# EDGAR Filing Document

**Accession Number:** 0000719245
**File Stem:** 0001104659-23-022959
**Filing Date:** 2023-2
**Character Count:** 54035
**Document Hash:** 9c2bf56ae00f691bc5deacbda842ce4e
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001104659-23-022959.hdr.sgml**: 20230217

**ACCESSION NUMBER**: 0001104659-23-022959

**CONFORMED SUBMISSION TYPE**: 6-K

**PUBLIC DOCUMENT COUNT**: 25

**CONFORMED PERIOD OF REPORT**: 20230217

**FILED AS OF DATE**: 20230217

**DATE AS OF CHANGE**: 20230216

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** WESTPAC BANKING CORP
- **CENTRAL INDEX KEY:** 0000719245
- **STANDARD INDUSTRIAL CLASSIFICATION:** COMMERCIAL BANKS, NEC [6029]
- **IRS NUMBER:** 986008211
- **STATE OF INCORPORATION:** C3
- **FISCAL YEAR END:** 0930

**FILING VALUES:**
- **FORM TYPE:** 6-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-10167
- **FILM NUMBER:** 23639944

**BUSINESS ADDRESS:**
- **STREET 1:** LEVEL 18, 275 KENT STREET
- **CITY:** SYDNEY
- **STATE:** C3
- **ZIP:** 2000
- **BUSINESS PHONE:** 0011-61466382161

**MAIL ADDRESS:**
- **STREET 1:** LEVEL 18, 275 KENT STREET
- **CITY:** SYDNEY
- **STATE:** C3
- **ZIP:** 2000

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934

**February 17, 2023**

**Commission File Number 1-10167**

<u>WESTPAC BANKING CORPORATION</u>

(Translation of registrant's name into English)

<u>275 KENT STREET, SYDNEY, NEW SOUTH WALES 2000, AUSTRALIA</u>

(Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports

under cover of Form 20-F or Form 40-F.

Form 20-F ⌧ Form 40-F ◻

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ◻

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ◻

**<u>Incorporation by Reference</u>**

The information contained in Exhibit 1 to this Report on Form 6-K shall be incorporated by reference in the prospectuses relating to the Registrant's securities contained in the Registrant's Registration Statements on Form F-3 (File Nos. [333-260702](https://www.sec.gov/Archives/edgar/data/719245/000110465921133384/tm2131442-1_f3.htm) and [333-260703](https://www.sec.gov/Archives/edgar/data/719245/000110465921133385/tm2131451-1_f3asr.htm)), as such prospectuses may be amended or supplemented from time to time.

**<u>Index to Exhibits</u>**

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| **Exhibit<br> No.** | **Description** |
| &nbsp;&nbsp;&nbsp;[1](tm237085d1_ex1.htm) | [Westpac Group December 2022 Pillar 3 Report](tm237085d1_ex1.htm) |

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**Disclosure regarding forward-looking statements**

The information contained in this Report on Form 6-K contains statements that constitute "forward-looking statements" within the meaning of section 21E of the U.S. Securities Exchange Act of 1934.

Forward-looking statements are statements about matters that are not historical facts. Forward-looking statements appear in a number of places in this Report and include statements regarding our intent, belief or current expectations with respect to our business and operations, macro and micro economic and market conditions, results of operations and financial condition, capital adequacy and risk management, including, without limitation, future loan loss provisions and financial support to certain borrowers, forecasted economic indicators and performance metric outcomes, indicative drivers, climate- and other sustainability-related statements, commitments, targets, projections and metrics, and other estimated and proxy data.

We use words such as 'will', 'may', 'expect', 'intend', 'seek', 'would', 'should', 'could', 'continue', 'plan', 'estimate', 'anticipate', 'believe', 'probability', 'indicative', 'risk', 'aim', 'outlook', 'forecast', 'f'cast', 'f', 'assumption', 'projection', 'target', 'goal', 'guidance', 'ambition', or other similar words to identify forward-looking statements, or otherwise identify forward-looking statements. These forward-looking statements reflect our current views on future events and are subject to change, certain known and unknown risks, uncertainties and assumptions and other factors which are, in many instances, beyond our control (and the control of our officers, employees, agents and advisors), and have been made based on management's expectations or beliefs concerning future developments and their potential effect upon us. Forward-looking statements may also be made, verbally or in writing, by members of Westpac's management or Board in connection with this Report. Such statements are subject to the same limitations, uncertainties, assumptions and disclaimers set out in this Report.

There can be no assurance that future developments or performance will align with our expectations or that the effect of future developments on us will be those anticipated. Actual results could differ materially from those we expect or which are expressed or implied in forward-looking statements, depending on various factors including, but not limited to, those described in the section titled 'Risk factors' under the section 'Risk and risk management' in Westpac's 2022 Annual Report on Form 20-F filed with the U.S. Securities and Exchange Commission. When relying on forward-looking statements to make decisions with respect to us, investors and others should carefully consider such factors and other uncertainties and events.

Except as required by law, we assume no obligation to revise or update any forward-looking statements contained in this Report, whether from new information, future events, conditions or otherwise, after the date of this Report.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

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|:---|:---|:---|
|  | <u>WESTPAC BANKING CORPORATION</u> | <u>WESTPAC BANKING CORPORATION</u> |
|  | (Registrant) | (Registrant) |
| Date: February 17, 2023 | By: | /s/ Yvette Adiguzel |
|  |  | Yvette Adiguzel |
|  |  | Tier One Attorney |

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## Ex-1

**Exhibit 1**

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| &nbsp;&nbsp;![GRAPHIC](tm237085d1_ex1img001.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ASX Release 17 February 2023 Pillar 3 Report as at 31 December 2022 Westpac Banking Corporation ("Westpac") today provides the attached Pillar 3 Report (December 2022). For further information: Hayden Cooper Justin McCarthy Group Head of Media Relations General Manager Investor Relations 0402 393 619 0422 800 321 This document has been authorised for release by Tim Hartin, Company Secretary. Level 18, 275 Kent Street Sydney, NSW, 2000  |

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| &nbsp;&nbsp;![GRAPHIC](tm237085d1_ex1img002.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;DECEMBER 2022 INCORPORATING THE REQUIREMENTS OF APS330 WESTPAC BANKING CORPORATION ABN 33 007 457 141 Pillar 3 Report |

