Delivering a stronger
domestic franchise
ANZ Australia
Philip Chronican
CEO Australia
18 March 2011

Agenda1. Coherent strategy, consistently applied, has driven above peer
returns for ANZ Australia division
2. Business platform remediation, improved wealth and agribusinesspositioning, restructured and strengthened management team
3. Aspirations – driving competitive advantage and value creation• Drive further value from existing strong brand position - “Easy to Do
Business With”• Deliver greater options for our customers through leveraging thegroup‟s Super Regional capabilities• Customer experience led IT investment and product innovation• Increase share of wallet across our businesses

1Focus of today’s presentation – Australia Division
ANZ Australia
Focus of today

WealthRetailCommercial

WealthContribution toGroup NPAT

Australia
Region
72%

Other
28%

InstitutionalAustralia
Segment cut-over at>$40m turnover
Or >$15m lending

9%

28%

Institutional

Australia Region
NPAT Split
40%
Retail52%
Institutional Australia and Risk included within Australia geography structure
223%

Commercial

Experienced business leaders

Louis Hawke

Mark Hand

Mark Whelan

John Van Der Wielen

Managing Director
Product, Strategy &MarketingManaging Director
Retail Distribution

Managing Director
Commercial Banking(from April 2011)

Managing Director
WealthMike Cutter

John Harries

John Hogan

Gary Sterrenberg

Suzette Corr

GM Operations
Australia

Chief Financial Officer
Australia

Chief Information
Officer Australia

GM Human Resources
Australia

Chief Risk Officer
Australia

Nigel Williams
MD Institutional
Australia

3

Well positioned for a new game with new rules
Strong economic growth in Australia
yet weaker lending system growth
Australia: credit growth likely to be around nominal GDP
Business investment funding coming from equity raisings andgreater level of national savings

Competition impacts fromlower growth environment

Increasing political andregulatory overlay

Price focus
Battleground has moved
from deposits to retail lending

Cooper Review (superannuation)
Ripoll Review (advice)
Basel III (capital & liquidity)4

Coherent strategy – driving competitive advantage
Geographic opportunity• Footprint - exposure to Asia‟s more rapid growth• Growing financial services requirements• Regional connectivity• Strong domestic markets
and businesses

Leading
Super
Regional
Bank

Building Super Regional
capabilities• Bench strength/international talent• Innovative product capability• „Throw and catch‟ capability andculture• Enabling technology andoperations hubs

• Global core brand, regional reach• Governance and risk management
Cross-border customer focus• Regional customer insights• Resources, agribusiness, infrastructure• Trade and investment flows• Migration/people flows, education

5

Australia Division contributing strongly to groupthrough more convenient banking proposition
OUTPERFORM• Deepen successful strategy

RESTORE Leadership in customer
advocacy Above system growth indeposits and householdlending Business platform
remediation
 Strengthen managementteam Improve wealth offer INGA acquisition
 Improve staffengagement• Enhance strong

domestic franchise byleveraging regional
footprint- #1 bank for consumer andcommercial satisfaction and Net
Promoter Score- #1 bank for Pan-regional flows- #1 bank for trade and FX• Integrated solutions –customer focus, mainbank agenda• Build on wellestablished market
positioning – easy to
do business with• Productivity

2009-10• Peer leading staff engagement• Differentiated earnings growth• More efficient balance sheet

2011-2014
6

Using technology to create a leading customer experience– combining people, process, data and technology
Technology goals

Near-term priorities

Simplify & standardise

Invest in customer facingtechnologies
Internet & mobile platforms,e.g. online banking upgrade, sales andservice platform, MySuper, goMoney andmulti-lingual ATMs

Secure & stable base
Extend CRM platform
iKnow Borrow, iKnow Commercial

Enhance customer knowledge
Link to group wide systems
Enterprise Management(Finance, HR, Risk)
MISPayments

Deliver the business agenda

Leverage investment inexisting systems

Be well managed7

Clear principles - focus, alignment and discipline
1

Future-proof businessarchitecture• Build for the long-term

2

Investment
selection, prioritisation andgovernance• Invest in strategies, not projects

345• Combine people, process, data andCustomer proposition andexperience

technology to deliver „Uncomplicatedand People-shaped‟ experience• Embed stability and innovate from theTechnology development„front-end‟• Manage change through „bite-sized‟

Business execution

initiatives to reduce delivery risk

8

ANZ Australia

RetailRetail – positioned for continued growthAward winning distribution
network1 …

… driving customer preference(%) Future trial intention, non-bank customers

814 Branches
2,528 ATMs

20

6 types of specialists acrossour network

1624/7 Contact Centre
Innovative digital andmobile channels2

12Peer 1

8… with market leading productsPeer 3

YoY Growth 09-10
Market share

System multiple

Deposits

13.2%

1.0x

Mortgages

12.3%

1.3x

Consumer finance

18.9%

1.1x

1.
2.

