ANZ Group Holdings Limited
ABN 16 659 510 791

Half Year
31 March 2024

Consolidated Financial Report
Dividend Announcement
and Appendix 4D

The Consolidated Financial Report and Dividend Announcement contains information required by Appendix 4D of the Australian Securities
Exchange (ASX) Listing Rules. It should be read in conjunction with the 2023 ANZ Group Holdings Limited Annual Report, and is lodged with
the ASX under listing rule 4.2A.

RESULTS FOR ANNOUNCEMENT TO THE MARKET

Name of Company:

APPENDIX 4D

ANZ Group Holdings Limited
ABN 16 659 510 791

Report for the half year ended 31 March 2024

Operating Results1

Statutory operating income



0%

to

10,145

Statutory profit attributable to shareholders of the Company



-4%

to

3,407

Cash profit2



-7%

to

3,552

AUD million



Dividends3

Cents

Proposed interim dividend4Frankedperamountshare

per share

83

65%

Record date for determining entitlements to the proposed 2024 interim dividend

14 May 2024

Payment date for the proposed 2024 interim dividend

1 July 2024

Dividend Reinvestment Plan and Bonus Option PlanANZ Group Holdings Limited has a Dividend Reinvestment Plan (DRP) and a Bonus Option Plan (BOP) that will operate in respect of the proposed 2024
interim dividend. For the 2024 interim dividend, ANZ intends to provide shares under the DRP through an on-market purchase and BOP through theissue of new shares. The 'Acquisition Price' to be used in determining the number of shares to be provided under the DRP and BOP will be calculated byreference to the arithmetic average of the daily volume weighted average sale price of all fully paid ANZ ordinary shares sold in the ordinary course of
trading on the ASX and Cboe Australia during a pricing period commencing on 17 May 2024, and then rounded to the nearest whole cent. The Pricing
Period will be 10 trading days or such longer period advised by ANZ before the open of trading on the day the Pricing Period begins. Shares provided
under the DRP and BOP will rank equally in all respects with existing fully paid ANZ ordinary shares. Election notices from shareholders wanting tocommence, cease or vary their participation in the DRP or BOP for the 2024 interim dividend must be received by ANZ's Share Registrar by 5.00pm(Australian Eastern Standard Time) on 15 May 2024. Subject to receiving effective contrary instructions from the shareholder, dividends payable toshareholders with a registered address in the United Kingdom (including the Channel Islands and the Isle of Man) or New Zealand will be converted toPounds Sterling or New Zealand Dollars respectively at an exchange rate calculated on 17 May 2024.

1.

Unless otherwise noted, all comparisons are to the consolidated financial information for the half year ended 31 March 2023.

2.

Cash profit excludes non-core items included in statutory profit and is provided to assist readers in understanding the result of the core business activities of the Group. The non-core items
are calculated consistently period on period so as not to discriminate between positive and negative adjustments, and comprise economic hedging and similar accounting items that
represent timing differences that will reverse through earnings in the future. The net after tax loss adjusted from statutory profit to arrive at cash profit was $145 million. Refer to pages 65 to
67 for further details.

3.

The unfranked portion of the dividend will be sourced from ANZ’s conduit foreign income account.

4.

It is proposed that the interim dividend of 83 cents will be partially franked at 65% for Australian tax purposes (30% tax rate) and carry New Zealand imputation credits of NZD 12 cents per
ordinary share.

2

ANZ GROUP HOLDINGS LIMITEDABN 16 659 510 791

CONSOLIDATED FINANCIAL REPORT, DIVIDEND ANNOUNCEMENT AND APPENDIX 4D
Half year ended 31 March 2024

CONTENTS

PAGE

Disclosure Summary5

Summary

7

Group Results

13

Divisional Results

43

Profit Reconciliation

65

Condensed Consolidated Financial Statements

69

Supplementary Information

113

Definitions

123

ASX Appendix 4D - Cross Reference Index

126

This Consolidated Financial Report, Dividend Announcement and Appendix 4D (Results Announcement) has been prepared for ANZ Group Holdings
Limited (ANZGHL, Company, parent entity) and its subsidiaries (ANZ Group, ANZ, Group, the consolidated entity, us, we, or our).
All amounts are in Australian dollars unless otherwise stated. The ANZ Group has a formally constituted Audit Committee of the Board of Directors. The
Condensed Consolidated Financial Statements were approved by resolution of the Board of Directors on 6 May 2024.
DISCLAIMER & IMPORTANT NOTICE:
The material in the Results Announcement contains general background information about the ANZ Group’s activities current as at 6 May 2024. It is
information given in summary form and does not purport to be complete. It is not intended to be and should not 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 beconsidered, with or without professional advice, when deciding if an investment is appropriate.
The Results Announcement may contain forward-looking statements or opinions including statements regarding our intent, belief or current expectations
with respect to ANZ Group’s business operations, market conditions, results of operations and financial condition, capital adequacy, specific provisions
and risk management practices. When used in the Results Announcement, the words ‘forecast’, ‘estimate’, ‘project’, ‘intend’, ‘anticipate’, ‘believe’,‘expect’, ‘may’, ‘probability’, ‘risk’, ‘will’, ‘seek’, ‘would’, ‘could’, ‘should’ and similar expressions, as they relate to ANZ Group and its management, areintended to identify forward-looking statements or opinions. Those statements are usually predictive in character; or may be affected by inaccurate
assumptions or unknown risks and uncertainties or may differ materially from results ultimately achieved. As such, these statements should not be relied
upon when making investment decisions. These statements only speak as at the date of publication and no representation is made as to theircorrectness on or after this date. Forward-looking statements constitute ‘forward-looking statements’ for the purposes of the United States Private
Securities Litigation Reform Act of 1995. ANZ Group does not undertake any obligation to publicly release the result of any revisions to these forwardlooking statements to reflect events or circumstances after the date hereof to reflect the occurrence of unanticipated events.

3

ANZ GROUP HOLDINGS LIMITEDABN 16 659 510 791
This page has been left blank intentionally

4

DISCLOSURE SUMMARY
SUMMARY OF 2024 HALF YEAR RESULTS AND ASSOCIATED DISCLOSURE MATERIALSThe following disclosure items were lodged separately with the ASX and NZX and can be accessed via the ANZ Shareholder Centre on the Groupwebsite https://www.anz.com/shareholder/centre/reporting/results-announcement/.

ANZ Group Holdings Limited•

2024 Half Year Consolidated Financial Report, Dividend Announcement and Appendix 4D•

2024 Half Year Results Investor Discussion Pack•

News Release•

Key Financial Data (available on ANZ Shareholder website only)

Australia and New Zealand Banking Group Limited•

2024 Half Year Consolidated Financial Report•

2024 March Pillar 3 Disclosure•

United Kingdom Disclosure and Transparency Rules Submission

5

DISCLOSURE SUMMARY
This page has been left blank intentionally

6

SUMMARYCONTENTS

Page

Guide to Half Year Results

8

Statutory Profit Results

9Cash Profit Results

10

Key Balance Sheet Metrics

11

Full Time Equivalent Staff

12

Other Non-Financial Information

12

7

SUMMARY
Guide to Half Year Results
DISCONTINUED/CONTINUING OPERATIONS
During the 2022 full year, all activities relating to the legacy sale of ANZ’s wealth businesses ceased. Accordingly, the Group no longer presents financial
results on a discontinued/continuing basis.
NON-IFRS INFORMATION
Statutory profit is prepared in accordance with the recognition and measurement requirements of Australian Accounting Standards, which comply with
International Financial Reporting Standards (IFRS). The Group provides additional measures of performance in the Results Announcement which areprepared on a basis other than in accordance with accounting standards. The guidance provided in Australian Securities and Investments Commission(ASIC) Regulatory Guide 230 has been followed when presenting this information.
Cash Profit
Cash profit, a non-IFRS measure, represents the Group’s preferred measure of the result of the core business activities of the Group, enabling readers toassess Group and divisional performance against prior periods and against peer institutions. To calculate cash profit, the Group excludes non-core items
from statutory profit (refer to Definitions on pages 123 to 125 for further details). The adjustments made in arriving at cash profit are included in statutory
profit which is subject to review within the context of the external auditor’s review of the Condensed Consolidated Financial Statements. Cash profit is not
subject to review by the external auditor. The external auditor has informed the Audit Committee that cash profit adjustments have been determined on aconsistent basis across each period presented.
To simplify disclosures, the Group will no longer present cash profit excluding large/notable items. However, to support understanding of the results, a
range of items impacting the results will continue to be referred to in commentary.
RESTATEMENT OF PRIOR PERIOD COMPARATIVE INFORMATION
Accounting standards adoption
The Group adopted AASB 17 Insurance Contracts (AASB 17) on 1 October 2023. Although the overall profit recognised in respect of insurance contracts
will not change over the life of contracts, the timing of revenue recognition will change. The Group applied AASB 17 effective from 1 October 2022 andrestated prior period comparative information. This resulted in a decrease in opening retained earnings of $37 million on 1 October 2022, an increase inprofit after tax (Sep 23 half: nil; Mar 23 half: $8 million), an increase in total assets (Sep 23: $22 million; Mar 23: $36 million), and an increase in total
liabilities (Sep 23: $51 million; Mar 23: $65 million) in the Australia Retail division.
Divisional results presentation
Divisional prior period comparative information was restated to reflect a number of cost reallocations across and within the divisions during the period,
with no impact to Group results.
PENDING ORGANISATIONAL CHANGES IMPACTING FUTURE REPORTING PERIODS
Suncorp Bank Acquisition
On 18 July 2022, the Group announced an agreement to purchase 100% of the shares in SBGH Limited, the immediate non-operating holding companyof Suncorp Bank. On 20 February 2024, the Australian Competition Tribunal announced it had authorised the proposed acquisition following the decisionin August 2023 by the Australian Competition and Consumer Commission to not authorise the acquisition. The acquisition remains subject to satisfactionof certain conditions, including Federal Treasurer approval and certain amendments to the State Financial Institutions and Metway Merger Act 1996
(QLD). Australia and New Zealand Banking Group Limited (ANZBGL) will also have a termination right under the Suncorp Bank Sale Agreement if APRA
issues a written communication to ANZBGL under or in connection with APS 222 Associations with Related Entities to the effect that ANZBGL must notproceed with completion of the acquisition. Assuming these conditions are satisfied, the acquisition is expected to occur in mid-calendar year 2024.

8

SUMMARY
Statutory Profit Results
Half Year

Movement

Net interest income

Mar 24$M
7,899

Sep 23$M
8,074

Mar 23$M
8,500

Mar 24v. Sep 23-2%

Mar 24v. Mar 23-7%

Other operating income

2,246

2,246

1,651

0%

36%
0%

Operating income

10,145

10,320

10,151-2%

Operating expenses(5,215)(5,142)(4,997)

1%

4%

Profit before credit impairment and income tax

4,930

5,178

5,154

-5%

-4%

(70)

(112)

(133)

-38%

-47%

Profit before income tax

Credit impairment (charge)/release

4,860

5,066

5,021

-4%

-3%

Income tax expense(1,439)(1,501)(1,452)-4%-1%

Non-controlling interests
Profit attributable to shareholders of the Company

(14)

(14)

(14)

0%

0%

3,407

3,551

3,555

-4%

-4%

Earnings Per Ordinary Share (cents)

Half Year

Basic
DilutedMovement

Mar 24113.5

Sep 23
118.4

Mar 23
118.7

Mar 24v. Sep 23-4%

Mar 24v. Mar 23
-4%

111.5

113.8

113.0

-2%

-1%

Half Year
Reference
Page

Mar 24

Sep 23

Mar 23

-

-

81

83

-

-

Ordinary Share Dividends (cents)1,2Interim- fully franked- partially franked
Final- partially franked (comprising 81 cents and an additional dividend of 13 cents)
Total
Ordinary share dividend payout ratio3
Profitability Ratios
Return on average ordinary shareholders' equity4

-

94

-

84

83

94

81

84

73.3%

79.6%

68.4%

9.7%

10.4%

10.6%

Return on average assets

0.59%

0.64%

0.64%

Net interest margin

1.56%

1.65%

1.75%

Net interest margin (excluding Markets business unit)

2.33%

2.35%

2.43%

Net interest income to average credit RWA

4.55%

4.69%

4.77%

Net interest income to average credit RWA (excluding Markets business unit)

5.10%

5.19%

5.19%

Efficiency Ratios
Operating expenses to operating income

51.4%

49.8%

49.2%

Operating expenses to average assets

0.90%

0.92%

0.90%

Credit Impairment Charge/(Release)
Individually assessed credit impairment charge/(release) ($M)

38

123

(30)

Collectively assessed credit impairment charge/(release) ($M)

32

(11)

163

70

112

133

Individually assessed credit impairment charge/(release) as a % of average gross loans and advances

0.01%

0.04%

(0.01%)

Total credit impairment charge/(release) as a % of average gross loans and advances5

0.02%

0.03%

0.04%

Total credit impairment charge/(release) ($M)
51.

Partially franked at 65% for Australian tax purposes (30% tax rate) for the proposed 2024 interim dividend (2023 final dividend: partially franked at 56%; 2023 interim dividend: fully franked).
Carry New Zealand imputation credits of NZD 12 cents for the proposed 2024 interim dividend (2023 final dividend: NZD 11 cents; 2023 interim dividend: NZD 9 cents).
Dividend payout ratio for the March 2024 half is calculated using the proposed 2024 interim dividend of $2,496 million, based on the forecast number of ordinary shares on issue at thedividend record date. Dividend payout ratios for the September 2023 half and March 2023 half were calculated using actual dividends of $2,825 million and $2,433 million respectively.
4. Average ordinary shareholders’ equity excludes non-controlling interests.
5. Credit impairment charge/(release) used in the ratio relates to gross loans and advances and off-balance sheet commitments - undrawn and contingent liabilities.
2.
3.

9

SUMMARY
Cash Profit Results1
Half Year
Mar 24$M
7,899

Net interest income

Sep 23$M
8,074

Movement
Mar 23$M
8,500

Mar 24v. Sep 23-2%

Mar 24v. Mar 23-7%

Other operating income

2,448

2,291

2,040

7%

20%

Operating income

10,347

10,365

10,5400%-2%Operating expenses(5,215)(5,142)(4,997)

1%

4%

Cash profit before credit impairment and income tax

5,132

5,223

5,543

-2%

-7%

(70)

(112)

(133)

-38%

-47%

Credit impairment (charge)/releaseCash profit before income tax

5,062

5,111

5,410

-1%

-6%

Income tax expense(1,496)(1,513)(1,567)

-1%

-5%

(14)

(14)

(14)

0%

0%

3,552

3,584

3,829

-1%

-7%

Non-controlling interests
Cash profit

Earnings Per Ordinary Share (cents)

Half Year

Movement

Basic

Mar 24118.3

Sep 23
119.5

Mar 23
127.9

Mar 24v. Sep 23-1%

Mar 24v. Mar 23-8%

Diluted

116.0

114.8

121.4

1%

-4%

Half Year
Reference
Page

Mar 24

Sep 23

Mar 23

Ordinary Share Dividends
Ordinary share dividend payout ratio2

70.3%

78.8%

63.5%

Profitability Ratios
Return on average ordinary shareholders' equity3

10.1%

10.5%

11.4%

Return on average assets

0.61%

0.64%

0.69%

Return on average RWA

1.65%

1.65%

1.70%

Net interest margin

1.56%

1.65%

1.75%

Net interest margin (excluding Markets business unit)

2.33%

2.35%

2.43%

Net interest income to average credit RWA

4.55%

4.69%

4.77%

Net interest income to average credit RWA (excluding Markets business unit)

5.10%

5.19%

5.19%

Efficiency Ratios
Operating expenses to operating income

50.4%

49.6%

47.4%

Operating expenses to average assets

0.90%

0.92%

0.90%

Credit Impairment Charge/(Release)
Individually assessed credit impairment charge/(release) ($M)

38

123

(30)

Collectively assessed credit impairment charge/(release) ($M)

32

(11)

163

Total credit impairment charge/(release) ($M)

70

112

133

Individually assessed credit impairment charge/(release) as a % of average gross loans and advances4

23

0.01%

0.04%

(0.01%)

Total credit impairment charge/(release) as a % of average gross loans and advances4

0.02%

0.03%

0.04%

1.

Cash profit excludes non-core items included in statutory profit and is provided to assist readers in understanding the results of the core business activities of the Group. Refer to pages 65 to
67 for the reconciliation between statutory and cash profit.
2. Dividend payout ratio for the March 2024 half is calculated using the proposed 2024 interim dividend of $2,496 million, based on the forecast number of ordinary shares on issue at thedividend record date. Dividend payout ratios for the September 2023 half and March 2023 half were calculated using actual dividends of $2,825 million and $2,433 million respectively.
3. Average ordinary shareholders’ equity excludes non-controlling interests.
4. Credit impairment charge/(release) used in the ratio relates to gross loans and advances and off-balance sheet commitments - undrawn and contingent liabilities.

10

SUMMARY
Key Balance Sheet Metrics
As at
Reference
Page

Movement

Mar 24

Sep 23

Mar 23

Mar 24v. Sep 23

Mar 24v. Mar 23

Capital Management (Level 2)
Common Equity Tier 1- APRA

38

13.5%

13.3%

13.2%

- Internationally Comparable1

38

19.7%

19.7%

19.4%

Credit risk weighted assets ($B)

39

348.4

349.0

345.3

0%

1%

Total risk weighted assets ($B)

39

432.8

433.3

435.5

0%

-1%

APRA Leverage Ratio

41

5.4%

5.4%

5.3%

Balance Sheet: Key Items
Gross loans and advances ($B)

718.7

710.6

693.7

1%

4%

Net loans and advances ($B)

715.2

707.0

690.1

1%

4%

1,089.7

1,105.6

1,111.2-1%-2%

Customer deposits ($B)

641.1

647.1

648.6

-1%

-1%

Total shareholders' equity ($B)

71.1

70.0

69.6

2%

2%

Balance Sheet: Average Balances
Average gross loans and advances

Mar 24$B
714.0

Mar 23$B
693.5

Mar 24v. Sep 23
2%

Mar 24v. Mar 23
3%

Total assets ($B)

Half Year

Average customer deposits
Average assets2

Sep 23$B
697.1

Movement

663.6

642.0

637.8

3%

4%

1,163.0

1,115.3

1,112.3

4%

5%

Average ordinary shareholders' equity

70.3

68.2

67.1

3%

5%

Average RWA

430.8

433.4

451.9

-1%

-5%

Average credit RWA
Average interest earning assets
Average deposits and other borrowings

347.3

343.6

357.3

1%

-3%

1,015.6

977.2

973.0

4%

4%

859.8

823.5

826.2

4%

4%

As at
Liquidity and Funding
Liquidity Coverage Ratio3

ReferencePage

Net Stable Funding Ratio

Movement

35

Mar 24134%

Sep 23132%

Mar 23
128%

Mar 24v. Sep 23
2%

Mar 24v. Mar 23
6%

36

118%

116%

119%

2%

-1%

As at
Impaired Assets
Gross impaired assets ($M)

Reference
Page
27

Gross impaired assets as a % of gross loans and advances
Net impaired assets ($M)

27

Net impaired assets as a % of shareholders' equity
Individually assessed provision ($M)

25

Individually assessed provision as a % of gross impaired assets
Collectively assessed provision ($M)

25Collectively assessed provision as a % of credit risk weighted assets
Net Tangible Assets
Net tangible assets attributable to ordinary shareholders ($B)4
Net tangible assets per ordinary share ($)
1.

Mar 24
1,518

Sep 23
1,521

Mar 23
1,210

0.21%

0.21%

0.17%

1,193

1,145

789

1.68%

1.64%

1.13%

325

376

421

21.4%

24.7%

34.8%

4,046

4,032

4,040

1.16%

1.16%

1.17%

11

Mar 24v. Sep 23
0%

Mar 24v. Mar 23
25%

4%

51%

-14%

-23%

0%

0%

66.3

65.4

65.0

1%

2%

22.05

21.77

21.65

1%

2%

Refer to page 40 for further details regarding the differences between APRA and Internationally Comparable standards.
Average ordinary shareholders’ equity excludes non-controlling interests.
3. Liquidity Coverage Ratio is calculated on a half year average basis.
4. Equals total shareholders’ equity less total non-controlling interests, goodwill and other intangible assets.
2.

Movement

SUMMARY
Full Time Equivalent Staff
As at 31 March 2024, the Group employed 40,262 staff (Sep 23: 40,342; Mar 23: 39,802) on a full time equivalent (FTE) basis.
As at

Division

Movement

Australia RetailMar 24
11,383

Sep 23
11,313

Mar 23
11,199Mar 24v. Sep 23
1%

Mar 24v. Mar 23
2%-5%

Australia Commercial

3,442

3,514

3,607

-2%

Institutional

6,310

6,366

6,314

-1%

0%

New Zealand

6,754

6,766

6,785

0%

0%

972

1,013

1,037

-4%

-6%

Pacific
Group Centre

11,401

11,37010,8600%5%Total FTE

40,26240,34239,8020%

1%

Average FTE

40,39240,12539,589

1%

2%

As at

Geography
Mar 24
19,335Australia

Sep 23
19,626

Movement
Mar 23
19,575

Mar 24v. Sep 23-1%

Mar 24v. Mar 23-1%

New Zealand

7,185

7,244

7,252

-1%

-1%

Rest of World

13,742

13,472

12,9752%

6%

Total FTE

40,26240,34239,8020%

1%

Other Non-Financial Information
Half Year

Movement

Mar 24

Sep 23

Mar 23

Mar 24v. Sep 23

Mar 24v. Mar 23- high

29.90

25.93

26.08

15%

15%

- low

23.90

22.58

22.39

6%

7%

- closing

29.40

25.66

22.93

15%

28%

Shareholder value - ordinary shares
Share price ($)

Closing market capitalisation of ordinary shares ($B)

88.4

77.1

68.9

15%

28%

Total shareholder returns

19.0%

15.8%

3.6%

large

large

As at Mar 24
ANZBGL credit ratings

ShortTerm

LongTerm

Outlook

Moody's Investors Service

P-1

Aa2

StableS&P Global Ratings

A-1+

AA-

StableF1

A+

StableFitch Ratings

12

GROUP RESULTSCONTENTS

Page

Cash Profit

14

Cash Net Interest Income

15

Cash Other Operating Income

17

Cash Operating Expenses

20

Software Capitalisation

22

Credit Risk

23

Cash Income Tax Expense

29

Impact of Foreign Currency Translation

30

Earnings Related Hedges

32

Cash Earnings Per Share32

Dividends

33

Economic Profit

33

Condensed Balance Sheet

34

Liquidity Risk

35

Funding

36

Capital Management

37

Leverage Ratio

41

Capital Management - Other Developments

42

13

GROUP RESULTS
Non-IFRS Information
Statutory profit is prepared in accordance with the recognition and measurement requirements of Australian Accounting Standards, which comply with
IFRS. The Group provides additional measures of performance in the Results Announcement which are prepared on a basis other than in accordancewith accounting standards. The guidance provided in ASIC Regulatory Guide 230 has been followed when presenting this information.

Cash Profit
Cash profit, a non-IFRS measure, represents the Group’s preferred measure of the result of the core business activities of the Group, enabling readers toassess Group and divisional performance against prior periods and against peer institutions. To calculate cash profit, the Group excludes non-core items
from statutory profit (refer to Definitions on pages 123 to 125 for further details). The adjustments made in arriving at cash profit are included in statutory
profit which is subject to review within the context of the external auditor’s review of the Condensed Consolidated Financial Statements. Cash profit is not
subject to review by the external auditor. The external auditor has informed the Audit Committee that cash profit adjustments have been determined on aconsistent basis across each period presented.
This Group Results section is reported on a cash profit basis unless otherwise stated.

Half Year

Statutory profit attributable to shareholders of the Company

Adjustments between statutory profit and cash profit1
Economic hedges
Revenue and expense hedges
Total adjustments between statutory profit and cash profit
Cash profit
1.

Movement

Mar 24$M
3,407

Sep 23$M
3,551

Mar 23$M
3,555

Mar 24v. Sep 23-4%

Mar 24v. Mar 23
-4%

197

27

190

large

4%

(52)

6

84

large

large

145

33

274

large

-47%

3,552

3,584

3,829

-1%

-7%

Mar 23$M
8,500

Mar 24v. Sep 23-2%

Mar 24v. Mar 23-7%

Refer to pages 65 to 67 for analysis of the adjustments between statutory profit and cash profit.

Half Year

Group performance - cash profit
Mar 24$M
7,899

Net interest income

Sep 23$M
8,074

Movement

Other operating income

2,448

2,291

2,040

7%

20%

Operating income

10,347

10,365

10,5400%-2%Operating expenses(5,215)(5,142)(4,997)

1%

4%

Cash profit before credit impairment and income tax

5,132

5,223

5,543

-2%

-7%

(70)

(112)

(133)

-38%

-47%

Credit impairment (charge)/releaseCash profit before income tax

5,062

5,111

5,410

-1%

-6%

Income tax expense(1,496)(1,513)(1,567)

-1%

-5%

(14)

(14)

(14)

0%

0%

3,552

3,584

3,829

-1%

-7%

Non-controlling interests
Cash profit

Half Year
Mar 24$M794

Cash Profit/(Loss) by division
Australia RetailSep 23$M
874

Movement
Mar 23$M
1,064

Mar 24v. Sep 23-9%

Mar 24v. Mar 23
-25%

665

701

739

-5%

-10%

Institutional

1,522

1,360

1,589

12%

-4%

New Zealand

791

775

771

2%

3%

Pacific

31

37

34

-16%

-9%

Australia Commercial

Group Centre

(251)

(163)

(368)

54%

-32%

Cash profit

3,552

3,584

3,829

-1%

-7%

14

GROUP RESULTS
Cash Net Interest Income
Half Year
Mar 24
$M
7,899

Group
Net interest income1
Average interest earning assets
Average deposits and other borrowings
Net interest margin (%)
Group (excluding Markets business unit)
Net interest income

Sep 23$M
8,074

Movement
Mar 23$M
8,500

Mar 24v. Sep 23-2%

Mar 24v. Mar 23-7%

1,015,621

977,175

972,9724%

4%859,764

823,466

826,160

4%

4%

1.56

1.65

1.75

-9 bps-19 bps

7,963

8,054

8,336

-1%

-4%

Average interest earning assets

684,626

683,888

687,563

0%0%

Average deposits and other borrowings

650,098

627,170

628,973

4%

3%

2.33

2.35

2.43

-2 bps-10 bps

Net interest margin (%)

Half Year
Mar 24$M

Net interest margin by major division1
Australia Retail
Net interest margin (%) - cash

Sep 23$M

Movement
Mar 23$M

Mar 24v. Sep 23

Mar 24v. Mar 23-44 bps

1.94

2.06

2.38

-12 bps

Average interest earning assets

269,406

260,946

253,743

3%

6%

Average deposits and other borrowings

168,912

159,786

152,392

6%

11%

2.60

2.67

2.72

-7 bps-12 bpsAustralia Commercial2
Net interest margin (%) - cash
Average interest earning assets

63,623

61,39860,860

4%

5%

Average deposits and other borrowings

115,357

112,368

113,276

3%

2%

Institutional (excluding Markets business unit)
Net interest margin (%) - cash3

2.39

2.36

2.26

3 bps

13 bpsAverage interest earning assets

162,856

164,845

168,925-1%-4%

Average deposits and other borrowings

159,851

159,295

158,7180%

1%-11 bps

New Zealand
Net interest margin (%) - cash

1.
2.

3.

2.56

2.60

2.67

-4 bpsAverage interest earning assets

122,613120,377

118,639

2%

3%

Average deposits and other borrowings

106,417

102,479

102,1134%

4%Includes the major bank levy of -$192 million for the March 2024 half (Sep 23 half: -$178 million; Mar 23 half: -$175 million).
Australia Commercial division generates positive net interest income from surplus deposits held. Accordingly, $58.1 billion of average deposits for the March 2024 half
(Sep 23 half: $57.6 billion; Mar 23 half: $59.3 billion) have been included within average net interest earning assets for the net interest margin calculation to align with the internalmanagement reporting view.
Net interest margin for the Institutional division including Markets business unit was 0.76% for the March 2024 half (Sep 23 half: 0.86%; Mar 23 half: 0.91%).

Group net interest margin - March 2024 Half Year v March 2023 Half Year•

March 2024 v March 2023
Net interest margin (-19 bps)•

Assets pricing (-11 bps): driven by pricing competition in the Australia Retail, Australia Commercial and New Zealand divisions.

•

Deposits pricing (+1 bps): driven by favourable deposit margins, partially offset by lower margin on term deposits.

15

GROUP RESULTS•

Assets and funding mix (-2 bps): driven by unfavourable deposit mix with a shift towards lower margin term deposits, and increased termwholesale funding relative to customer deposits. This was partially offset by favourable asset mix in the Australia Retail division, and favourable
divisional mix primarily driven by higher contribution by the Australia Commercial division.

•

Capital and replicating portfolio (+6 bps): driven by higher interest rates, partially offset by lower volumes.

•

Wholesale funding (-2 bps): driven by higher wholesale funding rates including the impact of partial maturity of the Term Funding Facility (TFF).

•

Markets activities (-11 bps): lower net interest income was driven by higher funding costs, primarily on commodity assets where the related
revenues are recognised as Other operating income, and higher liquid assets held in Markets.

Average interest earning assets
Average interest earning assets increased $42.6 billion (4%) driven by:•

Average trading assets and investment securities increased $26.6 billion (21%) driven by higher liquid assets and the impact of foreign currencytranslation.

•

Average net loans and advances increased $14.7 billion (2%) driven by lending growth across the Australia Retail, Australia Commercial, and
New Zealand divisions and the impact of foreign currency translation. This was partially offset by a decrease in the Institutional division.

•

Average cash and other liquid assets increased $1.3 billion (1%) driven by higher reverse repurchase agreements and higher settlementbalances owed to ANZ, partially offset by lower central bank balances.

Average deposits and other borrowings•

Average deposits and other borrowings increased $33.6 billion (4%) driven by higher term deposits, certificates of deposit, commercial paper,and the impact of foreign currency translation. This was partially offset by lower at-call deposits.

Group net interest margin - March 2024 Half Year v September 2023 Half Year•

March 2024 v September 2023
Net interest margin (-9 bps)•

Assets pricing (-4 bps): driven by pricing competition in the Australia Retail and Australia Commercial divisions.

•

Deposits pricing (0 bps): driven by favourable at-call deposit margins, offset by lower margin on term deposits.

•

Assets and funding mix (0 bps): driven by unfavourable deposit mix with a shift towards lower margin term deposits, offset by favourable asset
mix in the Australia Retail division, and favourable divisional mix primarily driven by higher contribution by the Australia Commercial division.

•

Capital and replicating portfolio (+3 bps): driven by higher interest rates, partially offset by lower volumes.

•

Wholesale funding (-1 bps): driven by higher wholesale funding rates including the impact of partial maturity of the TFF.

•

Markets activities (-7 bps): lower net interest income was driven by higher funding costs, primarily on commodity assets where the related
revenues are recognised as Other operating income, and higher liquid assets held in Markets.

Average interest earning assets
Average interest earning assets increased $38.4 billion (4%) driven by:•

Average trading assets and investment securities increased $25.6 billion (20%) driven by higher Markets activities and the impact of foreign
currency translation.

•

Average net loans and advances increased $13.8 billion (2%) driven by lending growth across the Australia Retail, Australia Commercial, and
New Zealand divisions and the impact of foreign currency translation.

•

Average cash and other liquid assets decreased $0.9 billion driven by lower central bank balances, partially offset by higher reverse repurchaseagreements, and higher settlement balances owed to ANZ.

Average deposits and other borrowings•

Average deposits and other borrowings increased $36.3 billion (4%) driven by growth in term deposits, at-call deposits, commercial paper, andthe impact of foreign currency translation.

16

GROUP RESULTS
Cash Other Operating Income
Half Year

Movement

Net fee and commission income1

Mar 24$M919

Sep 23$M972

Mar 23$M890

Mar 24v. Sep 23-5%

Mar 24v. Mar 23
3%

Markets other operating income

1,276

938

985

36%

30%

Share of associates' profit/(loss)

84

120

101

-30%

-17%

Other1

169

261

64

-35%

large

Total

2,448

2,291

2,040

7%

20%

Half Year

Movement

Mar 24$M

Sep 23$M

Mar 23$M

Mar 24v. Sep 23

Australia Retail

301

374

296

-20%

2%

Australia Commercial

169

190

175

-11%

-3%

Institutional

1,687

1,321

1,373

28%

23%

Other operating income by division

Mar 24v. Mar 23

New Zealand

208

210

199

-1%

5%

Pacific

44

45

40

-2%

10%

Group Centre

39

151

(43)

-74%

large

2,448

2,291

2,040

7%

20%

Total

Half YearNet interest income2

Mar 24$M(64)

Sep 23$M
20

Other operating income2

1,276

Total

1,212

Markets income

1.
2.

Movement
Mar 23$M
164

Mar 24v. Sep 23
large

Mar 24v. Mar 23
large

938

985

36%

30%

958

1,149

27%

5%

Excluding the Markets business unit.
Net interest income included funding costs in the Franchise trading book, primarily on commodity assets, where the related revenue is recognised as Other operating income.

17

GROUP RESULTS
Other operating income - March 2024 Half Year v March 2023 Half Year•

March 2024 v March 2023
Other operating income increased $408 million (20%).
Net fee and commission income
Net fee and commission income increased $29 million (3%) driven by:•$16 million increase in the Institutional division (excluding Markets) driven by higher transaction activity in Corporate Finance.

•$12 million increase in the Australia Retail division driven by higher cards revenue.

•$10 million increase in the Group Centre division driven by higher Cashrewards revenue.

•$16 million decrease in the Australia Commercial division driven by a decrease in non-lending fees.

Markets income
Markets income increased $63 million (5%) with a $291 million increase in Other operating income, partially offset by a $228 million decrease in Net
interest income. The decrease in Net interest income was driven by higher funding costs in the Franchise trading book, primarily on commodity
assets, where the related customer revenues are recognised as Other operating income. The net $63 million increase was attributable to thefollowing business activities:•$112 million increase in Franchise Revenue was driven by Rates, Commodities, and Credit and Capital Markets, partially offset by Foreign
Exchange. Rates revenue increased due to higher customer demand for hedging and financing solutions, and trading gains amid lower interest
rate volatility. Commodities revenue increased due to more favourable trading conditions and sustained customer demand for hedging solutions,notably precious metals. Credit and Capital Markets revenue increased due to increased customer issuance activity in a more stableenvironment, and credit spreads generally tightened resulting in trading gains. This was partially offset by a decrease in Foreign Exchange
revenue as moderating volatility and less directional trends in key currency pairs than the March 2023 half resulted in reduced customer demandand lower trading gains.

•$23 million increase in Derivative Valuation Adjustments from gains (net of hedges) from tightening credit and funding spreads, and lower
currency and interest rate volatility.

•$72 million decrease in Balance Sheet arising from lower net interest income from fewer short-term interest rate increases than the March 2023
half.

Share of associates’ profit/(loss)•

Share of associates’ profit/(loss) decreased $17 million (17%) driven by a decrease in P.T. Bank Pan Indonesia (PT Panin) ($25 million), partially
offset by increases in Worldline Australia Pty Ltd (Worldline) and AMMB Holdings Berhad (AmBank).

Other
Oher income increased $105 million driven by:•$89 million increase in the Group Centre division driven by:- $49 million increase from unfavourable valuation adjustments in the March 2023 half from investments measured at fair value through profit orloss,- $43 million increase from a loss on disposal of data centres in Australia in the March 2023 half,- $20 million increase from a gain on recycling of foreign currency translation reserves (FCTR) from other comprehensive income to profit orloss on dissolution of a number of international entities, and- $21 million decrease from a loss on partial disposal of investment in AmBank ($21 million).

•$10 million increase in the Australia Commercial division driven by higher income for services provided to Worldline.

18

GROUP RESULTS•

March 2024 v September 2023
Other operating income increased $157 million (7%).
Net fee and commission income
Net fee and commission income decreased $53 million (5%) driven by:•$64 million decrease in the Australia Retail division driven by lower cards revenue due to timing of recognition of cards incentives and seasonalityof fees.

•$14 million decrease in the Australia Commercial division driven by a decrease in non-lending fees.

•$18 million increase in the Institutional division (excluding Markets) driven by higher transaction activity in Corporate Finance.

Markets income
Markets income increased $254 million (27%) with a $338 million increase in Other operating income, partially offset by an $84 million decrease in
Net interest income. The decrease in Net interest income was driven by higher funding costs in the Franchise trading book, primarily on commodity
assets, where the related customer revenues are recognised as Other operating income. The net $254 million increase was attributable to thefollowing business activities:•$199 million increase in Franchise Revenue across all business lines. Commodities revenue increased due to more favourable trading conditions
and increased customer demand for hedging solutions, notably in precious metals. Credit and Capital Markets revenue increased due to higher
customer issuance activity in a more stable environment, and credit spreads tightening over the half resulted in trading gains. Rates revenue
increased due to higher customer demand for both hedging and financing solutions, and trading gains amid lower rates volatility. Foreign
Exchange revenues increased amid favourable trading conditions, though moderating volatility and less directional trends in key currency pairs
resulted in lower customer demand for hedging in certain geographies.

•$41 million increase in Derivative Valuation Adjustments from gains (net of hedges) from tightening credit and funding spreads, and lower
currency and interest rate volatility.

•$14 million increase in Balance Sheet primarily driven by higher investment securities volumes.