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| &nbsp;&nbsp;![GRAPHIC](tm237085d1_ex1img003.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pillar 3 report Table of contents 2 \| Westpac Group December 2022 Pillar 3 Report Structure of Pillar 3 report Executive summary 3 Introduction 5 Group structure 6 Capital overview 8 Leverage ratio 12 Credit risk exposures 13 Securitisation 17 Liquidity coverage ratio 20 Appendix Appendix I \| APS330 Quantitative requirements 21 Disclosure regarding forward-looking statements 22 In this report references to 'Westpac', 'Westpac Group', 'the Group', 'we', 'us' and 'our' are to Westpac Banking Corporation and its controlled entities (unless the context indicates otherwise). In this report, unless otherwise stated or the context otherwise requires, references to '$', 'AUD' or 'A$' are to Australian dollars. Any discrepancies between totals and sums of components in tables contained in this report are due to rounding. In this report, unless otherwise stated, disclosures reflect the Australian Prudential Regulation Authority's (APRA) implementation of Basel III. Information contained in or accessible through the websites mentioned in this report does not form part of this report unless we specifically state that it is incorporated by reference and forms part of this report. All references in this report to websites are inactive textual references and are for information only.  |

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| &nbsp;&nbsp;![GRAPHIC](tm237085d1_ex1img004.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pillar 3 report Executive summary Westpac Group December 2022 Pillar 3 Report \| 3 Key capital ratios Westpac's Level 2 common equity Tier 1 (CET1) capital ratio was 11.13% at 31 December 2022. The CET1 capital ratio was lower than the CET1 capital ratio of 11.29% at 30 September 2022 due to payment of the 2022 final dividend net of the issue of shares under the dividend reinvestment plan (DRP), an increase in total Risk Weighted Assets (RWA) and higher deductions. These impacts were partly offset by the contribution of earnings over the quarter. Loan losses over the quarter were $51 million and included the recovery of a previously written off loan of $40m within Corporates. Gross Corporate loan losses over the quarter were $3 million. Risk Weighted Assets Total RWA increased $2.8 billion or 0.6% over the quarter from both higher credit RWA and non-credit RWA. Credit RWA increased by $1.8 billion and included: A $4.1 billion increase from higher lending across residential mortgages, specialised lending and corporates; A $1.6 billion increase from foreign currency translation impacts mostly from the depreciation of the A$ against the NZ$; A $2.8 billion decrease associated with derivative exposures (counterparty credit risk and mark-to-market related credit risk) primarily due to decreases in the mark-to-market value of derivatives from lower foreign currency translation effects; and A $1.1 billion decrease from improved credit quality mainly within Corporates and the impact of a revised rating model for business lending. Non-credit RWA were $1.0 billion higher over the quarter. This was mainly from: A $1.3 billion increase in Market RWA from portfolio movements; A $1.1 billion increase in Interest Rate Risk in the Banking Book (IRRBB) RWA, mainly from the underlying portfolio which has impacted the repricing and yield curve risk component of the IRRBB calculation, while regulatory embedded loss was lower; and A $2.1 billion decrease in Operational RWA from APRA's revised annual Standardised Measurement Approach (SMA)1 .. This was mainly driven by lower operational losses. 1 Westpac adopted the Standardised Measurement Approach to calculate operational risk capital from 1 January 2022. Under the revised standard operational risk is calculated annually based on annual audited financial statements resulting in a change from 30 September 2022. % 31 December 2022 30 September 2022 31 December 2021 Level 2 Regulatory capital structure Common equity Tier 1 capital ratio 11.13 11.29 12.20 Additional Tier 1 capital ratio 2.10 2.07 2.17 Tier 1 capital ratio 13.39 13.20 14.37 Tier 2 capital ratio 5.01 4.90 4.83 Total regulatory capital ratio 18.40 18.10 19.20 APRA leverage ratio 5.61 5.51 5.80 Level 1 Common equity Tier 1 capital ratio 11.08 11.35 12.38 $m 31 December 2022 30 September 2022 31 December 2021 Risk weighted assets at Level 2 Credit risk 363,914 362,098 359,773 Market risk 10,626 9,290 9,202 Operational risk 56,945 59,063 56,214 Interest rate risk in the banking book 43,866 42,782 12,190 Other 5,092 4,387 5,032 Total RWA 480,443 477,620 442,411 Total Exposure at Default 1,228,791 1,214,041 1,184,113 |

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| &nbsp;&nbsp;![GRAPHIC](tm237085d1_ex1img005.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pillar 3 report Executive summary 4 \| Westpac Group December 2022 Pillar 3 Report Exposure at Default Exposure at default (EAD) increased $14.8 billion over the quarter including: A $10.0 billion increase in sovereign exposures, supporting liquidity management; A $8.7 billion increase from residential mortgages; A $2.6 billion increase from specialised lending; and A $6.8 billion decrease in corporate exposures mainly from a decrease in market-related off-balance sheet exposures. Leverage Ratio The leverage ratio represents the amount of Tier 1 capital relative to exposure1 .. At 31 December 2022, Westpac's leverage ratio was 5.51%, down 10 basis points since 30 September 2022. The decrease in the leverage ratio reflected higher balance sheet exposures and lower Tier 1 capital as a result of payment of the 2022 final dividend. Liquidity Coverage Ratio (LCR) Westpac's average LCR2 for the quarter ending 31 December 2022 rose to 139%, up from 132% as at 30 September 2022. The increase was mainly driven by the removal of the APRA net cash outflows overlay on 1 September 2022, partially offset by a decrease in Liquid assets. 1 As defined under Attachment D of APS110: Capital Adequacy. 2 Calculated as a simple average of the daily observations over the quarter.  |

