Anz Group Holdings Limited · ASX:ANZ
Anz — Australia and New Zealand Banking Group — 1H11 Earnings Presentation
104 slides from Anz's earnings presentation, May 3, 2011
Slide 1: Half Year Results
For personal use only 11 HALF YEAR RESULTS AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED 3 May 2011 Results Presentation & Investor Discussion Pack
Slide 2: Mike Smith, Chief Executive Officer
For personal use only 11 HALF YEAR RESULTS AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED 3 May 2011 Mike Smith Chief Executive Officer
Slide 3: Overview of financial performance
Overview of financial performance For personal use only 1H11 Growth Growth AUDm vs 2H10 vs 1H10 Underlying Profit 2,818 3% 23% Revenue 8,430 3% 11% Expenses 3,821 3% 18% Provisions 660 (9%) (40%) Statutory Net Profit After Tax 2,664 3% 38% EPS (cents) 109.6 2% 20% 1H11 Franked Dividend (cents) 64 n/
Slide 4: Australia
Australia For personal use only 1H11 v 1H11 v Underlying profit growth (AUDm) 2H10 1H10 Australia Region 2% 15% Australia Division (6%) 5% 1H11 Growth v System HOH1 Retail revenue, lending and deposit growth HOH Rebased: 1H10 = 100 1.15 1.6x 1.10 1.2x 1.05 1.00 0.95 System Mortgages Household Deposi
Slide 5: New Zealand
New Zealand For personal use only 1H11 v 1H11 v Underlying profit growth (NZDm) 2H10 1H10 New Zealand Region 19% 63% New Zealand Businesses 20% large NZ Region revenue & expense NZ Businesses Pro forma growth (NZD) Revenue & Margins NZD m 1,500 2.50% 6% 6% 5%5% 4% 4% 1,200 2.40% 2% 900 2.30% 0% 600
Slide 6: Asia Pacific, Europe & America
Asia Pacific, Europe & America For personal use only 1H11 v 1H11 v Underlying profit growth (USDm) 2H10 1H10 Asia Pacific, Europe & America Region 11% 44% APEA lending and deposit APEA plus APEA sourced revenue growth HOH 18% of Group % 1H11 Group revenue 70% 62% 60% 50% 50% APEA sourced revenue 40%
Slide 7: Institutional
Institutional For personal use only 1H11 v 1H11 v Underlying profit growth (AUDm) 2H10 1H10 Institutional Division 10% 24% Growing and diversifying regional Increased connectivity client base driven revenue Geographic Mix of new clients won past 12 months 16% Australia Domestic Booked Cross 20% Asia
Slide 8: Funding and Capital
Funding and Capital For personal use only Strong Funding Composition Strong Capital Position Core Tier-1 Capital Ratio March 2011 12% 11% ~11.8% 17% 22% 6% 6% 5% 7% 15% ~9.5% 16% 15% 8.5% 14% 58% 60% 55% 50% 7% 8% 8% 8% Sep 08 Sep 09 Sep 10 Mar 11 Current APRA Basel III FSA Fully Aligned SHE & Hybri
Slide 9: Emerging differentiation
Emerging differentiation For personal use only • Super Regional strategy giving us greater exposure to Asia‟s growth • Building blocks in place via both acquisition and investment in capability • Developing stronger customer propositions • Driving productivity gains from our hubs • Integrating the S
Slide 10: Peter Marriott, Chief Financial Officer
For personal use only 11 HALF YEAR RESULTS AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED 3 May 2011 Peter Marriott Chief Financial Officer
Slide 11: First Half 2011 – The Numbers
First Half 2011 – The Numbers For personal use only $m Performance 2H10 v 1H11 62 116 2,818 87 151 2,727 2,664 154 2,576 Up 3% Up 3% 2H10 Non-Core 2H10 Profit Before Provisions Tax & OEI 1H11 Non-Core 1H11 Statutory Items Underlying Provisions Underlying Items Statutory Profit Profit profit Profit 1
Slide 12: Adjust for acquisitions & FX – The Pro forma Numbers
Adjust for acquisitions & FX – The Pro forma Numbers For personal use only Growth 1H11 v 2H10 – Underlying & Pro forma Profit before Revenue Expenses Net Profit after Tax Provisions 5.5% 4.1% 4.1% 4.1% 3.4% 2.6% 2.6% 2.7% Underlying Pro Forma Underlying Pro Forma Underlying Pro Forma Underlying Pro
Slide 13: Foreign Exchange impacts
Foreign Exchange impacts For personal use only Earnings Composition by Region Earnings Per Share Impact & Average Translation Rates % Group Underlying profit Current Hedging Unhedged 100% 1.40 ~(3.1%) 90% 1.30 80% 1.20 (2.5%) 70% 60% 1.10 (1.9%) 50% 1.00 ~(1.5%) 40% 0.90 30% 0.80 20% 10% 0.70 0% 0.6
Slide 14: Divisional overview
Divisional overview For personal use only Profit Before Provisions (Pro forma) 1H11 HOH PCP Australia Division (AUD) 2,312 4% 5% APEA (USD) 538 25% 20% NZ Businesses (NZD) 738 6% 14% Institutional (AUD) 1,591 2% 1% Underlying Profit (Pro forma) 1H11 HOH PCP Australia Division (AUD) 1,329 (6%) 2% APE
Slide 15: Income composition