Share of associates’ profit/(loss)•

Share of associates’ profit/(loss) decreased $36 million (30%) driven by decreases in PT Panin ($36 million) and Worldline, partially offset by anincrease in AmBank.

Other
Other income decreased $92 million (35%) driven by:•$76 million decrease in the Group Centre division driven by:- $23 million decrease from a favourable adjustment to the gain on sale relating to the completed UDC Finance divestment in the September
2023 half,- $23 million decrease from the lower gain from recycling of FCTR from other comprehensive income to profit or loss on dissolution of a numberof international entities, and- $21 million decrease from a loss on partial disposal of investment in AmBank.

•$7 million decrease in Australia Commercial division driven by a gain on sale of Investment Lending business in the September 2023 half.

19

GROUP RESULTS
Cash Operating Expenses
Half Year

Personnel

Mar 24$M
3,062

Sep 23$M
2,869

Movement
Mar 23$M
2,893

Mar 24v. Sep 23
7%

Mar 24v. Mar 23
6%

Premises

321

324

334

-1%

-4%

Technology

898

864

836

4%

7%

Restructuring

141

115

54

23%

large

Other

793

970

880

-18%

-10%

Total

5,215

5,142

4,997

1%

4%

Half Year
Mar 24$M
1,735

Operating expenses by division
Australia RetailSep 23$M
1,758

Movement
Mar 23$M
1,703

Mar 24v. Sep 23-1%

Mar 24v. Mar 23
2%

763

738

685

3%

11%

Institutional

1,444

1,388

1,340

4%

8%

New Zealand

677

665

634

2%

7%

Pacific

70

71

74

-1%

-5%

Group Centre

526

522

561

1%

-6%

5,215

5,142

4,997

1%

4%

Australia Commercial

Total

Half Year

Movement

FTE by division
Australia RetailMar 24
11,383

Sep 23
11,313

Mar 23
11,199Mar 24v. Sep 23
1%

Mar 24v. Mar 23
2%

Australia Commercial

3,442

3,514

3,607

-2%

-5%

Institutional

6,310

6,366

6,314

-1%

0%

New Zealand

6,754

6,766

6,785

0%

0%

972

1,013

1,037

-4%

-6%

Pacific
Group Centre

11,401

11,37010,8600%5%Total FTE

40,26240,34239,8020%

1%

Average FTE

40,39240,12539,5891%

2%

20

GROUP RESULTS
Operating expenses - March 2024 Half Year v March 2023 Half Year•

March 2024 v March 2023
Operating expenses increased $218 million (4%).

••

Personnel expenses increased $169 million (6%) driven by inflationary impacts on wages and higher resourcing associated with strategic
initiatives. This was partially offset by productivity and a decrease in employee leave provisions.

•Technology expenses increased $62 million (7%) driven by higher software licence costs, and inflationary impacts on vendor costs, partially
offset by benefits from technology simplification.

•

Restructuring expenses increased $87 million driven by operational changes across all divisions.

•

Other expenses decreased $87 million (10%) driven by benefits from productivity initiatives.

March 2024 v September 2023
Operating expenses increased $73 million (1%).
•

Personnel expenses increased $193 million (7%) driven by inflationary impacts on wages including an increase in employee leave provisions,partially offset by productivity initiatives.

•

Technology expenses increased $34 million (4%) driven by higher software licence costs, and inflationary impacts on vendor costs, partially
offset by benefits from technology simplification.

•

Restructuring expenses increased $26 million (23%) driven by operational changes across all divisions.

•

Other expenses decreased $177 million (18%) driven by benefits from productivity initiatives, Compensation Scheme of Last Resort levy incurredin the September 2023 half and seasonal factors.

21

GROUP RESULTS
Software Capitalisation
Capitalised software comprises both costs incurred to develop software and costs to acquire software. These costs are capitalised as intangible assets
and amortised over the expected useful lives. Details are presented in the table below:
Half Year
Mar 24$M919

Balance at start of period

Sep 23$M
877

Movement
Mar 23$M896

Mar 24v. Sep 23
5%

Mar 24v. Mar 23
3%

Software capitalised during the period

146

199

143

-27%

2%

Amortisation during the period

(151)

(157)

(163)

-4%

-7%

Software impaired/written-off

(9)

-

-

n/a

n/a

Foreign currency translation

-

-

1

n/a

large

Total capitalised software

905

919

877

-2%

3%

Capitalised software by division

As at
Mar 24$M
117

Sep 23$M
125

Australia Commercial

113

104

Institutional

453

433

New Zealand13

35Group Centre

209

Total capitalised software

905

Australia Retail

22

Movement
Mar 23$M132

Mar 24v. Sep 23-6%

Mar 24v. Mar 23
-11%

86

9%

31%

415

5%

9%

14

-63%

-7%

222

230

-6%

-9%

919

877

-2%

3%

GROUP RESULTS
Credit Risk
The Group’s assessment of expected credit losses (ECL) from its credit portfolio is subject to judgements and estimates made by management based ona variety of internal and external information, as well as the Group’s experience of the performance of the portfolio under a variety of conditions. Refer toNote 1 of the Condensed Consolidated Financial Statements for further information.

Credit impairment charge/(release)
Half Year

Movement

Collectively assessed credit impairment charge/(release)

Mar 24$M
32

Sep 23$M(11)

Mar 23$M
163

Mar 24v. Sep 23
large

Mar 24v. Mar 23-80%

Individually assessed credit impairment charge/(release)

38

123

(30)

-69%

large

Total credit impairment charge/(release)

70

112

133

-38%

-47%

Credit impairment charge/(release) analysis
Half Year
Mar 24$M

Movement

Sep 23$M

Mar 23$M

Mar 24v. Sep 23

Mar 24v. Mar 23

New and increased provisions (net of releases)- Collectively assessed

32

(11)

163

large

-80%

- Individually assessed

201

239

237

-16%

-15%

Write-backs

(85)

(50)

(166)

70%

-49%

Recoveries of amounts previously written-off

(78)

(66)

(101)

18%

-23%

Total credit impairment charge/(release)

70

112

133

-38%

-47%

Credit impairment charge/(release) by division
Half Year
Collectively assessed

Movement

Mar 24$M

Sep 23$M

Mar 23$M

Mar 24v. Sep 23

Mar 24v. Mar 23

(6)

5

50

large

large
-84%

Australia Retail
Australia Commercial

9

8

57

13%

Institutional

43

(36)

5

large

large

New Zealand

(10)

20

66

large

large

Pacific

(4)

(7)

(15)

-43%

-73%

Group Centre

-

(1)

-

large

n/a

Total collectively assessed

32

(11)

163

large

-80%

Individually assessed
Australia Retail

49

48

32

2%

53%

Australia Commercial

26

33

9

-21%

large

Institutional

(49)

30

(79)

large

-38%

New Zealand

14

17

9

-18%

56%

Pacific

(2)

(5)

(1)

-60%

large

Total individually assessed

38

123

(30)

-69%

large

Australia Retail

43

53

82

-19%

-48%

Australia Commercial

35

41

66

-15%

-47%

Institutional

(6)

(6)

(74)

0%

-92%

Total credit impairment charge/(release)

New Zealand

4

37

75

-89%

-95%

Pacific

(6)

(12)

(16)

-50%

-63%

Group Centre
Total credit impairment charge/(release)

23

-

(1)

-

large

n/a

70

112

133

-38%

-47%

GROUP RESULTS
Credit impairment charge/(release) by division, cont'dCollectively assessed

Individually assessedStage 3 Recoveries
and writebacks
$M

Total
$M

Total
$M

49

43

Stage 1
$M

Stage 2
$M

Stage 3
$M

Total
$M

Stage 3 New andincreased$M

Australia Retail

13

(42)

23

(6)

91

(42)

Australia Commercial

March 2024 Half Year

10

(9)

8

9

58

(32)

26

35

Institutional

-

9

34

43

21

(70)

(49)

(6)

New Zealand

11

(30)

9

(10)

30

(16)

14

4

Pacific

2

(2)

(4)

(4)

1

(3)

(2)

(6)

Group Centre

-

-

-

-

-

-

-

-

36

(74)

70

32

201

(163)

38

70

Total
September 2023 Half Year
Australia Retail

12

13

(20)

5

98

(50)

48

53

Australia Commercial

59

(54)

3

8

65

(32)

33

41

Institutional

36

(63)

(9)

(36)

42

(12)

30

(6)

New Zealand

(1)

18

3

20

32

(15)

17

37

Pacific

5

(5)

(7)

(7)

2

(7)

(5)

(12)

Group Centre

(1)

-

-

(1)

-

-

-

(1)

110

(91)

(30)

(11)

239

(116)

123

112

Australia Retail

(39)

78

11

50

94

(62)

32

82

Australia Commercial

(2)

75

(16)

57

62

(53)

9

66

Institutional

43

(31)

(7)

5

57

(136)

(79)

(74)

New Zealand

(2)

58

10

66

21

(12)

9

75

Pacific

(1)

(8)

(6)

(15)

3

(4)

(1)

(16)

Group Centre

-

-

-

-

-

-

-

-

Total

(1)

172

(8)

163

237

(267)

(30)

133

Total
March 2023 Half Year

Collectively assessed credit impairment charge/(release)•

March 2024 v March 2023
The collectively assessed impairment charge of $32 million for the March 2024 half was driven by deterioration in the credit risk profile across all
divisions, deterioration in economic outlook and portfolio growth, partially offset by reduction in management temporary adjustments as anticipatedrisks are now represented in portfolio credit profiles.
The collectively assessed impairment charge of $163 million for the March 2023 half was driven by deterioration in economic outlook, a net increasein management temporary adjustments, and deterioration in credit risk. This was partially offset by an improvement in portfolio composition,
particularly in the Institutional division.

•

March 2024 v September 2023
The collectively assessed impairment charge of $32 million for the March 2024 half was driven by deterioration in the credit risk profile across all
divisions, deterioration in economic outlook and portfolio growth, partially offset by reduction in management temporary adjustments as anticipatedrisks are now represented in portfolio credit profiles.
The collectively assessed impairment release of $11 million for the September 2023 half was driven by a net reduction in management temporary
adjustments, and an improvement in portfolio composition, particularly in the Institutional division. This was partially offset by deterioration ineconomic outlook, and deterioration in credit risk.

Individually assessed credit impairment charge/(release)•

March 2024 v March 2023
The individually assessed credit impairment charge increased $68 million driven by increases in the Institutional division due to a large number ofwrite-backs in the March 2023 half partially offset by lower impairments ($30 million), the Australia Retail division due to lower write-backs in thehome loan portfolio and lower recoveries in the unsecured portfolios ($17 million), and the Australia Commercial division due to lower write-backs in
the SME Banking portfolio ($17 million).

•

March 2024 v September 2023
The individually assessed credit impairment charge decreased $85 million (69%) driven by the Institutional division due to lower impairments andhigher write-backs and recoveries ($79 million), and the Australia Commercial and New Zealand divisions due to lower impairments ($10 million).

24

GROUP RESULTS
Allowance for expected credit losses1
As at
Mar 24$M
4,046

Collectively assessed allowance for ECL

Movement

Sep 23$M
4,032

Mar 23$M
4,040

Mar 24v. Sep 23
0%

Mar 24v. Mar 23
0%

325

376

421

-14%

-23%

Total allowance for ECL

4,371

4,408

4,461

-1%

-2%

Net loans and advances at amortised cost

3,489

3,546

3,658

-2%

-5%

Off-balance sheet commitments - undrawn and contingent

849

827

774

3%

10%

Investment securities - debt securities at amortised cost

33

35

29

-6%

14%

4,371

4,408

4,461

-1%

-2%

Mar 23$M

Mar 24v. Sep 23

Individually assessed allowance for ECL

Total allowance for ECL

Allowance for expected credit losses by division1
As at
Mar 24$M

Collectively assessed
Australia Retail

Movement

Sep 23$M

Mar 24v. Mar 23

948

954

949

-1%

0%

Australia Commercial

1,050

1,041

1,033

1%

2%

Institutional

1,458

1,425

1,451

2%

0%

New Zealand

542

560

543

-3%

0%

Pacific

48

52

63

-8%

-24%

Group Centre
Total collectively assessed

-

-

1

n/a

large

4,046

4,032

4,040

0%

0%

Individually assessed
Australia Retail

61

63

68

-3%

-10%

Australia Commercial

121

127

149

-5%

-19%

Institutional

88

126

129

-30%

-32%

New Zealand

38

40

47

-5%

-19%

Pacific

17

20

28

-15%

-39%

-

-

-

n/a

n/a

325

376

421

-14%

-23%

Group Centre
Total individually assessed

Allowance for ECL
Australia Retail

1,009

1,017

1,017

-1%

-1%

Australia Commercial

1,171

1,168

1,182

0%

-1%

Institutional

1,546

1,551

1,580

0%

-2%

New Zealand

580

600

590

-3%

-2%

Pacific

65

72

91

-10%

-29%

-

-

1

n/a

large

4,371

4,408

4,461

-1%

-2%

Group Centre
Total allowance for ECL
1.

Includes allowance for ECL for Net loans and advances - at amortised cost, Investment securities - debt securities at amortised cost and Off-balance sheet commitments - undrawn andcontingent facilities. For Investment securities - debt securities at FVOCI, the allowance for ECL is recognised in Other comprehensive income with a corresponding charge to profit or loss.

25

GROUP RESULTS
Allowance for expected credit losses by division, cont'd1
Individuallyassessed

Collectively assessedStage 1
$M

Stage 2
$M

Stage 3
$M

Stage 3
$M

Total
$M

Australia Retail

131

631

186

Australia Commercial

420

522

108

948

61

1,009

1,050

121

Institutional

1,197

218

43

1,171

1,458

88

1,546

New Zealand

148

315

Pacific

22

19

79

542

38

580

7

48

17

-

65

-

-

-

-

-

1,918

1,705

423

4,046

325

4,371

Australia Retail

118

674

162

954

63

1,017

Australia Commercial

410

531

100

1,041

127

1,168

Institutional

1,205

210

10

1,425

126

1,551

New Zealand

139

351

70

560

40

600

Pacific

20

20

12

52

20

72

-

-

-

-

-

-

1,892

1,786

354

4,032

376

4,408

107

660

182

949

68

1,017

As at March 2024

Group Centre
Total

Total
$M

As at September 2023

Group Centre
Total

As at March 2023
Australia Retail
Australia Commercial

350

586

97

1,033

149

1,182

Institutional

1,159

274

18

1,451

129

1,580

New Zealand

141

333

69

543

47

590

Pacific

16

28

19

63

28

91

Group Centre

1

-

-

1

-

1

1,774

1,881

385

4,040

421

4,461

Total
1.

Includes allowance for ECL for Net loans and advances - at amortised cost, Investment securities - debt securities at amortised cost and Off-balance sheet commitments - undrawn andcontingent facilities. For Investment securities – debt securities at FVOCI, the allowance for ECL is recognised in Other comprehensive income with a corresponding charge to profit or loss.

Allowance for expected credit losses•

March 2024 v March 2023
Total allowance for ECL decreased $90 million (2%) driven by a $96 million decrease in the individually assessed allowance for ECL, partially offset
by a $6 million increase in the collectively assessed allowance for ECL. The decrease in individually assessed allowance for ECL was driven by
decreases across all divisions as new provisions remained low, and continued write-back and recovery activity. The increase in collectively assessed
allowance for ECL was driven by $199 million from deterioration in credit risk profile across all divisions, $76 million from deterioration in economic
outlook particularly in the September 2023 half, and $35 million from portfolio growth. This was partially offset by a $289 million reduction in
management temporary adjustments, as anticipated risks are now represented in portfolio credit profiles, and $15 million reduction from foreign
currency translation and other impacts.

•

March 2024 v September 2023
Total allowance for ECL decreased $37 million (1%) driven by a $51 million decrease in the individually assessed allowance for ECL, partially offset
by a $14 million increase in the collectively assessed allowance for ECL. The decrease in individually assessed allowance for ECL waspredominantly driven by the Institutional division as new provisions remained low, and continued write-back and recovery activity. The increase incollectively assessed allowance for ECL was driven by $169 million from deterioration in credit risk, $63 million from portfolio growth, and $5 million
from deterioration in economic outlook. This was partially offset by a $205 million reduction in management temporary adjustments, as anticipatedrisks are now represented in portfolio credit profiles, and $18 million from foreign currency translation and other impacts.

26

GROUP RESULTS
Long-Run Loss Rates
Management believes that disclosure of modelled long-run historical loss rates for individually assessed provisions assists in assessing the longer term
expected loss rates of the lending portfolio by removing the volatility of reported earnings created by the use of accounting losses. The long-run loss
methodology used for economic profit is an internal measure and is not based on the credit loss recognition principles of AASB 9 Financial Instruments.
As at
Long-run loss as a % of gross lending assets by division

Mar 24

Sep 23

Mar 23Australia Retail

0.09%

0.10%

0.11%

Australia Commercial

0.53%

0.52%

0.53%

New Zealand

0.13%

0.12%

0.10%

Institutional

0.21%

0.19%

0.19%

Total Group

0.18%

0.17%

0.17%

Non-Performing Credit Exposures
As at

Movement

Mar 24$M880

Sep 23$M
1,037

Mar 23$M804

Mar 24v. Sep 23-15%

Restructured items2

589

437

382

35%

54%

Non-performing commitments, contingencies and derivatives1

49

47

24

4%

large

1,518

1,521

1,210

0%

25%

4,495

3,500

3,089

28%

46%

6,013

5,021

4,299

20%

40%

61%

Impaired loans1

Gross impaired assets
Non-performing credit exposures not impaired

1

Total non-performing credit exposures3

Mar 24v. Mar 23
9%Gross impaired assets by division
Australia Retail

669

520

415

29%

Australia Commercial

261

248

288

5%

-9%

Institutional

437

562

302

-22%

45%

New Zealand

119

122

100

-2%

19%

Pacific

32

69

105

-54%

-70%

1,518

1,521

1,210

0%

25%

1,095

999

956

10%

15%

262

113

123

large

large

Gross impaired assets
Gross impaired assets by size of exposure
Less than $10 million$10 million to $100 million
Greater than $100 million

161

409

131

-61%

23%

Gross impaired assets

1,518

1,521

1,210

0%

25%

(320)

(366)

(414)

-13%

-23%

(5)

(10)

(7)

-50%

-29%

1,193

1,145

789

4%

51%

Individually assessed provisions
Impaired loans
Non-performing commitments, contingencies and derivatives
Net impaired assets
1.

Impaired loans and non-performing commitments, contingencies and derivatives do not include exposures that are collectively assessed for Stage 3 ECL, which comprise unsecured retail
exposures of 90+ days past due and defaulted but well secured wholesale and retail exposures. These collectively assessed exposures are included in Non-performing credit exposures not
impaired.
2. Restructured items are facilities where the original contractual terms have been modified for reasons related to the financial difficulties of the customer and are collectively assessed forStage 3 ECL. Restructuring may consist of reduction of interest, principal or other payments legally due, or an extension in maturity materially beyond those typically offered to new facilities
with similar risk.
3. Non-performing credit exposures are aligned with the definition in APS220 Credit Risk Management.

•

March 2024 v March 2023
Gross impaired assets increased $308 million (25%) driven by increases in the Australia Retail division due to increase in restructured home loan
facilities ($254 million), and the Institutional division due to the downgrade of several single name collateralised exposures in the September 2023
half ($135 million). This was partially offset by decreases in the Pacific division due to upgrade of restructured exposures ($73 million), and theAustralia Commercial division due to low impairments in the current period ($27 million).
Non-performing credit exposures not impaired increased $1,406 million (46%) driven by defaults on well secured mortgages in the Australia Retailand New Zealand divisions where 90+ days past due delinquency rates have increased, and several large fully secured exposures in the Institutional
division downgraded to defaulted.

27

GROUP RESULTS•

March 2024 v September 2023
Gross impaired assets decreased $3 million driven by decreases in the Institutional division due to a customer upgrade and limit reduction on several
customers ($125 million), and the Pacific division due to upgrade of restructured exposures ($37 million). This was offset by increases in theAustralia Retail division due to increase in restructured home loan facilities ($149 million), and the Australia Commercial division due to downgradesin the SME Banking portfolio ($13 million).
Non-performing credit exposures not impaired increased $995 million (28%) driven by defaults on well secured mortgages in the Australia Retail and
New Zealand divisions where 90+ days past due delinquency rates have increased, and several large fully secured exposures in the Institutional
division downgraded to defaulted.

The Group’s individually assessed provision coverage ratio on impaired assets was 21.4% at 31 March 2024 (Sep 23: 24.7%; Mar 23: 34.8%).

New Impaired Assets
Half Year

Movement

Mar 24$M359

Sep 23$M
627

Mar 23
$M
405

269

162

122

66%

large

2

40

11

-95%

-82%

Total new impaired assets

630

829

538

-24%

17%

New impaired assets by division
Australia Retail

323

276

221

17%

46%

Australia Commercial

122

93

93

31%

31%

Institutional

98

369

156

-73%

-37%

New Zealand

84

85

63

-1%

33%

Pacific

3

6

5

-50%

-40%

630

829

538

-24%

17%

Impaired loans1
Restructured items2
Non-performing commitments and contingencies1

Total new impaired assets
1.

2.

•

Mar 24v. Sep 23-43%

Mar 24v. Mar 23-11%

Impaired loans and non-performing commitments and contingencies do not include exposures that are collectively assessed for Stage 3 ECL, which comprise unsecured retail exposures of90+ days past due and defaulted but well secured exposures.
Restructured items are facilities where the original contractual terms have been modified for reasons related to the financial difficulties of the customer and are collectively assessed forStage 3 ECL. Restructuring may consist of reduction of interest, principal or other payments legally due, or an extension in maturity materially beyond those typically offered to new facilities
with similar risk.

March 2024 v March 2023
New impaired assets increased $92 million (17%) driven by increases in the Australia Retail division due to increase in restructured home loan
facilities ($102 million), the Australia Commercial division due to increase in the SME Banking portfolio and well collateralised Agri exposures($29 million), and the New Zealand division due to increases across all portfolios ($21 million). This was partially offset by the Institutional division
with a lower number of downgrades occurring in the current period ($58 million).

•

March 2024 v September 2023
New impaired assets decreased $198 million (24%) driven by decreases in the Institutional division due to the downgrade of several single namecollateralised exposures in the September 2023 half ($271 million). This was partially offset by increases in the Australia Retail division due toincrease in restructured home loan facilities ($47 million), and the Australia Commercial division due to increase in the SME Banking portfolio andwell collateralised Agri exposures ($29 million).

Ageing analysis of net loans and advances that are past due but not impaired
As at

Movement

1-29 days

Mar 24$M
6,927

Sep 23$M
7,223

Mar 23$M
6,213

Mar 24v. Sep 23-4%

Mar 24v. Mar 23
11%30-59 days

2,337

1,809

1,965

29%

19%

60-89 days

1,234

1,146

759

8%

63%

90+ days

3,490

2,841

2,502

23%

39%

Total

13,98813,01911,4397%

22%•

March 2024 v March 2023
Net loans and advances past due but not impaired increased $2,549 million (22%) with increases across all ageing categories driven by home loan
portfolios in the Australia Retail and New Zealand divisions.

•

March 2024 v September 2023
Net loans and advances past due but not impaired increased $969 million (7%) with increases across the 30+ days ageing categories driven byhome loan portfolios in the Australia Retail and New Zealand divisions.

28

GROUP RESULTS
Cash Income Tax Expense
Half Year

Movement

Income tax expense from cash profit

Mar 24$M
1,496

Sep 23$M
1,513

Mar 23$M
1,567

Effective tax rate

29.6%

29.6%

29.0%

•

Mar 24v. Sep 23-1%

Mar 24v. Mar 23-5%

March 2024 v March 2023
The effective tax rate increased from 29.0% to 29.6%. The increase of 60 bps was driven by higher non-deductible interest on convertible
instruments (56 bps), higher prior period adjustments (20 bps), lower equity accounted earnings (8 bps), and higher withholding tax expense on
foreign dividends (8 bps). This was partially offset by various other small items (32 bps).

•

March 2024 v September 2023
The effective tax rate remained flat at 29.6%. The increase from higher non-deductible interest on convertible instruments (21 bps), lower equity
accounted earnings (19 bps), and higher prior period adjustments (16 bps), was offset by higher offshore earnings that attract a lower rate of tax(41 bps), and various other small items (15 bps).

29

GROUP RESULTS
Impact of Foreign Currency Translation
The following tables present the Group’s comparative cash profit results, net loans and advances and customer deposits neutralised for the impact offoreign currency translation. Comparative data has been adjusted to remove the translation impact of foreign currency movements by retranslating priorperiod comparatives at current period foreign exchange rates.
March 2024 Half Year v March 2023 Half Year
Half YearNet interest income

Movement

ActualFX
unadjusted

FX
impactFX
adjusted

FX
unadjusted

FX
adjustedMar 24$M
7,899

Mar 23$M
8,500

Mar 23$M
37

Mar 23$M
8,537

Mar 24v. Mar 23-7%

Mar 24v. Mar 23-7%

Other operating income

2,448

2,040

(36)

2,004

20%

22%

Operating income

10,347

10,5401

10,541-2%-2%

Operating expenses(5,215)(4,997)(19)(5,016)

4%

4%

Cash profit before credit impairment and income tax

5,132

5,543

(18)

5,525

-7%

-7%

Credit impairment (charge)/release

(70)

(133)

(3)

(136)

-47%

-49%

Cash profit before income tax

5,062

5,410

(21)

5,389

-6%

-6%

Income tax expense(1,496)(1,567)

7(1,560)

-5%

-4%

(14)

(14)

-

(14)

0%

0%

3,552

3,829

(14)

3,815

-7%

-7%

794

1,064

-

1,064

-25%

-25%

Non-controlling interests
Cash profit

Cash profit/(loss) by division
Australia Retail
Australia Commercial

665

739

-

739

-10%

-10%

Institutional

1,522

1,589

8

1,597

-4%

-5%

New Zealand

791

771

9

780

3%

1%

Pacific

31

34

-

34

-9%

-9%

Group Centre

(251)

(368)

(31)

(399)

-32%

-37%

Cash profit

3,552

3,829

(14)

3,815

-7%

-7%

Australia Retail322,364

300,581-

300,5817%

7%Australia Commercial

63,874

59,911-

59,911

7%

7%

Institutional

206,268

208,265

1,202

209,467-1%-2%

New Zealand

121,625

120,262(2,466)

117,796

1%

3%

1,678

1,661

16

1,677

1%

0%

Net loans and advances by division

Pacific
Group Centre

(638)

(593)

-

(593)

8%

8%

715,171690,087(1,248)688,8394%

4%

Australia Retail

172,312156,374-

156,37410%10%Australia Commercial

116,463

113,011-

113,0113%

3%

Institutional

249,169

278,089

2,777

280,866

-10%

-11%

New Zealand

99,77997,958(2,009)95,9492%

4%

Pacific

3,657

3,562

36

3,598

3%

2%

Group Centre

(290)

(367)

-

(367)

-21%

-21%

641,090648,627804

649,431-1%-1%

Net loans and advances

Customer deposits by division

Customer deposits

30

GROUP RESULTS
March 2024 Half Year v September 2023 Half Year
Half YearNet interest income

Movement

ActualFX
unadjusted

FX
impactFX
adjusted

FX
unadjusted

FX
adjustedMar 24$M
7,899

Sep 23$M
8,074

Sep 23$M
14

Sep 23$M
8,088

Mar 24v. Sep 23-2%

Mar 24v. Sep 23-2%

Other operating income

2,448

2,291

(26)

2,265

7%

8%

Operating income

10,347

10,365(12)

10,3530%0%Operating expenses(5,215)(5,142)(7)(5,149)1%

1%

Cash profit before credit impairment and income tax

5,132

5,223

(19)

5,204

-2%

-1%

Credit impairment (charge)/release

(70)

(112)

1

(111)

-38%

-37%

Cash profit before income tax

5,062

5,111

(18)

5,093

-1%

-1%

Income tax expense(1,496)(1,513)

5(1,508)

-1%

-1%

(14)

(14)

-

(14)

0%

0%

3,552

3,584

(13)

3,571

-1%

-1%

Australia Retail

794

874

-

874

-9%

-9%

Australia Commercial

665

701

-

701

-5%

-5%
12%

Non-controlling interests
Cash profit

Cash profit/(loss) by division

Institutional

1,522

1,360

3

1,363

12%

New Zealand

791

775

4

779

2%

2%

Pacific

31

37

-

37

-16%

-16%

Group Centre

(251)

(163)

(20)

(183)

54%

37%

Cash profit

3,552

3,584

(13)

3,571

-1%

-1%

Australia Retail322,364

312,249-

312,249

3%

3%

Australia Commercial

63,87461,557-61,557

4%

4%

Institutional

206,268

210,234(708)

209,526-2%-2%

New Zealand

121,625

121,824(1,795)120,029

0%

1%

Pacific

1,678

1,684

-

1,684

0%

0%

Group Centre

(638)

(504)

-

(504)

27%

27%

715,171707,044(2,503)

704,5411%

2%

Australia Retail

172,312

164,786-

164,7865%5%Australia Commercial

116,463

113,408-

113,4083%

3%

Institutional

249,169

266,462(1,377)265,085-6%-6%

Net loans and advances by division

Net loans and advances

Customer deposits by division

New Zealand

99,77999,076(1,460)97,6161%

2%

Pacific

3,657

3,719

(3)

3,716

-2%

-2%

Group Centre

(290)

(332)

-

(332)

-13%

-13%

641,090647,119(2,840)644,279-1%

0%

Customer deposits

31

GROUP RESULTS
Earnings Related Hedges
Where it is considered appropriate, the Group takes out economic hedges against larger foreign exchange denominated revenue streams (primarily New
Zealand Dollar and US Dollar). New Zealand Dollar exposure relates to the New Zealand geography and USD exposures relate to Rest of World
geography. Details of these hedges are set out below.
Half Year
Mar 24$M
3,071

NZD Economic hedges
Net open NZD position (notional principal)1,2

Sep 23$M
3,050

Mar 23$M
3,011

Amount taken to income (pre-tax statutory basis)3

23

(7)

(148)

Amount taken to income (pre-tax cash basis)4

(34)

(13)

16

USD Economic hedges
Net open USD position (notional principal)1,2

967

906

750

6

(29)

28

(12)

(11)

(20)

Amount taken to income (pre-tax statutory basis)3
Amount taken to income (pre-tax cash basis)4
1.
2.

Value in AUD at contracted rate.
The following hedges were in place to partially hedge future earnings against adverse movements in exchange rates, at a NZD forward rate of NZD 1.09/AUD as at 31 March 2024
(Sep 23: NZD 1.10/AUD; Mar 23: NZD1.10/AUD), and a USD forward rate of USD 0.67/AUD as at 31 March 2024 (Sep 23: USD 0.68/AUD; Mar 23: USD 0.69/AUD).
Half Year
Mar 24

Sep 23

Mar 23

At period end (NZD billion)

3.4

3.4

3.3

Matured during the period (NZD billion)

1.4

1.4

1.3

At period end (USD billion)

0.6

0.6

0.5

Matured during the period (USD billion)

0.2

0.2

0.1

NZD Economic Hedges

USD Economic Hedges

3.
4.

Unrealised valuation movement plus realised revenue from matured or closed out hedges.
Realised revenue from closed out hedges.

An unrealised gain on the outstanding NZD and USD economic hedges of $75 million for the March 2024 half (Sep 23 half: $12 million loss;
Mar 23 half: $116 million loss) was recorded in statutory profit. This unrealised gain is treated as an adjustment to statutory profit in determining cash
profit (included within revenue and expense hedge adjustments) as these are hedges of future NZD and USD revenues.

Cash Earnings Per ShareHalf Year

Movement

Mar 24

Sep 23

Mar 23

Mar 24v. Sep 23

Mar 24v. Mar 23

Basic

118.3

119.5

127.9

-1%

-8%

Diluted

116.0

114.8

121.4

1%

-4%

Cash earnings per share (cents)

Cash weighted average number of ordinary shares (M)Basic

3,001.3

3,000.2

2,994.1

0%0%

Diluted

3,249.4

3,281.6

3,278.3-1%-1%

Cash profit ($M)

3,552

3,584

3,829

-1%

-7%

Cash profit used in calculating diluted cash earnings per share ($M)

3,769

3,766

3,979

0%

-5%

32

GROUP RESULTS
Dividends
Movement

Half Year
Dividend per ordinary share (cents)
InterimMar 24

Sep 23

Mar 23- fully franked1

-

-

81

83

-

-

-

94

-

83

94

81

Ordinary share dividends used in payout ratio ($M)4,5

2,496

2,825

2,433

Cash profit ($M)

3,552

3,584

3,829

70.3%

78.8%

63.5%

- partially franked2

Mar 24v. Sep 23

Mar 24v. Mar 23

-12%

2%

-1%

-7%

Final
- partially franked (comprising 81 cents and an additional dividend of 13 cents)3
Total

5

Ordinary share dividend payout ratio (cash profit basis)
1.
2.
3.
4.

5.

2023 interim dividend was fully franked for Australian tax purposes (30% tax rate) and carried New Zealand imputation credits of NZD 9 cents.
2024 proposed interim dividend will be partially franked at 65% for Australian tax purposes (30% tax rate) and carry New Zealand imputation credits of NZD 12 cents.
2023 final dividend was partially franked at 56% for Australian tax purposes (30% tax rate) and carried New Zealand imputation credits of NZD 11 cents.
Dividend paid to ordinary equity holders of the Company. Excludes dividends paid by subsidiaries to the Group’s non-controlling equity holders of $13 million (Sep 23 half: $14 million;
Mar 23 half: $13 million).
Dividend payout ratio is calculated using the proposed 2024 interim dividend of $2,496 million, based on the forecast number of ordinary shares on issue at the dividend record date.
Dividend payout ratios for the September 2023 half and March 2023 half were calculated using actual dividends.

The Directors proposed an interim dividend of 83 cents be paid on each eligible fully paid ANZ ordinary share, partially franked at 65% for Australian
taxation purposes. The interim dividend will be paid on 1 July 2024 to owners of ordinary shares at the close of business on 14 May 2024 (record date),and carry New Zealand imputation credits of NZD 12 cents per ordinary share.

Economic Profit
Half Year
Mar 24$M
3,407

Statutory profit attributable to shareholders of the Company
Adjustments between statutory profit and cash profit

Sep 23$M
3,551

Movement
Mar 23$M
3,555

Mar 24v. Sep 23-4%

Mar 24v. Mar 23
-4%
-47%

145

33

274

large

Cash profit

3,552

3,584

3,829

-1%

-7%

Economic credit cost adjustment

(377)

(362)

(333)

4%

13%

Imputation credits

588

553

628

6%

-6%
-9%

Economic return

3,763

3,775

4,124

0%

Cost of capital(3,433)(3,325)(3,267)

3%

5%

Economic profit

330

450

857

-27%

-61%

Economic profit is a risk adjusted profit measure used to evaluate business unit performance. This is used for internal management purposes and is not
subject to audit by the external auditor.
At a business unit level, capital is allocated based on regulatory capital such that higher risk businesses attract higher levels of capital. This method isdesigned to help drive appropriate risk management and ensure business returns align with the level of risk. Key risks covered include credit risk,
operational risk, market risk and other risks.
Economic profit is calculated via a series of adjustments to cash profit:•

The economic credit cost adjustment replaces the accounting expected credit loss charge with internal expected loss based on the average long-run
loss rate per annum on the portfolio over an economic cycle.

•

The benefit of imputation credits is recognised, estimated based on 70% of Australian tax.

•

The cost of capital is a major component of economic profit. At an ANZ Group level, this is calculated using average ordinary shareholders’ equity(excluding non-controlling interests), multiplied by the cost of capital rate (currently at 9.75% with comparative periods restated accordingly).

Economic profit decreased by $527 million against the March 2023 half, driven by lower cash profit, higher levels of capital (with the cost of capital rateunchanged), unfavourable economic credit cost adjustment and lower imputation credits.
Economic profit decreased by $120 million against the September 2023 half, driven by lower cash profit, higher levels of capital (with the cost of capitalrate unchanged), and unfavourable economic credit cost adjustment, partially offset by higher imputation credits.

33

GROUP RESULTS
Condensed Balance Sheet
As at

Movement

AssetsCash / Settlement balances owed to ANZ / Collateral paid

Mar 24$B
149.7

Sep 23$B
186.1

Mar 23$B
225.1

Trading assets and investment securities

160.5

134.4

Derivative financial instruments

47.5

60.4

Net loans and advances

715.2

707.0

690.1

1%

4%

Other

16.8

17.7

16.8

-5%

0%

1,089.7

1,105.6

1,111.2-1%-2%

Total assets

Mar 24v. Sep 23-20%

Mar 24v. Mar 23
-33%

133.6

19%

20%

45.6

-21%

4%

Liabilities
Settlement balances owed by ANZ / Collateral received

22.4

29.7

31.0

-25%

-28%

Deposits and other borrowings

806.7

814.7

842.6

-1%

-4%

Derivative financial instruments

42.7

57.5

46.2

-26%

-8%

Debt issuances

127.1

116.0

106.2

10%

20%

Other

19.7

17.7

15.6

11%

26%

1,018.6

1,035.6

1,041.6

-2%

-2%

71.1

70.0

69.6

2%

2%

Total liabilities
Total shareholders' equity••

March 2024 v March 2023•

Cash / Settlement balances owed to ANZ / Collateral paid decreased $75.4 billion (33%) driven by decreases in balances with central banks($60.9 billion), overnight interbank deposits ($10.6 billion), and settlement balances owed to ANZ ($3.2 billion).

•

Trading assets and investment securities increased $26.9 billion (20%) driven by increases in short term and semi-government bonds.