Peer 240
Dec-0909

Canstar Cannex, Australia’s number one for Customer Satisfaction with distribution
Winner FIIA 2011 Asia Pacific Innovation Award (Mobile Innovation)

10Jan-10
10Dec-10

Customer experience and regional networks underpin
competitive advantage
Strategic priorities• Continue to acquire more affluent customers via
1

Target higher-value
customers

2

Deliver a distinctive
Retail customer
proposition

3

Become the bank ofchoice for migrants

4

Continuously manage
costs and productivity

targeted, relevant propositions (e.g. Visa Signature;
A-Z Reviews)• Affluent market share +0.9% 12 mths to Dec 2010

• Deliver „Uncomplicated & People-shaped‟

proposition – easy and empowering• Continue investment in brand and delivery• Differentiate through customer service and insight• Leverage Super Regional network to capture Asian
migrant and student flows• Pan-regional migrants make up ~20% of all newto market customers• Continue migration to lower cost online channels• Invest in increased automation (e.g. Retail
Lending Automation initiative)

11

Success will deliver consistent profitable market
share growth over the long term
Sustained organic share growth …

… through peer leading customer advocacy

Traditional banking market share (Index, Jan 2008=100)

Net promoter score

120
115
110
105
100
95
902008

2009

2010

2008

… and above weight trial intention

20092010… with significant upside potential(%) transactional account trial intention(% of FUM) traditional banking share of wallet
603025562052

15104850442008

2009

Peer 12010

Peer 22008

Peer 31220092010

Case study: Exception fees and SVR response
Indicative revenue impact
of fee changes 2009-10($) per bank customer1

A balanced, customer insight-led
response
Exception fees reduction
Research confirmed customers’ desire for greatertransparency was the key issue• Retained flat $5 monthly fee with no additional accountcharges and removed 27 separate fees

Out-of-cycle mortgage rate increase
Research highlighted that customers’ desire forgreater control was the key issue• “Packaged” response, including SVR increase at lower
range of peers, elimination of exit fees plus fixed rate
switching offer• Over 10,000 customers (~$3bn FUM) took-up fixed rate
switching offer (~30% new-to-bank)

ANZ

Peer 1

Peer 2Peer 3

1. Estimated total revenue loss per traditional banking customer due to deposit and credit card fee (2009) and mortgage fee (2010/11) changes

13Case study: Leveraging regional retail connectivity
through ANZ Migrant Banking channel
By 2015 15% of the Australian population will be of Asian origin
and represent over 22% of the acquirable pool of new to bank customers• Significant acquisition opportunities exist in pre-arrival and new-arrival migrant segments• ANZ‟s pan-regional network ensures we are well placed to identify and assist clients ahead of their planned
migration• A specialist Migrant Banking channel developed to ensure and seamless referral process across regions• Offering supported by a new „Moving to Australia‟ online portal and account opening tool
• Currently have 18 specialist migrant branches and an additional 340 branches with targeted language
capabilities, initiatives underway to increase the number of specialist branches during 2011.

ExampleShanghai• ANZ Relationship Manager

identifies referral opportunity fora client relocating to Australiafor work.

ANZ Migrant Banking
Referral provided to the ANZ migrantbanking team.
ANZ Migrant Banking specialist:• Determines specific language andfinancial needs of client• Commences account opening andother necessary processes• Identifies appropriate branch to be

primary relationship point for client.

14

Chinatown branch
Haymarket, Sydney• Asian banking manager isintroduced to client pre departure.

• Meeting is arranged to occur

upon arrival to finalise banking
arrangements and address anyother needs.

