#1ANZ Green Bonds Investor Presentation May 2015 ANZ#2Index ANZ Green Bonds ANZ Overview 1H15 Result Overview Treasury Credit Quality All figures within this investor discussion pack are presented on Cash basis in Australian Dollars unless otherwise noted. In arriving at Cash Profit, Statutory Profit has been adjusted to exclude non-core items, further information is set out on page 86 of the 2015 Half Year Consolidated Financial Report. Common growth rate abbreviations used in this presentation include PCP: Prior comparable period growth rate; HoH: Half on Half growth rate 3 10 18 25 34 ANZ 2#3ANZ Green Bonds Investor Presentation Summary of Green Bond Proposal ANZ#4ANZ is proposing to issue its first Green Bond Climate Bond Certified As part of ANZ's commitment to actively managing and reducing the environmental impact of its activities, ANZ is proposing to issue its first Green Bond Key points • • • • The transaction will involve issuance of a senior unsecured debt instrument by ANZ denominated in A$, with a 5-year tenor, paying fixed rate semi-annual coupons Proceeds will be used to finance an existing ~AUD1.1bn pool of Eligible Assets that directly contribute to developing low-carbon industries, technologies and practices. Specifically, wind farms, solar energy. projects and green buildings An Asset Register will be maintained to link Green Bond proceeds with Eligible Assets on ANZ systems ANZ Green Bonds rank pari passu with all other ANZ senior unsecured debt instruments. Payment of interest or principal on ANZ Green Bonds is not linked to the performance of the underlying eligible assets ANZ Green Bonds are expected to be included in the MSCI/Barclays Green Bond Index and the Bloomberg AusBond Composite Bond Index This transaction supports a growing market for environmentally conscious investments ANZ 4#5ANZ is proposing to issue its first Green Bond Climate Bond Certified Certification & Verification • • ANZ Green Bonds have been certified by the Climate Bonds Initiative (CBI) - a Not-For-Profit organisation that aims to promote large-scale investments that will help to deliver a low-carbon economy The CBI's standards provide a framework to ensure that Green Bond proceeds are used in ways that are consistent with delivering a low-carbon economy (http://www.climatebonds.net/standards) Compliance with CBI standards has been independently verified by Ernst & Young Eligible Assets • • Wind - projects involved in the development, construction and operation of wind farms; or operate production facilities dedicated solely to wind energy; or have wholly dedicated transmission infrastructure for wind farms. - Solar projects involved in the development, construction and operation of generation facilities, where 100% of electricity is derived from solar energy or where no more than 15% of electricity is supported by gas fired back-up; or projects that operate production facilities wholly dedicated to solar energy development; or projects with wholly dedicated transmission infrastructure for eligible solar electricity generation facilities. Commercial Buildings - Green Star 4 Star-rated commercial buildings that meet a minimum required threshold of CO2 emissions and that are at least in the top 15% of buildings in their city for reduced carbon emissions (checked and reported annually). ANZ 5#6ANZ is proposing to issue its first Green Bond ANZ's Green Asset Portfolio Climate Bond Certified Portfolio Composition¹ Project Bald Hills Wind Farm Collgar Wind Farm Mumbida Wind Farm Taralga Wind Farm Wonthaggi Wind Farm Macarthur Wind Farm Hallet 5- Bluff Range Class Country By Asset Class Wind Australia Wind Australia Solar 2% Wind Australia Wind Australia Wind Australia Wind Australia Buliding 40% Wind 58% Wind Australia Boco Rock Wind Farm Wind Australia Royalla Solar Australia Brookfield Tower Place 1, Perth Building Australia Brookfield Tower Place 2, Perth Building Australia Tower 4, Collins Square, Melbourne Building Australia By Geography 161 Castlereagh St, Sydney Building Australia New Mahinerangi Wind Farm Wind New Zealand Zealand 7% Tuararua Wind Farm Wind New Zealand Changbin Wind Chungwei Wind Wind Taiwan Wind Asia 16% Taiwan Miaoli Wind Farm Burgos Wind Farm Current Aggregated Volume Wind Taiwan Wind |Phillippines ~A$1.1bn Australia 77% 1. Calculated based on total drawn funding at time of issuance. ANZ 6#7ANZ is proposing to issue its first Green Bond Asset Pool Climate Bond Certified • • Future assets will be added and verified for eligibility as new business is written and/or CBI criteria is released for other potential classes (expected for geothermal and transport assets) Disclosure Information on ANZ's Eligible Asset pool will be updated annually on anz.com Post-issuance assurance will be provided by Ernst & Young to verify on-going compliance with CBI standards. Assurance statements will be published on anz.com, commencing circa six months after the initial transaction and on annual anniversary of issue date thereafter Surplus Funds & Non-Contamination . • ANZ expects to maintain a portfolio of Eligible Assets whose aggregate volume exceeds the principal amount of ANZ Green Bonds. However, there can be no assurance (and there is no legal obligation) that that this will be the case nor that ANZ Green Bonds will retain CBI certification for the life of the deal Should ANZ's portfolio of Eligible Assets fall below the principal value of ANZ's outstanding Green Bonds¹ or ANZ Green Bonds lose CBI certification for any reason, this does not constitute an Issuer Event of Default nor does it entitle investors to early repayment of principal or interest Further, CBI may revise its standards subsequent to the Issue Date and ANZ Green Bonds may subsequently no longer comply with the then current CBI Standards 1 Note that if the aggregate volume of ANZ's portfolio of Eligible Assets falls below the principal amount of ANZ Green Bonds, ANZ may, in its absolute discretion, apply the surplus funds to allowable products under the CBI standards - eg. Government securities ANZ, 7#8EY Assurance Statement EY Building a better working world Ernst & Young Services Pty Limited 680 George Street Sydney NSW 2000 Australia GPO Box 2846 Sydney NSW 2001 Tel: +61 2 9248 5555 Fax: +61 2 9248 5959 ey.com/au EY Building a better working world Page 2 Climate Bond Certified Independent Reasonable Assurance Report to the Directors and Management of ANZ Assurance conclusion Based on our reasonable assurance procedures, as described in this statement as of 20 April 2015, in our opinion ANZ's bond issuance process in relation to its 2015 Green Bond meets the project identification, project minimum criteria, management of proceeds, and reporting requirements of the Climate Bond Standard, in all material respects. Scope We have performed a reasonable assurance engagement in relation to ANZ's 2015 Green Bond issuance in order to provide an opinion as to whether the subject matter detailed below meets, in all material respects, the criteria as presented below as of 20 April 2015. Subject matter