Income composition For personal use only Income movement (Pro forma) Markets Revenue by Geography 1H11 v 2H10 ($m) $m 1,600 23% CAGR 1,200 800 Markets Mix Impact 8,430 400 234 1H08 2H08 1H09 2H09 1H10 2H10 1H11 Australia APEA New Zealand Pro forma NII movement 1H11 v 2H10 Up 9% $m 220 94 5,642 8,102
Slide 16: Net Interest Margin
Net Interest Margin For personal use only bps Movement 1H11 V 2H10 7.2 249.7 1.3 247.2 1.0 0.4 4.2 5.4 278.0 Up 2.9 bps Ex-Markets 280.9 Down 2.5 bps 2H10 Funding Funding Costs Deposits Assets Other Markets 1H11 & Asset Mix Movement 1H11 v 1H10 (bps) Funding & 1H10 Funding Costs Deposits Assets Othe
Slide 17: Net Interest Margin
Net Interest Margin For personal use only Net Interest Margin HOH Composition of margin relative to peers 2.70% 2.50% • Key differentiator is asset mix: • Mix of mortgages 2.30% • Institutional lending • Greater proportion of undrawn 2.10% lines which are included in NII but not assets • Line fees i
Slide 18: Investment continues in high growth businesses
Investment continues in high growth businesses For personal use only Revenue & Expense Growth Pro forma 1H11 v 2H10 Mature Domestic Investing for Growth Businesses 18% 14% 8% 4% 4% 3% 1% -4% Australia Division New Zealand Asia Pacific Institutional Businesses Europe & America 18
Slide 19: Individual Provision Charge & Impaired Assets
Individual Provision Charge & Impaired Assets For personal use only Total Provision Charge New Impaired Assets AUDm AUDm 1,800 4,000 3,600 1,621 1,600 1,435 3,500 3,126 3,035 1,400 3,000 1,200 2,437 1,098 2,319 2,500 1,000 2,000 800 722 660 1,500 600 400 1,000 200 500 0 0 1H09 2H09 1H10 2H10 1H11 -2
Slide 20: Collective Provision Charge & Management Overlay
Collective Provision Charge & Management Overlay For personal use only Collective Provision Charge Management Overlay Charge 1H11 $m $m Reflects release 500 79 made prior to 1st Canterbury 60 earthquake 400 300 -19 200 Australia NZ Businesses Group Division 100 Management Overlay Balance 0 $m 600 -1
Slide 21: Outlook
Outlook For personal use only Group Margin ex-Markets Currency Impacts 2.78% 2.81% Current Hedging Unhedged 2.69% 2.55% (3.1%) 2.35% ~(0.7%) Mature (1.5%) Growth ~(0.3%) FY11 PCP FY11 sensitivity 1H09 2H09 1H10 2H10 1H11 @ Current rates to further 5% Markets Income Cost Growth 1600 $m Revenue Gr
Slide 22: Investor Discussion Pack: Net Interest Margin
For personal use only 11 HALF YEAR RESULTS AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED 3 May 2011 Investor Discussion Pack Net Interest Margin
Slide 23: NIM movement summary
NIM movement summary For personal use only Basis points (bps) Group Regions Divisions Australia NZ Australia Division NZ Businesses Global Institutional HOH PCP HOH PCP HOH PCP HOH PCP HOH PCP HOH PCP Starting NIM 249.7 245.0 263.1 259.6 234.0 219.7 254.0 264.0 238.2 221.2 217.0 213.8 Funding & Asse
Slide 24: Net Interest Margin
Net Interest Margin For personal use only Net Interest Margin HOH Composition of margin relative to peers 2.70% 2.50% • Key differentiator is asset mix: • Mix of mortgages 2.30% • Institutional lending • Greater proportion of undrawn 2.10% lines which are included in NII but not assets • Line fees i
Slide 25: Drivers of Net Interest Margin
Drivers of Net Interest Margin For personal use only 1H11 Net Interest Margin Ex-Markets Composition 2.81% 2.81% APEA Other New Institutional Deposits Zealand Commercial Deposits Deposits Retail Deposits Institutional Lending Commercial Lending Australia Lending Retail Lending Geography Product Key
Slide 26: Net Interest Margin - Group
Net Interest Margin - Group For personal use only NIM movement 1H11 v 2H10 bps 7.2 1.3 1.0 249.7 0.4 247.2 4.2 5.4 Ex-markets up 2.9 bps Down 2.5 bps 2H10 Funding & Funding Costs Deposits Assets Other Markets 1H11 Asset Mix Key drivers of movement Funding mix benefit from reduced reliance on wholesa
Slide 27: Net Interest Margin - Australia Division
Net Interest Margin - Australia Division For personal use only NIM movement 1H11 v 2H10 bps 2.5 258.0 5.9 254.0 2.6 2.3 4.7 Up 4.0 bps 2H10 Funding & Asset Funding Costs Deposits Assets Other 1H11 Mix Key drivers of movement Asset mix impacted an increase in the proportion of mortgage business durin
Slide 28: Net Interest Margin - New Zealand Businesses
Net Interest Margin - New Zealand Businesses For personal use only NIM movement 1H11 v 2H10 bps 243.8 18.9 2.1 238.2 1.0 5.8 Up 5.6 bps 8.6 2H10 Funding & Asset Funding Costs Deposits Assets Other 1H11 Mix Key drivers of movement Funding & Asset Mix Decrease primarily driven by decline in net free f
Slide 29: Net Interest Margin – Global Institutional