•

Net loans and advances increased $25.1 billion (4%) driven by increases in the Australia Retail ($21.8 billion) and New Zealand ($3.8 billion)
divisions due to home loan growth, and the Australia Commercial division ($4.0 billion) due to higher lending volumes. This was partially offset bylower lending volumes in the Institutional division ($3.2 billion) and the impact of foreign currency translation.

•

Settlement balances owed by ANZ / Collateral received decreased $8.6 billion (28%) primarily driven by a decrease in cash clearing accounts($7.9 billion).

•

Deposits and other borrowings decreased $35.9 billion (4%) driven by decreases in customer deposits in the Institutional division ($31.7 billion),
deposits from banks and repurchase agreements ($29.6 billion), and certificates of deposit ($5.6 billion). This was partially offset by higher
customer deposits in the Australia Retail ($15.9 billion), New Zealand ($3.8 billion) and Australia Commercial ($3.5 billion) divisions, an increasein commercial paper and other borrowings ($6.4 billion) and the impact of foreign currency translation.

•

Debt issuances increased $20.9 billion (20%) driven by the issue of new senior and subordinated debt, including ANZ Capital Notes 9 partially
offset by the redemption of ANZ Capital Notes 4.

March 2024 v September 2023•

Cash / Settlement balances owed to ANZ / Collateral paid decreased $36.4 billion (20%) driven by decreases in balances with central banks($20.1 billion), settlement balances owed to ANZ ($5.5 billion), overnight interbank deposits ($5.2 billion), reverse repurchase agreements($4.4 billion) and the impact of foreign currency translation.

•

Trading assets and investment securities increased $26.1 billion (19%) driven by increases in short term and semi-government bonds.

•

Derivative financial assets and liabilities decreased $12.9 billion (21%) and $14.8 billion (26%) respectively driven by market rate movements,
primarily decreases in USD swap rates and the depreciation of certain major currencies against the USD.

•

Net loans and advances increased $8.2 billion (1%) driven by increases in the Australia Retail ($10.1 billion) and New Zealand ($1.6 billion)
divisions due to home loan growth, and the Australia Commercial division ($2.3 billion) due to higher lending volumes. This was partially offset bylower lending volumes in the Institutional division ($3.3 billion) and the impact of foreign currency translation.

•

Settlement balances owed by ANZ / Collateral received decreased $7.3 billion (25%) primarily driven by decreases in cash clearing accounts($4.2 billion) and lower collateral received ($2.9 billion).

•

Deposits and other borrowings decreased $8.0 billion (1%) driven by decreases in customer deposits in the Institutional division ($15.9 billion),
deposits from banks and repurchase agreements ($10.8 billion), certificates of deposit ($2.8 billion) and the impact of foreign currencytranslation. This was partially offset by increases in commercial paper and other borrowings ($12.1 billion), and customer deposits in theAustralia Retail ($7.5 billion), Australia Commercial ($3.1 billion) and New Zealand ($2.2 billion) divisions.

•

Debt issuances increased $11.1 billion (10%) driven by the issue of new senior debt and subordinated debt, including ANZ Capital Notes 9
partially offset by the redemption of ANZ Capital Notes 4.

34

GROUP RESULTS
Liquidity Risk
Liquidity risk is the risk that the Group is unable to meet its payment obligations as they fall due, including repaying depositors or maturing wholesaledebt, or that the Group has insufficient capacity to fund increases in assets. The timing mismatch of cash flows and the related liquidity risk is inherent inall banking operations and is closely monitored by the Group and managed in accordance with the risk appetite set by the relevant Boards.
The Group operates under a non-operating holding company structure whereby:•

ANZBGL’s liquidity risk management framework remains unchanged and continues to operate its own liquidity and funding program, governanceframeworks and reporting regime reflecting its Authorised Deposit-taking Institution (ADI) operations;•ANZGHL (parent entity) has no material liquidity risk given the structure and nature of the balance sheet; and•

ANZ Non-Bank Group is not expected to have separate funding arrangements and will rely on ANZGHL for funding.

Furthermore, a separate liquidity policy has been established for ANZGHL and ANZ Bank Group to reflect the differing nature of liquidity risk inherent ineach business model. The Group will ensure that ANZGHL and ANZ Non-Bank Group holds sufficient cash reserves to meet operating and financing
requirements.
ANZ Bank Group’s approach to liquidity risk management incorporates two key components:•

Scenario modelling of funding sources
ANZBGL Group’s liquidity risk appetite is defined by the ability to meet a range of regulatory requirements and internal liquidity metrics mandated by
the ANZBGL Board. The metrics cover a range of scenarios of varying duration and level of severity. The objective of this framework is to:•Provide protection against shorter term extreme market dislocation and stress.

•

Maintain structural strength in the balance sheet by ensuring that an appropriate amount of longer-term assets are funded with longer-term
funding.

•

Ensure that no undue timing concentrations exist in the Group’s funding profile.

Key components of this framework are the Liquidity Coverage Ratio (LCR), which is a severe short term liquidity stress scenario, and the Net Stable
Funding Ratio (NSFR), a longer term structural liquidity measure, both of which are mandated by banking regulators including APRA.
•

Liquid assets
ANZBGL Group holds a portfolio of high quality unencumbered liquid assets in order to protect ANZBGL Group’s liquidity position in a severely
stressed environment, as well as to meet regulatory requirements. High Quality Liquid Assets comprise three categories, with the definitions
consistent with Basel 3 LCR:•

Highest-quality liquid assets (HQLA1): Cash, highest credit quality government, central bank or public sector securities eligible for repurchasewith central banks to provide same-day liquidity.

•

High-quality liquid assets (HQLA2): High credit quality government, central bank or public sector securities, high quality corporate debt securities
and high quality covered bonds eligible for repurchase with central banks to provide same-day liquidity.

•

Alternative liquid assets (ALA): Eligible securities listed by the RBNZ.

ANZBGL Group monitors and manages the size and composition of its liquid assets portfolio on an ongoing basis in line with regulatory requirements
and the risk appetite set by the ANZBGL Board.
Half Year Average1

Movement

Mar 24$B

Sep 23$B

Mar 23
$B

HQLA1

268.2

258.6

253.5

4%

6%

HQLA2

11.6

9.8

9.7

18%

20%

Mar 24v. Sep 23

Mar 24v. Mar 23

Market Values Post Discount

Alternative liquid assets2

1.9

2.4

2.7

-21%

-30%

281.7

270.8

265.9

4%

6%

Cash outflows

262.8

256.1

268.8

3%

-2%

Cash inflows

51.9

51.4

60.5

1%

-14%

Net cash outflows

210.9

204.7

208.3

3%

1%

Liquidity Coverage Ratio3,4

134%

132%

128%

2%

6%

Total liquid assets
Cash flows modelled under stress scenario

1.
2.
3.
4.

Half year average basis, calculated as prescribed per APRA Prudential Regulatory Standard (APS 210 Liquidity) and consistent with APS 330 requirements.
Comprised of any liquid assets as defined in the RBNZ's Liquidity Policy - Annex: Liquidity Assets - Prudential Supervision Department Document BS13A12.
All currency Level 2 LCR.
LCR remained above the regulatory minimum thresholds throughout the periods.

35

GROUP RESULTS
Funding
The ANZBGL Group targets a diversified funding base, avoiding undue concentrations by investor type, maturity, market source and currency.
During the March 2024 half, the ANZBGL Group issued $21.2 billion of term wholesale funding1, $1.7 billion of APRA compliant Additional Tier 1 Capitaland $0.3 billion of RBNZ compliant Additional Tier 1 Capital.
The following table shows the ANZBGL Group’s total funding composition:
As at

Movement

ANZ Bank GroupMar 24$B

Sep 23$B

Mar 23$B

Mar 24v. Sep 23

Mar 24v. Mar 23

Customer deposits and other liabilities
Australia Retail

172.3

164.8

156.4

5%

10%

Australia Commercial

116.5

113.4

113.0

3%

3%

Institutional

249.2

266.5

278.1

-6%

-10%

New Zealand

99.8

99.1

98.0

1%

2%

Pacific

3.7

3.7

3.6

0%

3%

Group Centre

(0.2)

(0.1)

(0.2)

large

0%

Customer deposits

641.3

647.4

648.9

-1%

-1%

Other funding liabilities2

10.8

11.7

12.4

-8%

-13%

Total customer liabilities (funding)

652.1

659.1

661.3

-1%

-1%

Wholesale funding
Unsubordinated debt and central bank term funding3

102.3

94.0

97.1

9%

5%

Subordinated debt4

36.3

33.7

32.7

8%

11%

Certificates of deposit

39.1

41.9

44.5

-7%

-12%

Commercial paper

45.2

33.3

38.8

36%

16%

Other wholesale borrowings5

96.8

113.9

122.5

-15%

-21%

Total wholesale funding

319.7

316.8

335.6

1%

-5%

Shareholders' equity

70.2

69.1

68.6

2%

2%

1,042.0

1,045.0

1,065.5

0%-2%

Total funding
1.
2.
3.

4.

5.

Excludes unsubordinated debt with shorter tenors (such as 12 to 18 months).
Includes interest accruals, payables and other liabilities, provisions and net tax provisions, and excludes liability for acceptances as they do not provide net funding.
Includes RBA TFF of $8.1 billion (Sep 23: $8.1 billion; Mar 23: $20.1 billion), RBNZ FLP of $3.2 billion (Sep 23: $3.2 billion; Mar 23: $3.2 billion) and TLF of $0.3 billion(Sep 23: $0.3 billion; Mar 23: $0.3 billion).
Includes subordinated debt issued by ANZ Bank New Zealand Limited which constitutes Tier 2 capital under RBNZ requirements but does not meet the APRA Tier 2 requirements, and
USD 300 million perpetual subordinated notes which ceased to be treated as Basel 3 transitional Tier 2 capital under APRA’s capital framework from 1 January 2022. The USD 300 million
perpetual subordinated notes were redeemed on 31 October 2023.
Includes borrowings from banks, securities sold under repurchase agreements, net derivative balances, special purpose vehicles and other borrowings.

Net Stable Funding Ratio
The following table shows the Level 2 NSFR composition:
As at

Movement

Mar 24$B

Sep 23$B

Mar 23$B

Required Stable Funding (RSF)1
Retail & small and medium enterprises, corporate loans with 65% RSF factor2

218.3

213.6

200.5

2%

9%

Retail & small and medium enterprises, corporate loans with 85% RSF factors2

206.1

208.5

221.3

-1%

-7%

Other lending3

56.2

54.9

37.2

2%

51%

Liquid assets

15.1

13.8

13.1

9%

15%

Other assets4

46.8

46.8

45.2

0%

4%

Total Required Stable Funding

542.5

537.6

517.3

1%

5%

Retail & small and medium enterprise customer deposits

308.9

301.3

292.9

3%

5%

Corporate, public sector entities & operational deposits

128.5

130.8

136.9

-2%

-6%

Mar 24v. Sep 23

Mar 24v. Mar 23

Available Stable Funding1

Central bank & other financial institution deposits

6.4

7.2

4.7

-11%

36%

Term funding5

81.5

76.0

71.3

7%

14%

Short term funding & other liabilities

12.4

10.3

8.5

20%

46%

Capital

102.7

99.6

99.4

3%

3%

Total Available Stable Funding

640.4

625.2

613.7

2%

4%

Net Stable Funding Ratio6

118%

116%

119%

2%

-1%

1.
2.
3.
4.
5.
6.

NSFR factored balance as per APRA Prudential Regulatory Standard APS 210 Liquidity.
Risk weighting as per APRA Prudential Regulatory Standard APS 112 Capital Adequacy: Standardised Approach to Credit Risk.
Includes loans to financial institutions and central banks, and non-performing loans.
Includes off-balance sheet items, net derivatives and other assets.
Includes balances from the drawdown of the RBA and RBNZ Funding Facilities (TFF, FLP and TLF).
The regulatory minimum NSFR is 100%.

36

GROUP RESULTS
Capital Management
The Group’s capital management framework includes managing capital at Level 1, Level 2 and ANZGHL Group.
The Group’s framework includes managing to Board approved risk appetite settings and maintaining all regulatory requirements. APRA requirements at
Level 1 and Level 2 include ANZ operating at or above APRA’s expectation for Domestic Systematically Important Banks (D-SIBs).
APRA’s authority for ANZGHL to be a non-operating holding company (NOHC) of an ADI includes five conditions for ANZ’s capital management
framework. Two of these are quantitative requirements being:•

ANZGHL must always ensure that the quality and quantity of the total capital of the Level 3 group is equivalent to, or greater than, the quality andquantity of the sum of the total capital of the consolidated ANZ Bank Group and the consolidated ANZ Non-Bank Group.

•

ANZGHL must calculate and manage capital for the ANZ Non-Bank Group in accordance with an Economic Capital Model (ECM), which requires theamount of capital held, in the form of Common Equity Tier 1 (CET1), to be equal to or greater than the capital requirement as calculated under the
ECM.

The Group has implemented an ECM to calculate the capital to support the ANZ Non-Bank Group operations. The material risks included in the NonBank Group currently are investment risk and fixed asset risk.
The Group’s compliance with these two conditions is presented in the following tables:
ANZ Bank
Group2$M

ANZ Non-Bank
Group
$M

ANZGHL$M

ANZ Group$M

70,202716

156

71,074

(648)

-

-

(648)

As at March 2024
Allocated equity1
Prudential adjustments to allocated equity
Gross Common Equity Tier 1 capital

69,554716

156

70,426

Deductions(11,142)--(11,142)

Common Equity Tier 1 capital

58,412716

156

59,284Tier 1 capital

66,709716

156

67,581

Tier 2 capital

28,223--28,223

Total qualifying capital

94,932716

156

95,80469,085749

183

70,017As at September 2023
Allocated equity1
Prudential adjustments to shareholders' equity

(396)

-

-

(396)

Gross Common Equity Tier 1 capital

68,689749

183

69,621

Deductions(10,895)--(10,895)

Common Equity Tier 1 capital

57,794749

183

58,726Tier 1 capital

66,026749

183

66,958Tier 2 capital

24,959--24,959Total qualifying capital

90,985749

183

91,917

68,596739

245

69,580

(329)

-

-

(329)

Gross Common Equity Tier 1 capital

68,267739

245

69,251

Deductions(10,887)--(10,887)

Common Equity Tier 1 capital

57,380739

245

58,364Tier 1 capital

65,564739

245

66,548Tier 2 capital

24,068--24,068

Total qualifying capital

89,632739

245

90,616As at March 2023
Allocated equity1
Prudential adjustments to shareholders' equity

1.
2.

Allocated in accordance with prudential capital management view.
ANZ Bank Group allocated equity is adjusted for capital deductions, including deconsolidated entity adjustments, to calculate ANZ Level 2 CET1, Tier 1, Tier 2 and total qualifying capital.

ANZ Non-Bank Group
As at
Mar 24$M

Sep 23$M

Mar 23$M

Economic Capital Required

571

563

674

Actual Capital1

740

744

772

Actual vs Economic Capital

169

181

98

1. This represents the aggregation of ANZ NBH Pty Ltd and ANZ Group Services Pty Ltd’s shareholders’ equity.

37

GROUP RESULTS

ANZ Bank GroupAs at
Internationally Comparable Capital Ratios1

APRA Capital Ratios
Mar 24

Sep 23

Mar 23

Mar 24

Sep 23

Mar 23

Common Equity Tier 1

13.5%

13.3%

13.2%

19.7%

19.7%

19.4%

Tier 1

15.4%

15.2%

15.1%

22.2%

22.2%

21.8%

Total capital

21.9%

21.0%

20.6%

30.7%

29.8%

29.1%

Risk weighted assets ($B)

432.8

433.3

435.5

334.1

331.5

334.4

Capital Ratios (Level 2)

1.

Internationally Comparable methodology align with the Australia Banking Association Basel 3.1 Capital Comparison Study (March 2023).

APRA Common Equity Tier 1 - March 2024 v September 2023•

March 2024 v September 2023
CET1 ratio increased +16 bps to 13.50% during the March 2024 half. Key drivers of the movement in the CET1 ratio were:•Cash profit (Level 2) increased the CET1 ratio by +83 bps.

•

Higher underlying RWA usage (excluding impact of foreign currency translation, regulatory changes and other one-offs) decreased the CET1
ratio by -12 bps primarily driven by higher credit RWA, market risk RWA and operational RWA, partially offset by lower IRRBB RWA.

•

Payment of the 2023 final dividend (net of BOP) reduced the CET1 ratio by -64 bps.

•

Proceeds from partial disposal of investment in AmBank increased the CET1 ratio by +15 bps.

•

Capital deduction and others impact totalling -6 bps reflecting net movements in IRB floor increase, capital deductions, net imposts, non-cash
profit adjustments and net other items, partially offset by benefits from credit RWA methodology refinements.

March 2024 pro-forma CET1 capital ratio of 11.85% includes pro-forma adjustments for:•

Suncorp Bank acquisition of -123 bps,•

The announced $2 billion on-market share buyback of -46 bps, and•NOHC surplus capital of +4 bps.

38

GROUP RESULTS
As at

Total Risk Weighted Assets

Credit RWA

Movement

Mar 24$B
348.4

Sep 23$B
349.0

Mar 23$B
345.3

Mar 24v. Sep 23
0%

Mar 24v. Mar 23
1%

Market risk and IRRBB RWA

38.1

42.0

43.6

-9%

-13%

Operational RWA

43.3

42.3

42.3

2%

2%

Total

429.8

433.3

431.2

-1%

0%

3.0

-

4.3

n/a

-30%

432.8

433.3

435.5

0%

-1%

IRB floor adjustment
Total RWA

Total Risk Weighted Assets - March 2024 v September 2023

1.

•

The attribution of credit RWA movements requires assumptions and judgement, with different assumptions leading to different attributions.

March 2024 v September 2023
Total RWA decreased $0.5 billion driven by:•$0.6 billion decrease in total credit RWA primarily driven by benefits from credit RWA methodology refinements and the impact of foreign
currency translation, partially offset by volume growth in the Institutional, Australia Retail and Australia Commercial divisions.

•Credit RWA methodology refinements includes benefits from continued refinement in process, data and associated methodology treatments post
implementation of revised capital reform rules, implementation of a new model relating to New Zealand rural exposures, and removal of
associated RBNZ supervisory adjustment for corporate exposures.

•$2.9 billion decrease in underlying non-credit RWA (operational RWA, and market risk and IRRBB RWA) mainly from a reduction in IRRBB RWA
partially offset by increases in market risk RWA and operational RWA.

•

IRB floor adjustment increased from nil to $3.0 billion.

39

GROUP RESULTS
APRA Capital Reform to Internationally Comparable1 CET1 as at 31 March 2024

1. The Group’s interpretation of the Basel Calculation of RWA for credit risk regulations (effective 1 Jan 2023) documented in The Basel Framework and The Australian Banking Association,

Basel 3.1 Capital Comparison Study, March 2023.

The above graph provides a reconciliation of the CET1 ratio under APRA’s prudential capital standards to Internationally Comparable Basel 3.1
standards. One of the objectives, although not the primary objective, of the revisions APRA has made is to ‘improve transparency, by increasing thealignment of APRA’s standards with the international Basel framework’ (APRA Information Paper – An Unquestionably Strong Framework for Bank
Capital, November 2021). Despite this, material differences in the way credit risks are measured remain between the approaches allowed by APRA andthose proposed by Basel. As a result, Australian banks’ APRA reported capital ratios will not be directly comparable with the Basel 3.1 capital ratios ordirectly comparable with many international jurisdictions which are yet to transition to the revised Basel 3.1 Capital Framework.
The material differences between APRA and Internationally Comparable capital ratios include:
Deductions•

Investments in insurance and banking associates - APRA requires a full deduction against CET1. On an Internationally Comparable basis, theseinvestments are subject to a concessional threshold before a deduction is required.

•

Deferred tax assets - APRA requires a full deduction from CET1 for deferred tax assets relating to temporary differences. On an Internationally
Comparable basis, this is subject to a concessional threshold before the deduction is required.

Risk Weighted Assets•

Mortgages RWA•

Standard residential mortgages - APRA imposes risk weight multipliers of 1.4x against owner occupied, principal and interest mortgages and 1.7x
against all other mortgage types as well as a 5% risk weight floor across the total mortgage portfolio. Basel regulations impose no risk weightfloors or multipliers.

•

Non-standard residential mortgages - APRA excludes all non-standard residential mortgages from using the IRB approach unlike Basel.

•

Borrowers with multiple mortgaged investment properties – APRA treats these as retail exposures, with a 2.5x multiplier applied if the number ofinvestment properties exceeds 5. Basel allows these exposures to be treated as corporate exposures.

•

IRRBB RWA - APRA requires inclusion of IRRBB within the RWA base for the CET1 ratio calculation. This is not required on an Internationally
Comparable basis.

•Non-retail LGDs - APRA allows lower LGDs for sovereign (Foundation IRB treatment only) and critical infrastructure operator exposures than Baselbut requires higher LGDs for general corporate exposures.

•

New Zealand subsidiary lending - APRA requires the credit RWA amounts for all credit exposures originated by a New Zealand subsidiary to be
calculated using the Reserve Bank of New Zealand (RBNZ) capital rules, except for APRA’s overall IRB scalar, which must replace the RBNZ scalar.
In comparison with Basel, the RBNZ uses a different supervisory slotting approach for specified asset classes, different LGD floors for farm lending,different LGD floors and correlation factors for residential mortgages, and different LGD and EAD factors for undrawn non-retail exposures.

•

Other RWA impacts - APRA requires the supervisory slotting approach to be used in determining credit RWA for specialised lending exposures. The
Internationally Comparable basis allows for the advanced IRB approach to be used when calculating RWA for these exposures. APRA has now
allowed the advanced IRB approach for income producing real estate exposures, which were previously required to use slotting.

•

Scaling factor on all IRB exposures of 1.1x is applied.

40

GROUP RESULTS
Leverage Ratio
At 31 March 2024, the ANZ Bank Group’s APRA Leverage Ratio was 5.4% which is above the 3.5% APRA minimum for IRB ADIs which includes ANZ.
The following table summarises the ANZ Bank Group’s Leverage Ratio calculation:
As at

Movement

Mar 24$M

Sep 23$M

Mar 23$M

Mar 24v. Sep 23

Mar 24v. Mar 23

Tier 1 Capital (net of capital deductions)

66,70966,02665,5641%

2%On-balance sheet exposures (excluding derivatives and securities financing transaction
exposures)

984,875

984,663

1,013,515

0%-3%Derivative exposures

59,35751,00844,612

16%

33%

Securities financing transaction exposures

58,99550,74743,756

16%

35%

Other off-balance sheet exposures

124,894

138,301

140,999

-10%

-11%

1,228,121

1,224,719

1,242,882

0%-1%

APRA Leverage Ratio

5.4%

5.4%

5.3%

Internationally Comparable Leverage Ratio

6.0%

6.0%

5.9%

Total exposure measure•

March 2024 v September 2023
APRA leverage ratio increased +4 bps during the March 2024 half. Key drivers of the movement were:•

Net organic capital generation (largely from cash profit and movements in capital deductions), less dividends paid increased the leverage ratio by+5 bps,••Additional Tier 1 capital impact (ANZ Capital Notes 9 issuance net of ANZ Capital Notes 4 redemption) increased the leverage ratio by +1 bps,
On-balance sheet exposures growth decreased the leverage ratio by -2 bps. On-balance sheet exposures growth was driven by lending growthin the Australia Retail, Australia Commercial and New Zealand divisions, and growth in Trading assets and Investment securities, partially offset
by reduction in lending volume in the Institutional division and reduction in Cash and cash equivalents.

•

Net movements in derivative, securities financing transactions and other off-balance sheet exposures decreased the leverage ratio by -2 bps,
and•Net other impacts increased the leverage ratio by +2 bps.

41

GROUP RESULTS
Capital Management - Other Developments•

Capital Requirements
APRA implemented its updated requirements in relation to capital adequacy and credit risk requirements for ADIs on 1 January 2023. In December
2023, APRA released for consultation proposed minor amendments to the capital framework for ADIs. One update is related to Prudential Standard
APS 112 Capital Adequacy: Standardised Approach to Credit Risk, which could potentially reduce standardised RWA. ADIs now calculate RWA
under both the IRB RWA approach and the standardised RWA approach. When the standardised RWA multiplied by 72.5% is greater than the IRB
RWA, the difference is added as an adjustment to the total IRB RWA. Therefore, any reduction in the standardised RWA may reduce (or eliminate)
the quantum of the IRB capital floor adjustment. The Group responded to APRA’s consultation in March 2024 and APRA is conducting a quantitative
impact study with selected ADIs.
In addition, APRA continues to consult and finalise revisions to a number of remaining prudential standards, being IRRBB, market risk andcounterparty credit risk. Given the number of items that are yet to be finalised by APRA, the aggregate final outcome from all changes to APRA's
prudential standards relating to their review of ADIs ‘unquestionably strong’ capital framework remains uncertain.

•

APRA Total Loss Absorbing Capacity Requirements
On 2 December 2021, APRA finalised its loss-absorbing capacity requirements for Australian D-SIBs, including ANZBGL, requiring an increase to
their minimum total capital requirement by 4.5% of RWA by January 2026. APRA expects the requirement to be satisfied predominantly withadditional Tier 2 capital with an equivalent decrease in other senior funding. The amount of the additional total capital requirement will be based on
the Group’s actual RWA as at January 2026.

•

APRA Discussion Paper on Additional Tier 1 Capital in Australia
In September 2023, APRA released a discussion paper entitled “Enhancing bank resilience: Additional Tier 1 Capital in Australia” (APRA Discussion
Paper) which explores options for, and seeks feedback from stakeholders on, the effectiveness of Additional Tier 1 (AT1) Capital in Australia.
Potential options raised by APRA include:•

Improving the key design features of Additional Tier 1 Capital (including potentially increasing capital trigger event threshold requirements fromthe current 5.125% to a higher level) so it more effectively absorbs losses;•

Changing the required level or mix of regulatory capital requirements to reduce reliance on Additional Tier 1 Capital; and•Changes to diversify the investor base for Additional Tier 1 Capital instruments away from domestic retail investors.

The Group has engaged with APRA in a bilateral discussion on the APRA Discussion Paper and provided a submission in response to APRA’s
Additional Tier 1 Consultation on 15 November 2023. APRA has indicated that it intends to formally consult in 2024 on any proposed amendments to
the relevant prudential standards and in implementing any options, there would be a transition time to enable issuers to adjust to new requirements.
At this stage, it is not possible to confirm what impact (if any) the options proposed by APRA may have on the Group.
•

The Reserve Bank of New Zealand review of capital requirements
The RBNZ’s revised capital adequacy requirements for New Zealand banks, which are set out in the Banking Prudential Requirements documents
are being implemented in stages during a transition period from October 2021 to July 2028. The key requirements for ANZ Bank New Zealand
Limited (ANZ Bank New Zealand) still being implemented are as follows:•

ANZ Bank New Zealand’s Tier 1 capital requirement will increase to 16% of RWA, of which up to 2.5% can be in the form of AT1 Capital. ANZBank New Zealand’s Total Capital requirement will increase to 18% of RWA, of which up to 2% can be Tier 2 Capital. The increased capital ratio
requirements are being implemented progressively from 1 July 2022 to 1 July 2028.

•

AT1 capital must consist of perpetual preference shares, which may be redeemable. Tier 2 capital must consist of long-term subordinated debt.

The net impact on the Group’s Level 1 CET1 capital, by the end of the transition period in 2028, is dependent on the additional capital required by
ANZ Bank New Zealand to comply with the increased capital requirements. Whether the additional capital requirement for ANZ Bank New Zealand
results in financial implications for ANZ will also depend on whether ANZ’s Level 1 CET1 ratio is lower than ANZ’s Level 2 CET1 ratio in 2028. Given
the level of uncertainty of these outcomes, the future financial impact of the RBNZ’s revised capital adequacy requirements is not able to bequantified currently.
•

Group regulation - roadmap for review
In October 2022, APRA released a roadmap for review of the prudential framework for groups. The review will focus on rationalising requirements,
promoting consistency, and providing clarity across different standards that apply to groups. As part of the review, guidelines for licensing new NOHC
authorities will be updated. For existing APRA authorised NOHCs, there will be no immediate changes, although APRA will seek to ensure new or
adjusted NOHC license conditions are applied in a consistent manner. The review will be multi-year, finishing in 2025.

42

DIVISIONAL RESULTSCONTENTS

Page

Divisional Performance

44

Australia Retail

48

Australia Commercial

50

Institutional

52

New Zealand

59

Pacific

64Group Centre

64

43

DIVISIONAL RESULTS
Divisional Performance
During the March 2024 half, the Group operated on a divisional structure with six divisions: Australia Retail, Australia Commercial, Institutional, New
Zealand, Pacific, and Group Centre. For further information on the composition of divisions, refer to the Definitions on page 125.
Restatement of prior period comparative information•

Accounting standards adoption - the Group adopted AASB 17 Insurance Contracts (AASB 17) on 1 October 2023. Although the overall profit
recognised in respect of insurance contracts will not change over the life of contracts, the timing of revenue recognition will change. The Groupapplied AASB 17 effective from 1 October 2022 and restated prior period comparative information. This resulted in a decrease in opening retained
earnings of $37 million on 1 October 2022, an increase in profit after tax (Sep 23 half: nil; Mar 23 half: $8 million), an increase in total assets (Sep 23:$22 million; Mar 23: $36 million), and an increase in total liabilities (Sep 23: $51 million; Mar 23: $65 million) in the Australia Retail division.

•

Divisional results presentation – divisional prior period comparative information was restated to reflect a number of cost reallocations across andwithin the divisions during the period, with no impact to Group results.

Other than those described above, there have been no other significant changes.
The divisions reported are consistent with internal reporting provided to the chief operating decision maker, being the Chief Executive Officer.
The Divisional Results section is reported on a cash profit basis.

44

DIVISIONAL RESULTS
Divisional Performance
Cash profit by division - March 2024 Half Year v March 2023 Half Year

March 2024 Half YearNet interest income
Other operating income

Australia
Retail$M
2,608

Australia
Commercial
$M
1,580

Institutional
$M
1,882

New Zealand
$M
1,572

Pacific
$M
63

Group
Centre
$M
194

Group
$M
7,899

301

169

1,687

208

44

39

2,448

Operating income

2,909

1,749

3,569

1,780

107

233

10,347

Operating expenses(1,735)(763)(1,444)

(677)

(70)

(526)

(5,215)

1,174

986

2,125

1,103

37

(293)

5,132

(43)

(35)

6

(4)

6

-

(70)

Cash profit/(loss) before credit impairment andincome tax
Credit impairment (charge)/releaseCash profit/(loss) before income tax

1,131

951

2,131

1,099

43

(293)

5,062

Income tax expense

(337)

(286)

(609)

(308)

(11)

55

(1,496)

Non-controlling interests
Cash profit/(loss)

March 2023 Half YearNet interest income
Other operating income

-

-

-

-

(1)

(13)

(14)

794

665

1,522

791

31

(251)

3,552

Australia
Retail$M

Australia
Commercial$M

Institutional$M

New Zealand$M

Pacific$M

Group
Centre
$M

Group
$M

3,015

1,632

2,071

1,582

62

138

8,500

296

175

1,373

199

40

(43)

2,040

Operating income

3,311

1,807

3,444

1,781

102

95

10,540Operating expenses(1,703)(685)(1,340)

(634)

(74)

(561)

(4,997)

Cash profit/(loss) before credit impairment andincome tax

1,608

1,122

2,104

1,147

28

(466)

5,543

Credit impairment (charge)/release

(82)

(66)

74

(75)

16

-

(133)

Cash profit/(loss) before income tax

1,526

1,056

2,178

1,072

44

(466)

5,410

Income tax expense

(462)

(317)

(589)

(301)

(10)

112

(1,567)

-

-

-

-

-

(14)

(14)

1,064

739

1,589

771

34

(368)

3,829

Australia
RetailAustralia
Commercial

Institutional

New ZealandPacific

Group
Centre

Group

-13%

-3%

-9%

-1%

2%

41%

-7%

2%

-3%

23%

5%

10%

large

20%

-12%

-3%

4%

0%

5%

large

-2%

2%

11%

8%

7%

-5%

-6%

4%

-27%

-12%

1%

-4%

32%

-37%

-7%

Non-controlling interests
Cash profit/(loss)

March 2024 Half Year v March 2023 Half YearNet interest income
Other operating income
Operating income
Operating expenses
Cash profit/(loss) before credit impairment andincome tax
Credit impairment (charge)/release

-48%

-47%

-92%

-95%

-63%

n/a

-47%

Cash profit/(loss) before income tax

-26%

-10%

-2%

3%

-2%

-37%

-6%

Income tax expense

-27%

-10%

3%

2%

10%

-51%

-5%

n/a

n/a

n/a

n/a

n/a

-7%

0%

-25%

-10%

-4%

3%

-9%

-32%

-7%

Non-controlling interests
Cash profit/(loss)

45

DIVISIONAL RESULTS
Divisional Performance
Cash profit by division - March 2024 Half Year v September 2023 Half Year

March 2024 Half YearNet interest income
Other operating income

Australia
Retail$M
2,608

Australia
Commercial
$M
1,580

Institutional
$M
1,882

New Zealand
$M
1,572

Pacific
$M
63

Group
Centre
$M
194

Group
$M
7,899

301

169

1,687

208

44

39

2,448

Operating income

2,909

1,749

3,569

1,780

107

233

10,347

Operating expenses(1,735)(763)(1,444)

(677)

(70)

(526)

(5,215)

1,174

986

2,125

1,103

37

(293)

5,132

Cash profit/(loss) before credit impairment andincome tax
Credit impairment (charge)/release

(43)

(35)

6

(4)

6

-

(70)

Cash profit/(loss) before income tax

1,131

951

2,131

1,099

43

(293)

5,062

Income tax expense

(337)

(286)

(609)

(308)

(11)

55

(1,496)

-

-

-

-

(1)

(13)

(14)

794

665

1,522

791

31

(251)

3,552

Australia
Retail$M

Australia
Commercial$M

Institutional$M

New Zealand$M

Pacific$M

Group
Centre
$M

Group
$M

2,694

1,592

1,969

1,567

61

191

8,074

374

190

1,321

210

45

151

2,291

Operating income

3,068

1,782

3,290

1,777

106

342

10,365

Operating expenses(1,758)(738)(1,388)

(665)

(71)

(522)

(5,142)

Cash profit/(loss) before credit impairment andincome tax

1,310

1,044

1,902

1,112

35

(180)

5,223

Non-controlling interests
Cash profit/(loss)

September 2023 Half YearNet interest income
Other operating income

Credit impairment (charge)/release

(53)

(41)

6

(37)

12

1

(112)

Cash profit/(loss) before income tax

1,257

1,003

1,908

1,075

47

(179)

5,111

Income tax expense

(383)

(302)

(548)

(300)

(8)

28

(1,513)

-

-

-

-

(2)

(12)

(14)

874

701

1,360

775

37

(163)

3,584

Australia
RetailAustralia
Commercial

Institutional

New ZealandPacific

Group
CentreGroup

Net interest income

-3%

-1%

-4%

0%

3%

2%

-2%

Other operating income

-20%

-11%

28%

-1%

-2%

-74%

7%

Operating income

-5%

-2%

8%

0%

1%

-32%

0%

Operating expenses

-1%

3%

4%

2%

-1%

1%

1%

Cash profit/(loss) before credit impairment andincome tax
Credit impairment (charge)/release

-10%

-6%

12%

-1%

6%

63%

-2%

-19%

-15%

0%

-89%

-50%

large

-38%

Non-controlling interests
Cash profit/(loss)

March 2024 Half Year v September 2023 Half Year

Cash profit/(loss) before income tax

-10%

-5%

12%

2%

-9%

64%

-1%

Income tax expense

-12%

-5%

11%

3%

38%

96%

-1%

Non-controlling interests

n/a

n/a

n/a

n/a

-50%

8%

0%

Cash profit/(loss)

-9%

-5%

12%

2%

-16%

54%

-1%

46

DIVISIONAL RESULTS
Divisional Performance
Key Balance Sheet Metrics by division
As at
Net Loans and Advances
Australia Retail
Australia Commercial
Institutional

1

New Zealand1
Pacific1
Group Centre

Movement

Mar 24$B
322.4

Sep 23$B
312.2

Mar 23$B
300.6

Mar 24v. Sep 23
3%

Mar 24v. Mar 23
7%

63.9

61.6

59.9

4%

7%

206.3

210.2

208.3

-2%

-1%

121.6

121.8

120.3

0%

1%

1.7

1.7

1.7

0%

0%

(0.7)

(0.5)

(0.7)

40%

0%

Total

715.2

707.0

690.1

1%

4%

Customer Deposits
Australia Retail

172.3

164.8

156.4

5%

10%

Australia Commercial

116.5

113.4

113.0

3%

3%

1

249.2

266.5

278.1

-6%

-10%

New Zealand1

99.8

99.1

98.0

1%

2%

Pacific1

3.7

3.7

3.6

0%

3%

Group Centre

(0.4)

(0.3)

(0.5)

33%

-20%

Total

641.1

647.1

648.6

-1%

-1%

Risk Weighted Assets
Australia Retail

130.2

127.7

117.8

2%

11%

Australia Commercial

46.6

47.5

47.4

-2%

-2%

Institutional

171.4

175.2

183.1

-2%

-6%

New Zealand

66.8

70.9

71.7

-6%

-7%

Pacific

3.6

3.8

4.1

-5%

-12%

Group Centre

14.2

8.2

11.3

73%

26%

Total

432.8

433.3

435.5

0%

-1%

Institutional

Half Year
Return on Average Risk Weighted Assets
Australia RetailMar 24
1.22%

Sep 23
1.43%

Mar 23
1.73%

Australia Commercial

2.83%

2.93%

2.83%

Institutional

1.77%

1.51%

1.58%

New Zealand

2.31%

2.18%

2.41%

Pacific

1.67%

1.85%

1.76%

Group Centre(5.01%)(3.42%)(10.77%)

Total

1.65%

1.65%

1.70%

1.

