Australia and New Zealand Banking Group Limited
ABN 11 005 357 522

Half Year
31 March 2024

Consolidated Financial Report

CONDENSED CONSOLIDATED FINANCIAL STATEMENTSCONTENTS

Page

Directors’ Report3

Condensed Consolidated Income Statement

7

Condensed Consolidated Statement of Comprehensive Income

8

Condensed Consolidated Balance Sheet

9

Condensed Consolidated Cash Flow Statement

10

Condensed Consolidated Statement of Changes in Equity

11

Notes to Condensed Consolidated Financial Statements

12

Directors’ Declaration

46

Auditor’s Review Report and Independence Declaration

47

This Consolidated Financial Report has been prepared for Australia and New Zealand Banking Group Limited (ANZBGL, Company, us, we, or our) andits subsidiaries (Group).
All amounts are in Australian dollars unless otherwise stated. The 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 this Consolidated Financial Report contains general background information about the 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.
This Consolidated Financial Report may contain forward-looking statements or opinions including statements regarding our intent, belief or current
expectations with respect to the Group’s business operations, market conditions, results of operations and financial condition, capital adequacy, specificprovisions and risk management practices. When used in the Consolidated Financial Report, the words ‘forecast’, ‘estimate’, ‘project’, ‘intend’,‘anticipate’, ‘believe’, ‘expect’, ‘may’, ‘probability’, ‘risk’, ‘will’, ‘seek’, ‘would’, ‘could’, ‘should’ and similar expressions, as they relate to the Group and its
management, are intended to identify forward-looking statements or opinions. Those statements are usually predictive in character; or may be affected byinaccurate 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 totheir correctness 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. The 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.

2

DIRECTORS’ REPORTThe Directors present their report for Australia and New Zealand Banking Group 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 JP Cincotta

Director, appointed 15 February 2024

Mr RBM Gibb

Director, appointed 15 February 2024

Ms SJ Halton, AO PSM

Director

Mr GK Hodges

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

Performance overview
Condensed Consolidated Income Statement
Half Year

Movement

Net interest income

Mar 24$M
7,900

Sep 23$M
8,071

Mar 23$M
8,497

Mar 24v. Sep 23-2%

Mar 24v. Mar 23-7%

Other operating income

2,248

2,248

1,662

0%

35%

Operating income

10,148

10,31910,159-2%0%Operating expenses(5,179)(5,101)(4,986)

2%

4%

Profit before credit impairment and income tax

4,969

5,218

5,173

-5%

-4%

(70)

(112)

(133)

-38%

-47%

Credit impairment (charge)/release
Profit before income tax

4,899

5,106

5,040

-4%

-3%

Income tax expense(1,435)(1,495)(1,450)-4%-1%Profit for the period

3,464

3,611

3,590

-4%

-4%

March 2024 v March 2023•

Net interest income decreased $597 million (7%) driven by a 20 bps decrease in net interest margin, partially offset by a $43.0 billion increase inaverage interest earning assets. The net interest margin decreased from 175 bps to 155 bps driven by pricing competition in the Australia Retail,
Australia Commercial and New Zealand divisions, a decrease in Markets net interest income driven by higher funding costs, primarily on commodity
assets, where the related revenues are recognised as Other operating income, unfavourable asset and funding mix, and higher wholesale funding
rates. This was partially offset by higher earnings on capital and replicating deposits, and favourable deposit margins. The increase in averageinterest earning assets was driven by higher average trading assets and investment securities, and net loans and advances.

•

Other operating income increased $586 million (35%) driven by higher net foreign exchange earnings and other financial instruments income($522 million), loss on reclassification of data centres in Australia to held for sale in March 2023 half ($43 million), higher fee and commission income($26 million), and recycling of foreign currency translation reserves (FCTR) from other comprehensive income to profit or loss on dissolution ofseveral international entities ($20 million). This was partially offset by a loss on partial disposal of investment in AMMB Holdings Berhad (AmBank)($21 million).

•

Operating expenses increased $193 million (4%) driven by higher personnel expenses ($156 million), higher restructuring expenses ($87 million),and higher technology expenses ($55 million), partially offset by lower other expenses ($100 million) benefitting from productivity initiatives.

•

Credit impairment charge decreased $63 million (47%) driven by a decrease in the collectively assessed credit impairment charge, partially offset
by an increase in the individually assessed credit impairment charge due to lower write-backs.

March 2024 v September 2023•

Net interest income decreased $171 million (2%) driven by a 10 bps decrease in net interest margin, partially offset by a $38.4 billion increase inaverage interest earning assets. The net interest margin decreased from 165 bps to 155 bps driven by a decrease in Markets net interest income
driven by higher funding costs, primarily on commodity assets where the related revenues are recognised as Other operating income, pricing
competition in the Australia Retail and Australia Commercial divisions, and higher wholesale funding rates. This was partially offset by higher
earnings on capital and replicating deposits. The increase in average interest earning assets was driven by higher average trading assets andinvestment securities, and net loans and advances.

