Commonwealth Bank Of Australia · ASX:CBA
Commonwealth Bank Of Australia — FY2007 Earnings Presentation
102 slides from Commonwealth Bank Of Australia's earnings presentation, Aug 15, 2007
Slide 1: Results Presentation for the Full Year Ended 30 June 2007
For personal use only Ralph Norris CHIEF EXECUTIVE OFFICER David Craig CHIEF FINANCIAL OFFICER 15 August 2007 Commonwealth Bank of Australia ACN 123 123 124 RESULTS PRESENTATION FOR THE FULL YEAR Ended 30 June 2007
Slide 2: Disclaimer
Disclaimer For personal use only The material that follows is a presentation of general background information about the Bank’s activities current at the date of the presentation, 15 August 2007. It is information given in summary form and does not purport to be complete. It is not intended to be re
Slide 3: Agenda
Agenda For personal use only Ralph Norris, CEO – Results & Company Update David Craig, CFO – Detailed Financials Ralph Norris, CEO – Outlook Questions and Answers 3
Slide 4: Notes
For personal use only Notes 4
Slide 5: Overview
Overview For personal use only Good result - all businesses delivered double digit profit growth Continued investment in the business to drive future growth Substantial progress on our five strategic priorities Credit quality maintained Good momentum going into new year 5
Slide 6: Other key information
Other key information Notes For personal use only Cash NPAT 6 months ($m) Jun 07 Dec 06 Jun 06 Dec 05 Cash NPAT 2,333 2,271 1,992 2,061 Less: Profit on sale of Hong Kong 0 0 0 (145) Cash NPAT (excl HK sale) 2,333 2.271 1,992 1,916 Some overall Bank indicators 6 months Jun 07 Dec 06 Jun 06 Dec 05 Num
Slide 7: Strong financial results
Strong financial results For personal use only Jun 07 vs Jun 07 Jun 06 Cash NPAT ($m) * 4,604 18% Cash EPS (cents) * 353.0 16% Return on Equity – Cash (%) 22.1 80 bpts Income ($m) 13,159 11% Expense ($m) 6,427 7% Final Dividend ($ per share) 1.49 15% * Excludes profit on sale of Hong Kong Insurance
Slide 8: Notes
For personal use only Notes 8
Slide 9: All brands performing strongly
All brands performing strongly For personal use only Banking Funds Mgt Insurance 9
Slide 10: Market shares
Market shares Notes For personal use only Jun 07 Dec 06 Jun 06 Banking Home loans 18.5% 18.4% 18.7% Credit cards 18.8% 19.3% 20.3% Retail deposits 21.6% 21.9% 22.2% Household deposits 29.0% 28.8% 29.3% Personal lending 16.4% 16.4% 16.1% Business lending - RBA 12.9% 13.0% 13.2% Business lending - APR
Slide 11: CEO priorities & measures
CEO priorities & measures For personal use only Customer Service Business Banking Technology & Operational Excellence Trust & Team Spirit Profitable Growth Î Superior operating and financial results Î Australia’s finest financial services organisation 11
Slide 12: Notes
For personal use only Notes 12
Slide 13: Customer Service
Customer Service For personal use only % customers satisfied (Roy Morgan Research – 6 month average) Continued focus on embedding Sales & 82% Services culture 4,000 front line staff trained in how to 72% better identify customer needs CBA 1,100 new customer facing roles across 62% the Group Ju
Slide 14: Notes
For personal use only Notes 14
Slide 15: On a journey...Australian Retail Banking
On a journey...Australian Retail Banking For personal use only Introduction of Management KPI’s CommSee linked to customer Branch satisfaction refurbishment Sales & Service Introduction of Program initiatives for our Saturday trading people Measurement of customer advocacy Revenue Oper