The subject matter for our assurance is: ANZ's Green Bond Issuance process, being: 0 © 0 0 Identification of wind energy generation, solar energy generation and commercial building projects; Minimum criteria for eligible wind energy generation, solar energy generation and lower emissions commercial building projects. Policies and procedures for the management of proceeds; and Policies and procedures for reporting on use of proceeds and project performance ANZ's list of 2015 Green Bond nominated wind, solar PV and commercial building projects Criteria The criteria for our procedures (the criteria') is: The Climate Bond Standard v1.0, including eligibility criteria for wind energy generation and solar energy generation The Climate Bond Standard Energy Efficiency- Commercial Property eligibility criteria and guidelines Assurance Approach Our assurance approach was conducted in accordance with the Australian Standard on Assurance Engagements ASAE 3000: Assurance Engagements Other than Audits or Reviews of Historical Financial Information and ASAE 3100: Compliance Engagements. Management Responsibility The management of ANZ (Management') are responsible for the collection, preparation and presentation of the subject matter in accordance with the criteria and for maintaining adequate records and internal controls that are designed to support the Green Bond issuance process. Assurance Practitioner's Responsibility Our responsibility is to express a reasonable assurance conclusion as to whether the subject matter is presented in accordance with the criteria, in all material aspects. Our assurance engagement has been planned and performed in accordance with the Australian Standard on Assurance Engagements 3000 (revised) Assurance Engagements Other Than Audits or Reviews of Historical Financial Information (ASAE 3000) and ASAE 3100: Compliance Engagements ("ASAE 3100"). Level of Assurance A reasonable assurance engagement consists of making enquiries and applying analytical, controls testing and other evidence-gathering procedures that are sufficient for us to obtain a meaningful level of assurance as the basis for a positive form of conclusion. The procedures. performed depend on the assurance practitioner's judgement including the risk of material misstatement of the specific activity data, whether due to fraud or error. While we considered the effectiveness of Management's internal controls when determining the nature and extent of our procedures, our review was not designed to provide assurance on internal controls. We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our conclusion. Our Approach Our assurance procedures performed included, but were not limited to: Assessing policies and procedures established by ANZ related to the issuance of the 2015 Green Bond; Confirming eligibility of nominated projects for inclusion in ANZ's 2015 Green Bond Interviewing selected business unit and group level personnel to understand the key issues related to the ANZ's policies and procedures; Reviewing selected performance information for all nominated projects, and documentation supporting assertions made in the subject matter: Checking the accuracy of calculations performed, and Obtaining and reviewing evidence to support key assumptions and other data. A summary of our assurance procedures is shown in the following Table. Reviewed documentation of the process that ANZ follows to identify projects, and confirmed. eligibility requirements for inclusion of Nominated Projects in the 2015 Green Bond issuance. Reviewed the allocation of funds to ensure they can be against nominated projects Reviewed documentation for the management of proceeds from the 2015 Green Bond issuance for funds that are not allocated to a nominated project.. Reviewed ANZ's environmental and social integrity policy and confirmed its coverage for all nominated projects. Confirmed that ANZ undertook a third-party verification before issuance of the Green Bond with an approved Climate Bond verifier Item Requirement Assurance Procedures 1 Project Nomination 2 Use of Proceeds 3 Non- Contamination Environmental & Social Integrity 5 Verification 6 Climate Bond Certification and Limits of Use T Non-Compliance 4 8 Eligible projects & physical assets 9 Technical criteria - 10 Traceability 11 Project holding Confirmed that ANZ intends to use the Climate Bond Certification mark for the term of the approved 2015 Green Bond while the bond maintains compliance with the Climate Bond Standard. Confirmed that ANZ's policy is to inform the CBI and all relevant stakeholders if the 2015 Green Bond becomes non-compliant with the Climate Bond Standard Confirmed that nominated projects in the bond are eligible projects under the Climate Bond standard Tested nominated projects to determine that they meet the minimum technical requirements of the Climate Bonds Standard Confirmed that policies, process and procedures for tracking financial flows of the bond principal between ANZ's 2015 Green Bond and the linked Nominated Project(s) are in place. Confirmed that policies, process and procedures for demonstrating that the linked portfolio underlying the bond continues to hold nominated projects equal to the face value of the bond issuance are in place. Confirmed that policies, processes and procedures to ensure that nominated project names and details are disclosed to the Verifier Confirmed that policies, processes and procedures to ensure that the settlement timeframe is specified, and that settlement occur within the stated timeframe are in place. Confirmed that policies, processes and procedures to identify flows of proceeds related to the Bond have been established. 12 Confidentiality 13 Settlement period 14 Earmarking funds Limitations There are inherent limitations in performing assurance- for example, assurance engagements are based on selective testing of the information being examined- and it is possible that fraud, error or non-compliance may occur and not be detected. There are additional inherent risks associated with assurance over non- financial information including reporting against standards which require information to be assured against source data compiled using definitions and estimation methods that are developed by the reporting entity. Finally, adherence to ASAE 3000, ASAE 3100 and the Climate Bond Standard is subjective and will be interpreted differently by different stakeholder groups. Our assurance was limited to the ANZ's 2015 Green Bond pre-issuance, and did not include statutory financial statements. Our assurance is limited to policies and procedures in place as of 20 April 2015, ahead of the issuance of ANZ's 2015 Green Bond. Use of Report Our responsibility in performing our assurance activities is to the directors of ANZ only and in accordance with the terms of reference for this engagement as agreed with them. We do not therefore accept or assume any responsibility for any other purpose or to any other person or organisation. Any reliance any such third party may place on the 2015 Green Bond issuance