•

Other operating income remained flat as higher net foreign exchange earnings and other financial instruments income ($167 million) was offset bylower net fee and commission income ($46 million), a decrease in share of associates’ profit ($29 million), an adjustment to the gain on sale relating

3

DIRECTORS’ REPORTto the completed UDC Finance divestment in the September 2023 half ($23 million), lower gain from recycling of FCTR from other comprehensive
income to profit or loss on dissolution of a number of international entities ($23 million), and a loss on partial disposal of investment in AmBank($21 million).
•

Operating expenses increased $78 million (2%) driven by higher personnel expenses ($192 million), higher technology expenses ($31 million) andhigher restructuring expenses ($26 million), partially offset by lower other expenses ($168 million) benefitting from productivity initiatives and theCompensation Scheme of Last Resort levy incurred in the September 2023 half.

•

Credit impairment charge decreased $42 million (38%) driven by a decrease in the individually assessed credit impairment charge due to higher
write-backs and lower impairment, and a decrease in the collectively assessed credit impairment charge.

Condensed Consolidated 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

160.0

134.0

Derivative financial instruments

47.5

60.4

Net loans and advances

715.8

707.7

Other
Total assets

Mar 24v. Sep 23-20%

Mar 24v. Mar 23
-33%

133.1

19%

20%

45.6

-21%

4%

690.7

1%

4%

17.1

17.9

17.1

-4%

0%

1,090.1

1,106.1

1,111.6-1%-2%

Liabilities
Settlement balances owed by ANZ / Collateral received

22.4

29.7

31.0

-25%

-28%

Deposits and other borrowings

807.2

815.2

843.1

-1%

-4%

Derivative financial instruments

42.7

57.5

46.2

-26%

-8%

Debt issuances

127.1

116.0

106.2

10%

20%

20.5

18.6

16.5

10%

24%

Total liabilities

1,019.9

1,037.0

1,043.0-2%-2%

Total equity

70.2

69.1

68.6

2%

2%

Other

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,
overnight interbank deposits and settlement balances owed to ANZ.

•

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 home loan growth and higher business lending, partially offset by impact of foreign
currency translation movements.

•

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

•

Deposits and other borrowings decreased $35.9 billion (4%) driven by decreases in deposits from banks and repurchase agreements, customer
deposits, and certificates of deposit. This was partially offset by an increase in commercial paper and other borrowings and impact of foreign
currency translation movements.

•

Debt issuances increased $20.9 billion (20%) driven by 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,
settlement balances owed to ANZ, overnight interbank deposits, reverse repurchase agreements, and the impact of foreign currency translation.

•

Trading assets and investment securities increased $26.0 billion (19%) driven by an increase 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 $8.1 billion (1%) driven by home loan growth, partially offset by lower business lending and the impact of foreign
currency translation movements.

•

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

•

Deposits and other borrowings decreased $8.0 billion (1%) driven by decreases in deposits from banks and repurchase agreements, customer
deposits, certificates of deposit, and the impact of foreign currency translation movements. This was partially offset by increases in commercial paperand other borrowings.

•

Debt issuances increased $11.1 billion (10%) 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.

4

DIRECTORS’ REPORT
Movement

Half Year Average

Liquidity

Total liquid assets ($B)

Mar 24281.7

Sep 23270.8

Mar 23265.9

Mar 24v. Sep 23
4%

Mar 24v. Mar 23
6%

Liquidity Coverage Ratio (%)

134%

132%

128%

2%

6%

The Group holds a portfolio of high quality unencumbered liquid assets in order to protect the 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 Liquidity Coverage Ratio (LCR):•

Highest-quality liquid assets (HQLA1): cash, highest credit quality government, central bank or public sector securities eligible for repurchase withcentral 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 andhigh quality covered bonds eligible for repurchase with central banks to provide same-day liquidity.

•

Alternative liquid assets (ALA): Eligible securities listed by the Reserve Bank of New Zealand (RBNZ).

The Group monitors and manages the size and composition of its liquid assets portfolio on an ongoing basis in line with regulatory requirements and therisk appetite set by the Board. The LCR remained above the regulatory minimum thresholds throughout this period.

Funding

As at

Movement

Total customer liabilities (funding)

Mar 24$B
652.1

Sep 23$B
659.1

Mar 23$B
661.3

Wholesale funding

319.7

316.8

Shareholders' equity

70.2

69.1

1,042.0
118%

Total funding
Net Stable Funding Ratio (%)

Mar 24v. Sep 23-1%

Mar 24v. Mar 23
-1%

335.6

1%

-5%

68.6

2%

2%

1,045.0

1,065.5

0%

-2%

116%

119%

2%

-1%

The Group targets a diversified funding base, avoiding undue concentration by investor type, maturity, market source and currency.
During the March 2024 half, the ANZ Bank 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.
Net Stable Funding Ratio remained above the regulatory minimum of 100% throughout this period.
1.

Excludes unsubordinated debt with shorter tenors (such as 12 to 18 months).