Slide 16: Notes
For personal use only Notes 16
Slide 17: Business Banking
Business Banking For personal use only Local Business Banking (LBB) Growth in Lending to Non-Financial ¾ 85 new Bankers in branches 160% Corporations 2005-2007* ¾ 78 new associates providing 24/7 150% access 140% ¾ Product and process simplification 130% 120% Corporate Financial Services 110% ¾
Slide 18: Notes
For personal use only Notes 18
Slide 19: CommBiz, FirstChoice, Netbank, CommSec, CommSee
CommBiz – online, real time secure business and corporate banking For personal use only FirstChoice – chosen by 50% of IFA’s Netbank – 2m active customers CommSec CommSee – 95% visibility of customer 19
Slide 20: EDS and Gen-i contracts
EDS and Gen-i contracts For personal use only FY07 New Deal Saving Contract Review Spend $m p.a End Telecommunication services FY08/FY09 Mobiles Gen-i Optus 2008 RAS $113m Telstra 10 - 15 2008 Voice and Data Services Gen-i 2009 Applications Development Maintenance Selective in-sourcing of strategic
Slide 21: Technology & Operational Excellence
Technology & Operational Excellence For personal use only IT Efficiency Ratio * 20% Saved over $100m of IT expense Successfully delivering large 15% 20.3% 17.3% portfolio of IT projects across the 16.5% 15.5% 15.0% business 10% 2006 Q1 2007 Q2 2007 Q3 2007 Q4 2007 Significant improvements in S
Slide 22: Notes
For personal use only Notes 22
Slide 23: Trust & Team Spirit improving
Trust & Team Spirit improving For personal use only Index CARES Survey Continued improvement in the 1.5 culture: 1.4 ¾ Increasing focus on customer 1.3 ¾ Positive momentum in people 1.2 engagement scores 1.1 ¾ Improved employee benefits 1.0 ¾ Increasing sense of pride 0.9 Nov 03 Nov 04 May 05 Nov
Slide 24: Notes
For personal use only Notes 24
Slide 25: Opportunities for Profitable Growth
Opportunities for Profitable Growth For personal use only Asian expansion plans progressing well: ¾ Indonesia - ANK acquisition - acquired JV partner stake in CMG Astra ¾ China - Further capital investment in Hangzhou - Cinda/CFS fund management JV launched ¾ Vietnam - Branch licence applied for
Slide 26: Notes
For personal use only Notes 26
Slide 27: David Craig, Chief Financial Officer
For personal use only David Craig CHIEF FINANCIAL OFFICER 15 August 2007 Commonwealth Bank of Australia ACN 123 123 124 RESULTS PRESENTATION FOR THE FULL YEAR Ended 30 June 2007
Slide 28: Non cash items
Non cash items For personal use only 12 months Jun 07 Jun 06 $m $m Defined benefit superannuation plan (income) / expense (5) 25 Treasury Shares valuation adjustment 75 100 One-off AIFRS mismatches 64 - 134 125 Defined benefit superannuation plan (income) / expense: This amount is influenced by ac
Slide 29: Strong result
Strong result For personal use only Jun 07 Jun 06 Jun 07 vs $m $m Jun 06 Operating income 13,159 11,835 11% Shareholder investment returns 149 101 48% Income 13,308 11,936 11% Operating expenses 6,427 5,994 7% Loan impairment expenses 434 398 9% Net profit before tax 6,447 5,544 16% Tax & Minorities
Slide 30: Other key information
Other key information Notes For personal use only 6 months Jun 07 Dec 06 Jun 06 Jun 07 vs Contribution to profit $m $m $m Jun 06 Banking 1,896 1,867 1,638 16% Funds Management 260 232 217 20% Insurance 142 111 112 27% NPAT (underlying) 2,298 2,210 1,967 17% Shareholder invest. returns 35 61 25 40% (
