ANZ National Bank Limited
Disclosure Statement
FOR THE NINE MONTHS ENDED 30 JUNE 2012 | NUMBER 66 ISSUED AUGUST 2012

ANZ National Bank Limited

Glossary of Terms

For the nine months ended 30 June 2012

In this Disclosure Statement unless the context otherwise
requires:

Contents(a) “Bank” means ANZ National Bank Limited;(b) “Banking Group” means ANZ National Bank Limited andall its controlled entities;(c) “Immediate Parent Company” means ANZ Holdings(New Zealand) Limited;(d) “Ultimate Parent Bank” means Australia and New Zealand
Banking Group Limited;(e) “Overseas Banking Group” means the worldwide
operations of Australia and New Zealand Banking Group
Limited including its controlled entities;(f ) “New Zealand business” means all business, operations,or undertakings conducted in or from New Zealandidentified and treated as if it were conducted by
a company formed and registered in New Zealand;(g) “NZ Branch” means the New Zealand business of the
Ultimate Parent Bank;(h) “ANZ New Zealand” means the New Zealand businessof the Overseas Banking Group;(i) “Registered Office” is Level 10, 170-186 Featherston
Street, Wellington, New Zealand, which is also the
Banking Group’s address for service;(j) “RBNZ” means the Reserve Bank of New Zealand;(k) “APRA” means the Australian Prudential Regulation
Authority;(l) “the Order” means the Registered Bank DisclosureStatements (New Zealand Incorporated Registered
Banks) Order 2012; and(m) Any term or expression which is defined in, or in themanner prescribed by, the Order shall have the meaning
given in or prescribed by the Order.

General Disclosures
Income Statement and Statementof Comprehensive Income
Statement of Changes in Equity
Balance Sheet
Condensed Cash Flow Statement
Notes to the Financial Statements
Directors’ Statement
Auditors’ Report

2
3
4
5
6
7
14
15

1

Disclosure Statement

ANZ National Bank Limited

General Disclosures

Changes to conditions of registration

This Disclosure Statement has been issued in accordancewith the Order.

The conditions of registration applying to the Bank havebeen amended with effect from 1 July 2012 to remove
condition 1C, that imposed minimum capital ratios on the
Bank at the solo “registered bank” level. This change has no
impact on capital adequacy requirements for the Banking
Group. The amendment also removed any conditions thatceased to apply on or before 30 June 2012, removed
commencement dates for conditions that came into effecton or before 1 July 2012, and made some minor wording
changes. None of these changes change the intention of
the conditions.

Credit Rating Information
The Bank has three credit ratings, which are applicable to its
long-term senior unsecured obligations which are payable in
New Zealand in New Zealand dollars.
The Bank’s Credit Ratings are:
Current
Credit Rating

Qualification

Standard & Poor’s

AA-

Outlook Stable

Moody’s Investors Service

Aa3

Outlook Stable

Fitch Ratings

AA-

Outlook Stable

Rating Agency

Guarantors
As at the date of signing of this Disclosure Statement the
Banking Group has debt securities with a carrying value asat 30 June 2012 of $341 million for which the Crown has
issued a Guarantee Eligibility Certificate under the
New Zealand Wholesale Funding Guarantee Facility(“Crown Wholesale Guarantee”). The Crown closed the
Crown Wholesale Guarantee to new debt securities
on 30 April 2010. The closure did not affect debt
securities previously issued with the benefit of Crown
Wholesale Guarantee.
Copies of the Wholesale Deed, and any Guarantee Eligibility
Certificate issued by the Crown in respect of the Bank,
are available on the Treasury website treasury.govt.nz.
The address for service for any demand on the Crown
under the Crown Wholesale Guarantee is The Treasurer,
New Zealand Debt Management Office, 1 The Terrace,
Wellington. Further information on the Crown Wholesale
Guarantee is provided in the Disclosure Statement for
the year ended 30 September 2011 which is available atno charge:(a) on the Bank’s websites anz.co.nz and nationalbank.co.nz;
and(b) within two working days of a request, if a request is
made at the Registered Office or at any branch of ANZ or
The National Bank of New Zealand.
Certain debt securities (“Covered Bonds”) issued by the
Bank or its wholly owned subsidiary, ANZ National (Int’l)Limited, are guaranteed by ANZNZ Covered Bond Trust
Limited (the “Covered Bond Guarantor”), solely in its
capacity as trustee of ANZNZ Covered Bond Trust. The
Covered Bond Guarantor has guaranteed the payment ofinterest and principal of Covered Bonds with a carrying
value as at 30 June 2012 of $1,845 million, pursuant to aguarantee which is secured over a pool of assets. The
Covered Bond Guarantor’s address for service is Level 10,
141 Willis Street, Wellington, New Zealand. The Covered
Bond Guarantor is not a member of the Banking Group andhas no credit ratings applicable to its long term seniorunsecured obligations payable in New Zealand dollars. The
Covered Bonds have been assigned a long term rating of
Aaa and AAA by Moody’s Investors Service and Fitch Ratings
respectively. Details of the pool of assets that secure thisguarantee are provided in Note 7.
Other material obligations of the Bank are not guaranteed.

