#129 June 2020 The Manager Company Announcements Australian Securities Exchange MyState Limited ABN 26 133 623 962 Level 2, 137 Harrington Street Hobart 7000 Tasmania Australia MYS ASX Release - Presentation to Debt Investors Correction The attached Presentation to Debt Investors replaces the equivalent document released to the market earlier today and corrects a typographical error on slide 9. The word 'Creditors' replaces the word 'Citizens' in the first line of clause (A) within the 'Ranking' section table. Yours faithfully, Akhb Scott Lukianenko Company Secretary#2MyState Limited Presentation to Debt Investors Subordinated Debt Issuance June 2020#3Corporate profile 01 Gary Dickson Chief Financial Officer Transaction details 02 Ryan Sharp Treasurer Strategy & highlights 03 Gary Dickson Chief Financial Officer Financial results Agenda 04 Gary Dickson Chief Financial Officer COVID-19 05 Gary Dickson Chief Financial Officer Capital, funding & liquidity 06 Ryan Sharp Treasurer#4Corporate profile#5MyState Sub Debt Issue | Investor Presentation 4 Limited Corporate profile MyState Group is a leading regional bank with Banking and Wealth Management operations ASX listed company Market capitalisation of c. $377m¹ Approximately 400 employees, over 140,000 customers Banking Home Loan Book: $4.90bn² TPT Wealth Funds Under Management: $1.19bn² Geographic home loan book spread Low MyState Limited Banking Wealth MyState Bank 87% Lending NT 0.1% QLD WA 1.6% 16.8% Deposits SA 0.8% Transactions NSW 21.6% Concentration VIC 17.2% TAS 40.9% High TPT WEALTH 13% Funds management Trustee services % of net revenue 1. At 26 June 2020 2. At 31 December 2019#6MyState Sub Debt Issue | Investor Presentation 5 Limited Key metrics and performance drivers FINANCIAL PERFORMANCE STRONG 1H20 PROFIT driven by solid uplift in total operating income Net profit after tax¹: INCREASED NET INTEREST INCOME driven by balance sheet growth and focused margin management Change* $15.1m +5.4% Earnings per share: 16.57cps +4.4% Return on tangible equity: 12.6% +20bps BALANCE SHEET + CAPITAL HIGH CUSTOMER SERVICE AND ADVOCACY underpinning growth in bank assets and deposits Customer deposits: $3.7b +0.6% Level 2 CET1 capital ratio: 11.38% +29bps EVERMORE DIGITALLY ENABLED 89% of all customer transactions performed online up 3% on 1H19 Level 2 Total capital ratio: 13.21% +31bps Total loan book: $5.1b +7.4% * Financial performance figures compare 1H20 to 1H19 as the previous corresponding period (pcp). Balance sheet and capital figures compare 30 June 2019 as pcp. All amounts shown represent statutory results inclusive of discontinued operations unless otherwise stated. 1. Excludes discontinued operations#7MyState Sub Debt Issue | Investor Presentation 6 Limited APRA regulatory group Level 1 Level 2 MyState Bank MyState Limited MyState Bank Connect Asset Management TPT Wealth sits outside the APRA Regulatory Group#8Capital markets issuance Strong capital markets brand MyState Sub Debt Issue | Investor Presentation 7 Limited Well established NCD programme Programmatic RMBS issuer via the Conquest RMBS programme. c. $2.9bn of capital markets RMBS issued since inception of the programme across 9 Trusts (8 public, 1 private placement) $2bn debt issuance programme MyState Limited and MyState Bank Limited $25m of 10nc5 Tier 2 qualifying subordinated notes issued by MyState Bank Limited on 14 August 2015 $10m of 10nc5 Tier 2 qualifying subordinated notes issued by MyState Bank Limited on 28 September 2016#9Transaction details#10MyState Sub Debt Issue | Investor Presentation 9 Limited Proposed subordinated debt structure Issuer: Issuer Rating: Expected Issue Rating Documentation Instrument Offer Size Structure Format Margin Ranking MyState Limited (ABN 26 133 623 962) Baa2/P-2 Baa3 Information Memorandum, Pricing Supplement Subordinated Notes AUD25,000,000 10NC5 Floating (quarterly payments) at the aggregate of 90 day BBSW plus the Margin [*] Subordinated Notes will constitute direct, subordinated and unsecured obligations of the Issuer ranking in a Winding-Up as set out in Condition 4.3, subject to the provisions for Conversion and Write-off, pari passu with all Equal Ranking Instruments. The claims of Holders against the Issuer in respect of Subordinated Notes that have not been Converted or Written- off will: (A) be subordinated in right of payment to the claims of all Senior Creditors and all such claims of Senior Creditors shall be entitled to be paid in full before any payment shall be paid on account of any sums payable in respect of such Subordinated Notes; (B) rank equally with the obligations of the Issuer to the holders of other Subordinated