ANZ Australia

WealthWealth – Integrating the portfolio
Over 2.5m customers
Over 2,200 Financial Planners
nationwide, through owned andaligned dealer group network

Insurance
Superannuation & Investments

10 Private Banking suites

Private Bank

Market share position 2010
Individual Risk Insurance#3

Superannuation & Investments#5

Private Bank

#3

Investment Lending#5Online/Direct Broking#2

Strategy is to combine all existing
wealth businesses to deliver
differentiated, tiered offerings to key
customer segments

AlignedDealerGroups16

Large upside and diversified income streams
ANZ has the second largest adviser
footprint …

… with strong momentum in key
business lines

Financial Planner Footprint(% share of Planners)

Individual Risk Inflows(%; New Annual Premiums / Inforce Premiums)

3030

25

25

2820

1615161310

1110ANZ26
Peer 4249522020

Peer 1 ANZ Peer 2 Peer 3 Peer 4 Peer 5 Others

Peer 5Peer 3Peer 6Peer 1

Dec-09Mar-10Jun-10

Sep-10… with ANZ penetration a key
opportunity

Superannuation and Managed
Investments to provide growth …
Super & Investments Inflows(%; Inflow / FUM)

12Peer 3108

Peer 5Peer 4Peer 164

Peer 6ANZ

2
Dec-09Mar-10Jun-10

Sep-10
1789%
89 %

11%

WealthOpportunity

ANZ customers with an ANZ Wealth productSetting the foundations for future growth
Strategic priorities• Embed wealth offerings into ANZ customer

1Step change in ANZ
customer basepenetration• Continue to capture Superannuation Guarantee (SG)2

Capitalise onopportunities presented
by regulatory andmarket changes• Deliver a fully integrated wealth business to realise3

Leverage combined
wealth business toenhance revenue anddecrease costs

4

Enhance corecapabilities for future
growthpropositions and channels• Develop simple superannuation and insurance
productsflows (with potential increase from 9% - 12% for SG)• Enhance limited scope advice offering• Leverage our aligned dealer group distribution network

revenue and cost synergies between business units• Invest in increasing automation and online self-service
capabilities to improve efficiency and cost-to-serve• Deliver future wealth platform solution• Deliver tiered offerings to customer segments• Build our capabilities to support possible extension intoAsia

18

Case study: ING Australia transition
The transition from ING ownershipto a fully integrated ANZ Wealthbusiness …

… has demonstrated Wealth’s ability
to deliver despite complexity and achallenging timeframe

Nov 09: 100% acquisition of ING Australia‟s
51% share of the INGA/ANZ joint ventures inAustralia and New Zealand• New brand created and implemented within 8ING Wealth Mgmt

• Alignment to ANZ operations, risk /51%
INGA49%ANZ

E*TradeANZ
Financial
Planning

months - successful launch of OnePath brand in
October 2010

PrivateBankcompliance, technology and finance frameworks
with 2,067 FTEs transitioned to ANZ employment inNovember 2010
• OnePath has maintained strong businessmomentum despite transition with NPAT of$314m, up $164m on the previous result andANZ Wealth Australia

above deal assumptions• Significant revenue and cost synergies are in

Dec 10: ANZ Wealth operates as a fully
integrated businessprogress (both with the broader bank and withinWealth)19

ANZ Australia
Commercial

A differentiated Commercial Banking proposition
Customer segments range fromtransactional to high-touch …

… regional presence enables‘easy’ connection for customers
Pan-Asian countries with an ANZ Commercial presence

Customer segments
Turnover
$0

$5m

Small
Business$40m

Business
BankingSpecialist business
Agribusiness

Auto FinanceCommercial Australia is thecornerstone of an integrated
regional offering, providing
customers with access to expert
advice and solutions in 15 markets
across Asia and NZ

21

Consistent customer growth and advocacy
Customer Satisfaction1

Trial Intention(%)(„000s; Main Bank consideration)
32

7.5

30
Peer 3728

ANZANZ

Peer 126

Peer 224

Peer 2Peer 3226.5
Dec-09Peer 1Mar-10Jun-10

Sep-10

Dec-09Dec-10Mar-10Jun-10

Sep-10Dec-10

Customer Acquistion1

FY11 momentum(000s; Main Bank Relationships)

Commercial Bank

30

• Customer numbers up 6%2• Lending growth of 2.5% vs. system of 1.0%3

25

Small Business Segment

20• Number of new applications approved up 29%4ANZ

Business Banking Segment

15

Peer 1
Peer 2Peer 310• New Lending FUM approvals up 34%4
• Trade finance sales calls up 30%4
Agribusiness Segment