Net Interest Margin – Global Institutional For personal use only NIM movement 1H11 v 2H10 bps 6.0 217.0 0.7 1.8 1.9 12.2 198.1 Ex-markets down 9.2 bps 9.7 Down 18.9 bps 2H10 Funding & Funding Costs Deposits Assets Other Markets 1H11 Asset Mix Key drivers of movement Funding & Asset Mix Increase in p
Slide 30: Investor Discussion Pack: Balance Sheet Management
For personal use only 11 HALF YEAR RESULTS AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED 3 May 2011 Investor Discussion Pack Balance Sheet Management
Slide 31: Group loans and deposits
Group loans and deposits For personal use only Group customer deposits Group net loans and advances (including acceptances) Growth Rates Growth Rates FY07 FY08 FY09 FY10 1H11 FY07 FY08 FY09 FY10 1H11 15% 13% 14% 11% 4% 13% 15% (1%) 4% 2% $b $b 400 400 350 350 300 300 250 250 200 200 150 150 100 100
Slide 32: Customer deposits by geography
Customer deposits by geography For personal use only Australia (AUDb) New Zealand (NZDb) APEA (USDb) Growth Rates Growth Rates Growth Rates FY08 FY09 FY10 1H11 FY08 FY09 FY10 1H11 FY08 FY09 FY10 1H11 10% 16% 7% 2% 5% 1% 0% 5% 49% 49% 72% 22% 180 160 140 120 100 80 60 40 20 0 Sep Sep Sep Sep Mar Sep
Slide 33: Customer deposit composition by segment
Customer deposit composition by segment For personal use only Group deposits by segment Deposits composition (AUDb) March 2011 269 259 7 238 7 7 Group 37% 19% 42% 2% 118 113 105 Australia 29% 22% 48% 1% 40 44 40 APEA 77% 23% 99 100 86 New Zealand 19% 29% 44% 8% Mar 10 Sep 10 Mar 11 1 Wealth Retail C
Slide 34: Net loans and advances by geography
Net loans and advances by geography For personal use only Australia (AUDb) New Zealand (NZDb) APEA (USDb) Growth Rates Growth Rates Growth Rates FY07 FY08 FY09 FY10 1H11 FY07 FY08 FY09 FY10 1H11 FY07 FY08 FY09 FY10 1H11 14% 0% 6% 3% 11% (1%) (1%) (1%) large (2%) 45% 19% 300 250 200 150 100 50 0 Sep
Slide 35: Lending composition by segment
Lending composition by segment For personal use only Group lending composition Lending composition by segment (AUDb) March 2011 367 376 353 20 20 18 Group 21% 22% 51% 5% 186 191 Australia 177 19% 17% 59% 5% APEA 80% 20% 84 85 84 New Zealand 7% 54% 37% 2% 73 76 80 Mar 10 Sep 10 Mar 11 Institutional C
Slide 36: Australia Region - Deposits
Australia Region - Deposits For personal use only Growth Rates Deposit movement – 1H11 v 2H10 Retail $b 1.2 14% 1.4 0.0 1.1 5.1 7% 168.1 0.2 164.8 5.3 0.1 HOH PCP Commercial Sep-10 Retail Wealth Esanda Regional Business SBB Inst. Other Mar-11 Banking Commercial 12% 10% Household deposit growth (Mult
Slide 37: Australia Region - Lending
Australia Region - Lending For personal use only Growth Rates Lending movement – 1H11 v 2H10 Retail $b 1.9 277.8 10% 0.4 0.0 0.9 0.1 0.0 6.2 0.1 0.4 4% 268.8 HOH PCP Commercial Sep-10 Mortgages Cards & Wealth Esanda Regional Business SBB Inst. Other Mar-11 Unsec. Banking Retail Commercial 4% 1% Mort
Slide 38: APEA Region - Deposits
APEA Region - Deposits For personal use only Growth Rates APEA deposits 1H11 deposit growth by Retail segment (HOH) 53% RBS1 Impact 1H10 2H10 5% (USD b) 1.5 5.0 (%) 60 56.2 30% 28% HOH PCP 50 46.1 25% Institutional 40 37.4 20% 50% 26.8 30 15% 28% 20 10% 6% 4% 10 5% HOH PCP - 0% 2H09 1H10 2H10 1H11 R
Slide 39: APEA Region - Lending
APEA Region - Lending For personal use only Growth Rates APEA loans 1H11 loan growth by APEA Region RBS1 Impact segment (HOH) 62% (USD b) 1H10 2H10 (%) 0.4 2.8 35 35% 31% 19% 28.8 30 30% 24.1 25 25% 17.7 19% HOH PCP 20 16.7 20% 15 15% 12% Retail 10 10% 55% 5 5% 2% - 0% 2H09 1H10 2H10 1H11 Retail Ret
Slide 40: New Zealand Region Lending
New Zealand Region Lending For personal use only Growth Rates (NZD) Lending Movement – 1H11 v 2H10 Retail NZDb 96.0 0.0 0.1 95.4 0.3 0.4 -1% -1% HOH PCP Down 1% Commercial Sep Retail Commercial Institutional Wealth Mar 2010 2011 0% Lending Composition by Business -1% 95.7 96.0 95.4 HOH PCP 38% Insti
Slide 41: New Zealand Region Deposits
New Zealand Region Deposits For personal use only Growth Rates (NZD) Deposit Movement – 1H11 v 2H10 Retail NZDb 0.5 0.3 62.8 4% 1.5 3% 0.8 59.7 HOH PCP Up 5% Commercial 9% Sep Retail Commercial Institutional Wealth Mar 2010 2011 5% Deposit Composition by Business 62.8 59.3 59.7 HOH PCP 44% 29% Insti
Slide 42: Global Institutional Deposits
Global Institutional Deposits For personal use only Growth Rates (AUD) Deposit movement 1H11 v 2H10 Australia 7% $b 98.7 6.8 0.0 100.3 5.2 -10% Majority of reduction in wholesale investor, less sticky deposits HOH PCP APEA Sep Australia APEA New Zealand Mar 2010 2011 33% 20% Deposit Composition by G