is entirely at its own risk. No statement is made as to whether the criteria are appropriate for any third party purpose. Our Independence and Assurance Team In accordance with APES 110, the firm and all professional personnel involved in this engagement have met the independence requirements of Australian or International professional ethical requirements. Our team has the required competencies and experience for this assurance engagement. En sy Ernst & Young то Dr Matthew Bell Partner Sydney, Australia 20 April 2015 Amember of Ernst & Young-mited- Liability limited by a scheme approved under Professional Standa bert Einst&Young G Celery 100 y ahora curice inder Price funds comision ANZ 8#9Climate Bond Standards Certification Climate Bonds Climate Bond Certified 15 May 2015 Katharine Tapley Director, Low Carbon Solutions Australia and New Zealand Banking Group Ltd. Level 12, 100 Queen St., Melbourne, Victoria, 3000 Australia Dear Katharine Re: Confirmation of approval for request for Climate Bond Standards certification I'm very pleased to inform you that, at its meeting on Tuesday 21 April, the Climate Bond Standards Board approved the certification of the proposed ANZ Climate Bond, as per the application documents and verification report provided by Australia and New Zealand Banking Group Ltd. That certification comes into force once the bond is placed on offer. Members of the Climate Bond Standards Board are: • California State Teachers Retirement Service (CalSTRS) represented by Paul Shantic, Co-Director of Fixed Income. California State Treasurer John Chiang, represented by California State Deputy Treasurer Alan Gordon. CDP (formerly the Carbon Disclosure Project), represented by Chris Fowle. Institutional Investors Group on Climate Change (IIGCC), represented by Eric Borremans. The International Cooperative and Mutual Insurance Federation represented by Shaun Tarbuck. Investor Group on Climate Change represented by Andrew Major of HESTA. Investor Network on Climate Risk, represented by Peter Ellsworth. The Natural Resources Defense Council, represented by Douglas Sims. I also confirm that the text of the Certification Agreement between the Climate Bond Standards Board and Australia and New Zealand Banking Group Ltd. has been agreed. Accordingly I confirm that Australia and New Zealand Banking Group Ltd. may use the "Climate Bond Certified" logo in its information materials about the proposed bond, and we will ensure the bond is identified as a Climate Bond in all listings we manage. Attached for your reference is a guide to usage of the "Certified Climate Bond" logo. Congratulations and best wishes, Searklindy Sean Kidney Chair, Climate Bond Standards Board CEO, Climate Bonds Initiative 72 Muswell Hill Place, London N10 3RR United Kingdom | www.climatebonds.net The Climate Bonds Initiative is a not-for-profit company registered in the United Kingdom Companies House number 7455730 ANZ 9#10ANZ Green Bonds Investor Presentation ANZ Overview ANZ#11SUPER REGIONAL STRATEGY STRONG CORE MARKETS PROFITABLE ASIAN GROWTH ENTERPRISE APPROACH STRONG LIQUIDITY AND CAPITAL MANAGEMENT DISCIPLINED AND EXPERIENCED MANAGEMENT Improving customer CEO PRIORITIES FY14-16 Diversifying revenue Improving productivity experience Improving returns ANZ 11#12ANZ Operating Structure • · • Operating Divisions Retail Banking Australia Division Corporate & Commercial Banking New Zealand Division Retail Banking Commercial & Agri Banking International & Institutional Banking (IIB) Client Segments International Banking Global Products • Transaction Banking Global Banking • Markets • Retail Banking Asia Pacific • Loans • Global Wealth 1H15 Operating Income Mix by Division ■Australia ■New Zealand ■IIB ■Wealth 8% 37% 13% 42% Operating Income by Geography 1H15 | Australia 62% Insurance • Private Wealth Funds Management • Advice & Distribution New Zealand 18% APEA APEA Network 25% 20% APEA Network Revenue represents income generated in APEA plus income generated in Australia & New Zealand as a result of referral from ANZ's APEA network. ANZ 12#13Income and profit contribution by division and geography Operating Income by Division Net Profit after Tax by Division $m $m 12,000 4,000 7% 3,500 6% 8% 8% 10,000 8% 8% 10% 3,000 6% 37% 8% 8% 38% 36% 8,000 2,500 36% 37% 36% 38% 35% 37% 38% 6,000 2,000 4,000 12% 13% 13% 13% 13% 1,500 12% 14% 15% 14% 15% 1,000 2,000 43% 43% 41% 42% 42% 44% 42% 41% 42% 41% 500 0 1H13 2H13 1H14 ■Australia ■New Zealand 2H14 ■ IIB 1H15 ■Wealth 1H13 2H13 1H14 2H14 1H15 ■Australia ■New Zealand ■IIB Wealth Operating Income by Geography Net Profit after Tax by Geography $m 12,000 $m 4,000 10,000 15% 20% 19% 18% 20% 3,000 8,000 16% 16% 17% 14% 17% 20% 16% 16% 16% 15% 18% 18% 19% 23% 22% 6,000 2,000 4,000 68% 68% 68% 66% 62% 1,000 68% 64% 65% 58% 58% 2,000 0 1H13 2H13 1H14 2H14 1H15 ■Australia ■New Zealand ■APEA 1H13 2H13 1H14 2H14 1H15 ■Australia ■New Zealand ■APEA ANZ 13#14Loans and deposits by division and geography - 1H15 Customer Lending¹ by Division New Zealand Customer Deposits by Division 17% IIB 28% Australia IIB 46% New Zealand 14% Global Wealth 53% 1% Australia 37% Global Wealth 4% Customer Lending¹ by Geography Customer Deposits by Geography Australia 65% APEA 16% New Zealand 19% 1. Customer lending represents Net Loans & Advances including acceptances. APEA 30% Australia 52% New Zealand 18% ANZ 14#15Total Credit Exposure (EAD) by Geography Exposure at Default¹ by Geography Total Exposure at Default (Mar 15) - $869b¹ Australia $515.8b New Zealand $149.5b UK & Europe 4% New Zealand 17% Americas 4% Pacific 1% 4% Singapore APEA 24% 3% Hong Kong 6% Other North East Asia 2% Other South East Asia Exposure at Default by Line of Business² APEA 16% $204.1b 29% Australia 59% 31% 22% 94% 53% 49% Australia ■Retail 1. EAD excludes amounts for 'Securitisation' and 'Other Assets' Basel asset classes. 2. Institutional includes exposure to Bank and Sovereign counterparties and ANZ's Liquidity portfolio. New Zealand Institutional 6% APEA ■Commercial ANZ 15#16IIB - Asia IIB 1H15 profit by region Revenue growth in higher ROE businesses³ A$m, % growth PCP USD m (4)% 20% 167% (33)% 24% 143 148 126 18% 688 25% 149 177 178 25% 596 8% 59 64 52 9% Higher ROE 43% 257 330 334 48% 95 60 80 Aus/NZ Asia EMEA Pacific Asset tenor² By tenor - 1H15 (%) 29% 1H13 1H14 1H15 Markets Cash Global Loans Trade IIB Asia Profitable growth US$m 1.63% 1.51% 1.23% 0.77% 0.81% 0.46% 489 451 324 37% 64% 63% 71% 36% Asia Aus NZ ■Tenor >1Yr ■Tenor <1Yr 1. 'RoRWA' equals Net Profit After Tax divided by average Basel III risk weighted assets. 2. Institutional exposures only. 3. Excludes Retail and partnerships. 1H13 NPAT 1H14 RORWA IIB Asia 1 1H15 RORWA IIB Asia ex Partnerships¹ ANZ 16#17Digital investment - delivering results Australia Sales numbers via Digital¹ (%) Transaction numbers via Digital² (%) 14.4% 73.9% 70.4% 9.5% ANZ Smart Choice 1486 Online rollover innovation released 775 3,404 1,619 435 Mar 13 Mar 14 Mar 15 1H14 1H15 1H14 1H15 FUM ($m) Ave Weekly Rollovers New Zealand Transactive Mobile A$b Sales revenue via Digital³ (%) Transaction numbers via Digital² (%) k 60 7,000 65.0% 50 6,000 5,000 40 7.6% 6.6% 59.1% 4,000 30 $55 3,000 20 $37 2,000 10 $0 $20 1,000 0 0 FY12 FY13 FY14 FY15x4 1H14 1H15 1H14 1H15 Value Volume (RHS) 1. 