Capital Management (Level 2)

As at

Movement

Mar 24

Sep 23

Mar 23

Mar 24v. Sep 23

Mar 24v. Mar 23

Common Equity Tier 1- APRA

13.5%

13.3%

13.2%

- International Comparable

19.7%

19.7%

19.4%

Credit risk weighted assets ($B)

348.4

349.0

345.3

0%

1%

Total risk weighted assets ($B)

432.8

433.3

435.5

0%

-1%

APRA Leverage Ratio

5.4%

5.4%

5.3%

APRA, under the authority of the Banking Act 1959, sets minimum regulatory requirements for banks including what is acceptable as regulatory capitaland provides methods of measuring the risks incurred by the Bank.
The Group’s APRA Common Equity Tier 1 ratio was 13.5% at 31 March 2024, exceeding APRA’s minimum requirements. The increase of 16 bps during
the March 2024 half was driven by current period earnings, proceeds from partial disposal of investment in AmBank, partially offset by the impact ofdividends paid during the period, higher underlying risk weighted assets usage, and capital deduction and other impacts.
At 31 March 2024, the Group’s APRA Leverage Ratio was 5.4% which is above the 3.5% proposed minimum for Internal Ratings Based Authorised
Deposit-taking Institution, which includes ANZ.

Dividend
ANZBGL paid a 2023 final dividend of $2,771 million to its intermediate holding company, ANZ BH Pty Ltd, a wholly owned subsidiary of ANZGHL, during
the March 2024 half.
On 6 May 2024, the Directors proposed a 2024 interim dividend of $2,496 million be paid on 1 July 2024, to ANZ BH Pty Ltd.

5

DIRECTORS’ 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 48 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

6

CONDENSED CONSOLIDATED INCOME STATEMENT

Australia and New Zealand Banking Group Limited
Half Year
Note
Interest income
Interest expense

Movement

Mar 24$M
29,832

Sep 23$M
27,089Mar 23$M
22,840Mar 24v. Sep 23
10%

Mar 24v. Mar 23
31%
53%(21,932)(19,018)(14,343)

15%

Net interest income

2

7,900

8,071

8,497

-2%

-7%

Other operating income

2

2,104

2,070

1,507

2%

40%

2

48

53

55

-9%

-13%

2, 15

96

125

100

-23%

-4%

10,148

10,31910,159-2%

0%(5,179)(5,101)(4,986)

2%

4%

4,969

5,218

5,173

-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

8

Profit before income tax
Income tax expense

4

Profit for the period

(70)

(112)

(133)

-38%

-47%

4,899

5,106

5,040

-4%

-3%

(1,435)(1,495)(1,450)

-4%

-1%

3,464

3,611

3,590

-4%

-4%

3,450

3,597

3,576

-4%

-4%

14

14

14

0%

0%

Comprising:
Profit attributable to shareholders of the Company
Profit attributable to non-controlling interests

13

The notes appearing on pages 12 to 45 form an integral part of the Condensed Consolidated Financial Statements.

7

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

Australia and New Zealand Banking Group Limited
Half Year
Mar 24$M
3,464

Profit for the period

Sep 23$M
3,611

Movement
Mar 23$M
3,590

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

20

(80)

50

large

-60%

Other reserve movements1

(59)

(48)

(32)

23%

84%

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

(273)

279

(301)

large

-9%

Share of associates' other comprehensive income2

(17)

23

8

large

large

3,704

2,837

5,180

31%

-28%

3,701

2,826

5,136

31%

-28%

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 12 to 45 form an integral part of the Condensed Consolidated Financial Statements.

8

CONDENSED CONSOLIDATED BALANCE SHEET

Australia and New Zealand Banking Group Limited
As at
AssetsCash and cash equivalents1

Note

Movement

Mar 24$M
137,696

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

7

117,618

96,96993,50521%

26%715,821707,694

690,737

1%

4%

Regulatory deposits
Investments in associates

696

646

646

8%

8%

1,405

2,321

2,214

-39%

-37%
-8%

Current tax assets

45

37

49

22%

Deferred tax assets

3,199

3,398

3,026

-6%

6%

Goodwill and other intangible assets

3,907

3,961

3,933

-1%

-1%

Premises and equipment

2,293

2,360

2,613

-3%

-12%

Other assets

5,485

5,207

4,629

5%

18%

Total assets

1,090,138

1,106,064

1,111,642

-1%

-2%

15,026

19,26723,010-22%-35%

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

9

7,409

10,382

8,002

-29%

-7%

807,189815,203

843,098-1%-4%

Derivative financial instruments

42,72857,482

46,154-26%-7%

Current tax liabilities

195

305

342

-36%

-43%

Deferred tax liabilities

59

60

58

-2%

2%

17,982

15,984

13,941

13%

29%

579

568

592

2%

-2%

1,660

1,714

1,692

-3%

-2%

Payables and other liabilities
Employee entitlements
Other provisions
Debt issuances10

Total liabilities

127,109

116,014106,15710%20%

1,019,936

1,036,979

1,043,046

-2%

-2%

70,202

69,08568,5962%

2%

Net assets
Shareholders' equity
Ordinary share capital

13

29,03329,082

29,0540%0%

Reserves

13(1,510)(1,796)(1,065)-16%

42%

Retained earnings

13

41,911

41,27740,0822%

5%69,43468,56368,071

1%

2%

768

522

525

47%

46%

70,202

69,08568,5962%

2%

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

13

Total shareholders' equity
1.