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| &nbsp;&nbsp;![GRAPHIC](tm237085d1_ex1img006.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pillar 3 report Introduction Westpac Group December 2022 Pillar 3 Report \| 5 Westpac Banking Corporation is an Authorised Deposit-taking Institution (ADI) subject to regulation by APRA. APRA has accredited Westpac to apply advanced models permitted by the Basel III global capital adequacy regime to the measurement of its regulatory capital requirements. Westpac uses the Advanced Internal Ratings-Based approach (Advanced IRB) for credit risk and the Standardised Measurement Approach (SMA) for operational risk. In accordance with APS330 Public Disclosure, financial institutions that have received the Advanced IRB accreditation, such as Westpac, are required to disclose prudential information about their risk management practices on a semi-annual basis. A subset of this information must be disclosed quarterly. In addition to this report, the regulatory disclosures section of the Westpac website1 contains the reporting requirements for: Capital instruments under Attachment B of APS330; and The identification of potential Global-Systemically Important Banks (G-SIB) under Attachment H of APS330 (disclosed annually). Capital instruments disclosures are updated when: A new capital instrument is issued that will form part of regulatory capital; or A capital instrument is redeemed, converted into CET1 capital, written off, or its terms and conditions are changed. 1 http://www.westpac.com.au/about-westpac/investor-centre/financial-information/regulatory-disclosures/ |

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| &nbsp;&nbsp;![GRAPHIC](tm237085d1_ex1img007.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pillar 3 report Group structure 6 \| Westpac Group December 2022 Pillar 3 Report APRA applies a tiered approach to measuring Westpac's capital adequacy1 by assessing financial strength at three levels: Level 1, comprising Westpac Banking Corporation and its subsidiary entities that have been approved by APRA as being part of a single 'Extended Licensed Entity' (ELE) for the purposes of measuring capital adequacy; Level 2, the consolidation of Westpac Banking Corporation and all its subsidiary entities except those entities specifically excluded by APRA regulations. The head of the Level 2 group is Westpac Banking Corporation; and Level 3, the consolidation of Westpac Banking Corporation and all its subsidiary entities. Unless otherwise specified, all quantitative disclosures in this report refer to the prudential assessment of Westpac's financial strength on a Level 2 basis2 .. The Westpac Group The following diagram shows the Level 3 conglomerate group and illustrates the different tiers of regulatory consolidation. Accounting consolidation3 The consolidated financial statements incorporate the assets and liabilities of all subsidiaries (including structured entities) controlled by Westpac. Westpac and its subsidiaries are referred to collectively as the 'Group'. The effects of all transactions between entities in the Group are eliminated on consolidation. Control exists when the parent entity is exposed to, or has rights to, variable returns from its involvement with an entity, and has the ability to affect those returns through its power over that entity. Subsidiaries are fully consolidated from the date on which control commences and they are no longer consolidated from the date that control ceases. Group entities excluded from the regulatory consolidation at Level 2 Regulatory consolidation at Level 2 covers the global operations of Westpac and its subsidiary entities, including other controlled banking, securities and financial entities, except for those entities involved in the following business activities: insurance; acting as manager, responsible entity, approved trustee, trustee or similar role in relation to funds management; non-financial (commercial) operations; or special purpose entities to which assets have been transferred in accordance with the requirements of APS120 Securitisation. Retained earnings and equity investments in subsidiary entities excluded from the consolidation at Level 2 are deducted from capital, with the exception of securitisation special purpose entities. 1 APS110 Capital Adequacy outlines the overall framework adopted by APRA for the purpose of assessing the capital adequacy of an ADI. 2 Impaired assets and provisions held in Level 3 entities are excluded from the tables in this report. 3 Refer to Note 30 of Westpac's 2022 Annual Report for further details. Level 1 Consolidation Level 2 Consolidation Level 3 Consolidation Regulatory non-consolidated subsidiaries Westpac New Zealand Ltd Other Westpac Level 2 subsidiaries Westpac Banking Corporation Westpac Level 1 subsidiaries |

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| &nbsp;&nbsp;![GRAPHIC](tm237085d1_ex1img008.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pillar 3 report Group structure Westpac Group December 2022 Pillar 3 Report \| 7 Subsidiary banking entities Westpac New Zealand Limited (WNZL), a wholly owned subsidiary entity, is a registered bank incorporated in New Zealand and regulated by the Reserve Bank of New Zealand (RBNZ). WNZL uses the Advanced IRB approach for credit risk and SMA for operational risk. Other subsidiary banking entities in the Group include Westpac Bank PNG-Limited and Westpac Europe Limited. For the purposes of determining Westpac's capital adequacy subsidiary banking entities are consolidated at Level 2. Restrictions and major impediments on the transfer of funds or regulatory capital within the Group Minimum capital ('thin capitalisation') rules Tax legislation in most jurisdictions in which the Group operates prescribes minimum levels of capital that must be retained in that jurisdiction to avoid a portion of the interest costs incurred in the jurisdiction ceasing to be tax deductible. Capital for these purposes includes both contributed capital and non-distributed retained earnings. Westpac seeks to maintain sufficient capital/retained earnings in these entities to comply with these rules. Tax costs associated with repatriation Repatriation of retained earnings (and capital) may result in tax being payable in either the jurisdiction from which the repatriation occurs or Australia on receipt of the relevant amounts. This cost would reduce the amount actually repatriated. Intra-group exposure limits Exposures to related entities are managed within the prudential limits prescribed by APRA in APS222 Associations with Related Entities1 .. Westpac has an internal limit structure and approval process governing credit exposures to related entities. This limit structure and approval process, combined with APRA's prudential limits, is designed to reduce the potential for unacceptable contagion risk. Prudential regulation of subsidiary entities On 23 March 2021, the RBNZ issued two notices to WNZL under section 95 of the Reserve Bank of New Zealand Act 1989 (NZ) requiring WNZL to supply two external reviews to the RBNZ (the Risk Governance Review and the Liquidity Review). These reviews only apply to WNZL and not to Westpac in Australia or its New Zealand branch. The Risk Governance Review related to the effectiveness of WNZL's risk governance, with a focus on the role played by the WNZL Board. The Risk Governance Review was completed in November 2021. WNZL has a programme of work underway to address the issues raised. This is being overseen by the WNZL Board. The Liquidity Review related to the effectiveness of WNZL's actions to improve liquidity risk management and the associated risk culture. The Liquidity Review was completed in May 2022. Recommendations for improvement arising from the review are being implemented as part of WNZL's continuous improvement activity. From 31 March 2021, the RBNZ amended WNZL's conditions of registration, requiring WNZL to discount the value of its liquid assets by approximately 14%. From 15 August 2022, the RBNZ reduced the overlay to approximately 7%, which at 31 December 2022 was NZ$1.7 billion. The overlay will remain in place until the RBNZ is satisfied that control assurance has been completed. 1 For the purposes of APS222, subsidiaries controlled by Westpac, other than subsidiaries that form part of the ELE, represent 'related entities'. Prudential and internal limits apply to intra-group exposures between the ELE and related entities, both on an individual and aggregate basis.  |

