted <==

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

Impaired asset movements (A$m)
----- End of picture text -----

129 137 2,337 2,329 Dec-10 NSW Development Finance Settlements & other minor Mar-11 exposure adjustments

Mar-11

==> picture [697 x 46] intentionally omitted <==

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

Impairment losses (A$m) Impairment loss trend (A$m)
----- End of picture text -----

	Q3 FY11
Collective provision charge(incl. $5m overlay write-back)	16
Specific provision charge(incl. $26m IFRS adjustment)	36
Actual net write-offs	2
Impairment loss on loans and advances	54

==> picture [347 x 145] intentionally omitted <==

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

2nd quarter of half
219 1st quarter of half
282
146
76 78
136 126
73 83 92 54
1H09 2H09 1H10 2H10 1H11 2H11
Reporting periods prior to core / non-core reporting split.
Total Bank charges are materially non-core
----- End of picture text -----*

==> picture [30 x 23] intentionally omitted <==

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

5
----- End of picture text -----

==> picture [697 x 64] intentionally omitted <==

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

2010 AGM proxy summaryCapital, funding and liquidity
----- End of picture text -----

==> picture [697 x 46] intentionally omitted <==

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

Capital Update Bank capital post-NOHC restructure
----- End of picture text -----

• Transition to a Non-Operating Holding Company (NOHC) structure reduced Bank core tier 1 ratio including the repatriation of capital to the new holding company

• Non-core portfolio remains positively funded to

• Funding and Liquidity maturity

• Lower asset growth reduces need for additional wholesale funding

• Liquidity above internal targets at 21.1% to allow for pending large wholesale maturities

==> picture [320 x 325] intentionally omitted <==

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

Total Capital
13.86%
4.68%
Tier 2
2.35%
Residual Tier 1
Net Tier 1
Core Equity Tier 1
9.18%
6.83%
----- End of picture text -----

Suncorp Bank Capital as at 31 March 2011

==> picture [30 x 23] intentionally omitted <==

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

6
----- End of picture text -----

Provision for impairment	Q1 as at Sep‐10	Q1 as at Sep‐10		Q2	as at Dec‐10			Q3 as at Mar‐11
	Core	Non‐Core	Total	Core	Non‐Core	Total	Core	Non‐Core	Total
	$M	$M	$M	$M	$M	$M	$M	$M	$M
Collective Provision
Balance at the beginning of the period	65	136	201	58	139	197	83	105	188
Charge against contribution to profit	(7)	3	(4)	25	(34)	(9)	‐	16	16
Balance at the end of the period	58	139	197	83	105	188	83	121	204
Specific provision
Balance at the beginning of the period	37	434	471	48	484	532	40	374	414
Charge against impairment losses	20	82	102	5	109	114	5	36	41
Used against write‐off	(7)	2	(5)	(10)	(181)	(191)	(1)	(12)	(13)
Charge against interest income	(2)	(34)	(36)	(3)	(38)	(41)	(3)	(40)	(43)
Balance at the end of the period	48	484	532	40	374	414	41	358	399
Total provision for impairment ‐ Banking Activities	106	623	729	123	479	602	124	479	603
Equity reserve for credit loss
Balance at the beginning of the period	84	142	226	91	151	242	72	90	162
Transfer to (from) retained earnings	7	9	16	(19)	(61)	(80)	(2)	(8)	(10)
Balance at the end of the period	91	151	242	72	90	162	70	82	152
Pre‐tax equivalent coverage	130	216	346	103	128	231	100	117	218
Total provision for impairment and equity reserve for credit loss coverage ‐ Banking Activities	236	839	1,075	226	607	833	224	596	821
Provision for impairment expressed as a percentage of gross impaired assets are
as follows:
Collective Provision	29.5%	6.0%	7.9%	46.4%	4.5%	7.5%	47.4%	5.2%	8.1%
Specific Provision	24.4%	21.1%	21.3%	22.3%	16.0%	16.5%	23.4%	15.4%	15.9%
Total Provision	53.9%	27.1%	29.2%	68.7%	20.5%	23.9%	70.9%	20.6%	24.1%
Equity reserve for credit loss coverage	65.7%	9.4%	13.9%	57.5%	5.5%	9.2%	57.1%	5.0%	8.7%
Total provision and equity reserve for credit loss coverage	119.6%	36.5%	43.0%	126.3%	26.0%	33.1%	128.0%	25.6%	32.8%

