AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED- ANZBGL NEW ZEALAND
REGISTERED BANK DISCLOSURE STATEMENTFOR THE SIX MONTHS ENDED 31 MARCH 2023

CONTENTS
Glossary of terms

2

DISCLOSURE STATEMENTInterim Financial Statements
Condensed consolidated interim financial statements
Notes to the interim financial statements
Limited Assurance Report on the Interim Financial Statements

3
4
8
21

Registered Bank Disclosures
Directors’ and New Zealand Chief Executive Officer’s Statement

22
32
33

Limited Assurance Reports on the Registered Bank Disclosures

GLOSSARY OF TERMS
In this Registered Bank Disclosure Statement (Disclosure Statement) unless the context otherwise requires:
Bank means ANZ Bank New Zealand Limited.
Banking Group means the Bank and all its controlled entities.
Immediate Parent Company means ANZ Funds Pty Limited, which is the immediate parent company of ANZ Holdings (New Zealand)
Limited.
Ultimate Non-Bank Holding Company means ANZ Group Holdings Limited.
Ultimate Parent Bank means Australia and New Zealand Banking Group Limited.
Overseas Banking Group means the worldwide operations of the Ultimate Parent Bank including its controlled entities.
New Zealand business means all business, operations, or undertakings conducted in or from New Zealand identified and treated as if itwere conducted by a company formed and registered in New Zealand.
NZ Branch means the New Zealand business of the Ultimate Parent Bank.
ANZBGL New Zealand, We or Our means the New Zealand business of the Overseas Banking Group.
Registered Office is Level 10, 171 Featherston Street, Wellington, New Zealand, which is also the NZ Branch’s address for service.
RBNZ means the Reserve Bank of New Zealand.
APRA means the Australian Prudential Regulation Authority.
the Order means the Registered Bank Disclosure Statements (Overseas Incorporated Registered Banks) Order 2014.
Any term or expression which is defined in, or in the manner prescribed by, the Order shall have the meaning given in or prescribed by
the Order.
2

INTERIM FINANCIAL
STATEMENTS
Condensed consolidated interim financial statements
Income statement

4Statement of comprehensive income

4

Balance sheet

5

Cash flow statement

6

Statement of changes in equity

7

Notes to the condensed consolidated interim financial statements
Basis of preparation
1. About our interim financial statements

8

Financial performance
2. Other operating income

9

3. Segment reporting

10

Financial and non-financial assets
4. Net loans and advances

11

5. Allowance for expected credit losses

12

Financial and non-financial liabilities
6. Deposits and other borrowings

16

7. Debt issuances

16

Financial instrument disclosures
8. Credit risk

17

9. Fair value of financial assets and financial liabilities

19

Other disclosures
10. Commitments and contingent liabilities

20

3

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZBGL NEW ZEALAND

UNAUDITEDINTERIM FINANCIAL STATEMENTS
INCOME STATEMENT
2023
NZ$m

2022
NZ$m

Interest income

4,675

2,458

Interest expense(2,548)

(697)

2,127

1,761

225

563

Operating income

2,352

2,324

Operating expenses

(811)

(826)

1,541

1,498

(121)

20

1,420

1,518

For the six months ended 31 MarchNote

Net interest income
Other operating income

2

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

5

Income tax expense

(398)

(422)

Profit for the period

1,022

1,096

Comprising:
Profit attributable to shareholders of the Ultimate Parent Bank

1,008

1,096

14

-

Profit attributable to non-controlling interests

STATEMENT OF COMPREHENSIVE INCOME
For the six months ended 31 March

2023
NZ$m

2022
NZ$m

Profit for the period

1,022

1,096

-

3

Unrealised losses recognised directly in equity

(28)

(58)

Realised gains transferred to the income statement

(12)

(29)

Income tax attributable to the above items

11

23

Other comprehensive income after tax

(29)

(61)

Total comprehensive income for the period

993

1,035

Shareholders of the Ultimate Parent Bank

979

1,035

Non-controlling interests

14-

Other comprehensive income
Items that will not be reclassified subsequently to profit or loss
Items that may be reclassified subsequently to profit or loss
Reserve movements:

Comprising total comprehensive income attributable to:

The notes appearing on pages 8 to 20 form an integral part of these interim financial statements

4

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZBGL NEW ZEALAND

UNAUDITEDBALANCE SHEET
As at

Note

AssetsCash and cash equivalents

31 Mar 23
NZ$m

30 Sep 22
NZ$m

12,657

12,575

Settlement balances receivable

516

785

Collateral paid

576

1,672

Trading securities

5,657

7,228

Derivative financial instruments

6,339

15,478Investment securities

11,211

11,357

147,423

147,373-4

Net loans and advances

4

Investments in associates
Current tax assets

9-

Deferred tax assets

354

363

3,096

3,099

Premises and equipment

423

450

Other assets

991

1,055

Total assets

Goodwill and other intangible assets

189,252

201,439

Liabilities
Settlement balances payable

3,375

4,887

Collateral received

1,056

1,962

142,120

142,482

6,271

13,571

Deposits and other borrowings

6

Derivative financial instruments
Current tax liabilities
Payables and other liabilities
Employee entitlements
Other provisions

-

315

1,935

1,367

122

128

209

222

18,033

20,483

Total liabilities (excluding head office account)

173,121

185,417

Net assets (excluding head office account)

16,131

16,022

11,055

11,05519

48

Debt issuances

7

EquityShare capital and initial head office accountReserves
Retained earnings

4,507

4,369

Equity attributable to shareholders of the Ultimate Parent Bank
Non-controlling interests

15,581

15,472550

550

Total equity & head office account16,131

16,022The notes appearing on pages 8 to 20 form an integral part of these interim financial statements

5

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZBGL NEW ZEALAND

UNAUDITEDINTERIM FINANCIAL STATEMENTS
CASH FLOW STATEMENT
For the six months ended 31 March

2023
NZ$m

2022
NZ$m

Profit after income tax

1,022

1,096

60

63

Adjustments to reconcile to net cash flows from operating activities:
Depreciation and amortisation

1

1

Net derivatives/foreign exchange adjustment

742

(103)

Other non-cash movements

(134)

(8)

Collateral paid

1,096

(75)

Trading securities

Loss on sale and impairment of premises and equipment

Net (increase)/decrease in operating assets:
1,571

1,767

Net loans and advances(50)(5,323)

Other assets

333

(676)

Deposits and other borrowings (excluding items included in financing activities)(1,228)

5,060

Settlement balances payable(1,512)

1,888

Collateral received

(906)

332

Other liabilities

256

(409)

Total adjustments

229

2,517

1,251

3,613

(2,822)(2,241)

3,348

3,551

Net increase/(decrease) in operating liabilities:

Net cash flows from operating activities1
Cash flows from investing activities
Investment securities:
Purchases2
Proceeds from sale or maturity

2

Other assets

(30)

(58)

Net cash flows from investing activities

496

1,252

1,000

500

Issue proceeds

500

2,680

Redemptions(2,203)(3,753)

(55)

(56)

Cash flows from financing activities
Deposits and other borrowings (excluding borrowings from Immediate Parent and Ultimate Parent Bank)3
Debt issuances:

4

Borrowings from Immediate Parent and Ultimate Parent Bank:5
Change in short term borrowings
Repayment of lease liabilities

(23)

(22)

Dividends paid

(884)

(880)

Net cash flows from financing activities(1,665)(1,531)

Net change in cash and cash equivalents

82

3,334

Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period
1
2
3
4
5

7,844

12,657

11,178Net cash provided by operating activities includes income taxes paid of NZ$702 million (2022: NZ$542 million).
Comparative amounts for purchases and proceeds were previously grossed up by NZ$3,328 million, and have been updated accordingly.
Movement in deposits and other borrowings includes repurchase transactions entered into with the RBNZ under the Funding for Lending Programme of NZ$1,000 million (2022: NZ$500
million).
Movement in debt issuances (Note 7 Debt issuances) also includes a NZ$975 million decrease (2022: NZ$670 million decrease) from the effect of foreign exchange rates, a NZ$226 million
increase (2022: NZ$643 million decrease) from changes in fair value hedging instruments and a NZ$2 million increase (2022: NZ$17 million increase) from other changes.
Movement in borrowings from Immediate Parent and Ultimate Parent Bank (Note 6 Deposit and other borrowings) also includes a NZ$103 million decrease (2022: NZ$9 million decrease)from the effect of foreign exchange rates and a NZ$24 million increase (2022: NZ$61 million decrease) from changes in fair value hedging instruments.

The notes appearing on pages 8 to 20 form an integral part of these interim financial statements

6

12,575

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZBGL NEW ZEALAND

UNAUDITEDSTATEMENT OF CHANGES IN EQUITY

Equityattributabletoshareholdersof theUltimate
Parent Bank
NZ$m

Noncontrollinginterests
NZ$m

Total
shareholders'equityNZ$mShare capitaland initialhead
officeaccount
NZ$m

Reserves
NZ$m

Retainedearnings
NZ$m

11,055
-

70
-

3,951
1,096

15,076
1,096-

15,076
1,096

Other comprehensive income for the period

-

(63)

2

(61)

-

(61)

Total comprehensive income for the period
Transactions with equity holders in theircapacity as equity owners:
Ordinary dividend paid

-

(63)

1,098

1,035

-

1,035

As at 1 October 2021
Profit for the period

-

-

(880)

(880)

-

(880)

As at 31 March 2022

11,055

7

4,169

15,231-

15,231As at 1 October 2022

11,05548

4,369

15,472550

16,022

Profit for the period

-

-

1,008

1,008

14

1,022

Other comprehensive income for the period

-

(29)

-

(29)

-

(29)

Total comprehensive income for the period
Transactions with equity holders in theircapacity as equity owners:
Ordinary dividend paid

-

(29)

1,008

979

14

993

-

-

(870)

(870)

-

(870)

Preference dividends paid

-

-

-

-

(14)

(14)

11,05519

4,507

15,581550

16,131As at 31 March 2023

The notes appearing on pages 8 to 20 form an integral part of these interim financial statements

7

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZBGL NEW ZEALAND

UNAUDITEDNOTES TO THE INTERIM FINANCIAL STATEMENTS
1.