Directorate
Mr P R Marriott resigned as a Director of the Bank on
31 May 2012.
Sir Dryden Spring retired as Director and Chairman of the
Bank on 22 June 2012. Mr J F Judge took over as Chairman
on 23 June 2012.
There have been no other changes to the Directors of the
Bank since 30 September 2011, the balance date of the lastfull year Disclosure Statement.

Auditors
The Banking Group’s auditors are KPMG, Chartered
Accountants, Level 9, 10 Customhouse Quay, Wellington,
New Zealand.

ANZ National Bank Limited

2–3

Income Statement
Unaudited
9 months to
30/06/2012

Unaudited
9 months to
30/06/2011

AuditedYear to30/09/2011

4,490

4,692

6,179

Interest expense

2,481

2,790

3,620

Net interest income

2,009

1,902

2,559

$ millions

Note

Interest income

Net trading gains

109

197

228

Net funds management and insurance income

222

202

265

440

193

361

1

1

2

Operating income

2,781

2,495

3,415

Operating expenses

1,268

1,303

1,686

1,513

1,192

1,729

142

121

178

1,371

1,071

1,551

Income tax expense

359

319

452

Profit for the period

1,012

752

1,099

Unaudited
9 months to
30/06/2012

Unaudited
9 months to
30/06/2011

AuditedYear to30/09/2011

1,012

752

1,099

Other operating income2

Share of associates’ profit

2

Profit before provision for credit impairment and income tax
Provision for credit impairment

6

Profit before income tax

Statement of Comprehensive Income$ millions

Profit for the period
Unrealised gains recognised directly in equity

50

23

72

Realised gains transferred to income statement

(8)

(35)

(38)

Actuarial gain / (loss) on defined benefit schemes

(2)

8

(64)

Income tax credit / (expense) on items recognised directly in equity

(3)

2

11

1,049

750

1,080

Total comprehensive income for the period

The notes to the financial statements form part of and should be read in conjunction with these financial statements

ANZ National Bank Limited

Statement of Changes in Equity$ millions

As at 1 October 2010

Ordinary
share
capitalAvailablefor-salerevaluation
reserve

Cash flow
hedging
reserve

Retainedearnings

Total equity
attributable toowners of theparent entity

Noncontrolling
entities

6,943

58

Total equity

102

3,342

10,445

1

10,446

Profit after income tax attributable to parent

-

-

-

752

752

-

752

Valuation gain recognised in othercomprehensive income

-

15

8

-

23

-

23

Losses / (gains) transferred to income statement

-

(42)

7

-

(35)

-

(35)

Actuarial gain on defined benefit schemes

-

-

-

8

8

-

8

Income tax credit / (expense) on items
recognised directly in equity

-

8

(4)

(2)

2

-

2

Total comprehensive income for the period

-

(19)

11

758

750

-

750

-

-

-

(430)

(430)

-

(430)

As at 30 June 2011 (Unaudited)

6,943

39

113

3,670

10,765

1

10,766As at 1 October 2010

Ordinary dividend paid

6,943

58

102

3,342

10,445

1

10,446

Profit after income tax attributable to parent

-

-

-

1,099

1,099

-

1,099

Valuation gain recognised in othercomprehensive income

-

21

51

-

72

-

72

Losses / (gains) transferred to income statement

-

(42)

4

-

(38)

-

(38)

Actuarial loss on defined benefit schemes

-

-

-

(64)

(64)

-

(64)

Income tax credit / (expense) on items
recognised directly in equity

-

9

(16)

18

11

-

11

Total comprehensive income for the period

-

(12)

39

1,053

1,080

-

1,080

Ordinary dividend paid

-

-

-

(700)

(700)

-

(700)

Movement in non-controlling interests
As at 30 September 2011 (Audited)

-

-

-

-

-

(1)

(1)

6,943

46

141

3,695

10,825-

10,825

Profit after income tax attributable to parent

-

-

-

1,012

1,012

-

1,012

Valuation gain recognised in othercomprehensive income

-

35

15

-

50

-

50

Gains transferred to income statement

-

-

(8)