Slide 31: All businesses performing well
All businesses performing well For personal use only Jun 07 Jun 06 Jun 07 vs $m $m Jun 06 Australian Retail 1,840 1,678 10% Business, Corp and Institutional 1,529 1,236 24% AIFRS volatility 2 (41) Large Asia Pacific 390 356 10% Hedging and AIFRS volatility 59 17 Large Other (57) (19) Large Banking 3
Slide 32: Other key information
Other key information Notes For personal use only 6 months Jun 07 Dec 06 Jun 06 % of operating income Net interest income 53% 54% 54% Other banking income 26% 26% 26% Funds Mgt. income 15% 14% 14% Insurance income 6% 6% 6% Total 100% 100% 100% 32
Slide 33: Revenue growth outstrips costs
Revenue growth outstrips costs For personal use only 30% Jun 07 vs Jun 06 25% 24% 23% 23% 20% 20% 19% 18% 17% 16% 15% 15% 11% Investment 10% 10% 10% 10% 10% Spend 10% 7% 2% 5% 5% 5% 4% 5% 2% 1% 0% Australian BCI a Asia Pacific a Banking Funds Insurance b c Group d Retail Management b a Excludes hedg
Slide 34: Other key information
Other key information Notes For personal use only 6 months Jun 07 Dec 06 Jun 06 Jun 07 vs Jun 06 Av interest earning assets ($m) * 325,380 306,868 282,553 15% Net interest income ($m) * 3,489 3,432 3,202 9% Net interest margin (AIFRS) (bpts) 216 222 229 13 bpts * Excluding securitisation 34
Slide 35: Banking profit up 17%
Banking profit up 17% For personal use only Net interest income Volume Ç 15% 396 (239) Liquid margin È 3% 522 (36) (107) $3,763m Other margin È 4% $3,227m NII Ç 8% Other income Ç 13% ¾ Sale of Loy Yang $79m ¾ Mastercard $58m (06 $32m) ¾ Commissions & fees Ç 8% Jun 06 NII Other Expenses Loan Tax
Slide 36: Margin analysis
12 month margin analysis Notes For personal use only Underlying NIM: core lending 234 & deposits È 10bpts (6) 1 219 (8) (3) 1 Jun 06 Liquid AIFRS Asset Cash rate Other Jun 07 assets volatility pricing and & deposit mix pricing (basis points) 36
Slide 37: Underlying NIM down 6bpts since Dec
Underlying NIM down 6bpts since Dec For personal use only NII only 53% of total income Underlying NIM: core lending & deposits Liquid assets up over $4 billion È 6bpts 222 AIFRS derivative volatility inflating headline NIM (3) 3 (3) 216 Asset pricing and mix: Ç (3) Home loans 2 bpts Ç Other
Slide 38: Group impact – non trading derivatives
Group impact – non trading derivatives Notes For personal use only Peer 1 Peer 2 Peer 3 Peer 4 CBA Hedge ineffectiveness 8 9 8 9 9 (inside 80-125%) Non-AIFRS-complaint 8 9 8 9 9 economic hedge Hedge NZ profit 8 9 n/a 8 9 Pre-AIFRS hedge n/a n/a n/a 8 8 Key 9 = Included within Cash NPAT 8 = Excluded
Slide 39: AIFRS volatility – group impact
AIFRS volatility – group impact For personal use only Australia New Zealand Total FY07 FY06 FY07 FY06 FY07 FY06 $m $m $m $m $m $m AIFRS hedging volatility 3 (58) 117 3 120 (55) NZ revenue hedge - - (32) 22 (32) 22 Total banking income 3 (58) 85 25 88 (33) One-off AIFRS hedging (91) - - - (91) - mism
Slide 40: Other key information
Other key information For personal use only 6 months Jun 07 vs Jun 07 Dec 06 Jun 06 Jun 06 NII Home Loans 650 644 627 4% Consumer Finance 357 351 366 2% Retail Deposits 1,046 1,061 968 8% 2,053 2,056 1,961 5% Other income Home Loans 85 87 74 15% Consumer Finance 233 191 195 19% Retail Deposits 339 3
Slide 41: Australian Retail