ABOUT OUR INTERIM FINANCIAL STATEMENTS

NEW ULTIMATE NON-BANK HOLDING COMPANY
On 3 January 2023, the Ultimate Parent Bank established, by a scheme of arrangement, a non-operating holding company, ANZ Group Holdings
Limited, as the new listed parent holding company of the ANZ Group and implemented a restructure to separate the Overseas Banking Group’sbanking and certain non-banking businesses into the ANZ bank group and ANZ non-bank group. The ANZ bank group comprises the majority of thebusinesses and subsidiaries that were held in Australia and New Zealand Banking Group Limited prior to the restructure. The ANZ non-bank group
comprises banking-adjacent businesses developed or acquired by the ANZ Group to focus on bringing new technology and banking-adjacentservices to its customers, and a separate service company. The Ultimate Parent Bank is unchanged.
The restructure had no material effect on these condensed consolidated interim financial statements (financial statements).

BASIS OF PREPARATION
These financial statements for ANZBGL New Zealand have been prepared in accordance with the requirements of the Order and should be read in
conjunction with ANZBGL New Zealand’s financial statements for the year ended 30 September 2022.
On 8 May 2023, the Directors resolved to authorise the issue of these financial statements.
These financial statements comply with:• New Zealand Generally Accepted Accounting Practice (NZ GAAP), as defined in the Financial Reporting Act 2013;• NZ IAS 34 Interim Financial Reporting and other applicable Financial Reporting Standards, as appropriate for publicly accountable for-profit
entities; and• IAS 34 Interim Financial Reporting.
The consolidated financial statements of ANZBGL New Zealand comprise the financial statements of the NZ Branch and all of the New Zealandbusinesses of all the subsidiaries of the Ultimate Parent Bank.
We present the financial statements in New Zealand dollars and have rounded values to the nearest million dollars (NZ$m), unless otherwise stated.
The accounting policies adopted by ANZBGL New Zealand are consistent with those adopted and disclosed in the previous full year financial
statements.

BASIS OF MEASUREMENT
We have prepared the financial information in accordance with the historical cost basis except for the following assets and liabilities which we havestated at their fair values:• derivative financial instruments;• financial assets and liabilities held for trading;• financial assets and liabilities designated at fair value through profit and loss (FVTPL); and• financial assets at fair value through other comprehensive income (FVOCI).

KEY JUDGEMENTS AND ESTIMATES
The preparation of these financial statements requires the use of management judgement, estimates and assumptions impacting theapplication 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 previous full year financial statements. Such estimates and judgements
are reviewed on an ongoing basis.
The global economy is facing challenges associated with high inflation, increasing interest rates, labour market constraints, and continuing
geopolitical tensions which contributes to an elevated level of estimation uncertainty involved in the preparation of these financial
statements.
ANZBGL New Zealand has made various accounting estimates in these financial statements based on forecasts of economic conditions
which reflect expectations and assumptions at 31 March 2023 about future events considered reasonable in the circumstances. Thus there isa 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 andassociated 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 in the relevant notes of these financial
statements and/or in the relevant notes in the previous full year financial statements. Readers should consider these disclosures in light of theinherent uncertainties described above.

8

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZBGL NEW ZEALAND

2.

UNAUDITEDOTHER OPERATING INCOME

For the six months ended 31 March(i) Fee and commission income
Lending fees
Non-lending fees
Commissions
Funds management income
Fee and commission income
Fee and commission expense
Net fee and commission income(ii) Other income
Net trading gains
Gain on sale of investment securities designated at fair value through other comprehensive income
Fair value gain / (loss) on hedging activities and financial liabilities designated at fair value
Net foreign exchange earnings and other financial instruments income
Release of provisions for UDC Finance Ltd and Paymark Ltd disposal costs
Other
Other income
Other operating income

2023
NZ$m

2022
NZ$m

13
375
15
120
523
(273)
250

13
341
16
130
500
(242)
258

105
13
(146)
(28)
3
(25)
225

74
31
183
288
14
3
305
563

9

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZBGL NEW ZEALAND

UNAUDITEDNOTES TO THE INTERIM FINANCIAL STATEMENTS
3.

SEGMENT REPORTINGANZBGL New Zealand is organised into three major business segments for segment reporting purposes - Personal, Business and Institutional.
Centralised back office and corporate functions support these segments. These segments are consistent with internal reporting provided to the chief
operating decision maker, being the Bank’s Chief Executive Officer.
Segment reporting has been updated to reflect the transfer of certain larger business and property finance customers from Business to Institutional.
The transfer aligns the customer needs with the right support and expertise delivering a better customer experience. Comparative amounts havebeen adjusted to be consistent with the current period’s segment definitions. The change resulted in the movement of NZ$11.9 billion of net loans
and advances, NZ$3.5 billion of customer deposits and NZ$200 million of goodwill as at 30 September 2022, and NZ$88 million of profit after tax forthe six months ended 31 March 2022, from Business to Institutional.
Personal
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
Business provides a full range of banking services including small business lending, through our digital, branch and contact centres channels, andtraditional relationship banking and sophisticated financial solutions through dedicated managers. These cover privately owned small, medium andlarge enterprises, the agricultural business segment, government and government related entities.
Institutional
The Institutional division services governments, global institutional and corporate customers 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 and corporate advisory services.
• Markets provide customers with risk management services on foreign exchange, interest rates, credit, commodities and debt capital markets inaddition to managing ANZBGL New Zealand’s interest rate exposure and high quality liquid asset portfolio.
Other
Other includes treasury and back office support functions, none of which constitutes a separately reportable segment.
Personal

Business

Institutional

Other

Total

For the six months
ended 31 March

2023

2022

2023

2022

2023

2022

2023

2022

2023

2022

NZ$m

NZ$m

NZ$m

NZ$m

NZ$m

NZ$m

NZ$m

NZ$m

NZ$m

NZ$m

Net interest income

1,218

1,024

496

415

348

318

65

4

2,127

1,761

Net fee and commission income- Lending fees
- Non-lending fees

3

4

-

1

10

8

-

-

13

13

220

196

132

121

23

24

-

-

375

341

- Commissions

15

15

-

-

-

1

-

-

15

16

- Funds management income

120

130

-

-

-

-

-

-

120

130

- Fee and commission expense

(167)

(144)

(106)

(98)

-

-

-

-

(273)

(242)

Net fee and commission income

191

201

26

24

33

33

-

-

250

258

1

1

-

-

147

79

(173)

225

(25)

305

Other income
Other operating income

192

202

26

24

180

112

(173)

225

225

563

Operating income

1,410

1,226

522

439

528

430

(108)

229

2,352

2,324

Operating expenses

(574)

(585)

(109)

(102)

(113)

(125)

(15)

(14)

(811)

(826)

Profit before credit impairment
and income tax

836

641

413

337

415

305

(123)

215

1,541

1,498

Credit impairment release /(charge)

(50)

(26)

(32)

58

(39)

(12)

-

-

(121)

20

Profit / (loss) before income tax

786

615

381

395

376

293

(123)

215

1,420

1,518

(220)

(173)

(107)

(111)

(105)

(82)

34

(56)

(398)

(422)

-

-

-

-

-

-

(14)

-

(14)

-

566

442

274

284

271

211

(103)

159

1,008

1,096

Income tax credit / (expense)
Non-controlling interests
Profit / (loss) after income tax
1

10

1

Attributable to shareholders of the Ultimate Parent Bank.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZBGL NEW ZEALAND

Personal

UNAUDITEDBusiness

Institutional

Other

Total

31 Mar 23 30 Sep 22 31 Mar 23 30 Sep 22 31 Mar 23 30 Sep 22 31 Mar 23 30 Sep 22 31 Mar 23 30 Sep 22
As at

NZ$m

NZ$m

NZ$m

NZ$m

NZ$m

NZ$m

NZ$m

NZ$m

NZ$m

NZ$m

1,042

1,042

695

695

1,269

1,269

-

-

3,006

3,006

Net loans and advances

103,509

103,015

24,92425,56018,99018,798--147,423

147,373

Customer deposits

86,10885,391

18,506

19,05925,68425,880--130,298

130,330

Financial position
Goodwill

Other segment
The Other segment profit/(loss) after tax comprises:
For the six months ended 31 March

2023
NZ$m

2022
NZ$m

Personal and Business central functions
Group Centre
Economic hedges
Total

2
(105)
(103)

20
11
128
159

31 Mar 23
NZ$m
938
1,264
104,593
40,989147,784(32)
421
148,173(750)
147,42330 Sep 22
NZ$m
968
1,238
104,178
41,234
147,618(32)
433
148,019(646)
147,373

4. NET LOANS AND ADVANCES
Note
Overdrafts
Credit cards
Term loans - housing
Term loans - non-housing
Subtotal
Unearned income
Capitalised brokerage and other origination costs
Gross loans and advances
Allowance for expected credit losses
Net loans and advances

5

11

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZBGL NEW ZEALAND

UNAUDITEDNOTES TO THE INTERIM FINANCIAL STATEMENTS
5.

ALLOWANCE FOR EXPECTED CREDIT LOSSES

This note should be read in conjunction with the estimates, assumptions and judgements included in Note 1 About our interim financial statements.

Net loans and advances at amortised cost
Off-balance sheet commitments
Total

31 Mar 23

30 Sep 22

Collectively Individuallyassessedassessed
NZ$m
NZ$m
662
88
105
5
767
93

Total
NZ$m
750
110
860

Collectively Individuallyassessedassessed
NZ$m
NZ$m
569
77
100
5
669
82

Total
NZ$m
646
105
751

Stage 2
NZ$m
311
(20)
107
398

Stage 3
Collectively Individuallyassessedassessed
NZ$m
NZ$m
59
77
1
10
37
(9)
(16)
(1)
70
88

Total
NZ$m
646
130
(9)
(16)
(1)
750

The following tables present the movement in the allowance for expected credit losses (ECL).
Net loans and advances
Allowance for ECL is included in net loans and advances.