2. 3. 4. Sales includes the number of sales events through the Retail distribution network, including all Retail, Commercial and Wealth products. Transactions refers to the number of value transactions through all channels including internet, mobile, teller and ATM. Revenue from sales completed through Digital channels. Determined by annualised calculation of available data as at Feb 15. ANZ 17#18ANZ Green Bonds Investor Presentation 1H15 Result Overview ANZ#191H15 result overview Group 1H15 1H14 PCP AUDM AUDM % / bps Net interest income Other operating income Operating income Expenses 7,138 6,764 6% 3,047 2,904 5% 10,185 9,668 5% (4,593) (4,286) 7% PBP 5,592 5,382 4% Impairment charge (510) (528) (3%) Tax and non-controlling interests (1,406) (1,339) 5% Cash Profit 3,676 3,515 5% Stat. adjustments¹ (170) (123) 38% Statutory Profit 3,506 3,392 3% Net interest margin 2.04% 2.15% (11 bps) Net interest margin (ex Markets) 2.51% 2.55% (4 bps) Cost to income ratio 45.1% 44.3% 80 bps Impairment charge % avg GLA 0.19% 0.21% (2 bps) Return on equity 14.7% 15.5% (80 bps) Gross loans and advances 562,231 513,563 Customer deposits 436,147 388,022 APRA Basel III CET1 ratio Internationally Comparable Basel III CET1 ratio² 8.7% 12.4% 8.3% 9% 12% 40 bps 12.2% 20 bps All figures are presented on Cash basis in Australian Dollars unless otherwise noted. 1. In arriving at Cash Profit, Statutory Profit has been adjusted to exclude non-core items, further information is set out on page 86 of the 2015 Half Year Consolidated Financial Report. 2. Internationally Comparable methodology per Australian Bankers' Association: International comparability of capital ratios of Australia's major banks (August 2014). ANZ 19#201H15 result overview Australia 1H15 PCP AUDM % / bps Net interest income 3,670 7% • Other operating income 571 3% Operating income 4,241 6% • Expenses (1,556) 5% • PBP 2,685 6% Impairment charge (395) (2%) • Tax & Non-Controlling Interests (688) 8% Cash Profit after Tax 1,602 8% Drivers & outcomes Maintained margins in a competitive environment Invested in frontline, digital & NSW Small business lending up 15% 5 yrs above system mortgage growth ⚫ Best in class productivity Cash Profit & growth Net interest margin 2.50% 0 bps PCP 8% 8% 8% Cost to income ratio 36.7% (30 bps) $m 1,602 Net loans and advances 297,642 7% 956 Customer deposits 162,587 4% 646 Impairment charge % avg GLA 0.27% (2 bps) NPAT contribution Aus Div Aus Retail Aus Comm Retail 956 8% Corporate & Commercial Banking 646 8% ANZ 20#211H15 result overview New Zealand 1H15 PCP NZDm % / bps Net interest income 1,241 6% Other operating income 196 1% Operating income 1,437 6% • Expenses (576) 2% PBP 861 8% Impairment charge (20) large • Tax & Non-Controlling Interests (236) 0% Cash Profit after Tax 605 1% • Drivers & outcomes PBP up 6% in Retail & up 9% in Commercial Winning customers: #1 Mkt position & growing mortgage & cards share Invested in Auckland, Christchurch & small business Continuing strong credit quality Net interest margin 2.52% 3 bps Cost to income ratio 40.1% (120 bps) Productivity & Efficiency Net loans and advances 99,518 6% CTI Rev per FTE (RHS) Customer deposits 61,427 11% NZ$k 45.2% 300 Impairment charge % avg GLA 0.04% 12 bps 41.3% 200 40.1% NPAT contribution 100 Retail 238 4% 0 Corporate & Commercial Banking 368 -2% 1H13 1H14 1H15 ANZ 21#221H15 result overview International & Institutional Banking 1H15 PCP AUDM % / bps Net interest income 2,027 2% Other operating income 1,759 8% Operating income 3,786 5% Expenses (1,771) 9% PBP 2,015 1% Impairment charge (98) (40%) Cash Profit 1,459 7% Net interest margin 1.34% (21 bps) • • Drivers & outcomes 49% of markets income from APEA; driving IIB Asia growth of ~15% APEA represents over half of IIB's NPAT $1 of trade income generating $1.40 of cross sell into markets and cash2 #4 Corporate Bank in Asia³ Net interest margin (ex Global Markets) 2.32% (19 bps) Cost to income ratio 46.8% 190 bps Growing higher ROE businesses4 Net loans and advances 156,517 15% $m 2,966 2,992 Customer deposits 201,124 17% 361 356 12% 12% Impairment charge % avg GLA 0.13% (11 bps) 877 845 28% 30% NPAT contribution¹ 500 549 18% Global Transaction Banking 305 38% 17% Higher ROE Global Loans and Advisory 394 (9%) 1,228 1,242 42% 41% Global Markets 421 (7%) Asia Partnerships 299 24% 1H14 1H15 ■Markets ■Cash ■Global Loans ■Trade Retail Asia Pacific 56 24% 1. Excluding Central Functions. 2. Cross-sell multiple based on a pool of customers that have a minimum of Trade, Markets and Cash Management with ANZ. 3. Greenwich Associates 2014 Asian Large Corporate Banking Study. 4. Excludes retail and partnerships. 22 ANZ#231H15 result overview Global Wealth 1H15 PCP AUDM % / bps Net interest income 88 10% Drivers & outcomes Wealth customers² Other operating income 97 (19%) m Net funds management & insurance income 665 10% +11% 2.1 Operating income 1.9 850 5% 1.6 Expenses (489) 1% PBP 361 12% Sep 13 Mar 14 Mar 15 Impairment charge 1 0% Retail Life lapse rates Tax & Non-Controlling Interests (103) 14% Cash Profit after Tax 259 11% Australia 13.3% 12.1% 11.6% Funds under Management In-force premiums Cost to income ratio NPAT contribution¹ Funds Management Insurance Private Wealth 1. Excluding Corporate and Other. 2. ANZ Wealth customers directed through ANZ channels. 3. Global Private Wealth and Funds Management net flows 68,405 11% 2,154 10% 57.5% (250 bps) 1H13 1H14 1H15 FUM net flows³ 883 78 20% $m 686 143 46% 43 (2%) (442) 1H13 1H14 1H15 ANZ 23#24Challenges and areas to improve Challenges/Areas to improve Expenses Drivers & outcomes Global liquidity squeezing loan margins, deferring benefit of Institutional cash build out • • +4% (ex FX) front running investment Targeting ~3% FY15 Building deposits faster Lifting cross-sell & key 'corridors' growth Managing returns, more balanced bank Trade pressured by commodity prices and lower hedge revenue Progress on structural realignment of the business Strong core business experiencing cyclical pressure Returns up despite tough conditions Esanda Dealer Finance sale RWA growth 7%, ~50% FX driven Disciplined capital management ANZ 24#25ANZ Green Bonds Investor Presentation Treasury ANZ#26Regulatory capital % Capital Update 1H15 organic capital generation¹ of 59 bps modestly above recent first half performance. APRA Common Equity Tier 1 ratio 8.7%. Target range for CET1 ratio remains around 9% on an APRA basis. Internationally Comparable2 CET1 ratio is ~3.7% higher than under APRA basis. Reflects variances between Basel III under APRA and Basel standards. 