Australian Retail For personal use only Net interest income Volume Ç 10% Jun 07 Jun 07 vs Ç $m Jun 06 Margin 5% NII Ç 5% Home Loans 1,466 4% Good volume growth: Consumer Finance 1,132 3% ¾ Home loans Ç 11% Retail Deposits 2,783 7% ¾ Deposits Ç 9% Total banking income 5,381 5% Expense growth of
Slide 42: Notes
For personal use only Notes 42
Slide 43: Australian Retail snapshot
Australian Retail snapshot For personal use only APRA market shares % Consumer 30/90 days past due * (Change in 6 month period) June 07 1.5 90 days past due 30 days past due Market Jun 06 Dec 06 Jun 07 Share 1.0 Home loans - 10bpts -30bpts +8bpts 18.5% Household -32bpts -51bpts +21bpts 29.0% 0.5 dep
Slide 44: Other key information
Other key information For personal use only Jun 07 Dec 06 Jun 06 Jun 07 vs Jun 06 NII Corporate Banking 281 274 253 11% Financial Markets * 291 209 233 25% Lending & Finance 510 495 439 16% 1,082 978 925 17% Other Income Corporate Banking 179 187 160 12% Financial Markets * 393 410 346 14% Lending &
Slide 45: Business, Corporate & Institutional
Business, Corporate & Institutional For personal use only Strong asset growth of 20% Jun 07 Jun 07 vs $m Jun 06 NII Ç 14% Corporate Banking 921 10% OBI Ç 17% Financial Markets 1,303 14% Core lending and deposits margin stable over the year Lending & Finance 1,641 21% Record CommSec trading
Slide 46: Notes
For personal use only Notes 46
Slide 47: Business, Corporate & Institutional snapshot
Business, Corporate & Institutional snapshot For personal use only Banking Products * Institutional Banking * $bn $bn (CFS, LBB, Agribusiness) 50 70 21% 60 18% 40 50 30 27% 40 20 30 20 7% 10 10 0 0 Jun 06 Jun 07 Jun 06 Jun 07 Assets Liabilities Assets Liabilities * average interest earning assets an
Slide 48: Other key information: ASB New Zealand
Other key information Notes For personal use only 6 months Jun 07 Dec 06 Jun 06 Jun 07 vs ASB: New Zealand NZ$m a $m $m $m Jun 06 Net interest income 453 437 412 10% Other income 165 168 172 4% Total operating income 618 605 584 6% Operating expenses 266 267 252 6% Loan impairment 14 4 9 56% Net pro
Slide 49: Asia Pacific
Asia Pacific For personal use only ASB contributed $374m Jun 07 Jun 07 vs $m Jun 06 ASB NPAT Ç 8% in NZD Net interest income 764 6% excluding the impact of Other banking income 318 1% hedging Total banking income 1,082 4% ASB NII Ç 8% Operating expenses 515 1% ¾ Lending assets Ç 16% Loan impai
Slide 50: Loan impairment expense to average RWA
Other key information Notes For personal use only Loan impairment expense to avg RWA (annualised) 0.20% 0.19% 0.19% 0.19% 0.20% 0.20% 0.17% 0.16% 0.15% Jun 04 Dec 04 Jun 05 Dec 05 Jun 06 Dec 06 Jun 07 Expense 126 146 176 188 210 195 239 50
Slide 51: Credit – maintained high standards
Credit – maintained high standards For personal use only Loan impairment expense as % of Gross impaired assets to RWA RWA down on last year at 0.19% 1.20% (06: 0.20%) 1.00% 0.80% CBA Limited private equity participation ANZ 0.60% NAB No exposure to CLO’s / CDO’s, 0.40% WBC or material direct e
Slide 52: Other key information: FirstChoice FUA
Other key information For personal use only 6 months FirstChoice Funds Under Administration balance & market share Jun 07 Dec 06 Jun 06 FUA market share: Plan for Life All Master Funds – Administrator View FUA Av. FUA ($bn) 171 158 148 $m Spot. FUA ($bn) 177 168 152 40,000 10.0% 51% Margins 9.0% Ope
Slide 53: Funds Management