As at 1 October 2022
Transfer between stages
New and increased provisions (net of collective provision releases)
Write-backs
Bad debts written-off (excluding recoveries)
Discount unwind reversal
As at 31 March 2023

Stage 1
NZ$m
199
19
(24)
194

Off-balance sheet credit related commitments - undrawn and contingent facilities
Allowance for ECL is included in other provisions.
As at 1 October 2022
Transfer between stages
New and increased provisions (net of collective provision releases)
As at 31 March 2023

66
2
68

31
(2)
5
34

3
3

5
5

105
5
110

CREDIT IMPAIRMENT CHARGE – INCOME STATEMENT
For the six months ended 31 March
New and increased provisions- Collectively assessed- Individually assessed
Write-backs
Recoveries of amounts previously written-off
Total credit impairment charge / (release)

12

2023
NZ$m

2022
NZ$m

98
37
(9)
(5)
121

(16)
35
(22)
(17)
(20)

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZBGL NEW ZEALAND

UNAUDITEDKEY JUDGEMENTS AND ESTIMATES
Collectively assessed allowance for expected credit losses
In estimating collectively assessed ECL, ANZBGL New Zealand 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 be reasonable under the circumstances. ANZBGL New Zealand’s ECL estimates are inherently uncertain and, as a result, actual results
may differ from these estimates.
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 six months ended
31 March 2023

Determining
when asignificant
increase incredit risk
(SICR) has
occurred orreversedIn the measurement of ECL, judgement is involved indetermining whether there has been a SICR sinceinitial recognition of a loan, which would result in thefinancial asset moving from Stage 1 to Stage 2. This isa key area of judgement since transition from Stage 1
to Stage 2 increases the ECL from an allowance basedon the probability of default in the next 12 months, toan allowance for lifetime expected credit losses.
Subsequent decreases in credit risk resulting intransition from Stage 2 to Stage 1 may similarly resultin 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. ANZBGL New Zealandmonitors the effectiveness of SICR criteria on an
ongoing basis.

ANZBGL New Zealand has continued to adjust ECL
this period to account for expected deterioration incredit-worthiness of certain customer segments
which are considered particularly vulnerable toeconomic pressures such as higher interest rates,
elevated inflation and labour market pressures.

Measuringboth 12-monthand lifetime
credit losses

The probability of default (PD), loss given default(LGD) and exposure at default (EAD) factors used indetermining ECL are point-in-time measuresreflecting the relevant forward-looking information
determined by management. Judgement is involved
in determining which forward-looking information isrelevant for particular lending portfolios and for
determining each portfolio’s point-in-time sensitivity.
In addition, judgement is required where behaviouralcharacteristics are applied in estimating the lifetime ofa facility which is used in measuring ECL.

The PD, LGD and EAD models are subject to ANZBGLNew Zealand’s model risk policy that stipulates
periodic model monitoring and re-validation, anddefines approval procedures and authorities
according to model materiality.
There were no material changes to the policies.

Base caseeconomic
forecast

ANZBGL New Zealand derives a forward-looking ‘basecase’ economic scenario which reflects our view of
future macroeconomic conditions.

There have been no changes to the types of forwardlooking variables (key economic drivers) used asmodel inputs.
As at 31 March 2023, the base case assumptions havebeen updated to reflect elevated inflation, continuing
high interest rates, continued cost of living pressuresand tightness in the labour market.
The expected outcomes of key economic drivers forthe base case scenario at 31 March 2023 are described
below under the heading ‘Base case economic
forecast assumptions’.

13

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZBGL NEW ZEALAND

UNAUDITEDNOTES TO THE INTERIM FINANCIAL STATEMENTS
KEY JUDGEMENTS AND ESTIMATES
Judgement /assumption

1

Description

Considerations for the six months ended
31 March 2023

Probability
weighting ofeach economic
scenario (basecase, upside,
downside andseveredownsidescenarios)1

Probability weighting of each economic scenario is
determined by management considering the risks
and uncertainties surrounding the base caseeconomic scenario at each measurement date.
The assigned probability weightings are subject to ahigh degree of inherent uncertainty and therefore theactual outcomes may be significantly different tothose projected.

The probability weightings for each scenario
remained unchanged from 30 September 2022.
Weightings for current and prior periods are as
detailed in the section below under the heading on‘Probability weightings’.

Management
temporaryadjustments

Management temporary adjustments to the ECL
allowance are used in circumstances where it isjudged that our existing inputs, assumptions andmodel techniques do not capture all the risk factors
relevant to our lending portfolios. Emerging local or
global macroeconomic, microeconomic or politicalevents, and natural disasters that are not incorporated
into our current parameters, risk ratings, or forwardlooking information are examples of suchcircumstances.

Management have continued to apply adjustments toaccommodate uncertainty associated with higher
inflation and interest rates.
In addition, management overlays have been madefor risks particular to business banking.
Management temporary adjustments total NZ$171
million (September 2022: NZ$169 million).

The upside and downside scenarios are fixed by reference to average economic cycle conditions (that is, they are not based on the economic conditions prevailing at balance date) and are
based on a combination of more optimistic (in the case of the upside) and pessimistic (in the case of the downside) economic conditions.

Base case economic forecast assumptions
Continuing uncertainties described above increase the risk of the economic forecast resulting in an understatement or overstatement of the
ECL balance.
The economic drivers of the base case economic forecasts, reflective of our view of future macroeconomic conditions, used at 31 March2023 are set out below. For years beyond the near term forecasts below, the ECL models apply simplified assumptions for the economy tocalculate lifetime loss.
New ZealandGross domestic product (GDP) (annual % change)
Unemployment rate
Residential property prices (annual % change)
Consumer price index (CPI) (annual % change)

Actual calendar year
2022
2.8%
3.3%
-13.0%
7.2%

Forecast calendar year
2023
2024
1.4%
3.9%
-9.7%
6.1%

-0.1%
5.2%
2.2%
2.9%

The base case economic forecasts are for a continuing slowdown in economic activity. Continued high inflation and tight labour markets are
expected to keep interest rates high and dampen growth over the forecast period.

14

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZBGL NEW ZEALAND

UNAUDITEDKEY JUDGEMENTS AND ESTIMATES
Probability weightings
Probability weightings for each scenario are determined by management considering the risks and uncertainties surrounding the base caseeconomic scenario including the uncertainties described above.
Scenario weightings remain the same as those applied in September 2022 as noted in the table below.
The assigned probability weightings are subject to a high degree of inherent uncertainty and therefore the actual outcomes may be significantly
different to those projected. ANZBGL New Zealand considers these weightings to provide estimates of the possible loss outcomes and taking into
account short and long term inter-relationships within ANZBGL New Zealand’s credit portfolios. The weightings applied are set out below:

Base
UpsideDownside
Severe downside

31 Mar 23

30 Sep 22

45.0%
0.0%
40.0%
15.0%

45.0%
0.0%
40.0%
15.0%

ECL - Sensitivity analysis
Given current economic uncertainties and the judgement applied to factors used in determining the expected default of borrowers in future
periods, expected credit losses reported by ANZBGL New Zealand should be considered as a best estimate within a range of possible estimates.
The table below illustrates the sensitivity of ANZBGL New Zealand’s allowance for collectively assessed ECL to key factors used in determining it asat 31 March 2023:
Balance
Profit and Loss
Sheet
Impact
NZ$m
NZ$m
If 1% of Stage 1 facilities were included in Stage 2
If 1% of Stage 2 facilities were included in Stage 1

778
766

11
(1)

100% upside scenario
100% base scenario
100% downside scenario
100% severe downside scenario

182
310
598
1,453

(585)
(458)
(170)
686

Individually assessed allowance for expected credit losses
In estimating individually assessed ECL, ANZBGL New Zealand makes judgements and assumptions in relation to expected repayments, therealisable value of collateral, business prospects for the customer, competing claims and the likely cost and duration of the work-out process.
Judgements and assumptions in respect of these matters have been updated to reflect amongst other things, the continuing uncertainties
described above and in Note 1 About our interim financial statements.

15

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZBGL NEW ZEALAND

UNAUDITEDNOTES TO THE INTERIM FINANCIAL STATEMENTS
6. DEPOSITS AND OTHER BORROWINGS
Term deposits
On demand and short term deposits
Deposits not bearing interest
Total customer deposits
Certificates of deposit
Commercial paper
Securities sold under repurchase agreements
Borrowings from Ultimate Parent Bank and Immediate Parent Company
Deposits and other borrowings

7.

31 Mar 23
NZ$m
50,83160,133
19,334130,298
1,487
2,771
4,782
2,782
142,12030 Sep 22
NZ$m
46,746
62,203
21,381
130,330
1,639
2,955
4,642
2,916
142,482

DEBT ISSUANCESANZBGL New Zealand uses a variety of funding programmes to issue unsubordinated debt (including senior debt and covered bonds) andsubordinated debt. The difference between unsubordinated debt and subordinated debt is that holders of unsubordinated debt take priority overholders of subordinated debt owed by the relevant issuer and subordinated debt will be repaid by the relevant issuer only after the repayment ofclaims of depositors, other creditors and the unsubordinated debt holders.
31 Mar 23
30 Sep 22
NZ$m
NZ$m
Senior debt
12,23913,577
Covered bonds
4,151
4,082
17,659Total unsubordinated debt
16,390Subordinated debt
- ANZ Capital Notes
1,100- Other subordinated debt
1,724
1,643
2,824
Total subordinated debt
1,643
20,483
Total debt issued
18,033Covered bonds are guaranteed by ANZNZ Covered Bond Trust Limited (the Covered Bond Guarantor), solely in its capacity as trustee of ANZNZ
Covered Bond Trust (the Covered Bond Trust). The Covered Bond Trust is a member of ANZBGL New Zealand, whereas the Covered Bond Guarantor is
not a member of ANZBGL New Zealand.
Substantially all of the assets of the Covered Bond Trust are made up of certain housing loans and related securities originated by the Bank which are
security for the guarantee by the Covered Bond Guarantor as trustee of the Covered Bond Trust of issuances of covered bonds by the Bank, or its
wholly owned subsidiary ANZ New Zealand (Int’l) Limited, from time to time. The assets of the Covered Bond Trust are not available to creditors of theBank, although the Bank (or its liquidator or statutory manager) may have a claim against the residual assets of the Covered Bond Trust (if any) after all
priority ranking creditors of the Covered Bond Trust have been satisfied.

16

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZBGL NEW ZEALAND

8.