1.5% discount for 1H15 Dividend Reinvestment Plan aims to achieve ~20% participation on a full 12 month basis. This level of participation is consistent with average observed since 2012 and capital planning. Basel 3 Common Equity Tier 1 (CET1) 8.3% 12.2% 8.8% 12.7% 8.7% 12.4% APRA CET1 movement - Mar 15 v Sep 14 8.79 Mar 14 ■APRA Sep 14 Mar 15 Internationally Comparable 2 Total RWA movement - Mar 15 v Sep 14 1.02 $b 15.4 386.9 (0.22) 1.5 (0.21) 8.72 16.1 (0.7) (0.64) (0.02) (6.9) 361.5 Credit RWA +$30.8bn T Sep 14 Cash RWA NPAT 3 Usage 4 Capital Deductions 5 Net Dividend Other Mar 15 Sep 14 Growth FX Impact Other 6 Market & Op Risk Mar 15 IRRBB RWA RWA - 1. Organic capital generation = cash profit - RWA growth capital deductions. 2. Methodology per Australian Bankers' Association: International comparability of capital ratios of Australia's major banks (August 2014). March 2014 comparatives has been restated based on current methodology. 3. Cash profit net of preference share dividends. 4. Includes EL vs. EP shortfall. 5. Represents the movement in retained earnings in deconsolidated entities, capitalised software and other intangibles. 6. Other includes risk and portfolio data review impact. ANZ 26#27Internationally Comparable regulatory capital position CET1 Tier 1 Total Capital APRA 8.7% 10.6% 12.6% 10% 15% allowance for equity investments and DTA APRA requires 100% deduction from CET1 vs. Basel framework which allows concessional threshold prior to deduction 0.9% 0.9% 0.8% Mortgage 20% LGD floor APRA requires use of 20% mortgage LGD floor vs. 10% under Basel framework 0.4% 0.4% 0.5% IRRBB RWA (APRA Pillar 1 approach) APRA includes in Pillar 1 RWA. This is not required under the Basel framework 0.2% 0.2% 0.3% Specialised Lending (Advanced treatment) Corporate undrawn EAD and unsecured LGD adjustments APRA requires supervisory slotting approach which results in more conservative risk weights than under Basel framework 0.4% 0.4% 0.5% Australian ADI unsecured corporate lending LGDs and undrawn CCFs exceed those applied in many jurisdictions 1.5% 1.8% 2.0% Other Includes impact of deductions from CET1 for capitalised expenses and deferred fee income required by APRA 0.3% 0.4% 0.4% Internationally Comparable¹ 12.4% 14.7% 17.1% 1. Internationally Comparable methodology per Australian Bankers' Association: International comparability of capital ratios of Australia's major banks (August 2014). ANZ, 27#28ANZ's CET1 ratio compares favourably to global peers adjusting for regional methodology differences 8.7% Canada UK Singapore Europe +270bps +60bps +70bps +30bps 12.4% 12.5% 12.1% 11.5% 11.9% 11.4% 11.6% 10.9% 9.8% 1. Methodology per Australian Bankers' Association: International comparability of capital ratios of Australia's major banks (August 2014). 2. Peer estimates are based on RWA weighted average of G-SIB/D-SIBS (ex Singapore which is based on DBS and OCBC) fully loaded Basel III capital ratios per most recent disclosures. ANZ 28#29Common Equity Tier 1 ratio, dividend timing and regulatory capital generation APRA Basel III CET1 Ratio 9.0% 8.5% 8.0% 7.5% 7.0% Sep-12 Dec-12 Mar-13 Jun-13 Sep-13 Dec-13 Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Note: shaded quarters represent declaration of dividends. Basel III basis. Common Equity Tier 1 generation (bps) First half average 1H15 1H12- 1H14 Cash profit 102 102 RWA growth (29) (22) Capital deductions (18) (21) Net capital generation 55 59 Gross dividend (70) (72) Dividend Reinvestment 14 8 Plan Core change in CET1 capital ratio (1) (5) Other non-core and non- recurring items 11 (2) Under Basel III, dividends are only deducted from regulatory capital in the quarter in which they are declared. This results in volatility in quarterly reported capital ratios. To assess the underlying regulatory capital position, dividend payments should be adjusted to accrue evenly over the year, aligned with profit generation. Net change in CET1 capital ratio 10 (7) ANZ, 29#30Stable balance sheet composition Short Term $738bn $738bn - March 2015 Other ST Liabilities 4% Liquids 17% ST Funding 8% 29% A+3% Term Funding <12M 4% 30% A+3% Other Short Term Assets Other Customer & Trade 12% Deposits 14% Lending 69% 71% Δ -3% Long Term Fixed Assets & Other 2% Assets Stable Customer Deposits 50% 1 70% A-3% Term Funding >12M 12% SHE & Hybrids 8% Funding Structural funding position has remained stable with growth in short-term funding invested in liquids and other short-term assets Customer Deposits +$34bn or +8% vs. Sep 14 Note: A represents the change in % of funded balance sheet from 30 September 2014 to 31 March 2015. 1. Stable customer deposits represent operational type deposits or those sources from retail / business / corporate customers and the stable component of Other funding liabilities. ANZ30#31Term wholesale funding portfolio 24 16 Issuance¹ 26 24 24 Term Funding Profile $bn Maturities 11 23 21 Annual indicative issuance volume 16 12 10 10 Inill..im FY10 FY11 FY12 FY13 ■Senior Unsecured Portfolio by Type 7 FY14 1H15 2H15 FY16 FY17 Covered Bonds FY18 FY19 FY20 FY21+ ■Tier 2 Portfolio by Currency 9% 6% 8% 9% 8% 9% Government 18% 20% 13% 18% Guaranteed ■Tier 2 24% Covered Bonds 74% 69% 68% 71% ■Senior Unsecured Sep 12 Sep 13 Sep 14 Mar 15 1% 6% 35% 34% ■Domestic (AUD,NZD) North America (USD, CAD) ■UK & Europe (€,£,CHF) Asia (JPY, HKD, SGD, CNY) Other All figures based on historical FX and excludes hybrids. 1. Includes transactions with a call or maturity date greater than 12 months as at 30 September in the respective year of issuance. ANZ 31#32Liquidity management successfully transitioned to LCR Date Sep 14 LCR LCR Surplus $b 111% $15bn Mar 15 119% $28bn 173 17 150 145 17 135 49 24 49 49 3 81 19 116 121 104 HQLA 1 HQLA 2 Liquid Assets 1 1. Post haircut market value as defined in APS210. 2. 1H15 includes $54bn Committed Liquidity Facility. 3. Basel III LCR 30 day stress scenario cash outflows. 4. Other include off-balance sheet and cash inflows. Net Cash Outflows 3 Internal RMBS Other Alternative Liquid Assets Liquid Assets 1, 2 Net Cash Outflows 3 Customer deposits and other4 Wholesale funding ANZ 32#33Regulatory landscape Capital Funding Other Leverage ratio Level 3 capital adequacy "Conglomerates" Basel Standardised and floors Total Loss Absorbing Capacity (TLAC) Liquidity Coverage Ratio Net Stable Funding Ratio Financial System Inquiry Status • APRA draft standard Sep 2014 No minimum currently specified, BCBS 3% APRA draft Level 3 standards Aug 2014 Finalisation and implementation deferred until Financial System Inquiry recommendations considered by government/APRA BCBS consultation papers released Dec 2014 propose changes to Standardised risk weights, introduction of Advanced approach capital floors Financial Stability Board proposal released Nov 2014 details minimum TLAC requirements for G-SIBS • Full implementation from Jan 2015 Disclosure timetable to be determined by APRA • BCBS standard Jan 2014 APRA standard yet to be finalised, expected implementation 2018 Key recommendations to government: • Set standards such that Australian ADI capital ratios are unquestionably strong Raise Advanced IRB mortgage risk weights to narrow difference with Standardised approach Implement loss absorption and recapitalisation framework in-line with international practice Introduce Basel framework leverage ratio