Funds Management For personal use only FUA Ç 17% to $177bn Jun 07 Jun 07 vs Margins stable $m Jun 06 Largest retail share (14.2%) Net income * 1,598 20% First Choice Ç 51% over last 12 Shareholder investment months to $40bn returns 14 - AWG sell down progressing well, Funds management 1,61
Slide 54: Other key information: Insurance
Other key information Notes For personal use only 6 months Jun 07 Dec 06 Jun 06 Claims expense as % of net earned premium General insurance 68% 50% 57% Life insurance 44% 47% 41% Sources of profit $M $M $M Planned profit margins 90 94 77 Experience variations 49 7 29 Other 0 0 (2) General insurance
Slide 55: Insurance
Insurance For personal use only Inforce premiums Ç 21% Jun 07 Jun 07 vs $m Jun 06 a Planned profit margins Ç 26% Net income b 635 19% Australia total risk market share Shareholder investment 135 57% Ç to 14.2% (June 06 13.2%) returns Total insurance income 770 24% “Life Insurer of the Year”
Slide 56: Other key information: investment spend
Other key information Notes For personal use only Jun 07 Dec 06 Jun 06 Profit and loss 285 240 235 Capitalised 150 110 130 Cash investment spend 435 350 365 56
Slide 57: 18% increase in investment spend
18% increase in investment spend For personal use only FY07 Investment spend ($m) Expensed Capitalised Total Business banking growth strategy Growth New and refurbished branches projects Roll out of CommBiz 202 183 385 Improving cross sell of WM products Insurance and Wealth Management pro
Slide 58: Capital treatment
Capital treatment For personal use only AIFRS APRA S&P Accounting Tier 1 Tier 2 Total ACE Shareholders' Equity Ordinary Share Capital 3 3 3 3 Other Equity Instruments 3 3 3 Reserves General Reserve & Capital Reserve 3 3 3 3 GRCL 3 3 3 Asset Revaluation Reserve 3 3 3 Other reserve accounts 3 Retained
Slide 59: Strong capital position
Strong capital position For personal use only 11% Total * 9.66% 9.78% 9.76% Capital 1 Jan 2008 should see: 10% Target ¾ Basel II advanced accreditation 9% Range ¾ end of AIFRS capital transition 8% ¾ clarity on APRA capital needs 7% 7.56% * Tier 1 7.06% 7.14% Target 6% Range After balance date r
Slide 60: Notes
For personal use only Notes 60
Slide 61: Summary
Summary For personal use only Double digit profit growth from all business segments Continuing to invest for future growth and productivity Australian Retail market share improvements in second half Significant opportunities still exist in Business, Corporate and Institutional Investment i
Slide 62: Credit growth forecasts
Notes For personal use only Jun 07 Jun 08 Actual Forecast * Housing credit 13.2% 13-15% Other personal credit 15.3% 8.5-10.5% Business credit 18.7% 14-16% * CBA economist forecast for the Australian market as at July 2007 62
Slide 63: Outlook
Outlook For personal use only Economic outlook for Australia remains positive Housing credit growth expected to remain at similar levels to 2007 Some slowing expected in business and personal credit growth Financial services industry will remain competitive Given outlook and business mix,
Slide 64: Results Presentation closing slide
For personal use only Ralph Norris CHIEF EXECUTIVE OFFICER David Craig CHIEF FINANCIAL OFFICER 15 August 2007 Commonwealth Bank of Australia ACN 123 123 124 RESULTS PRESENTATION FOR THE FULL YEAR Ended 30 June 2007
Slide 65: Supplementary materials
For personal use only Supplementary materials
Slide 66: Economy
For personal use only Economy
Slide 67: GDP, unemployment and cash rates
GDP, unemployment and cash rates For personal use only 67