UNAUDITEDCREDIT RISKThis note should be read in conjunction with the estimates, assumptions and judgements included in Note 1 About our interim financial statements
and Note 5 Allowance for expected credit losses.
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
be differences between the carrying amounts reported on the balance sheet and the amounts reported in the tables below. Principally, thesedifferences arise in respect of financial assets that are subject to risks other than credit risk, such as equity instruments which are primarily subject tomarket risk, or bank 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 ANZBGL New Zealand would have to pay if the instrument is called upon.
The table below shows our 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.
Reported
31 Mar 23
30 Sep 22
NZ$m
NZ$m
On-balance sheet positions
Net loans and advances
Other financial assets:
Cash and cash equivalents
Settlement balances receivable
Collateral paid
Trading securities
Derivative financial instruments
Investment securities
Other financial assets2
Total other financial assets
Subtotal
Off-balance sheet commitments
Undrawn and contingent facilities3
Total
1
2
3

Excluded1
31 Mar 23
30 Sep 22
NZ$m
NZ$m

Maximum exposure tocredit risk
31 Mar 23
30 Sep 22
NZ$m
NZ$m

147,423

147,373--

147,423

147,373

12,657
516
576
5,657
6,339
11,211836
37,792
185,215

12,575
785
1,672
7,228
15,478
11,357952
50,047
197,420

183
183
183

154
154
154

12,474
516
576
5,657
6,339
11,211836
37,609185,032

12,421
785
1,672
7,228
15,478
11,357952
49,893
197,266

28,871
214,086

29,879227,299

183

154

28,871
213,903

29,879227,145

Coins, notes and cash at bank within cash and cash equivalents were excluded as they do not have credit risk exposure.
Other financial assets mainly comprise accrued interest and acceptances.
Undrawn and contingent facilities include guarantees, letters of credit and performance related contingencies, net of collectively assessed and individually assessed allowance for expectedcredit losses.

Credit quality
We use ANZBGL New Zealand’s internal customer credit rating (CCR) to manage the credit quality of financial assets. To enable wider comparisons,ANZBGL New Zealand’s CCRs are mapped to external rating agency scales as follows:
Credit quality
description

Internal CCR

ANZBGL New Zealand customer requirements

Moody’s
RatingS&P Global
Ratings

Strong

CCR 0+ to 4-

Demonstrated superior stability in their operating and financial
performance over the long-term, and whose earnings capacity is
not significantly vulnerable to foreseeable events.

Aaa – Baa3

AAA – BBB-

Satisfactory

CCR 5+ to 6-

Demonstrated sound operational and financial stability over the
medium to long-term even though some may be susceptible tocyclical trends or variability in earnings.

Ba1 – B1

BB+ – B+Weak

CCR 7+ to 8=

Demonstrated some operational and financial instability, withvariability and uncertainty in profitability and liquidity projected tocontinue 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, thefinancial instrument (or ‘the facility’) is classified as defaulted.

n/a

n/a

17

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZBGL NEW ZEALAND

UNAUDITEDNOTES TO THE INTERIM FINANCIAL STATEMENTS

Stage 1
NZ$m
120,988
15,064306
136,358(194)
136,164
0.14%

Stage 3
Collectively IndividuallyStage 2
assessedassessed
NZ$m
NZ$m
NZ$m
3,819
4,703
2,105
651
148
10,627
651
148
(398)
(70)
(88)
10,229581
60
3.75%
10.75%
59.46%

123,382
16,333257
139,972(199)
139,773
0.14%

2,686
3,019
1,205
6,910
(311)
6,599
4.50%

Net loans and advances

As at 31 March 2023
StrongSatisfactory
Weak
Defaulted
Subtotal
Allowance for ECL
Net loans and advances at amortised cost
Coverage ratio
Unearned income
Capitalised brokerage and other origination costs
Net carrying amountAs at 30 September 2022
StrongSatisfactory
Weak
Defaulted
Subtotal
Allowance for ECL
Net loans and advances at amortised cost
Coverage ratio
Unearned income
Capitalised brokerage and other origination costs
Net carrying amountOff-balance sheet commitments - undrawn and contingent facilities

As at 31 March 2023
StrongSatisfactory
Weak
Defaulted
Gross undrawn and contingent facilities
Allowance for ECL included in other provisions
Net undrawn and contingent facilities
Coverage ratio

Stage 1
NZ$m
24,6103,391
828,009(68)
27,941
0.24%

As at 30 September 2022
StrongSatisfactory
Weak
Defaulted
Gross undrawn and contingent facilities
Allowance for ECL included in other provisions
Net undrawn and contingent facilities
Coverage ratio

25,5933,368
828,969(66)
28,903
0.23%

18

590
590
(59)
531
10.00%

146
146
(77)
69
52.74%

Stage 3
Collectively IndividuallyStage 2
assessedassessed
NZ$m
NZ$m
NZ$m
178
678
98
13
5
954
13
5
(34)
(3)
(5)
920
10
3.56%
23.08%
100.00%

224
682
89
995
(31)
964
3.12%

14
14
(3)
11
21.43%

6
6(5)
1
83.33%

Total
NZ$m
124,807
19,767
2,411
799
147,784(750)
147,034
0.51%
(32)
421
147,423

126,068
19,352
1,462
736
147,618(646)
146,972
0.44%
(32)
433
147,373

Total
NZ$m
24,7884,069
106
18
28,981(110)
28,8710.38%

25,8174,050
97
20
29,984(105)
29,8790.35%

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZBGL NEW ZEALAND

UNAUDITED

9. FAIR VALUE OF FINANCIAL ASSETS AND FINANCIAL LIABILITIESFair value hierarchy
ANZBGL New Zealand categorises assets and liabilities carried at fair value into a fair value hierarchy as required by NZ IFRS 13 Fair Value Measurement
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.
The following table presents assets and liabilities carried at fair value in accordance with the fair value hierarchy:
Quoted market price(Level 1)
31 Mar 23
30 Sep 22
NZ$m
NZ$m
AssetsCash and cash equivalents1
Trading securities2
Derivative financial instruments
Investment securities2
Total
Liabilities
Deposits and other borrowings1
Derivative financial instruments
Other financial liabilities
Total
1
2

Fair value measurements
Using observable inputs
Using unobservable(Level 2)
inputs (Level 3)
31 Mar 23
30 Sep 22
31 Mar 23
30 Sep 22
NZ$m
NZ$m
NZ$m
NZ$m

Total
31 Mar 23
NZ$m

30 Sep 22
NZ$m

3,685
24
7,544
11,253

5,565
109
10,895
16,569

1,411
1,972
6,315
3,666
13,364

1,663
15,369461
17,493

1
1

1
1

1,411
5,657
6,339
11,211
24,6187,228
15,478
11,35734,063

11
801
812

8
364
372

3,753
6,249
10,002

2,955
13,551
16,506

11
11

12
12

3,753
6,271
801
10,825

2,955
13,571364
16,890During the six months ended 31 March 2023, within the trading book in its Markets business, a component of the Institutional division, ANZBGL New Zealand commenced the
management of repurchase agreements and associated reverse repurchase agreements on a fair value basis. This resulted in repurchase and associated reverse repurchase agreements
being recognised and measured at fair value through profit and loss.
During the six months ended 31 March 2023, NZ$2,882 million of assets were transferred from Level 1 to Level 2 due to a change of the observability of bond valuation inputs. There wereno other material transfers during the period. Transfers into and out of levels are measured at the beginning of the reporting period in which the transfer occurred.

Financial assets and financial liabilities not measured at fair value
Below is a comparison of the carrying amounts as reported on the balance sheet and fair values of financial asset and financial liability categories otherthan those categories where the carrying amount is at fair value or considered a reasonable approximation of fair value.
The fair values below have been calculated using discounted cash flow techniques where contractual future cash flows of the instrument are
discounted using discount rates incorporating wholesale market rates or market borrowing rates of debt with similar maturities or a yield curve
appropriate for the remaining term to maturity.
Carrying amountFinancial assets
Net loans and advances1
Total
Financial liabilities
Deposits and other borrowings2
Debt issuances1
Total
1
2

Fair value

31 Mar 23
NZ$m

30 Sep 22
NZ$m

31 Mar 23
NZ$m

30 Sep 22
NZ$m

147,423
147,423

147,373
147,373

146,278
146,278

145,759
145,759

138,367
18,033
156,400

139,527
20,483160,010138,236
17,928156,164

139,316
20,356
159,672

Fair value hedging is applied to certain financial instruments within these categories. The resulting fair value adjustments mean that the carrying value differs from the amortised cost.
Excludes commercial paper and securities sold under repurchase agreements (Note 6 Deposits and other borrowings) designated at fair value through profit or loss.

19

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZBGL NEW ZEALAND

UNAUDITEDNOTES TO THE INTERIM FINANCIAL STATEMENTS
10. COMMITMENTS AND CONTINGENT LIABILITIESCredit related commitments and contingencies
Contract amount of:
Undrawn facilities
Guarantees and letters of credit
Performance related contingencies
Total

31 Mar 23
NZ$m

30 Sep 22
NZ$m26,152
1,181
1,648
28,981

27,0601,225
1,699
29,984ANZBGL New Zealand guarantees the performance of customers by issuing standby letters of credit and guarantees to third parties, including its
Ultimate Parent Bank. The risk involved is essentially the same as the credit risk involved in extending loan facilities to customers, therefore thesetransactions are subjected to the same credit origination, portfolio management and collateral requirements for customers applying for loans. As thefacilities may expire without being drawn upon, the notional amounts do not necessarily reflect future cash requirements.
OTHER CONTINGENT LIABILITIESThere are outstanding court proceedings, claims and possible claims for and against ANZBGL New Zealand. 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 notdisclosed the estimated financial impact of the individual items either because it is not practicable to do so or because such disclosure may prejudiceseriously the interests of ANZBGL New Zealand.
REGULATORY AND CUSTOMER EXPOSURESANZBGL New Zealand 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 both in New Zealandand globally. ANZBGL New Zealand has received various notices and requests for information from its regulators as part of both industry-wide and
ANZBGL New Zealand-specific reviews, and has also made disclosures to its regulators at its own instigation. The nature of these interactions can bewide ranging and, for example, may include 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 andproduct disclosure 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.
In 2021, the Bank self-identified and notified three prescribed transaction reporting (PTR) matters to RBNZ, where transaction reports had not been
filed within the prescribed timeframe. RBNZ has informed the Bank that it considers one of these matters (related to 6,409 transaction reports of acertain SWIFT message type) to be a material breach, and the other two to be minor breaches, of the Anti-Money Laundering and Countering
Financing of Terrorism (AML/CFT) Act 2009 relating to PTR. In April 2023, RBNZ notified the Bank that it had closed its investigations into thesebreaches, and imposed some additional reporting obligations on the Bank, to be provided by no later than 31 October 2023.
LOAN INFORMATION LITIGATIONIn September 2021, representative proceedings were brought against the Bank, alleging breaches of disclosure requirements under consumer credit
legislation in respect of variation letters sent to certain loan customers. The Bank is defending the allegations. The proceedings are still at an earlystage. In July 2022, the High Court ruled that the proceedings shall proceed as an opt-out representative action brought by one representative plaintiff
on behalf of a class, being customers who entered into a home loan or personal loan with the Bank between 6 June 2015 and 28 May 2016 andrequested a variation to that loan during that period. All parties have appealed aspects of that decision.
WARRANTIES AND INDEMNITIESANZBGL New Zealand has provided warranties, indemnities and other commitments in favour of the purchaser in connection with various disposals of
businesses and assets and other transactions, covering a range of matters and risks. It is exposed to potential claims under those warranties,
indemnities and commitments, some of which are currently active. The outcomes and total costs associated with these exposures remain uncertain.