Impaired Assets		Q1 as at Sep‐10	Q1 as at Sep‐10			Q2 as at Dec‐10		Q3	as at Mar‐11	as at Mar‐11
	Core	Non‐Core		Total	Core	Non‐Core	Total	Core	Non‐Core	Total
	$M	$M		$M	$M	$M	$M	$M	$M	$M
Gross balances of individually impaired loans	197	2,299		2,496	179	2,337	2,516	175	2,329	2,504
Specific provisions for impairment	(48)	(484)		(532)	(40)	(374)	(414)	(41)	(358)	(399)
Net individually impaired loan	149	1,815		1,964	139	1,963	2,102	134	1,971	2,105
Past due loans not shown as impaired assets	229	88		317	224	107	331	326	137	463
Gross non performing loans	426	2,387		2,813	403	2,444	2,847	501	2,466	2,967
Gross individually impaired assets as a percentage of gross loans	0.52%	20.01%		5.06%	0.46%	23.05%	5.15%	0.45%	24.87%	5.17%
Gross non performing loans as a percentage of gross loans	1.13%	20.77%		5.70%	1.04%	24.11%	5.82%	1.28%	26.33%	6.13%
Gross individually impaired assets as a percentage of impairment provisions and ERCL coverage	83.61%	274.10%		232.13%	79.15%	384.32%	301.66%	78.27%	389.83%	305.01%
Impairment Provisions and ERCL coverage as a percentage of credit risk weighted	1.09%	7.09%		3.22%	1.05%	5.37%	2.55%	1.03%	5.67%	2.54%
assets
Impairment losses on loans and advances		Q1 as at Sep‐10				Q2 as at Dec‐10		Q3	as at Mar‐11
	Core	Non‐Core		Total	Core	Non‐Core	Total	Core	Non‐Core	Total
	$M	$M		$M	$M	$M	$M	$M	$M	$M
Collective provision for impairment	(7)	3		(4)	25	(34)	(9)	‐	16	16
Specific provision for impairment	20	82		102	5	109	114	5	36	41
Actual net write offs	(1)	7		6	1	3	4	‐	2	2
Total	12	92		104	31	78	109	5	54	59
Impairment charge to credit RWA ‐ Period annualised	0.21%	3.11%		1.25%	0.60%	2.73%	1.33%	0.09%	2.05%	0.73%

SUNCORP-METWAY LTD APS 330 DISCLOSURE : TABLE 16 CAPITAL ADEQUACY 31 MARCH 2011

Risk Weighted Balance 31-Mar-2011 $m 33 2 1,236 243 11,881 3,504 29798 1,164 12,407 197 2812 30,667 145 1,194 - 122 95 34 1,590 32,257 428 3,072 35,757 % 9.177% 13.855%

On-Balance Sheet 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 Total Banking assets Off balance sheet positions Guarantees entered into in the normal course of Business Commitments to provide loans and advances Capital commitments Foreign exchange contracts Interest rate contracts Securitisation exposures Total off balance sheet positions Total Credit Risk capital charge Market risk capital charge Operational risk capital charge Total risk weighted assets Risk weighted capital ratios Tier 1 Total risk weighted capital ratios