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

The notes appearing on pages 12 to 45 form an integral part of the Condensed Consolidated Financial Statements.

9CONDENSED CONSOLIDATED CASH FLOW STATEMENT

Australia and New Zealand Banking Group Limited
Half Year
Mar 24$M
3,464

Sep 23$M
3,611

Mar 23$M
3,590

Allowance for expected credit losses

70

112

133

Depreciation and amortisation

456

463

478

-

-

43

858

(1,912)

5,417

Profit after income tax
Adjustments to reconcile to net cash flow provided by/(used in) operating activities:

Loss on reclassification of data centres to held for saleNet derivatives/foreign exchange adjustment(Gain)/loss on sale from divestments

21

(29)

-

Other non-cash movements1

(22)

(86)

(12)

262

958

3,185

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

(20)

384

(6,272)(10,665)(16,300)(11,989)

(591)

(499)

(1,226)

Deposits and other borrowings(4,532)(19,833)

41,699Settlement balances owed by ANZ(4,178)(3,775)

9,053

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

2,196

1,926

2,924

Total adjustments(19,042)(36,547)

35,541

Net cash (used in)/provided by operating activities3(15,578)(32,936)

39,131

Purchases(43,900)(38,480)(13,494)

Proceeds from sale or maturity

5,432

Trading assets

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

Cash flows from investing activities
Investment securities assets:
22,99635,969Proceeds from divestments, net of cash disposed

668

558

577

Net investments in other assets

(451)

(254)

(350)

(20,687)(2,207)(7,835)(27)(12,042)937

Issue proceeds

26,24019,141

25,041

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

Dividends paid5.6(2,299)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)Other equity distribution7

(126)

(2)

(19)

Repayment of lease liabilities

(164)

(181)

(156)

ANZ Bank New Zealand Perpetual Preference Shares

252

-

-

Net cash (used in)/provided by financing activities

6,752(4,781)

8,815

Net increase/(decrease) in cash and cash equivalents(29,513)(39,924)

40,111

Cash and cash equivalents at beginning of period

168,154

208,800

168,132

(945)

(722)

557

137,696

168,154

208,800

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

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 to better reflect the movement in operating assets and operating liabilities. Comparatives have been 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 $29,361 million (Sep 23 half: $26,266 million Mar 23 half: $22,079 million), interest paid of $21,287 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 in the March 2023 half are classified in dividends paid.
6. March 2023 half Includes $320 million cash outflow as part of the special dividend to the Group’s parent entity, ANZ BH Pty Ltd.
7. Represents funding of on market purchases of ANZGHL ordinary shares for employee share and option plans.
The notes appearing on pages 12 to 45 form an integral part of the Condensed Consolidated Financial Statements.

10CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

Australia and New Zealand Banking Group Limited

Ordinary
share
capital$M
As at 1 October 2022

Retained
Reserves earnings$M$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

-

-

3,576

3,576

14

3,590

Other comprehensive income for the period

-

1,600

(40)

1,560

30

1,590

Total comprehensive income for the period

-

1,600

3,536

5,136

44

5,180

Transactions with equity holders in their capacity as equity holders:
Dividends paid--

(3,172)(3,172)(13)(3,185)

206

-

-

206

-

206

53

-

-

53

-

53

Net transfers following Restructure

-

(39)

39

-

Other items

(2)

(20)

-

(22)

-

(22)

Dividend reinvestment plan1
Other equity movements:
Employee share and option plans

As at 31 March 2023-

29,054(1,065)40,082

68,071

525

68,596

Profit/(Loss) for the period

-

-

3,597

3,597

14

3,611

Other comprehensive income for the period

-

(737)

(34)

(771)

(3)

(774)

Total comprehensive income for the period

-

(737)

3,563

2,826

11

2,837

-

-

(2,387)(2,387)(14)(2,401)

26

-

-

26

-

26

Transactions with equity holders in their capacity as equity holders:
Dividends paid
Other equity movements:
Employee share and option plans
Other items
As at 30 September 2023

2

6

19

27

-

27

29,082(1,796)

41,277

68,563522

69,085
3,464

Profit/(Loss) for the period

-

-

3,450

3,450

14

Other comprehensive income for the period

-

299

(48)

251

(11)

240

Total comprehensive income for the period

-

299

3,402

3,701

3

3,704

-

-

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

(49)

-

-

(49)

-

(49)

-

-

(4)

(4)

256

252

Transactions with equity holders in their capacity as equity holders:
Dividends paid
Other equity movements:
Employee share and option plans
ANZ Bank New Zealand Perpetual Preference Shares2
Other items
As at 31 March 2024
1.
2.

-

(13)

7

(6)

-

(6)

29,033(1,510)41,911

69,434768

70,202

8.4 million shares were issued under the dividend reinvestment plan for the 2022 final dividend.
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 13 Shareholders’ equity
for further details.

The notes appearing on pages 12 to 45 form an integral part of the Condensed Consolidated Financial Statements.