-

(8)

-

(8)

Actuarial loss on defined benefit schemes

-

-

-

(2)

(2)

-

(2)

Income tax expense on items recognised
directly in equity

-

(1)

(2)

-

(3)

-

(3)

Total comprehensive income for the period

-

34

5

1,010

1,049

-

1,049

Ordinary dividend paid
As at 30 June 2012 (Unaudited)

-

-

-

(550)

(550)

-

(550)

6,943

80

146

4,155

11,324-

11,324

The notes to the financial statements form part of and should be read in conjunction with these financial statements

ANZ National Bank Limited

4–5

Balance Sheet
Unaudited
30/06/2012

Unaudited
30/06/2011

Liquid assets

2,693

2,205

2,455

Due from other financial institutions

1,234

2,356

3,685

Trading securities

12,234

9,652

9,466

Derivative financial instruments

11,796

10,43914,160$ millions

Note

Audited30/09/2011

AssetsCurrent tax assets

125

75

-

Available-for-sale assets

250

352

411

85,17885,02583,610Investments backing insurance policy liabilities

158

86

97

Insurance policy assets

260

191

200

-

62

-

Net loans and advances

4

Due from Immediate Parent Company
Investments in associates
Other assets

100

102

100

1,357

1,043

854

Deferred tax assets

71

173

139

Premises and equipment

322

324

325

3,504

3,518

3,510

Total assets

119,282

115,603

119,012Interest earning and discount bearing assets

100,933

98,79998,214

Goodwill and other intangible assets

Liabilities
Due to other financial institutions
Deposits and other borrowings

8

Due to Immediate Parent Company
Derivative financial instruments
Current tax liabilities
Payables and other liabilities
Provisions
Bonds and notes

3,443

2,214

2,236

72,866

68,46969,238

160

-

174

11,972

11,597

14,174

-

-

17

2,136

2,113

2,645

308

320

309

15,333

17,727

17,406

Loan capital

1,740

2,397

1,988

Total liabilities

107,958

104,837

108,187

Net assets

11,324

10,766

10,825

6,943

6,943

6,943

226

152

187

Represented by:
Share capital
Reserves
Retained earnings

4,155

3,670

3,695

Parent shareholder's equity

11,324

10,765

10,825-

1-

Total equity

11,324

10,766

10,825Interest and discount bearing liabilities

88,55786,59486,369Non-controlling interests

The notes to the financial statements form part of and should be read in conjunction with these financial statements

ANZ National Bank Limited

Condensed Cash Flow Statement$ millions

Unaudited
9 months to
30/06/2012

Unaudited
9 months to
30/06/2011

AuditedYear to30/09/2011

Cash flows from operating activities
Interest received

4,466

4,607

6,074

Interest paid

(2,436)(2,718)(3,573)

Other cash inflows provided by operating activities

625

595

913

Other cash outflows used in operating activities(1,696)(1,456)(1,892)

959

1,028

1,522

4

(1,844)

1,712

963

(816)

3,234

Cash flows from operating profits before changes in operating assets and liabilities
Net changes in operating assets and liabilities
Net cash flows provided by / (used in) operating activities
Cash flows from investing activities
Cash inflows provided by investing activities

16

48

69

Cash outflows used in investing activities

(64)

(74)

(119)

Net cash flows used in investing activities

(48)

(26)

(50)

Cash flows from financing activities
Cash inflows provided by financing activities

2,417

3,867

4,172

Cash outflows used in financing activities(5,829)(2,340)(4,793)

Net cash flows provided by / (used in) financing activities(3,412)

1,527

(621)

Net increase / (decrease) in cash and cash equivalents(2,497)

685

2,563

Cash and cash equivalents at beginning of the period

6,140

3,577

3,577

Cash and cash equivalents at end of the period

3,643

4,262

6,140

The notes to the financial statements form part of and should be read in conjunction with these financial statements