20

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZBGL NEW ZEALAND

LIMITED ASSURANCE REPORTINDEPENDENT AUDITOR’S REVIEW REPORTTO THE DIRECTORS OF AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITEDREPORT ON THE CONSOLIDATED INTERIM FINANCIAL STATEMENTS
CONCLUSION
We have completed a review of the accompanying consolidated interim financial statements of the New Zealand business of Australia and New
Zealand Banking Group Limited (ANZBGL) and its subsidiaries (ANZBGL New Zealand) on pages 4 to 20 which comprise:• the consolidated statement of financial position as at 31 March 2023;• the consolidated statements of comprehensive income, changes in equity and cash flows for the six-month period then ended; and• notes, including a summary of significant accounting policies and other explanatory information.
Based on our review, nothing has come to our attention that causes us to believe that the consolidated interim financial statements have notbeen prepared, in all material respects, in accordance with NZ IAS 34 Interim Financial Reporting (NZ IAS 34) and IAS 34 Interim Financial Reporting(IAS 34).
BASIS FOR CONCLUSION
A review of the consolidated interim financial statements in accordance with NZ SRE 2410 Review of Financial Statements Performed by the Independent
Auditor of the Entity (NZ SRE 2410) is a limited assurance engagement. The auditor performs procedures, consisting of making enquiries, primarily of
persons responsible for financial and accounting matters, and applying analytical and other review procedures.
As the auditor of ANZBGL New Zealand, NZ SRE 2410 requires that we comply with the ethical requirements relevant to the audit of the annual
financial statements.
Our firm has also provided other services to ANZBGL New Zealand in relation to review of regulatory returns, internal controls reports, prospectus
assurance, agreed upon procedures and other assurance engagements. Subject to certain restrictions, partners and employees of our firm may also
deal with ANZBGL New Zealand on normal terms within the ordinary course of trading activities of the business of ANZBGL New Zealand. These
matters have not impaired our independence as reviewer of ANZBGL New Zealand. The firm has no other relationship with, or interest in, ANZBGLNew Zealand.
USE OF THIS INDEPENDENT REVIEW REPORTThis independent review report is made solely to ANZBGL’s directors. Our review work has been undertaken so that we might state to the directors
those matters we are required to state to them in the independent review report and for no other purpose. To the fullest extent permitted by law, we
do not accept or assume responsibility to anyone other than the directors for our review work, this independent review report, or any of the opinions
we have formed.
RESPONSIBILITIES OF THE DIRECTORS FOR THE CONSOLIDATED INTERIM FINANCIAL STATEMENTS
The Directors, on behalf of ANZBGL New Zealand, are responsible for:• the preparation and fair presentation of the consolidated interim financial statements in accordance with NZ IAS 34 and IAS 34;• implementing necessary internal control to enable the preparation of a consolidated interim financial statements that are free from material
misstatement, whether due to fraud or error; and• assessing the ability to continue as a going concern. This includes disclosing, as applicable, matters related to going concern and using thegoing concern basis of accounting unless they either intend to liquidate or to cease operations, or have no realistic alternative but to do so.
AUDITOR’S RESPONSIBILITIES FOR THE REVIEW OF THE CONSOLIDATED INTERIM FINANCIAL STATEMENTS
Our responsibility is to express a conclusion on the consolidated interim financial statements based on our review. We conducted our review inaccordance with NZ SRE 2410. NZ SRE 2410 requires us to conclude whether anything has come to our attention that causes us to believe that theconsolidated interim financial statements are not prepared, in all material respects, in accordance with NZ IAS 34 and IAS 34.
The procedures performed in a review are substantially less than those performed in an audit conducted in accordance with International Standards
on Auditing (New Zealand) and consequently does not enable us to obtain assurance that we might identify in an audit. Accordingly, we do not
express an audit opinion on ANZBGL New Zealand’s consolidated interim financial statements.
The engagement partner on the review resulting in this independent auditor’s review report is Jamie Munro.

KPMG
Auckland8 May 2023
21

REGISTERED BANKDISCLOSURESThis section contains the additional disclosures required by the Registered Bank Disclosure Statements(Overseas Incorporated Registered Banks) Order 2014.

22

Section

Order reference

Page

B1.

General disclosures

Schedule 3

23

B2.

Additional financial disclosures

Schedule 5

24

B3.

Asset quality

Schedule 7

29

B4.

Credit and market risk exposures and capital adequacy

Schedule 9

31

B5.

Insurance business

Schedule 12

31

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZBGL NEW ZEALAND

UNAUDITEDREGISTERED BANK DISCLOSURES
B1. GENERAL DISCLOSURES
Details of the ultimate non-bank holding company
On 3 January 2023, the Ultimate Parent Bank established, by a scheme of arrangement, a non-operating holding company, ANZ Group Holdings
Limited, as the new listed parent holding company of the ANZ Group and implemented a restructure to separate the Overseas Banking Group’sbanking and certain non-banking businesses into the ANZ bank group and ANZ non-bank Group. The ANZ bank group comprises the majority of thebusinesses and subsidiaries that were held in Australia and New Zealand Banking Group Limited prior to the restructure. The ANZ non-bank group
comprises banking-adjacent businesses developed or acquired by the ANZ Group to focus on bringing new technology and banking-adjacentservices to its customers, and a separate service company.
The address for service of the Ultimate Non-Bank Holding Company is ANZ Centre, Melbourne, Level 9, 833 Collins Street, Docklands, Victoria 3008,
Australia.
The Ultimate Parent Bank is unchanged.
Guarantees
No material obligations of the NZ Branch are guaranteed as at 8 May 2023.
Covered bonds issued by ANZ New Zealand (Int’l) Limited, a subsidiary of the Bank, are guaranteed. Refer to page 16 for further details.
Changes in the Ultimate Parent Bank’s Board of Directors
Graeme Liebelt retired as an Independent Non-Executive Director of the Ultimate Parent Bank on 15 December 2022. Graham Hodges was appointed
as an Independent Non-Executive Director of the Ultimate Parent Bank on 8 February 2023. There have been no other changes to the Directors of the
Ultimate Parent Bank since 30 September 2022, the balance date of the last full year disclosure statement.
Auditors
KPMG, 18 Viaduct Harbour Avenue, Auckland, New Zealand.
Pending proceedings or arbitration
A description of any pending legal proceedings or arbitration concerning any member of ANZBGL New Zealand that may have a material adverse
effect on the NZ Branch or ANZBGL New Zealand is included in Note 10 Commitments and contingent liabilities.
Credit rating
The Ultimate Parent Bank has three credit ratings, which are applicable to its long-term senior unsecured obligations that are payable in New Zealandin New Zealand dollars.
As at 8 May 2023, the Ultimate Parent Bank’s credit ratings are:Rating agency
S&P Global Ratings
Fitch Ratings
Moody’s Investors Service

Credit rating
AAA+
Aa3

Qualification
Outlook Stable
Outlook Stable
Outlook Stable

Other material matters
Climate related disclosures
The Financial Sector (Climate-related Disclosures and Other Matters) Amendment Act 2021 amended the Financial Markets Conduct Act 2013 witheffect from 27 October 2022. The amendments will require ANZBGL New Zealand to produce climate statements from the year ending 30 September
2024, in accordance with climate reporting standards issued by the External Reporting Board. ANZBGL New Zealand is actively preparing to produce
climate statements in accordance with this timetable.
Revised RBNZ capital requirements
RBNZ has revised its bank capital adequacy requirements applying to New Zealand locally incorporated registered banks, which are set out in RBNZ’s
Banking Prudential Requirements documents. The new capital adequacy requirements are being implemented in stages during a transition period
from October 2021 to July 2028. The key requirements still being implemented are:
• The Banking Group’s total capital requirement will increase to 18% of RWA, including tier 1 capital of at least 16% of RWA. Up to 2.5% of the tier 1
capital requirement can be made up of additional tier 1 (AT1) capital, with the remainder of the tier 1 requirement made up of common equity
tier 1 (CET1) capital. The increased capital ratios requirements are being progressively implemented until July 2028. AT1 capital must consist of
perpetual preference shares, which may be redeemable. The total capital requirement can also include tier 2 capital of up to 2% of RWA. Tier 2
capital must consist of long-term subordinated debt.
• The tier 1 capital requirement will include a CET1 prudential capital buffer of 9% of RWA. This will include: a 2% domestic systemically importantbank capital buffer; a 1.5% 'early-set' counter-cyclical capital buffer, which can be temporarily reduced to 0% following a financial crisis, or
temporarily increased; and a 5.5% capital conservation buffer.
• Contingent capital instruments will no longer be treated as eligible regulatory capital. As at 31 March 2023, the Bank had NZ$1,238 million of
AT1 instruments that will progressively lose eligible regulatory capital treatment over the transition period to 1 July 2028.
RBNZ’s reforms will result in a material increase in the level of capital that the Banking Group is required to hold. The reforms could have a material
impact on the Banking Group and its business, including on its capital allocation and business planning.
Financial statements of the Ultimate Parent Bank and Overseas Banking Group
Copies of the most recent publicly available financial statements of the Ultimate Parent Bank and Overseas Banking Group will be provided
immediately, free of charge, to any person requesting a copy where request is made at the Registered Office. The most recent publicly available
financial statements for the Ultimate Parent Bank and Overseas Banking Group can also be accessed at the website anz.com/shareholder/centre/.
23