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| &nbsp;&nbsp;![GRAPHIC](tm237085d1_ex1img009.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pillar 3 report Capital overview 8 \| Westpac Group December 2022 Pillar 3 Report Capital management strategy Westpac evaluates its approach to capital management through an Internal Capital Adequacy Assessment Process (ICAAP), the key features of which include: The development of a capital management strategy, including consideration of regulatory minimums, capital buffers and contingency plans. The regulatory capital minimums in place at 31 December 2022 together with the capital conservation buffer (CCB) are the Total CET1 Requirement. The Total CET1 Requirement for Westpac is at least 8.0%, based on an industry minimum CET1 requirement of 4.5% plus a capital buffer of at least 3.5% applicable to D-SIBs1,2; Consideration of regulatory capital requirements and the perspectives of external stakeholders including rating agencies as well as equity and debt investors; and A stress testing framework that challenges the capital measures, coverage and requirements including the impact of adverse economic scenarios. On 1 January 2023, APRA's revised capital framework, including updated prudential standards for capital adequacy and credit risk capital, became effective. As part of the revised framework, APRA has set a Total CET1 Requirement for D-SIBs of 10.25%. This requirement includes a CCB of 4.75% applicable to D-SIBs and a base level for the countercyclical capital buffer of 1.0%. APRA has also indicated that it expects that D-SIBs (including Westpac) will likely operate with a CET1 capital ratio above 11% in normal operating conditions under the new framework. Westpac will seek to operate with a CET1 capital ratio of between 11.0% and 11.5% (operating capital range) in normal operating conditions as measured under the new capital framework from 1 January 2023. Revised Public Disclosure Prudential Standard (APS 330) As part of the revised capital framework, APRA has introduced a transitional prudential standard for public disclosures, including Pillar 3 effective from 1 January 2023. This is so that ADIs may make public disclosures for quarterly periods ending from 1 January 2023 that are consistent with the new capital framework until APRA's new public disclosure prudential standard becomes effective on 1 January 2025. Westpac will report under the revised transitional standard as part of the 31 March 2023 Pillar 3 report. 1 Noting that APRA may apply higher CET1 requirements for an individual ADI. 2 If an ADI's CET1 ratio falls below the Total CET1 Requirement (at least 8%), it faces restrictions on the distribution of earnings, such as dividends, distribution payments on AT1 capital instruments and discretionary staff bonuses.  |

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| &nbsp;&nbsp;![GRAPHIC](tm237085d1_ex1img010.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pillar 3 report Capital overview Westpac Group December 2022 Pillar 3 Report \| 9 Westpac's capital adequacy ratios Westpac New Zealand Limited's capital adequacy ratios % 31 December 2022 30 September 2022 31 December 2021 The Westpac Group at Level 2 Common equity Tier 1 capital ratio 11.1 11.3 12.2 Additional Tier 1 capital 2.1 2.1 2.2 Tier 1 capital ratio 13.2 13.4 14.4 Tier 2 capital 5.0 4.9 4.8 Total regulatory capital ratio 18.1 18.4 19.2 The Westpac Group at Level 1 Common equity Tier 1 capital ratio 11.1 11.3 12.4 Additional Tier 1 capital 2.2 2.2 2.2 Tier 1 capital ratio 13.3 13.6 14.6 Tier 2 capital 5.4 5.3 4.9 Total regulatory capital ratio 18.6 19.0 19.5 % 31 December 2022 30 September 2022 31 December 2021 Westpac New Zealand Limited Common equity Tier 1 capital ratio 11.4 11.0 14.2 Additional Tier 1 capital 1.9 2.0 2.8 Tier 1 capital ratio 13.3 13.0 17.0 Tier 2 capital 0.9 0.9 2.0 Total regulatory capital ratio 14.2 13.9 19.0  |

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| &nbsp;&nbsp;![GRAPHIC](tm237085d1_ex1img011.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pillar 3 report Capital overview 10 \| Westpac Group December 2022 Pillar 3 Report Capital requirements This table shows RWA and associated capital requirements1 for each risk type included in the regulatory assessment of Westpac's capital adequacy. More detailed disclosures on the prudential assessment of capital requirements are presented in the following sections of this report. Refer to the Executive summary for further commentary on RWA movements over the First Quarter 2023. 123 1 Total capital required is calculated as 8% of total risk weighted assets. 2 Westpac's standardised risk weighted assets are categorised based on their equivalent IRB categories. 3 Mark-to-market related credit risk is measured under the standardised approach. It is also known as Credit Valuation Adjustment (CVA) risk. 4 Other assets include cash items, unsettled transactions, fixed assets and other non-interest earning assets. 31 December 2022 IRB Standardised Total Risk Total Capital $m Approach Approach2 Weighted Assets Required1 Credit risk Corporate 885 71,568 72,453 5,796 Business lending 29,895 725 30,620 2,450 Sovereign 1,668 2,462 4,130 330 Bank 70 4,835 4,905 392 Residential mortgages 151,384 2,706 154,090 12,327 Australian credit cards 3,923 - 3,923 314 Other retail 697 6,539 7,236 579 Small business 13,917 - 13,917 1,113 Specialised lending 59,717 437 60,154 4,812 Securitisation - 7,241 7,241 579 Mark-to-market related credit risk3 5,245 5,245 420 Total 12,433 351,481 363,914 29,112 Market risk 850 10,626 Operational risk 4,556 56,945 Interest rate risk in the banking book 3,509 43,866 Other assets4 5,092 407 Total 38,434 480,443 30 September 2022 IRB Standardised Total Risk Total Capital $m Approach Approach2 Weighted Assets Required1 Credit risk Corporate 880 72,688 73,568 5,885 Business lending 30,541 738 31,279 2,502 Sovereign 1,689 2,335 4,024 322 Bank 84 4,609 4,693 375 Residential mortgages 149,208 2,885 152,093 12,167 Australian credit cards 3,917 - 3,917 313 Other retail 717 6,726 7,443 595 Small business 13,991 - 13,991 1,119 Specialised lending 57,338 428 57,766 4,621 Securitisation - 6,947 6,947 556 Mark-to-market related credit risk3 6,377 - 6,377 510 Total 13,798 348,300 362,098 28,965 Market risk 743 9,290 Operational risk 4,725 59,063 Interest rate risk in the banking book 3,423 42,782 Other assets4 4,387 351 Total 38,207 477,620  |