ANZ National Bank Limited

6–7

Notes to the Financial Statements
1. Significant Accounting Policies(i) Reporting entity and statement of compliance
These financial statements are for the Banking
Group for the nine months ended 30 June 2012.
They have been prepared in accordance withthe requirements of NZ IAS 34 Interim Financial
Reporting and the Order, and should be read in
conjunction with the Banking Group’s financial
statements for the year ended 30 September 2011.
(ii) Basis of measurement
These financial statements have been prepared on agoing concern basis in accordance with historicalcost concepts except that the following assets andliabilities are stated at their fair value:t EFSJWBUJWFGJOBODJBMJOTUSVNFOUT JODMVEJOHJOUIF
case of fair value hedging, the fair value of any
applicable underlying exposure;t GJOBODJBMJOTUSVNFOUTIFMEGPSUSBEJOH
t GJOBODJBMBTTFUTUSFBUFEBTBWBJMBCMFGPSTBMFBOEt GJOBODJBM JOTUSVNFOUT EFTJHOBUFE BU GBJS WBMVF
through profit and loss.
Insurance policy assets are measured using the
Margin on Services model, and defined benefit
obligations are measured using the Projected Unit
Credit method.
(iii) Changes in accounting policies
The accounting policies adopted by the Banking
Group are consistent with those adopted anddisclosed in the previous full year DisclosureStatement.
(iv) Presentation currency and rounding
The amounts contained in the financial statements
are presented in millions of New Zealand dollars,
unless otherwise stated.
(v) Comparatives
Certain amounts in the comparative information
have been reclassified to ensure consistency withthe current period’s presentation.
(vi) Principles of consolidation
The financial statements consolidate the financial
statements of the Bank and its controlled entities.

2. Other Operating Income and Expenses
Other operating income includes fair value gains of$80 million (30/06/2011 $158 million loss; 30/09/2011$102 million loss) on the revaluation of financial assets
and liabilities designated at fair value and on hedging
activities. Other operating income excluding these fair value
adjustments is $360 million (30/06/2011 $351 million;
30/09/2011 $463 million).
Operating expenses include costs for the nine months
ended 30 June 2012 of $97 million (30/06/2011 $147 million;
30/09/2011 $162 million) incurred in relation to the planned
move to a single banking technology platform, which is
expected to deliver operational efficiencies and improved
service levels and business outcomes.

ANZ National Bank Limited

Notes to the Financial Statements
large enterprises. The Banking Group’s relationship withthese businesses ranges from simple banking requirementswith revenue from deposit and transactional facilities, andcash flow lending, to more complex funding arrangementswith revenue sourced from a wider range of products. UDC
is principally involved in the financing and leasing of plant,
vehicles and equipment, mainly for small and medium sizedbusinesses, as well as investment products.

3. Segmental Analysis
For segment reporting purposes, the Banking Group isorganised into three major business segments – Retail,Commercial and Institutional. Centralised back office andcorporate functions support these segments. Thesesegments are consistent with internal reporting provided tothe chief operating decision maker, being the Bank’s Chief
Executive Officer.

Institutional
Institutional provides financial services to large multi-banked
corporations, often global, who require sophisticatedproduct and structuring solutions. The Institutional business
unit includes the following specialised units:t .BSLFUToQSPWJEFTGPSFJHOFYDIBOHF JOUFSFTUSBUFBOE
commodity trading and sales-related services, origination,
underwriting, structuring, risk management and sale ofcredit and derivative products globally;t 5SBOTBDUJPO#BOLJOHoQSPWJEFTDBTINBOBHFNFOU USBEF
finance and international payments;t 3FMBUJPOTIJQ.BOBHFNFOUoQSPWJEFTPSJHJOBUJPO DSFEJU
analysis and relationship coverage to every Institutionalcustomer;t (MPCBM-PBOToQSPWJEFTPSJHJOBUJPO DSFEJUBOBMZTJT 
structuring and execution of specific customertransactions.

Segmental reporting has been updated to reflect minorchanges to the Banking Group’s structure. Comparative
data has been adjusted to be consistent with the current
period’s segment definitions.
RetailRetail provides banking products and services to individuals
through separate ANZ and The National Bankof New Zealand branded distribution channels. Personalbanking customers have access to a wide range of financial
services and products. Retail contains the Banking Group’s
wealth businesses which include private banking andinvestment services provided to high net worth individuals,
the OnePath wealth management and insurance businesses,
and other investment products. This segment also includes
other profit centres supporting the Retail segment.
Commercial
Commercial provides services to Business Banking,Commercial & Agri, and UDC customers. Business Banking
services are offered to small enterprises (typically withannual revenues of less than $5 million). Commercial & Agricustomers consist of primarily privately owned medium to

Other
Other includes treasury and back office support functions,none of which constitutes a separately reportable segment.