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZBGL NEW ZEALAND

UNAUDITEDREGISTERED BANK DISCLOSURES
B2. ADDITIONAL FINANCIAL DISCLOSURES
Additional information on the balance sheet
As at 31 March 2023
Total interest earning and discount bearing assets
Total interest and discount bearing liabilities
Total amounts due from related entities
Total amounts due to related entities
Total liabilities of the NZ Branch less amounts due to related entities

NZ$m
177,810
144,846
3,971
6,964
16

Assets charged as security for liabilities
The following disclosure excludes the amounts presented as collateral paid and received on the balance sheet that relate to derivative liabilities andderivative assets respectively. The terms and conditions of those collateral agreements are included in the standard Credit Support Annex that forms
part of the International Swaps and Derivatives Association Master Agreement under which most of our derivatives are executed.
Assets charged as security for liabilities include the following types of instruments:• securities provided as collateral for repurchase transactions. These transactions are governed by standard industry agreements;• specified residential mortgages provided as security for notes and bonds issued to investors as part of ANZBGL New Zealand’s covered bondprogrammes; and• collateral provided to the RBNZ under the Term Lending Facility (TLF) and Funding for Lending Programme (FLP).
The carrying amounts of assets pledged as security are as follows:
As at 31 March 2023
Securities sold under agreements to repurchase
Residential mortgages pledged as security for repurchase agreements with RBNZ
Total assets of the ANZNZ Covered Bond Trust pledged as security for covered bonds

NZ$m
980
4,844
9,818

Additional information on the income statement
The amounts of net trading gains or losses and other fair value adjustments are included in Note 2 Other operating income. ANZBGL New Zealanddoes not have any loans and advances designated at fair value through profit or loss. Other operating income for the purposes of the Order comprises
net fee and commission income, and all other items of other income (all in Note 2 Other operating income).

24

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZBGL NEW ZEALAND

UNAUDITED

Additional information on concentrations of credit risk
Analysis of financial assets by industry is based on Australian and New Zealand Standard Industrial Classification (ANZSIC) codes. The significant
categories shown are the level one New Zealand Standard Industry Output Categories (NZSIOC), except that Agriculture is shown separately as
required by the Order.
Composition of financial instruments that give rise to credit risk by industry group are presented below:
Loans andadvances
NZ$m

Other
financialassets
NZ$m

Off-balance
sheet credit
relatedcommitments
NZ$m

Total
NZ$m

15,422
585
195
2,711
804
1,246
1,628
2,737
900
920
38,133
904
212
1,063
77,010
1,123

64
4
10
140
234
6
51
19
49
14,246
2,024
8
9,496
23
314
91

991
122
257
1,925
1,400
932
1,712
748
749
1,447
2,140
448
806
396
13,516
1,120

16,477
711
462
4,776
2,438
2,184
3,391
3,504
1,698
16,61342,297
1,360
10,514
1,482
90,8402,334

Subtotal
Overseas
Finance and insurance services
Households
All other non-residents

145,593

26,77928,709201,081

151
1,435
605

10,798626

272-

11,221
1,441
631

Subtotal
Gross subtotal
Allowance for ECL
Subtotal
Unearned income
Capitalised brokerage and other origination costs
Maximum exposure to credit risk

2,191
147,784(750)
147,034(32)
421
147,423

10,83037,60937,60937,609272
28,981(110)
28,871
28,871

13,293
214,374(860)
213,514(32)
421
213,903

As at 31 March 2023
New Zealand residents
Agriculture
Forestry and fishing, agriculture services
MiningManufacturing
Electricity, gas, water and waste services
Construction
Wholesale trade
Retail trade and accommodation
Transport, postal and warehousing
Finance and insurance services
Rental, hiring & real estate services
Professional, scientific, technical, administrative and support services
Public administration and safety
Health care and social assistance
Households
Other1

1

Other includes exposures to information media and telecommunications, education and training; arts and recreation services; and other services.

25

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZBGL NEW ZEALAND

UNAUDITEDREGISTERED BANK DISCLOSURES
Additional information on concentrations of funding
Analysis of funding liabilities by industry is based on ANZSIC codes. The significant categories shown are the level one NZSIOC.
As at 31 March 2023

Note

NZ$m

6

130,298

Funding composition
Customer deposits
Wholesale funding
Debt issuances

18,033

Certificates of deposit and commercial paper

4,258

Other borrowings

7,564

Total wholesale funding

29,855

Total deposits and wholesale funding

160,153

Customer deposits by industry - New Zealand residents
Agriculture, forestry and fishing
Mining4,406
236

Manufacturing

2,701

Construction

2,893

Wholesale trade

2,507

Retail trade and accommodation

2,215

Transport, postal and warehousing

1,709

Financial and insurance services

13,237

Rental, hiring and real estate services

3,674

Professional, scientific, technical, administrative and support services

6,881

Public administration and safety

1,521

Health care and social assistance

1,354

Arts, recreation and other services

2,267Households

72,365

Other1

2,714

Subtotal

120,680

Customer deposits by industry - overseas
Households
All other non-residents
Subtotal
Total customer deposits

8,830
788
9,618
130,298

Wholesale funding (financial and insurance services industry)
New Zealand

8,049

Overseas21,806

Total wholesale funding

29,855

Total deposits and wholesale funding

160,153

Concentrations of funding by geography
New Zealand

128,729

Australia

3,638

United States

10,877

Europe10,050

Other countries

6,859

Total deposits and wholesale funding
1

26

Other includes electricity, gas, water and waste services; information media and telecommunications; and education and training.

160,153

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZBGL NEW ZEALAND

UNAUDITED

Additional information on interest rate sensitivity
The following table represents the interest rate sensitivity of ANZBGL New Zealand's assets, liabilities and off-balance sheet instruments by showing
the periods in which these instruments may reprice, that is, when interest rates applicable to each asset or liability can be changed.

As at 31 March 2023
AssetsCash and cash equivalents
Settlement balances receivable
Collateral paid
Trading securities
Derivative financial instruments
Investment securities
Net loans and advances
Other financial assets
Total financial assets
Liabilities
Settlement balances payable
Collateral received
Deposits and other borrowings
Derivative financial instruments
Debt issuances
Lease liabilities
Other financial liabilities
Total financial liabilities
Hedging instruments
Interest sensitivity gap
1

Total
NZ$m

Up to
3 months
NZ$m

Over 3 to
6 months
NZ$m

Over 6 to
12 months
NZ$m

Over 1 to
2 years
NZ$m

Over
2 years
NZ$m

Not bearing
interest1
NZ$m

12,657
516
576
5,657
6,339
11,211
147,423836
185,215

12,282
576
1,088
202
62,89977,047208
397
16,51017,11560
479
26,68527,224292
306
31,86332,461

4,009
9,826
10,12823,963

375
516
6,339
1
(662)
836
7,405

3,375
1,056
142,120
6,271
18,033
207
1,488
172,550
12,665

1,963
1,056
87,9851,275
12801
93,092
6,961(9,084)

14,8832,048
11
16,942
6,742
6,915

14,2923,226
23
17,541
1,173
10,856

2,692
1,874
43
4,609
(18,076)
9,776

2,934
9,610
118
12,662
3,200
14,501

1,412
19,3346,271
687
27,704(20,299)

Excludes non-coupon bearing discount financial assets and financial liabilities which are shown as repricing on their maturity date.

Additional information on liquidity risk
Maturity analysis of financial liabilities
The table below provides residual contractual maturity analysis of financial liabilities at 31 March 2023 within relevant maturity groupings. All
outstanding debt issuances are profiled on the earliest date on which ANZBGL New Zealand may be required to pay. The amounts represent principal
and interest cash flows – so they may differ from equivalent amounts reported on the balance sheet.

As at 31 March 2023

On
demand
NZ$m

Settlement balances payable
Collateral received
Deposits and other borrowings

Less than
3 months
NZ$m

3 to 12months
NZ$m

1 to 5
years
NZ$m

After
5 years
NZ$m

Total
NZ$m

2,702

727

-

-

-

3,429

-

1,056

-

-

-

1,056

79,471

23,56230,827

10,793-

144,653

Derivative financial liabilities (trading)

-

6,114

-

-

-

6,114

Debt issuances

-

609

5,948

11,5992,211

20,367

Lease liabilities

-

13

38

143

30

224

Other financial liabilities

-

76

24

647

449

1,196

- gross inflows

-

1,769

5,943

7,852

838

16,402- gross outflows-(1,742)(5,929)(8,154)(888)(16,713)

1

Derivative financial instruments(balance sheet management)

1

Any callable wholesale debt instruments have been included at their next call date.

At 31 March 2023, NZ$28,981 million of its credit related commitments and contingent liabilities mature in less than 1 year, based on the earliest dateon which ANZBGL New Zealand may be required to pay.

27

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZBGL NEW ZEALAND

UNAUDITEDREGISTERED BANK DISCLOSURES
Liquidity portfolio management
ANZBGL New Zealand holds a diversified portfolio of cash and high quality liquid securities primarily to support liquidity risk management. The size of
ANZBGL New Zealand’s liquidity portfolio is determined with consideration of the amount required to meet the requirements of its internal andregulatory liquidity scenario metrics.
As at 31 March 2023
Central and local government bonds
Government treasury bills
Certificates of deposit
Other bonds
Securities eligible to be accepted as collateral in repurchase transactions
Cash and balances with central banks
Total liquidity portfolio

NZ$m
7,130
1,462
275
7,517
16,384
10,94927,333

Assets held in ANZBGL New Zealand’s liquidity portfolio are all denominated in New Zealand dollars and include balances held with RBNZ andsecurities issued by the New Zealand Government, supranational agencies, highly rated banks state owned enterprises, local authorities (including
through a funding authority) and highly rated corporates.
The Bank also held unencumbered internal residential mortgage backed securities (RMBS) which would be accepted as collateral by RBNZ in
repurchase transactions. These holdings would entitle the Bank to enter into repurchase transactions with RBNZ with a value of NZ$10,613 million at
31 March 2023.
RBNZ Term Lending Facility (TLF) and Funding for Lending Programme (FLP)• Between May 2020 and July 2021, RBNZ made funds available under the TLF to promote lending to businesses. The TLF is a five-year secured
funding facility for New Zealand banks at a fixed rate of 0.25%.
•

Between November 2020 and December 2022, RBNZ made funds available under the FLP to lower the cost of borrowing for New Zealandbusinesses and households. The FLP is a three-year secured funding facility for New Zealand banks at a floating rate of the New Zealand Official
Cash Rate (OCR).