Slide 43: Global Institutional Lending
Global Institutional Lending For personal use only Growth Rates (AUD) Lending movement – 1H11 v 2H10 Australia $b 2.9 80.2 4% 0.2 1.9 1% 75.6 Up 6% HOH PCP APEA Sep Australia APEA New Zealand Mar 2010 2011 46% Lending Composition by Geography 15% 85.4 75.6 80.2 70.6 73.1 HOH PCP 28% New Zealand 66%
Slide 44: Investor Discussion Pack: Regional Performance
For personal use only 11 HALF YEAR RESULTS AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED 3 May 2011 Investor Discussion Pack Regional Performance (Geographies & Divisions)
Slide 45: Australia region
Australia region For personal use only Pro Forma Net Profit After Tax 1H11 revenue by business1 $m 10% 2,150 Retail 29% 1,950 Commercial 22% 1,750 Wealth 671 Institutional 1,550 Institutional 38% 1,350 1,150 434 Commercial 1H11 NPAT by business1 950 1,927 1,962 1,733 186 Wealth 750 9% 34% Retail 550
Slide 46: Australia region
Australia region For personal use only Pro forma Growth Rates Pro forma NPAT movement – 1H11 v 2H10 Revenue $m Revenue growth: Australia Div = 4%; 48 Institutional = -4% 5% 57 2% 16 1,962 13 HOH PCP 1,927 99 Expenses 4% 8% 2H10 Net Other Exp. Prov. Tax and 1H11 Interest Income OEI HOH PCP Pro forma
Slide 47: Australia Division – Business update & strategy
Australia Division – Business update & strategy For personal use only ANZ Australia delivered a solid outcome • Mortgages growth 1.2x system and customer Multiple of system (1H11)1 deposit growth 1.6x system for the half • Increased commercial customers - ANZ Household 1.2x Commercial Banking custom
Slide 48: Australia Division
Australia Division For personal use only Pro forma Growth Rates Pro forma NPAT movement – 1H11 v 2H10 Revenue $m 149 5% 8 4% 57 1,411 HOH PCP 3 1,329 Expenses 169 3% 4% 2H10 Net Other Exp. Prov. Tax and 1H11 Interest Income OEI HOH PCP Pro forma NPAT movement – 1H11 v 1H10 Provisions $m 69% 17% 175
Slide 49: Australia Division – Retail
Australia Division – Retail For personal use only Pro forma Growth Rates Trial intention … leading to customer gains (%) transactional account trial intention1 („000s; MFI Relationship)2 Revenue 30 180 6% 150 3% 116 20 120 77 HOH PCP 90 72 61 10 60 Expenses 30 0 0 4% Jan-10 Apr-10 Jul-10 Oct-10 Jan-
Slide 50: Australia Division – Commercial
Australia Division – Commercial For personal use only Pro forma Commercial underlying performance uneven - Business Growth Rates and Small Business performance was solid offset by Revenue difficult conditions for Regional Commercial 7% Net interest income Net loans and advances incl. 1% SBB & BB acc
Slide 51: Australia Division – Regional Commercial Banking
Australia Division – Regional Commercial Banking For personal use only Credit Quality Significant pay down of debt occurring • Higher provisions partly due to long-term after high agri cash inflows stress in the sector and also specifically Productive Loans v. Deposit FUM for extreme weather events
Slide 52: Australia Division – Wealth
Australia Division – Wealth For personal use only Pro forma Growth Rates Insurance Funds Under Management in-force premiums $m Up 12% $m Up 2% Operating Income 1,320 1,381 44,608 44,493 45,456 1,230 5% 1% HOH PCP 1H10 2H10 1H11 1H10 2H10 1H11 Operating Expenses General Insurance Individual Group ANZ
Slide 53: APEA - Business update and strategy
APEA - Business update and strategy For personal use only The APEA business continues to grow via organic build of customer relationships and core capabilities, and inter-connectivity across the network, together with Partnerships Focused investment and increased cost efficiency drives Performance H
Slide 54: APEA Division overview
APEA Division overview For personal use only Pro forma revenue & expenses 1H11 revenue by geography (USD m) 2,500 2,094 14% South East Asia 2,000 1,500 1,268 36% North East Asia 1,214 1,071 12% 1,023 1,000 730 641 Pacific 573 500 38% Europe & America 0 FY10 1H10 2H10 1H11 Revenue Expenses Pro forma
Slide 55: APEA Division financial performance
APEA Division financial performance For personal use only Pro forma Growth Rates Pro forma NPAT movement – 1H11 v 2H10 Revenue USD m 24% 167 18% 18 30 89 385 335 76 HOH PCP Expenses 27% 14% 2H10 Net Other Exp. Prov. Tax and 1H11 Interest Income OEI HOH PCP Pro forma NPAT movement – 1H11 v 1H10 Provi
Slide 56: APEA Institutional
APEA Institutional For personal use only Pro forma APEA Institutional revenue Strong contribution by Growth Rates driven by Asia Global Markets Revenue Underlying revenue (USD ‘000) 30% 29% 9% 800 FY09 benefited Asia from increased 13% market 600 volatility 9% Europe 400 HOH PCP America 200 Expenses