Business segment analysis1$ millions

RetailCommercial

Institutional

Other2

Total

862

2,069

593

(743)

2,781

Unaudited 9 months to 30/06/2012
External revenues
Intersegment revenues
Total revenues
Profit before income tax

168

(973)

(112)

917

-

1,030

1,096

481

174

2,781

362

629

334

46

1,371

Unaudited 9 months to 30/06/2011
External revenues

933

2,190

442

(1,070)2,495Intersegment revenues

72(1,092)

39

981

-

1,005

1,098

481

(89)

2,495

326

623

365

(243)

1,071

1,222

2,895

613

(1,315)

3,415

Total revenues
Profit before income tax
Audited year to 30/09/2011
External revenues
Intersegment revenues
Total revenues
Profit before income tax
1
2

118

(1,424)

27

1,279

-

1,340

1,471

640

(36)

3,415

436

838

491

(214)

1,551

Intersegment transfers are accounted for and determined on an arm’s length or cost recovery basis.
This segment has negative external revenues as this segment incurs funding costs on behalf of the Banking Group and is reimbursed internally.

ANZ National Bank Limited

8–9

Notes to the Financial Statements
4. Net Loans and Advances$ millions

Note

Unaudited
30/06/2012

Unaudited
30/06/2011

Audited30/09/2011

Overdrafts

1,915

1,916

1,847

Credit card outstandings

1,408

1,392

1,367

Term loans – housing

44,82244,307

43,636

Term loans – non-housing

37,572

38,05437,398Finance lease receivables

803

755

768

Gross loans and advances

86,52086,42485,016(1,094)(1,198)(1,156)

(263)

(258)

(256)

Provision for credit impairment

6

Unearned finance income
Fair value hedge adjustment

(3)

72

22

Deferred fee revenue and expenses

(57)

(50)

(51)

75

35

35

85,17885,02583,610Capitalised brokerage / mortgage origination fees
Total net loans and advances

The Bank has sold residential mortgages to the NZ Branch with a net carrying value of $9,843 million as at 30 June 2012
(30/06/2011 $9,547 million, 30/09/2011 $9,931 million). These assets qualify for derecognition as the Bank does not retain acontinuing involvement in the transferred assets.

5. Impaired and Past Due Assets$ millions

Retailmortgages

Other retail
exposures

Non retail
exposures

Total

Unaudited 30/06/2012
Total individually impaired assets

315

45

1,067

1,427

Loans that are at least 90 days past due but not impaired

99

34

92

225

Total individually impaired assets

494

65

1,281

1,840

Loans that are at least 90 days past due but not impaired

161

39

131

331

Unaudited 30/06/2011

Audited 30/09/2011
Total individually impaired assets

451

61

1,194

1,706

Loans that are at least 90 days past due but not impaired

133

38

117

288

ANZ National Bank Limited

Notes to the Financial Statements
6. Provision for Credit Impairment$ millions

Retailmortgages

Other retail
exposures

Non retail
exposures

Total

110

125

385

620

Unaudited 30/06/2012
Collective provision
Individual provision

118

26

330

474

Total provision for credit impairment

228

151

715

1,094

Collective provision credit

(10)

(22)

(10)

(42)

Individual provision charge

25

49

110

184

Total charge in income statement

15

27

100

142

Collective provision

106

141

439

686

Individual provision

165

42

305

512

Total provision for credit impairment

Unaudited 30/06/2011

271

183

744

1,198

Collective provision credit

(5)

(8)

(94)

(107)

Individual provision charge

21

62

145

228

Total charge in income statement

16

54

51

121

120

147

395

662

Audited 30/09/2011
Collective provision
Individual provision

148

37

309

494

Total provision for credit impairment

268

184

704

1,156

Collective provision charge / (credit)

9

(2)

(138)

(131)

Individual provision charge

24

79

206

309

Total charge in income statement

33

77

68

178

7. Financial Assets Pledged as Collateral$ millions

Unaudited
30/06/2012

Unaudited
30/06/2011

Audited30/09/2011

Trading securities encumbered through repurchase agreements

2,126

844

1,219

Residential mortgages pledged as security for covered bonds

3,909

-

-

Total tangible assets of UDC Finance Limited pledged as collateral for secured stock

2,164

2,066

2,007

Total financial assets pledged as collateral

8,199

2,910

3,226

ANZNZ Covered Bond Trust
The assets of ANZNZ Covered Bond Trust (“the Trust”) are made up of certain housing loans and related securities originatedby the Bank which are security for the guarantee by ANZNZ Covered Bond Trust Limited as trustee of the Trust of issuances ofcovered bonds by the Bank, or its wholly owned subsidiary ANZ National (Int’l) Limited, from time to time. The assets of theTrust are not available to creditors of the Bank, although the Bank (or its liquidator or statutory manager) may have a claim
against the residual assets of the Trust (if any) after all prior ranking creditors of the Trust have been satisfied.
The Banking Group continues to recognise the assets of the Trust on its balance sheet as, although they are pledged as security
for covered bonds, the Bank retains substantially all the risks and rewards of ownership.