Final round consultation closed 31 March 2015 ANZ's position Leverage ratio 4.5-5.5% at 1H15 depending on final calibration No material impact expected based on current draft standards ANZ has participated in BCBS QIS. Impact of any changes subject to final BCBS calibration and APRA implementation. Proposal currently does not apply to D-SIBS. If applied to ANZ, wide range of outcomes depending on calibration including basis for measuring capital base, D-SIB minimum etc Full compliance at 1H15 (LCR 119%) Do not expect NSFR to require any material change to balance sheet composition Refer to ANZ's submission on the Final Report of the Financial System Inquiry published 1 April 2015 ANZ 33#34ANZ Green Bonds Investor Presentation Credit Quality ANZ#35Credit quality - Group Group overview Credit impairment charge % average GLA (Group) Individual provisions % gross impaired assets (Group) 1H15 0.19% 2H14 1H14 0.17% 0.21% 41.1% 40.7% 40.6% Collective provisions % credit RWA (Group) 0.86% 0.89% 0.93% Gross impaired assets % GLA (Group) 0.48% 0.55% 0.70% Net impaired assets % shareholders' equity (Group) 3.1% 3.5% 4.6% Control list limits (YoY % change; Group) (22%) (27%) (25%) Australia housing 90 days past due 1,2 0.57% 0.48% 0.53% Australia C&CB 90 days past due³ 1.04% 0.86% 0.86% Credit impairment charge % average GLA Gross Impaired Assets % GLA 0.40% 1.20% 0.30% 1.00% 0.80% 0.20% 0.60% 0.10% 0.40% 0.00% 0.20% Australia New Zealand IIB 0.00% -0.10% Australia New Zealand IIB 1H14 ■ 2H14 1H15 1H14 ■ 2H14 ■ 1H15 1. Exclusive of Non Performing Loans. 2. Hardship changes implemented Apr 2013. For comparison: 90+ excluding hardship changes as at Mar 2015 is 0.46%. 3. Includes Small Business, Commercial Cards and Esanda Retail. ANZ 35#36Impaired Assets Control list New impaired assets by division Index Sep 09 = 100 $m 2,000 1,716 120 1,800 1,571 1,541 1,600 1,327 100 1,400 1,197 1,200 80 1,000 800 60 600 40 400 200 20 Sep 09 Sep 10 Sep 11 Control List by Limits Sep 12 Sep 13 Sep 14 Control List by No of Groups 1H13 2H13 1H14 2H14 1H15 ■IIB ■ Other Gross impaired assets by size of exposure ■Australia ■New Zealand Impaired assets concentration by number of customers¹ $m 5,000 4,685 4,264 3% 3% 3% 3% 5% 5% 8% 9% 11% 8% 11% 16% 4,000 3,620 2,889 3,000 2,708 2,000 83% 88% 84% 84% 76% 1,000 0 Mar 13 Sep 13 ■ < $10m Mar 14 Sep 14 ■ $10-$100m Mar 15 ■> $100m Mar 13 ■ $10-50m Sep 13 ■ $51-100m Mar 14 Sep 14 Mar 15 ■ $101-200m ■>$200m 1. Only $10m customers. ANZ 36#37Provision Charge Provision charge Individual provision charge composition $m $m 700 599 598 510 1,500 528 461 1,250 500 595 572 602 542 1,000 455 0.27% 300 0.24% 0.24% 750 0.20% 0.17% 500 100 250 -100 1H13 2H13 1H14 ■Individual Provision (IP) Charge Collective Provision (CP) Charge IP Charge as % Avg. GLA Individual provision charge by segment 2H14 1H15 -250 -500 1H13 2H13 1H14 2H14 1H15 ■New ■Increased ■Writebacks & Recoveries Individual provision charge by region $m 700 $m 700 595 572 602 595 602 600 572 542 600 542 15% 500 455 500 16% 21% 9% 455 50% 50% 10% 8% 3% 10% 400 58% 10% 400 8% 68% 300 63% 300 26% 21% 200 200 75% 76% 76% 81% 82% 26% 17% 100 24% 29% 26% 100 16% 20% 6% 0 1H13 2H13 1H14 2H14 1H15 1H13 2H13 1H14 2H14 1H15 ■Institutional ■Commercial ■Consumer ■Australia ■New Zealand APEA ANZ 37#38Collective Provision CP Balance Growth The collective provision balance increased by $157m in the first half of FY15, to $2,914m, predominantly driven by: Foreign exchange, particularly the depreciation of the AUD against the USD and against the NZD, which accounted for $102m, or 65%, of this increase Portfolio growth of $54m, specifically the Australia Division (67%), driven by the retail portfolios $m 2,757 Sep 14 Collective provision by division 61 (2) (3) (1) CP coverage $b 340 305 309 288 275 $m 102 2,914 1.01% 1.00% 0.93% 0.89% 0.86% Mar 13 Mar 14 Sep 14 Mar 15 Sep 13 Credit Risk Weighted Assets Collective Provision as a % of CRWA Collective provision by source 54 3 2,757 5 (7) 2,914 102 AUS IIB NZ Wealth & Other FX Movement Mar 15 Sep 14 Risk Lending Growth Portfolio Mix Mgmt. Overlay Fx movement Mar 15 ANZ 38#39Historical Loss bps EAD Group regulatory expected loss 75 69 19 61 62 Historical observed loss rates bps % 250 IP Loss Rate (LHS) 120 200 -Corporate Gearing lagged 15 months (RHS) 100 150 100 44 54 50 Mar 11 Mar 12 Mar 13 Mar 14 Mar 15 80 60 60 60 40 40 20 20 0 Sep 90 Sep 94 Sep 98 Sep 02 Sep 06 Sep 10 Sep 14 • • Corporate gearing remains low Corporate gearing ratios¹ were compared with the Group IP loss rates from 1990. Lagging corporate gearing 15 months provides a reasonably strong relationship, with corporate gearing a leading indicator of loss Current IP loss rate (annualised) as at Mar'15 was 17bps which is similar to that observed between 2005 and 2007 The annualised 1H15 IP loss rate (17 bps) is the 6th lowest rate over the time period analysed since 1990 1. Debt to equity ratios for listed Australian Corporations sourced from the RBA. ANZ 39#40Portfolio composition Exposure at default (EAD) as a % of Group total ANZ Group Total Group EAD (Mar 15) Category % of Group EAD % of Portfolio in Non in Non Performing Performing Portfolio Balance Mar 14 Mar 15 Mar 14 Mar 15 Mar 15 Consumer Lending 40.3% 38.2% 0.2% 0.2% $608m $869b¹ Finance, Investment & Insurance 16.4% 18.7% 0.1% 0.1% $93m Property Services 7.0% 6.8% 1.7% 1.3% $757m 2% 2% 2% 6% 2% 2% 3% 4% 4% 4% Manufacturing 6.1% 6.5% 0.6% 0.5% $297m Agriculture, Forestry, Fishing 4.2% 3.9% % 3. 3.5% 2.1% $728m Government & Official 38% 3.8% 4.4% 0.0% 0.0% $0m Institutions Wholesale trade 3.9% 4.0% % 0. 0.6% 0.4% $154m Retail Trade 2.7% 2.6% 0.6% 0.4% $101m Transport & Storage 2.4% 2.2% % 3.0 3.0% 1.3% $257m 6% 7% Business Services 1.9% 1.8% 1.3% 0.9% $151m 19% Resources (Mining) 2.3% 2.2% % 0. 0.7% 0.5% $97m Electricity, Gas & Water Supply 1.7% 1.6% 0.1% 0.1% $10m Construction 1.6% 1.6% 1.9% 1.7% $240m Other 5.7% 5.5% 0.6% 0.5% $220m 1. EAD excludes amounts for 'Securitisation' and 'Other Assets' Basel asset classes. ANZ 40#41Australia Division Australia Division credit exposure (EAD) 1% .0% ■Home Loans Corporate and Commercial Consumer Cards 24% Personal Loans ■ Other 2% 6% Australia Home Loans 90+ day delinquencies by state¹ ■Mar 12 ■Mar 13 ■Mar 14 ■Mar 15 1.0% 0.8% 0.6% 0.4% 69% 0.2% 0.0% VIC NSW & ACT QLD WA Portfolio Australia Division 90+ day delinquencies¹ Home Loans (inclusive of hardship change) 2 3 Corporate & Commercial Banking Consumer Cards 1% 0% Oct 10 Oct 11 Oct 12 Oct 13 Oct 14 Australia Home Loans portfolio by state¹ Mar 15 29.4% 27.0% 17.7% 16.2% 9.7% 1.08% 1.04% Mar 14 29.1% 26.2% 18.2% 16.5% 9.8% 0.57% 0% 25% 50% 75% 100% ■ VIC NSW & ACT ■ QLD ■WA ■ Other 1. Exclusive of Non Performing Loans. 2. Hardship changes implemented Apr 2013. For comparison: 90+ excluding hardship changes as at Mar 2015 is 0.46%. 