Notes that have not been Converted or Written-off, and the obligations of the Issuer to holders of Equal Ranking Instruments; and (C) rank prior to, and senior in right of payment to, the obligations of the Issuer to holders of Ordinary Shares and other Junior Ranking Capital Instruments. This is a summary of the proposed Terms and Conditions for MyState Limited Subordinated Notes - Further information and complete terms in connection to any issuance is included in the Information Memorandum dated 23 December 2016 as supplemented by the preliminary Pricing Supplement dated 29 June 2020#11MyState Sub Debt Issue | Investor Presentation 10 Limited Proposed subordinated debt structure Tax Governing Law Settlement Eligibility Listing Regulatory Treatment Payment Subject to Issuer Solvency Early Redemption Non-Viability Trigger Event The Issuer intends to issue the Subordinated Notes in a manner which will satisfy the public offer test under section 128F of the Income Tax Assessment Act 1936 (Cth) New South Wales, Australia Austraclear, Euroclear, Clearstream Unlisted Tier 2 Capital At any time prior to a Winding-Up: (a) the obligation of the Issuer to make any payment of principal or interest in respect of Subordinated Notes shall be conditional upon the Issuer being Solvent at the time the payment or other amount owing falls due; and (b) no amount is payable by the Issuer in respect of the Subordinated Notes unless, at the time of and immediately after such payment, the Issuer is Solvent. Subject to the prior written approval of APRA, the Subordinated Notes may be redeemed before the Maturity Date for certain tax and regulatory reasons at par plus accrued interest. Holders should not expect that APRA's approval will be given for any early redemption of Subordinated Notes. Holders have no right to request redemption before the Maturity date. A Non-Viability Trigger Event occurs when APRA has notified the Issuer in writing that it believes: (a) Conversion or Write-off of all or some Subordinated Notes or conversion or write down of all or some of the capital instruments of the Issuer is necessary because, without it, the Issuer would become non-viable; or (b) a public sector injection of capital, or equivalent support, is necessary because, without it, the Issuer would become non-viable. This is a summary of the proposed Terms and Conditions for MyState Limited Subordinated Notes - Further information and complete terms in connection to any issuance is included in the Information Memorandum dated 23 December 2016 as supplemented by the preliminary Pricing Supplement dated 29 June 2020#12MyState Sub Debt Issue | Investor Presentation 11 Limited Proposed subordinated debt structure Conversion Following a Non- Viability Trigger Event Conversion Number If a Non-Viability Trigger Event occurs, the primary method of loss absorption is Conversion. Upon a Non-Viability Trigger Event occurring, the Issuer may be required to Convert all or, in some cases a proportion of the Subordinated Notes into Ordinary Shares. If for any reason Conversion is not effected within five Business Days, Subordinated Notes will be Written-Off and Holders' rights, including any rights to unpaid interest or Additional Amounts and repayment of principal, will be immediately and irrevocably terminated with effect on and from the Conversion Date. On the Conversion Date, the Issuer will, for the Principal Amount of Subordinated Notes held by the Holder that is required to be Converted, allot and issue that number of fully paid ordinary shares in the capital of the Issuer which is the lesser of the number calculated according to the following formula and the Maximum Conversion Number: (the "Conversion Number") where: Principal Amount (1-CD) × VWAP during the VWAP Period Principal Amount (including where these words are used for the purposes of the definition of Residual Outstanding Principal Amount) means in respect of any Subordinated Note which is outstanding at any time, the outstanding principal amount of the Subordinated Note, and for such purposes: (a) the principal amount of a Subordinated Note issued at a discount, par or at a premium is at any time to be taken to be equal to its Denomination; and (b) if the principal amount of a Subordinated Note has from time to time been Converted or Written-off as described in, and in accordance with, Conditions 5 ("Non-Viability, Conversion and Write-off") and 6 ("Procedures for Conversion") the principal amount of the Subordinated Note will be reduced by the principal amount so Converted or Written-off; CD means 1%; and VWAP Period means in the case of a Conversion resulting from the