ANZ Financial Performance Overview

SECTION 4 Capital targets reduced, reflecting lower risk Drivers of ACE ratio • • Net impact of FX rate movements on ACE capital was approximately -$235 million. FX impact on RWA was approx -$3.2bn down due to FX rate movements, again principally the US$ depreciation (US$ accounted for -$3.3bn of the movement). % Earnings Dividend 7.50- 1.59 (1.02) 7.25 7.00 • Net impact on ACE ratio due to FX movement was +2bpts. 6.75 6.50 Our target ACE capital range has been lowered to 4.75% to 5.25% to recognise: 6.25 Other (0.12) RWA growth (0.43) Continued reduction in risk as evidenced by growth in the 6.00 proportion of residential mortgage lending and reduction in offshore lending 5.71 5.70 5.75 5.50 Acquisition of NBNZ which further diversifies our income and has a 5.25 lower risk lending book 5.00 ~5% Target range 4.75 4.50 Sep-02 Sep-03 NBNZ Pro Forma 32 ANZ

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