Westpac Banking Corporation · ASX:WBC

Westpac Banking — 2012 Morgan Stanley Financials Forum

21 slides from Westpac Banking's conference presentation, Sep 20, 2012

  1. Slide 1: St.George Banking Group 2012 Morgan Stanley Financials Forum

    For personal use only St.George Banking Group 2012 Morgan Stanley Financials Forum George Frazis Chief Executive Morgan Stanley Financials Forum - St.George Banking Group, September 2012

  2. Slide 2: St.George represents 18% of Westpac Cash earnings

    St.George represents 18%1 of Westpac Cash earnings For personal use only St.George is home to three regional brands and a specialist national brand. Brands are locally managed with differentiated strategies Bank of St.George BankSA Melbourne RAMS  In NSW/ACT aims to  Banks nearly 1 in 3  Meeting

  3. Slide 3: Repositioning complete, into profitable growth phase

    Repositioning complete, into profitable growth phase For personal use only Repositioned the business to reduce commercial Repositioned property exposure and ensure the business remains the local/regional alternative to the major banks Multi-brand better supports customers and provides Efficient acce

  4. Slide 4: Repositioning led to subdued core earnings growth

    Repositioning led to subdued core earnings growth For personal use only  Core earnings relatively flat over last 3 years Core earnings ($bn)  Headwinds largely due to – Commercial property exposure reducing 15 1.06 percentage points to 34% of business TCE 1.04 1.04 1.03 – Reduction in flows from b

  5. Slide 5: Brands provide efficient access to more customers

    Brands provide efficient access to more customers For personal use only  Multi-brand gives access to more customers Local Bank footings by State1 (%) – Around 50% of Australians prefer a local bank 30 Local banks outside home state – Local banks hold ~ 20-25% share in each State 25 Local Banks in h

  6. Slide 6: Priorities to deliver profitable growth

    Priorities to deliver profitable growth For personal use only 1 Improve banker capability to have the best bankers 2 Build ‘MyBank1’ customer base, particularly with wealth 3 Grow under represented SME customer base 4 Be a leader in innovation 1 MyBank customers are defined on slide 8. Morgan Stanle

  7. Slide 7: Improve bank capability to have the best bankers

    Improve bank capability to have the best bankers For personal use only Build  Increase specific technical skills capability training technical/credit  Roll-out enhanced credit risk training across business banking skills  Increase sales leadership training  Better align reward/recognition framew

  8. Slide 8: Build 'MyBank' customer base, particularly wealth

    Build ‘MyBank’ customer base, particularly wealth For personal use only ‘MyBank’ customer attributes Three features of a ‘MyBank’ customer  St.George is focused on increasing the portion of customers that consider St.George to be ‘MyBank’ Transaction account with a  ‘MyBank’ customers consider St.

  9. Slide 9: Grow under represented SME customer base

    Grow under represented SME customer base For personal use only  St.George has a strong commercial business offer but the SME Current Current position position segment is under served  A significant growth opportunity to grow this segment  New hub distribution model focused on efficient access to

  10. Slide 10: Be a leader in innovation

    Be a leader in innovation For personal use only Become better/simpler in Mobile/online leadership everything we do  Improve Time to “Yes” and  Leverage strong heritage of Right first time online/mobile capability – First internet banking (1995)  Simplify products – First to send SMS alerts (2003)

  11. Slide 11: Leverage new AFS structure to deliver better returns

    Leverage new AFS structure to deliver better returns For personal use only  Enhance brand distinctiveness to maximise customer coverage  Leverage best practice across brands  Better co-ordinated marketing approach  Maximise shared services and share infrastructure investment across brands  Prod

  12. Slide 12: Encouraging early signs of momentum

    Encouraging early signs of momentum For personal use only  New growth strategy is re- Housing lending growth (% annualised) energising the network and 6% contributed to improved sales momentum across both deposits 3% and lending 1H12 2H12 (5 months) Total deposit growth (% annualised) Business lend

  13. Slide 13: Summary

    Summary For personal use only  Repositioning of St.George complete with momentum emerging  Multiple brands provide efficient access to more customers, leveraging the scale of the broader Group  Four strategic priorities to enhance growth/return mix – Enhance banker capability – Build ‘MyBank1’ cu

  14. Slide 14: Appendix

    For personal use only St.George Banking Group 2012 Morgan Stanley Financials Forum Appendix Morgan Stanley Financials Forum - St.George Banking Group, September 2012

  15. Slide 15: St.George Management Team

    St.George Management Team For personal use only George Frazis, Chief Executive Officer Jane Andrew Scott Phillip Melos Peter David Tara Dhiren Sivea Kittel Fell Tanner Godkin Sulicich Sarantzouklis Malcolm McKnight Kulkarni Pascale MD, GM, Chief GM Chief CFO Chief Risk Head of CIO & SBG Head of Bank

  16. Slide 16: St.George Core earnings steady since merger, absorbing business repositioning

    St.George Core earnings steady since merger, absorbing business repositioning For personal use only Cash earnings movement half on half ($m) Movement 1H12 – 2H11 17 Cash 52 (19) (33)  7%  Cash earnings down 7% to $569m 615 (41) earnings 602 (4) (3) 8 (27) 569 Core 17  3%  Core earnings down 3% t

  17. Slide 17: Solid improvement in key operating metrics with wealth cross sell up significantly

    Solid improvement in key operating metrics with wealth cross sell up significantly For personal use only Key features of 1H12 Key metrics  St.George has continued to deepen customer relationships and has had good early success with Change on the launch of Bank of Melbourne and growth of the RAMS pr

  18. Slide 18: Strong performance in wealth/insurance cross sell

    Strong performance in wealth/insurance cross sell For personal use only  Wealth penetration improved 310bps to 13.9% in last 2 years, strong improvement relative to peers Wealth penetration significant improvement1 but more to do WRBB St.George Peer 1 Peer 2 Peer 3  Home & Content cross sell rates

  19. Slide 19: Strong deposit and proprietary lending growth in 1H12

    Strong deposit and proprietary lending growth in 1H12 For personal use only  Strong deposit growth exceeded loan growth   Improving the deposits to loans ratio 180bps to 51.7% Deposit growth of 5% driven by term deposits up 13% (now represent 52% of total deposits) Balance sheet ($bn)  Mortgages

  20. Slide 20: Solid risk profile

    Solid risk profile For personal use only Improving risk profile at 1H12 compared to 2H Movement in impairment charges ($m)  Asset quality has continued to improve with stressed exposures to TCE1 down 18bps to 329bps. Impaired assets declined the most, down 15bps 185 240 213 (132)  Mortgage 90+ day

  21. Slide 21: Definitions and Disclaimer

    Definitions and Disclaimer For personal use only DEFINITIONS: Wealth Penetration Metrics: Data based on Roy Morgan Research, Respondents aged 14+. Wealth penetration is defined as the number of Australians who have Managed Investments, Superannuation or Insurance with each financial services group (

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