ANZ Financial Performance Overview

SECTION 6 Basel II will provide some benefits, but adjustments expected for local market Change in RWA under Basel II¹ • QIS 3 results reflect the underlying QIS 3 results quality of ANZ's assets, and support % ANZ Advanced IRB ANZ's move to a lower ACE target range Aust Majors Average G10 major bank average 0 • Corporate portfolio in particular produces a RWA reduction consistent with lower levels of risk -10 -20 -13 • We do not expect that APRA or Ratings Agencies will allow Australian Major banks the full benefit of the potential capital relief available under Basel II -30 -40 -50 -43 -49 • Results reinforce why Australian banks have lower Tier 1 and ACE ratios -60 Note: 1. 2. 3. ANZ Regulatory Capital under Basel II by key asset class (calculated at 8% of risk weighted assets) The reduction in RWAs using Advanced IRB outcomes (excluding operational risk) when compared with current accord capital requirements can be used as an indicator of the relative riskiness of a bank's assets. RWA calculations were performed using the capital functions used in QIS 3.0 These may change upon the finalisation of Basel II These results exclude any impact from NBNZ Corporate (incl SMEs) Residential Mortgages 59 II Current Foundation Other Standardised ■ Advanced ANZ

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