Refer to pages 30 and 31 for Net loans and advances and customer deposits movements excluding the impact of foreign currency translation.

47

DIVISIONAL RESULTS
Australia Retail
Maile Carnegie
Half Year
Mar 24$M
2,608

Net interest income

Sep 23$M
2,694

Movement
Mar 23$M
3,015

Mar 24v. Sep 23-3%

Mar 24v. Mar 23
-13%

301

374

296

-20%

2%

Operating income

2,909

3,068

3,311

-5%

-12%

Operating expenses(1,735)(1,758)(1,703)-1%

2%

Cash profit before credit impairment and income tax

1,174

1,310

1,608

-10%

-27%

(43)

(53)

(82)

-19%

-48%

Cash profit before income tax

1,131

1,257

1,526

-10%

-26%

Income tax expense

(337)

(383)

(462)

-12%

-27%

Cash profit

794

874

1,064

-9%

-25%

Balance Sheet
Net loans and advances

322,364

312,249

300,581

3%

7%

Other external assets

3,411

2,958

3,239

15%

5%

External assets

325,775

315,207

303,820

3%

7%

Customer deposits

172,312

164,786

156,374

5%

10%

4,172

4,140

3,923

1%

6%

External liabilities

176,484

168,926

160,297

4%

10%

Risk weighted assets

130,184

127,673

117,844

2%

10%

Average gross loans and advances

318,649

307,124

297,255

4%

7%

Average deposits and other borrowings

168,912

159,786

152,392

6%

11%

RatiosReturn on average assets

0.50%

0.56%

0.71%

Net interest margin

1.94%

2.06%

2.38%

Operating expenses to operating income

59.6%

57.3%

51.4%

Operating expenses to average assets

1.08%

1.13%

1.14%

49

48

32

2%

53%

0.03%

0.03%

0.02%

(6)

5

50

large

large

(0.00%)

0.00%

0.03%

669

520

415

29%

61%

Gross impaired assets as a % of GLA

0.21%

0.17%

0.14%

Total FTE

11,383

11,313

11,1991%

2%

Other operating income

Credit impairment (charge)/release

Other external liabilities

Individually assessed credit impairment charge/(release)
Individually assessed credit impairment charge/(release) as a % of average GLA1
Collectively assessed credit impairment charge/(release)1

Collectively assessed credit impairment charge/(release) as a % of average GLA
Gross impaired assets

1.

Credit impairment charge/(release) used in the ratio relates to gross loans and advances and off-balance sheet commitments - undrawn and contingent liabilities.

Performance March 2024 v March 2023

Performance March 2024 v September 2023

Lending volumes increased driven by home loan growth.

Lending volumes increased driven by home loan growth.

• Net interest margin decreased driven by asset margin contraction from

• Net interest margin decreased driven by asset margin contraction fromhome loan pricing competition, unfavourable deposit mix with a shifthome loan pricing competition, unfavourable deposit mix with a shift

towards lower margin term deposits, and higher net funding costs. This

towards lower margin term deposits and higher net funding costs. Thiswas partially offset by higher earnings on capital and replicating portfolio

was partially offset by favourable deposit margins, and higher earnings

and favourable lending mix with a shift towards higher margin variable

on capital and replicating portfolio.

home loans.

• Other operating income decreased driven by timing of recognition of• Operating expenses increased driven by inflationary impacts andcards incentives, and seasonality of fees.

incremental costs associated with strategic initiatives including ANZ Plus,• Operating expenses decreased driven by lower restructuring expense,

partially offset by productivity initiatives.

productivity initiatives and seasonal factors. This was partially offset by• Credit impairment charge decreased driven by lower collectively

inflationary impacts and incremental costs associated with strategic
initiatives including ANZ Plus.

assessed credit impairment, partially offset by higher individuallyassessed credit impairment due to lower write-backs in the home loan

• Credit impairment charge decreased driven by lower collectively

portfolio and lower recoveries in the unsecured portfolios.

assessed credit impairment.

48

DIVISIONAL RESULTS
Australia Retail
Maile Carnegie
Individually assessed credit impairment charge/(release)

Half Year

Home Loans

Movement

Mar 24$M
6

Sep 23$M
10

Mar 23$M-

Mar 24v. Sep 23-40%

Mar 24v. Mar 23
n/a35%

Cards and Personal Loans

42

37

31

14%

Deposits and Payments1

1

1

1

0%

0%

Individually assessed credit impairment charge/(release)

49

48

32

2%

53%

Collectively assessed credit impairment charge/(release)

Half Year

Home Loans

Movement

Mar 24$M2

Sep 23$M
12

Mar 23$M
30

Mar 24v. Sep 23-83%

Mar 24v. Mar 23-93%

Cards and Personal Loans

(11)

(8)

19

38%

large

Deposits and Payments1

3

1

1

large

large

Collectively assessed credit impairment charge/(release)

(6)

5

50

large

large

Net loans and advances

As at

Movement

Mar 24$M
316,517

Sep 23$M
306,445

Mar 23$M
294,681

Cards and Personal Loans

5,817

5,772

5,865

1%

-1%

Deposits and Payments1

30

32

35

-6%

-14%

Net loans and advances

322,364

312,249

300,5813%

7%Home Loans

Customer deposits

As at
Mar 24$M
47,692Home Loans2
Cards and Personal Loans

Sep 23$M
45,006

Mar 24v. Sep 23
3%

Mar 24v. Mar 23
7%

Movement
Mar 23$M
43,771Mar 24v. Sep 23
6%

Mar 24v. Mar 23
9%

179

219

206

-18%

-13%

Deposits and Payments

124,441

119,561

112,397

4%

11%

Customer deposits

172,312

164,786

156,374

5%

10%

1.
2.

Net loans and advances for the deposits and payments business represent amounts in overdraft.
Customer deposit amounts for the home loans business represent balances in offset accounts.

49

DIVISIONAL RESULTS
Australia Commercial
Clare Morgan
Half Year
Mar 24$M
1,580

Net interest income

Sep 23$M
1,592

Movement
Mar 23$M
1,632

Mar 24v. Sep 23-1%

Mar 24v. Mar 23
-3%
-3%

169

190

175

-11%

Operating income

1,749

1,782

1,807

-2%

-3%

Operating expenses

(763)

(738)

(685)

3%

11%

Cash profit before credit impairment and income tax

986

1,044

1,122

-6%

-12%

Credit impairment (charge)/release

(35)

(41)

(66)

-15%

-47%

Other operating income

Cash profit before income tax

951

1,003

1,056

-5%

-10%

Income tax expense

(286)

(302)

(317)

-5%

-10%

Cash profit

665

701

739

-5%

-10%

Balance Sheet
Net loans and advances

63,87461,55759,911

4%

7%

Other external assets

405

359

316

13%

28%

External assets

64,27961,91660,227

4%

7%

Customer deposits

116,463

113,408

113,011

3%

3%

5,923

5,933

6,031

0%

-2%

External liabilities

122,386

119,341

119,0423%

3%

Risk weighted assets

46,60147,49747,359-2%-2%

Other external liabilities

Average gross loans and advances

63,88061,53561,030

4%

5%

Average deposits and other borrowings

115,357

112,368

113,276

3%

2%

-21%

large

13%

-84%

5%

-9%

-2%

-5%

RatiosReturn on average assets

1.09%

1.18%

1.24%

1

Net interest margin

2.60%

2.67%

2.72%

Operating expenses to operating income

43.6%

41.4%

37.9%

Operating expenses to average assets

1.25%

1.24%

1.15%

26

33

9

0.08%

0.11%

0.03%

9

8

57

0.03%

0.03%

0.19%

261

248

288

Gross impaired assets as a % of GLA

0.40%

0.40%

0.47%

Total FTE

3,442

3,514

3,607

Individually assessed credit impairment charge/(release)
Individually assessed credit impairment charge/(release) as a % of average GLA2
Collectively assessed credit impairment charge/(release)2

Collectively assessed credit impairment charge/(release) as a % of average GLA
Gross impaired assets

1.

2.

Australia Commercial division generates positive net interest income from surplus deposits held. Accordingly, $58.1 billion of average deposits for the March 2024 half (Sep 23 half:$57.6 billion; Mar 23 half: $59.3 billion) have been included within average net interest earning assets for the net interest margin calculation to align with internal management reporting view.
Credit impairment charge/(release) used in the ratio relates to gross loans and advances and off-balance sheet commitments - undrawn and contingent liabilities.

Performance March 2024 v March 2023

Performance March 2024 v September 2023

Lending volumes increased driven by SME Banking and Specialist Business

Lending volumes increased driven by SME Banking and Specialist Business

lending growth, partially offset by lower lending in Central Functions driven bylending growth.

the sale of Investment Lending business.

• Net interest margin decreased driven by unfavourable deposit mix with a• Net interest margin decreased driven by unfavourable deposit mix with ashift towards lower margin term deposits, higher net funding costs, andshift towards lower margin term deposits, higher net funding costs, andasset margin contraction from competitive pressure. This was partiallyasset margin contraction from competitive pressure. This was partially

offset by higher earnings on capital and replicating portfolio.

offset by favourable deposit margins and higher earnings on capital and• Other operating income decreased driven by the gain on sale ofreplicating portfolio.

Investment Lending business in the September 2023 half and• Operating expenses increased driven by higher restructuring expense

seasonality of fees.

and inflationary impacts, partially offset by productivity initiatives.

• Operating expenses increased driven by higher restructuring expense• Credit impairment charge decreased driven by lower collectively

and inflationary impacts, partially offset by productivity initiatives andseasonal factors.

assessed credit impairment, partially offset by higher individuallyassessed credit impairment charge due to lower write-backs in the SME• Credit impairment charge decreased driven by lower individually

Banking portfolio.

assessed credit impairment charge due to lower impairments.

50

DIVISIONAL RESULTS
Australia Commercial
Clare Morgan
Individually assessed credit impairment charge/(release)

Half Year
Mar 24$M
28

SME Banking

Movement

Sep 23$M
32

Mar 23$M
10

Mar 24v. Sep 23-13%

Mar 24v. Mar 23
large

Specialist Business

(2)

1

(1)

large

large

Individually assessed credit impairment charge/(release)

26

33

9

-21%

large

Collectively assessed credit impairment charge/(release)

Half Year
Mar 24$M
4

Sep 23$M(18)

Specialist Business5

Collectively assessed credit impairment charge/(release)9

SME Banking

Net loans and advances

Movement
Mar 23$M
50

Mar 24v. Sep 23
large

Mar 24v. Mar 23
-92%

26

7

-81%

-29%

8

57

13%

-84%

As at

Movement

SME Banking

Mar 24$M
41,484

Sep 23$M
40,023

Mar 23$M
38,602

Mar 24v. Sep 23
4%

Mar 24v. Mar 23
7%

Specialist Business

22,052

21,05920,082

5%

10%

Central Functions
Net loans and advances

338

475

1,227

-29%

-72%

63,87461,55759,911

4%

7%

Customer deposits

As at

Movement

SME Banking

Mar 24$M
79,726

Sep 23$M
77,549Mar 23$M
76,994

Mar 24v. Sep 23
3%

Specialist Business

36,73735,85936,006

2%

2%

-

-

11

n/a

large

116,463

113,408

113,0113%

3%

Central Functions
Customer deposits

51

Mar 24v. Mar 23
4%

DIVISIONAL RESULTS
Institutional
Mark Whelan
Half Year

Movement

Net interest income

Mar 24$M
1,882

Sep 23$M
1,969

Mar 23$M
2,071

Mar 24v. Sep 23-4%

Mar 24v. Mar 23-9%

Other operating income

1,687

1,321

1,373

28%

23%

Operating income

3,569

3,290

3,444

8%

4%

Operating expenses(1,444)(1,388)(1,340)4%

8%Cash profit before credit impairment and income tax

2,125

1,902

2,104

12%

1%

6

6

74

0%

-92%
-2%

Credit impairment (charge)/releaseCash profit before income tax

2,131

1,908

2,178

12%

Income tax expense

(609)

(548)

(589)

11%

3%

Cash profit

1,522

1,360

1,589

12%

-4%

Balance Sheet
Net loans and advances

206,268

210,234

208,265-2%-1%

Other external assets

306,758

328,591

317,480-7%-3%External assets

513,026

538,825

525,745-5%-2%

Customer deposits

249,169

266,462

278,089-6%-10%

Other deposits and borrowings

70,25585,37489,429-18%-21%

Deposits and other borrowings

319,424

351,836

367,518-9%-13%

Other external liabilities

88,020100,941

83,246-13%

6%

External liabilities

407,444452,777

450,764

-10%

-10%

Risk weighted assets

171,437

175,245

183,121-2%-6%

Average gross loans and advances

207,308

206,939214,883

0%-4%

Average deposits and other borrowings

369,517355,591

355,905

4%

4%

RatiosReturn on average assets

0.52%

0.50%

0.59%

Net interest margin

0.76%

0.86%

0.91%

Net interest margin (excluding Markets business unit)

2.39%

2.36%

2.26%

Operating expenses to operating income

40.5%

42.2%

38.9%

Operating expenses to average assets

0.49%

0.51%

0.49%

(49)

30

(79)

large

-38%

(0.05%)

0.03%(0.07%)
large

large

-22%

45%

-1%

0%

Individually assessed credit impairment charge/(release)
Individually assessed credit impairment charge/(release) as a % of average GLA1
Collectively assessed credit impairment charge/(release)Collectively assessed credit impairment charge/(release) as a % of average GLA1
Gross impaired assets

43

(36)

5

0.04%

(0.03%)

0.00%

437

562

302

Gross impaired assets as a % of GLA

0.21%

0.27%

0.14%

Total FTE

6,310

6,366

6,314

1.

Credit impairment charge/(release) used in the ratio relates to gross loans and advances and off-balance sheet commitments - undrawn and contingent liabilities.

Performance March 2024 v March 2023

Performance March 2024 v September 2023

Lending volumes decreased driven by lower core lending in Corporate

Lending volumes decreased driven by lower core lending in Corporate

Finance and Transaction Banking, partially offset by higher Markets

Finance and Transaction Banking.

balances.

• Net interest margin ex-Markets increased driven by higher earnings on• Net interest margin ex-Markets increased driven by favourable deposit

capital.

margins and higher earnings on capital.

• Other operating income increased driven by higher Markets revenues• Other operating income increased driven by higher Markets revenues

from more favourable trading conditions and increased customer

from more favourable trading conditions and increased customer

activities.

activities.

• Operating expenses increased driven by inflationary impacts and higher• Operating expenses increased driven by inflationary impacts and higher

restructuring expense, partially offset by productivity initiatives.

restructuring expense, partially offset by productivity initiatives.

• Credit impairment release was flat as higher collectively assessed credit• Credit impairment release decreased driven by higher collectively

impairment was offset by lower individually assessed credit impairment

assessed credit impairment, and lower individually assessed credit

due to lower impairments and higher write-backs.

impairment release due to a large number of write-backs in the
March 2023 half.

52

DIVISIONAL RESULTS
Institutional
Mark Whelan
Institutional by Geography
Half Year
Mar 24$M
778

Australia
Net interest income
Other operating income

Sep 23$M
824

Movement
Mar 23$M844

Mar 24v. Sep 23-6%

Mar 24v. Mar 23
-8%

807

695

647

16%

25%

Operating income

1,585

1,519

1,491

4%

6%

Operating expenses

(683)

(682)

(651)

0%

5%

Cash profit before credit impairment and income tax

902

837

840

8%

7%

(4)

(17)

129

-76%

large
-7%

Credit impairment (charge)/releaseCash profit before income tax

898

820

969

10%

Income tax expense

(269)

(246)

(290)

9%

-7%

Cash profit

629

574

679

10%

-7%

Individually assessed credit impairment charge/(release)

(26)

16

(86)

large

-70%

Collectively assessed credit impairment charge/(release)

30

1

(43)

large

large

Net loans and advances

117,157

115,569

113,981

1%

3%

Customer deposits

101,486

100,526

100,559

1%

1%

Risk weighted assets

84,977

85,17086,455

0%

-2%

753

814

908

-7%

-17%
30%

International and PNG
Net interest income
Other operating income

730

476

560

53%

Operating income

1,483

1,290

1,468

15%

1%

Operating expenses

(648)

(593)

(585)

9%

11%

Cash profit before credit impairment and income tax

835

697

883

20%

-5%

Credit impairment (charge)/release

37

43

(19)

-14%

large

Cash profit before income tax

872

740

864

18%

1%

Income tax expense

(238)

(205)

(202)

16%

18%

Cash profit

634

535

662

19%

-4%

Individually assessed credit impairment charge/(release)

(13)

(3)

(5)

large

large
large

(24)

(40)

24

-40%

Net loans and advances

Collectively assessed credit impairment charge/(release)

72,08977,20276,502-7%-6%

Customer deposits

123,306

141,642

153,480

-13%

-20%

Risk weighted assets

65,14866,56872,458-2%-10%

Net interest income

351

331

319

6%

10%

Other operating income

150

150

166

0%

-10%

Operating income

501

481

485

4%

3%

Operating expenses

(113)

(113)

(104)

0%

9%

New Zealand

Cash profit before credit impairment and income tax

388

368

381

5%

2%

Credit impairment (charge)/release

(27)

(20)

(36)

35%

-25%

Cash profit before income tax

361

348

345

4%

5%

Income tax expense

(102)

(97)

(97)

5%

5%

Cash profit

259

251

248

3%

4%

Individually assessed credit impairment charge/(release)

(10)

17

12

large

large

Collectively assessed credit impairment charge/(release)

37

3

24

large

54%

Net loans and advances

17,022

17,463

17,782-3%-4%

Customer deposits

24,377

24,29424,050

0%

1%

Risk weighted assets

21,312

23,507

24,208

-9%

-12%

53

DIVISIONAL RESULTS
Institutional
Mark Whelan
Individually assessed credit impairment charge/(release)

Half Year

Movement

Transaction Banking

Mar 24$M(10)

Sep 23$M1

Mar 23$M(2)

Mar 24v. Sep 23
large

Mar 24v. Mar 23
large

Corporate Finance

(39)

29

(77)

large

-49%

-

-

-

n/a

n/a

(49)

30

(79)

large

-38%

Markets
Individually assessed credit impairment charge/(release)Collectively assessed credit impairment charge/(release)

Half Year

Transaction Banking
Corporate FinanceMovement

Mar 24$M
9

Sep 23$M(2)

Mar 23$M1

Mar 24v. Sep 23
large

Mar 24v. Mar 23
large

32

(46)

2

large

large

Markets

2

12

2

-83%

0%

Collectively assessed credit impairment charge/(release)

43

(36)

5

large

large

As at

Net loans and advances

Movement

Transaction Banking

Mar 24$M
17,666

Sep 23$M
19,597

Mar 23$M
18,732

Mar 24v. Sep 23-10%

Corporate Finance

143,440

145,472

148,520-1%-3%

Markets

45,15045,13440,9500%

10%Central Functions
Net loans and advances

12

31

63

-61%

-81%

206,268

210,234

208,265

-2%

-1%

As at

Customer deposits
Mar 24$M
149,691

Transaction Banking

Mar 24v. Mar 23-6%

Sep 23$M
152,722

Movement
Mar 23$M
148,314

Mar 24v. Sep 23-2%

Mar 24v. Mar 23
1%

Corporate Finance

1,166

1,110

1,065

5%

9%

Markets

98,202

112,566

128,414

-13%

-24%

Central Functions
Customer deposits

54

110

64

296

72%

-63%

249,169

266,462

278,089-6%-10%

DIVISIONAL RESULTS
Institutional
Mark Whelan
Transaction
Banking$M
796

March 2024 Half YearNet interest income
Other operating income

Corporate
Finance$M
1,137

Markets$M(64)

Central
Functions
$M
13

Total
$M
1,882
1,687

362

53

1,276

(4)

Operating income

1,158

1,190

1,212

9

3,569

Operating expenses

(396)

(383)

(597)

(68)

(1,444)

Cash profit/(loss) before credit impairment and income tax

762

807

615

(59)

2,125

Credit impairment (charge)/release

1

7

(2)

-

6

Cash profit/(loss) before income tax

763

814

613

(59)

2,131

Income tax expense

(207)

(224)

(171)

(7)

(609)

Cash profit/(loss)

556

590

442

(66)

1,522

Individually assessed credit impairment charge/(release)

(10)

(39)

-

-

(49)

Collectively assessed credit impairment charge/(release)

9

32

2

-

43

Net loans and advances

17,666

143,440

45,15012

206,268

Customer deposits

149,691

1,166

98,202

110

249,169

Risk weighted assets

24,84888,95556,326

1,308

171,437

753

1,153

164

1

2,071

March 2023 Half YearNet interest income
Other operating income

352

43

985

(7)

1,373

Operating income

1,105

1,196

1,149

(6)

3,444

Operating expenses

(385)

(348)

(582)

(25)

(1,340)Cash profit/(loss) before credit impairment and income tax

2,104

720

848

567

(31)

Credit impairment (charge)/release

1

75

(2)

-

74

Cash profit/(loss) before income tax

721

923

565

(31)

2,178

Income tax expense

(190)

(259)

(154)

14

(589)

Cash profit/(loss)

531

664

411

(17)

1,589

Individually assessed credit impairment charge/(release)

(2)

(77)

-

-

(79)

Collectively assessed credit impairment charge/(release)

1

2

2

-

5

Net loans and advances

18,732

148,520

40,95063

208,265

Customer deposits

148,314

1,065

128,414296

278,089

Risk weighted assets

27,71999,271

54,954

1,177

183,121

March 2024 Half Year v March 2023 Half YearNet interest income

6%

-1%

large

large

-9%

Other operating income

3%

23%

30%

-43%

23%

Operating income

5%

-1%

5%

large

4%

Operating expenses

3%

10%

3%

large

8%

Cash profit/(loss) before credit impairment and income tax

6%

-5%

8%

90%

1%

Credit impairment (charge)/release

0%

-91%

0%

n/a

-92%

Cash profit/(loss) before income tax

6%

-12%

8%

90%

-2%

Income tax expense

9%

-14%

11%

large

3%

Cash profit/(loss)

5%

-11%

8%

large

-4%

Individually assessed credit impairment charge/(release)

large

-49%

n/a

n/a

-38%

Collectively assessed credit impairment charge/(release)

large

large

0%

n/a

large

Net loans and advances

-6%

-3%

10%

-81%

-1%

Customer deposits

1%

9%

-24%

-63%

-10%

Risk weighted assets

-10%

-10%

2%

11%

-6%

55

DIVISIONAL RESULTS
Institutional
Mark Whelan
Transaction
Banking$M
796

March 2024 Half YearNet interest income
Other operating income

Corporate
Finance$M
1,137

Markets$M(64)

Central
Functions
$M
13

Total
$M
1,882
1,687

362

53

1,276

(4)

Operating income

1,158

1,190

1,212

9

3,569

Operating expenses

(396)

(383)

(597)

(68)

(1,444)

Cash profit/(loss) before credit impairment and income tax

762

807

615

(59)

2,125

Credit impairment (charge)/release

1

7

(2)

-

6

Cash profit/(loss) before income tax

763

814

613

(59)

2,131

Income tax expense

(207)

(224)

(171)

(7)

(609)

Cash profit/(loss)

556

590

442

(66)

1,522

Individually assessed credit impairment charge/(release)

(10)

(39)

-

-

(49)

Collectively assessed credit impairment charge/(release)

9

32

2

-

43

Net loans and advances

17,666

143,440

45,15012

206,268

Customer deposits

149,691

1,166

98,202

110

249,169

Risk weighted assets

24,84888,95556,326

1,308

171,437

804

1,144

20

1

1,969

September 2023 Half YearNet interest income
Other operating income

356

36

938

(9)

1,321

Operating income

1,160

1,180

958

(8)

3,290

Operating expenses

(373)

(356)

(585)

(74)

(1,388)Cash profit/(loss) before credit impairment and income tax

1,902

787

824

373

(82)

Credit impairment (charge)/release

1

17

(12)

-

6

Cash profit/(loss) before income tax

788

841

361

(82)

1,908

Income tax expense

(210)

(230)

(109)

1

(548)

Cash profit/(loss)

578

611

252

(81)

1,360

Individually assessed credit impairment charge/(release)

1

29

-

-

30

Collectively assessed credit impairment charge/(release)

(2)

(46)

12

-

(36)

Net loans and advances

19,597

145,472

45,13431

210,234

Customer deposits

152,722

1,110

112,56664

266,462

Risk weighted assets

26,247

94,31353,5201,165

175,245

March 2024 Half Year v September 2023 Half YearNet interest income

-1%

-1%

large

large

-4%

Other operating income

2%

47%

36%

-56%

28%

Operating income

0%

1%

27%

large

8%

Operating expenses

6%

8%

2%

-8%

4%

Cash profit/(loss) before credit impairment and income tax

-3%

-2%

65%

-28%

12%

Credit impairment (charge)/release

0%

-59%

-83%

n/a

0%

Cash profit/(loss) before income tax

-3%

-3%

70%

-28%

12%

Income tax expense

-1%

-3%

57%

large

11%

Cash profit/(loss)

-4%

-3%

75%

-19%

12%

Individually assessed credit impairment charge/(release)

large

large

n/a

n/a

large

Collectively assessed credit impairment charge/(release)

large

large

-83%

n/a

large

Net loans and advances

-10%

-1%

0%

-61%

-2%

Customer deposits

-2%

5%

-13%

72%

-6%

Risk weighted assets

-5%

-6%

5%

12%

-2%

56

DIVISIONAL RESULTS
Institutional
Mark Whelan
Analysis of Markets operating income1
Half Year
Composition of Markets operating income by productForeign Exchange

Movement

Mar 24$M394

Sep 23$M370

Mar 23$M407

Mar 24v. Sep 23
6%

Mar 24v. Mar 23
-3%
47%

Rates

232

189

158

23%

Credit and Capital Markets

125

76

112

64%

12%

Commodities

118

35

80

large

48%

869

670

757

30%

15%

284

270

356

5%

-20%

59

18

36

large

64%

1,212

958

1,149

27%

5%

Franchise Revenue
Balance Sheet2

Derivative valuation adjustments3
Markets operating income
1.
2.
3.

Markets operating income includes Net interest income and Other operating income.
Balance Sheet represents hedging of interest rate risk on the Group’s loan and deposit books and the management of the Group’s liquidity portfolio.
Includes funding and credit valuation adjustments net of associated hedges.

Half Year

Movement

Mar 24$M368

Sep 23$M319

Mar 23$M
310

Mar 24v. Sep 23
15%

International and PNG1

713

523

705

36%

1%

New Zealand

131

116

134

13%

-2%

1,212

958

1,149

27%

5%

Composition of Markets operating income by geography
Australia

Markets operating income1.

Comprises the countries outside of Australia and New Zealand that form part of the Institutional division. This includes Asia, Papua New Guinea, Europe & America.

57

Mar 24v. Mar 23
19%

DIVISIONAL RESULTS
Institutional
Mark Whelan
Market risk
Market risk stems from the Group’s trading and balance sheet management activities and the impact of changes and correlations between interest rates,
foreign exchange rates, credit spreads, commodities, equities and the volatility within these asset classes.
The Group manages and controls market risk using Value at Risk (VaR), sensitivity analysis and stress testing. VaR measures the Group’s possible daily
loss based on historical market movements.
The Group’s VaR approach for both traded and non-traded risk is historical simulation using changes in market rates, prices and volatilities over theprevious 500 business days to calculate standard VaR and a 1-year stressed period to calculate stressed VaR.
VaR is measured at 99% confidence interval which means there is a 99% chance that a loss will not exceed the VaR for relevant holding period.
Traded market risk
Below are aggregate VaR exposures at a 99% confidence level covering both physical and derivative trading positions for the Group’s principal trading
centres.
99% confidence level (1 day holding period)
As atHigh forhalf year

Low forhalf year

Avg forhalf year

As atHigh foryear

Low foryear

Avg foryear

Mar 24$M

Mar 24$M

Mar 24$M

Mar 24$M

Sep 23$M

Sep 23$M

Sep 23$M

Sep 23$M
3.0

Value at Risk at 99% confidence
Foreign exchange

4.2

8.2

2.2

4.4

2.8

6.2

1.6

Interest rate

14.4

19.2

5.1

9.6

6.7

18.3

5.1

8.5

Credit

7.7

8.1

4.2

6.7

5.9

7.7

2.5

4.5

Commodities

3.0

5.0

2.3

3.2

4.0

6.6

1.8

3.0

-

-

-

-

-

-

-

-

(7.2)

n/a

n/a

(10.5)

(9.7)

n/a

n/a

(8.1)

22.1

22.5

8.8

13.4

9.7

18.2

7.2

10.9

EquityDiversification benefit1
Total VaR

Non-traded interest rate risk
Non-traded interest rate risk is managed by Markets and relates to the potential adverse impact of changes in market interest rates on future net interest
income for the Group and current valuation of the banking book. Interest rate risk is reported using various techniques including VaR and scenario
analysis based on a 1% rate shock.
99% confidence level (1 day holding period)
As atHigh forhalf year

Low forhalf year

Avg forhalf year

As atHigh foryear

Low foryear

Avg foryear

Mar 24$M

Mar 24$M

Mar 24$M

Mar 24$M

Sep 23$M

Sep 23$M

Sep 23$M

Sep 23$M

Australia

78.9

79.5

72.5

76.1

81.2

93.2

72.0

82.2

New Zealand

24.7

26.4

24.7

25.8

35.3

35.3

26.1

31.1

Rest of World

35.3

38.1

29.0

34.7

32.2

32.8

23.2

27.9

Diversification benefit1(39.4)

n/a

n/a(41.8)(52.6)

n/a

n/a(45.6)

99.5

99.5

88.1

94.8

96.1

101.5

86.4

95.6

Value at Risk at 99% confidence

Total VaR

Impact of 1% rate shock on the next 12 months’ net interest income2
As at

As at period end

Mar 24
1.20%

Sep 230.96%

Maximum exposure

1.20%

1.17%

Minimum exposure

0.49%

0.38%

Average exposure (in absolute terms)

0.80%

0.80%

1.

2.

The diversification benefit reflects risks that offset across categories. The high and low VaR figures reported for each factor did not necessarily occur on the same day as the high and low
VaR reported for the Group as a whole. Consequently, a diversification benefit for high and low would not be meaningful and is therefore omitted from the table.
Modelled 1% overnight parallel positive shift in the yield curve to determine the potential impact on Net interest income over the next 12 months. This is a standard risk measure whichassumes the parallel shift is reflected in all wholesale and customer rates.

58

DIVISIONAL RESULTS
New Zealand
Antonia Watson
Table reflects NZD for New Zealand (AUD results shown on page 63)
Half Year
Mar 24
NZD M
1,692

Net interest income
Other operating income

Sep 23
NZD M
1,694

Movement
Mar 23
NZD M
1,721

Mar 24v. Sep 23
0%

Mar 24v. Mar 23
-2%

224

227

216

-1%

4%

Operating income

1,916

1,921

1,937

0%

-1%

Operating expenses

(729)

(719)

(689)

1%

6%

Cash profit before credit impairment and income tax

1,187

1,202

1,248

-1%

-5%

(4)

(40)

(82)

-90%

-95%

Credit impairment (charge)/releaseCash profit before income tax

1,183

1,162

1,166

2%

1%

Income tax expense

(331)

(325)

(327)

2%

1%

Cash profit

852

837

839

2%

2%

Balance Sheet
Net loans and advances

132,608

130,868

128,433

1%

3%

Other external assets

3,664

3,603

3,527

2%

4%

External assets

136,272

134,471

131,960

1%

3%

Customer deposits

108,789

106,431

104,614

2%

4%

Other deposits and borrowings

7,208

6,054

6,571

19%

10%

Deposits and other borrowings

115,997

112,485

111,185

3%

4%

Other external liabilities

17,35819,56518,655-11%-7%

External liabilities

133,355

132,050

129,840

1%

3%

Risk weighted assets

72,77876,19676,609-4%-5%

Average gross loans and advances

132,438

130,221129,088

2%

3%

Average deposits and other borrowings

114,514110,816

111,064

3%

3%

99

98

96

1%

3%

Funds under management

40,514

37,10836,9289%

10%

Average funds under management

38,74537,53035,8673%

8%

RatiosReturn on average assets

1.26%

1.25%

1.27%

Net interest margin

2.56%

2.60%

2.67%

Operating expenses to operating income

38.0%

37.4%

35.6%

Operating expenses to average assets

1.08%

1.08%

1.05%

14

19

10

-26%

40%

0.02%

0.03%

0.02%

(10)

21

72

large

large

(0.02%)

0.03%

0.11%

130

131

107

-1%

21%

Gross impaired assets as a % of GLA

0.10%

0.10%

0.08%

Total FTE

6,754

6,766

6,785

0%

0%

Net funds management income

Individually assessed credit impairment charge/(release)
Individually assessed credit impairment charge/(release) as a % of average GLA1
Collectively assessed credit impairment charge/(release)1

Collectively assessed credit impairment charge/(release) as a % of average GLA
Gross impaired assets

1.

Credit impairment charge/(release) used in the ratio relates to gross loans and advances and off-balance sheet commitments - undrawn and contingent liabilities.

Performance March 2024 v March 2023

Performance March 2024 v September 2023

Lending volumes increased driven by home loan growth, partially offset by

Lending volumes increased driven by home loan growth, partially offset bycontraction in business lending.

contraction in business lending.

• Net interest margin decreased driven by asset margin contraction from

• Net interest margin decreased driven by unfavourable deposit margins

home loan pricing competition, and unfavourable deposit mix with a shift

and deposit mix with a shift towards lower margin term deposits. This

towards lower margin term deposits. This was partially offset by higher

was partially offset by favourable home loan lending margins.

earnings on capital and favourable deposit margins.

• Credit impairment charge decreased driven by lower collectively• Operating expenses increased driven by inflationary pressure.

assessed credit impairment.

• Credit impairment charge decreased driven by lower collectively
assessed credit impairment.