As at 31 March 2023, the Bank had drawn NZ$300 million under the TLF and NZ$3,500 million under the FLP. These amounts are included in securities
sold under repurchase agreements in Note 6 Deposits and other borrowings.
Overseas Banking Group Profitability and Size
31 Mar 23
3,582
0.66%
1,111,605
9.26%

Net profit for the six months ended 31 March 2023 (AUDm)
Net profit after tax for the 12 months ended 31 March 2023 as a percentage of average total assets
Total assets (AUDm)
Percentage change in total assets in the 12 months to 31 March 2023
Reconciliation of mortgage related amounts
As at 31 March 2023
Term loans - housing1
Less: housing loans made to corporate customers
On-balance sheet residential mortgage exposures subject to the IRB approach (per asset quality and LVR analysis)
Add: off-balance sheet residential mortgage exposures subject to the IRB approach (per asset quality and LVR analysis)
Total residential mortgage exposures subject to the IRB approach (per LVR analysis)
128Term loans – housing includes loans secured over residential property for owner-occupier, residential property investment and business purposes.

Note
4
B4
B4
B4

NZ$m
104,593(1,307)103,286
9,273
112,559

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZBGL NEW ZEALAND

UNAUDITED

B3. ASSET QUALITY
This section should be read in conjunction with the estimates, assumptions and judgements included in Note 1 About our interim financial
statements, Note 5 Allowance for expected credit losses and Note 8 Credit risk.
Movements in components of loss allowance – total

Net loans and advances - total
As at 1 October 2022
Transfer between stages
New and increased provisions (net of collective provision releases)
Write-backs
Recoveries of amounts previously written off
Credit impairment charge / (release)
Bad debts written-off (excluding recoveries)
Add back recoveries of amounts previously written off
Discount unwind
As at 31 March 2023
Off-balance sheet credit related commitments - total
As at 1 October 2022
Transfer between stages
New and increased provisions (net of collective provision releases)
Credit impairment charge

Stage 1
NZ$m
199
19
(24)
(5)
194

Stage 3
Collectively IndividuallyStage 2
assessedassessed
NZ$m
NZ$m
NZ$m
311
59
77
(20)
1
107
10
37
(9)
(5)
87
11
23
(16)
5
(1)
398
70
88

Total
NZ$m
646
130
(9)
(5)
116
(16)
5
(1)
750

66
2
-

31
(2)
5

3
-

5
-

105
5

2
68

3
34

3

5

5
110

Gross loans and advances - total
As at 1 October 2022
Net transfers in to each stage
Amounts drawn from new or existing facilities
Additions
Net transfers out of each stage
Amounts repaid
Deletions
Amounts written off
As at 31 March 2023
Loss allowance as at 31 March 2023

139,972
22,55622,556(4,309)(21,861)(26,170)
136,358
194

6,910
4,112
718
4,830
(1,113)(1,113)
10,627
398

590
180
26
206
(145)
(145)
651
70

146
17
53
70
(52)
(52)
(16)
148
88

147,618
4,309
23,353
27,662(4,309)(23,171)(27,480)(16)
147,784
750

Off-balance sheet credit related commitments - total
As at 1 October 2022
Net transfers in to each stage
New and increased facilities and drawn amounts repaid
Additions
Net transfers out of each stage
Reduced facilities and amounts drawn
Deletions
As at 31 March 2023
Loss allowance as at 31 March 2023

29,027
6,023
6,023
(56)
(6,985)(7,041)
28,009
68

995
53
180
233
(274)
(274)
954
34

14
3
3
6
(7)
(7)
13
3

6
15
15
(16)
(16)
5
5

30,042
56
6,221
6,277
(56)
(7,282)(7,338)28,981110

As at 31 March 2023
Impacts of changes in gross financial assets on loss allowances

Explanation of how changes in the gross carrying amounts of gross loans and advances contributed to changes in loss allowance
Overall, loss allowances are 0.49% of gross balances as at 31 March 2023, up from 0.42% as at 30 September 2022. The NZ$109 million (14.5%) increasein loss allowances was driven by an increase in the proportion of gross balances in Stage 2, partially offset by changes in the forward-looking
economic scenarios as described in Note 5 Allowance for expected credit losses.

29

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZBGL NEW ZEALAND

UNAUDITEDREGISTERED BANK DISCLOSURES
Past due assets and other asset quality information
Total
NZ$m

As at 31 March 2023
Past due assets
Less than 30 days past due
At least 30 days but less than 60 days past due
At least 60 days but less than 90 days past due
At least 90 days past due
Total past due but not individually impaired

1,056
570
166
502
2,294

Other asset quality information
Undrawn facilities with individually impaired customers
Other assets under administration

5
4

ANZBGL New Zealand does not have any loans and advances designated at fair value.
Overseas Banking Group asset quality
As at
Individually impaired assets (AUDm)1
Individually impaired assets as a percentage of total assets
Individual credit impairment allowance (AUDm)
Individual credit impairment allowance as a percentage of individually impaired assets1
Collective credit impairment allowance (AUDm)
1

30

31 Mar 23
828
0.1%
421
50.8%
4,040

30 Sep 22
1,062
0.1%
542
51.0%
3,853

Comparative amounts have been updated to exclude restructured items of A$376 million and other defaulted financial assets of A$7 million that are not individually assessed for credit
impairment. Restructured items are facilities where the original contractual terms have been modified for reasons related to the financial difficulties of the customer and are collectively
assessed for stage 3 ECL.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZBGL NEW ZEALAND

UNAUDITED

B4. CREDIT AND MARKET RISK EXPOSURES AND CAPITAL ADEQUACYAPRA Basel III capital ratios

As at 31 March
Common equity tier 1 capital
Tier 1 capital
Total capital

Ultimate Parent Bank
Overseas Banking Group (Extended Licensed Entity)
2023
2022
2023
2022
11.5%
11.1%
13.2%
12.9%
13.2%
13.1%
15.1%
15.2%
16.6%
17.1%
20.6%
21.6%

The Ultimate Parent Bank and the Overseas Banking Group are required to hold minimum capital as determined by APRA’s capital framework, which is
at least equal to that specified under the internationally agreed Basel III framework.
APRA has authorised the Ultimate Parent Bank and the Overseas Banking Group to use:
• the Internal Ratings Based (IRB) methodology for calculation of credit risk weighted assets. Where the Overseas Banking Group is not accredited
to use the IRB methodology the Overseas Banking Group applies the standardised approach.
• the Standardised Measurement Approach (SMA) for the operational risk weighted asset equivalent.
The Overseas Banking Group exceeded the minimum capital requirements set by APRA as at 31 March 2023 and for the comparative prior periods.
The Overseas Banking Group is required to publicly disclose Pillar 3 financial information as at 31 March 2023. The Overseas Banking Group’s Pillar 3
disclosure document for the quarter ended 31 March 2023, in accordance with APS 330: Public Disclosure of Prudential Information, discloses capital
adequacy ratios and other prudential information. This document can be accessed at the website anz.com.
Market risk
ANZBGL New Zealand’s aggregate market risk exposures below have been calculated in accordance with the RBNZ document BPR140: Market Risk.
The peak end-of-day market risk exposures are for the six months ended 31 March 2023.

As at 31 March 2023
Interest rate risk
Foreign currency risk
Equity risk

Implied risk weighted
exposure
Period end
Peak
NZ$m
NZ$m
5,362
6,400
39
95
1
1

Notional capital charge
Period end
Peak
NZ$m
NZ$m
429
512
3
8
-

Additional mortgage information
As required by RBNZ, LVRs are calculated as the current exposure secured by a residential mortgage divided by ANZBGL New Zealand's valuation of
the security property at origination of the exposure. Off-balance sheet exposures include undrawn and partially drawn residential mortgage loans aswell as commitments to lend. Commitments to lend are formal offers for housing lending which have been accepted by the customer.

As at 31 March 2023
LVR range
Does not exceed 60%
Exceeds 60% and not 70%
Exceeds 70% and not 80%
Does not exceed 80%
Exceeds 80% and not 90%
Exceeds 90%
Total

On-balance Off-balance
sheet
sheet
NZ$m
NZ$m
57,215
19,59420,04796,856
4,794
1,636
103,286

6,983
1,034
964
8,981
112
180
9,273

Total
NZ$m
64,198
20,62821,011
105,837
4,906
1,816
112,559

B5. INSURANCE BUSINESSAs at 31 March 2023, ANZBGL New Zealand does not conduct any insurance business.

31

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZBGL NEW ZEALANDDIRECTORS' AND NEW ZEALAND CHIEF EXECUTIVE OFFICER'S STATEMENT
As at the date on which this Disclosure Statement is signed, after due enquiry, each Director of the Ultimate Parent Bank and the Chief Executive
Officer – NZ Branch believes that:•

The Disclosure Statement contains all the information that is required by the Registered Bank Disclosure Statements (Overseas Incorporated
Registered Banks) Order 2014; and•The Disclosure Statement is not false or misleading.

Over the six months ended 31 March 2023, after due enquiry, each Director of the Ultimate Parent Bank and the Chief Executive Officer – NZ Branchbelieves that:•

The Ultimate Parent Bank has complied in all material respects with each condition of registration that applied during that period1; and•The NZ Branch and the Bank had systems in place to monitor and control adequately the material risks of Relevant Members of ANZBGL New
Zealand including credit risk, concentration of credit risk, interest rate risk, currency risk, equity risk, liquidity risk and other business risks, and thatthose systems were being properly applied.