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| &nbsp;&nbsp;![GRAPHIC](tm237085d1_ex1img012.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pillar 3 report Capital overview Westpac Group December 2022 Pillar 3 Report \| 11 1234 1 Total capital required is calculated as 8% of total risk weighted assets. 2 Westpac's standardised risk weighted assets are categorised based on their equivalent IRB categories. 3 Mark-to-market related credit risk is measured under the standardised approach. It is also known as CVA risk. 4 Other assets include cash items, unsettled transactions, fixed assets, and other non-interest earning assets. 31 December 2021 IRB Standardised Total Risk Total Capital $m Approach Approach2 Weighted Assets Required1 Credit risk Corporate 882 71,124 72,006 5,760 Business lending 698 32,570 33,268 2,661 Sovereign 1,382 2,411 3,793 303 Bank 80 4,606 4,686 375 Residential mortgages 146,377 3,500 149,877 11,990 Australian credit cards 4,011 - 4,011 321 Other retail 765 7,917 8,682 695 Small business - 14,720 14,720 1,178 Specialised lending 376 56,903 57,279 4,582 Securitisation - 5,968 5,968 477 Mark-to-market related credit risk3 5,483 - 5,483 439 Total 13,166 346,607 359,773 28,782 Market risk 736 9,202 Operational risk 4,497 56,214 Interest rate risk in the banking book 975 12,190 Other assets4 5,032 403 Total 35,393 442,411  |

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| &nbsp;&nbsp;![GRAPHIC](tm237085d1_ex1img013.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pillar 3 report Credit risk exposures 12 \| Westpac Group December 2022 Pillar 3 Report Leverage ratio The following table summarises Westpac's leverage ratio. This has been determined using APRA's definition of the leverage ratio as specified in APS110 Capital Adequacy. $ billion 31 December 2022 30 September 2022 30 June 2022 31 March 2022 Tier 1 Capital 63.4 63.9 61.1 61.7 Total Exposures 1,151.3 1,140.3 1,140.4 1,101.4 Leverage ratio 5.5% 5.6% 5.4% 5.6% |

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| &nbsp;&nbsp;![GRAPHIC](tm237085d1_ex1img014.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pillar 3 report Credit risk exposures Westpac Group December 2022 Pillar 3 Report \| 13 Summary credit risk disclosure123 4 1 The above table reflects that at 31 December 2022, 30 September 2022 and 31 December 2021 Westpac applied a floor of 25% to its residential mortgage risk weights. This has resulted in an $8.8 billion increase to RWA at 31 December 2022, which was $0.8 billion higher than 30 September 2022 due to improved credit quality. 2 The above table reflects that at 31 December 2022, 30 September 2022 and 31 December 2021 Westpac applied a floor of 26% to its Australian Credit Cards risk weights. This has resulted in a $0.5 billion increase in RWA at 31 December 2022, which was flat to 30 September 2022. 3 Includes regulatory expected losses for defaulted and non-defaulted exposures. 4 Includes mark-to-market related credit risk. Regulatory Expected Specific Actual Risk Regulatory Loss for Provisions Losses for 31 December 2022 Exposure Weighted Expected non-defaulted Impaired for Impaired the 3 months $m at Default Assets Loss3 exposures Loans Loans ended Corporate 71,568 140,667 853 331 203 151 (37) Business lending 54,963 29,895 611 296 264 126 12 Sovereign 232,293 2,462 2 2 - - - Bank 21,078 4,835 6 6 - - - Residential mortgages1 151,384 605,540 1,389 995 291 69 10 Australian credit cards2 3,923 15,090 156 123 59 29 26 Other retail 8,688 6,539 288 195 169 88 33 Small business 27,724 13,917 448 286 364 133 7 Specialised Lending 71,103 59,717 930 593 38 8 - Securitisation 37,274 7,241 - - - - - Standardised4 12,433 14,371 - - 98 51 - Total 1,228,791 363,914 4,683 2,827 1,486 655 51 Regulatory Expected Specific Actual Risk Regulatory Loss for Provisions Losses for 30 September 2022 Exposure Weighted Expected non-defaulted Impaired for Impaired the 12 months $m at Default Assets Loss3 exposures Loans Loans ended Corporate 147,497 72,688 900 333 292 196 384 Business lending 54,390 30,541 626 315 274 142 84 Sovereign 222,327 2,335 2 2 - - - Bank 21,348 4,609 6 6 - - - Residential mortgages1 149,208 596,833 1,405 1,011 248 67 30 Australian credit cards2 3,917 15,068 153 120 60 30 104 Other retail 8,972 6,726 292 194 182 94 105 Small business 28,129 13,991 448 286 326 136 37 Specialised Lending 68,552 57,338 858 557 29 10 1 Securitisation 36,322 6,947 - - - - - Standardised4 13,798 14,603 - - 103 51 - Total 1,214,041 362,098 4,690 2,824 1,514 726 745 Regulatory Expected Specific Actual Risk Regulatory Loss for Provisions Losses for 31 December 2021 Exposure Weighted Expected non-defaulted Impaired for Impaired the 3 months $m at Default Assets Loss3 exposures Loans Loans ended Corporate 131,007 71,124 851 350 302 218 276 Business lending 53,029 32,570 631 358 303 153 22 Sovereign 221,413 2,411 2 2 - - - Bank 20,580 4,606 6 6 - - - Residential mortgages1 146,377 585,497 1,663 1,148 254 73 10 Australian credit cards2 4,011 15,407 151 121 56 30 27 Other retail 11,043 7,917 355 238 220 118 18 Small business 30,231 14,720 494 318 370 171 6 Specialised Lending 68,749 56,903 816 539 87 18 - Securitisation 31,185 5,968 - - - - - Standardised4 13,166 15,972 - - 95 40 - Total 1,184,113 359,773 4,969 3,080 1,687 821 359  |