occurrence of a Non-Viability Trigger Event, the period of 5 ASX Business Days on which trading in Ordinary Shares took place immediately preceding (but not including) the Non-Viability Trigger Event Date. This is a summary of the proposed Terms and Conditions for MyState Limited Subordinated Notes - Further information and complete terms in connection to any issuance is included in the Information Memorandum dated 23 December 2016 as supplemented by the preliminary Pricing Supplement dated 29 June 2020#13MyState Sub Debt Issue | Investor Presentation 12 Limited Proposed subordinated debt structure MyState Limited MyState Bank TPT WEALTH MyState Limited will be the issuer of the proposed Subordinated Notes Non-Operating Holding Company (NOHC) and head entity of the MyState Group and is ASX listed entity Regulated by APRA as an authorised NOHC of an APRA Level 2 group Issuing subordinated notes by MyState Limited improves the overall regulatory capital efficiency of the APRA Level 2 group MyState Limited holds 100% of the equity in MyState Bank and TPT Wealth Strong cash flow generation and capital position of subsidiary businesses supports capacity to upstream dividends. All existing Group debt is issued by MyState Bank (including the existing subordinated notes) MyState Limited does not issue debt or have any external borrowings (outside of the proposed Subordinated Notes) TPT Wealth does not issue debt or have any external borrowings#14Strategy & highlights#15Our strategic priorities MyState Sub Debt Issue | Investor Presentation 14 Limited Our GOAL is to be Simple, relevant and easy to "use" Digitally enabled so that we can attract and retain the target customers we are seeking more cost effectively Our STRATEGY is focused on Growing and automating our bank operations, increasing our digital capabilities and building our brand Agile with a strong focus on growth, margins and cost management Investing in contemporary, scalable wealth management and trustee products and systems and growth through mainland distribution Our strategy is DRIVEN BY Marketing, automation and continuous improvement, underpinned by a robust risk culture#16MyState Sub Debt Issue | Investor Presentation 15 Limited We are building a digital business that is attracting and engaging customers' Growing contribution from digital 62% increase in online customer growth 89% of all customer transactions performed online or on a mobile device Over 20% growth in eStatement registrations Leading customer advocacy and product offerings مضى Customer NPS +40 Bonus Saver account awarded 5 stars by Canstar & winner Mozo Experts Choice 2020 Regular Saver Business online saver winner of Mozo Choice 2020 Small Business No Strings Savings Loan book 59% mainland and proportion is increasing Operating momentum for further high quality growth Marketing investment up 39% Re-brand of Wealth Management as TPT Wealth Transition of funds management to a new digital platform powered by Link Market Services Selected as a panelist on the Federal Government's First Home Loan Deposit Scheme *All statistics compare 1H20 with 1H19 unless otherwise stated#17Outlook Revenue growth through: . • · Bank balance sheet growth Focused margin management FUM growth via mainland distribution MyState Sub Debt Issue | Investor Presentation 16 Limited Robotics technology now in use with more to come reducing operating costs. Re-engineering cost base, improving productivity and reinvesting in growth. Increased marketing spend to increase number of customers. Enhanced customer facing digital proposition. Further fund product rationalisation. Further investment in mortgage fund lending systems. Investing in trust management system. Growth of a highly scalable banking and funds management business#18Financial results#19Results summary MyState Sub Debt Issue | Investor Presentation 18 Limited 1H20 1H19 Change* Net interest income ($m) 48.16 44.15 +9.1% Positive jaws in 1H with income growth exceeding cost growth leading to a lower cost to income ratio Total operating income ($m)1 63.34 59.36 +6.7% Operating expenses (excl. BDD) ($m)1 41.12 39.23 +4.8% Net profit after tax ($m)1 15.12 14.34 +5.4% Earnings per share (cps) 16.57 15.87 +0.7cps Net interest margin (%) 1.82% 1.81% +1bp Cost to income ratio (%) 1 64.92% 66.08% -116bp Return on average equity increased on Level 2 Total capital ratio (%) 2 13.21% 12.90% +31bp pcp to 9.29% which compares favourably to regional bank peers Return on average equity (%)³ Return on tangible equity (%)³ 9.29% 9.02% +27bp 12.64% 12.44% +20bp Dividend-fully franked (cps)4 14.25 14.25 0.0cps Dividend payout ratio (%) 86% 90% -4% Credit performance - 30 day arrears (%) 0.56 0.52 +4bp *Financial performance figures compare 1H20 to 1H19 as the previous corresponding period (pcp). Balance sheet and capital figures compare 30 June 2019 as pcp. All amounts shown represent statutory results inclusive of discontinued operations unless otherwise stated 1. Excludes discontinued operations 234 2. As at 30 June 2019 3. Annualised FYTD 4. Interim dividend of 14.25cps paid to shareholders on the register at the record date of 2 March 2020#20MyState Sub Debt Issue | Investor Presentation 19 Limited MSB captures funding tailwinds BBSW 1.50 1.25 1.00 0.75 0.50 0.25 BBSW 1M BBSW 3M BBSW 6M 0.00 Jul 2019 Sep 2019 Nov 2019 Jan 2020 Mar 2020 NIM waterfall Origination costs Increase Decrease Net interest margin up +3bps on 2H19 Continued fall in wholesale funding costs Narrowing of BBSW-OIS spread contributed 10bps TD rates falling as book rolls to lower rates Lending market remains highly competitive NIM trend 2.00% 0.24% 1.80% 0.25% -0.02% 2.03% 1.91% 1.81% 1.79% 1.82% 1.60% 0.39% 0.46% 1.81% 1.82% 1.40% -0.01% 0.03% 1.20% 1H19 Asset Price Asset Mix Origination Funding Funding 1H20 1H18 2H18 1H19 2H19 1H20 Costs Price Mix#21MyState Sub Debt Issue | Investor Presentation 20 Limited Operating costs well managed Operating costs increased 4.82% led by increased investment in capability, marketing and digital Increased investment in marketing of $0.8m, up 39% on pcp One-off investment costs of $0.65m relating to rebrand of TPT Wealth and launch of new managed funds platform ($0.4m) and re-engineering the cost base ($0.25m) Underlying cost growth of 3.16% excluding one-off investment costs Restructuring costs to provide benefits in 2H20 One branch closure, network reduced to 13 branches $ Millions Operating expenditure 42 42 42 Expenditure breakdown One-off investment costs 45 41.1 38.7 39.2 39.0 41 21 41 0.02 0.120 0.15 0.23 0.73 0.54 0.64 0.38 0.63 $ Millions 40 36.8 2.7 1.9 1.9 2.7 2.6 35 3.2 1.8 3.1 3.0 2.9 7.5 30 6.0 6.7 6.9 6.1 40 40 40 40 15 41.12 10 18.5 17.5 18.0 17.4 19.1 5 39 0 39.23 39 1H18 2H18 1H19 2H19 1H20 +4.82% growth ■ Personnel Costs ■ Admin and Governance ■ Technology Occupancy Marketing 38 1H19 Personnel Restructuring Technology Occupancy Marketing Other 1H20 2250 9.3 9.1 9.4 8.5 9.0 1H20 Admin and Governance and Occupancy costs impacted by first time adoption of AASB16 Leases#22MyState Sub Debt Issue | Investor Presentation 21 Limited NPAT bridge NPAT growth of 5.4% Net interest income grew 9.1% on pcp off the back of a higher average balance sheet, falling. funding costs and focused margin management Disciplined management of costs while we continue to invest in marketing and digital Net bad and doubtful debts charge reflects a small increase in late stage arrears Arrears remain well below benchmarks for regional bank peers and major banks Net profit after tax 20 19 $ Millions 18 17 A 16 15- 14- 13 12 14.4 11 10 0.1 14.3 1H19 Statutory Profit/loss after NPAT tax from discontinued operations 1H19 NPAT from continuing operations 4.0 0.4 0.4 1.9 1.0 00 0.4 15.1 Net interest income Other banking income Wealth management income Operating expenditure Net bad and doubtful debts Income tax expense 1H20 Statutory NPAT#23MyState Sub Debt Issue | Investor Presentation 22 Limited Quality, low risk loan book. Emphasis on maintaining quality lending growth amidst strong competition Loan book growth eased in the half; offset by increases in NIM Home loan book - applications and settlements ($b) 1H 2H 2.50 2.00 Applications Settlements Lending momentum has returned with strong application flows towards the end of 2019. 1.50 1.00 0.98 0.76 1.00 0.71 Approved as a provider of the National First Home Loans Deposit Scheme 0.55 0.65 0.50 1.05 0.98 0.92 0.81 0.55 0.64 0.65 0.46 FY17 FY18 FY19 FY20 NT 0.1% Total book composition' ($m) +1% QLD 16.8% 4,269 4,550 4,739 5,038 5,088 WA 63 55 54 51 47 1.6% SA 63 72 68 69 70 0.8% 66 64 66 65 67 NSW 21.6% 4,076 4,358 4,551 4,852 4,904 Concentration VIC TAS 17.2% 40.9% Low High FY17 1. Excludes capitalised origination costs FY18 1H19 2H19 1H20 Housing Loans Personal Loans Business / Agri / Commercial Overdrafts#24MyState Sub Debt Issue | Investor Presentation 23 Limited High credit quality Consistent focus on lower LVR loans with high asset quality Uptick in arrears has lead to an increase in impairment provisions 30 and 90 day arrears well below industry Impairments remain at historic lows 30+ Days S&P Arrears Data Home loan book - LVR profile ($b) $0.20 $0.20 >90% $0.30 $0.35 $0.20 $0.37 $0.35 85%-90% 80%-85% 18% $0.26 $0.39 Home loan book composition (%) 79.4% 78.9% 78.9% <80% 82% $3.98 $4.01 Owner Occupier $3.51 