11

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 ANZBGL’s Annual Financial Report for the year ended 30 September 2023 and any public announcements madeby ANZBGL 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 ANZBGL 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 ANZBGL 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.
These adjustments were primarily driven by the impact of changes in the pattern of recognition of revenue on insurance contracts issued, changes in thepattern of recognition of the net cost of reinsurance and the valuation of profit commissions on reinsurance contracts held.

12

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 ANZBGL 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 8 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.

13

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.

14

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

15

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.

16

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
2.

IncomeHalf Year

Movement

Interest income

Mar 24$M
29,832

Sep 23$M
27,089Mar 23$M
22,840Mar 24v. Sep 23
10%

Mar 24v. Mar 23
31%

Interest expense(21,740)(18,840)(14,168)

15%

53%

Major bank levy

(192)

(178)

(175)

8%

10%

Net interest income

7,900

8,071

8,497

-2%

-7%

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

207

198

199

5%

4%

1,137

1,156

1,119

-2%

2%

Commissions

37

45

40

-18%

-8%

Funds management income

125

124

122

1%

2%

Fee and commission income

1,506

1,523

1,480

-1%

2%

Fee and commission expense

(543)

(514)

(543)

6%

0%

Net fee and commission income

963

1,009

937

-5%

3%

1,112

945

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

30

73

23

-59%

30%

Other income

1,141

1,061

570

8%

large

Other operating income

2,104

2,070

1,507

2%

40%

48

53

55

-9%

-13%

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

96

125

100

-23%

-4%

10,148

10,31910,159-2%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.

17

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
2,728

2,555

2,602

7%

5%

Superannuation costs

Salaries and related costs

217

202

194

7%

12%

Other

97

93

90

4%

8%

3,042

2,850

2,886

7%

5%

Personnelii) Premises
Rent

37

37

34

0%

9%

Depreciation

217

218

219

0%

-1%

Other

84

86

90

-2%

-7%

Premises

338

341

343

-1%

-1%

Depreciation and amortisation

234

245

256

-4%

-9%

Subscription licences and outsourced services

549

523

484

5%

13%

Other

103

87

91

18%

13%

Technology

886

855

831

4%

7%

iv) Restructuring

141

115

54

23%

large

iii) Technologyv) OtherAdvertising and public relations

87

86

90

1%

-3%

Professional fees

334

451

406

-26%

-18%

Freight, stationery, postage and communication

78

89

86

-12%

-9%

Other

273

314

290

-13%

-6%

Other
Operating expenses

18

772

940

872

-18%

-11%

5,179

5,101

4,986

2%

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
4,899

Sep 23$M
5,106

Mar 23$M
5,040

Mar 24v. Sep 23-4%

Mar 24v. Mar 23-3%

Prima facie income tax expense at 30%

1,470

1,532

1,512

-4%

-3%

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

(29)

(37)

(31)

-22%

-6%

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

(14)

(10)

8

40%

Subtotal

1,426

1,493

1,451

-4%

-2%

9

2

(1)

large

large

1,435

1,495

1,450

-4%

-1%

753

787

851

-4%

-12%

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

682

708

599

-4%

14%

Income tax expense

Overseas

1,435

1,495

1,450

-4%

-1%

Effective tax rate

29.3%

29.3%

28.8%

19

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
5.

Dividends
Half Year

Ordinary share dividend ($M)1
Interim dividend

Mar 24

Sep 23

Movement
Mar 23

-

2,387

-

2,771

-

2,213

Bonus option plan adjustment

-

-

(41)

Special dividend to ANZ BH Pty Ltd

-

-

1,000

2,771

2,387

3,172

Final dividend

Total
1.

Mar 24v. Sep 23

Mar 24v. Mar 23

16%

-13%

Excludes dividends paid by subsidiaries of the Group to non-controlling equity holders of $13 million (Sep 23 half: $14 million; Mar 23 half: $13 million).

Ordinary Shares
ANZBGL paid a 2023 final dividend of $2,771 million to its intermediate holding company, ANZ BH Pty Ltd, a wholly owned subsidiary of ANZGHL, during
the March 2024 half.
On 6 May 2024, the Directors proposed a 2024 interim dividend of $2,496 million be paid on 1 July 2024, to ANZ BH Pty Ltd.

20

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
6.

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.
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.
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).
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.

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.

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.

21

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
6.

Segment reporting, cont’dii) 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.

March 2024 Half YearNet interest income

Australia
Australia
Retail Commercial Institutional
$M
$M
$M

New
Zealand$M

Pacific$M

Group
Centre
$M

Group
Total
$M

2,608

1,580

1,882

1,572

63

195

7,900

Net fee and commission income

247

146

368

207

8

(13)

963

Net income from insurance business

48

-

-

-

-

-

48

Other income1,2

6

23

1,319

1

36

(42)

1,343

-

-

-

96

96

-

-

1,2

Operating income

2,909

1,749

3,569

1,780

107

236

10,350Operating expenses(1,735)(763)(1,444)

(677)

(70)

(490)

(5,179)Cash profit before credit impairment and income tax

1,174

986

2,125

1,103

37

(254)

5,171

(43)

(35)

6

(4)

6

-

(70)

Share of associates’ profit/(loss)

Credit impairment (charge)/releaseCash profit before income tax

1,131

951

2,131

1,099

43

(254)

5,101

Income tax expense1,2

(337)

(286)

(609)

(308)

(11)

59

(1,492)

Non-controlling interests
Cash profit/(loss)

-

-

-

-

(1)

(13)

(14)

794

665

1,522

791

31

(208)

3,595

Economic hedges1(197)

Revenue and expense hedges2

52

Profit after tax attributable to shareholders

3,450

Financial Position
Total external assets

325,775

64,279513,026

124,986

3,195

58,877

1,090,138

Total external liabilities

176,484

122,386

407,444

122,310

3,791

187,5211,019,936

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).