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| &nbsp;&nbsp;![GRAPHIC](tm237085d1_ex1img015.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pillar 3 report Credit risk exposures 14 \| Westpac Group December 2022 Pillar 3 Report Exposure at Default by major type12 1 Average is based on exposures as at 31 December 2022 and 30 September 2022. 2 The EAD associated with securitisations is for the banking book only. 3 Average is based on exposures as at 30 September 2022, 30 June 2022, 31 March 2022, 31 December 2021 and 30 September 2021. 4 Average is based on exposures as at 31 December 2021 and 30 September 2021. 5 Westpac has restated the 31 December 2021 sovereign EAD. The restatement increases sovereign EAD. It does not have a material impact on RWA, or capital ratios and no other metrics have been impacted. Refer to the June 2022 Pillar 3 report for further details. 31 December 2022 On balance Total Exposure Average $m sheet Non-market related Market related at Default 3 months ended1 Corporate 67,228 58,986 14,453 140,667 144,082 Business lending 41,219 13,744 - 54,963 54,677 Sovereign 177,522 1,537 53,234 232,293 227,309 Bank 11,571 1,647 7,860 21,078 21,213 Residential mortgages 523,220 82,320 - 605,540 601,186 Australian credit cards 6,310 8,780 - 15,090 15,079 Other retail 6,116 2,572 - 8,688 8,830 Small business 20,842 6,882 - 27,724 27,927 Specialised lending 57,875 12,782 446 71,103 69,828 Securitisation2 7,799 29,431 44 37,274 36,798 Standardised 10,836 992 2,543 14,371 14,487 Total 952,170 198,041 78,580 1,228,791 1,221,416 30 September 2022 On balance Total Exposure Average $m sheet Non-market related Market related at Default 12 months ended3 Corporate 67,749 55,616 24,132 147,497 135,654 Business lending 41,223 13,167 - 54,390 53,473 Sovereign 167,403 1,560 53,364 222,327 217,545 Bank 11,081 1,479 8,788 21,348 21,332 Residential mortgages 515,283 81,550 - 596,833 588,235 Australian credit cards 6,128 8,940 - 15,068 15,246 Other retail 6,434 2,538 - 8,972 10,296 Small business 21,428 6,701 - 28,129 29,576 Specialised lending 56,370 11,902 280 68,552 69,429 Securitisation2 7,288 28,989 45 36,322 33,524 Standardised 10,929 974 2,700 14,603 15,275 Total 933,017 191,715 89,309 1,214,041 1,189,585 31 December 2021 On balance Total Exposure Average $m sheet Non-market related Market related at Default 3 months ended4 Corporate 57,899 60,629 12,479 131,007 130,625 Business lending 38,535 14,494 - 53,029 52,725 Sovereign5 1,759 165,638 54,016 221,413 188,860 Bank 12,248 1,568 6,764 20,580 20,932 Residential mortgages 506,258 79,239 - 585,497 583,816 Australian credit cards 6,245 9,162 - 15,407 15,401 Other retail 8,117 2,926 - 11,043 11,281 Small business 23,159 7,072 - 30,231 30,554 Specialised lending 54,766 12,787 1,196 68,749 67,740 Securitisation2 7,792 23,303 90 31,185 30,873 Standardised 11,742 1,023 3,207 15,972 16,326 Total 907,910 198,451 77,752 1,184,113 1,149,133 Off-balance sheet Off-balance sheet Off-balance sheet |

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| &nbsp;&nbsp;![GRAPHIC](tm237085d1_ex1img016.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pillar 3 report Credit risk exposures Westpac Group December 2022 Pillar 3 Report \| 15 Loan impairment provisions All Individually Assessed Provisions (IAPs) raised under Australian Accounting Standards (AAS) are classified as specific provisions in accordance with APS 220 Credit Risk Management. All Collectively Assessed Provisions (CAPs) raised under AAS are either classified into specific provisions or a General Reserve for Credit Loss (GRCL).1 1 Provisions classified according to APRA's letter dated 4 July 2017 "Provisions for regulatory purposes and AASB 9 financial instruments". 31 December 2022 Total Regulatory $m IAPs CAPs Provisions Specific Provisions for impaired loans 257 398 655 for defaulted but not impaired loans - 724 724 For Stage 2 - 2,005 2,005 Total Specific Provision1 2,986 398 3,384 General Reserve for Credit Loss1 - 1,408 1,408 Total provisions for ECL 4,394 398 4,792 30 September 2022 Total Regulatory $m IAPs CAPs Provisions Specific Provisions for impaired loans 274 452 726 for defaulted but not impaired loans - 673 673 For Stage 2 - 2,188 2,188 Total Specific Provision1 3,135 452 3,587 General Reserve for Credit Loss1 - 1,048 1,048 Total provisions for ECL 4,183 452 4,635 31 December 2021 Total Regulatory $m IAPs CAPs Provisions Specific Provisions for impaired loans 293 528 821 for defaulted but not impaired loans - 711 711 For Stage 2 - 1,780 1,780 Total Specific Provision1 2,784 528 3,312 General Reserve for Credit Loss1 - 1,454 1,454 Total provisions for ECL 4,238 528 4,766 A-IFRS Provisions A-IFRS Provisions A-IFRS Provisions |

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| &nbsp;&nbsp;![GRAPHIC](tm237085d1_ex1img017.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pillar 3 report Credit risk exposures 16 \| Westpac Group December 2022 Pillar 3 Report Impaired and past due loans The following tables disclose the crystallisation of credit risk as impairment and loss. Analysis of exposures defaulted not impaired, impaired loans, related provisions and actual losses are broken down by concentrations reflecting Westpac's asset categories.1 2 1 Includes items past 90 days not impaired. Specific Specific Actual 31 December 2022 Defaulted Impaired Provisions for Provisions to Losses for the $m not impaired1 Loans Impaired Loans Impaired Loans 3 months ended Corporate 203 215 151 74% (37) Business lending 1,175 264 126 48% 12 Sovereign - - - - - Bank - - - - - Residential mortgages 3,623 291 69 24% 10 Australian credit cards - 59 29 49% 26 Other retail - 169 88 52% 33 Small business 364 600 133 37% 7 Specialised lending 601 38 8 21% - Securitisation - - - - - Standardised 98 78 51 52% - Total 1,486 6,292 655 44% 51 Specific Specific Actual 30 September 2022 Defaulted Impaired Provisions for Provisions to Losses for the $m not impaired1 Loans Impaired Loans Impaired Loans 12 months ended Corporate 292 150 196 67% 384 Business lending 1,175 274 142 52% 84 Sovereign - - - - - Bank - - - - - Residential mortgages 3,576 248 67 27% 30 Australian credit cards - 60 30 50% 104 Other retail - 182 94 52% 105 Small business 326 557 136 42% 37 Specialised lending 549 29 10 34% 1 Securitisation - - - - - Standardised 103 72 51 50% - Total 1,514 6,079 726 48% 745 Specific Specific Actual 31 December 2021 Defaulted Impaired Provisions for Provisions to Losses for the $m not impaired1 Loans Impaired Loans Impaired Loans 3 months ended Corporate 302 139 218 72% 276 Business lending 1,016 303 153 50% 22 Sovereign - - - - - Bank - - - - - Residential mortgages 4,497 254 73 29% 10 Australian credit cards - 56 30 54% 27 Other retail - 220 118 54% 18 Small business 370 527 171 46% 6 Specialised lending 436 87 18 21% - Securitisation - - - - - Standardised 95 83 40 42% - Total 1,687 6,698 821 49% 359  |