Slide 68: Credit growth
For personal use only Credit growth 68
Slide 69: Spreads
Spreads For personal use only Aus. BBB Corporates US BBB Corporates ~ 35bp over swaps ~ 50bp over swaps 69
Slide 70: Group
For personal use only Group
Slide 71: Fully franked dividends
Fully franked dividends For personal use only Dividend (cents per share) 240 200 149 160 130 112 Cents 104 120 82 85 107 80 94 79 85 68 69 Second Half 40 First Half 0 2002 2003 2004 2005 2006 2007 Payout Ratio (cash basis) 73.9% 73.9% 74.9% 71.0% 73.0% 71
Slide 72: Expenses
Expenses For personal use only 12 months Jun 07 Jun 06 Jun 07 vs Comparable expenses $m $m Jun 06 Staff expenses 3,229 2,823 14% Occupancy and equipment 688 621 11% IT Services 907 985 8% Postage and stationery 213 216 1% Fees and commissions 691 636 9% Advertising, marketing etc 326 307 6% Other 37
Slide 73: Banking
For personal use only Banking
Slide 74: AIFRS impact of non trading derivatives
AIFRS impact of non trading derivatives For personal use only 12 months Jun 07 Jun 06 Net interest income 107 46 Other banking income (19) (79) Net impact – pre tax 88 (33) Net impact – after tax 61 (24) 6 months Jun 07 Dec 05 Net interest income 78 29 Other banking income 44 (63) Net impact – pre t
Slide 75: Banking revenue by product
Banking revenue by product For personal use only 6 months Jun 07 vs Other Jun 07 Dec 06 Jun 06 Jun 06 Asia Pacific Home Loans 1% 10% 14% Home Loans 735 731 701 5% Consumer Finance 590 542 561 5% Lending & Finance Retail Deposits 1,385 1,398 1,306 6% 16% Corporate Banking 460 461 413 11% Retail Depos
Slide 76: CBA growth vs market
Summary - CBA growth vs market* 12 months to June 2007 For personal use only Credit cards Home lending (as at May 07) 15.0% 13.7% 20.0% 18.5% 11.4% 11.7% 10.5% 12.8% 11.3% 15.0% 12.2% 10.0% 9.2% 7.2% 7.6% 10.0% 8.7% 5.0% 7.7% 5.0% 2.0% 0.0% 0.0% CBA WBC ANZ NAB SGB CBA WBC ANZ NAB SGB Personal lendi
Slide 77: CBA growth vs market
Summary - CBA growth vs market* 6 months to June 2007 For personal use only Credit cards Home lending 15.0% 15.0% (as at May 07) 10.0% 10.0% 8.8% 7.0% 7.5% 6.5% 6.7% 6.6% 5.0% 5.4% 6.6% 5.0% 2.6% 1.5% 0.8% 2.7% 0.6% 1.8% 0.0% 0.0% CBA WBC ANZ NAB SGB CBA WBC ANZ NAB SGB Personal lending Household de
Slide 78: Home loans (domestic)
Home loans (domestic) For personal use only Jun 07 vs Jun 07 Dec 06 Jun 06 Jun 06 Domestic growth profile ($bn) Loan funded 27.1 25.1 24.8 9% Reduction 16.5 19.1 16 3% Net growth 10.6 6.0 8.8 20% Total Home lending assets ($b) Australian home lending assets ($b) 161.4 150.8 144.8 11% Securitisation
Slide 79: Home loan balance growth by channel
Home loan balance growth by channel (half year) For personal use only 12% 20% 14.8% 13.3% 11.5% 10% 8% 7.1% 7.0% 6.5% 6.6% 6% 5.8% * 5.4% 4.7% 4.1% 4% 3.0% 3.3% 2.8% 2% 0.01% 0% Jun 06 Dec 06 Jun 07 Brokers Branch Premium Total CBA Total Market * Prior period number restated by APRA 79
Slide 80: Home loan portfolio – stress tested
Home loan portfolio – stress tested For personal use only Stress test scenario consistent with experience of UK recession of the late 1980s / early 1990s. ¾ Up to 6 fold increase in PD, due to Market value stress unemployment of 10% & interest rates of Expected loss 14% $m PD stress factor ¾ Up to
Slide 81: Home loans – LVR profile
