A Clear, Differentiated Strategy
Delivering Consistent Returns
Philip Chronican
CEO Australia
6 May 2011Australia region - 70% of Group profit
Pro Forma Net Profit After Tax

1H11 revenue by business1$m10%

2,150

29%

1,950

Commercial

22%

1,750

Wealth671 Institutional

Institutional

1,550
38%

1,350
1,150950

434 Commercial
1,733

1,927

1,962
186 Wealth750

1H11 NPAT by business19%
34%

550
350

22%

WealthAus. Division$1,329m-50Group Centre

1H10

2H10

1H11RetailCommercial

709 Retail150

1.

Retail

1H11 bysegment

Excludes Group Centre and Other2

Institutional35%

Retail – pre provision profit up 7% with interest incomeup 8%, strong growth in deposits
1H11 v
2H10

1H11 v
1H10Profit before credit impairment and income tax

7%5%

Net profit after tax

2%

3%

1H11 Growth v System HOH1

PBP growth (HOH)
15%

1.6x

14%

10%
7%

1.2x

5%

5%

0%-2%-2%

1H10

2H10-5%Mortgages

Household Deposits

1H09

1. Source: APRA Statistics

3

2H09

1H11

Wealth – integration progressing well, strong insurance
resultInsurance in-force premiums$mFunds Under Management
Up 2%$m

Up 12%

1,230

1,3201,381

44,60844,49345,456

1H10

2H10

1H11

1H10

2H10

1H11General Insurance

IndividualGroupANZ Trustees
Global Equities

Ppty & Inf ra'ure.
Aus. Equities

Cash and FI• Integration of former INGA business on track including OnePath new brand launch• New ANZ Wealth business created (including OnePath, Private Bank and Investment and Insurance) andmanagement bench-strength improved• Wealth NPAT down $41m primarily due to reduced net interest income (repayment of loans)• Other operating income higher due to insurance book growth and favourable claims experience
offsetting higher funding costs and brokerage margin tightening• Operating expenses flat HOH• Strong growth across the insurance segments particularly in individual life
• Funds management growth subdued in difficult market conditions coupled with business transformation• $11m gross impact in General Insurance due to natural disasters (includes ex-gratia payments to policyholders).
4

Good outcomes for Business Bank & Small
Business, tougher conditions in Regional Commercial
Net interest income SBB & BB$mSBB

Business Banking

600524550

Net loans and advances incl.
acceptances & customer deposits
$b580

50.0

NLA46.2

45.7

44.5

40.0

400

Deposit

33.2

37.2

33.7

30.0

200

20.0--10.0

1H102H101H10

1H11Investment in frontline FTE
staff in 2H102,836

2H10

1H11Customer growth(„000s; Main Bank Relationship)2,3,4
202,80615

Peer 1

Peer 2Peer 3

ANZ

102,58186425-

1H10

2H10

1H11Jan-10

Apr-10Jul-10

Oct-10Jan-11

1. Small Business Banking (SBB), Business Banking (BB), Regional Commercial Banking (RCB); 2. Source: DBM Business Financial Services Monitor; 3.
Based on rolling 12 months average and includes businesses that have changed MFI during the last 12 months; 4. Includes customers who did not have a
MFI 12 months ago (start up businesses)

5Mortgage market observations
Credit Quality• Increase in 90 day delinquencies
 South East Queensland – higher than national average unemployment,
impacted by stronger AUD (tourism), natural disasters
 2008 vintage greater propensity for stress Credit underwriting tightened considerably at the end of 2008 and ANZ took amore cautious approach to volume than some peers in 2009

Competition will increase with volume reduction• ANZ traditional strategy remains in place – seek to be at median on
price and focus on quality
Unique opportunities arise from leveraging Super Regional strategy• 20% of new-to-bank customers are new arrivals• Relationship prior to leaving home country• Capability to conduct credit applications and verifications offshore forthese customers
6Regional Commercial Banking – impacted by higher
provisioning
Significant pay down of debt occurring
after high agri cash inflows

Regional Australia• Normal seasonality impact on lending more
pronounced due to weather conditions

Productive Loans v. Deposit FUM• Stress not homogenous, some areas impacted
positively, crop yield improvement

Productive Loans($b)• Commodity prices are trending up and demand isstrong. Expect a good season for broad acre

14.0

Deposit FUM($b)

Pay down ofdebt

13.0

Business Performance• Deposits up 12% HOH, 20% PCP$0.6b• Lending down 3% HOH, flat PCP

14.0

13.0

12.0
11.0

• Revenue down 1% HOH, expenses flat

Credit Quality

10.0• Long-term stress coupled with more recent
extreme weather events such as flooding.
Delinquency trends higher in Western Australia(prolonged drought) while full effect ofQueensland (Cyclone Yasi and flooding) is yet toemerge• Majority of collective provision overlay forCommercial is related to RCB

9.0

12.0

8.0
7.0
11.0
Oct-086.0
Jul-09Productive Loans

7

Apr-10Jan-11

Deposit FUM

ANZ Australia has a clear growth agenda
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

23

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
experience8Super Regional capabilities providing differentiatedsources of growth across the bank
Retail Banking across Asia
Pacific:

Commercial Banking acrossAsia Pacific:• From Asia Pacific:• More than $200b in trade flows
between Aust/NZ and Asia

 20% of new-to-bank customers• Experts in cash-flow

 Biggest Australian bank in Asia
Pacific• Specialist industry expertise• Enhanced online payments

 1,000 customer referrals permonth• Expertise in Renminbi markets

 Offshore account openings• Stakeholder relationships
across the region• To Australia:
 Specialist migrant branches Language capabilities
 Multi-lingual ATMS Multi-lingual marketing9Affluent segment represents a major growth
opportunity for ANZ
ANZ aspires to be the financial
provider of choice for affluent
customers for their banking andwealth needs• Affluent Program launched 2 May Dedicated customer manager
 Priority access to leading specialistsand products
 Premium service• “Whole of bank” approach to customer• Affluent market in Australia of c.900,000• Contributes 20% of Retail banking profit,
50% of Wealth profit & 25% of market
NPAT• FY14 Target Market share at 12%
 SOW at 37%• ANZ FUM growing at 20% CAGR since
2002• ANZ underweight in market share andSOW relative to peers

10Personalised service and Super Regional presence
provides clear differentiator in small business
A targeted proposition for small business• 250 dedicated small business specialists• Needs-based assessments with A-Z Reviews• Small Business Hub online• Small Business Insights online• Trade opportunities with Asia Pacific region
FY14 Target• 15-16% market share (FUM)
ANZ and small business• 358,000 customers• 13% market share(FUM)• 53% share of wallet• Shared lead on
customer satisfaction

11

Executing a coherent plan
• Good result for 1H 2011 despite challenging environment
 On track to deliver full year result
Long-term objective – to be a Super Regional bank with a market
leadership position in Australia
Executing on a coherent plan
 Grow in key customer segments
 Bring whole-of-bank to customers: easy to do business with Clear targets and strategies for Retail, Wealth and Commercial
businesses Capture new sources of growth through Super Regional capabilities

12