59

DIVISIONAL RESULTS
New Zealand
Antonia Watson
Individually assessed credit impairment charge/(release)

Half Year

Personal

Movement

Mar 24
NZD M

Sep 23
NZD M

Mar 23
NZD M

Mar 24v. Sep 23

Mar 24v. Mar 23

9

11

7

-18%

29%
large

Home Loans

-

3

2

large

Other

9

8

5

13%

80%

Business & Agri

5

8

3

-38%

67%

Individually assessed credit impairment charge/(release)

14

19

10

-26%

40%

Collectively assessed credit impairment charge/(release)

Half Year

Movement

Mar 24
NZD M

Sep 23
NZD M

Mar 23
NZD M

Mar 24v. Sep 23

Mar 24v. Mar 23

13

(12)

43

large

-70%

Home Loans

18

(17)

52

large

-65%

Other

(5)

5

(9)

large

-44%

Business & Agri

(23)

33

29

large

large

Collectively assessed credit impairment charge/(release)

(10)

21

72

large

large

Personal

Net loans and advances

As at

Personal
Home Loans
Other

Movement

Mar 24
NZD M
108,721

Sep 23
NZD M
106,444

Mar 23
NZD M
103,509

Mar 24v. Sep 23
2%

Mar 24v. Mar 23
5%

107,111

104,867

101,946

2%

5%

1,610

1,577

1,563

2%

3%

Business & Agri

23,887

24,42424,924-2%-4%

Net loans and advances

132,608

130,868

128,433

1%

3%

Customer deposits

As at
Mar 24
NZD M
90,493

Personal

Sep 23
NZD M
88,086

Movement
Mar 23
NZD M
85,747

Mar 24v. Sep 23
3%

Mar 24v. Mar 23
6%

Business & Agri

18,296

18,345

18,867

0%-3%

Customer deposits

108,789

106,431

104,614

2%

4%

60

DIVISIONAL RESULTS
New Zealand
Antonia Watson

Personal
NZD M
1,170

March 2024 Half YearNet interest income

Business& Agri
NZD M
515

Central
Functions
NZD M
7

Total
NZD M
1,692

200

25

(1)

224

Operating income

1,370

540

6

1,916

Operating expenses

(590)

(134)

(5)

(729)
1,187

Other operating income

Cash profit before credit impairment and income tax

780

406

1

Credit impairment (charge)/release

(22)

18

-

(4)

Cash profit before income tax

758

424

1

1,183

Income tax expense

(213)

(119)

1

(331)

Cash profit

545

305

2

852

Individually assessed credit impairment charge/(release)

9

5

-

14

Collectively assessed credit impairment charge/(release)

13

(23)

-

(10)

Net loans and advances

108,72123,887-

132,608

Customer deposits

90,493

18,296-

108,789

Risk weighted assets

49,093

21,421

2,264

72,778March 2023 Half YearNet interest income

1,215

499

7

1,721

Other operating income

192

26

(2)

216

Operating income

1,407

525

5

1,937

Operating expenses

(568)

(119)

(2)

(689)

Cash profit before credit impairment and income tax

839

406

3

1,248

Credit impairment (charge)/release

(50)

(32)

-

(82)

Cash profit before income tax

789

374

3

1,166

Income tax expense

(221)

(105)

(1)

(327)

Cash profit

568

269

2

839
10

Individually assessed credit impairment charge/(release)

7

3

-

Collectively assessed credit impairment charge/(release)

43

29

-

72

Net loans and advances

103,50924,924-

128,433

Customer deposits

85,747

18,867-

104,614

Risk weighted assets

48,19926,251

2,159

76,609-2%

March 2024 Half Year v March 2023 Half YearNet interest income

-4%

3%

0%

Other operating income

4%

-4%

-50%

4%

Operating income

-3%

3%

20%

-1%

Operating expenses

4%

13%

large

6%

Cash profit before credit impairment and income tax

-7%

0%

-67%

-5%

Credit impairment (charge)/release

-56%

large

n/a

-95%

Cash profit before income tax

-4%

13%

-67%

1%

Income tax expense

-4%

13%

large

1%

Cash profit

-4%

13%

0%

2%

Individually assessed credit impairment charge/(release)

29%

67%

n/a

40%

Collectively assessed credit impairment charge/(release)

-70%

large

n/a

large

Net loans and advances

5%

-4%

n/a

3%

Customer deposits

6%

-3%

n/a

4%

Risk weighted assets

2%

-18%

5%

-5%

61

DIVISIONAL RESULTS
New Zealand
Antonia Watson

Personal
NZD M
1,170

March 2024 Half YearNet interest income

Business& Agri
NZD M
515

Central
Functions
NZD M
7

Total
NZD M
1,692

200

25

(1)

224

Operating income

1,370

540

6

1,916

Operating expenses

(590)

(134)

(5)

(729)

Cash profit before credit impairment and income tax

780

406

1

1,187

Credit impairment (charge)/release

(22)

18

-

(4)

Other operating income

Cash profit before income tax

758

424

1

1,183

Income tax expense

(213)

(119)

1

(331)

Cash profit

545

305

2

852

Individually assessed credit impairment charge/(release)

9

5

-

14

Collectively assessed credit impairment charge/(release)

13

(23)

-

(10)

Net loans and advances

108,72123,887-

132,608

Customer deposits

90,493

18,296-

108,789

Risk weighted assets

49,093

21,421

2,264

72,778September 2023 Half YearNet interest income

1,170

515

9

1,694

189

29

9

227

Operating income

1,359

544

18

1,921

Operating expenses

(580)

(123)

(16)

(719)

Cash profit before credit impairment and income tax

779

421

2

1,202

Other operating income

Credit impairment (charge)/release

1

(41)

-

(40)

Cash profit before income tax

780

380

2

1,162

Income tax expense

(219)

(105)

(1)

(325)

Cash profit

561

275

1

837

Individually assessed credit impairment charge/(release)

11

8

-

19

Collectively assessed credit impairment charge/(release)

(12)

33

-

21

Net loans and advances

106,444

24,424-130,868

Customer deposits

88,086

18,345-

106,431

Risk weighted assets

48,54025,5182,13876,196

March 2024 Half Year v September 2023 Half YearNet interest income

0%

0%

-22%

0%

Other operating income

6%

-14%

large

-1%

Operating income

1%

-1%

-67%

0%

Operating expenses

2%

9%

-69%

1%

Cash profit before credit impairment and income tax

0%

-4%

-50%

-1%

Credit impairment (charge)/release

large

large

n/a

-90%

Cash profit before income tax

-3%

12%

-50%

2%

Income tax expense

-3%

13%

large

2%

Cash profit

-3%

11%

large

2%

Individually assessed credit impairment charge/(release)

-18%

-38%

n/a

-26%

Collectively assessed credit impairment charge/(release)

large

large

n/a

large

Net loans and advances

2%

-2%

n/a

1%

Customer deposits

3%

0%

n/a

2%

Risk weighted assets

1%

-16%

6%

-4%

62

DIVISIONAL RESULTS
New Zealand
Antonia Watson
Table reflects AUD for New Zealand
NZD results shown on page 59
Half Year

Movement

Mar 24$M
1,572

Sep 23$M
1,567

Mar 23$M
1,582

Mar 24v. Sep 23
0%

Mar 24v. Mar 23
-1%

208

210

199

-1%

5%

Operating income

1,780

1,777

1,781

0%

0%

Operating expenses

(677)

(665)

(634)

2%

7%

Cash profit before credit impairment and income tax

1,103

1,112

1,147

-1%

-4%

Net interest income
Other operating income

Credit impairment (charge)/release

(4)

(37)

(75)

-89%

-95%

Cash profit before income tax

1,099

1,075

1,072

2%

3%

Income tax expense

(308)

(300)

(301)

3%

2%

Cash profit

791

775

771

2%

3%

Consisting of:
Personal

507

519

522

-2%

-3%

Business & Agri

283

254

247

11%

15%

Central Functions

1

2

2

-50%

-50%

791

775

771

2%

3%

121,625

121,824

120,2620%1%Cash profit
Balance Sheet
Net loans and advances

3,361

3,354

3,303

0%

2%

External assets

124,986

125,178

123,565

0%1%

Customer deposits

99,77999,076

97,9581%

2%

Other deposits and borrowings

6,611

5,635

6,153

17%

7%

Other external assets

Deposits and other borrowings

106,390

104,711104,1112%

2%

Other external liabilities

15,92018,213

17,469-13%-9%External liabilities

122,310

122,924

121,580

0%1%

Risk weighted assets

66,75070,93071,735-6%-7%

Average gross loans and advances

123,073

120,420

118,683

2%

4%

Average deposits and other borrowings

106,417

102,479

102,113

4%

4%

92

91

88

1%

5%

Funds under management

37,15934,54534,580

8%

7%

Average funds under management

36,00534,70532,975

4%

9%

RatiosReturn on average assets

1.26%

1.25%

1.27%

Net interest margin

2.56%

2.60%

2.67%

Operating expenses to operating income

38.0%

37.4%

35.6%

Operating expenses to average assets

1.08%

1.08%

1.05%

14

17

9

-18%

56%

0.02%

0.03%

0.02%
large

large

-2%

19%

0%

0%

Net funds management income

Individually assessed credit impairment charge/(release)
Individually assessed credit impairment charge/(release) as a % of average GLA1
Collectively assessed credit impairment charge/(release)Collectively assessed credit impairment charge/(release) as a % of average GLA1
Gross impaired assets

(10)

20

66

(0.02%)

0.03%

0.11%

119

122

100

Gross impaired assets as a % of GLA

0.10%

0.10%

0.08%

Total FTE

6,754

6,766

6,785

1.

Credit impairment charge/(release) used in the ratio relates to gross loans and advances and off-balance sheet commitments - undrawn and contingent liabilities.

63

DIVISIONAL RESULTS
Pacific
Antonia Watson
Movement

Half Year
Mar 24$M
63

Net interest income

Sep 23$M
61

Mar 23$M
62

Mar 24v. Sep 23
3%

Mar 24v. Mar 23
2%
10%

Other operating income

44

45

40

-2%

Operating income

107

106

102

1%

5%

Operating expenses

(70)

(71)

(74)

-1%

-5%

Cash profit/(loss) before credit impairment and income tax

37

35

28

6%

32%

Credit impairment (charge)/release

6

12

16

-50%

-63%

Cash profit/(loss) before income tax

43

47

44

-9%

-2%

Income tax expense

(11)

(8)

(10)

38%

10%

Non-controlling interests

(1)

(2)

-

-50%

n/a

Cash profit/(loss)

31

37

34

-16%

-9%

Balance Sheet
Net loans and advances

1,678

1,684

1,661

0%

1%

Customer deposits

3,657

3,719

3,562

-2%

3%

Risk weighted assets

3,620

3,772

4,131

-4%

-12%

972

1,013

1,037

-4%

-6%

Total FTEGroup Centre
Movement

Half Year
Mar 24$M

Sep 23$M

Mar 23$M

Mar 24v. Sep 23

Mar 24v. Mar 23

Share of associates' profit/(loss)

84

120

101

-30%

-17%

Operating income (other)

149

222

(6)

-33%

large

Operating income1

233

342

95

-32%

large

Operating expenses

(526)

(522)

(561)

1%

-6%

Cash profit/(loss) before credit impairment and income tax

(293)

(180)

(466)

63%

-37%

Credit impairment (charge)/release

-

1

-

large

n/a

Cash profit/(loss) before income tax

(293)

(179)

(466)

64%

-37%

Income tax benefit

55

28

112

96%

-51%

Non-controlling interests

(13)

(12)

(14)

8%

-7%

Cash profit/(loss)

(251)

(163)

(368)

54%

-32%

Risk weighted assets

14,187

8,210

11,32473%

25%

Total FTE

11,401

11,37010,8600%

5%

1.

The March 2024 half includes the loss on partial disposal of investment in AmBank of $21 million.

64

PROFIT RECONCILIATIONCONTENTS

Page

Adjustments between statutory profit and cash profit

66

Explanation of adjustments between statutory profit and cash profit

66

Reconciliation of statutory profit to cash profit

67

65

PROFIT RECONCILIATION
Non-IFRS information
Statutory profit is prepared in accordance with the recognition and measurement requirements of Australian Accounting Standards, which comply with
International Financial Reporting Standards (IFRS). The Group provides additional measures of performance in the Results Announcement which areprepared on a basis other than in accordance with accounting standards. The guidance provided in ASIC Regulatory Guide 230 has been followed whenpresenting this information.

Adjustments between statutory profit and cash profit
Cash profit represents the Group’s preferred measure of the result of the core business activities of the Group, enabling readers to assess Group anddivisional performance against prior periods and against peer institutions. To calculate cash profit, the Group excludes non-core items from statutory
profit (refer to Definitions on pages 123 to 125 for further details). The adjustments made in arriving at cash profit are included in statutory profit which is
subject to review within the context of the external auditor’s review of the Condensed Consolidated Financial Statements. Cash profit is not subject toreview by the external auditor. The external auditor has informed the Audit Committee that cash profit adjustments have been determined on a consistentbasis across each period presented.
Half Year

Movement

Mar 24$M

Sep 23$M

Mar 23$M

Mar 24v. Sep 23

Mar 24v. Mar 23

3,407

3,551

3,555

-4%

-4%

Economic hedges

197

27

190

large

4%

Revenue and expense hedges

(52)

6

84

large

large

145

33

274

large

-47%

3,552

3,584

3,829

-1%

-7%

Statutory profit attributable to shareholders of the Company

Adjustments between statutory profit and cash profit

Total adjustments between statutory profit and cash profit
Cash profit

Explanation of adjustments between statutory profit and cash profit•

Economic hedges
The Group enters into economic hedges to manage its interest rate and foreign exchange risk which, in accordance with accounting standards, resultin fair value gains and losses being recognised in the Income Statement. This includes gains and losses arising from approved classes of derivatives
not designated in accounting hedge relationships but which are considered to be economic hedges, as well as ineffectiveness from designatedaccounting hedges.
Economic hedges comprise:•

Derivatives (primarily cross currency interest rate swaps) used to convert the proceeds of foreign currency debt issuances into floating rate
Australian dollar and New Zealand dollar debt that do not qualify for hedge accounting. The main drivers of these fair value movements are
currency basis spreads and Australian dollar and New Zealand dollar fluctuations against other major funding currencies.

•

Economic hedges of select structured finance and specialised leasing transactions that do not qualify for hedge accounting. The main drivers ofthese fair value adjustments are movements in the Australian and New Zealand term structure of interest rates.

•

Ineffectiveness arising from differences in certain factors between the hedged items and the hedging instruments.

The Group removes the fair value adjustments from cash profit since the profit or loss will reverse over time to match with the profit or loss from theunderlying hedged item.
In the March 2024 half, losses on economic hedges relate to funding-related swaps, principally from narrowing USD/EUR currency basis spreads.
Further losses were driven by the yield curve movement impact on net pay fixed economic hedge positions.
•

Revenue and expense hedges
The Group enters into economic hedges to manage exposures from larger foreign exchange denominated revenue and expense streams, primarily
NZD and USD (and USD correlated). The gain on revenue and expense hedges in the March 2024 half was mainly due to the appreciation of AUD
against the NZD.

66

PROFIT RECONCILIATION
Reconciliation of statutory profit to cash profit
Adjustments to statutory profit

Statutory profit

Economic
hedges

Revenue andexpensehedgesTotal
adjustments tostatutory profit

Cash profit

$M

$M

$M

$M

$M
7,899

March 2024 Half YearNet interest income

7,899

-

-

-

Other operating income

2,246

277

(75)

202

2,448

Operating income

10,145

277

(75)

202

10,347

Operating expenses(5,215)---(5,215)

Profit before credit impairment and tax

4,930

277

(75)

202

5,132

(70)

-

-

-

(70)

Profit before income tax

4,860

277

(75)

202

5,062

Income tax expense(1,439)

(80)

23

(57)

(1,496)

(14)

-

-

-

(14)

3,407

197

(52)

145

3,552

Credit impairment (charge)/releaseNon-controlling interests
ProfitSeptember 2023 Half YearNet interest income

8,074

-

-

-

8,074

Other operating income

2,246

36

9

45

2,291

Operating income

10,32036

945

10,365

Operating expenses(5,142)---(5,142)

Profit before credit impairment and tax

5,178

36

9

45

5,223

Credit impairment (charge)/release

(112)

-

-

-

(112)

Profit before income tax

5,066

36

9

45

5,111

Income tax expense(1,501)

(9)

(3)

(12)

(1,513)

(14)

-

-

-

(14)

3,551

27

6

33

3,584

8,500

-

-

-

8,500

Non-controlling interests
ProfitMarch 2023 Half YearNet interest income
Other operating income

1,651

269

120

389

2,040

Operating income

10,151

269

120

389

10,540Operating expenses(4,997)---(4,997)

Profit before credit impairment and tax

5,154

269

120

389

5,543

Credit impairment (charge)/release

(133)

-

-

-

(133)

Profit before income tax

5,021

269

120

389

5,410

Income tax expense(1,452)

(79)

(36)

(115)

(1,567)

(14)

-

-

-

(14)

3,555

190

84

274

3,829

Non-controlling interests
Profit67

PROFIT RECONCILIATIONThis page has been left blank intentionally

68

CONDENSED CONSOLIDATED FINANCIAL STATEMENTSCONTENTS

Page

Directors’ Report70

Condensed Consolidated Income Statement71

Condensed Consolidated Statement of Comprehensive Income

72

Condensed Consolidated Balance Sheet73

Condensed Consolidated Cash Flow Statement74

Condensed Consolidated Statement of Changes in Equity

75

Notes to Condensed Consolidated Financial Statements

76

Directors’ Declaration

110

Auditor’s Review Report and Independence Declaration

111

69

DIRECTORS’ REPORTThe Directors present their report for ANZ Group Holdings Limited (the Company) for the half year ended 31 March 2024, together with the Condensed
Consolidated Financial Statements of the Group.
Directors
The names of the Directors of the Company who held office during and since the end of the half year are:
Mr PD O’Sullivan

Chairman

Mr SC Elliott

Director and Chief Executive Officer

Ms IR Atlas, AO

Director, ceased 21 December 2023

Mr RBM Gibb

Director, appointed 15 February 2024

Ms SJ Halton, AO PSM

Director

Rt Hon Sir JP Key, GNZM AC

Director, ceased 14 March 2024

Ms HS Kramer

Director

Mr JT Macfarlane

Director, ceased 21 December 2023

Ms CE O’Reilly

Director

Mr JP Smith

Director

Mr SA St John

Director, appointed 25 March 2024

Result
The consolidated profit attributable to shareholders of the Company was $3,407 million. Further details are contained in Group Results on pages 13 to 42
which forms part of this report, and in the Condensed Consolidated Financial Statements.
Review of operations
A review of the operations of the Group during the half year and the results of those operations are contained in the Group Results on pages 13 to 42
which forms part of this report.
Lead auditor’s independence declaration
The lead auditor’s independence declaration given under section 307C of the Corporations Act 2001 (as amended) is set out on page 112 which forms
part of this report.
Rounding of amounts
The amounts contained in this Directors’ Report and the accompanying Condensed Consolidated Financial Statements have been rounded to the nearest
million dollars, except where otherwise indicated, as permitted by ASIC Corporations Instrument 2016/191.
Significant events since balance date
There have been no significant events from 31 March 2024 to the date of signing this report.
Signed in accordance with a resolution of the Directors.

Paul D O’Sullivan
ChairmanShayne C ElliottManaging Director

6 May 2024

70

CONDENSED CONSOLIDATED INCOME STATEMENTANZ Group Holdings Limited
Half Year
Note
Interest income
Interest expense

Movement

Mar 24$M
29,811

Sep 23$M
27,072

Mar 23$M
22,832

Mar 24v. Sep 23
10%

Mar 24v. Mar 23
31%
53%(21,912)(18,998)(14,332)

15%

Net interest income

2

7,899

8,074

8,500

-2%

-7%

Other operating income

2

2,114

2,073

1,495

2%

41%

2

48

53

55

-9%

-13%

2, 16

84

120

101

-30%

-17%

10,145

10,320

10,151-2%

0%(5,215)(5,142)(4,997)

1%

4%

4,930

5,178

5,154

-5%

-4%

Net income from insurance business
Share of associates' profit/(loss)
Operating income
Operating expenses

3

Profit before credit impairment and income tax
Credit impairment (charge)/release

9

Profit before income tax
Income tax expense

4

Profit for the period

(70)

(112)

(133)

-38%

-47%

4,860

5,066

5,021

-4%

-3%

(1,439)(1,501)(1,452)

-4%

-1%

3,421

3,565

3,569

-4%

-4%

Comprising:
Profit attributable to shareholders of the Company

3,407

3,551

3,555

-4%

-4%

14

14

14

14

0%

0%

Basic

6

113.5

118.4

118.7

-4%

-4%

Diluted

6

111.5

113.8

113.0

-2%

-1%

5

83

94

81

-12%

2%

Profit attributable to non-controlling interests
Earnings per ordinary share (cents)

Dividend per ordinary share (cents)

The notes appearing on pages 76 to 109 form an integral part of the Condensed Consolidated Financial Statements.

71

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

ANZ Group Holdings Limited
Half Year
Mar 24$M
3,421

Profit for the period

Sep 23$M
3,565

Movement
Mar 23$M
3,569

Mar 24v. Sep 23-4%

Mar 24v. Mar 23-4%

Other comprehensive income

Items that will not be reclassified subsequently to profit or loss
Investment securities - equity securities at FVOCI

(3)

(89)

62

-97%

large

Other reserve movements1

(59)

(46)

(34)

28%

74%

large

Items that may be reclassified subsequently to profit or loss
Foreign currency translation reserve

(378)

(74)

792

large

Cash flow hedge reserve

1,075

(832)

1,067

large

1%

Other reserve movements

(128)

(42)

6

large

large

Income tax attributable to the above items

(268)

283

(306)

large

-12%

Share of associates' other comprehensive income2

(17)

23

8

large

large

3,643

2,788

5,164

31%

-29%

3,640

2,777

5,120

31%

-29%

3

11

44

-73%

-93%

Total comprehensive income for the period
Comprising total comprehensive income attributable to:Shareholders of the Company
Non-controlling interests
1.
2.

1

Includes foreign currency translation differences attributable to non-controlling interest of -$11 million (Sep 23 half: -$3 million; Mar 23 half: $30 million).
Share of associates’ other comprehensive income includes:
Mar 24 half$M

Sep 23 half$M

Mar 23 half
$M

FVOCI reserve gain/(loss)

(4)

23

2

Defined benefits gain/(loss)

(13)

-

6

Total

(17)

23

8

The notes appearing on pages 76 to 109 form an integral part of the Condensed Consolidated Financial Statements.

72

CONDENSED CONSOLIDATED BALANCE SHEETANZ Group Holdings Limited
As at
AssetsCash and cash equivalents1

Note

Movement

Mar 24$M
137,699

Sep 23$M
168,154

Mar 23$M
208,800

Mar 24v. Sep 23-18%

Mar 24v. Mar 23
-34%

3,809

9,349

7,020

-59%

-46%
-11%

Settlement balances owed to ANZCollateral paid

8,241

8,558

9,245

-4%

Trading assets

42,44237,00439,61115%

7%

Derivative financial instruments

47,48160,40645,614-21%

4%Investment securities
Net loans and advances

8

118,055

97,42993,97221%

26%715,171707,044690,0871%

4%

Regulatory deposits
Investments in associates

696

646

646

8%

8%

1,419

2,349

2,253

-40%

-37%
large

Current tax assets

294

114

49

large

Deferred tax assets

3,149

3,348

2,974

-6%

6%

Goodwill and other intangible assets

3,998

4,058

4,037

-1%

-1%

Premises and equipment

2,005

2,053

2,289

-2%

-12%

Other assets

5,240

5,131

4,640

2%

13%

Total assets

1,089,699

1,105,643

1,111,237

-1%

-2%

15,026

19,26723,010-22%-35%

Liabilities
Settlement balances owed by ANZ
Collateral received
Deposits and other borrowings

10

Derivative financial instruments

7,409

10,382

8,002

-29%

-7%

806,737

814,711

842,564-1%-4%42,72857,482

46,154-26%-7%

Current tax liabilities

201

305

347

-34%

-42%

Deferred tax liabilities

78

82

79

-5%

-1%

17,09415,097

13,057

13%

31%

580

569

593

2%

-2%

1,663

1,717

1,694

-3%

-2%

Payables and other liabilities
Employee entitlements
Other provisions
Debt issuances11

Total liabilities
Net assets

127,109

116,014106,15710%20%

1,018,625

1,035,626

1,041,657

-2%

-2%

71,07470,017

69,5802%

2%

Shareholders' equity
Ordinary share capital

14

29,03329,082

29,0540%0%

Reserves

14(1,466)(1,735)(1,019)-16%

44%

Retained earnings

14

42,73942,14841,0201%

4%70,30669,49569,055

1%

2%

768

522

525

47%

46%

71,07470,017

69,5802%

2%

Share capital and reserves attributable to shareholders of the Company
Non-controlling interests

14

Total shareholders' equity
1.

Includes Settlement balances owed to ANZ that meet the definition of Cash and cash equivalents.

The notes appearing on pages 76 to 109 form an integral part of the Condensed Consolidated Financial Statements.

73

CONDENSED CONSOLIDATED CASH FLOW STATEMENTANZ Group Holdings Limited
Half Year

Profit after income tax

Mar 24$M
3,421

Sep 23$M
3,565

Mar 23
$M
3,569

70
445

112
452

133
471

Adjustments to reconcile to net cash flow from operating activities:
Allowance for expected credit losses
Depreciation and amortisation
Loss on reclassification of data centres to held for saleNet derivatives/foreign exchange adjustment

-

-

43

858

(1,912)

5,417(Gain)/loss on sale from divestments

21

(29)

-

Other non-cash movements1

(10)

(71)

(3)

262

958

3,185

Net (increase)/decrease in operating assets:
Collateral paid
2

(20)

384

(6,272)(10,665)(16,300)(11,339)

(587)

(480)

(1,226)

Deposits and other borrowings(4,492)(19,790)

41,391

Settlement balances owed by ANZ(4,178)(3,775)

9,053

Collateral received(2,897)2,044(7,892)Other liabilities2

2,175

1,873

2,927

Total adjustments(19,018)(36,534)

35,888Net cash (used in)/provided by operating activities3(15,597)(32,969)

39,457Purchases(43,900)(38,477)(13,553)

Proceeds from sale or maturity

22,99635,969

5,432

668

558

-

-

-

(10)

Trading assets

Net loans and advances1
Other assets1
Net increase/(decrease) in operating liabilities:

Cash flows from investing activities
Investment securities assets:

Proceeds from divestments, net of cash disposed
Net movement in shares in controlled entities

(451)

(255)

(350)

(20,687)(2,205)(8,481)(27)(12,042)937

Issue proceeds

26,24019,141

25,041

Redemptions(16,639)(9,296)(14,689)

Dividends paid5(1,979)Net investments in other assets
Net cash (used in)/provided by investing activities
Cash flows from financing activities
Deposits and other borrowings (repaid) / drawn down
Debt issuances:4(2,784)(2,401)

On market purchase of treasury shares

(126)

(2)

(19)

Repayment of lease liabilities

(142)

(150)

(156)

ANZ Bank New Zealand Perpetual Preference Shares

252

-

-

Net cash (used in)/provided by financing activities

6,774(4,750)9,135

Net increase/(decrease) in cash and cash equivalents(29,510)(39,924)

40,111

Cash and cash equivalents at beginning of period

168,154

208,800

168,132

Effects of exchange rate changes on cash and cash equivalents
Cash and cash equivalents at end of period
1.

(945)

(722)

557

137,699

168,154

208,800

Certain items were reclassified from Other non-cash movements to Net loans and advances and Other assets in the September 2023 half to better reflect the net movement in operating
assets. Comparatives have been restated (Mar 23 half: reduction to Other non-cash movements of $751 million, an increase in Net loans and advances of $112 million, and an increase in
Other assets of $639 million).
2. Certain items were reclassified from Other liabilities to Trading assets in the March 2024 half to better reflect the movement in operating assets and operating liabilities. Comparatives havebeen restated (Sep 23 half: reduction to Trading assets and an increase in Other liabilities of $1,866 million; Mar 23 half: reduction to Trading assets and an increase to Other liabilities of$3,999 million).
3. Net cash (used in)/provided by operating activities includes interest received of $29,336 million (Sep 23 half: $26,266 million; Mar 23 half: $22,079 million), interest paid of $21,272 million(Sep 23 half: $17,990 million; Mar 23 half: $12,717 million) and income taxes paid of $1,779 million (Sep 23 half: $1,674 million; Mar 23 half: $1,827 million).
4. Non-cash changes in debt issuances include a loss of $1,494 million (Sep 23 half: $12 million loss; Mar 23 half: $2,072 million loss) from unrealised movements primarily due to fair value
hedge adjustments and foreign exchange differences.
5. Cash outflow for shares purchased to satisfy the dividend reinvestment plan (DRP) are classified in dividends paid.
The notes appearing on pages 76 to 109 form an integral part of the Condensed Consolidated Financial Statements.

74

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITYANZ Group Holdings Limited

As at 1 October 2022

Ordinary
share
capital$M

Reserves$M

Retainedearnings$M

Share capitaland reserves
attributable toshareholders of
the Company$M

Noncontrollinginterests$M

Total
shareholders'equity$M66,401

28,797(2,606)

39,71665,907494

Impact on transition to AASB 17

-

-

(37)

(37)

-

(37)

Profit/(Loss) for the period

-

-

3,555

3,555

14

3,569

Other comprehensive income for the period

-

1,607

(42)

1,565

30

1,595

Total comprehensive income for the period

-

1,607

3,513

5,120

44

5,164

Transactions with equity holders in their capacity as equity holders:
Dividends paid
Dividend reinvestment plan1--(2,172)(2,172)(13)(2,185)

206

-

-

206

-

206

53

-

-

53

-

53

Other equity movements:
Employee share and option plans
Other items
As at 31 March 2023

(2)

(20)

-

(22)

-

(22)

29,054(1,019)41,02069,055525

69,5803,565

Profit/(Loss) for the period

-

-

3,551

3,551

14

Other comprehensive income for the period

-

(742)

(32)

(774)

(3)

(777)

Total comprehensive income for the period

-

(742)

3,519

2,777

11

2,788

Dividends paid--

(2,387)(2,387)(14)(2,401)Dividend reinvestment plan1

-

-

-

-

-

-

26

-

-

26

-

26

Transactions with equity holders in their capacity as equity holders:

Other equity movements:
Employee share and option plans
Other items
As at 30 September 2023

2

26

(4)

24

-

24

29,082(1,735)42,14869,495522

70,017

Profit/(Loss) for the period

-

-

3,407

3,407

14

3,421

Other comprehensive income for the period

-

281

(48)

233

(11)

222

Total comprehensive income for the period

-

281

3,359

3,640

3

3,643

Dividends paid--

(2,771)(2,771)(13)(2,784)

Dividend reinvestment plan1

-

-

-

-

-

-

(49)

-

-

(49)

-

(49)

-

-

(4)

(4)

256

252

Transactions with equity holders in their capacity as equity holders:

Other equity movements:
Employee share and option plans
ANZ Bank New Zealand Perpetual Preference Shares2
Other items
As at 31 March 2024
1.

2.

-

(12)

7

(5)

-

(5)

29,033(1,466)42,73970,306768

71,074No shares were issued under the dividend reinvestment plan for the 2023 final and interim dividend (2022 final dividend: 8.4 million). On-market share purchases for the DRP were$211 million in the March 2024 half (Sep 23 half: $326 million; Mar 23 half: nil).
Perpetual preference shares issued by ANZ Bank New Zealand Limited, a member of the Group, are considered non-controlling interest to the Group. Refer to Note 14 Shareholders’ equity
for further details.

The notes appearing on pages 76 to 109 form an integral part of the Condensed Consolidated Financial Statements.

75

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1.

Basis of preparation

These Condensed Consolidated Financial Statements:•

have been prepared in accordance with the recognition and measurement requirements of Australian Accounting Standards;•

should be read in conjunction with ANZGHL’s Annual Financial Report for the year ended 30 September 2023 and any public announcements madeby ANZGHL and its controlled entities (the Group) for the half year ended 31 March 2024 in accordance with the continuous disclosure obligations
under the Corporations Act 2001 and the ASX Listing Rules;•

do not include all notes of the type normally included in the 2023 ANZGHL Annual Report;•

are presented in Australian dollars unless otherwise stated; and•were approved by the Board of Directors on 6 May 2024.

i)Statement of Compliance

These Condensed Consolidated Financial Statements have been prepared in accordance with the Corporations Act 2001 and AASB 134 Interim
Financial Reporting which ensured compliance with IAS 34 Interim Financial Reporting.
ii) Rounding of amounts
The amounts contained in these Condensed Consolidated Financial Statements have been rounded to the nearest million dollars, except whereotherwise indicated, as permitted by Australian Securities and Investments Commission Corporations Instrument 2016/191.
iii) Basis of measurement and presentation
The financial information has been prepared in accordance with the historical cost basis except the following assets and liabilities that are stated at theirfair values:•

derivative financial instruments and in the case of fair value hedging, a fair value adjustment made to the underlying hedged item;•

financial instruments held for trading;•financial instruments designated at fair value through profit and loss (FVTPL);•

financial assets at fair value through other comprehensive income (FVOCI).

In accordance with AASB 119 Employee Benefits, defined benefit obligations are measured using the Projected Unit Credit method.
iv) Accounting policies
These Condensed Consolidated Financial Statements have been prepared on the basis of accounting policies and using methods of computationconsistent with those applied in the 2023 ANZGHL Annual Report, except as outlined below.
Accounting standards adopted during the period
AASB 17 Insurance Contracts
On 1 October 2023, the Group adopted AASB 17 Insurance Contracts (AASB 17) which established principles for the recognition, measurement,
presentation, and disclosure of insurance contracts, and replaced AASB 4 Insurance Contracts and AASB 1023 General Insurance Contracts. Although
the overall profit recognised in respect of insurance contracts will not change over the life of contracts, the timing of revenue recognition will change.
The Group applied AASB 17 effective from 1 October 2022 and restated prior period comparative information. This resulted in a decrease in opening
retained earnings of $37 million on 1 October 2022, an increase in profit after tax (Sep 23 half: nil; Mar 23 half: $8 million), an increase in total assets(Sep 23: $22 million; Mar 23: $36 million), and an increase in total liabilities (Sep 23: $51 million; Mar 23: $65 million) in the Australia Retail division. The
impact on earnings per share was not material. These adjustments were primarily driven by the impact of changes in the pattern of recognition of revenue
on insurance contracts issued, changes in the pattern of recognition of the net cost of reinsurance and the valuation of profit commissions on reinsurance
contracts held.

76

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1.

Basis of preparation, cont’dv) Use of estimates, assumptions and judgements
The preparation of these Condensed Consolidated Financial Statements requires the use of management judgement, estimates and assumptions
impacting the application of accounting policies and financial outcomes. Discussion of the critical accounting estimates and judgements, which include
complex or subjective decisions or assessments are provided in the 2023 ANZGHL Annual Report. Such estimates and judgements are reviewed on an
ongoing basis.
The global economy continues to face challenges associated with inflation and interest rate uncertainties, labour market constraints, continuing
geopolitical tensions, and impacts from climate change, which contributes to an elevated level of estimation uncertainty involved in the preparation ofthese financial statements.
The Group made various accounting estimates in these Condensed Consolidated Financial Statements based on forecasts of economic conditions whichreflect expectations and assumptions at 31 March 2024 about future events considered reasonable in the circumstances. Thus there is a considerable
degree of judgement involved in preparing these estimates. Actual economic conditions are likely to be different from those forecast since anticipated
events frequently do not occur as expected, and the effect of these differences may significantly impact accounting estimates included in these financial
statements. The significant accounting estimates impacted by these forecasts and associated uncertainties are predominantly related to expected credit
losses and recoverable amounts of non-financial assets.
The impact of these uncertainties on each of these accounting estimates is discussed further below, along with assumptions and judgements made in
relation to other key estimates. Readers should consider these disclosures in light of the inherent uncertainties described above.
Allowance for expected credit losses
The Group measures the allowance for expected credit losses (ECL) using an expected credit loss impairment model as required by AASB 9 Financial
Instruments.
The Group’s allowance for ECL is included in the table below (refer to Note 9 for further information).
As at
Mar 24$M

Sep 23$M

Mar 23$M

Collectively assessed

4,046

4,032

4,040

Individually assessed

325

376

421

4,371

4,408

4,461

1

Total
1.

Includes allowance for ECL for Net loans and advances - at amortised cost, Investment securities - debt securities at amortised cost and Off-balance sheet commitments - undrawn andcontingent facilities.

Individually assessed allowance for ECL
During the March 2024 half, the individually assessed allowance for ECL decreased $51 million.
In estimating individually assessed ECL, the Group makes judgements and assumptions in relation to expected repayments, the realisable value ofcollateral, business prospects for the customer, competing claims and the likely cost and duration of the work-out process.
Collectively assessed allowance for ECL
During the March 2024 half, the collectively assessed allowance for ECL increased $14 million, attributable to $169 million from deterioration in credit risk
profile across all divisions, $63 million from portfolio growth, and $5 million from deterioration in economic outlook. This was partially offset by
a $205 million reduction in management temporary adjustments, as anticipated risks are now represented in portfolio credit profiles, and $18 million fromforeign currency translation and other impacts.
In estimating collectively assessed ECL, the Group makes judgements and assumptions in relation to:•

the selection of an estimation technique or modelling methodology; and•the selection of inputs for those models, and the interdependencies between those inputs.

The judgements and associated assumptions have been made within the context of the uncertainty of how various factors might impact the global
economy, and reflect historical experience and other factors that are considered relevant, including expectations of future events that are believed to bereasonable under the circumstances. The Group’s ECL estimates are inherently uncertain and, as a result, actual results may differ from these estimates.

77

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1.

Basis of preparation, cont’d

The following table summarises the key judgements and assumptions in relation to the model inputs and the interdependencies between those inputs,
and highlights significant changes during the current period.
Judgement/Assumption

Description

Considerations for the half year ended 31 March 2024

Determining when asignificant increase incredit risk (SICR) has
occurred or reversed

In the measurement of ECL, judgement is involved indetermining whether there has been a SICR since initialrecognition of a loan, which would result in it moving from
Stage 1 to Stage 2. This is a key area of judgement sincetransition from Stage 1 to Stage 2 increases the ECL froman allowance based on the PD in the next 12 months, toan allowance for lifetime ECL. Subsequent decreases incredit risk resulting in transition from Stage 2 to Stage 1
may similarly result in significant changes in the ECL
allowance. The setting of precise SICR trigger points
requires judgement which may have a material impact
upon the size of the ECL allowance. The Group monitors
the effectiveness of SICR criteria on an ongoing basis.

The determination of SICR was consistent with priorperiods.

Measuring both 12month and lifetime ECL

The PD, LGD and EAD factors used in determining ECL
are point-in-time measures reflecting the relevant forwardlooking information determined by management.
Judgement is involved in determining which forwardlooking information is relevant for particular lending
portfolios and for determining each portfolio’s point-in-time
sensitivity. In addition, judgement is required where
behavioural characteristics are applied in estimating the
lifetime of a facility which is used in measuring ECL.

The PD, LGD and EAD models are subject to the Group’smodel risk policy that stipulates periodic model monitoring
and re-validation, and defines approval procedures andauthorities according to model materiality.

The Group derives a forward-looking ‘base case’economic scenario which reflects ANZ Economics view of
future macroeconomic conditions.

There have been no changes to the types of forwardlooking variables (key economic drivers) used as model
inputs.

Base case economic
forecast

There were no material changes to the policy.
A new PD model was implemented for the New Zealandagri portfolio during the period replacing the prior model,
with impacts largely offset by the release of a model
overlay held in anticipation of model implementation.

As at 31 March 2024, the base case assumptions havebeen updated to reflect a moderation in inflation andslowing employment growth in both Australia and New
Zealand. Both economies are forecast to continue to growbelow trend. Despite increased household disposable
incomes, limited flow-through to household consumption is
forecast.
The expected outcomes of key economic drivers for thebase case scenario at 31 March 2024 are described below
under the heading “Base case economic forecast
assumptions”.
Probability weighting ofeach economic
scenario (base case,upside, downside andsevere downside
scenarios)1

Management temporary
adjustments

1.

Probability weighting of each economic scenario is
determined by management considering the risks anduncertainties surrounding the base case economic
scenario at each measurement date.
The assigned probability weightings in Australia, New
Zealand and Rest of World are subject to a high degree of
inherent uncertainty and therefore the actual outcomesmay be significantly different to those projected.
Management temporary adjustments to the ECL allowance
are used in circumstances where it is judged that ourexisting inputs, assumptions and model techniques do not
capture all the risk factors relevant to our lending
portfolios. Emerging local or global macroeconomic,
microeconomic or political events, and natural disasters
that are not incorporated into our current parameters, risk
ratings, or forward-looking information are examples ofsuch circumstances.