Slide 57: APEA Retail & Wealth
APEA Retail & Wealth For personal use only Pro forma Growth momentum in Asian Significant customer Growth Rates Wealth AUM1 build-out Revenue Customer Numbers (‘000) USD m 18% 5,838 6 14% 5,248 Includes 6 Includes 431 420 accounts from accounts from RBS acquisition RBS acquisition 5 HOH PCP 1,439 43
Slide 58: Asia Partnerships' contribution continues to be significant
Asia Partnerships' contribution continues to be significant For personal use only Partnership contribution to Growth in value in Partnerships APEA NPAT ANZ share as at (31 March 2011) USD m USD b 200 5 Listed investment Unlisted investment Others 4 150 BoT Panin 3 100 AMMB 2 SRCB 50 1 Sacombank - Im
Slide 59: New Zealand – simplifying structure, systems and processes
New Zealand – simplifying structure, systems and processes For personal use only Simplifying our structure to be more customer focused • Management structure change will deliver greater external focus and faster decision making while reducing costs Moved from six national management structures to
Slide 60: New Zealand economic update
New Zealand economic update For personal use only • Emerging economic recovery impacted by the The Canterbury earthquake delayed the upswing Christchurch earthquake in February: Reconstruction work of $15-20bn is equivalent to up to 10% 6% Forecast of annual GDP Immediate fall in confidence but
Slide 61: New Zealand Region
New Zealand Region For personal use only Net Profit After Tax 1H11 Profit Before Provisions (Pro forma) Contribution by Business1 3% (NZD m) Retail 1,000 23% 884 Commercial 900 50% Wealth 800 24% Institutional 700 643 605 600 510 500 1H11 NPAT 374 400 Contribution by Business1 300 4% 200 Retail 27%
Slide 62: New Zealand Region
New Zealand Region For personal use only Pro forma Growth Rates Pro forma NPAT movement – 1H11 v 2H10 Revenue NZDm 46 6% 59 605 4% 510 7 55 38 HOH PCP Expenses 2% 2H10 Net Other Exp. Prov. Tax and 1H11 Interest Income OEI -5% HOH PCP Financial performance has continued to improve with Provisions rec
Slide 63: New Zealand Region – Key drivers of performance
New Zealand Region – Key drivers of performance For personal use only Pro forma NPAT Contribution Revenue & expense growth NZDm 496 605 7% 510 374 6% 147 4% 1H09 2H09 1H10 2H10 1H11 2% 2% Retail & Wealth Commercial 1% Institutional Other Provision charges NZDm 599 330 291 131 -5% -5% 85 1H10 2H10 1H
Slide 64: New Zealand Businesses
New Zealand Businesses For personal use only Pro forma Growth Rates Pro forma NPAT movement – 1H11 v 2H10 Revenue NZDm 7% 67 453 376 22 30 1% 35 - 7 HOH PCP Expenses Flat 2H10 Net Other Exp. Prov. Tax and 1H11 Interest Income OEI -4% HOH PCP Pro forma NPAT movement – 1H11 v 1H10 Provisions NZDm 253
Slide 65: New Zealand Businesses – Revenue composition
New Zealand Businesses – Revenue composition For personal use only NZ Businesses Pro forma Revenue Mortgage portfolio composition Composition (NZDm) NZDm 100% 1,600 2.50% 23% 23% 32% 80% 42% 54% 2.45% 60% 1,400 2.40% 40% 77% 77% 68% 58% 1,200 20% 46% 2.35% 0% 1,000 2.30% 1H09 2H09 1H10 2H10 1H11 2.2
Slide 66: New Zealand – Retail & Wealth
New Zealand – Retail & Wealth For personal use only Pro forma Well managed business in a subdued economy Growth Rates • Strong NPAT growth driven by significant decline in provisions both HoH and PCP Revenue • Revenue has absorbed ~1% PCP impact of exception fee reductions effective 1st 4% December
Slide 67: New Zealand – Commercial & Agri
New Zealand – Commercial & Agri For personal use only Pro forma Successful consolidation of the Agri division into Commercial Growth Rates1 division now better placed to support customers growth Revenue • New Zealand Commercial business now comprises of Commercial 9% division, Agri division and Busi
Slide 68: New Zealand – Business Banking
New Zealand – Business Banking For personal use only Establishment of a standalone specialist business bringing a new level of focus to managing small business customers • FUM and revenue growth solid in a subdued market • Strong NPAT growth and a significant decline in provisions evident in the HoH
Slide 69: New Zealand – Institutional
New Zealand – Institutional For personal use only Pro forma ANZ continues to dominate the NZ institutional segment Growth Rates • Extended position as clear market leader, outstanding results across 5 Peter Lee Revenue Associate surveys 13% • First half revenue growth reflects strong Markets result.