5Dec-09

Mar-10Jun-10

Sep-10• Increased the number of accounts opened by acquired

Dec-10Landmark customers by 16%5

1. Source: DBM; 2. 12 months to Dec-10; 3. Source: APRA Monthly Banking Statistics, Bank Lending to Non-FinancialInstitutions, Sep-10 to Dec-10; 4. Sep-09 to Dec-09 vs. Sep-10 to Dec-10; 5. Feb-10 to Dec-10
22

Clear targets and priorities
By 2014…
NPAT

Market Share

Satisfaction

35%

#2

#1of Australia profit1

Target Markets & Priorities
1Small Business Segment• Focus on net customer acquisition; represents the bulk ofCommercial customers, with strong deposits• Acquire new, larger customers and expand share of wallet;
2Business Banking Segment

3

Agribusiness Segment

4

Auto Finance Business5

Cross-Commercial

1. Australia division underlying NPAT

expand cross-border referrals and increase markets and tradesales• Net customer acquisition and cross-sell into the Landmark
business• Opportunity to increase conversion of Auto Finance customers
to main bank customers• Continue to focus on simpler processes and reduced cost

23

Case study: Building regional connectivity
ANZ’s regional capability connects customers and creates revenue opportunities.
The following is one example out of the 169 referrals made in the first quarter:
An Indonesian customer contacts
their ANZ Indonesia Commercial
Relationship Manager to talk about
additional banking requirements they
have in Australia.

CustomerIndonesia RM

ANZ Commercial Asia Presence
ANZ Commercial presence in 14
Asian markets with access to 281
Commercial frontline staff•••••

China
Hong Kong
South KoreaJapanSingapore•••••IndonesiaMalaysia
ThailandIndia
Cambodia••••

VietnamTaiwanPhilippinesLaos

ANZ Indonesia refers connects
client with a RelationshipManager in ANZ BusinessBanking Australia.
A suite of banking facilities
including $1.2m in term debt
are established.

Australia RM

ANZ Commercial Australia
Access to 1.5k frontline staff across:• 814 branches• 202 business centres
Specialists in:• Agribusiness• Property• Asset FinanceBusiness Banking RelationshipManager also identifies traderequirements and connects
client with a Trade FinanceSpecialist who arranges afurther $5.5m in facilities.

Trade Finance Specialist

ANZ Institutional Expertise
Leverage ANZ Institutional’s Asian
Trade Finance and Markets expertise

Trade Finance House ofthe Year (‟08, ‟09, ‟10)

24

Best Trade Bank inAustralia & thePacific (2009)Case study: Shanghai World Expo
The Shanghai World Expo 2010
• Largest ever World Expo attracting over 70
million visitors• ANZ was a Platinum Sponsor of the Australia
pavilion and sponsor partner of the New
Zealand pavilion

Events and Activity• ANZ hosted a series of events with a rangeof key clients and industry figures• 10 VIP events at the Australian pavilion
inviting 900 guests• Facilitated 58 VIP tours to the Australianpavilion

Takeaways• Highly valuable investment for ANZ in its

long-term client relationships, demonstrating
ANZ‟s sector and regional insight• The event demonstrated ANZ‟s superregional connectivity and emphasised that
ANZ is Australia‟s leading
Commercial/Institutional bank in connecting
clients across the region.

25

ANZ Australia
SummaryANZ Australia is well positioned for growth
Strategic priorities

1

Drive value• Growth in target segments- Service led delivery and innovation- Acquire high-quality customers and increase SOW- Drive value from brand equity and customer
advocacy• Integrate and grow Wealth• Grow Commercial

2

3

Leverage SuperRegional strategy• Bank of choice for pan-regional migrants• Maximise cross-regional commercial opportunities

Invest insustainability• Productivity agenda• Improve staff engagement• IT investment focused on enhancing customer
experience

27

The material in this presentation is general background information about the Bank‟s activities current at thedate of the presentation. It is information given in summary form and does not purport to be complete. It isnot intended to be relied upon as advice to investors or potential investors and does not take into account theinvestment objectives, financial situation or needs of any particular investor. These should beconsidered, with or without professional advice when deciding if an investment is appropriateThis presentation may contain forward-looking statements including statements regarding our intent, belief
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the result of any revisions to these forward-looking statements to reflect events or circumstances after thedate hereof to reflect the occurrence of unanticipated events.
For further information visit

www.anz.com
or contact
Jill Craig
Group General Manager Investor Relations
ph: (613) 8654.7749 e-mail: jill.craig@anz.com