Probability weightings in the current period remainunchanged in each geography from the prior period,
reflecting our assessment of the continuing downside risks
from the impact of high interest rates and inflation in theeconomies in which the Group operates.
Weightings for current and prior periods are as detailed in
the section below under the heading on ‘Probability
weightings’.
Management have continued to apply adjustments toaccommodate uncertainty associated with higher inflationand interest rates. Management overlays have been madefor risks particular to home loans, credit cards andcommercial lending in Australia, and for mortgages andcommercial lending in New Zealand. The total amount ofadjustments has reduced from the prior period.
Management has considered and concluded no temporary
adjustment is required at 31 March 2024 to the ECL in
relation to climate- or weather-related events during theperiod.

The upside and downside scenarios are fixed by reference to average economic cycle conditions instead of economic conditions prevailing at balance date, and are based on a combinationof more optimistic (in the case of the upside) and pessimistic (in the case of the downside) economic conditions.

78

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1.

Basis of preparation, cont’dBase case economic forecast assumptions
The economic drivers of the base case economic forecasts, reflective of ANZ Economics’ view of future macro-economic conditions, used at 31 March2024 are set out below. For years beyond the near-term forecasts below, the ECL models apply simplified assumptions for the economic conditions to
calculate lifetime loss. There is a high level of estimation uncertainties when forming these forecasts.
Actual calendar year

Forecast calendar year

2023

2024

2025

GDP (annual % change)

2.0

1.3

2.0

Unemployment rate (annual average)

3.7

4.1

4.3

Residential property prices (annual % change)

9.1

5.7

5.0

Consumer price index (annual % change)

5.6

3.2

2.8

1.3

Australia

New Zealand
GDP (annual % change)

0.8

0.9

Unemployment rate (annual average)

3.7

4.5

5.3

Residential property prices (annual % change)

(0.7)

3.0

5.0

Consumer price index (annual % change)

5.7

3.1

2.2

GDP (annual % change)

2.5

1.4

1.8

Consumer price index (annual % change)

4.1

2.7

2.2

Rest of WorldThe base case economic forecasts for Australia, New Zealand and Rest of World are for continuing slowdowns in economic activity. Continued highinflation in Australia and New Zealand is expected to keep interest rates high for longer and dampen growth over the forecast period.
Probability weightings
Probability weightings for each scenario are determined by management considering the risks and uncertainties surrounding the base case economic
scenario including the uncertainties described above.
Scenario weightings remain the same as those applied in September 2023 as noted in the table below.
The assigned probability weightings in Australia, New Zealand and Rest of World are subject to a high degree of inherent uncertainty and therefore theactual outcomes may be significantly different to those projected. The Group considers these weightings in each geography to provide estimates of thepossible loss outcomes and taking into account short and long term inter-relationships within the Group’s credit portfolios. The average weightings
applied across the Group are set out below:
Mar 24

Sep 23

Mar 23

45%

Group
Base

46%

46%

Upside0%0%0%

Downside

41%

41%

40%

Severe downside

13%

13%

15%

ECL - Sensitivity analysis
Given inherent economic uncertainties and the judgement applied to factors used in determining the expected default of borrowers in future periods, ECL
reported by the Group should be considered as a best estimate within a range of possible estimates.
The table below illustrates the sensitivity of the Group’s allowance for collectively assessed ECL to key factors used in determining it at 31 March 2024:
Balance
Sheet$M(Profit) and Loss
Impact$M

If 1% of stage 1 facilities were included in stage 2

4,128

82

If 1% of stage 2 facilities were included in stage 1

4,040

(6)

100% upside scenario

1,354(2,692)

100% base scenario

1,929(2,117)

100% downside scenario

3,280

(766)

100% severe downside scenario

10,003

5,957

79

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1.

Basis of preparation, cont’d

Investments in associates
The Group assesses the carrying value of its investments in associates for impairment indicators semi-annually. Investments may be subjected to
impairment depending on whether indicators of impairment exist, and then where a value-in-use (VIU) or fair value less cost of disposal recoverable
value assessment indicate that impairment is warranted.
As at 31 March 2024, the impairment assessment indicated that one of the Group’s associate investments, PT Panin, had indicators of impairment.
Although its market value (based on share price) was below its carrying value, no impairment was recognised as the carrying value was supported by its
VIU.
Significant management judgement is required in determining the key assumptions underpinning the VIU calculations. Factors may change insubsequent periods and lead to potential future impairments or reversals of prior period impairments. These include forecast earnings levels in the nearterm and/or changes in the long-term growth forecasts, required levels of regulatory capital and post-tax discount rate.
The key assumptions used in the VIU calculations are outlined below:
Post-tax discount rate

12.4%

Terminal growth rate

5.0%

Expected earnings growth (compound annual growth rate – 5 years)

7.5%

Risk weighted asset growth (compound annual growth rate – 5 years)

4.75%

Common Equity Tier 1

23.5%

The VIU calculations are sensitive to changes in the underlying assumptions with reasonably possible changes in key assumptions having a positive or
negative impact on the VIU outcome, and as such the recoverable amount of the investment.
•

A change in the post-tax discount rate by +/- 50 bps would impact the VIU outcome by ($88 million)/$100 million.

•

A change in the terminal growth rate by +/- 50 bps would impact the VIU outcome by $74 million/($64 million).

•

A change in the earnings growth by +/- 75 bps would impact the VIU outcome by $69 million/($64 million).

Considering the interrelationship of the key inputs to the VIU model as outlined above, the Group estimates that the reasonably possible range of VIU is$1,561 million to $1,238 million compared to the carrying value of $1,405 million. The possible range of VIU is based on impacts set out in thesensitivities above arising from the changes in the earnings growth forecasts over the forecast period, the long-term growth rate and the discount rate.
Provisions
The Group holds provisions for various obligations including restructuring costs, customer remediation, non-lending losses, fraud and forgeries andlitigation related claims. These provisions involve judgements regarding the timing and outcome of future events, including estimates of expenditure
required to satisfy such obligations. The appropriateness of the underlying assumptions for provisions is reviewed on a regular basis against actual
experience and other relevant evidence, including expert legal advice, and adjustments are made to the provisions where appropriate.

80

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
2.

IncomeHalf Year

Movement

Interest income

Mar 24$M
29,811

Sep 23$M
27,072

Mar 23$M
22,832

Mar 24v. Sep 23
10%

Mar 24v. Mar 23
31%

Interest expense(21,720)(18,820)(14,157)

15%

53%

Major bank levy

(192)

(178)

(175)

8%

10%

Net interest income

7,899

8,074

8,500

-2%

-7%

Other operating incomei) Fee and commission income
Lending fees1
Non-lending fees

207

198

199

5%

4%

1,169

1,183

1,129

-1%

4%

Commissions

37

45

40

-18%

-8%

Funds management income

125

124

122

1%

2%

Fee and commission income

1,538

1,550

1,490

-1%

3%

Fee and commission expense

(566)

(535)

(552)

6%

3%

Net fee and commission income

972

1,015

938

-4%

4%

1,112

946

590

18%

88%

20

43

-

-53%

n/a

-

-

(43)

n/a

large

ii) Other income
Net foreign exchange earnings and other financial instruments income2
Release of foreign currency translation reserve
Loss on reclassification of data centres to held for sale
Loss on partial disposal of investment in AmBank

(21)

-

-

n/a

n/a

Other

31

69

10

-55%

large

Other income

1,142

1,058

557

8%

large

Other operating income

2,114

2,073

1,495

2%

41%

48

53

55

-9%

-13%

Net income from insurance business
Share of associates' profit/(loss)
Operating income
1.

84

120

101

-30%

-17%

10,145

10,320

10,151-2%

0%

Lending fees exclude fees treated as part of the effective yield calculation in interest income.
2. Includes fair value movements (excluding realised and accrued interest) on derivatives not designated as accounting hedges entered into to manage interest rate and foreign exchange risk,
ineffective portions of cash flow hedges, and fair value movements in financial assets and liabilities measured and/or designated at fair value through profit or loss.

81

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
3.

Operating expenses
Half Year

Movement

Mar 24$M

Sep 23$M

Mar 23$M

Mar 24v. Sep 23

Mar 24v. Mar 23i) Personnel
2,744

2,572

2,608

7%

5%

Superannuation costs

Salaries and related costs

219

201

195

9%

12%

Other

99

96

90

3%

10%

3,062

2,869

2,893

7%

6%

Personnelii) Premises
Rent

37

37

34

0%

9%

Depreciation

200

200

210

0%

-5%

Other

84

87

90

-3%

-7%

Premises

321

324

334

-1%

-4%

Depreciation and amortisation

241

248

257

-3%

-6%

Subscription licences and outsourced services

549

523

484

5%

13%

Other

108

93

95

16%

14%

Technology

898

864

836

4%

7%

iv) Restructuring

141

115

54

23%

large

iii) Technologyv) OtherAdvertising and public relations

93

98

93

-5%

0%

Professional fees

337

454

407

-26%

-17%

Freight, stationery, postage and communication

78

89

86

-12%

-9%

Other

285

329

294

-13%

-3%

Other
Operating expenses

82

793

970

880

-18%

-10%

5,215

5,142

4,997

1%

4%

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
4.

Income tax expense

Reconciliation of the prima facie income tax expense on pre-tax profit with the income tax expense recognised in the profit and loss.
Half Year

Movement

Profit before income tax

Mar 24$M
4,860

Sep 23$M
5,066

Mar 23$M
5,021

Mar 24v. Sep 23-4%

Mar 24v. Mar 23-3%

Prima facie income tax expense at 30%

1,458

1,520

1,507

-4%

-3%

Tax effect of permanent differences:
Share of associates' (profit)/loss

(25)

(35)

(31)

-29%

-19%

Interest on convertible instruments

64

54

38

19%

68%

Overseas tax rate differential

(86)

(69)

(94)

25%

-9%

Provision for foreign tax on dividend repatriation

21

23

18

-9%

17%
large

Other

(2)

7

15

large

Subtotal

1,430

1,500

1,453

-5%

-2%

9

1

(1)

large

large

1,439

1,501

1,452

-4%

-1%

Australia

757

793

853

-5%

-11%

Overseas

682

708

599

-4%

14%

Income tax expense

1,439

1,501

1,452

-4%

-1%

Effective tax rate

29.6%

29.6%

28.9%

Income tax (over)/under provided in previous years
Income tax expense

83

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
5.

Dividends
Half Year

Dividend per ordinary share (cents)

Movement

Mar 24

Sep 23

Mar 23

-

-

81

83

-

-

Mar 24v. Sep 23

Mar 24v. Mar 23

-12%

2%

Interim- fully franked1
2- partially franked
Final- partially franked (comprising 81 cents and an additional dividend of 13 cents)3
Total

Ordinary share dividend ($M)4
Interim dividend
Final dividend
Bonus option plan adjustment

-

94

-

83

94

81

-

2,433

-

2,825

-

2,213

(54)

(46)

(41)

17%

32%

16%

28%

Total

2,771

2,387

2,172

Ordinary share dividend payout ratio (%)5

73.3%

79.6%

68.4%

1.
2.
3.
4.

5.

2023 interim dividend was fully franked for Australian tax purposes (30% tax rate) and carried New Zealand imputation credits of NZD 9 cents.
2024 proposed interim dividend will be partially franked at 65% for Australian tax purposes (30% tax rate) and carry New Zealand imputation credits of NZD 12 cents.
2023 final dividend was partially franked at 56% for Australian tax purposes (30% tax rate) and carried New Zealand imputation credits of NZD 11 cents.
Dividend paid to ordinary equity holders of the Company. Excludes dividends paid by subsidiaries to the Group’s non-controlling equity holders of $13 million (Sep 23 half: $14 million;
Mar 23 half: $13 million).
Dividend payout ratio is calculated using the proposed 2024 interim dividend of $2,496 million, based on the forecast number of ordinary shares on issue at the dividend record date.
Dividend payout ratios for the September 2023 half and March 2023 half were calculated using actual dividends.

Ordinary Shares
The Directors proposed an interim dividend of 83 cents be paid on each eligible fully paid ANZ ordinary share, partially franked at 65% for Australian
taxation purposes. The interim dividend will be paid on 1 July 2024 to owners of ordinary shares at the close of business on 14 May 2024 (record date),and carry New Zealand imputation credits of NZD 12 cents per ordinary share.
ANZ has a dividend reinvestment plan and a bonus option plan that will operate in respect of the proposed 2024 interim dividend.

84

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
6.

Earnings per share
Half Year

Movement

Mar 24

Sep 23

Mar 23

Mar 24v. Sep 23

Mar 24v. Mar 23

Basic earnings per share (cents)

113.5

118.4

118.7

-4%

-4%

Diluted earnings per share (cents)

111.5

113.8

113.0

-2%

-1%

3,421

3,565

3,569

-4%

-4%

Earnings per share

Reconciliation of earnings used in earnings per share calculations
Basic:
Profit for the period ($M)
Less: Profit attributable to non-controlling interests ($M)
Earnings used in calculating basic earnings per share ($M)

14

14

14

0%

0%

3,407

3,551

3,555

-4%

-4%

3,407

3,551

3,555

-4%

-4%

217

182

150

19%

45%

3,624

3,733

3,705

-3%

-2%

3,001.3

3,000.2

2,994.1

0%

0%

239.6

273.9

277.3

-13%

-14%

8.5

7.5

6.9

13%

23%

3,249.4

3,281.6

3,278.3-1%-1%

Diluted:Earnings used in calculating basic earnings per share ($M)
Add: Interest on convertible subordinated debt ($M)
Earnings used in calculating diluted earnings per share ($M)

Reconciliation of weighted average number of ordinary shares (WANOS)
used in earnings per share calculations1
WANOS used in calculating basic earnings per share (M)Add: Weighted average dilutive potential ordinary shares (M)Convertible subordinated debt (M)Share based payments (options, rights and deferred shares) (M)
WANOS used in calculating diluted earnings per share (M)1.

WANOS excludes the weighted average number of treasury shares held in ANZEST Pty Ltd of 5.3 million in the March 2024 half (Sep 23 half: 4.1 million; Mar 23 half: 4.2 million).

85

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
7.

Segment reportingi) Description of segments
The Group operates on a divisional structure with six divisions: Australia Retail, Australia Commercial, Institutional, New Zealand, Pacific, and Group
Centre. For further information on the composition of divisions refer to the Definitions on page 125.
The presentation of divisional results has been impacted by a number of cost reallocations across and within the divisions during the period. Prior period
comparatives have been restated.
Operating segments presented below are consistent with internal divisional reporting provided to the chief operating decision maker, being the Chief
Executive Officer.
ii) Operating segments
The Group measures the performance of operating segments on a cash profit basis. To calculate cash profit, the Group excludes items from profit after
tax attributable to shareholders. For the current and prior periods, the adjustments relate to impacts of economic hedges, and revenue and expense
hedges, which represent timing differences that will reverse through earnings in the future.
Transactions between divisions across segments within the Group are conducted on an arm’s length basis and where relevant disclosed as part of theincome and expenses of these segments.
Australia
Australia
Retail Commercial Institutional
$M
$M
$M

March 2024 Half YearNet interest income

New
Zealand$M

Pacific$M

Group
Centre
$M

Group
Total
$M

2,608

1,580

1,882

1,572

63

194

7,899

Net fee and commission income

247

146

368

207

8

(4)

972

Net income from insurance business

48

-

-

-

-

-

48

Other income

6

23

1,319

1

36

(41)

1,344

Share of associates’ profit/(loss)

-

-

-

-

-

84

84

Operating income1,2

2,909

1,749

3,569

1,780

107

233

10,347

Operating expenses(1,735)(763)(1,444)

(677)

(70)

(526)

(5,215)

Cash profit before credit impairment and income tax

1,174

986

2,125

1,103

37

(293)

5,132

1,2

Credit impairment (charge)/release

(43)

(35)

6

(4)

6

-

(70)

Cash profit before income tax

1,131

951

2,131

1,099

43

(293)

5,062

Income tax expense1,2

(337)

(286)

(609)

(308)

(11)

55

(1,496)

Non-controlling interests

-

-

-

-

(1)

(13)

(14)

794

665

1,522

791

31

(251)

3,552

Cash profit/(loss)
Economic hedges1
Revenue and expense hedges

(197)
2

52
3,407

Profit after tax attributable to shareholders
Financial Position
Total external assets

325,775

64,279513,026

124,986

3,195

58,4381,089,699

Total external liabilities

176,484

122,386

407,444

122,3103,791

186,210

1,018,625

1.

The economic hedges cash profit adjustment relates to the Institutional, New Zealand and Group Centre divisions. In the condensed consolidated income statement, these amounts arerecognised in Other operating income (Mar 24 half: $277 million loss; Sep 23 half: $36 million loss; Mar 23 half: $269 million loss) and Income tax expense (Mar 24 half: $80 million benefit;
Sep 23 half: $9 million benefit; Mar 23 half: $79 million benefit).
2. The revenue and expense hedges cash profit adjustment relates to the Group Centre division. In the condensed consolidated income statement, these amounts are recognised in Other
operating income (Mar 24 half: $75 million gain; Sep 23 half: $9 million loss; Mar 23 half: $120 million loss) and Income tax expense (Mar 24 half: $23 million loss; Sep 23 half: $3 million
benefit; Mar 23 half: $36 million benefit).

86

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
7.

Segment reporting, cont’d

September 2023 Half YearNet interest income

Australia
Australia
Retail Commercial Institutional
$M
$M
$M

New
Zealand$M

Pacific$M

Group
Centre
$M

Group
Total
$M

2,694

1,592

1,969

1,567

61

191

8,074

Net fee and commission income

311

160

339

199

9

(3)

1,015

Net income from insurance business

53

-

-

-

-

-

53

Other income1,2

10

30

982

11

36

34

1,103

Share of associates’ profit/(loss)

-

-

-

-

-

120

120

Operating income1,2

3,068

1,782

3,290

1,777

106

342

10,365

Operating expenses(1,758)(738)(1,388)

(665)

(71)

(522)

(5,142)

Cash profit before credit impairment and income tax

1,310

1,044

1,902

1,112

35

(180)

5,223

(53)

(41)

6

(37)

12

1

(112)

Cash profit before income tax

1,257

1,003

1,908

1,075

47

(179)

5,111

Income tax expense1,2

(383)

(302)

(548)

(300)

(8)

28

(1,513)

Non-controlling interests

-

-

-

-

(2)

(12)

(14)

874

701

1,360

775

37

(163)

3,584

Credit impairment (charge)/releaseCash profit/(loss)
Economic hedges1(27)

Revenue and expense hedges2(6)

Profit after tax attributable to shareholders

3,551

Financial Position
Total external assets

315,207

61,916

538,825

125,178

3,391

61,126

1,105,643

Total external liabilities

168,926

119,341

452,777

122,924

3,862

167,796

1,035,626

March 2023 Half YearNet interest income

3,015

1,632

2,071

1,582

62

138

8,500

Net fee and commission income

235

162

346

199

10

(14)

938

Net income from insurance business

55

-

-

-

-

-

55

Other income1,2

6

13

1,027

-

30

(130)

946

Share of associates’ profit/(loss)

-

-

-

-

-

101

101

Operating income1,2

3,311

1,807

3,444

1,781

102

95

10,540Operating expenses(1,703)(685)(1,340)

(634)

(74)

(561)

(4,997)

Cash profit before credit impairment and income tax

1,608

1,122

2,104

1,147

28

(466)

5,543

(82)

(66)

74

(75)

16

-

(133)

Cash profit before income tax

1,526

1,056

2,178

1,072

44

(466)

5,410

Income tax expense1,2

(462)

(317)

(589)

(301)

(10)

112

(1,567)

Credit impairment (charge)/releaseNon-controlling interests
Cash profit/(loss)

-

-

-

-

-

(14)

(14)

1,064

739

1,589

771

34

(368)

3,829

Economic hedges1(190)

Revenue and expense hedges2(84)

Profit after tax attributable to shareholders

3,555

Financial Position
Total external assets

303,820

60,227525,745

123,565

3,489

94,391

1,111,237

Total external liabilities

160,297

119,042

450,764

121,580

3,834

186,140

1,041,657

1.

The economic hedges cash profit adjustment relates to the Institutional, New Zealand and Group Centre divisions. In the condensed consolidated income statement, these amounts arerecognised in Other operating income (Mar 24 half: $277 million loss; Sep 23 half: $36 million loss; Mar 23 half: $269 million loss) and Income tax expense (Mar 24 half: $80 million benefit;
Sep 23 half: $9 million benefit; Mar 23 half: $79 million benefit).
2. The revenue and expense hedges cash profit adjustment relates to the Group Centre division. In the condensed consolidated income statement, these amounts are recognised in Other
operating income (Mar 24 half: $75 million gain; Sep 23 half: $9 million loss; Mar 23 half: $120 million loss) and Income tax expense (Mar 24 half: $23 million loss; Sep 23 half: $3 million
benefit; Mar 23 half: $36 million benefit).

87

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
8.

Net loans and advances
As at

Movement

Mar 24$M

Sep 23$M

Mar 23$M

Mar 24v. Sep 23

Mar 24v. Mar 23

Australia
Overdrafts

4,031

4,190

3,834

-4%

5%

Credit cards outstanding

5,607

5,625

5,670

0%

-1%

Commercial bills outstanding

4,557

4,682

4,898

-3%

-7%

Term loans - housing

314,103

304,133

292,597

3%

7%

Term loans - non-housing

173,114

169,046

166,051

2%

4%

927

961

916

-4%

1%

502,339

488,637

473,966

3%

6%

Other
Total Australia
New Zealand
Overdrafts
Credit cards outstanding

850

906

879

-6%

-3%

1,163

1,174

1,184

-1%

-2%

Term loans - housing

100,407

99,92897,9390%

3%

Term loans - non-housing

36,48737,55738,381-3%-5%

Total New Zealand

138,907

139,565

138,383

0%

0%

530

456

568

16%

-7%

6

6

6

0%

0%

431

430

475

0%

-9%

73,18478,20577,095

-6%

-5%

115

331

613

-65%

-81%

Rest of World
Overdrafts
Credit cards outstanding
Term loans - housing
Term loans - non-housing
Other
Total Rest of World

74,26679,42878,757-6%-6%

Subtotal

715,512707,630

691,106

1%

4%

(494)

(515)

(526)

-4%

-6%

Unearned income1
1

Capitalised brokerage and other origination costs
Gross loans and advances

Allowance for ECL (refer to Note 9)
Net loans and advances
1.

Amortised over the expected life of the loan.

88

3,642

3,475

3,165

5%

15%

718,660

710,590693,7451%

4%(3,489)(3,546)(3,658)-2%-5%715,171707,044690,087

1%

4%

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
9.

Allowance for expected credit losses
As at
Collectively
assessed$M

Mar 24
Individuallyassessed$M

3,169

Off-balance sheet commitments undrawn and contingent facilities
Investment securities - debt securities
at amortised cost

Net loans and advances atamortised cost

Total

Total
$M

Collectively
assessed$M

Sep 23
Individuallyassessed
$M

Total
$M

Collectively
assessed$M

Mar 23
Individuallyassessed
$M

Total
$M

320

3,489

3,180

366

3,546

3,244

414

3,658

844

5

849

817

10

827

767

7

774

33

-

33

35

-

35

29

-

29

4,046

325

4,371

4,032

376

4,408

4,040

421

4,461

17

-

17

15

-

15

13

-

13

Other Comprehensive Income
Investment securities - debt securities
at FVOCI1
1.

For FVOCI assets, the allowance for ECL does not alter the carrying amount which remains at fair value. Instead, the allowance for ECL is recognised in Other comprehensive income with acorresponding charge to profit or loss.

The following tables present the movement in the allowance for ECL.
Net loans and advances at amortised cost
Allowance for ECL is included in Net loans and advances.

Stage 3
Stage 1
$M

Stage 2
$M

Collectively
assessed$M

Individuallyassessed
$M

Total
$M

As at 1 October 2022

1,141

1,548

360

533

3,582

Transfer between stages

114

(100)

(63)

49

-

New and increased provisions (net of releases)

(103)

264

56

188

405

Write-backs

-

-

-

(164)

(164)

Bad debts written-off (excluding recoveries)

-

-

-

(185)

(185)

Foreign currency translation and other movements1

7

17

3

(7)

20

1,159

1,729

356

414

3,658

Transfer between stages

148

(159)

(65)

76

-

New and increased provisions (net of releases)

(84)

59

39

159

173

As at 31 March 2023

Write-backs

-

-

-

(48)

(48)

Bad debts written-off (excluding recoveries)

-

-

-

(224)

(224)

Foreign currency translation and other movements1

4

(5)

(1)

(11)

(13)

As at 30 September 2023

1,227

1,624

329

366

3,546

Transfer between stages

129

(144)

(49)

64

-

New and increased provisions (net of releases)

(119)

64

120

137

202

Write-backs

-

-

-

(80)

(80)

Bad debts written-off (excluding recoveries)

-

-

-

(146)

(146)

Foreign currency translation and other movements1
As at 31 March 2024
1.

(5)

(6)

(1)

(21)

(33)

1,232

1,538

399

320

3,489

Other movements include the impact of discounting on expected cash flows for individually assessed allowances for ECL and the impact of divestments completed during the period.

89

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
9.

Allowance for expected credit losses, cont’d

Off-balance sheet commitments - undrawn and contingent facilities
Allowance for ECL is included in Other provisions.
Stage 3
Stage 1
$M

Stage 2
$M

Collectively
assessed$M

Individuallyassessed
$M

Total
$M

As at 1 October 2022

593

144

29

9

775

Transfer between stages

24

(22)

(2)

-

-

New and increased provisions (net of releases)

(30)

30

1

-

1

Write-backs

-

-

-

(2)

(2)

Foreign currency translation

(1)

-

1

-

-

586

152

29

7

774

Transfer between stages

14

(13)

(3)

2

-

New and increased provisions (net of releases)

23

22

(1)

2

46

As at 31 March 2023

Write-backs

-

-

-

(2)

(2)

Foreign currency translation and other movements1

7

1

-

1

9

As at 30 September 2023

630

162

25

10

827

Transfer between stages

18

(16)

(2)

-

-

New and increased provisions (net of releases)

7

22

1

-

30
(5)

Write-backs

-

-

-

(5)

Foreign currency translation

(2)

(1)

-

-

(3)

653

167

24

5

849

Individuallyassessed
$M

Total
$M

As at 31 March 2024
1.

Other movements include the impact of divestments completed during the period.

Investment securities - debt securities at amortised cost
Allowance for ECL is included in Investment securities.

Stage 3
Stage 1
$M

Collectively
Stage 2
assessed$M$M

As at 31 March 2023

29

-

-

-

29

As at 30 September 2023

35

-

-

-

35

As at 31 March 2024

33

-

-

-

33

Investment securities - debt securities at FVOCIFor FVOCI assets, the allowance for ECL does not alter the carrying amount which remains at fair value. Instead, the allowance for ECL is recognised in
Other comprehensive income with a corresponding charge to profit or loss.
Stage 3
Stage 1
$M

Stage 2
$M

Collectively
assessed$M

Individuallyassessed
$M

Total
$M

As at 31 March 2023

13

-

-

-

13

As at 30 September 2023

15

-

-

-

15

As at 31 March 2024

17

-

-

-

17

90

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
9.

Allowance for expected credit losses, cont’dCredit impairment charge/(release) analysis
Half Year

Movement

Mar 24$M

Sep 23$M

Mar 23$M

Mar 24v. Sep 23

Mar 24v. Mar 23- Collectively assessed

32

(11)

163

large

-80%

- Individually assessed

New and increased provisions (net of releases)1,2

201

239

237

-16%

-15%

Write-backs3

(85)

(50)

(166)

70%

-49%

Recoveries of amounts previously written-off

(78)

(66)

(101)

18%

-23%

Total credit impairment charge/(release)

70

112

133

-38%

-47%

1.
2.

Includes the impact of transfers between collectively assessed and individually assessed.
New and increased provisions (net of releases) includes:
Mar 24 half

Net loans and advances at amortised cost
Off-balance sheet commitments – undrawn andcontingent facilities
Investment securities - debt securities atamortised cost3.

Sep 23 half

Mar 23 half

Collectively
assessed$M

Individuallyassessed$M

Collectively
assessed$M

Individuallyassessed$M

Collectively
assessed$M

Individuallyassessed
$M

1

201

(62)

235

168

237

42

4

1

-

(8)

-

30
(1)

-

7

-

Investment securities - debt securities at FVOCI

2

-

2

-

2

-

Total

32

201

(11)

239

163

237

Consists of write-backs in Net loans and advances at amortised cost of $80 million for the March 2024 half (Sep 23 half: $48 million; Mar 23 half: $164 million), and Off-balance sheet
commitment of $5 million for the March 2024 half (Sep 23 half: $2 million; Mar 23 half: $2 million).

91

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
10.

Deposits and other borrowings
As at

Movement

Mar 24$M

Sep 23$M

Mar 23$M

Mar 24v. Sep 23

Mar 24v. Mar 23

Certificates of deposit

30,572

33,61337,920-9%-19%

Term deposits

86,85779,51876,3419%

14%

On demand and short term deposits

283,155

278,014

270,418

2%

5%

Deposits not bearing interest

19,95520,856

22,815-4%-13%

Deposits from banks and securities sold under repurchase agreements

38,42542,49353,990-10%-29%

Commercial paper and other borrowings

42,06031,01336,24836%

16%

Total Australia

501,024

485,507497,732

3%

1%

Australia

New ZealandCertificates of deposit

1,800

2,167

1,392

-17%

29%

Term deposits

52,76250,45147,5985%

11%

On demand and short term deposits

55,56956,47956,307-2%-1%

Deposits not bearing interest

15,825

16,438

18,103-4%-13%

Deposits from banks and securities sold under repurchase agreements

3,912

4,123

4,398

-5%

-11%

Commercial paper and other borrowings

3,152

2,098

2,596

50%

21%

133,020

131,756

130,3941%

2%

Total New ZealandRest of World

6,723

6,139

5,233

10%

28%

Term deposits

Certificates of deposit

100,919

117,924

127,467

-14%

-21%

On demand and short term deposits

20,56921,827

24,125-6%-15%

Deposits not bearing interest

5,479

5,612

5,453

-2%

0%

Deposits from banks and securities sold under repurchase agreements

39,00345,94652,160-15%-25%

Total Rest of World

172,693

197,448

214,438

-13%

-19%

Deposits and other borrowings1

806,737

814,711

842,564

-1%

-4%

1.

Customer deposits balance of $641,090 million (Sep 23: $647,119 million; Mar 23: $648,627 million) includes Term deposits, On demand and short term deposits and Deposits not bearing
interest.

92

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
11.

Debt issuances
As at

Total unsubordinated debt

Movement

Mar 24$M
90,763

Sep 23$M
82,336

Mar 23$M
73,443

Mar 24v. Sep 23
10%

Mar 24v. Mar 23
24%

Additional Tier 1 Capital (perpetual subordinated securities)1
ANZ Capital Notes (ANZ CN)2
ANZ CN43

-

1,621

1,620

large

large

ANZ CN5

930

929

929

0%

0%

ANZ CN6

1,490

1,489

1,488

0%

0%

ANZ CN7

1,299

1,298

1,297

0%

0%

ANZ CN8

1,484

1,483

1,482

0%

0%

ANZ CN93

1,678

-

-

n/a

n/a

ANZ Capital Securities4

1,434

1,412

1,380

2%

4%

Tier 2 Capital - Term Subordinated Notes5

26,75423,707

22,797

13%

17%

Other subordinated debt securities6

1,277

1,739

1,721

-27%

-26%

Total subordinated debt

36,34633,67832,7148%

11%

Total debt issuances

127,109

116,014106,157

10%

20%

1.
2.

3.

4.

5.

6.

ANZ Capital Notes and ANZ Capital Securities are Basel 3 compliant instruments.
Each of the ANZ Capital Notes will convert into a variable number of ordinary shares of ANZGHL on a specified mandatory conversion date at a 1% discount (subject to certain conditions
being satisfied). If ANZBGL’s Common Equity Tier 1 capital ratio is equal to or less than 5.125%, or ANZBGL receives a notice of non-viability from APRA, then the notes will immediately
convert into a variable number of ordinary shares of ANZGHL at a 1% discount subject to a maximum conversion number. Subject to certain conditions, the notes are redeemable orconvertible into ordinary shares of ANZGHL (on similar terms to mandatory conversion) by ANZBGL at its discretion on an early redemption or conversion date.
IssuerIssue dateIssue amount$M

Early redemption orconversion date

Mandatory
conversion date

CN4

ANZBGL27 Sep 2016

1,622

20 Mar 2024

20 Mar 2026

CN5

ANZBGL

28 Sep 2017931

20 Mar 2025

20 Mar 2027

CN6

ANZBGL

8 Jul 2021

1,500

20 Mar 2028

20 Sep 2030

CN7

ANZBGL24 Mar 2022

1,310

20 Mar 2029

20 Sep 2031

CN8

ANZBGL24 Mar 2023

1,500

20 Mar 2030

20 Sep 2032

CN9

ANZBGL20 Mar 2024

1,700

20 Mar 2031

20 Sep 2033

ANZBGL fully redeemed ANZ CN4 on 20 March 2024. Approximately $905 million of the proceeds from ANZ CN4 were reinvested into ANZ CN9, which was issued by ANZBGL on thesame date.
On 15 June 2016, ANZBGL, acting through its London branch, issued USD 1 billion fully-paid perpetual subordinated contingent convertible securities (ANZ Capital Securities). If ANZBGL’s
Common Equity Tier 1 capital ratio is equal to or less than 5.125%, or ANZBGL receives a notice of non-viability from APRA, then the securities will immediately convert into a variable
number of ANZGHL ordinary shares at a 1% discount subject to a maximum conversion number. Subject to certain conditions, on the First Reset Date (15 June 2026) and on each 5-year
anniversary, ANZ has the right to redeem all of the securities at its discretion.
All the term subordinated notes are convertible and are Basel 3 compliant instruments. If ANZBGL receives a notice of non-viability from APRA, then the convertible subordinated notes will
immediately convert into a variable number of ordinary shares of ANZGHL at a 1% discount subject to a maximum conversion number.
ANZ Bank New Zealand Limited, a wholly owned subsidiary of ANZGHL, issued NZD 600 million and USD 500 million of unsecured subordinated notes in September 2021 and August2022 respectively. Whilst these notes constitute Tier 2 capital under RBNZ requirements, the notes do not contain a Non-Viability Trigger Event and therefore do not meet APRA's
requirements for Tier 2 capital instruments to qualify as regulatory capital for the Group. The USD 300 million perpetual subordinated notes issued by ANZBGL, which were contained inother subordinated debt, were redeemed on 31 October 2023.

93

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
12.

Credit risk

Maximum exposure to credit risk
For financial assets recognised on the balance sheet, the maximum exposure to credit risk is the carrying amount. In certain circumstances there may bedifferences between the carrying amounts reported on the balance sheet and the amounts reported in the tables below. Principally, these differences
arise in respect of financial assets that are subject to risks other than credit risk, such as equity instruments which are primarily subject to market risk, orbank notes and coins.
For undrawn facilities, this maximum exposure to credit risk is the full amount of the committed facilities. For contingent exposures, the maximum
exposure to credit risk is the maximum amount the Group would have to pay if the instrument is called upon.
The table below shows the maximum exposure to credit risk of on-balance sheet, and off-balance sheet positions before taking account of any collateral
held or other credit enhancements:

On-balance sheet positions
Net loans and advances

Reported

Excluded1

Maximum Exposure to Credit Risk

As at

As at

As at

Mar 24$M

Sep 23$M

Mar 23$M

Mar 24$M

Sep 23$M

Mar 23$M

Mar 24$M

Sep 23$M

Mar 23$M

715,171707,044690,087---

715,171707,044690,087

Investment securities- debt securities at amortised cost

7,900

7,752

7,912

-

-

-

7,900

7,752

7,912

- debt securities at FVOCI

108,530

88,271

84,589---108,530

88,271

84,589- equity securities at FVOCI

1,611

1,393

1,453

1,611

1,393

1,453

-

-

-

- debt securities at FVTPL

14

13

18

-

-

-

14

13

18

244,684

288,456

314,694

8,643

15,3008,521

236,041

273,156

306,173

1,077,910

1,092,929

1,098,753

10,254

16,693

9,974

1,067,656

1,076,236

1,088,779

289,371

290,055

292,550---

289,371

290,055

292,550

1,367,281

1,382,984

1,391,303

10,254

16,6939,974

1,357,027

1,366,291

1,381,329

Other financial assets
Total on-balance sheet positions
Off-balance sheet commitments
Undrawn and contingent facilities2
Total
1.
2.

Excluded comprises bank notes and coins and cash at bank within Other financial assets, and investment securities - equity securities at FVOCI as they do not have credit exposure.
Undrawn and contingent facilities include guarantees, letters of credit and performance related contingencies, net of collectively assessed allowance for expected credit losses.

Credit Quality
The Group’s internal Customer Credit Rating (CCR) is used to manage the credit quality of financial assets. To enable wider comparisons, the Group’s
CCRs are mapped to external rating agency scales as follows:
Moody'sRatingStandard &Poor'sRatingDemonstrated superior stability in their operating and financial performance over the longterm, and whose earnings capacity is not significantly vulnerable to foreseeable events.

Aaa - Baa3

AAA - BBB-CCR 5+ to 6-

Demonstrated sound operational and financial stability over the medium to long term eventhough some may be susceptible to cyclical trends or variability in earnings.

Ba1 - B1

BB+ - B+Weak

CCR 7+ to 8=

Demonstrated some operational and financial instability, with variability and uncertainty inprofitability and liquidity projected to continue over the short and possibly medium term.