Slide 70: Global Institutional
Global Institutional For personal use only Making Clear Progress on our Strategy Growing connectivity driven revenue • Growing our client base and diversifying our geographic mix: Brought on 676 new Institutional, Corporate and Financial Institutions clients in the past half, a 10% increase HOH Do
Slide 71: Global Institutional – Financial Performance
Global Institutional – Financial Performance For personal use only Pro forma Growth Rates Pro forma NPAT movement – 1H11 v 2H10 Revenue 7% $m 156 203 1,028 4% 914 72 71 102 HOH PCP Expenses 20% 8% 2H10 Net Other Exp. Prov. Tax and 1H11 Interest Income OEI HOH PCP Pro forma NPAT movement – 1H11 v 1H1
Slide 72: Global Institutional – Performance by Geography
Global Institutional – Performance by Geography For personal use only Pro forma Growth Rates Pro forma PBP movement - 1H11 v 2H10 1H11 v 2H10 AUDm Revenue 108 26 1,591 1,561 104 30% 13% -4% Australia APEA New Zealand 2H10 Australia APEA New Zealand 1H11 PBP 48% 19% Pro forma PBP movement - 1H11 v 1H
Slide 73: Global Institutional – Performance by Business
Global Institutional – Performance by Business For personal use only Pro forma Growth Rates Pro forma PBP movement – 1H11 v 2H10 1H11 v 2H10 $m 24 67 Revenue 1,591 1,561 29 32 12% Impacted by one-off interest 4% 0% write back 2H10 Global Transaction Global Loans Banking Markets 2H10 Global Transacti
Slide 74: Global Markets – Performance by Product
Global Markets – Performance by Product For personal use only Revenue Growth $m Revenue Contribution by Product Total Revenue 8% 1400 1200 -2% 1000 31% HOH PCP 800 Fixed Income 12% 600 43% 12% 400 200 14% 0 -18% 1H08 2H08 1H09 2H09 1H10 2H10 1H11 HOH PCP -200 FX & Commodities Other Capital Markets F
Slide 75: Global Markets – Performance by Geography
Global Markets – Performance by Geography For personal use only Revenue Growth Revenue Contribution by Geography Australia $m 1,400 (4%) 1,200 (7%) 1,000 HOH PCP 800 600 53% 35% APEA 30% 400 12% 200 16% 1H08 2H08 1H09 2H09 1H10 2H10 1H11 HOH PCP Australia APEA New Zealand New Zealand 19% • Results h
Slide 76: Transaction Banking
Transaction Banking For personal use only Payments & Cash Management ANZ Transactive Monthly Transaction Volumes • Effective working capital and liquidity 2,500,000 8,000 management is central to any client‟s core 7,000 banking relationship 2,000,000 6,000 • ANZ Transactive monthly transaction volum
Slide 77: Investor Discussion Pack: Treasury
For personal use only 11 HALF YEAR RESULTS AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED 3 May 2011 Investor Discussion Pack Treasury
Slide 78: ANZ well capitalised and positioned to manage transition to Basel III
ANZ well capitalised and positioned to manage transition to Basel III For personal use only Basel II Basel III – Core Tier 1 ~15.5% ~14.1% 13.0% 12.1% 11.9% 10.7% 10.5% ~9.5% ~9.5% 10.1% Core ~8.5% Tier 1 ~8.3% surplus ~7.7% over 7.0% ~7.4% ~7.0% Capital Buffer ~11.8% 2.5% Additional Basel 3 Full al
Slide 79: Solid organic capital generation underpins strong Core Tier-1 position
Solid organic capital generation underpins strong Core Tier-1 position For personal use only Capital Position (Core Tier-1 Ratio) ~11.8 ~9.5 1.06 (0.37) (0.09) (0.09) (0.07) 8.49 8.05 Portfolio Growth & mix: 15bp decrease Risk Migration: 7bp increase Non credit RWA: 1bp decrease net organic up 51bp
Slide 80: Tier-1 position continues to strengthen with solid organic capital generation
Tier-1 position continues to strengthen with solid organic capital generation For personal use only Capital Position (Tier-1 Ratio) ~14.1 1.06 (0.37) ~11.3 (0.11) (0.10) (0.07) 10.51 10.10 Portfolio growth & mix: 18bp decrease Risk Migration: 8bp increase Non credit RWA: 1bp decrease net organic up
Slide 81: Reconciliation of ANZ's capital position to FSA Basel guidelines