Investor 20.6% 21.1% 21.1% FY18 FY19 1H20 FY18 FY19 1H20 SPIN Majors SPIN Regionals Group SPIN Majors 90+ Days S&P Arrears Data SPIN Regionals Group 3.20% 2.00% 2.80% 1.60% 2.40% 2.00% 1.20% 1.60% 0.80% 1.20% 0.80% 0.40% 0.40% 0.00% 0.00% Jul-18 Sep-18 Nov-18 Jan-19 Mar-19 May-19 Jul-19 Sep-19 Nov-19 Jan-20 Mar-20 Jul-18 Sep-18 Nov-18 Jan-19 Mar-19 May-19 Jul-19 Sep-19 Nov-19 Jan-20 Mar-20#25TPT Wealth Net FUM growth to $1.19b Wealth revenue increased 5.1%* on pcp due to higher trustee fees and funds management revenue Rebranding of Wealth operations as TPT Wealth and launch of new investor portal supporting plan for national growth Outsourced registry and funds admin providing business simplification and improved customer experience Closed Platform Mortgage Fund to simplify product suite TPT WEALTH *on a continuing business basis MyState Sub Debt Issue | Investor Presentation 24 Limited Funds under management ($m) 1,159 1,153 1,129 1H18 2H18 Operating income ($m) 1,186 1,170 1H19 2H19 1H20 8.2 8.0 7.9 7.8 7.5 2.61 2.93 2.83 2.50 2.36 5.60 5.02 5.10 5.32 5.12 1H18 2H18 1H19 2H19 1H20 Funds Management Trustees#26COVID-19#27MyState Sub Debt Issue | Investor Presentation 26 Limited COVID-19 assistance to customers On 24 March 2020, MyState Bank announced a range of new measures to support customers who may experiencing financial hardship due to COVID-19. These measures included: • be Home loan, personal loan or commercial loan customers can defer their payments for a period of up to six months - with a check in at 3 months • Allowing early access to Christmas Accounts without penalty • • • Raising the maximum threshold on MyState's high interest Bonus Saver Accounts from $150,000 to $250,000 Allowing customers to redraw on home and personal loans, with fee-free redraws in-branch or through the Customer Care team as well as online, which has always been free Allowing early access to Term Deposit Accounts for business customers#28MyState Sub Debt Issue | Investor Presentation 27 Limited COVID-19 assistance to customers Loans that have been provided assistance due to COVID-19: Total Balance of COVID-19 Assistance ($m) Assistance Type Home Loan Personal Loan MSB Commercial Total Restructure 59.14 0.18 0.11 59.42 Loan Pause 448.60 1.97 14.04 464.61 Change to Interest Only 47.09 0.02 0.57 47.67 Reduced Repayments Total Approved 9.98 564.80 9.98 2.17 14.71 581.68 3 month check-in call (consumer borrowers only): • . Check-in at the midway point through the 6 month loan pauses has been initiated. MSB endeavouring to call all customers and ask them about their financial position and ability to re- start payments. Resourcing has been increased to meet the additional workload and also maintain the focus on BAU collection activities.#29MyState Sub Debt Issue | Investor Presentation 28 Limited COVID-19 profile of customers provided assistance Home Loan LVR Breakdown Total COVID-19 Loans 0.9% 1.4% 0.8% 96.6% ■ Housing ■Commercial ■ Personal Loans - P2P Data as at 31 May 2020 ■ Personal Loans - Direct ■ Overdrafts 0.3% 6.9% 7.3% 6.1% 79.7% ■ <=80% ■80.01%-85% ■85.01%-90% ■ 90%+ Residential Portfolio - P&I v IO Residential Portfolio - OO V INV 88.85% 79.2% 20.8% 11.15% P&I Interest Only Investor Owner Occupier#30MyState Sub Debt Issue | Investor Presentation 29 Limited COVID-19 profile of customers provided assistance NT $0.47m, 0.08% WA $9.56m, 1.64% SA $4.10m, 0.70% 0% 5% 10% 15% 20% 25% 30% 35% 40%+ Data at 31 May 2020 QLD $114.01m, 19.60% NSW $170.12m, 29.25% VIC $143.70m, 24.70% ACT $2.29m, 0.39% TAS $137.42m, 23.63% COVID-19 hardship loans are predominantly located in NSW ($170m), followed by VIC ($144m), TAS ($137m) and QLD ($114m)#31Millions Millions MyState Sub Debt Issue | Investor Presentation 30 Limited COVID-19 profile of customers provided assistance Number of Advance Payments Purpose & Repayment Type $350 $297.47m $300 $250 $200 $150 $100 $50 $0 No Redraw $167.31m $468.63m $500 ■IO ■P&I Millions $400 $300 $48.39m $200 $21.84m $6.65m $33.68m $108.95m $6.33m $100 $4.10m 2 $0 4 5+ Owner Occupied Investment Non Housing Predominant Hardship Reasons $300 $259.60m $250 $200 $150 $138.39m $117.90m $100 $50 $0 Reduction in Income Business Shutdown Owner Business Shutdown Employee Unemployment Data at 31 May 2020 Employment $250 Millions $191.45m $200 $163.46m $150 $100 $65.83m $38.56m $50 $36.60m 50 $0 Casual Self Employed Part Time Full Time#32MyState Sub Debt Issue | Investor Presentation 31 Limited COVID-19 profile of customers provided assistance Average Balance of Loans with COVID-19 Assistance ($) State Home Loan Personal Loan Commercial All Lending ACT 327,539 327,539 NSW 507,721 22,652 614,269 501,824 