Home loans – LVR profile For personal use only Strong LVR profile LVR profile % of loans at <60% LVR: 90% ¾ 68% if based on original 80% 70% security value 60% ¾ 75% if based on current 50% market values 40% ¾ There has been some 30% 20% shift towards the 60-75% 10% LVR group, from the 0% lower
Slide 82: Summary
Summary For personal use only Jun 07 Dec 06 Jun 06 RWA $245,347 $234,569 $216,438m Charge for bad debts (6 mths) $239m $195m $210m Charge for loan impairment to RWA (annualised) 0.20% 0.17% 0.20% Gross impaired assets $421m $338m $326m Individually assessed provisions $199m $171m $171m Collective pr
Slide 83: Home loans – portfolio quality
Home loans – portfolio quality For personal use only 30+ & 90+ day delinquencies Portfolio credit quality remains 1.40% sound 1.20% 1.00% 0.80% In line with seasonal 0.60% 0.40% expectations, delinquencies 0.20% have improved in the last few 0.00% Sep 04 Sep 05 Sep 06 Jun 03 Sep 03 Dec 03 Jun 04
Slide 84: Banking - Top commercial exposures
Banking - Top 20 commercial exposures For personal use only Ra tn i g ($m) BBB- BBB- A- BBB- BBB A S&P Rating or Equivalent BBB+ BBB- BBB BBB+ A- BBB BBB+ A+ A BBB BBB+ A- A B 0 1 00 2 00 3 00 4 00 5 00 6 00 7 00 8 00 9 00 1 ,000 1 ,1 00 1 ,2 00 Top 20 exposures – excludes finance and government – c
Slide 85: The Bank remains well provisioned
The Bank remains well provisioned For personal use only 2,100 550 500 1,800 450 1,500 400 350 $millions 300% 1,200 900 250 200 600 150 100 300 50 0 0 Jun 96 Dec 96 Jun 97 Dec 97 Jun 98 Dec 98 Jun 99 Dec 99 Jun 00* Dec Jun 01 Dec 01 Jun 02 Dec 02 Jun 03 Dec 03 Jun 04 Dec 04 Jun 05 Dec 05 Jun 06 Dec 0
Slide 86: Banking - Quality of commercial risk-rated exposures
Banking - Quality of commercial risk- rated exposures For personal use only Quality of commercial risk-rated exposures: There is security over 82% of the non-investment grade exposure 100% 80% 36 33 34 34 33 32 33 33 60% 15 16 16 16 17 20 20 17 40% 17 18 18 22 20 17 17 17 67% investment grade 20% 35
Slide 87: Banking - total geographic exposure
Banking - total geographic exposure* (commercial + consumer) For personal use only Home loans = $174.7 b (excl securitised) Total exposure : $463b Other balance sheet loans = $146.95 b Other exposure = $141.35 b International 14% At 31 Dec 06 Total exposure = $443b Home loans = $166.0b Other loans =
Slide 88: Banking - total outstandings
Banking - total outstandings* (commercial + consumer) For personal use only At 31 Dec 06 Total outstandings Total outstanding = $359.0b $377.8 b* Consumer = 49.4% Telecoms = 0.2% Telecommunication Agriculture 2.7% Agriculture = 2.6% 0.1% Construction = 1.0% Construction 1.1% Energy = 1.4% Energy 1.2
Slide 89: Banking – international commercial exposures
Banking – international commercial exposures* For personal use only International exposure by Industry At 31 Dec 06 Total exposure = $62.4b Total exposure : $65.7b Finance = 80% Government = 2% Other commercial = 13% Specific industries = 5% Other Commercial 13% Government 2% Specific Industries 5%
Slide 90: Banking credit exposure - agriculture sector
Banking credit exposure - agriculture sector For personal use only At 31 Dec 06 Total exposure: $11,574m Total exposure = $11,011m Australia = 60% New Zealand = 40% 30 Jun 31 Dec 30 Jun 07 06 06 Rating $m $m $m New Zealand AAA to A- 234 255 333 41% BBB+ to BBB- 1,849 1,614 1,320 BB to BB- 3,202 3,15
Slide 91: Banking credit exposure - aviation sector