Reconciliation of ANZ’s capital position to FSA Basel 2 guidelines For personal use only APRA regulations are more conservative than current FSA regulations, in that APRA requires: • A 20% Loss Given Default floor for mortgages (FSA: 10% floor) • Interest Rate Risk in the Banking Book (IRRBB) includ
Slide 82: Stable term debt issuance, portfolio costs continue to increase
Stable term debt issuance, portfolio costs continue to increase For personal use only Stable term funding profile – FY11 issuance Portfolio term funding costs continue to ahead of schedule (~70% complete) increase as pre 2008 debt reprices Senior Debt Government Guarantee 1 Bps Subordinated Debt Pre
Slide 83: ANZ's well diversified and improved funding profile
ANZ’s has a well diversified and improved funding profile For personal use only Strong Funding Composition Minimal offshore short-term wholesale funding; Offshore CP accounts for <2% (~$8.6b) Short Term Wholesale Customer Funding Funding Shareholders equity & Term Debt < 1 year Gross Interbank, Othe
Slide 84: Solid Liquidity position however B3 liquidity requirements remain uncertain
Solid Liquidity position however B3 liquidity requirements remain uncertain For personal use only Strong liquidity position ($b) Recent Basel III Developments • The implementation of the new B3 liquidity 6.2 5.0 requirements remains subject to consultation 7.8 and clarification • Key Definitions inc
Slide 85: Foreign Exchange impacts
Foreign Exchange impacts For personal use only Earnings Composition by Region EPS Impact & Average Translation Rates % Group Current Hedging Unhedged Underlying Profit ~(3.1%) 100% 1.40 (2.5%) 90% 1.30 (1.9%) ~(1.5%) 80% 1.20 70% 60% 1.10 50% 1.00 1H11 HoH FY11 PCP @Current rates 40% 0.90 30% • Hedg
Slide 86: Investor Discussion Pack: Risk Management
For personal use only 11 HALF YEAR RESULTS AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED 3 May 2011 Investor Discussion Pack Risk Management
Slide 87: Provision Charge and Impaired Assets
Provision Charge and Impaired Assets For personal use only Total Provision Charge New Impaired Assets (IP charge by Division, total CP charge) by Division $m $m 1,800 1,621 4,000 1,435 3,600 1,600 3,500 3,126 1,400 3,035 3,000 1,200 1,098 2,437 2,500 2,319 1,000 Oswal 2,000 722 800 660 1,500 600 1,0
Slide 88: Individual Provision Charge
Individual Provision Charge For personal use only Individual Provision Charge Individual Provision Charge by Segment composition $m $m 2,000 2,000 1,531 1,283 1,062 1,500 762 1,800 594 1,000 1,531 1,600 500 0 1,400 1,283 -500 1,200 1H09 2H09 1H10 2H10 1H11 1,062 New Increased Writebacks & Recoveries
Slide 89: Collective Provision Charge
Collective Provision Charge For personal use only Collective Provision Charge by Source Lending Growth Economic Cycle & Concentration Risk Profile Portfolio Mix $m 500 Total Group Australia New Zealand Global APEA Division Businesses Institutional (ex-Inst.) 400 66 116 (46) 5 (9) 300 56 16 29 200 12
Slide 90: Credit Risk Weighted Assets
Credit Risk Weighted Assets For personal use only Total Credit Risk Weighted Assets Credit RWA movement 1H11 $b $b 257.8 4.6 233.5 0.1 233.2 233.5 233.2 229.8 3.7 220.4 1.1 Mar 09 Sep 09 Mar 10 Sep 10 Mar 11 Sep 10 Growth Data FX Risk Mar 11 Review Impact 90
Slide 91: Impaired Assets
Impaired Assets For personal use only Gross Impaired Assets Gross Impaired Assets by Type by Size of Exposure $m $m 8,000 Impaired Loans NPCCD Restructured 6,561 6,561 5,595 6,221 6,000 8,000 4,158 4,000 7,000 6,561 6,561 2,000 6,221 0 6,000 5,595 Oswal Mar 09 Sep 09 Mar 10 Sep 10 Mar 11 5,000 > $10
Slide 92: Watch & Control Lists and Risk Grade Profiles
Watch & Control Lists and Risk Grade Profiles For personal use only Group Risk Grade profile by Watch & Control List Exposure at Default Index Watch List by Limits Mar 2009 Watch List by No. Groups 6% 6% 6% 6% = 100 Control List by Limits 9% 9% 9% 8% Control List by No. Groups 180 13% 13% 13% 12% 16
Slide 93: Commercial Industry Exposures