NT 455,487 16,356 235,922 QLD 344,567 22,856 170,823 324,824 The average loan balance for COVID-19 assistance loans are slightly higher than the Bank's total SA 214,965 16,328 205,033 loan book. TAS 234,533 16,428 304,464 207,904 VIC 401,119 17,667 407,102 398,065 WA 340,963 9,850 329,546 All COVID-19 351,680 17,765 350,337 328,633 Total Lending Book 232,518 13,182 277,764 202,020 95% LVR change since origination (COVID-19 Assistance loans) 90% 85% 80% 75% 70% 65% 60% uln... ACT NSW NT QLD SA TAS VIC WA Average LVR (Origination) Average LVR (Indexed)#33Total portfolio arrears Home loan arrears profile (%) >99% of home loan book arrears is 30 days or less and therefore considered performing loans. 98.40% MyState Sub Debt Issue | Investor Presentation 32 Limited 1.00% 0.80% 0.60% 0.40% 0.20% Home loan arrears The increase since Mar 20 partly reflects the focus of the collections team on COVID-19 customer assistance. Resourcing of the collections team has been increased to manage future activity. 0.00% Jan 19 Mar 19 May 19 Jul 19 Sep 19 Nov 19 Residential 90+ dpd Jan 20 Mar 20 May 20 Commercial and personal arrears1 2.00% 1.50% 1.00% 0.94% 0.12% 0.13% 0.41% 0.50% On time <=30 days <=60 days <90 days 90+ days 0.00% Jan 19 Mar 19 May 19 Jul 19 Sep 19 Nov 19 Jan 20 Mar 20 May 20 Personal 90+ dpd Commercial 90+ dpd 1Direct personal loan portfolio only Data at 31 May 2020#34MyState Sub Debt Issue | Investor Presentation 33 Limited Provisions and coverage ratios Total Collective Provisions and GRCL ($m) 8.61 Loan provisioning strengthened for the potential impact of COVID-19 pandemic 2.0 6.3 5.1 2.3 4.4 3.6 2.4 1.5 4.3 2.7 1.9 Dec 18 2.1 0.4% Jun 19 Dec 19 May 20 (pro forma) ■COVID-19 Overlay ■General Reserve for Credit Losses (GRCL) Top Up Collective Provisions Total Provision Coverage Ratio 0.5% (Collective and GRCL) 0.2% 0.3% 4.44 0.13% 0.07% Jun 19 Dec 18 as % of Credit RWA 0.10% Dec 19 ■as % of Gross loans 0.17% May 20 (pro forma) 1The $3.5m increase in Total Collective Provisions and GRCL between Dec-19 and May-20 (pro-forma) is as follows: +$2.0m COVID-19 overlay (Collective Provision) +$1.4m GRCL Top-Up -$1.5m GRCL Top-up methodology change (contractual life to actual average life for stage 1 loans) +$1.6m Increase in total arrears and an ageing of arrears in the total loan book (Collective Provision) $3.5m has been used for the May-20 pro-forma which is the mid-point of the expected range of $3.0m - $4.0m#35-14% -12% -10% -8% -6% -4% -2% 0% 14% 12% 10% 8% 6% 4% 2% 0% MyState Sub Debt Issue | Investor Presentation 34 Limited COVID-19 economic outlook and scenario weightings Housing Prices (%) Dec 19 Mar 20 Jun 20 Sep 20 Dec 20 Mar 21 Jun 21 Sep 21 Dec 21 Base case Strong recovery Unemployment (%) Moderate recession Dec 19 Mar 20 Jun 20 Sep 20 Dec 20 Mar 21 Jun 21 Sep 21 Dec 21 Base case *Excludes GRCL Strong recovery Moderate recession Economic outlook – scenario weights - $2.0m Scenario weightings Jun-20 5% 50% Dec-19 15% 70% 45% ■Strong recovery Base case Moderate recession 15% Collective provisions - scenario outcomes ($m)* 0.5 (0.9) 2.0 4.3 3.9 100% Base case 100% Strong recovery 100% Moderate recession Probability weighted - collective provision#36Capital, funding & liquidity#3716% MyState Sub Debt Issue | Investor Presentation 36 Limited Well capitalised Capital ratios comfortably above regulatory minimums Capital position supported by earnings growth and securitised funding Effective capital strategy underpinning growth and investment in digital capability Issuance of replacement subordinated notes by MyState Limited will improve Level 2 regulatory capital efficiency 15% 1.70% 1.40% 14% Tier 1 capital Tier 2 capital Increase Decrease 0.42% 13.21% 0.11% 0.80% 0.09% 0.25% 13% 0.11% 0.11% 12.87% 1.83% 12% Impacts Tier 2 Capital only 1.94% 11% 10% 11.38% 9% 8% 7% Dec-19 Capital initiatives Securitised assets Profit Dividends paid Secured Capitalised mortgage intangibles lending Other asset growth 10.93% Provision COVID 19 overlay GRCL provision COVID 19 overlay May 20- Proforma#38MyState Sub Debt Issue | Investor Presentation 37 Limited Capital management approach Capital is managed under the Board approved ICAAP framework pursuant to APS 110. Capital is monitored on three levels: . • Regulatory Capital (APRA Approach) Rating Agency Capital (Moody's Approach) Economic Capital (Internal Risk Management Approach) MyState's current capital plan is for capital adequacy to be managed within the Board approved risk appetite over the 3 year ICAAP forecast period. The capital forecast is based on budget lending and RWA growth, capital expenditure and expected capital management activities and is reported to ALCO and the Board on a monthly basis. Risks to the capital forecast and potential capital actions are discussed at both ALCO and Board. Stress testing of capital is undertaken quarterly as part of the enterprise wide stress testing framework, ICAAP and Recovery Plan processes to assess the business' capacity to withstand and recover from significant shocks. Organic capital generation, warehouse securitisation and term RMBS are the primary form of capital generation for the Group, supplemented by use of the Dividend Reinvestment Plan and DRP underwrites as appropriate.