B2 - Caa

B - CCC

Defaulted

CCR 8- to 10

When doubt arises as to the collectability of a credit facility, the financial instrument (or‘the facility’) is classified as defaulted.

N/A

N/A

Credit Quality
Description

Internal CCR

ANZ Customer Requirement

Strong

CCR 0+ to 4-

Satisfactory

94

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
12.

Credit risk, cont’d

Net loans and advances
Stage 3
Collectively
Individuallyassessedassessed$M$M

As at March 2024

Stage 1
$M

Stage 2
$M

Strong404,954

16,931--

421,885

Satisfactory

199,316

39,766--

239,082

Weak12,541

12,086--

24,627

-

-

5,011

880

5,891

Gross loans and advances at amortised cost

616,81168,7835,011

880

691,485

Allowance for ECL(1,232)(1,538)

(399)

(320)

(3,489)Net loans and advances at amortised cost

615,579

67,2454,612

560

687,996

0.20%

2.24%

7.96%

36.36%

Defaulted

Coverage ratio
Loans and advances at fair value through profit or loss

Total
$M

0.50%
24,027

Unearned income(494)

Capitalised brokerage and other origination costs

3,642

Net carrying amount

715,171

As at September 2023
Strong410,933

17,063--427,996

Satisfactory

193,170

37,977--

231,147

Weak

11,306

10,398--21,704

-

-

3,858

1,037

4,895
685,742

Defaulted
Gross loans and advances at amortised cost

615,40965,438

3,858

1,037

Allowance for ECL(1,227)(1,624)

(329)

(366)

(3,546)Net loans and advances at amortised cost

614,182

63,814

3,529

671

682,196

0.20%

2.48%

8.53%

35.29%

Coverage ratio
Loans and advances at fair value through profit or loss

0.52%
21,888

Unearned income(515)

Capitalised brokerage and other origination costs

3,475

Net carrying amount

707,044

As at March 2023
Strong416,053

Satisfactory

176,054

40,305

Weak

10,072

10,293

-

-

3,378

804

4,182

Gross loans and advances at amortised cost

602,179

65,276

3,378

804

671,637

Allowance for ECL(1,159)(1,729)

(356)

(414)

(3,658)Net loans and advances at amortised cost

601,020

63,5473,022

390

667,979

0.19%

2.65%

10.54%

51.49%

Defaulted

Coverage ratio
Loans and advances at fair value through profit or loss

14,678--

430,731--

216,359--

20,3650.54%
19,469Unearned income(526)

Capitalised brokerage and other origination costs

3,165

Net carrying amount

690,08795

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
12.

Credit risk, cont’d

Off-balance sheet commitments - undrawn and contingent facilities
Stage 3
Collectively
Individuallyassessedassessed$M$M

As at March 2024

Stage 1
$M

Stage 2
$M

Strong

193,490

1,204

-

-

194,694

Satisfactory

23,826

3,648

-

-

27,474

984

719

-

-

1,703

-

-

73

49

122

218,300

5,571

73

49

223,993

Weak
Defaulted
Gross undrawn and contingent facilities subject to ECLAllowance for ECL included in Other provisions
Net undrawn and contingent facilities subject to ECL
Coverage ratio

Total
$M

(653)

(167)

(24)

(5)

(849)

217,647

5,404

49

44

223,144

0.30%

3.00%

32.88%

10.20%

0.38%

Undrawn and contingent facilities not subject to ECL1

66,227Net undrawn and contingent facilities

289,371

As at September 2023
Strong

189,980

1,234

-

-

191,214

Satisfactory

30,007

4,276

-

-

34,283

975

746

-

-

1,721

-

-

79

47

126

220,962

6,256

79

47

227,344

Weak
Defaulted
Gross undrawn and contingent facilities subject to ECLAllowance for ECL included in Other provisions
Net undrawn and contingent facilities subject to ECL
Coverage ratio

(630)

(162)

(25)

(10)

(827)

220,332

6,094

54

37

226,517

0.29%

2.59%

31.65%

21.28%

0.36%

Undrawn and contingent facilities not subject to ECL1

63,538Net undrawn and contingent facilities

290,055

As at March 2023
Strong200,066

1,439

-

-

201,505

Satisfactory

18,769

2,742

-

-

21,511

904

782

-

-

1,686

-

-

89

24

113

219,739

4,963

89

24

224,815

(586)

(152)

(29)

(7)

(774)

219,153

4,811

60

17

224,041

0.27%

3.06%

32.58%

29.17%

Weak
Defaulted
Gross undrawn and contingent facilities subject to ECLAllowance for ECL included in Other provisions
Net undrawn and contingent facilities subject to ECL
Coverage ratio

0.34%

Undrawn and contingent facilities not subject to ECL1

68,509Net undrawn and contingent facilities

292,5501.

Commitments that can be unconditionally cancelled at any time without notice.

96

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
12.

Credit risk, cont’d

Investment securities - debt securities at amortised cost

As at March 2024
StrongSatisfactory

Stage 3
Collectively
Individuallyassessedassessed$M$M

Stage 1
$M

Stage 2
$M

6,018

-

-

-

Total
$M
6,018

137

-

-

-

137

Weak

1,778

-

-

-

1,778

Gross investment securities - debt securities at amortised cost

7,933

-

-

-

7,933

Allowance for ECL

(33)

-

-

-

(33)

Net investment securities - debt securities at amortised cost

7,900

-

-

-

7,900

Coverage ratio

0.42%

-

-

-

0.42%

6,117

-

-

-

6,117

112

-

-

-

112

Weak

1,558

-

-

-

1,558

Gross investment securities - debt securities at amortised cost

7,787

-

-

-

7,787

As at September 2023
StrongSatisfactory

Allowance for ECL

(35)

-

-

-

(35)

Net investment securities - debt securities at amortised cost

7,752

-

-

-

7,752

Coverage ratio

0.45%

-

-

-

0.45%

6,191

-

-

-

6,191

82

-

-

-

82

Weak

1,668

-

-

-

1,668

Gross investment securities - debt securities at amortised cost

7,941

-

-

-

7,941

As at March 2023
StrongSatisfactory

Allowance for ECL

(29)

-

-

-

(29)

Net investment securities - debt securities at amortised cost

7,912

-

-

-

7,912

Coverage ratio

0.37%

-

-

-

0.37%

Stage 3
Collectively
Individuallyassessedassessed
$M
$M

Total
$M

Investment securities - debt securities at FVOCI

As at March 2024

Stage 1
$M

Stage 2
$M

Strong108,530---

108,530

Investment securities - debt securities at FVOCI

108,530---

108,530

(17)

-

-

-

(17)

0.02%

-

-

-

0.02%

Strong88,271---

88,271

Investment securities - debt securities at FVOCI

88,271---

88,271

(15)

-

-

-

(15)

0.02%

-

-

-

0.02%

Strong84,589---84,589Investment securities - debt securities at FVOCI

84,589---84,589

(13)

-

-

-

(13)

0.02%

-

-

-

0.02%

Allowance for ECL recognised in Other comprehensive income
Coverage ratio

As at September 2023

Allowance for ECL recognised in Other comprehensive income
Coverage ratio

As at March 2023

Allowance for ECL recognised in Other comprehensive income
Coverage ratio

97

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
12.

Credit risk, cont’d

Other financial assets
As at

StrongSatisfactory1
Weak
Defaulted
Other financial assets1
1.

Includes Investment securities - debt securities at FVTPL of $14 million (Sep 23: $13 million; Mar 23: $18 million).

98

Mar 24$M

Sep 23$M

Mar 23$M

230,668

269,934

302,785

4,547

2,631

2,333

840

604

1,069

-

-

4

236,055

273,169

306,191

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
13.

Fair value of financial assets and financial liabilities

Classification of Financial Assets and Financial Liabilities
The Group recognises and measures financial instruments at either fair value or amortised cost, with a significant number of financial instruments on thebalance sheet at fair value.
Fair value is the best estimate of the price that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market
participants at the measurement date.
The following tables set out the classification of financial assets and liabilities according to their measurement bases with their carrying amounts asrecognised on the balance sheet.

At amortised cost$M

At fair value
$M

Total
$M

114,635

23,064

137,699

Settlement balances owed to ANZ

3,809

-

3,809

Collateral paid

8,241

-

8,241

Trading assets-

42,44242,442As at March 2024
Financial assets
Cash and cash equivalents

Derivative financial instruments-

47,481

47,481

Investment securities

7,900

110,155

118,055

Net loans and advances

715,171

691,144

24,027

Regulatory deposits

696

-

696

Other financial assets

4,316

-

4,316

830,741

247,169

1,077,910

15,026-15,026

Total
Financial liabilities
Settlement balances owed by ANZ
Collateral received
Deposits and other borrowings
Derivative financial instruments

7,409

-

7,409

776,650

30,087806,737
42,728-42,728

Payables and other liabilities

10,151

6,943

17,094

Debt issuances

125,362

1,747

127,109

Total

934,598

81,505

1,016,103

168,154

As at September 2023
Financial assets
Cash and cash equivalents

140,588

27,566

Settlement balances owed to ANZ

9,349

-

9,349

Collateral paid

8,558

-

8,558

Trading assets-

37,00437,004

Derivative financial instruments-

60,40660,406

Investment securities

7,752

89,67797,429Net loans and advances

685,156

21,888707,044

Regulatory deposits

646

-

646

Other financial assets

4,339

-

4,339

856,388236,541

1,092,929

Total
Financial liabilities
Settlement balances owed by ANZ

19,267-

19,267

Collateral received

10,382-

10,382

Deposits and other borrowings

780,82233,889814,711

Derivative financial instruments-

57,482

57,482

9,830

5,267

15,097

Payables and other liabilities
Debt issuances

114,678

1,336

116,014

Total

934,979

97,974

1,032,953

99

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
13.

Fair value of financial assets and financial liabilities, cont’d

As at March 2023

At amortised cost$M

At fair value
$M

Total
$M
208,800

Financial assets
Cash and cash equivalents

184,092

24,708Settlement balances owed to ANZ

7,020

-

7,020

Collateral paid

9,245

-

9,245

Trading assets-

39,611

39,611

Derivative financial instruments-

45,61445,614

Investment securities

7,912

86,06093,972Net loans and advances

670,618

19,469690,087

Regulatory deposits

646

-

646

Other financial assets

3,758

-

3,758

883,291

215,462

1,098,753
23,010

Total
Financial liabilities
Settlement balances owed by ANZ

23,010-Collateral received

8,002

-

8,002

811,236

31,328842,564-

46,154

46,154

8,324

4,733

13,057

Deposits and other borrowings
Derivative financial instruments
Payables and other liabilities
Debt issuances

104,626

1,531

106,157

Total

955,198

83,746

1,038,944

100

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
13.

Fair value of financial assets and financial liabilities, cont’dFinancial Assets and Financial Liabilities Measured at Fair Value
The fair values of financial assets and financial liabilities are generally determined at the individual instrument level. If the Group holds offsetting risk
positions, then the portfolio exception in AASB 13 Fair Value Measurement (AASB 13) is used to measure the fair value of such groups of financial
assets and financial liabilities. The Group measures the portfolio based on the price that would be received to sell a net long position (an asset) for aparticular risk exposure, or to transfer a net short position (a liability) for a particular risk exposure.
a)

Fair value designation

The Group designates certain loans and advances, deposits and other borrowings and debt issuances as fair value through profit or loss:•

where they contain separable embedded derivatives and are managed on a fair value basis, the total fair value movements are recognised in profit orloss in the same period as the movement on any associated hedging instruments; or•

in order to eliminate an accounting mismatch which would arise if the assets or liabilities were otherwise carried at amortised cost. This mismatcharises due to measuring the derivative financial instruments (used to mitigate interest rate risk of these assets or liabilities) at fair value through profit
or loss.

The Group’s approach ensures that it recognises the fair value movements on the assets or liabilities in profit or loss in the same period as the movementon the associated derivatives.
The Group may also designate certain loans and advances, deposits and other borrowings and debt issuances as fair value through profit or loss where
they are managed on a fair value basis to align the measurement with how the financial instruments are managed.
b)

Fair value approach and valuation techniques

The Group uses valuation techniques to estimate the fair value of assets and liabilities for recognition, measurement and disclosure purposes where noquoted price in an active market for that asset or liability exists. This includes the following:
Asset or Liability

Fair Value Approach

Financial instruments classified as:

Discounted cash flow techniques are used whereby contractual future cash flows of the
instrument are discounted using wholesale market interest rates, or market borrowing
rates for debt or loans with similar maturities or yield curves appropriate for the remaining
term to maturity.

• Derivative financial assets and financial liabilities(including trading and non-trading)• Repurchase agreements < 90 days
• Net loans and advances• Deposits and other borrowings• Debt issuances
Other financial instruments held for trading:• Securities sold short

Valuation techniques are used that incorporate observable market inputs for financial
instruments with similar credit risk, maturity and yield characteristics.

• Debt and equity securities

Equity securities where an active market does not exist are measured using comparable
company valuation multiples (such as price-to-book ratios).

Financial instruments classified as:

Valuation techniques use comparable multiples (such as price-to-book ratios) or
discounted cashflow (DCF) techniques incorporating, to the extent possible, observable
inputs from instruments with similar characteristics.

• Investment securities – debt or equity

There were no significant changes to valuation approaches during the current or prior periods.

c)

Fair value hierarchy

The Group categorises assets and liabilities carried at fair value into a fair value hierarchy in accordance with AASB 13 based on the observability of
inputs used to measure the fair value:•

Level 1 - valuations based on quoted prices (unadjusted) in active markets for identical assets or liabilities;•

Level 2 - valuations using inputs other than quoted prices included within Level 1 that are observable for a similar asset or liability, either directly or
indirectly; and•Level 3 - valuations where significant unobservable inputs are used to measure the fair value of the asset or liability.

There were no significant changes to levelling approaches during the current or prior periods.

101

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
13.

Fair value of financial assets and financial liabilities, cont’d

The following table presents financial assets and financial liabilities carried at fair value in accordance with the fair value hierarchy:
Fair value measurements
As at March 2024
AssetsCash and cash equivalents (measured at fair value)
Trading assets1
Derivative financial instruments
Investment securities1
Net loans and advances (measured at fair value)
Total

Level 1
$M

Level 2
$M

Level 3
$M

Total
$M

-

23,064-23,06429,315

13,126

1

42,442228

47,22627

47,481

87,121

21,651

1,383

110,155-

23,428599

24,027

116,664

128,495

2,010

247,169

Liabilities
Deposits and other borrowings (designated at fair value)-

30,087-30,087

Derivative financial instruments

192

42,521

15

42,728

Payables and other liabilities

6,659

284

-

6,943

Debt issuances (designated at fair value)
Total

-

1,747

-

1,747

6,851

74,63915

81,505-27,566-

27,566As at September 2023
AssetsCash and cash equivalents (measured at fair value)
Trading assets

1

Derivative financial instruments
Investment securities1
Net loans and advances (measured at fair value)
Total

26,388

10,6142

37,004935

59,44823

60,406

71,356

16,924

1,397

89,677-

21,159729

21,88898,679135,7112,151

236,541

Liabilities
Deposits and other borrowings (designated at fair value)-

33,889-33,889Derivative financial instruments

218

57,241

23

57,482

Payables and other liabilities

4,841

426

-

5,267

-

1,336

-

1,336

5,059

92,892

23

97,974

Debt issuances (designated at fair value)
Total
As at March 2023
AssetsCash and cash equivalents (measured at fair value)
Trading assets1
Derivative financial instruments
Investment securities

1

Net loans and advances (measured at fair value)
Total

-

24,708-24,70826,59313,017

1

39,611

315

45,27524

45,614

68,176

16,421

1,463

86,060-19,089380

19,46995,084

118,510

1,868

215,462

Liabilities
Deposits and other borrowings (designated at fair value)-

31,328-31,328Derivative financial instruments

765

45,36326

46,154

Payables and other liabilities

3,572

1,161

-

4,733

-

1,531

-

1,531

4,337

79,38326

83,746

Debt issuances (designated at fair value)
Total
1.

During the March 2024 half, $2,435 million of assets were transferred from Level 1 to Level 2, (Sep 23: $3,624 million; Mar 23: $7,246 million), and $4,082 million of assets were transferredfrom Level 2 to Level 1 (Sep 23: $1,452 million; Mar 23: $1,181 million) due to a change of the observability of bond valuation inputs. There were no other material transfers during theperiod. Transfers into and out of levels are measured at the beginning of the reporting period in which the transfer occurred.

102

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
13.

Fair value of financial assets and financial liabilities, cont’d

Fair Value Measurements Incorporating Unobservable Market Dataa)Level 3 fair value measurements

Level 3 financial instruments are a net asset of $1,995 million (Sep 23: $2,128 million; Mar 23: $1,842 million). The assets and liabilities which incorporatesignificant unobservable inputs are:•equity and debt securities for which there is no active market or traded prices cannot be observed;•

loans and advances measured at fair value for which there is no observable market data; and•derivatives referencing market rates that cannot be observed primarily due to lack of market activity.

Level 3 Transfers
There were no transfers into or out of Level 3 during the period.
The material Level 3 financial instruments as at 31 March 2024 are summarised below:i)

Investment Securities - equity holdings classified as FVOCIBank of Tianjin (BoT)The Group holds an investment in the Bank of Tianjin. The investment is valued based on comparative price-to-book (P/B) multiples (a P/B multiple is theratio of the market value of equity to the book value of equity). The extent of judgement applied in determining the appropriate multiple and comparatorgroup from which the multiple is derived resulted in the Level 3 classification. As at March 2024, the BoT equity holding balance was $848 million(Sep 23: $849 million, Mar 23: $900 million).
Other equity investments
The Group holds $521 million (Sep 23: $535 million; Mar 23: $545 million) of unlisted equities classified as FVOCI, for which there are no active markets
or traded prices available, resulting in a Level 3 classification. The decrease in unlisted equity holdings balance was mainly due to downward revaluationof the equity instruments during the March 2024 half.
ii) Net loans and advances - classified as FVTPL
Syndicated loans
The Group holds $599 million (Sep 23: $729 million; Mar 23: $380 million) of syndicated loans for sale which are measured at FVTPL for which there isno observable market data available. The decrease in the Level 3 loan balances for the March 2024 half was mainly due to foreign currency translation
impacts as well as scheduled repayments.
b) Sensitivity to Level 3 data inputs
When we make assumptions due to significant inputs to a valuation not being directly observable (Level 3 inputs), then changing these assumptions
changes the Group’s estimate of the instrument’s fair value. Favourable and unfavourable changes are determined by changing the primary
unobservable parameters used to derive the fair valuation.
Investment securities - equity holdings
The valuations of the equity investments are sensitive to variations in selected unobservable inputs, with valuation techniques used including P/B
multiples and discounted cashflow techniques. If for example, a 10% increase or decrease to the primary input into the valuations were to occur (such as
the P/B multiple), it would result in a $137 million increase or decrease in the fair value of the portfolio, which would be recognised in shareholders’ equity
in the Group, with no impact to net profit or loss.
Net loans and advances
Syndicated loan valuations are sensitive to credit spreads in determining their fair valuation. For the syndicated loans which are primarily investmentgrade loans, an increase or decrease in credit spreads would have an immaterial impact on net profit or net assets of the Group. For the remaining
syndicated loans, the Group may, where deemed necessary, utilise Credit Risk Insurance to mitigate the credit risks associated with those loans. The
effect of this would also result in an immaterial impact to the net profit or net assets of the Group.
Other
The remaining Level 3 balance is immaterial and changes in inputs have a minimal impact on net profit and net assets of the Group.
c)

Deferred fair value gains and losses

Where fair value is determined using unobservable inputs significant to the fair value of a financial instrument, the Group does not immediately recognise
the difference between the transaction price and the amount determined based on the valuation technique (day one gain or loss) in profit or loss. Afterinitial recognition, the Group recognises the deferred amount in profit or loss on a straight-line basis over the life of the transaction or until all inputs
become observable. Day one gains and losses which have been deferred are not material.

103

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
13.

Fair value of financial assets and financial liabilities, cont’dFinancial Assets and Liabilities Not Measured at Fair Value
The financial assets and financial liabilities listed below are measured at amortised cost on the Group’s balance sheet. While this is the value at which we
expect the assets will be realised and the liabilities settled, the Group provides an estimate of the fair value of the financial assets and financial liabilities
at balance date in the table below.
Fair values of financial assets and liabilities carried at amortised cost not included in the table below approximate their carrying values. These financial
assets and liabilities are either short term in nature or are floating rate instruments that are re-priced to market interest rates on or near the end of thereporting period.

Carrying amount in the balance sheet

Fair value

At amortisedcost$M

At fair
value
$M

Total
$M

$M

Investment securities1

7,900

110,155

118,055

118,053

Net loans and advances691,144

24,027715,171

714,284

Total

699,044

134,182

833,226

832,337

Deposits and other borrowings

776,650

30,087806,737

806,542

Debt issuances

125,362

1,747

127,109

127,921

Total

902,01231,834

933,846

934,463

Investment securities1

7,752

89,67797,42997,389Net loans and advances

685,156

21,888707,044704,977

Total

692,908

111,565

804,473

802,366

Deposits and other borrowings

780,82233,889814,711814,503

Debt issuances

114,678

1,336

116,014

115,989Total

895,500

35,225

930,725

930,492

Investment securities1

7,912

86,06093,972

93,958Net loans and advances

670,618

19,469690,087

687,457

Total

678,530

105,529784,059

781,415

Deposits and other borrowings

811,236

31,328842,564

842,215

Debt issuances

104,626

1,531

106,157

105,800

Total

915,862

32,859948,721948,015

As at March 2024
Financial assets

Financial liabilities

As at September 2023
Financial assets

Financial liabilities

As at March 2023
Financial assets

Financial liabilities

1.

Investment securities at amortised cost includes $5,262 million of assets that are part of the Group’s liquidity portfolio (Sep 23: $4,558 million; Mar 23: $4,260 million). These are all shorttenor (<1 year) instruments primarily in the Group’s Rest of World geography and represent <2% of the Group’s total liquid asset securities at 31 March 2024.

104

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
14.

Shareholders’ equity

Shareholders' Equity
As at
Shareholders' equity
Ordinary share capital
Reserves
Foreign currency translation reserve1

Movement

Mar 24$M
29,033

Sep 23$M
29,082

Mar 23$M
29,054

Mar 24v. Sep 23
0%

Mar 24v. Mar 23
0%

192

570

644

-66%

-70%

74

83

58

-11%

28%

(590)

(494)

(412)

19%

43%

(1,120)(1,872)(1,287)

-40%

-13%

(22)

(22)

(22)

0%

0%

Total reserves(1,466)(1,735)(1,019)-16%

44%

Retained earnings

42,73942,14841,020

1%

4%

Share capital and reserves attributable to shareholders of the Company

70,30669,49569,055

1%

2%

Share option reserve
FVOCI reserve
Cash flow hedge reserve
Transactions with non-controlling interests reserve

Non-controlling interests
Total shareholders' equity
1.

768

522

525

47%

46%

71,07470,017

69,5802%

2%

As a result of the closure of a number of international entities, the associated foreign currency translation reserve was recycled from Other comprehensive income to profit or loss, resulting
in a $20 million gain recognised in Other operating income in the March 2024 half (Sep 23 half: $43 million gain; Mar 23 half: nil).

Ordinary Share Capital
As atOrdinary shares
Opening balance

Mar 24No.
3,005,286,886

Sep 23No.
3,003,366,782

Mar 23
No.
2,989,923,751

Bonus option plan

2,223,792

1,920,104

1,657,422

Dividend reinvestment plan issuances--

8,406,978

Employee share and option plans--

3,378,631

3,007,510,678

3,005,286,886

3,003,366,782(5,572,694)(4,044,925)(4,099,015)

3,001,937,984

3,001,241,961

2,999,267,767

Closing balanceLess: Treasury shares
Closing balance

Non-Controlling Interests

ANZ Bank New Zealand PPS1

Profit attributable tonon-controlling interests

Equity attributable tonon-controlling interests

Dividend paid to
non-controlling interests

Half YearAs at

Half Year

Mar 24$M
13

Sep 23$M
13

Mar 23$M
13

Mar 24$M757

Sep 23$M
512

Mar 23$M
515

Mar 24$M
13

Sep 23$M
13

Mar 23$M
13

Other non-controlling interests

1

1

1

11

10

10

-

1

-

Total

14

14

14

768

522

525

13

14

13

1.

On 19 March 2024, ANZ Bank New Zealand Limited issued $256 million (NZD 275 million) of PPS.

ANZ Bank New Zealand Perpetual Preference Shares
Perpetual Preference Shares (PPS) issued by ANZ Bank New Zealand Limited (ANZ Bank New Zealand), a member of the Group, are considered noncontrolling interests of the Group.
The key terms of the PPS are as follows:
PPS dividends
Holders of PPS are entitled to receive dividends that are discretionary, non-cumulative and subject to conditions. If a PPS dividend is not paid, there arecertain restrictions on the ability of the Bank to pay a dividend on its ordinary shares. Holders of the PPS have no other rights to participate in the profits
or property of ANZ Bank New Zealand.
Redemption features
Holders of PPS have no right to require that the PPS be redeemed. ANZ Bank New Zealand may, at its option, redeem PPS on an optional redemption
date (being each scheduled quarterly dividend payment date from the first optional redemption date), or at any time following the occurrence of a tax
event or regulatory event, subject to prior written approval of RBNZ and certain other conditions being met.

105

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
15.

Changes in composition of the Group

There were no acquisitions or disposals of material controlled entities for the half year ended 31 March 2024.

16.

Investments in associates
Half Year
Mar 24$M
84

Share of associates' profit/(loss)

Contributions to profit

Sep 23$M
120

Movement
Mar 23$M101

Mar 24v. Sep 23-30%

Mar 24v. Mar 23-17%

Contribution toGroup profit after tax

Ownership interest
held by Group

Half Year

As at

Associates
Mar 24$M
31

Sep 23$M
67

AMMB Holdings Berhad (AmBank)1

65

58

63

5

22

22

Worldline Australia Pty Ltd

(12)

(4)

(17)

49

49

49

n/a

n/a

n/a

P.T. Bank Pan Indonesia (PT Panin)

Other associates
Share of associates' profit/(loss)
1.

Mar 23
$M
56

-

(1)

(1)

84

120

101

Mar 24%39

Sep 23%
39

Mar 23%39

On 6 March 2024, the Group partially disposed of its interest in AmBank, reducing its investment by $668 million and its ordinary share interest from 22% to 5%. Following the decrease inownership, the Group ceased equity accounting for AmBank and reclassified the investment of $221 million as Investment securities at fair value through other comprehensive income.

17.

Related party disclosure

There have been no transactions with related parties that are significant to understanding the changes in financial position and performance of the Groupsince 30 September 2023.

106

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
18.

Commitments, contingent liabilities and contingent assets

Credit Related Commitments and Contingencies
Half Year

Movement

Mar 24$M

Sep 23$M

Mar 23$M

Mar 24v. Sep 23

Mar 24v. Mar 23

Undrawn facilities

239,898

240,711

243,9750%-2%Guarantees and letters of credit

23,39023,55623,090-1%

1%

Contract amount of:

Performance related contingencies

26,932

26,61526,259

1%

3%

Total

290,220

290,882

293,324

0%-1%

Other Contingent Liabilities and Contingent Assets
There are outstanding court proceedings, claims and possible claims for and against the Group. Where relevant, expert legal advice has been obtained
and, in the light of such advice, provisions and/or disclosures as deemed appropriate have been made. In some instances, we have not disclosed theestimated financial impact of the individual items either because it is not practicable to do so or because such disclosure may prejudice the interests of
the Group.
Refer to Note 34 of the 2023 ANZGHL Annual Financial Report for a description of commitments, contingent liabilities and contingent assets as at
30 September 2023. A description of the contingent liabilities and contingent assets as at 31 March 2024 is set out below.
Other Contingent Liabilities•

Regulatory and customer exposures
The Group regularly engages with its regulators in relation to regulatory investigations, surveillance and reviews, reportable situations, civil
enforcement actions (whether by court action or otherwise), formal and informal inquiries and regulatory supervisory activities in Australia andglobally. The Group has received various notices and requests for information from its regulators as part of both industry-wide and Group-specificreviews and has also made disclosures to its regulators at its own instigation. The nature of these interactions can be wide ranging and, for example,
include or have included in recent years a range of matters including responsible lending practices, regulated lending requirements, productsuitability and distribution, interest and fees and the entitlement to charge them, customer remediation, wealth advice, insurance distribution, pricing,competition, conduct in financial markets and financial transactions, capital market transactions, anti-money laundering and counter-terrorism
financing obligations, privacy obligations and information security, business continuity management, reporting and disclosure obligations and productdisclosure documentation. There may be exposures to customers which are additional to any regulatory exposures. These could include classactions, individual claims or customer remediation or compensation activities. The outcomes and total costs associated with such reviews andpossible exposures remain uncertain.

•

South African rate action
In February 2017, the South African Competition Commission commenced proceedings against local and international banks including ANZBGL
alleging breaches of the cartel provisions of the South African Competition Act in respect of trading in the South African rand. The potential civil
penalty or other financial impact is uncertain.

•

Capital raising action
In September 2018, the Australian Securities and Investments Commission (ASIC) commenced civil penalty proceedings against ANZBGL alleging
failure to comply with continuous disclosure obligations in connection with ANZBGL’s August 2015 underwritten institutional share placement. In
October 2023, the Federal Court of Australia found that ANZBGL should have notified the ASX of the joint lead managers’ take-up of placement
shares. A civil penalty of $0.9 million was imposed on ANZBGL. In December 2023, ANZBGL lodged a Notice of Appeal from the decision of theFederal Court of Australia.

•

Esanda dealer car loan litigation
In August 2020, a class action was brought against ANZBGL alleging unfair conduct, misleading or deceptive conduct and equitable mistake inrelation to the use of flex commissions in dealer arranged Esanda car loans. ANZBGL is defending the allegations.

•

OnePath superannuation litigation
In December 2020, a class action was brought against OnePath Custodians, OnePath Life and ANZBGL alleging that OnePath Custodians breached
its obligations under superannuation legislation, and its duties as trustee, in respect of superannuation investments and fees. The claim also allegesthat ANZBGL was involved in some of OnePath Custodians’ investment breaches. ANZBGL is defending the allegations.

•

New Zealand loan information litigation
In September 2021, a representative proceeding was brought against ANZ Bank New Zealand Limited, alleging breaches of disclosure requirements
under consumer credit legislation in respect of variation letters sent to certain loan customers. ANZ Bank New Zealand Limited is defending theallegations.

•Credit cards litigation
In November 2021, a class action was brought against ANZBGL alleging that certain interest terms in credit card contracts were unfair contract terms
and that it was unconscionable for ANZBGL to rely on them. An agreement to settle the claim was reached in March 2024. ANZBGL will pay$57.5 million in the settlement, which is covered by an existing provision. The settlement is without admission of liability and remains subject to court
approval.

107

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
18.
•

Commitments, contingent liabilities and contingent assets, cont’dRoyal Commission
The Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry released its final report on 4 February 2019.
Following the Royal Commission there have been, and continue to be, additional costs and further exposures, including exposures associated withfurther regulator activity or potential customer exposures such as class actions, individual claims or customer remediation or compensation activities.
The outcomes and total costs associated with these possible exposures remain uncertain.

•

Security recovery actions
Various claims have been made or are anticipated, arising from security recovery actions taken to resolve impaired assets. These claims will bedefended.

•Warranties, indemnities and performance management fees
The Group has provided warranties, indemnities and other commitments in favour of the purchaser and other persons in connection with various
disposals of businesses and assets and other transactions, covering a range of matters and risks. It is exposed to claims under those warranties,
indemnities and commitments, some of which are currently active. The outcomes and total costs associated with these exposures remain uncertain.
The Group has entered an arrangement to pay performance management fees to external fund managers in the event predetermined performance
criteria are satisfied in relation to certain Group investments. The satisfaction of the performance criteria and associated performance management
fee remains uncertain.

•

Clearing and settlement obligations
Certain group companies have a commitment to comply with rules governing various clearing and settlement arrangements which could result in a
credit risk exposure and loss if another member institution fails to settle its payment clearing activities. The Group’s potential exposure arising fromthese arrangements is unquantifiable in advance.
Certain group companies hold memberships of central clearing houses, including ASX Clear (Futures), London Clearing House (LCH) SwapClear
and RepoClear, Korea Exchange (KRX), Hong Kong Exchange (HKEX), Clearing Corporation of India and the Shanghai Clearing House. These
memberships allow the relevant group company to centrally clear derivative instruments in line with cross-border regulatory requirements. Common
to all of these memberships is the requirement for the relevant group company to make default fund contributions. In the event of a default by anothermember, the relevant group company could potentially be required to commit additional default fund contributions which are unquantifiable inadvance.

•Parent entity guarantees
Certain group companies have issued letters of comfort and guarantees in respect of certain subsidiaries in the normal course of business. Under
these letters and guarantees, the issuing entity undertakes to ensure that those subsidiaries continue to meet their financial obligations, subject tocertain conditions including that the subsidiary remains a controlled entity.

•

Sale of Grindlays businessOn 31 July 2000, ANZBGL completed the sale to Standard Chartered Bank of ANZ Grindlays Bank Limited (Grindlays) and certain other businesses.
ANZBGL provided warranties and indemnities relating to those businesses.
The indemnified matters include civil penalty proceedings brought by Indian authorities against Grindlays and certain of its officers, in relation tocertain transactions conducted in 1991 that are alleged to have breached the Foreign Exchange Regulation Act,1973. Civil penalties were imposed in2007 which are the subject of appeals.

Contingent Assets•

National Housing BankANZBGL is pursuing recovery of the proceeds of certain disputed cheques which were credited to the account of a former Grindlays customer in theearly 1990s.
The disputed cheques were drawn on the National Housing Bank (NHB) in India. Proceedings between Grindlays and NHB concerning the proceedsof the cheques were resolved in early 2002.
Recovery is now being pursued from the estate of the Grindlays customer who received the cheque proceeds. Any amounts recovered are to beshared between ANZBGL and NHB.

108

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
19.

Pending organisational changes impacting future reporting periods

Suncorp Bank Acquisition
On 18 July 2022, the Group announced an agreement to purchase 100% of the shares in SBGH Limited, the immediate non-operating holding companyof Suncorp Bank. On 20 February 2024, the Australian Competition Tribunal announced it had authorised the proposed acquisition following the decisionin August 2023 by the Australian Competition and Consumer Commission to not authorise the acquisition. The acquisition remains subject to satisfactionof certain conditions, including Federal Treasurer approval and certain amendments to the State Financial Institutions and Metway Merger Act 1996
(QLD). ANZBGL will also have a termination right under the Suncorp Bank Sale Agreement if APRA issues a written communication to ANZBGL under orin connection with APS 222 Associations with Related Entities to the effect that ANZBGL must not proceed with completion of the acquisition. Assumingthese conditions are satisfied, the acquisition is expected to occur in mid-calendar year 2024.

20.

Significant events since balance date

There have been no significant events from 31 March 2024 to the date of signing this report.

109

DIRECTORS’ DECLARATION
Directors’ Declaration
The Directors of ANZ Group Holdings Limited declare that:1.

2.

in the Directors’ opinion the Condensed Consolidated Financial Statements and Notes to the Condensed Consolidated Financial Statements are inaccordance with the Corporations Act 2001, including:•section 304, that they comply with the Australian Accounting Standards and any further requirements in the Corporations Regulations 2001;
and•section 305, that they give a true and fair view of the financial position of the Group as at 31 March 2024 and of its performance for the halfyear ended on that date; andin the Directors’ opinion as at the date of this declaration there are reasonable grounds to believe that the Company will be able to pay its debts as
and when they become due and payable.

Signed in accordance with a resolution of the Directors.

Paul D O’Sullivan
ChairmanShayne C ElliottManaging Director

6 May 2024

110

AUDITOR’S REVIEW REPORT AND INDEPENDENCE DECLARATION

Independent Auditor’s Review Report to the shareholders of ANZ Group Holdings Limited
Conclusion
We have reviewed the accompanying Condensed Consolidated Financial Statements of ANZ Group Holdings Limited (the Group).
Based on our review, which is not an audit, we have not become aware of any matter that makes us believe that the Condensed Consolidated Financial
Statements of ANZ Group Holdings Limited do not comply with the Corporations Act 2001, including:•giving a true and fair view of the Group’s financial position as at 31 March 2024 and of its performance for the half year ended on that date; and•complying with Australian Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001.

The Condensed Consolidated Financial Statements comprise:•

The condensed consolidated balance sheet as at 31 March 2024;•

The condensed consolidated income statement, condensed consolidated statement of comprehensive income, condensed consolidated statementof changes in equity, and condensed consolidated cash flow statement for the half year ended on that date;•Notes 1 to 20 including selected explanatory notes; and•The Directors’ Declaration.