1.

In accordance with the Order, Ultimate Parent Bank has complied in all material respects with each of its conditions of registration that applied during the period if the RBNZ has not
published any information about a breach on its website, and has not notified Ultimate Parent Bank of any material breach.

Signed by the Chief Executive Officer – NZ Branch

Chris O‘Neale
Chief Executive Officer – NZ Branch
8 May 2023
Signed on behalf of all the Directors of the Ultimate Parent Bank

Antonia Watson
Responsible Person
8 May 2023
on behalf of the Directors of the Ultimate Parent Bank:
Ilana Atlas, AO
Shayne ElliottJane Halton, AO PSM
Graham Hodges
Rt Hon Sir John Key, GNZM ACJohn Macfarlane
Christine O’Reilly
Paul O’Sullivan
Jeff Smith

32

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZBGL NEW ZEALAND

LIMITED ASSURANCE REPORTS

INDEPENDENT AUDITOR’S REPORTS ON THE REGISTERED BANK DISCLOSURESTO THE DIRECTORS OF AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITEDREVIEW REPORT ON THE REGISTERED BANK DISCLOSURES IN SECTIONS B2, B3 AND B5
CONCLUSION
We have completed a review of the accompanying registered bank disclosures of the New Zealand business of Australia and New Zealand
Banking Group Limited (ANZBGL) and its subsidiaries (ANZBGL New Zealand) in sections B2, B3 and B5 on pages 24 to 31. These comprise theinformation that is required to be disclosed in accordance with schedules 5, 7, 12 and 14 of the Registered Bank Disclosure Statements (Overseas
Incorporated Registered Banks) Order 2014 (the Order).
Based on our review, nothing has come to our attention that causes us to believe that the registered bank disclosures in sections B2, B3 and B5:• do not present fairly, in all material respects, the matters to which they relate; or• are not disclosed, in all material respects, in accordance with schedules 5, 7, 12 and 14 of the Order.

BASIS FOR CONCLUSION
A review of the registered bank disclosures in sections B2, B3 and B5 in accordance with NZ SRE 2410 Review of Financial Statements Performed by the
Independent Auditor of the Entity (NZ SRE 2410) is a limited assurance engagement. The auditor performs procedures, consisting of making enquiries,
primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures.
As the auditor of ANZBGL New Zealand, NZ SRE 2410 requires that we comply with the ethical requirements relevant to the audit of the annual
financial statements.
Our firm has also provided other services to ANZBGL New Zealand in relation to review of regulatory returns, internal controls reports, prospectus
assurance, agreed upon procedures and other assurance engagements. Subject to certain restrictions, partners and employees of our firm may also
deal with ANZBGL New Zealand on normal terms within the ordinary course of trading activities of the business of ANZBGL New Zealand. These
matters have not impaired our independence as reviewer of ANZBGL New Zealand. The firm has no other relationship with, or interest in, ANZBGLNew Zealand.
USE OF THIS INDEPENDENT REVIEW REPORTThis independent review report is made solely to ANZBGL’s directors. Our review work has been undertaken so that we might state to the directors
those matters we are required to state to them in the independent review report and for no other purpose. To the fullest extent permitted by law, we
do not accept or assume responsibility to anyone other than the directors for our review work, this independent review report, or any of the opinions
we have formed.
RESPONSIBILITIES OF THE DIRECTORS FOR THE REGISTERED BANK DISCLOSURES IN SECTIONS B1, B2, B3 AND B5The Directors, on behalf of ANZBGL New Zealand, are responsible for:• the preparation and fair presentation of the registered bank disclosures in accordance with schedules 3, 5, 7, 12 and 14 of the Order; and• implementing necessary internal control to enable the preparation of registered bank disclosures that free from material misstatement, whether
due to fraud or error.
AUDITOR’S RESPONSIBILITIES FOR THE REVIEW OF THE REGISTERED BANK DISCLOSURES IN SECTIONS B2, B3
AND B5
Our responsibility is to express a conclusion on the registered bank disclosures in sections B2, B3 and B5 based on our review. We conducted ourreview in accordance with NZ SRE 2410. NZ SRE 2410 requires us to conclude whether anything has come to our attention that causes us to believethat the registered bank disclosures in sections B2, B3 and B5:• do not present fairly, in all material respects, the matters to which they relate; or• are not disclosed, in all material respects, in accordance with schedules 5, 7, 12 and 14 of the Order; or• if applicable, have not been prepared, in all material respects, in accordance with any conditions of registration relating to disclosure
requirements, imposed under section 74(4)(c) of the Banking (Prudential Supervision) Act 1989 (ANZBGL does not have any such conditions).
The procedures performed in a review are substantially less than those performed in an audit conducted in accordance with International Standards
on Auditing (New Zealand) and consequently does not enable us to obtain assurance that we might identify in an audit. Accordingly, we do not
express an audit opinion on the registered bank disclosures in sections B2, B3 and B5.

KPMG
Auckland8 May 2023
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AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZBGL NEW ZEALAND

LIMITED ASSURANCE REPORTS
LIMITED ASSURANCE REPORT ON THE CREDIT AND MARKET RISK EXPOSURES AND CAPITAL ADEQUACYDISCLOSURES IN SECTION B4
CONCLUSION
We have reviewed the credit and market risk exposures and capital adequacy disclosures in section B4 on page 31 (the Capital Adequacy
Disclosures), which comprise the information that is required to be disclosed in accordance with schedule 9 of the Order.
Based on our limited assurance conclusion, which is not a reasonable assurance engagement or audit, nothing has come to our attention thatwould lead us to believe that the Capital Adequacy Disclosures are not, in all material respects disclosed in accordance with schedule 9 of the Order.

STANDARDS WE FOLLOWED
We conducted our limited assurance engagement in accordance with International Standard on Assurance Engagements (New Zealand) 3000
(Revised) Assurance Engagements other than audits or reviews of historical financial information and Standard on Assurance Engagements 3100
(Revised) Assurance Engagements on Compliance. We believe that the evidence we have obtained is sufficient and appropriate to provide a basis forour conclusion. In accordance with those standards we:• used our professional judgement to plan and perform the engagement to obtain limited assurance that the Capital Adequacy Disclosures are freefrom material misstatement and non-compliance, whether due to fraud or error;• considered relevant internal controls when designing our assurance procedures, however we do not express a conclusion on the effectiveness ofthese controls; and• ensured that the engagement team possess the appropriate knowledge, skills and professional competencies.
HOW TO INTERPRET LIMITED ASSURANCE AND MATERIAL MISSTATEMENT AND NON-COMPLIANCE
In a limited assurance engagement, the assurance practitioner performs procedures, primarily consisting of discussion and enquiries ofmanagement and others within the entity, as appropriate, and observation and walk-throughs, and evaluates the evidence obtained. The
procedures selected depend on our judgement, including identifying areas where the risk of material misstatement and non-compliance withschedule 9 of the Order is likely to arise.
The procedures performed in a limited assurance engagement vary in nature and timing from and are less in extent than for a reasonable assurance
engagement. Consequently, the level of assurance obtained in a limited assurance engagement is substantially lower than the assurance that would
have been obtained had a reasonable assurance engagement been performed.
Misstatements, including omissions, within the Capital Adequacy Disclosures and non-compliance are considered material if, individually or in theaggregate, they could reasonably be expected to influence the relevant decisions of the intended users taken on the basis of the Capital Adequacy
Disclosures.
INHERENT LIMITATIONS
Because of the inherent limitations of an assurance engagement, together with the internal control structure it is possible that fraud, error or noncompliance with compliance requirements may occur and not be detected.
USE OF THIS INDEPENDENT LIMITED ASSURANCE REPORTThis independent limited assurance report is made solely to ANZBGL’s directors. Our assurance work has been undertaken so that we might state to
the directors those matters we are required to state to them in the assurance report and for no other purpose. To the fullest extent permitted by law,
we do not accept or assume any responsibility to anyone other than the directors for our assurance work, for this independent limited assurance
report, and/or for any of the conclusions we have reached.
DIRECTOR’S RESPONSIBILITY FOR THE CAPITAL ADEQUACY DISCLOSURESThe Directors are responsible for the preparation of the Capital Adequacy Disclosures that are required to be disclosed in accordance withschedule 9 of the Order, which the Directors have determined to meet the needs of the recipients. This responsibility includes such internal control
as the Directors determine is necessary to enable the preparation of the Capital Adequacy Disclosures that are free from material misstatement andnon-compliance whether due to fraud or error.
OUR RESPONSIBILITY FOR THE CAPITAL ADEQUACY DISCLOSURESOur responsibility is to express a conclusion on whether anything has come to our attention that the Capital Adequacy Disclosures have not, in allmaterial respects, been disclosed in accordance with schedule 9 of the Order for the six-month period ended 31 March 2023.

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AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZBGL NEW ZEALAND

LIMITED ASSURANCE REPORTS

OUR INDEPENDENCE AND QUALITY CONTROL
We have complied with the independence and other ethical requirements of Professional and Ethical Standard 1 International Code of Ethics for
Assurance Practitioners (Including International Independence Standards) (New Zealand) issued by the New Zealand Auditing and Assurance Standards
Board, which is founded on fundamental principles of integrity, objectivity, professional competence and due care, confidentiality and professional
behaviour.
The firm applies Professional and Ethical Standard 3 Quality Management for Firms that Perform Audits or Reviews of Financial Statements, or Other
Assurance or Related Services Engagements and accordingly maintains a comprehensive system of quality control including documented policies andprocedures regarding compliance with ethical requirements, professional standards and applicable legal and regulatory requirements.
Our firm has also provided other services to ANZBGL New Zealand in relation to review of regulatory returns, internal controls reports, prospectus
assurance, agreed upon procedures and other assurance engagements. Subject to certain restrictions, partners and employees of our firm may also
deal with ANZBGL New Zealand on normal terms within the ordinary course of trading activities of the business of ANZBGL New Zealand. These
matters have not impaired our independence as assurance providers of ANZBGL New Zealand for this engagement. The firm has no other relationshipwith, or interest in, ANZBGL New Zealand.

KPMG
Auckland8 May 2023

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