8. Deposits and Other Borrowings$ millions

Note

Unaudited
30/06/2012

Unaudited
30/06/2011

Audited30/09/2011

Certificates of deposit

3,014

2,304

2,454

Term deposits

32,51535,29733,799Demand deposits bearing interest

25,49021,541

22,230

Deposits not bearing interest

4,773

4,324

4,477

1,515

1,583

1,488

Commercial paper

5,559

3,420

4,790

Total deposits and other borrowings

72,866

68,46969,238

Secured debenture stock

7

ANZ National Bank Limited
10–11

Notes to the Financial Statements
9. Related Party Transactions
Unaudited
30/06/2012$ millions

Unaudited
30/06/2011

Audited30/09/2011

Total due from related parties

2,699

3,273

3,000

Total due to related parties

5,841

6,971

8,427

10. Capital Adequacy
Capital ratios of the Banking Group under the Basel II internal models based approach (Unaudited)

Tier One Capital

30/06/2012

30/06/2011

30/09/2011

11.51%

9.81%

10.02%

RBNZ minimum Tier One Capital ratio

4.00%

4.00%

4.00%

Total Capital

13.58%

13.04%

12.74%

RBNZ minimum Total Capital ratio

8.00%

8.00%

8.00%

Tier One Capital

11,324

Less deductions from Tier One Capital

3,661

Total Tier One Capital

7,663

Tier Two Capital

1,390

Exposureat default

Risk weighted
exposure or implied
risk weighted
exposure1

Total capitalrequirement

Corporate exposures

44,054

27,6282,210

Sovereign exposures

10,55586

7$mLess deductions from Tier Two Capital
Total Capital$ millions

9,042

Bank exposures

10,334

1,897

152

Retail mortgage exposures

48,787

12,457

997

9,017

5,875

470

Total exposures subject to internal ratings based approach

122,747

47,943

3,836

Specialised lending exposures subject to slotting approach

7,901

7,667

613

Exposures subject to standardised approach

278

265

21

Other retail exposures

Equity exposures

227

961

77

Other exposures

2,256

936

75

Total credit risk

133,40957,772

4,622

Operational risk

n/a

5,000

400

Market risk
Total capital requirement
1

11

n/a

3,815

305

133,409

66,587

5,327

Total credit risk weighted exposures include a scalar of 1.06 in accordance with the Bank’s Conditions of Registration.

ANZ National Bank Limited

Notes to the Financial Statements
Pillar II capital for other material risks
The Banking Group has an Internal Capital Adequacy Assessment Process (“ICAAP”) which complies with the requirements of
the Bank’s Conditions of Registration.
Under the Banking Group’s ICAAP it identifies and measures all “other material risks”, which are those material risks that are notexplicitly captured in the calculation of the Banking Group’s tier one and total capital ratios. The other material risks identified
by the Banking Group include business risk, pension risk, insurance risk, funds management risk, lapse risk, premises andequipment risk and capitalised origination fees risk.
The Banking Group’s internal capital allocation for these other material risks is $486 million (30/06/2011 $445 million; 30/09/2011$457 million).
The Banking Group regularly reviews the methodologies used to calculate the economic capital allocated to other material
risks. Updated capital methodologies (particularly relating to insurance and funds management risks) were applied in February
2012 and prior periods have been restated accordingly.
Residential mortgages by loan-to-valuation ratio (“LVR”)
As required by the RBNZ, LVRs are calculated as the current exposure secured by a residential mortgage divided by the Banking
Group’s valuation of the security property at origination of the exposure. Off balance sheet exposures include undrawn andpartially drawn residential mortgage loans as well as commitments to lend. Commitments to lend are formal offers for housing
lending which may or may not be accepted by the customer.
Unaudited 30/06/2012

On-balancesheet

Off-balance
sheet

Total

0% - 59%

16,731

3,313

20,04460% - 69%

7,126

983

8,109

70% - 79%

10,094

1,280

11,374

Less than 80%

33,951

5,576

39,52780% - 89%

5,448

1,036

6,484

Over 90%

3,373

354

3,727

Total

42,772

6,966

49,738$ millions

LVR range

11. Liquidity Portfolio
The Banking Group holds a diversified portfolio of cash and high quality liquid securities to support liquidity risk management.
The size of the Banking Group’s liquidity portfolio is based on the amount required to meet its liquidity policy and includes
both items classified as cash and cash equivalents and those classified as operating assets in the Condensed Cash
Flow Statement.
Liquidity Portfolio$ millions