22

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
6.

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

188

8,071

Net fee and commission income

311

160

339

199

9

(9)

1,009

Net income from insurance business

53

-

-

-

-

-

53

Other income1,2

10

30

982

11

36

37

1,106

-

-

-

125

125

Share of associates’ profit/(loss)

-

-

1,2

Operating income

3,068

1,782

3,290

1,777

106

341

10,364

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

(665)

(71)

(481)

(5,101)

Cash profit before credit impairment and income tax

1,310

1,044

1,902

1,112

35

(140)

5,263

(53)

(41)

6

(37)

12

1

(112)

Cash profit before income tax

1,257

1,003

1,908

1,075

47

(139)

5,151

Income tax expense1,2

(383)

(302)

(548)

(300)

(8)

34

(1,507)

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

-

-

-

-

(2)

(12)

(14)

874

701

1,360

775

37

(117)

3,630

Economic hedges1(27)

Revenue and expense hedges2(6)

Profit after tax attributable to shareholders

3,597

Financial Position
Total external assets

315,207

61,916

538,825

125,178

3,391

61,547

1,106,064

Total external liabilities

168,926

119,341

452,777

122,924

3,862

169,149

1,036,979

March 2023 Half YearNet interest income

3,015

1,632

2,071

1,582

62

135

8,497

Net fee and commission income

235

162

346

199

10

(15)

937

Net income from insurance business

55

-

-

-

-

-

55

Other income1,2

6

13

1,027

-

30

(117)

959

-

-

-

100

100

Share of associates’ profit/(loss)

-

-

1,2

Operating income

3,311

1,807

3,444

1,781

102

103

10,548Operating expenses(1,703)(685)(1,340)

(634)

(74)

(550)

(4,986)

Cash profit before credit impairment and income tax

1,608

1,122

2,104

1,147

28

(447)

5,562

(82)

(66)

74

(75)

16

-

(133)

Cash profit before income tax

1,526

1,056

2,178

1,072

44

(447)

5,429

Income tax expense1,2

(462)

(317)

(589)

(301)

(10)

114

(1,565)

Non-controlling interests

-

-

-

-

-

(14)

(14)

1,064

739

1,589

771

34

(347)

3,850

Credit impairment (charge)/releaseCash profit/(loss)
Economic hedges1(190)

Revenue and expense hedges2(84)

Profit after tax attributable to shareholders

3,576

Financial Position
Total external assets

303,820

60,227525,745

123,565

3,489

94,796

1,111,642

Total external liabilities

160,297

119,042

450,764

121,580

3,834

187,529

1,043,046

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).

23

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
7.

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

173,764

169,696

166,701

2%

4%

927

961

916

-4%

1%

502,989489,287474,616

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

716,162

708,280

691,756

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 8)
Net loans and advances
1.

Amortised over the expected life of the loan.

24

3,642

3,475

3,165

5%

15%

719,310711,240

694,395

1%

4%(3,489)(3,546)(3,658)-2%-5%715,821707,694

690,737

1%

4%

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
8.

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.

25

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
8.

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

26

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
8.

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).

27

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
9.

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

283,400

278,295

270,7252%

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

42,26731,22436,47535%

16%

Total Australia

501,476

485,999498,266

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 borrowings

807,189815,203

843,098

-1%

-4%

28

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
10.

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.

29

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
11.

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
715,821

Sep 23$M
707,694

Mar 23$M
690,737

Mar 24$M-

Sep 23$M-

Mar 23$M-

Mar 24$M
715,821

Sep 23$M
707,694

Mar 23$M
690,737

7,900

7,752

7,912

-

-

-

7,900

7,752

7,912
84,589Investment securities- debt securities at amortised cost
- debt securities at FVOCI

108,530

88,271

84,589---108,530

88,271- equity securities at FVOCI

1,188

946

997

1,188

946

997

-

-

-

- debt securities at FVTPL

-

-

7

-

-

-

-

-

7

Other financial assets
Total on-balance sheet positions

244,928

288,534

314,685

8,640

15,3008,521

236,288273,234

306,164

1,078,367

1,093,197

1,098,927

9,828

16,246

9,518

1,068,539

1,076,951

1,089,409

Off-balance sheet commitments
Undrawn and contingent facilities2
Total
1.
2.

289,371

290,055

292,550---

289,371

290,055

292,550

1,367,738

1,383,252

1,391,477

9,828

16,246

9,518

1,357,910

1,367,006

1,381,959

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 ECL.

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

30

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
11.