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| &nbsp;&nbsp;![GRAPHIC](tm237085d1_ex1img018.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pillar 3 report Securitisation Westpac Group December 2022 Pillar 3 Report \| 17 Banking book summary of securitisation activity by asset type For the 3 months ended 31 December 2022 Amount Recognised gain or $m securitised loss on sale Residential mortgages 7,157 - Credit cards - - Auto and equipment finance - - Business lending - - Investments in ABS - - Other - - Total 7,157 - For the 12 months ended 30 September 2022 Amount Recognised gain or $m securitised loss on sale Residential mortgages 46,995 - Credit cards - - Auto and equipment finance - - Business lending - - Investments in ABS - - Other - - Total 46,995 - For the 3 months ended 31 December 2021 Amount Recognised gain or $m securitised loss on sale Residential mortgages 11,800 - Credit cards - - Auto and equipment finance - - Business lending - - Investments in ABS - - Other - - Total 11,800 - |

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| &nbsp;&nbsp;![GRAPHIC](tm237085d1_ex1img019.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pillar 3 report Securitisation 18 \| Westpac Group December 2022 Pillar 3 Report Banking book summary of on and off-balance sheet securitisation by exposure type 31 December 2022 Off-balance Total Exposure $m Securitisation retained Securitisation purchased sheet at Default Securities - 7,061 37 7,099 Liquidity facilities - - 280 280 Funding facilities 4,910 - 747 5,657 Underwriting facilities - - - - Lending facilities 2,141 - 325 2,466 Warehouse facilities 15,318 - 6,454 21,772 Total 7,061 22,369 7,843 37,274 30 September 2022 Off-balance Total Exposure $m Securitisation retained Securitisation purchased sheet at Default Securities - 7,054 35 7,089 Liquidity facilities - - 250 250 Funding facilities 4,816 - 912 5,728 Underwriting facilities - - - - Lending facilities 2,442 - 308 2,750 Warehouse facilities 14,678 - 5,827 20,505 Total 7,054 21,936 7,332 36,322 31 December 2021 Off-balance Total Exposure $m Securitisation retained Securitisation purchased sheet at Default Securities - 7,595 38 7,633 Liquidity facilities - - 312 312 Funding facilities 3,331 - 1,218 4,550 Underwriting facilities - - - - Lending facilities 956 - 288 1,244 Warehouse facilities 11,420 - 6,026 17,446 Total 7,595 15,708 7,882 31,185 On balance sheet On balance sheet On balance sheet |

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| &nbsp;&nbsp;![GRAPHIC](tm237085d1_ex1img020.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pillar 3 report Securitisation Westpac Group December 2022 Pillar 3 Report \| 19 Trading book summary of on and off-balance sheet securitisation by exposure type1 1 EAD associated with trading book securitisation is not included in EAD by major type on page 14. Trading book securitisation exposure is captured and risk weighted under APS116 Capital Adequacy: Market Risk. 31 December 2022 Off-balance Total Exposure $m Securitisation retained Securitisation purchased sheet at Default Securities - 433 - 433 Liquidity facilities - - - - Funding facilities - - - - Underwriting facilities - - - - Lending facilities - - - - Warehouse facilities - - - - Credit enhancements - - - - Basis swaps - - 35 35 Other derivatives - - 10 10 Total - 433 45 478 30 September 2022 Off-balance Total Exposure $m Securitisation retained Securitisation purchased sheet at Default Securities - 473 - 473 Liquidity facilities - - - - Funding facilities - - - - Underwriting facilities - - - - Lending facilities - - - - Warehouse facilities - - - - Credit enhancements - - - - Basis swaps - - 32 32 Other derivatives - - 13 13 Total - 473 45 518 31 December 2021 Off-balance Total Exposure $m Securitisation retained Securitisation purchased sheet at Default Securities - 218 - 218 Liquidity facilities - - - - Funding facilities - - - - Underwriting facilities - - - - Lending facilities - - - - Warehouse facilities - - - - Credit enhancements - - - - Basis swaps - - 79 79 Other derivatives - - 11 11 Total - 218 90 308 On balance sheet On balance sheet On balance sheet |