Unaudited
30/06/2012

Balances with central banks

1,196

Securities purchased under agreement to resell

233

Certificates of deposit
Government, local body stock and bonds
Government treasury bills

120
6,540
40

Other bonds

3,918

Total liquidity portfolio

12,047

ANZ National Bank Limited
12–13

Notes to the Financial Statements
12. Concentrations of Credit Risk to Individual Counterparties
The Banking Group measures its concentration of credit risk in respect to bank counterparties on the basis of approved
exposures, and in respect to non bank counterparties on the basis of limits.
For the nine months ended 30 June 2012 there were no individual counterparties (excluding connected parties, governments
and banks with long term credit ratings of A- or above) where the Banking Group’s period end or peak end-of-day credit
exposure equalled or exceeded 10% of the Banking Group’s equity (as at the end of the period).

13. Insurance business
The Banking Group conducts insurance business through companies in the OnePath Insurance Holdings (NZ) Limited group.
The aggregate amount of insurance business in this group comprises assets totalling $549 million (30/06/2011: $390 million;
30/09/2011 $438 million), which is 0.5% (30/06/2011: 0.3%; 30/09/2011 0.4%) of the total consolidated assets of the
Banking Group.

14. Credit Related Commitments, Guarantees and Contingent Liabilities
Face or contract value$ millions

Unaudited
30/06/2012

Unaudited
30/06/2011

Audited30/09/2011

Credit related commitments
933

472

527

Commitments to provide financial services

24,001

21,842

22,526

Total credit related commitments

24,934

22,31423,053Financial guarantees

755

1,919

1,753

Standby letters of credit

49

51

60

Transaction related contingent items

1,016

921

882

Trade related contingent liabilities

98

80

110

1,918

2,971

2,805

Commitments with certain drawdown due within one year

Guarantees and contingent liabilities

Total guarantees and contingent liabilities

The Banking Group guarantees the performance of customers by issuing standby letters of credit and guarantees to third
parties, including its Ultimate Parent Bank. To reflect the risk associated with these transactions, they are subjected to the same
credit origination, portfolio management and collateral requirements as for customers that apply for loans. The contract
amount represents the maximum potential amount that could be lost if the counterparty fails to meet its financial obligations.
As the facilities may expire without being drawn upon, the notional amounts do not necessarily reflect future cash requirements.
Other contingent liabilities
The Banking Group has other contingent liabilities in respect of actual and possible claims and court proceedings. An
assessment of the Banking Group’s likely loss in respect of these matters has been made on a case-by-case basis and provision
made where deemed necessary.

15. Subsequent Events
On 23 July 2012 the Banking Group repaid a subordinated fixed rate bond of $350 million. The bond had an ultimate maturity
date of 23 July 2017, with the Bank able to elect to redeem the bond on 23 July 2012.
On 16 August 2012 the Bank’s Board resolved to repay a subordinated loan of $216 million on 17 September 2012. The loan had
an ultimate maturity date of 18 September 2017, with the Bank able to elect to repay the loan on 17 September each year from2012 to 2016.
On 16 August 2012 the Bank’s Board also resolved to pay an ordinary dividend of $600 million no later than 30 September 2012.

ANZ National Bank Limited

Directors’ Statement
As at the date on which this Disclosure Statement is signed, after due enquiry, each Director believes that:(i) The Disclosure Statement contains all the information that is required by the Registered Bank Disclosure Statements(New Zealand Incorporated Registered Banks) Order 2012; and(ii) The Disclosure Statement is not false or misleading.
Over the nine months ended 30 June 2012, after due enquiry, each Director believes that:(i) ANZ National Bank Limited has complied with all Conditions of Registration that applied during that period;(ii) Credit exposures to connected persons were not contrary to the interests of the Banking Group;(iii) ANZ National Bank Limited had systems in place to monitor and control adequately the Banking Group’s material risks,
including credit risk, concentration of credit risk, interest rate risk, currency risk, equity risk, liquidity risk, operational risk
and other business risks, and that those systems were being properly applied.
This Disclosure Statement is dated, and has been signed by or on behalf of all Directors of the Bank on, 16 August 2012.
On that date, the Directors of the Bank were:A J Carter