Credit risk, cont’d

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

As at March 2024

Stage 1
$M

Stage 2
$M

Strong405,604

16,931--

422,535

Satisfactory

199,316

39,766--

239,082

Weak12,541

12,086--

24,627

-

-

5,011

880

5,891

617,461

68,7835,011

880

692,135

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

(399)

(320)

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

616,229

67,245

4,612

560

688,646

0.20%

2.24%

7.96%

36.36%

Defaulted
Gross loans and advances at amortised cost

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

715,821

As at September 2023
Strong411,583

17,063--428,646

Satisfactory

193,170

37,977--

231,147

Weak

11,306

10,398--21,704

-

-

3,858

1,037

4,895
686,392

Defaulted
Gross loans and advances at amortised cost

616,059

65,438

3,858

1,037

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

(329)

(366)

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

614,832

63,814

3,529

671

682,846

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

707,694

As at March 2023
Strong416,703

Satisfactory

176,054

40,305

Weak

10,072

10,293

-

-

3,378

804

4,182

Gross loans and advances at amortised cost

602,829

65,2763,378

804

672,287

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

(356)

(414)

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

601,670

63,5473,022

390

668,629

0.19%

2.65%

10.54%

51.49%

Defaulted

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

14,678--431,381--

216,359--

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

Capitalised brokerage and other origination costs

3,165

Net carrying amount

690,737

31

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
11.

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.

32

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
11.

Credit risk, cont’d

Investment securities - debt securities at amortised cost
Stage 3
Collectively
Individuallyassessedassessed$M$M

Stage 1
$M

Stage 2
$M

6,018

-

-

-

6,018

137

-

-

-

137

Weak

1,778

-

-

-

1,778

Gross investment securities - debt securities at amortised cost

7,933

-

-

-

7,933

As at March 2024
StrongSatisfactory

Allowance for ECL

Total
$M

(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

(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

(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

As at September 2023
StrongSatisfactory

Allowance for ECL

As at March 2023
StrongSatisfactory

Allowance for ECL

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

33

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
11.

Credit risk, cont’d

Other financial assets
As at

StrongSatisfactory1

Weak
Defaulted
1

Other financial assets
1.

Includes Investment securities - debt securities at FVTPL of nil (Sep 23: nil; Mar 23: $7 million).

34

Mar 24$M

Sep 23$M

Mar 23$M

230,915

270,012302,765

4,533

2,618

2,333

840

604

1,069

-

-

4

236,288273,234

306,171

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
12.

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

114,632

23,064

137,696

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

109,718

117,618

Net loans and advances

715,821691,794

24,027

Regulatory deposits

696

-

696

Other financial assets

4,563

-

4,563

831,635

246,732

1,078,367

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

777,10230,087807,189
42,728-42,728

Payables and other liabilities

11,0396,943

17,982

Debt issuances

125,362

1,747

127,109

Total

935,938

81,505

1,017,443

140,588

27,566

168,154

As at September 2023
Financial assets
Cash and cash equivalents
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

89,217

96,969Net loans and advances

685,806

21,888707,694

Regulatory deposits

646

-

646

Other financial assets

4,417

-

4,417

857,116

236,081

1,093,197

19,267-

19,267

Total
Financial liabilities
Settlement balances owed by ANZ
Collateral received

10,382-

10,382

Deposits and other borrowings

781,31433,889815,203

Derivative financial instruments-

57,482

57,482

Payables and other liabilities

10,717

5,267

15,984

Debt issuances

114,678

1,336

116,014

Total

936,358

97,974

1,034,332

35

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
12.

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

85,59393,505Net loans and advances

690,737

671,268

19,469Regulatory deposits

646

-

646

Other financial assets

3,749

-

3,749

883,932

214,995

1,098,927
23,010

Total
Financial liabilities
Settlement balances owed by ANZ

23,010-Collateral received

8,002

-

8,002

Deposits and other borrowings

811,770

31,328843,098

Derivative financial instruments-

46,154

46,154

Payables and other liabilities

9,208

4,733

13,941

Debt issuances

104,626

1,531

106,157

Total

956,616

83,746

1,040,362

36

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
12.

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.

37

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
12.

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

946

109,718-

23,428599

24,027

116,664

128,495

1,573

246,732

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

-

1,747

-

1,747

6,851

74,63915

81,505

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

27,566-

27,566

26,388

10,6142

37,00460,406935

59,44823

71,355

16,924938

89,217-

21,159729

21,88898,678135,711

1,692

236,081-

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

Investment securities1
Net loans and advances (measured at fair value)
Total
Liabilities
Deposits and other borrowings (designated at fair value)

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 securities1
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

16,421996

85,593-19,089380

19,46995,084

118,510

1,401

214,995

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

Debt issuances (designated at fair value)
Total
1.

-

1,531

-

1,531

4,337

79,38326

83,746

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.

38

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
12.

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 $1,558 million (Sep 23: $1,669 million; Mar 23: $1,375 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 $98 million (Sep 23: $89 million; Mar 23: $89 million) of unlisted equities classified as FVOCI, for which there are no active markets ortraded prices available, resulting in a Level 3 classification. The increase in unlisted equity holdings balance was mainly due to additional investment
purchases and foreign currency translation impacts 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 $95 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.