Banking credit exposure - aviation sector For personal use only At 31 Dec 06 Total exposure: $3,737m Total exposure = $3,828m Australia = 75% New Zealand = 11% Other = 14% 30 Jun 31 Dec 30 Jun 07 06 06 Other 14% Rating $m $m $m New Zealand AAA to A- 952 1,127 1,140 11% BBB+ to BBB- 2,633 2,561 1,516
Slide 92: Banking credit exposure - energy sector
Banking credit exposure - energy sector For personal use only At 31 Dec 06 Total exposure = $7,027m Total exposure: $6,841m Australia = 67.0% New Zealand = 10.9% Asia = 3.2% Europe = 16.2% Americas = 2.7% Americas 30 Jun 31 Dec 30 Jun 6.1% 07 06 06 Europe 14.9% Rating $m $m $m AAA to A- 791 1,140 1,
Slide 93: Banking credit exposure - telcos sector
Banking credit exposure - telcos sector For personal use only At 31 Dec 06 Total exposure = $990m Total exposure: $663m Australia = 75% New Zealand = 6% Europe = 12% Asia = 8% 30 Jun 31 Dec 30 Jun Asia 11% 07 06 06 Europe 0% Rating $m $m $m New Zealand 12% AAA to A- 366 593 856 BBB+ to BBB- 128 134
Slide 94: Funds Management & Insurance
For personal use only Funds Management & Insurance
Slide 95: Investment performance
Investment performance For personal use only Number of funds in each asset class out performing benchmark (3 years) 120% 100% 100% 100% 87% 78% 83% 80% 67% 74% 60% 60% 50% 40% 20% 0% Domestic Global Property Fixed Cash Hedge CFS FSI Total Equities Resources Trusts Interest funds Property 95
Slide 96: Funds Under Administration
Other key information For personal use only Full Year Ended 30 June 2007 Opening Investment Closing balance income & balance Growth Funds Under Administration Jun 06 Netflows other e Jun 07 YOY $m $m $m $m % FirstChoice 26,177 9,196 4,172 39,545 51 Cash management 3,690 (685) 125 3,130 (15) Legacy p
Slide 97: Capital Management
For personal use only Capital Management
Slide 98: ACE calculation
ACE calculation For personal use only Jun 07 Dec 06 Jun 06 Adjusted Common Equity * $m $m $m Tier One capital 17,512 16,553 16,354 Add: Deferred income tax 37 39 - Equity investments in other companies 700 820 - Deduct: Eligible loan capital (245) (263) (281) Other hybrid equity instruments (3,474)
Slide 99: ACE movement in half year ended June 2007
ACE movement in half year ended June 2007 For personal use only 6.0% 0.95% (0.79%) 5.5% 0.11% (0.22%) 0.20% (0.05%) 5.0% (0.11%) 4.79% 4.70% 4.5% 4.0% 3.5% 3.0% ACE Dec Cash Ordinary DRP a DRP b Growth in Investment Other c ACE Jun 2006 NPAT Dividends $485m $270m RWA in non ($262m) 2007 $11,029m $2,
Slide 100: Tier movement in half year June 2007
Tier 1 movement in half year June 2007 For personal use only 9.0% 8.5% 0.95% (0.79%) 8.0% 7.5% (0.31%) 0.11% (0.08%) d 0.20% 7.14% 7.06% 7.0% 6.5% 6.0% 5.5% 5.0% Tier 1 Cash Ord. Growth in DRP a DRP b Currency and Tier 1 Dec 2006 NPAT Dividends RWA $485m $270m Other Jun 2007 $16,553m $2,333m ($1,939
Slide 101: Hybrid instrument information
Hybrid instrument information For personal use only Hybrid dividends Franked/ Jun 07 Dec 06 Jun 06 Imputed PERLS I - - 13 PERLS II 19 19 18 F PERLS III 31 29 13 F Trust Preferred Securities 2003 17 21 22 N/A Trust Preferred Securities 2006 27 27 - N/A ASB Capital prefs 5 5 5 I ASB Capital No.2 prefs
Slide 102: Results Presentation closing slide
For personal use only Ralph Norris CHIEF EXECUTIVE OFFICER David Craig CHIEF FINANCIAL OFFICER 15 August 2007 Commonwealth Bank of Australia ACN 123 123 124 RESULTS PRESENTATION FOR THE FULL YEAR Ended 30 June 2007
Commonwealth Bank of Australia — FY2007 Earnings Presentation on 6ix