Investor Presentaiton

12 ASSET QUALITY REMAINS SOUND B&DDS AND AS A % OF GLAS ($m) 90+ DPD & GIAS, AND WATCH LOANS AS A % OF GLAS 0.16% 0.12% 0.13% 0.14% 0.16% 1.11% 0.77% 0.63% 0.78% 0.85% 399 425 349 299 49 100 53 1.47% 349 350 296 375 325 1.16% 1.22% 1.15% 1.13% (50) Sep 14 Mar 15 Sep 15 Mar 16 B&DD charge CP Overlays B&DDS as a % of GLAS (annualised) Sep 16 Sep 14 Mar 15 Sep 15 Watch loans as % of GLAS Mar 16 Sep 16 90+ DPD & GIAS as a % of GLAS NEW IMPAIRED ASSETS ($m) 1,246 Sep 14 642 Mar 15 ■New impaired assets 570 Sep 15 AUSTRALIAN BUSINESS LENDING RISK PROFILE 15.8% 12.8% 11.7% 11.7% 11.4% 11.3% 11.6% 11.5% 1,291 1,046 522 27% 26% 300 22% 20% 16% 14% 769 14% 746 13% Mar 16 Sep 16 Sep 09 Sep 10 Sep 11 Sep 12 Sep 13 Sep 14 Sep 15 Sep 16 NZ Dairy impaired no loss' (1) NZ Banking dairy exposures currently assessed as no loss based on collective provisions and security held COLLECTIVE AND SPECIFIC PROVISIONS COLLECTIVE AND SPECIFIC PROVISIONS Australian business exposures by probability of default > 2% Australian CRE as % Australian GLAS COLLECTIVE PROVISION MOVEMENTS ($m) ($m) 3,610 3,502 3,580 3,523 700 448 602 712 3,054 2,910 2,978 2,811 2,978 Mar 15 Sep 15 ■Collective provisions SPECIFIC PROVISION COVERAGE 39 (188) 100 (63) (55) National Australia Bank 2,811 Mar 16 Overlays Mar 16 Specific provisions Sep 16 Volume and Transfer to credit specific quality provisions CP on derivatives UK CRE sale 1 Sep 16 and loans at fair value COLLECTIVE PROVISION COVERAGE AS % OF EXPOSURE³ 12.9% 45% 40% 11.4% 35% Illustrative example only for large corporate exposures prior to the point of impairment 30% 25% 51.2% 20% 38.3% 15% 26.9% 10% 5% Specific provisions as % of GIAS, NZ Dairy impaired no loss (incl. no loss)² loans Specific provisions as % of GIAS (excl no loss)² Partial write-offs Specific provisions 0% & Partial Write-Offs as % of GIAS (excl. no loss)² Increase in expected loss as credit deteriorates Unsecured -Fully secured 13 (1) A $55m benefit from the sale of a parcel of UK CRE loans was fully offset with other movements in the balance sheet including the de-recognition of loans and advances and the receivable on the consideration of the sale of the portfolio which results in a nil impact to cash earnings (2) Balances currently assessed as 'impaired no loss' are excluded from the reported specific provision coverage ratio of 38.3% as no specific provisions are held against these balances. Provisions associated with 'impaired no loss' balances are included within collective provision and therefore not included in these ratios (3) Relates to large corporate exposure originated as investment grade. Includes migration from IFRS 9 Stage 1 to 2 followed by Stage 2 to 3. Also includes forward looking component of IFRS 9 41% 11% National Australia Bank

View entire presentation