S C Elliott

N M T Geary, CBE

D D Hisco

J F Judge

M R P Smith, OBEANZ National Bank Limited
14–15

Independent Auditors’ Review Report
To the Shareholder of ANZ National Bank Limited
We have reviewed pages 3 to 13 of the interim financial statements of ANZ National Bank Limited (the ‘Bank’) and its subsidiarycompanies (the ‘Banking Group’) prepared and disclosed in accordance with the Registered Bank Disclosure Statements(New Zealand Incorporated Registered Banks) Order 2012 (the ‘Order’) and the supplementary information prescribed in
Schedules 3, 6, 8, 12, 13, 16 and 18 of the Order. The interim financial statements, and supplementary information, provide
information about the past financial performance and cash flows of the Banking Group and its financial position as at 30 June 2012.
Directors’ responsibilities
The Directors of ANZ National Bank Limited are responsible for the preparation and presentation of the Disclosure Statement,
which includes interim financial statements prepared in accordance with Clause 25 of the Order which give a true and fair view ofthe financial position of the Banking Group as at 30 June 2012 and its financial performance and cash flows for the nine months
ended on that date. The Directors are also responsible for such internal controls as the Directors determine are necessary toenable the preparation of the Disclosure Statement that is free from material misstatement whether due to fraud or error.
They are also responsible for the preparation of supplementary information in the Disclosure Statement which fairly states thematters to which it relates in accordance with Schedules 3, 6, 8, 12, 13, 16 and 18 of the Order.
Reviewers’ responsibilities
We are responsible for reviewing the interim financial statements and the supplementary information, disclosed in accordancewith Clause 25, Schedules 3, 6, 8, 12, 13, 16 and 18 of the Order and presented to us by the Directors.
We are responsible for reviewing the interim financial statements (excluding the supplementary information) in order to report
to you whether, in our opinion on the basis of the procedures described below, anything has come to our attention that would
cause us to believe that the interim financial statements have not been prepared, in all material respects, in accordance withNew Zealand Equivalent to International Accounting Standard 34 (“NZ IAS 34”): Interim Financial Reporting and do not present
a true and fair view of the financial position of the Banking Group as at 30 June 2012 and its financial performance and cash
flows for the nine months ended on that date.
We are responsible for reviewing the supplementary information (excluding the supplementary information relating to capital
adequacy) in order to report to you whether, in our opinion on the basis of the procedures described below, anything hascome to our attention that would cause us to believe that the supplementary information does not fairly state the matters towhich it relates in accordance with Schedules 6, 8, 13, 16 and 18 of the Order.
We are responsible for reviewing the supplementary information relating to capital adequacy in order to state whether, on thebasis of the procedures described below, anything has come to our attention that cause us to believe that the information
disclosed in accordance with Schedule 12 is not in all material respects prepared in accordance with the Bank’s Conditionsof Registration and with the Bank’s internal models for credit risk and operational risk as accredited by the Reserve Bank of
New Zealand and disclosed in accordance with Schedule 12 of the Order.
We have performed our review in accordance with the review engagement standard RS-1 Statement of Review Engagement
Standards issued by the External Reporting Board. A review is limited primarily to enquiries of Banking Group personnel andanalytical review procedures applied to the financial data, and thus provides less assurance than an audit. We have not
performed an audit and, accordingly, we do not express an audit opinion.
KPMG has also provided other audit related services to the Banking Group. In addition, certain partners and employees of ourfirm may also deal with the Banking Group on normal terms within the ordinary course of trading activities of the business of
the Banking Group. These matters have not impaired our independence as auditors of the Banking Group. We have no otherrelationship with, or interest in, the Banking Group.
Review Opinion
We have examined the interim financial statements including the supplementary information and based on our review, which
is not an audit, nothing has come to our attention that causes us to believe that:a.

the interim financial statements (excluding the supplementary information) have not been prepared, in all material respects,
in accordance with NZ IAS 34: Interim Financial Reporting and do not present a true and fair view of the financial positionof the Banking Group as at 30 June 2012 and its financial performance and cash flows for the nine months ended on thatdate;b. the supplementary information prescribed by Schedules 6, 8, 13, 16 and 18 of the Order does not fairly state the matters towhich it relates in accordance with those Schedules; andc. the supplementary information relating to Capital Adequacy as required by Schedule 12 of the Order, is not in all material
respects prepared in accordance with the Bank’s Conditions of Registration, with the Reserve Bank of New Zealanddocument Capital Adequacy Framework (Internal Models Based Approach) (BS2B), and with the Banking Group’s internal
models for credit risk and operational risk as accredited by the Reserve Bank of New Zealand, and disclosed in accordancewith Schedule 12 of the Order.
Our review was completed on 16 August 2012 and our review opinion is expressed as at that date.

Wellington

ANZ National Bank Limited 07/12
13386

anz.co.nz