39

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
12.

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

109,718

117,618

117,616

Net loans and advances

691,794

24,027

715,821714,934

Total

699,694

133,745

833,439

832,550

Deposits and other borrowings

777,10230,087807,189

806,994

Debt issuances

125,362

1,747

127,109

127,921

Total

902,464

31,834934,298

934,915

Investment securities1

7,752

89,217

96,96996,929Net loans and advances

685,806

21,888707,694

705,627

Total

693,558

111,105

804,663

802,556

Deposits and other borrowings

781,31433,889815,203

814,995

Debt issuances

114,678

1,336

116,014

115,989Total

895,992

35,225931,217930,984

Investment securities1

7,912

85,59393,50593,491

Net loans and advances

671,268

19,469690,737

688,107

Total

679,180

105,062784,242

781,598

Deposits and other borrowings

811,770

31,328843,098

842,750

Debt issuances

104,626

1,531

106,157

105,800

Total

916,396

32,859949,255

948,550

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.

40

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
13.

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%

72

82

58

-12%

24%

(632)

(554)

(458)

14%

38%

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

-40%

-13%

(22)

(22)

(22)

0%

0%

Total reserves(1,510)(1,796)(1,065)-16%

42%

Retained earnings

41,911

41,27740,082

2%

5%

Share capital and reserves attributable to shareholders of the Company

69,43468,56368,071

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%

70,202

69,08568,5962%

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.
3,003,366,782

Sep 23No.
3,003,366,782

Mar 23
No.
2,989,923,751

Bonus option plan--

1,657,422

Dividend reinvestment plan issuances--

8,406,978

Employee share and option plans--

3,378,631

3,003,366,782

3,003,366,782

3,003,366,782

1

Closing balance
1.

Following the establishment of ANZGHL, the parent entity of ANZBGL, shares held by ANZEST Pty Ltd are no longer considered treasury shares to the Group.

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.

41

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
14.

Changes in composition of the Group

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

15.

Investments in associates
Half Year
Mar 24$M
96

Share of associates' profit/(loss)

Contributions to profit

Sep 23$M
125

Mar 24v. Mar 23-4%

Half Year

As at

P.T. Bank Pan Indonesia (PT Panin)

Sep 23$M
67

AMMB Holdings Berhad (AmBank)1

65

58

-

-

96

125

100

Share of associates' profit/(loss)

Mar 24v. Sep 23-23%

Ownership interest
held by GroupMar 24$M
31

1.

Mar 23$M
100

Contribution toGroup profit after tax

Associates

Other associates

Movement

Mar 24%39

Sep 23%
39

Mar 23
%
39

63

5

22

22

(19)

n/a

n/a

n/a

Mar 23$M
56

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.

16.

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.

42

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
17.

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

243,975

0%-2%Contract amount of:

Guarantees and letters of credit

23,39023,55623,090-1%

1%

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 32 of the 2023 ANZBGL 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 the Company
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 the Company
alleging failure to comply with continuous disclosure obligations in connection with the Company’s August 2015 underwritten institutional shareplacement. In October 2023, the Federal Court of Australia found that the Company 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 the Company. In December 2023, the Company lodged a Notice of Appeal fromthe decision of the Federal Court of Australia.

•

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

•

OnePath superannuation litigation
In December 2020, a class action was brought against OnePath Custodians, OnePath Life and the Company alleging that OnePath Custodiansbreached its obligations under superannuation legislation, and its duties as trustee, in respect of superannuation investments and fees. The claim
also alleges that the Company was involved in some of OnePath Custodians’ investment breaches. The Company 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 the Company alleging that certain interest terms in credit card contracts were unfair contract
terms and that it was unconscionable for the Company to rely on them. An agreement to settle the claim was reached in March 2024. The Company
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.

43

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
17.
•

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, the Company completed the sale to Standard Chartered Bank of ANZ Grindlays Bank Limited (Grindlays) and certain otherbusinesses. The Company 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 BankThe Company is pursuing recovery of the proceeds of certain disputed cheques which were credited to the account of a former Grindlays customer inthe early 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 the Company and NHB.

44

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
18.

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.

19.

Significant events since balance date

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

45

DIRECTORS’ DECLARATION
Directors’ Declaration
The Directors of Australia and New Zealand Banking Group 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

46

AUDITOR’S REVIEW REPORT AND INDEPENDENCE DECLARATION

Independent Auditor’s Review Report to the shareholders of Australia and New Zealand Banking Group Limited
Conclusion
We have reviewed the accompanying Condensed Consolidated Financial Statements of Australia and New Zealand Banking Group 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 Australia and New Zealand Banking Group 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 19 including selected explanatory notes; and•The Directors’ Declaration.

The Group comprises Australia and New Zealand Banking Group 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 a Financial Report 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.

47

AUDITOR’S REVIEW REPORT AND INDEPENDENCE DECLARATION

Lead Auditor’s Independence Declaration under Section 307C of the Corporations Act 2001
To the Directors of Australia and New Zealand Banking Group Limited
I declare that, to the best of my knowledge and belief, in relation to the review of Australia and New Zealand Banking Group 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.

48