#39MyState Sub Debt Issue | Investor Presentation 38 Limited Funding mix Funding mix enhanced by lower cost at call customer deposits Programmatic RMBS issuance continues to be well supported by broad investor- base Retail funding costs continuing to fall off the back of lower wholesale funding rates Bonus Saver account awarded 5 stars by Canstar and winner of Mozo Experts Choice 2020 Regular Saver Business Online Saver winner of Mozo Experts Choice 2020 Small Business No. Strings Savings Funding mix (%) 22.7 24.5 25.5 8.6 6.9 6.4 68.6 68.1 68.6 1H19 2H19 1H20 ■Customer deposits Wholesale deposits Securitisation Customer deposits ($m) 3.443 3.662 3.684 1.593 1.742 1.585 +1% +6% mozo EXPERTS CHOICE AWARDS 2020 2.069 1.942 1.858 OUTSTANDING VALLE CANSTAR SAVINGS SACCOUNT 1H19 2H19 1H20 ■Customer deposits at term ■Customer deposits at call#40Customer deposits MyState Sub Debt Issue | Investor Presentation 39 Limited MyState Customer Funding Ratio 70% 69% 68% 67% 66% 65% Customer deposits are the core part of the MyState funding strategy and provide a strong, sustainable base from which to support lending growth. The majority of deposits continue to be originated via the branch channel. Key transformational investment has been made to build out the digital capability of the organisation to access the online channel for growth. The use of third party introducers and deposit platforms is also available to supplement the branch and online channels. 64% Data s at 31 December 2019 Aug-18 Oct-18 Dec-18 Feb-19 Apr-19 Jun-19 Aug-19 Oct-19 Dec-19 Customer Funding Ratio#41MyState Sub Debt Issue | Investor Presentation 40 Limited Wholesale funding composition Securitisation remains the largest portion of wholesale funding. Approximately 80% of this is term RMBS Securitisation is used for both capital and funding Wholesale funding is actively managed by caps and maturity limits Wholesale Funding $16m, 1%, Wholesale funding provides MyState with diversification of its funding sources Internal RMBS portfolio sized to cover all short-term wholesale funding maturities (i.e. < 12 months) Wholesale Deposits $16m, 5% Data as at 31 December 2019 $311m, 18% $1,383m, 81% ■ At Call ■Term Deposits ■ NCDs ■ Securitisation $311m, 95% ■ At Call ■Term Deposits ■ NCDs#42Liquidity MLH Investments by Credit Rating ■1 (S&P AA- or above) 34% ■2 (S&P A- or above) 41% ■3 (S&P BBB- or above) 25% Unrated MLH Investments by Type 7% 51% Data at 31 December 2019 ■ NCD 41% LoanDeposit 120.0 MyState Sub Debt Issue | Investor Presentation 41 Limited MyState Bank is an MLH ratio bank Holding an elevated level of liquidity assets and contingent liquidity (i.e. internal RMBS) in response to the COVID-19 environment Majority of MLH Investments are repurchase eligible Limits in place to manage MLH Porfolio concentration risk by counterpart, credit rating and tenor MLH Ratio augmented by proxy LCR metric, 60 day cash flow projections and early warning indicators to support liquidity management MLH Maturity Profile ($m) 100.0 113.2 50.0 44.5 80.0 67.5 61.8 اسايي 15.1 3 4-6 7-12 1-2 >2 Years 17.0 3.0 At Call 1 Week 1 Month 0.0 FRN ■11am 40.0 1% Months Months Months Months Years#43MyState Sub Debt Issue | Investor Presentation 42 Limited Contingent funding plan & liquidity stress testing The Contingent Funding Plan (CFP) is undertaken and tested regularly as part of MyState's liquity risk management framework. Testing includes a fire drill test run by ALCO (at least annually) and regular testing of RBA repurchase capability The CFP includes detailed contingent funding options and strategies that are available to MyState in the event of deteriorating liquidity conditions The CFP is supported by a series of risk metrics, early warning indicators (qualitative and quantitative) and escalation protocols that have been designed to identify the emergence of increased risk or vulnerabilities in MyState's liquidity risk position or potential funding needs and allow MyState to take remediation actions as appropriate MyState undertakes quarterly liquidity stress testing as part of its