Investor Presentaiton

Appendix 1: Cash earnings adjustments. Cash earnings adjustment ($m) 1H20 2H20 1H21 Description Reported net profit 1,190 1,100 3,443 Net profit attributable to owners of Westpac Banking Corporation Fair value (gain)/loss on (219) 581 48 economic hedges Ineffective hedges (24) (37) 46 Adjustments related to 63 (32) Pendal Group Treasury shares (17) 3 Cash earnings 993 1,615 3,537 109 Appendix Fair value on economic hedges (which do not qualify for hedge accounting under AAS) comprise: The unrealised fair value (gain)/loss on foreign exchange hedges of future New Zealand earnings impacting non- interest income is reversed in deriving cash earnings as they may create a material timing difference on reported results but do not affect the Group's cash earnings over the life of the hedge. Westpac has ceased this activity, and at this stage no further adjustments will be recognised; and The unrealised fair value (gain)/loss on hedges of accrual accounted term funding transactions are reversed in deriving cash earnings as they may create a material timing difference on reported results but do not affect the Group's cash earnings over the life of the hedge The unrealised (gain)/loss on ineffective hedges is reversed in deriving cash earnings because the gain or loss arising from the fair value movement in these hedges reverses over time and does not affect the Group's profits over time Consistent with prior periods, this item has been treated as a cash earnings adjustment given its size and that it does not reflect ongoing operations. The adjustment relates to the mark-to-market of the shares. Westpac disposed of its holdings in Full Year 2020. As a result, no further adjustments will be recognised Under AAS, Westpac shares held by the Group in the managed funds and life businesses are deemed to be Treasury shares and the results of holding these shares cannot be recognised in the reported results. In deriving cash earnings, these results are included to ensure there is no asymmetrical impact on the Group's profits because the Treasury shares support policyholder liabilities and equity derivative transactions which are revalued in determining income. At 31 March 2021, there are no Treasury shares Westpac Group 2021 Interim Results Presentation & Investor Discussion Pack Westpac GROUP

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