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| &nbsp;&nbsp;![GRAPHIC](tm237085d1_ex1img021.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pillar 3 report Liquidity Coverage Ratio 20 \| Westpac Group December 2022 Pillar 3 Report Liquidity Coverage Ratio (LCR) Westpac's average LCR for the quarter was 139% (30 September 2022: 132%) and continues to be comfortably above the regulatory minimum of 100%. The increase was mainly driven by the removal of the net cash outflows overlay on the 1st September 2022 partially offset by a decrease in Liquid assets. Liquid assets included in the LCR comprise High Quality Liquid Assets (HQLA), the Committed Liquidity Facility (CLF) offered by the Reserve Bank of Australia and additional qualifying RBNZ securities. In September 2021, APRA announced it expects ADIs subject to the LCR to reduce their CLF usage to zero by the end of 2022, subject to financial market conditions. The facility reduction is in four phases, the first three having occurred on 1 January 2022, 1 May 2022 and 1 September 2022 and the last occurred on 1 January 2023 (reducing by $9.25 billion on each date). Westpac's portfolio of HQLA averaged $176.5 billion over the quarter1 (30 September 2022: $175.2 billion). Funding is sourced from retail, small business, corporate and institutional customer deposits and wholesale funding. Westpac seeks to minimise the outflows associated with this funding by targeting customer deposits with lower LCR outflow rates and actively manages the maturity profile of its wholesale funding portfolio. Westpac maintains a buffer over the regulatory minimum of 100%. Effective 1 September 2022, APRA removed the liquidity add-on imposed for breaching APS210 as the remediation met APRA's requirements for removal. 1 Calculated as a simple average of the daily observations over the quarter. Total unw eighted value Total w eighted value (average)1 Total unw eighted value Total w eighted value (average)1 Liquid assets, of which: 1 High-quality liquid assets (HQLA) 175,177 176,451 2 Alternative liquid assets (ALA) 15,512 9,250 3 Reserve Bank of New Zealand (RBNZ) 418 3,040 Cash Outflows 4 Retail deposits and deposits from small business customers, of w hich: 28,390 317,759 318,760 28,683 5 Stable deposits 7,783 155,666 156,433 7,822 6 Less stable deposits 20,607 162,093 162,327 20,861 7 Unsecured w holesale funding, of w hich: 179,588 83,461 179,665 85,563 8 Operational deposits (all counterparties) and deposits in netw orks for cooperative banks 18,888 75,820 70,155 17,473 9 Non-operational deposits (all counterparties) 90,01 50,819 4 96,535 55,115 10 Unsecured debt 13,754 13,754 12,975 12,975 11 Secured w holesale funding - - 12 Additional requirements, of w hich: 205,521 27,517 204,823 27,228 13 Outflow s related to derivatives exposures and other collateral requirements 10,826 10,826 10,174 10,174 14 Outflow s related to loss of funding on debt products 289 289 819 819 15 Credit and liquidity facilities 194,406 16,402 193,830 16,235 16 Other contractual funding obligations 8,193 5,401 6,320 3,261 17 Other contingent funding obligations 41,943 3,578 45,855 3,957 18 Total cash outflows 148,692 148,347 Cash inflows 19 Secured lending (e.g. reverse repos) 5,661 - 5,147 - 20 Inflow s from fully performing exposures 8,195 4,468 9,187 5,588 21 Other cash inflow s 8,556 8,556 7,058 7,058 22 Total cash inflows 13,024 22,412 21,392 12,646 23 Total liquid assets 191,107 188,741 24 Total net cash outflows 145,297 135,323 24.1 Net cash outflow s overlay 24.1 Net cash outflows overlay - 9,251 25 Liquidity Coverage Ratio (%) 139% 132% Number of data points used Number of data points used 63 65 $m 31 December 2022 30 September 2022 |

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| &nbsp;&nbsp;![GRAPHIC](tm237085d1_ex1img022.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pillar 3 report Appendix I - APS330 quantitative requirements Westpac Group December 2022 Pillar 3 Report \| 21 The following table cross-references the quantitative disclosure requirements of APS330 to the quantitative disclosures made in this report. APS330 reference Westpac disclosure Page General Requirements Paragraph 49 Tier 1 capital, total exposures and leverage ratio 12 Attachment C Table 3: Capital Adequacy (a) to (e) (f) Capital requirements Westpac's capital adequacy ratios Capital adequacy ratios of major subsidiary banks 10 9 9 Table 4: Credit Risk - general disclosures (a) (b) (c) Exposure at Default by major type Impaired and past due loans General reserve for credit loss 14 16 15 Table 5: Securitisation exposures (a) (b) Banking Book summary of securitisation activity by asset type Banking Book summary of on and off-balance sheet securitisation by exposure type Trading Book summary of on and off-balance sheet securitisation by exposure type 17 18 19 Attachment F Table 20: Liquidity Coverage Ratio disclosure template Liquidity Coverage Ratio disclosure 20 Exchange rates The following exchange rates were used in this report and reflect spot rates for the period end. $31 December 2022 30 September 2022 31 December 2021 USD 0.6491 0.6778 0.7261 GBP 0.5841 0.5623 0.5377 NZD 1.1355 1.0704 1.0627 EUR 0.6620 0.6360 0.6411  |

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| &nbsp;&nbsp;![GRAPHIC](tm237085d1_ex1img023.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pillar 3 report Disclosure regarding forward-looking statements 22 \| Westpac Group December 2022 Pillar 3 Report The information contained in this report contains statements that constitute "forward-looking statements" within the meaning of section 21E of the U.S. Securities Exchange Act of 1934. Forward-looking statements are statements that are not historical facts. Forward-looking statements appear in a number of places in this report and include statements regarding Westpac's intent, belief or current expectations with respect to its business and operations, macro and micro economic and market conditions, results of operations and financial condition, capital adequacy and risk management, including, without limitation, future loan loss provisions and financial support to certain borrowers, forecasted economic indicators and performance metric outcomes, indicative drivers, climate- and other sustainability- related statements, commitments, targets, projections and metrics, and other estimated and proxy data. Words such as 'will', 'may', 'expect', 'intend', 'seek', 'would', 'should', 'could', 'continue', 'plan', 'estimate', 'anticipate', 'believe', 'probability', 'indicative', 'risk', 'aim', 'outlook', 'forecast', 'f'cast', 'f', 'assumption', 'projection', 'target,' goal', 'guidance', 'ambition' or other similar words are used to identify forward-looking statements, or otherwise identify forward-looking statements. These forward-looking statements reflect Westpac's current views on future events and are subject to change, certain known and unknown risks, uncertainties and assumptions and other factors which are, in many instances, beyond Westpac's control (and the control of Westpac's officers, employees, agents and advisors), and have been made based on management's expectations or beliefs concerning future developments and their potential effect upon Westpac. Forward-looking statements may also be made, verbally or in writing, by members of Westpac's management or Board in connection with this report. Such statements are subject to the same limitations, uncertainties, assumptions and disclaimers set out in this report. There can be no assurance that future developments or performance will align with Westpac's expectations or that the effect of future developments on Westpac will be those anticipated. Actual results could differ materially from those we expect or which are expressed or implied in forward-looking statements, depending on various factors including, but not limited to, those described in the section titled 'Risk Factors' in Westpac's 2022 Annual Report. When relying on forward-looking statements to make decisions with respect to Westpac, investors and others should carefully consider such factors and other uncertainties and events. Except as required by law, Westpac assumes no obligation to revise or update any forward-looking statements in this report, whether from new information, future events, conditions or otherwise, after the date of this report.  |

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