The Group comprises ANZ Group Holdings Limited (the Company) and the entities it controlled at the half year’s end or from time to time during the half
year.
Basis for Conclusion
We conducted our review in accordance with ASRE 2410 Review of a Financial Report Performed by the Independent Auditor of the Entity and ISRE
2410 Review of Interim Financial Information Performed by the Independent Auditor of the Entity. Our responsibilities are further described in the
Auditor’s Responsibilities for the Review of the Financial Report section of our report.
We are independent of the Group in accordance with the auditor independence requirements of the Corporations Act 2001 and the ethical requirementsof the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (including IndependenceStandards) (the Code) that are relevant to our audit of the annual report in Australia. We have also fulfilled our other ethical responsibilities in accordancewith these requirements.
Responsibilities of the Directors for the Condensed Consolidated Financial Statements
The Directors of the Company are responsible for:•the preparation of the Condensed Consolidated Financial Statements that give a true and fair view in accordance with Australian AccountingStandards and the Corporations Act 2001; and•such internal control as the Directors determine is necessary to enable the preparation of the Condensed Consolidated Financial Statements thatgive a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor’s responsibility for the review of the Condensed Consolidated Financial Statements
Our responsibility is to express a conclusion on the Condensed Consolidated Financial Statements based on our review. ASRE 2410 and ISRE 2410
require us to conclude whether we have become aware of any matter that makes us believe that the Condensed Consolidated Financial Statements do
not comply with the Corporations Act 2001 including giving a true and fair view of the Group’s financial position as at 31 March 2024 and its performancefor the half year ended on that date, and complying with Australian Accounting Standard AASB 134 Interim Financial Reporting and the Corporations
Regulations 2001.
A review of Condensed Consolidated Financial Statements consists of making enquiries, primarily of persons responsible for financial and accounting
matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with
Australian Auditing Standards and International Standards on Auditing and consequently does not enable us to obtain assurance that we would becomeaware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

KPMG

Maria Trinci
Partner
Melbourne
6 May 2024

KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All right reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation. Liability limited by ascheme approved under Professional Standards Legislation.

111

AUDITOR’S REVIEW REPORT AND INDEPENDENCE DECLARATION

Lead Auditor’s Independence Declaration under Section 307C of the Corporations Act 2001
To the Directors of ANZ Group Holdings Limited
I declare that, to the best of my knowledge and belief, in relation to the review of ANZ Group Holdings Limited for the half year ended 31 March 2024,
there have been:(i)no contraventions of the auditor independence requirements as set out in the Corporations Act 2001 in relation to the review; and(ii)

no contraventions of any applicable code of professional conduct in relation to the review.

KPMG

Maria Trinci
Partner
Melbourne
6 May 2024

KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All right reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation. Liability limited by ascheme approved under Professional Standards Legislation.

112

SUPPLEMENTARY INFORMATIONCONTENTS

Page

Capital management

114

Average balance sheet and related interest

118

Select geographical disclosures

121

Exchange rates

122

113

SUPPLEMENTARY INFORMATION
Capital management

ANZ provides information as required under APRA’s prudential standard APS 330: Public Disclosure. This information is located in the Regulatory
Disclosures section of ANZ’s website: https://www.anz.com/shareholder/centre/reporting/regulatory-disclosure/.
The disclosures below represent the position for ANZ BH Pty Ltd as the head of ANZ’s Level 2 banking group. The capital position for ANZGHL, the headof the Level 3 conglomerate group, is outlined on page 37.
As atQualifying Capital

Movement

Mar 24$M

Sep 23$M

Mar 23$M

Mar 24v. Sep 23

Mar 24v. Mar 23

Tier 1
Shareholders' equity and non-controlling interests
Prudential adjustments to shareholders' equity

70,202

69,08568,5962%

2%

Table 1

(648)

(396)

(329)

64%

97%

69,554

68,68968,267

1%

2%

Table 2

(11,142)(10,895)(10,887)2%

2%

58,412

57,794

57,3801%

2%Gross Common Equity Tier 1 capital
Deductions
Common Equity Tier 1 capital
Additional Tier 1 capital

Table 3

8,297

8,232

8,184

1%

1%

66,70966,02665,5641%

2%

28,223

24,95924,06813%

17%94,932

90,98589,632

4%

6%

Common Equity Tier 1

13.5%

13.3%

13.2%

Tier 1

15.4%

15.2%

15.1%

0%

-1%

Tier 1 capital
Tier 2 capital

Table 4

Total qualifying capital
Capital adequacy ratios (Level 2)

Tier 2

6.5%

5.8%

5.5%

Total capital ratio

21.9%

21.0%

20.6%

432,779

433,327

435,514

Risk weighted assets

Table 5114

SUPPLEMENTARY INFORMATION
Capital management, cont’d
As at

Movement

Mar 24$M

Sep 23$M

Mar 23$M

Mar 24v. Sep 23

Mar 24v. Mar 23

Shareholders' equity attributable to deconsolidated entities

(225)

(253)

(233)

-11%

-3%

Deferred fee revenue including fees deferred as part of loan yields

409

430

453

-5%

-10%

Non-controlling interests and other deductions

(832)

(573)

(549)

45%

52%

Total

(648)

(396)

(329)

64%

97%

Unamortised goodwill & other intangibles (excluding ANZ New ZealandInvestments Holdings Ltd)(2,936)(2,977)(2,994)-1%-2%

Intangible component of investments in ANZ New Zealand Investments
Holdings Ltd

(69)

(71)

(71)

-3%

-3%

Table 1: Prudential adjustments to shareholders' equity

Table 2: Deductions from Common Equity Tier 1 capital

(902)

(913)

(868)

-1%

4%

Capitalised expenses (including loan and lease origination fees)(2,240)(2,099)(1,874)

7%

20%

Applicable deferred net tax assets(2,716)(2,579)(2,461)

5%

10%

(282)

(272)

(39)

4%

large

(225)

(225)

(284)

0%

-21%

Capitalised software

Expected losses in excess of eligible provisions

Table 8Investment in other insurance subsidiaries

(45)

(46)

(45)

-1%

0%

Investment in associates(1,405)(2,321)(2,214)

-39%

-37%

Other equity investments(1,168)

(925)

(973)

26%

20%

Investment in ANZ New Zealand Investments Holdings Ltd

Cash flow hedge reserve and other deductions
Total

846

1,533

936

-45%

-10%

(11,142)(10,895)(10,887)

2%

2%

Table 3: Additional Tier 1 capital
ANZ Capital Notes 4

-

1,621

1,620

large

large

ANZ Capital Notes 5

930

929

929

0%

0%

ANZ Capital Notes 6

1,490

1,489

1,488

0%

0%

ANZ Capital Notes 7

1,299

1,298

1,297

0%

0%

ANZ Capital Notes 8

1,484

1,483

1,482

0%

0%

ANZ Capital Notes 9

1,678

-

-

n/a

n/a

ANZ Capital Securities

1,434

1,412

1,380

2%

4%

(18)

-

(12)

n/a

50%

8,297

8,232

8,184

1%

1%

-10%

Regulatory adjustments and deductions
Total

`

Table 4: Tier 2 capital
General reserve for impairment of financial assets

1,609

1,776

1,781

-9%

Term subordinated debt notes

26,75423,707

22,797

13%

17%

(140)

(524)

(510)

-73%

-73%

28,223

24,95924,06813%

17%

Regulatory adjustments and deductions
Total

115

SUPPLEMENTARY INFORMATION
Capital management, cont’d

As at

Movement

Mar 24$M

Sep 23$M

Mar 23$M

Mar 24v. Sep 23

Mar 24v. Mar 23

Table 5: Risk weighted assets
On balance sheet

277,535

272,493

269,191

2%

3%

Commitments

41,42447,70145,944-13%-10%

Contingents

11,80012,26014,227-4%-17%

Derivatives

17,688

16,587

15,932

7%

11%348,447

349,041

345,2940%1%Market risk - Traded

11,863

10,264

11,73716%

1%

Market risk - IRRBB

26,20031,70331,887-17%-18%

Operational risk

43,27442,31942,3192%

2%

Total risk weighted assets

429,784

433,327

431,237

-1%

0%

2,995

-

4,277

n/a

-30%

432,779

433,327

435,5140%-1%

Total credit risk weighted assets

Table 6

RWA adjustment for the IRB capital floor
Total risk weighted assets including floor adjustment

As at

Movement

Mar 24$M

Sep 23$M

Mar 23$M

Mar 24v. Sep 23

Corporate

60,362

62,66862,680-4%-4%

Residential mortgage

101,338

96,29086,726

5%

17%

Retail SME

9,538

9,684

10,065-2%-5%Qualifying revolving retail

3,344

3,243

3,325

3%

1%

Other retail

1,664

1,644

1,709

1%

-3%

176,246

173,529

164,505

2%

7%

3,579

3,369

3,577

6%

0%

Corporate

35,66534,81938,8082%-8%

Sovereign

10,856

10,252

11,1996%-3%

Financial institution

30,12230,87532,832-2%-8%Credit risk weighted assets subject to Foundational IRB approach

76,64375,946

82,8391%-7%

Corporate

5,102

5,611

4,911

-9%

4%

Sovereign

171

165

88

4%

94%

1,853

2,065

1,809

-10%

2%

Mar 24v. Mar 23

Table 6: Credit risk weighted assets by Basel asset class
Subject to Advanced IRB approach

Credit risk weighted assets subject to Advanced IRB approach

Credit risk weighted assets subject to supervisory slotting approach

Subject to Foundation IRB approach

Subject to Standardised approach

Residential mortgage
Other retail

92

44

32

large

large

Other assets

3,790

3,255

4,138

16%

-8%

Credit risk weighted assets subject to Standardised approach

11,008

11,14010,978-1%0%Credit Valuation Adjustment and Qualifying Central Counterparties

5,304

4,000

3,449

33%

54%

Exposures of New Zealand banking subsidiaries

73,18678,662

77,717-7%-6%

Credit risk weighted assets relating to securitisation exposures
Total credit risk weighted assets

116

2,481

2,395

2,229

4%

11%

348,447

349,041

345,294

0%1%

SUPPLEMENTARY INFORMATION
Capital management, cont’dCollectively and Individually
Assessed Provision

Table 7: Total provision for credit impairment and Basel expected loss
by division

Basel Expected Loss1

Australia RetailMar 24$M
1,009

Sep 23$M
1,017

Mar 23$M
1,017

Mar 24$M939

Sep 23$M855

Mar 23$M
824

Australia Commercial

1,171

1,168

1,182

651

631

657

Institutional

1,546

1,551

1,580

960

957

814

New Zealand

580

600

590

622

579

515

Pacific

65

72

91

15

16

17

Group Centre
Total provision for credit impairment and expected loss
1.

-

-

1

1

1

2

4,371

4,408

4,461

3,188

3,039

2,829

Only applicable to IRB portfolios.

As at

Movement

Table 8: APRA Expected loss in excess of eligible provisions

Mar 24$M

Sep 23$M

Mar 23$M

Mar 24v. Sep 23

Mar 24v. Mar 23

APRA Basel 3 expected loss: non-defaulted

2,014

1,902

1,875

6%

7%

Less: Qualifying collectively assessed provisionCollectively assessed provision(4,046)(4,032)(4,040)0%0%

Non-qualifying collectively assessed provision

423

354

384

19%

10%

Standardised collectively assessed provision

137

131

141

5%

-3%

-

-

-

n/a

n/a

1,174

1,137

954

3%

23%

Individually assessed provision

(325)

(376)

(421)

-14%

-23%

Additional individually assessed provision for partial write offs

(186)

(181)

(181)

3%

3%

31

31

44

0%

-30%

(412)

(339)

(357)

22%

15%

282

272

39

4%

large

Non-defaulted excess included in deduction
APRA Basel 3 expected loss: defaulted
Less: Qualifying individually assessed provision

Standardised individually assessed provisionCollectively assessed provision on IRB defaulted

-

-

-

n/a

n/a

Defaulted excess included in deduction

Shortfall in expected loss not included in deduction

282

272

39

4%

large

Gross deduction

282

272

39

4%

large

117

SUPPLEMENTARY INFORMATION
Average balance sheet and related interest1
Mar 24 Half YearSep 23 Half Year

Mar 23 Half YearAvg bal
$M

Int
$M

Rate
%

Avg bal
$M

Int
$M

Rate
%

Avg bal
$M

Int
$M

Rate
%

Home loans2

364,372

12,1176.7%

353,166

10,5996.0%

344,016

8,730

5.1%

Consumer finance3

12,718539

8.5%

12,309516

8.4%

12,320493

8.0%

Business lending4,5287,245

9,354

6.5%

285,084

9,360

6.5%

293,374

8,500

5.8%

Loans and advances

Individual provisions for credit impairment

(353)

-

n/a

(390)

-

n/a

(457)

-

n/a

663,982

22,0106.6%

650,169

20,4756.3%

649,253

17,723

5.5%

198,112

4,072

4.1%

199,013

3,720

3.7%

196,798

2,712

2.8%

152,962

3,724

4.9%

127,409

2,875

4.5%

126,358

2,393

3.8%

565

5

n/a

584

2

n/a

563

4

n/a

351,639

7,801

4.4%

327,006

6,597

4.0%

323,719

5,109

3.2%

Total interest earning assets6

1,015,621

29,811

5.9%

977,175

27,072

5.5%

972,972

22,832

4.7%

Non-interest earning assets2

147,375

138,155

139,344

1,162,996

1,115,330

1,112,316

Total5
Non-lending interest earning assets
Cash and other liquid assets
5

Trading and investment securities
Other assets
Total5

Total average assets
Interest bearing deposits and other borrowings
Certificates of deposit

45,046

1,064

4.7%

44,616935

4.2%

41,710674

3.2%

Term deposits

263,285

6,595

5.0%

245,976

5,712

4.6%

226,515

3,998

3.5%

On demand and short term deposits

311,662

6,536

4.2%

307,908

5,700

3.7%

317,740

4,268

2.7%

Deposits from banks and securities sold under agreement torepurchase

103,459

2,323

4.5%

102,873

2,107

4.1%

103,137

1,677

3.3%

7

Commercial paper and other borrowings

47,677

1,310

5.5%

33,938958

5.6%

43,553

883

4.1%

Total

771,129

17,828

4.6%

735,311

15,412

4.2%

732,655

11,5003.1%

Non-deposit interest bearing liabilities
Collateral received and settlement balances owed by ANZ

22,486324

2.9%

18,093317

3.5%

22,349271

2.4%

Debt issuances & subordinated debt

115,969

3,202

5.5%

107,461

2,750

5.1%

96,609

2,082

4.3%

Other liabilities

13,220558

n/a

10,509

519

n/a

9,293

479

n/a

Total

151,675

4,084

5.4%

136,063

3,586

5.3%

128,251

2,832

4.4%

Total interest bearing liabilities6

922,804

21,912

4.7%

871,374

18,9984.3%

860,906

14,332

3.3%

Non-interest bearing liabilities7

169,309175,260

183,799

1,092,113

1,046,634

1,044,705

70,883

68,696

67,611

Total average liabilities

Total average shareholders' equity
1.

Averages used are predominantly daily averages.
2. Home loans are reported net of average mortgage offset balances of $46,560 million (Sep 23: $43,923 million; Mar 23: $43,799 million), which are included in non-interest earning assets.
While these balances are required to be grossed up under accounting standards, they are netted down for the calculation of customer interest payments and the calculation of the Group’s
net interest margin.
3. Consumer finance includes retail products such as credit cards and personal loans, mainly held in the Australia Retail division.
4. Business lending includes commercial loans to small and mid-sized enterprises, in the Australia Commercial and New Zealand divisions, as well as larger corporate customers in theInstitutional division.
5. During the current period, a component of interest previously included in Business lending was reallocated to Trading and investment securities to better align with the average balance
allocation. Comparative information has been restated to conform to presentation in the current period reducing interest in Business lending by $451 million in the September 2023 half and$353 million in the March 2023 half with a corresponding increase in interest in Trading and investment securities.
6. Intra-group interest earning assets and interest income and Intra-group interest earning liabilities and interest expense have been eliminated.
7. On demand and short-term deposits exclude average mortgage offset balances of $46,560 million (Sep 23: $43,923 million; Mar 23: $43,799 million), which are included in non-interest
bearing liabilities.

118

SUPPLEMENTARY INFORMATION
Average balance sheet and related interest1, cont’dMar 24 Half YearSep 23 Half Year

Mar 23 Half YearAvg bal
$M

Int
$M

Rate
%

Avg bal
$M

Int
$M

Rate
%

Avg bal
$M

Int
$M

Rate
%

Loans and advances2
Australia

449,835

14,793

6.6%

434,528

13,4696.2%

432,682

11,721

5.4%

New Zealand3

139,952

4,664

6.7%

138,008

4,336

6.3%

136,061

3,651

5.4%

Rest of World4

74,195

2,553

6.9%

77,633

2,670

6.9%

80,510

2,351

5.9%

663,982

22,0106.6%

650,169

20,4756.3%

649,253

17,723

5.5%

78,777

1,858

4.7%

61,789

1,352

4.4%

62,933

1,151

3.7%

Total
Trading assets and investment securities
Australia
3

New Zealand

16,727444

5.3%

17,041427

5.0%

16,606344

4.2%

Rest of World4

57,458

1,422

4.9%

48,579

1,096

4.5%

46,819898

3.8%

152,962

3,724

4.9%

127,409

2,875

4.5%

126,358

2,393

3.8%

Australia

628,133

19,021

6.1%

596,787

16,962

5.7%

595,274

14,358

4.8%

New Zealand

170,005

5,494

6.5%

167,445

5,129

6.1%

166,510

4,290

5.2%

Rest of World

217,483

5,296

4.9%

212,943

4,981

4.7%

211,188

4,184

4.0%

1,015,621

29,811

5.9%

977,175

27,072

5.5%

972,972

22,832

4.7%

Total
Total interest earning assets5

Total
Total average assets
Australia

716,218

674,203

664,826

New Zealand

182,716

180,746

181,272

Rest of World

264,062

260,381266,218

Total average assets

1,162,996

1,115,330

1,112,316

Interest bearing deposits and other borrowings6
Australia

450,686

10,2204.5%

421,540

8,538

4.0%

415,469

6,202

3.0%

New Zealand

117,591

2,794

4.8%

113,210

2,440

4.3%

111,000

1,708

3.1%

Rest of World

202,852

4,815

4.7%

200,561

4,434

4.4%

206,186

3,590

3.5%

771,129

17,8294.6%

735,311

15,412

4.2%

732,655

11,5003.1%

Australia

562,945

13,275

4.7%

519,192

11,115

4.3%

504,444

8,137

3.2%

New Zealand

137,306

3,403

5.0%

134,551

3,075

4.6%

132,847

2,268

3.4%

Rest of World

222,553

5,234

4.7%

217,631

4,808

4.4%

223,615

3,927

3.5%

922,804

21,912

4.7%

871,374

18,9984.3%

860,906

14,332

3.3%

Total
Total interest bearing liabilities5

Total
Total average liabilities
Australia

656,885

617,283

599,344

New Zealand

163,322

161,797

163,248

Rest of World

271,906

267,554282,113

1,092,113

1,046,634

1,044,705

Ordinary share capital, reserves, retained earnings and noncontrolling interests

70,883

68,696

67,611

Total average shareholders' equity

70,883

68,696

67,611

1,162,996

1,115,330

1,112,316

Total average liabilities
Total average shareholders' equity

Total average liabilities and shareholders' equity
1.

Averages used are predominantly daily averages.
Home loans are reported net of average mortgage offset balances of $46,560 million (Sep 23: $43,923 million; Mar 23: $43,799 million), which are included in non-interest earning assets.
While these balances are required to be grossed up under accounting standards, they are netted down for the calculation of customer interest payments and the calculation of the Group’s
net interest margin.
3. During the current period, a component of interest in New Zealand previously included in Loans and advances was reallocated to Trading and investment securities to better align with theaverage balance allocation. Comparative information has been restated to conform to presentation in the current period reducing interest in Loans and advances by $148 million in the
September 2023 half and $116 million in the March 2023 half with a corresponding increase in interest in Trading and investment securities.
4. During the current period, a component of interest in Rest of World previously included in Loans and advances was reallocated to Trading and investment securities to better align with theaverage balance allocation. Comparative information has been restated to conform to presentation in the current period reducing interest in Loans and advances by $303 million in the
September 2023 half and $237 million in the March 2023 half with a corresponding increase in interest in Trading and investment securities.
5. Intra-group interest earning assets and interest income and Intra-group interest earning liabilities and interest expense have been eliminated.
6. On demand and short-term deposits exclude average mortgage offset balances of $46,560 million (Sep 23: $43,923 million; Mar 23: $43,799 million), which are included in non-interest
bearing liabilities.
2.

119

SUPPLEMENTARY INFORMATION
Average balance sheet and related interest, cont’d
Half Year
Mar 24%
6.20

Sep 23%
5.79

Mar 23%
5.03

New Zealand

6.46

6.11

5.17

Rest of World

5.23

5.03

4.20

Group

5.87

5.53

4.71

Gross earnings rate1
Australia

Net interest spread and net interest margin analysis as follows:
Half Year
Mar 24%
1.21

Sep 23%
1.26

Mar 23%
1.51

Interest attributable to net non-interest bearing items

0.42

0.51

0.42

Net interest margin - Australia

1.63

1.77

1.93

Net interest spread

1.48

1.52

1.71

Interest attributable to net non-interest bearing items

0.86

0.81

0.65

Net interest margin - New Zealand

2.34

2.33

2.36

Net interest spread

0.52

0.62

0.68

Interest attributable to net non-interest bearing items

0.26

0.21

0.19

Net interest margin - Rest of World

0.78

0.83

0.87

Net interest spread

1.12

1.18

1.37

Interest attributable to net non-interest bearing items

0.44

0.47

0.38

Net interest margin

1.56

1.65

1.75

Net interest margin (excluding Markets)

2.33

2.35

2.43

Australia1
Net interest spread

New Zealand

1

Rest of World1

Group

1.

Geographic gross earnings rate, net interest spread and net interest margin are calculated gross of intra-group items (Intra-group interest earning assets and associated interest income andintra-group interest bearing liabilities and associated interest expense).

120

SUPPLEMENTARY INFORMATION
Select geographical disclosures
The following divisions operate across the geographic locations illustrated below:• Australia Retail division - Australia• Australia Commercial division - Australia• Institutional division - Australia, New Zealand and Rest of World• Pacific division – Rest of World• New Zealand division - New Zealand• Group Centre division - Australia, New Zealand and Rest of WorldThe Rest of World geography includes all geographies in which the Group operates outside of Australia and New Zealand. This includes Asia, Pacific,
Europe & America.
Australia$M

New Zealand$M

Rest of World
$M

Total
$M
3,407

March 2024 Half Year
Statutory profit/(loss) attributable to shareholders of the Company

1,819

964

624

Cash profit/(loss)

1,871

1,073

608

3,552

Net loans and advances

502,745

138,647

73,779715,171

Customer deposits

389,967

124,156

126,967

641,090

Risk weighted assets

275,841

88,05868,880432,779

September 2023 Half Year
Statutory profit/(loss) attributable to shareholders of the Company

1,989

1,047

515

3,551

Cash profit/(loss)

2,013

1,068

503

3,584

Net loans and advances

488,859

139,286

78,899707,044

Customer deposits

378,388

123,368

145,363

647,119

Risk weighted assets

268,405

94,44670,476433,327

March 2023 Half Year
Statutory profit/(loss) attributable to shareholders of the Company

1,862

922

771

3,555

Cash profit/(loss)

2,059

1,018

752

3,829

Net loans and advances

473,874

138,044

78,169690,087

Customer deposits

369,574

122,008

157,045648,627

Risk weighted assets

262,828

95,93676,750435,514

New Zealand geography (in NZD)
Half Year
Mar 24
NZD M
2,142

Net interest income
Other operating income

Sep 23
NZD M
2,112

Movement
Mar 23
NZD M
2,127

Mar 24v. Sep 23
1%

Mar 24v. Mar 23
1%

382

411

363

-7%

5%

Operating income

2,524

2,523

2,490

0%

1%

Operating expenses

(859)

(850)

(809)

1%

6%

Cash profit before credit impairment and income tax

1,665

1,673

1,681

0%

-1%

(33)

(62)

(121)

-47%

-73%

Cash profit before income tax

Credit impairment (charge)/release

1,632

1,611

1,560

1%

5%

Income tax expense and non-controlling interests

(477)

(456)

(453)

5%

5%

Cash profit

1,155

1,155

1,107

0%

4%

Adjustments between statutory profit and cash profit

(117)

(22)

(105)

large

11%

Statutory profit

1,038

1,133

1,002

-8%

4%

Individually assessed credit impairment charge/(release)

3

37

23

-92%

-87%

Collectively assessed credit impairment charge/(release)

30

25

98

20%

-69%

Net loans and advances

151,167

149,627

147,423

1%

3%

Customer deposits

135,367

132,528130,297

2%

4%

Risk weighted assets

96,005

101,458

102,449-5%-6%

Total FTE

7,185

7,244

7,252

-1%

-1%

121

SUPPLEMENTARY INFORMATION
Exchange rates
Major exchange rates used in the translation of foreign subsidiaries, branches, investments in associates and issued debt are as follows:
Balance Sheet

Profit & Loss Average

As atHalf Year

Chinese Renminbi

Mar 244.7035

Sep 234.7265

Mar 234.6079Mar 244.7167

Sep 234.7137

Mar 234.6763Euro

0.60400.61120.61580.60540.60760.6409Pound Sterling

0.51570.5286

0.54190.5216

0.52550.5618

Indian Rupee

54.25653.72355.18854.40354.53055.069Indonesian Rupiah

10,331

10,017

10,051

10,235

9,952

10,315

Japanese Yen

98.51596.40989.28096.88093.07991.664

Malaysian Ringgit

3.07733.03192.95983.0822

3.02623.0018

New Taiwan Dollar

20.82920.87620.42520.702

20.632

20.696

New Zealand Dollar

1.0903

1.0742

1.06791.07611.08141.0877

Papua New Guinean Kina

2.45492.36922.36342.44132.35982.3589

United States Dollar

0.65080.64680.67120.65430.66150.6699122

DEFINITIONSAASB means Australian Accounting Standards Board. The term ‘AASB’ is commonly used when identifying Australian Accounting Standards issued by
the AASB.
ADI means Authorised Deposit-taking Institution as defined by APRA.
ANZ Bank Group means ANZ BH Pty Ltd and each of its subsidiaries, including ANZBGL and ANZ Bank New Zealand.
ANZBGL means Australia and New Zealand Banking Group Limited.
ANZBGL Group means ANZBGL and each of its subsidiaries.
ANZ Bank New Zealand means ANZ Bank New Zealand Limited.
ANZ Economics means ANZ Research Economics, a business unit within ANZ which conducts analysis of key economic inputs and developments andassessment of the potential impacts on the local, regional and global economies.
ANZGHL means ANZ Group Holdings Limited.
ANZGHL Group means ANZGHL and each of its subsidiaries, including ANZ BH Pty Ltd, ANZBGL, ANZ Group Services Pty Ltd and ANZ NBH Pty Ltd.
ANZ Non-Bank Group means ANZ NBH Pty Ltd and each of its subsidiaries, including ANZ’s beneficial interests in the 1835i trusts and non-controllinginterests in the Worldline merchant acquiring joint venture, and ANZ Group Services Pty Ltd.
APRA means Australian Prudential Regulation Authority.
APS means ADI Prudential Standard.
ASX means Australian Securities Exchange.
AT1 means Additional Tier 1 capital.
Board means ANZGHL Board of Directors.
BOP means Bonus Option Plan.
Cash and cash equivalents comprise coins, notes, money at call, balances held with central banks, liquid settlement balances (readily convertible to
known amounts of cash which are subject to insignificant risk of changes in value) and securities purchased under agreements to resell (reverse
repurchase agreements) in less than three months.
Cash profit is an additional measure of profit which is prepared on a basis other than in accordance with accounting standards. Cash profit represents
ANZ’s preferred measure of the result of the core business activities of the Group, enabling readers to assess Group and Divisional performance against
prior periods and against peer institutions. To calculate cash profit, the Group excludes non-core items from statutory profit as noted below. These items
are calculated consistently period on period so as not to discriminate between positive and negative adjustments.
Gains and losses are adjusted where they are significant, or have the potential to be significant in any one period, and fall into one of three categories:
1. gains or losses included in earnings arising from changes in tax, legal or accounting legislation or other non-core items not associated with the core
operations of the Group;
2. economic hedging impacts and similar accounting items that represent timing differences that will reverse through earnings in the future; and3. accounting reclassifications between individual line items that do not impact reported results, such as credit risk on impaired derivatives.
Cash profit is not a measure of cash flow or profit determined on a cash accounting basis.
Collectively assessed allowance for expected credit loss represents the expected credit loss, which incorporates forward-looking information anddoes not require an actual loss event to have occurred for a credit loss provision to be recognised.
Company means ANZGHL.
Credit risk is the risk of financial loss resulting from the failure of ANZ’s customers and counterparties to honour or perform fully the terms of a loan orcontract.
Credit risk weighted assets (credit RWA) represent assets which are weighted for credit risk according to a set formula as prescribed in APS 112/113.
Customer deposits represent term deposits, other deposits bearing interest, deposits not bearing interest and borrowing corporations’ debt excluding
securitisation deposits.
Dividend payout ratio is the total ordinary dividend payment divided by profit attributable to shareholders of the Company.
DRP means dividend reinvestment plan.
Embedded losses - In relation to interest rate risk in the banking book, APRA requires ADIs to give consideration to embedded gains or losses inbanking book items that are not accounted for on a marked-to-market basis when determining regulatory capital. The embedded loss or gain measuresthe difference between the book value and the economic value of banking book activities at a point in time.
Expected credit losses (ECL) – The determination of the ECL is dependent on credit deterioration since origination, according to the following threestage approach:- Stage 1: At the origination of a financial asset, and subsequently where there has not been a Significant Increase in Credit Risk (SICR) sinceorigination, an allowance for ECL is recognised reflecting the expected credit losses resulting from default events that are possible within the next 12months from the reporting date. For instruments with a remaining maturity of less than 12 months, expected credit losses are estimated based on
default events that are possible over the remaining time to maturity.
- Stage 2: Where there has been a SICR since origination, an allowance for ECL is recognised reflecting expected credit losses resulting from all
possible default events over the expected life of a financial instrument. If credit risk were to improve in a subsequent period such that the increase incredit risk since origination is no longer considered significant, the exposure returns to a Stage 1 classification with ECL measured accordingly.
- Stage 3: Where there is objective evidence of impairment, an allowance equivalent to lifetime ECL is recognised.
Exposure at default (EAD) means the expected balance sheet exposure at default taking into account repayments of principal and interest,
expected additional drawdowns and accrued interest.

123

DEFINITIONS
Funding for Lending Programme (FLP) refers to three-year funding announced by the RBNZ in November 2020 and offered to New Zealand banks,
which aimed to lower the cost of borrowing for New Zealand businesses and households.
GDP means gross domestic product.
Group means ANZGHL and each of its subsidiaries, including ANZ BH Pty Ltd, ANZBGL, ANZ Group Services Pty Ltd and ANZ NBH Pty Ltd.
Gross loans and advances (GLA) is made up of loans and advances, capitalised brokerage and other origination costs less unearned income.
Impaired assets are those financial assets where doubt exists as to whether the full contractual amount will be received in a timely manner, or whereconcessional terms have been provided because of the financial difficulties of the customer.
Impaired loans comprise drawn facilities where the customer’s status is defined as impaired.
Individually assessed allowance for expected credit losses is assessed on a case-by-case basis for all individually managed impaired assets taking
into consideration factors such as the realisable value of security (or other credit mitigants), the likely return available upon liquidation or bankruptcy, legal
uncertainties, estimated costs involved in recovery, the market price of the exposure in secondary markets and the amount and timing of expected
receipts and recoveries.
Interest rate risk in the banking book (IRRBB) relates to the potential adverse impact of changes in market interest rates on ANZ’s future net interest
income. The risk generally arises from:
1. Repricing and yield curve risk - the risk to earnings or market value as a result of changes in the overall level of interest rates and/or the relativity ofthese rates across the yield curve;
2. Basis risk - the risk to earnings or market value arising from volatility in the interest margin applicable to banking book items; and3. Optionality risk - the risk to earnings or market value arising from the existence of stand-alone or embedded options in banking book items.
Internationally comparable ratios are ANZ’s interpretation of Basel Calculation of RWA for credit risk regulations (effective 1 Jan 2023) documented in
the Basel Framework and the ‘Australian Banking Association Basel 3.1 Capital Comparison Study’ (Mar 2023). This definition is for measures fromMarch 2023 onwards.
IRB means internal ratings-based.
Probability of default (PD) means the estimate of the likelihood that a borrower will default over a given period.
Level 1 in the context of APRA supervision, means ANZBGL consolidated with certain approved subsidiaries.
Level 2 in the context of APRA supervision, means consolidated ANZ Bank Group, excluding insurance and funds management entities, commercial
non-financial entities and certain securitisation vehicles.
Level 3 in the context of APRA supervision, means ANZ Group, the conglomerate group at the widest level.
Loss given default (LGD) means the expected loss in the event of the borrower defaulting, expressed as a percentage of the facility's EAD,
taking into account direct and indirect recovery costs.
Net interest margin is net interest income as a percentage of average interest earning assets.
Net loans and advances represent gross loans and advances less allowance for expected credit losses.
Net Stable Funding Ratio (NSFR) is the ratio of the amount of available stable funding (ASF) to the amount of required stable funding (RSF) defined by
APRA. The amount of ASF is the portion of an ADI capital and liabilities expected to be a reliable source of funds over a one year time horizon. The
amount of RSF is a function of the liquidity characteristics and residual maturities of an ADI’s assets and off-balance sheet activities. ADIs must maintainan NSFR of at least 100%.
Net tangible assets equal share capital and reserves attributable to shareholders of the Company less unamortised intangible assets (including goodwill
and software).
NZX means New Zealand’s Exchange.
RBA means Reserve Bank of Australia, Australia’s central bank.
RBNZ means Reserve Bank of New Zealand, New Zealand’s central bank.
Regulatory deposits are mandatory reserve deposits lodged with local central banks in accordance with statutory requirements.
Return on average assets is the profit attributable to shareholders of the Company, divided by average total assets.
Return on average ordinary shareholders’ equity is the profit attributable to shareholders of the Company, divided by average ordinary shareholders’equity.
Risk weighted assets (RWA) are risk weighted according to each asset’s inherent potential for default and what the likely losses would be in the case ofdefault. In the case of non-asset backed risks (i.e. market and operational risk), RWA is determined by multiplying the capital requirements for those risks
by 12.5.
Settlement balances owed to/by ANZ represent financial assets and/or liabilities which are in the course of being settled. These may include trade
dated assets and liabilities, vostro accounts and securities settlement accounts.
Term Funding Facility (TFF) refers to three-year funding announced by the RBA on 19 March 2020 and offered to ADIs in order to support lending toAustralian businesses at low cost.
Term Lending Facility (TLF) refers to three to five-year funding offered by the RBNZ between May 2020 and July 2021 to promote lending to New
Zealand businesses.

124

DEFINITIONS
Description of divisions
The Group operates on a divisional structure with six divisions: Australia Retail, Australia Commercial, Institutional, New Zealand, Pacific, and Group
Centre.

Australia Retail
The Australia Retail division provides a full range of banking services to Australian consumers. This includes Home Loans, Deposits, Credit Cards andPersonal Loans. Products and services are provided via the branch network, home loan specialists, contact centres, a variety of self-service channels(digital and internet banking, website, ATMs and phone banking) and third-party brokers. It also includes the costs related to the development andoperation of the ANZ Plus proposition for retail customers.

Australia Commercial
The Australia Commercial division provides a full range of banking products and financial services, including asset financing, across the following
customer segments: SME Banking (small business owners and medium commercial customers), and Specialist Business (large commercial customers,
and high net worth individuals and family groups). It also includes run-off and divested businesses (Central Functions).

Institutional
The Institutional division services institutional and corporate customers, and governments across Australia, New Zealand and International (including
PNG) via the following business units:•

Transaction Banking provides customers with working capital and liquidity solutions including documentary trade, supply chain financing, commodity
financing as well as cash management solutions, deposits, payments and clearing.

•

Corporate Finance provides customers with loan products, loan syndication, specialised loan structuring and execution, project and export finance,
debt structuring and acquisition finance.

•

Markets provides customers with risk management services in foreign exchange, interest rates, credit, commodities and debt capital markets inaddition to managing the Group's interest rate exposure and liquidity position.

•

Central Functions consists of enablement functions that help deliver payments services, operational support and digital capability across both theInstitutional division and the wider enterprise.

New Zealand
The New Zealand division comprises the following business units:•

Personal provides a full range of banking and wealth management services to consumer and private banking customers. We deliver our services via
our internet and app-based digital solutions and network of branches, mortgage specialists, relationship managers and contact centres.

•

Business & Agri provides a full range of banking services through our digital, branch and contact centre channels, and traditional relationship banking
and sophisticated financial solutions through dedicated managers. These cover privately owned small, medium and large enterprises, the agriculturalbusiness segment, government and government-related entities.

•

Central Functions includes Treasury and back-office support functions.

Pacific
The Pacific division provides products and services to retail and commercial customers (including multi-nationals) and to governments located in the
Pacific region excluding PNG which forms part of the Institutional division.

Group Centre
Group Centre division provides support to the operating divisions, including technology, property, risk management, financial management, treasury,
strategy, marketing, human resources, corporate affairs, and shareholder functions. It also includes minority investments in Asia and interests in the ANZ
Non-Bank Group.

125

ASX APPENDIX 4D - CROSS REFERENCE INDEX

Page
Details of the reporting period (4D Item 1) ............................................................................................................................................................................. 2
Results for Announcement to the Market (4D Item 2) ............................................................................................................................................................ 2
Net Tangible Assets per security (4D Item 3) ....................................................................................................................................................................... 11
Details of entities over which control has been gained or lost (4D Item 4) ......................................................................................................................... 106
Dividends and dividend dates (4D Item 5) ............................................................................................................................................................................. 2
Dividend Reinvestment Plan (4D Item 6) ............................................................................................................................................................................... 2
Details of associates and joint venture entities (4D Item 7) ................................................................................................................................................ 106

126