SUNCORP-METWAY LTD APS 330 DISCLOSURE : TABLE 17 CREDIT RISK 31 MARCH 2011

Table 17A: CREDIT RISK BY GROSS CREDIT EXPOSURE - OUTSTANDING AS AT 31 MARCH 2011

	31-Mar-2011	Receivables due from other banks Trading securities Investment securities Loans, advances and other receivables Credit commitments Derivative instruments $m $m $m $m $m $m	Total Credit Risk $m	Impaired assets Past Due not Impaired > 90days Total not past due or impaired Specific Provisions $m $m $m $m
	Agribusiness	- - - 3,298 20 -	3,318	226 29 3,063 48
	Construction and development	- - - 3,337 151 -	3,488	1,480 69 1,939 261
	Financial services Hospitality Manufacturing Professional services Property investment	259 5,527 4,155 3,135 - 579 - - - 1,135 - - - - - 618 - - - - - 380 - - - - - 4,890 - -	13,655 1,135 618 380 4,890	- - 13,655 - 75 5 1,055 5 15 1 602 4 6 2 372 1 569 67 4,254 63
	Real estate - Mortgage	- - - 28,895 2,229 -	31,124	20 248 30,856 4
	Personal Government and public authorities Other commercial and industrial	- - - 352 - - - - - 3 - - - - - 2,452 117 -	352 3 2,569	- 7 345 - - - 3 - 113 35 2,421 13
	Total gross credit risk	259 5,527 4,155 48,495 2,517 579	61,532	2,504 463 58,565 399
	Securitisation Exposures Total including securitisation exposures	- - 1,217 1,947 30 8	3,202	3,202
		259 5,527 5,372 50,442 2,547 587	64,734	2,504 463 61,767 399
	Impairment provision		(603)	(399) (31) (173)
	TOTAL		64,131	2,105 432 61,594 399

Table 17A: CREDIT RISK BY GROSS CREDIT EXPOSURE - AVERAGE GROSS EXPOSURE OVER PERIOD - 01 JANUARY 2011 to 31 MARCH 2011

	Table 17A: CREDIT RISK BY GROSS CREDIT	EXPOSURE - AVERAGE GROSS EXPOSURE OVER PERIOD - 01 JANUARY 2011 to 31 MARCH 2011
	31-Mar-2011	Receivables due from other banks Trading securities Investment securities Loans, advances and other receivables Credit commitments Derivative instruments $m $m $m $m $m $m	Total Credit Risk $m	Impaired assets Past Due not Impaired > 90days Total not past due or impaired Specific Provisions $m $m $m $m
	Agribusiness Construction and development Financial services Hospitality Manufacturing Professional services	- - - 3,271 23 - - - - 3,426 157 - 177 5,193 4,396 3,212 - 455 - - - 1,133 - - - - - 622 - - - - - 391 - -	3,294 3,583 13,433 1,133 622 391	214 21 3,059 46 1,459 73 2,051 267 - - 13,433 - 79 5 1,049 6 14 1 607 4 6 2 383 1
	Property investment Real estate - Mortgage Personal Government and public authorities Other commercial and industrial	- - - 4,965 - - - - - 28,702 2,035 - - - - 350 - - - - - 4 - - - - - 2,609 135 -	4,965 30,737 350 4 2,744	605 57 4,303 66 15 209 30,513 4 - 8 342 - - - 4 - 121 24 2,599 15
	Total gross credit risk	177 5,193 4,396 48,685 2,350 455	61,256	2,513 400 58,343 409
	Securitisation Exposures Total including securitisation exposures Impairment provision TOTAL	- 5 1,215 2,044 31 8	3,303	3,303
		177 5,198 5,611 50,729 2,381 463	64,559 (603)	2,513 400 61,646 409 (407) (29) (167)
			63,956	2,106 371 61,479 409

Table 17B: CREDIT RISK BY PORTFOLIO

31-Mar-2011	Gross Credit Risk Exposure Average Gross Exposure Impaired assets Past Due not Impaired > 90days Specific Provisions Charges for Specific Provisions & Write offs $m $m $m $m $m $m
Claims secured against eligible residential mortgages Other retail Financial services Government and public authorities Corporate and other claims Total	31,124 30,737 20 248 4 2 352 350 - 7 - (1) 13,655 13,433 - - - - 3 4 - - - - 16,398 16,732 2,484 208 395 43
	61,532 61,256 2,504 463 399 44

Table 17C: GENERAL RESERVES FOR CREDIT LOSSES

Table 17C: GENERAL RESERVES FOR CREDIT LOSSES	Table 17C: GENERAL RESERVES FOR CREDIT LOSSES
31-Mar-2011	$m
Collective provision for impairment Ineligible CP on Past Due not Impaired Eligible Collective Provisions FITB relating to collective provision Equity Reserve for credit lossess General Reserve for Credit losses	204 (31)
	173 (52) 152
	273