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MEDIA RELEASEFor Release Monday 31 August 2009

General Disclosure Statements for nine months to 30 June 09
New Zealand business is strong and sound, but reduced profit reflects
challenging economic environment
Wellington: ANZ National Bank today released the General Disclosure Statements for theNew Zealand business for the nine months to 30 June 2009. Net profit after tax of NZ$478
million declined 43 per cent compared with the same period in 2008 ($833m).
“This result reflects the tough recessionary times in which we are operating,” ANZ National
Chief Executive Officer Jenny Fagg said.
“The General Disclosure Statements reflect the strength and soundness of ANZ National, andthe significant contribution we are making to the New Zealand economy in this challengingenvironment.”
ANZ National is one of New Zealand’s largest companies with about 9,000 staff, and $126
billion in assets. As such, it accounts for around 1 per cent of New Zealand’s GDP.
“Increased provision for credit impairment is one of the key drivers of our financial
performance in this period, reflecting the environment as households and businesses cometo terms with the effect of the global downturn.”
Provisions for the nine months to June 09 are $532m, up from $167m in the previous
comparable period. Provisions for the full year to September 09 are expected to beapproaching three times those of the 2008 year.
Also impacting the result was an after tax provision charge of $147m (increased from$116m at 31 March 2009) to meet the obligations to investors in the ING Diversified Yield
and ING Regular Income Funds. This follows the offer accepted by investors by which they
will get the bulk of their money over five years.
Operating expenses were well controlled across all businesses.
Underlying profit before provisions was up 14 per cent from the same period last year,
largely due to a significant (69 per cent) profit increase in the Institutional businesses. Thisis driven by exceptional Markets trading results in the first half in highly volatile marketconditions. This result is not expected to be repeated in the remainder of the financial year.
“The declining net interest margin is the other major factor on our business performance,
reflecting higher wholesale funding costs, competition for deposits and adverse prepayments driven by interest rate falls,” Ms Fagg said.
“The underlying net interest margin for our core Retail, Commercial and Rural businesses
have decreased by 26 basis points since the same period in 2008, a continuation of thedownward trend over the last three quarters.
“The overall results demonstrate that our business, like other businesses in New Zealand,
continues to be directly affected by the economic downturn.

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“Despite the higher funding costs we are facing, thanks to ANZ National’s strong
foundations, we have been able to continue lending and supporting the New Zealandeconomy. Earlier in the year we made a commitment to provide $4 billion in new lending tofarms and businesses and we are well on track to meet or exceed that target.
“We are also maintaining good liquidity levels and remain well capitalised.
“Strong backing by our parent has facilitated direct funding of New Zealand assets. Following
the establishment of the ANZ Banking Group Limited New Zealand Branch, we have to datebeen able to secure an additional $10 billion of funding through the sale of mortgage assets
to our parent.
“The global financial crisis has seen many overseas financial institutions requiring taxpayer
bailouts. In New Zealand this hasn’t been necessary and it’s highlighted the importance of astrong and stable banking industry to New Zealand’s economy and to our customers. ANZGroup is one of 11 banks globally with a credit rating of ‘AA’ from Standard & Poor’s,” Ms
Fagg concluded.
The Reconciliation of Underlying Core Profit table is attached.
Background note to journalists•The figures used have been taken from the Australia and New Zealand BankingGroup Limited NZ Branch General Disclosure Statement for 9 months to 30 June 2009[“NZ Branch GDS”].

•As such the NZ Branch GDS provides a more complete picture of ANZ’s operations inNZ and more consistency with ANZ Group reporting where the results of the New
Zealand business are reported at a total New Zealand geographic level.

•The NZ Branch GDS mainly comprises the financial results of ANZ National, but alsoincludes its NZ parent company ANZ Holdings and the NZ Branch of ANZ BankingGroup Ltd.

•The ANZ National General Disclosure Statement for the 9 months to 30 June 2009has also been published today and includes the financial results of ANZ National Bank
Ltd and all its subsidiaries.

•ANZ National is a subsidiary of Australia and New Zealand Banking Group Limited(ANZ).

•The underlying Net Interest Margin (NIM) refers to the NIM for our core banking
business (Retail, Commercial and Rural).

•The General Disclosure Statements are available on www.anznational.co.nz

For media inquiries contact:
Virginia Stracey-Clitherow
Tel: 09 262 3244 or 0275-618 995.

Astrid Smeele
Tel: 04 4366754 or 027 4907 336

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MEDIA RELEASE
Reconciliation of underlying core profit

9 months to 30 June 2009

Adjusted net interest income
Other external operating income
19 months to30 June 09($m)

9 months to30 June 08($m)

1,620
886

1,570
723

23%
9%

Change3%

Net operating income

2,506

2,293

Operating expenses

1,064

1,032

3%

Underlying profit before provisioning
Comprising:
RetailCommercial
WealthInstitutional
Other

1,442

1,261

14%

518
404
12488
20580
393
29289
(30)

-11%

Underlying profit before provisioning
Provision for credit impairment

1,442532

1,261
167

large

Profit before income tax

910

1,094

- 17%

Income tax expense

270349- 23%

Underlying net profit after tax

640745

- 14%

(19)
(147)
(2)
000(2)
93n/a7(1)

(2)
(1)

Large

478

833

-43%

1.97%

2.05%

-0.08%

2.19%

2.45%

-0.26%

Non core items:
Organisational transformation costs
ANZ share of ING NZ investor settlement
Non-continuing businesses
Significant items
Economic hedging - fair value
gains/losses
Other
Headline net profit after tax
Headline net interest margin1
Underlying NZ businesses net interest
margin2

3%
-59%
69%
167%
14%

n/a0%
-100%

0%

1Net Interest Income and other external operating income have been adjusted for higher
funding benefits associated with unrealised trading losses (reclassification from net interest
income to other external operating income).
2

Underlying net interest margin refers to the net interest margin for our core Retail,Commercial and Rural businesses.

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