3. Includes Small Business, Commercial Cards and Esanda Retail. ANZ 41#42Australia Home Loans portfolio Portfolio statistics¹ Dynamic loan to value ratio5 % of Portfolio Statistics 1H15 FY14 1H14 50% 45% Total Number of Home Loan 934k 919k 903k Accounts 40% 35% ■Sep 12 ■Mar 13 ■Sep 13 ■Mar 14 Total Home Loans FUM $218b $209b $202b 30% ■Sep 14 ■Mar 15 % of Total Australia Geography 25% 60% 60% 59% Lending 20% LVR >90% 15% % of Total Group Lending 39% 40% 39% 10% 4% (Mar 15)⁹ Owner Occupied Loans - % of 5% 60% Portfolio² 61% 61% 0% 0-60% 61-75% 76-80% 81-90% 91-95% 95%+ Average Loan Size at Origination (FY14 / 1H15 average) 3,4 $376k $352k $345k Average LVR at Origination (FY14/ 1H15 average) 3,4,5 Individual provision as % of average NLA 71% 71% 71% FY12 FY13 FY14 1H15 Average Dynamic LVR of Portfolio 4,5,6 51% 50% 50% Group 0.38% 0.25% 0.22% 0.17% % of Portfolio Ahead on Repayments 7,8 43% 45% 47% Australia Home Loans 0.02% 0.02% 0.01% 0.01% % of Portfolio Paying Interest 35% 34% Only8 33% 1. Home Loans (inclusive of NPLs, exclusive of offset balances). 2. Excludes Equity Manager. 3. Originated 1H15. 4. Unweighted. 5. Including capitalised premiums. 6. Valuations updated at reporting period end where available. 7. % of customers >30 days ahead of repayments. 8. Excludes revolving credit. 9. Excluding capitalised premiums, the % of portfolio with LVR >90% as at Sep 2014 is 2.35% (Mar ANZ 2015 was 2.6%) 42#43New Zealand mortgages portfolio Portfolio statistics Dynamic loan to value ratio % of Portfolio Statistics 1H15 FY14 1H14 60% ■Mar 14 Total Number of Mortgage Accounts 494k 488k 484k 50% ■Sep 14 Total Mortgage FUM (NZD) $64b $62b $61b 40% ■Mar 15 % of Total New Zealand Lending 59% 58% 59% 30% % of Total Group Lending¹ 11% 11% 11% 20% LVR >90% 6% (Mar 15) Owner Occupied Loans - % of 75% 76% 76% Portfolio 10% Average Loan Size at $289k $266k $254k Origination (NZD) 0% 0-60% 61-70% 71-80% 81-90% 90%+ Average LVR at Origination² 64% 63% 63% Individual provision as % of average NLA Average Dynamic LVR of Portfolio³ 49% 50% 46% FY12 FY13 FY14 1H15 % of Portfolio Paying Interest Only4 22% 22% 21% Group¹ 0.38% 0.25% 0.22% 0.17% New Zealand Mortgages5 0.07% 0.04% 0.06% 0.01% 1. As % of group average NLA. 2. Average LVR at Origination (not weighted by balance). 3. Average dynamic LVR as at (not weighted by balance) - Dynamic LVR graph as at Feb 2014 for 1H14, Aug 2014 for FY14 and Feb 2015 for 1H15 respectively. 4. Excludes revolving credit facilities. 5. Individual Provision as % average NLA. ANZ 43#44New Zealand NZ Geography net impaired assets NZ Geography total provision charge NZDm NZDm 105 200 85 1,685 Net Impaired Assets NIA as % GLA (RHS) 150 103 99 100 44 22 30 50 (39) 31 0 1,307 -50 1,169 -100 1.74% 1.38% 1.23% 991 883 1.02% 0.89% 662 594 483 1.5% 1.0% 1H11 2H11 1H12 2H12 1H13 2H13 1H14 2H14 1H15 ■IP Charge ■CP Charge NZ Division 90+ days delinquencies 0.66% 322 0.5% 0.58% 0.46% 0.0% 0.29% Sep 07 Mar 11 Sep 11 Mar 12 Sep 12 Mar 13 Sep 13 Mar 14 Sep 14 Mar 15 Sep 09 Sep 11 Sep 13 Home Loans Commercial Agri ANZ 44#45Resources Portfolio Resources exposure by sector (% EAD) Resources exposure credit quality by geography (EAD) Total EAD (Mar 15) $19.5b As a % of Group EAD 2.2% AUS ($b) NZ ($b) ASIA ($b) EA & Other ($b) 9.8 0.9 4.3 4.5 Oil & Gas Metal Ore Mining 14% Coal Mining 16% Services To Mining 15% 16% 23% 23% 6% Other Mining 6% ■1H15 ■1H14 9% 24% 22% 42% 49% 39% 91% 76% 78% 51% AUS NZ Investment Grade ASIA OTHER ■Sub-Investment Grade Resources portfolio management Portfolio is skewed towards well capitalised and lower cost resource producers. Over a third of the book is less than one year duration. Investment grade exposures represent 67% of portfolio. Mix of investment grade exposures in portfolio has increased across all geographies in 1H15. • Trade accounts for 21% of the Total Resources EAD. Mining services customers are subject to heightened oversight given the cautious outlook for services sector. ANZ 45#46Agri portfolio Agriculture exposure by sector (% EAD) Total EAD (Mar 15) ■Dairy $34.0b ■ Beef ■Sheep & Other Livestock ■Grain/Wheat ■Horticulture/Fruit/Other Crops ■Forestry & Fishing/Agriculture Services 61% 1% 38% As a % of Group EAD NZ$ b 3.9% 14% New Zealand Agri credit quality 21 19 18 2.11% 17 18 18 10% 1.55% 1.23% 1 0.94% 0.96% 0.81% 40% 16% 11% 9% Sep 10 Sep 11 Sep 12 Sep 13 Sep 14 Mar 15 INZD Total Credit Exposure Average PD (Non-Defaulted Customers) 1 Group Agriculture EAD splits 2% 98% 5% 7% 17% 71% <60% Secured ■60-80% Secured ■Australia New Zealand Int Markets ■Productive ■Impaired ■ 80 - <100% Secured Fully Secured 1. PD model changes account for 11bps increase in 1H15. ANZ 46#47Commercial property portfolio $b Commercial Property outstandings by region¹ Commercial Property outstandings by sector¹ 8.0% 35.5 34.4 33.9 32.0 4.6 7.5% 30.6 4.5 4.1 30% 4.1 4.0 7.8 7.0% 6.1 6.9 6.9 5.4 6.5% 26% ■ Offices 4% 3% 15% ■Retail ■Residential 22% ■Industrial ■Tourism Other Property peer comparison² 6.0% $m ANZ Peer 1 Peer 2 Peer 3 23.0 22.9 23.1 21.2 21.8 Property Portfolio EAD 51,039 68,739 72,935 57,994 5.5% 5.0% Mar 13 Sep 13 Mar 14 Sep 14 Dec 14 Australia New Zealand APEA % of Group GLA's (RHS) Property EAD Growth Rates Property EAD/Total EAD Impaired Assets Property Impaired Assets/Property EAD 7.9% (1.6%) 13.9% 7.0% 5.73% 7.57% 8.50% 6.42% 424 1,497 726 318 0.83% 2.18% 1.00% 0.55% 1. As per ARF230 disclosure. 2. As per APS330 disclosure. ANZ includes property services, not consistent across peers. ANZ 47#48Risk Weighted Assets $b Total RWA 361 362 53 56 387 47 $b CRWA growth $b Group EAD & CRWAS 891 813 779 741 692 30.8 1.7 Other 39.8% 38.9% 39.2% 38.0% 38.1% 16.1 Lending growth 15.4 FX 340 -2.4 Risk $b 305 309 1H15 Mar 14 Sep 14 Mar 15 ■Credit RWAS ■Market & Operational RWAS change HoH +4.7% (FX adjusted) Mar 13 Sep 13 Exposure at Default Mar 14 Sep 14 CRWA / EAD Mar 15 CRWA movement - Mar 15 v Sep 14 308.9 Sep 14 (2.4) Risk 339.7 15.4 1.7 16.1 ek ANZ 48#49Key Treasury Contacts Australia and New Zealand Banking Group Limited Level 9, 833 Collins Street Docklands VIC 3008 Australia Group Treasurer Rick Moscati Phone +61 (3) 8654 5404 Mobile: +61 (0) 412 809 814 E-mail: Rick. [email protected] Head of Debt Investor Relations Andrew Minton Phone: +61 (3) 8655 9029 Mobile: +61 (0) 413 019 633 E-mail: [email protected] Head of Group Funding Luke Davidson Phone: +61 (3) 8654 5140 Mobile: +61 (0) 413 019 349 E-mail: Luke. [email protected] For further information, please visit our website: www.anz.com ANZ 49#50Important notices The distribution of this document in certain jurisdictions may be restricted by law and persons into whose possession any document or other information referred to herein comes should inform themselves about and observe any such restrictions. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction. This document (and its presentation) does not constitute or form part of and should not be construed as, an offer to sell or issue or the solicitation of an offer to buy or acquire notes or securities (together, the "Securities") of Australia and New Zealand Banking Group Limited (the "Bank") or any of its subsidiaries or affiliates in any jurisdiction or an inducement to enter into investment activity. In particular, this document and the information contained herein are not an offer of the Securities for sale in the United States and are not for publication or distribution to persons in the United States. The document is being given to you on the basis that you have confirmed your representation that you are not located or resident in the United States and, to the extent you purchase the Securities described herein you will be doing so pursuant to Regulation S under the U.S. Securities Act of 1933, as amended (the "Securities Act"). THE SECURITIES HAVE NOT BEEN, AND WILL NOT BE, REGISTERED UNDER THE SECURITIES ACT, OR THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR OTHER JURISDICTION AND MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES, EXCEPT IN CERTAIN TRANSACTIONS EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. ANY INVESTMENT DECISION TO PURCHASE SECURITIES IN THE CONTEXT OF A PROPOSED OFFERING, IF ANY, SHOULD BE MADE ON THE BASIS OF THE FINAL TERMS AND CONDITIONS OF THE SECURITIES AND THE INFORMATION CONTAINED IN THE OFFERING CIRCULAR PUBLISHED IN RELATION TO SUCH AN OFFERING AND NOT ON THE BASIS OF THIS DOCUMENT WHICH DOES NOT CONSTITUTE OR FORM PART OF AN OFFER OR SOLICITATION OF AN OFFER TO PURCHASE OR SUBSCRIBE FOR ANY SECURITIES IN THE UNITED STATES OR ANYWHERE ELSE. No part of this document, nor the fact of its distribution, should form the basis of, or be relied on in connection with, any contract or commitment or investment decision whatsoever. No representation, warranty or undertaking, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information or the opinions contained herein. 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In particular, this document may not be taken or transmitted into the United States, Canada, Japan, the United Kingdom or Australia or distributed, directly or indirectly, in the United States (including its territories and possessions, any state of the United States and the District of Columbia), Canada, Japan, the United Kingdom or Australia. 50 ANZ#51Important notices This document contains "forward-looking statements", which include all statements other than statements of historical facts, including, without limitation, any statements preceded by, followed by or that include the words "targets", "believes", "expects", "aims", "intends", "will", "may", "anticipates", "would", "could" or similar expressions or the negative thereof. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors beyond the Bank's control that could cause the actual results, performance or achievements of the Bank to be materially different from future results, performance or achievements expressed or implied by such forward- looking statements. Neither the Bank, nor any of its agents, employees or advisors intends or has any duty or obligation to supplement, amend, update or revise any of the forward-looking statements contained in this document. Any Securities or strategies mentioned herein may not be suitable for all investors. Investors and prospective investors in Securities mentioned herein are required to make their own independent investigation and appraisal of the business and financial condition of the Bank, the nature of the Securities and any tax, legal, accounting and economic considerations relevant to the purchase of the Securities. This document contains data sourced from and the views of independent third parties such as the Australian Prudential Regulation Authority, the Reserve Bank of Australia and the Reserve Bank of New Zealand. In replicating such data in this document, the Bank makes no representation, whether express or implied, as to the accuracy of such data. The replication of any views in this document should be not treated as an indication that the Bank agrees with or concurs with such views. This document is only directed at, and may be communicated to persons who are required to pay at least A$500,000 for the Securities (disregarding amounts, if any, lent by the Issuer or other person offering the Securities or its associates (within the meaning of those expression in Part 6D.2 of the Corporations Act 2001 of Australia (the Corporations Act)) or where by virtue of section 708 of the Corporations Act no disclosure is required to be made under Part 6D.2 of the Corporations Act and the offeree is not a retail client (as defined in section 761G of the Corporations Act). The information contained in this document is provided as at the date of this document and is subject to change without notice. 54 51 ANZ#52Important notices The certification of the ANZ Green Bond as Climate Bond by the Climate Bond Initiative is based solely on the Climate Bond Standard and does not, and is not intended to, make any representation or give any assurance with respect to any other matter relating to the ANZ Green Bond or any of the loan assets in respect of which the ANZ Green Bond is issued ("Nominated Projects"), including but not limited to information provided to potential Bond holders, the transaction documents, the Issuer or the management of the Issuer. The certification of the ANZ Green Bond as Climate Bond by the Climate Bond Initiative was addressed solely to the board of directors of the Issuer and is not a recommendation to any person to purchase, hold or sell the ANZ Green Bond and such certification does not address the market price or suitability of the ANZ Green Bond for a particular investor. The certification also does not address the merits of the decision by the Issuer or any third party to participate in any Nominated Project and does not express and should not be deemed to be an expression of an opinion as to the Issuer or any aspect of any Nominated Project (including but not limited to the financial viability of any Nominated Project) other than with respect to compliance with the Climate Bond Standard. In issuing or monitoring, as applicable, the certification, the Climate Bond Initiative has assumed and relied upon and will assume and rely upon the accuracy and completeness in all material respects of the information supplied or otherwise made available to the Climate Bond Initiative. The Climate Bond Initiative does not assume or accept any responsibility to any person for independently verifying (and it has not verified) such information or to undertake (and it has not undertaken) any independent evaluation of any Nominated Project or the Issuer. In addition, the Climate Bond Initiative does not assume any obligation to conduct (and it has not conducted) any physical inspection of any Nominated Project. The certification may only be used with the [Bond] and may not be used for any other purpose without the Climate Bond Initiative's prior written consent. The certification does not and is not in any way intended to address the likelihood of timely payment of interest when due on the [Bond] and/or the payment of principal at maturity or any other date. The certification may be withdrawn at any time in the Climate Bond Initiative's sole and absolute discretion and there can be no assurance that such certification will not be withdrawn. 62 52 ANZ