Commercial Industry Exposures For personal use only Finance & Insurance Property Services Manufacturing 80 14% 80 14% 80 14% 12% 12% 12% 60 60 10% 60 10% 10% 8% 8% 8% 40 40 40 6% 6% 6% 4% 20 4% 20 4% 20 2% 2% 2% 0 0% 0 0% 0 0% Mar 10 Sep 10 Mar 11 Mar 10 Sep 10 Mar 11 Mar 10 Sep 10 Mar 11 Agri, Fore
Slide 94: Australia 90+ Day Delinquencies
Australia 90+ Day Delinquencies For personal use only Australia Retail Australia Division 90+ day delinquencies 90+ day Delinquency Balance ($m) 2,000 Total Mortgage Portfolio NSW & ACT Mortgages 1,500 1.50% QLD Mortgages 1,000 VIC Mortgages WA Mortgages 500 Total Credit Cards 0 Mar 10 Sep 10 Mar 11
Slide 95: Australia Mortgages
Australia Mortgages For personal use only Portfolio Statistics Dynamic Loan to Valuation Ratio % Portfolio Total Number of Mortgage Accounts 831k 60% Total Mortgage FUM $165b 50% 40% 10% of Portfolio >80% LVR % of Total Australian Lending 59% 30% 20% % of Total Group Lending 44% 10% 0% Owner occupie
Slide 96: Australia Commercial
Australia Commercial For personal use only Australia Commercial Regional Commercial Banking 90+ day delinquencies 90+ day delinquencies 3.00% RCB Total Agri Other Commercial Business Banking 3.00% Regional Commercial Banking 2.50% 2.50% Esanda 2.00% Small Business Banking 1.50% 2.00% 1.00% 0.50% 0.0
Slide 97: The Queensland economy was already facing challenges before the onset of natural disasters
The Queensland economy was already facing challenges before the onset of natural disasters For personal use only Unemployment did not experience the Tourism flows have been declining level of decline experienced in the impacted by a strong AUD % national average 2,000 Net Tourism (lhs) 0.40 Net Tour
Slide 98: New Zealand
New Zealand For personal use only Total Impaired Assets Total Provision Charge NZDm NZDm 2.31% 800 598 2.13% 600 400 291 330 1.89% 2,236 131 85 200 2,079 0 1,837 -200 1H09 2H09 1H10 2H10 1H11 1.24% IP Charge CP Charge 90+ Days Arrears 1,220 1.20% Mortgages 0.64% Commercial Rural 639 0.80% 0.40% Mar
Slide 99: Credit Intermediation Trades
Credit Intermediation Trades For personal use only Position as at 31 Mar Notional Life to Date Notional 2011 purchased Credit Risk Credit Risk Principal Mark to protection on on Amount on No. Market principal Derivatives Derivatives corresponding (USDm) amount (USDm) (AUDm) Sold Protection Counterpa
Slide 100: Credit Intermediation Trade Portfolio
Credit Intermediation Trade Portfolio For personal use only • Cumulative Credit Risk on Derivative expense for the Credit Credit Intermediation Trades Intermediation Trade portfolio as at 31/3/2011 was $461m (down $55m from 30/9/2010) • Credit markets have shown a tightening bias over the past six m
Slide 101: Investor Discussion Pack: Economic Updates
For personal use only 11 HALF YEAR RESULTS AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED 3 May 2011 Investor Discussion Pack Economic Updates
Slide 102: Economic updates
Economic updates For personal use only Australia New Zealand 2009 2010 2011 2012 2009 2010 2011 2012 GDP 0.9 2.7 1.7 4.0 -2.8 1.3 0.4 4.0 Inflation 1.3 2.8 2.9 2.6 1.7 1.5 5.01 2.7 Unemployment 5.8 5.2 5.0 4.5 6.5 6.4 6.6 6.1 Cash rate 3.00 4.50 5.00 5.75 2.50 3.00 2.50 3.75 AUD/USD 0.88 0.97 1.05 0
Slide 103: Growth Forecasts – Asia
Growth Forecasts – Asia For personal use only Emerging Asia GDP Growth Forecasts 2007 2008 2009 2010 2011 2012 China 13.0 9.6 9.1 10.3 9.5 9.5 India 9.5 7.3 6.8 8.6 8.9 9.8 NIEs Hong Kong 6.4 2.4 -2.8 6.5 5.0 5.2 Korea 5.1 2.3 0.2 6.1 3.9 4.7 Singapore 8.5 1.8 -1.3 14.5 4.6 5.5 Taiwan 5.9 1.1 -1.9 1
Slide 104: For personal use only
For personal use only The material in this presentation is general background information about the Bank‟s activities current at the date of the presentation. It is information given in summary form and does not purport to be complete. It is not intended to be relied upon as advice to investors or p
Australia and New Zealand Banking Group — 1H11 Earnings Presentation on 6ix