enteprise wide stress testing framework. These stress tests consider the efficacy of contingent funding options against idiosyncratic and systemic scenarios at varying degrees of severity and timeframes that are calibrated to the macro-economic environment and MyState's business model and liquidity risk profile#44MyState Limited Sub Debt Issue | Investor Presentation 43 Disclaimer Summary Information This Presentation contains summary information about MyState and its activities current as at the date of this Presentation. The information is subject to change without notice and does not purport to be complete or comprehensive. It does not purport to summarise all information that an investor should consider when making an investment decision. It should be read in conjunction with MyState's other periodic and continuous disclosure announcements lodged with the Australian Securities Exchange, which are available at www.asx.com.au. Not Financial Product Advice This Presentation is for information purposes only and is not financial product advice or a recommendation to acquire shares. It has been prepared without taking into account any investor's objectives, financial position, situation or needs. Therefore, before making an investment decision, investors should consider the appropriateness of the information in this Presentation and have regard to their own objectives, financial situation and needs. Investors should seek such financial, legal or tax advice as they deem necessary or consider appropriate. MyState is not licensed to provide financial product advice in relation to the offer of shares. Cooling off rights do not apply to the acquisition of the shares. Financial Information All information in this Presentation is in Australian dollars ($) unless stated otherwise. A number of figures, amounts, percentages, estimates, calculations of value and fractions in this presentation are subject to the effect of rounding. Accordingly, the actual calculation of these figures may differ from the figures set out in this presentation and totals may vary slightly due to rounding. All references to financial years (FY) appearing in this Presentation are to the financial years ended on 30 June of the indicated year. Past Performance Past performance information, including past share price information, given in this Presentation is given for illustrative purposes only and should not be relied upon as (and is not) an indication of future performance. Future Performance This Presentation may contain "forward-looking" statements including statements regarding MyState's intent, belief or current expectations with respect to their business operations, market conditions, results of operations, financial conditions, and risk management practices. Forward-looking statements can generally be identified by the use of forward- looking words such as "anticipated", "expected", "aim", "predict", "projections", "guidance", "forecast", "estimates", "could", "may", "target", "consider", "will" and other similar expressions. Indications of, and guidance on, future earnings, financial performance, and financial position are also forward looking statements. Forward looking statements, opinions and estimates are based on assumptions and contingencies which are subject to certain risks, uncertainties and change without notice, as are statements about market and industry trends, which are based on interpretations of current market conditions. Forward-looking statements including projections, indications or guidance on future earnings or financial position and estimates are provided as a general guide only and should not be relied upon as an indication or guarantee of future performance. Should one or more of the risks or uncertainties materialise, or should underlying assumptions prove incorrect, there can be no assurance that actual outcomes will not differ materially from these statements. To the fullest extent permitted by law, MyState and its directors, officers, employees, advisers, agents and intermediaries disclaim any obligation or undertaking to release any updates or revisions to the information to reflect any change in expectations or assumptions. Investment Risk An investment in securities in MyState is subject to investment and other known and unknown risks, some of which are beyond the control of MyState, including possible loss of income or principal invested. MyState does not guarantee any particular rate of return or the performance of MyState. Investors should have regard to the risk factors outlined in this Presentation when making their investment decision. 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