Anz Group Holdings Limited · ASX:ANZ
Anz — Debt Investor Presentation (May 2023)
110 slides from Anz's debt investor presentation, May 2023
Slide 1: 2023 Half Year Results – Debt Investor Presentation
2023 HALF YEAR RESULTS HALF YEAR ENDED 31 MARCH 2023 DEBT INVESTOR PRESENTATION Approved for distribution by ANZ’s Continuous Disclosure Committee ANZ Group Holdings Limited ABN 16 659 510 791 9/833 Collins Street Docklands Victoria 3008 Australia
Slide 2: Disclaimer & Important Notice
ANZ 2023 Half Year Debt Investor Presentation DISCLAIMER & IMPORTANT NOTICE Background information only The information set out in this document and any accompanying verbal presentation including any question and answer session and any documents or other materials distributed with the presentation (
Slide 3: Disclaimer & Important Notice
ANZ 2023 Half Year Debt Investor Presentation DISCLAIMER & IMPORTANT NOTICE United Kingdom ("UK"): The communication of this document is not being made by, and the content of this document has not been approved by an authorised person for the purposes of section 21 of the UK’s Financial Services and
Slide 4: Disclaimer & Important Notice
ANZ 2023 Half Year Debt Investor Presentation DISCLAIMER & IMPORTANT NOTICE Document subject to change The information contained in this document is provided as at the date of this document and is subject to change without notice. Neither the Bank, nor any of its affiliates, agents, employees or adv
Slide 5: Contents
ANZ 2023 Half Year Debt Investor Presentation Results Presentations Chief Executive Officer (CEO) 5 Chief Financial Officer (CFO) 13 Investor Discussion Pack Environment, Social & Governance (ESG) 23 CONTENTS Group Performance 32 Divisional Performance 45 Treasury 57 Risk Management 71 Note on recon
Slide 6: 2023 Half Year Results – Shayne Elliott, CEO
2023 HALF YEAR RESULTS SHAYNE ELLIOTT CHIEF EXECUTIVE OFFICER
Slide 7: 1H23 Group Financial Results
ANZ 2023 Half Year Debt Investor Presentation 1H23 GROUP FINANCIAL RESULTS 1H23 vs 2H22 vs 1H22 Statutory profit, $ million 3,547 -1% 0% Continuing operations Cash Profit, $ million 3,821 +12% +23% Return on equity, % 11.4% +60bps +140bps Earnings per share - basic, cents 127.6 +7% +16% Dividend per
Slide 8: Performance Overview
ANZ 2023 Half Year Debt Investor Presentation PERFORMANCE OVERVIEW Returns Tangible Assets Capital Strength Risk Profile Return on Equity, % NTA / Share, $ APRA Level 2 CET1 Ratio1, % Internal Expected Loss2, bps 11.4 21.66 13.2 20 10.8 19 10.0 12.3 20.75 17 20.64 11.5 1H22 2H22 1H23 Mar 22 Sep 22 M
Slide 9: Divisional Performance – 1H23 vs 1H22 (pcp)
ANZ 2023 Half Year Debt Investor Presentation DIVISIONAL PERFORMANCE – 1H23 VS 1H22 (PCP) Cash continuing operations New Zealand Aus. Retail Aus. Commercial2 Institutional Total Group (1H23 vs 1H22) (NZD) Capital allocated1 ~30% ~10% ~40% ~20% Revenue +11% +30% +35% +14% +18% Expenses 0% +7% +4% -1%
Slide 10: Australia Retail – ANZ Plus
ANZ 2023 Half Year Debt Investor Presentation AUSTRALIA RETAIL – ANZ PLUS ANZ Plus customers and deposits, cumulative A more digital and efficient experience, Mar 23 Digitally verified1 Onboarding effort2 Customers, ‘000s Deposits, $b 90% -9x 72% 300 6 250 5 ANZ ANZ Plus ANZ ANZ Plus 200 4 Onboardin
Slide 11: The World Is Being Shaped by Major Trends
ANZ 2023 Half Year Debt Investor Presentation THE WORLD IS BEING SHAPED BY MAJOR TRENDS Major trends Challenges arising • Greater demands on government, more government debt • Heightened community expectations of business and government • Resilient corporate balance sheets • Government fiscal priori
Slide 12: Continued Proactive Portfolio Rebalancing
ANZ 2023 Half Year Debt Investor Presentation CONTINUED PROACTIVE PORTFOLIO REBALANCING Capital allocation across ANZ divisions1 Run for performance Transform for long term differentiation & growth Institutional Australia Retail Australia Commercial New Zealand Retail & Commercial 1. Subset of total
Slide 13: Group Strategic Achievements
ANZ 2023 Half Year Debt Investor Presentation GROUP STRATEGIC ACHIEVEMENTS Group Australia Retail & Australia Commercial 1. Suncorp acquisition on track 1. ANZ Plus reached 259k in customers & $6.1b in FUM1 2. NOHC structure approved by shareholders and in place 2. ANZ Plus Home Loan moved to Beta t
Slide 14: 2023 Half Year Results – Farhan Faruqui, CFO
2023 HALF YEAR RESULTS FARHAN FARUQUI CHIEF FINANCIAL OFFICER
Slide 15: 1H23 Financial Performance
ANZ 2023 Half Year Debt Investor Presentation 1H23 FINANCIAL PERFORMANCE Operating income, $m Operating expenses, $m Profit before provisions, $m +10% +4% +15% 10,528 4,791 4,788 4,997 5,531 8,948 9,599 4,811 4,157 +18% +4% +33% 1H22 2H22 1H23 1H22 2H22 1H23 1H22 2H22 1H23 Cash NPAT, $m Cash EPS, ce
Slide 16: Operating Income
ANZ 2023 Half Year Debt Investor Presentation OPERATING INCOME Total operating income, $m Income growth, 1H23 vs 2H22 394 10% 23% 13% 10,528 4% 555 1% -321 Aus. Retail Aus. Comm Institutional NZ (NZD) 301 9,599 Risk adjusted margins1,2, % 6.18 6.28 6.43 8.06 8.37 7.05 Aus. Retail Aus. Comm 2.78 2.94
Slide 17: Volumes
ANZ 2023 Half Year Debt Investor Presentation VOLUMES Net loans & advances, $b +4% +1% excluding 284.6 290.3 300.6 +1% Asset Finance Total Group reductions 0% 188.2 207.2 208.3 3% 0% 125.2 128.6 128.4 57.6 59.7 59.9 Mar 23 vs Sep 22 Australia Retail Australia Commercial Institutional New Zealand (NZ
Slide 18: 1H23 Net Interest Margin – Customer Deposits
ANZ 2023 Half Year Debt Investor Presentation 1H23 NET INTEREST MARGIN (NIM) – CUSTOMER DEPOSITS Customer deposit portfolio contribution to 1H23 NIM (excl. replicating balances)1, $b 571 Group NIM movement contributions in 1H23 2 535 Term Deposits AUD +2bps Non- Term AUD 37% 44% Deposits Total Group
Slide 19: 1H23 Net Interest Margin – Movement
ANZ 2023 Half Year Debt Investor Presentation 1H23 NET INTEREST MARGIN (NIM) – MOVEMENT Group NIM, bps 7 183 20 -2 175 -3 -6 168 -9 Higher funding costs relating to revenue recorded in Other Aus housing -6 Aus Retail +6 Operating NZ housing -2 NZ Retail +2 Income. Overall Other -1 Corp/Inst. +12 acc
Slide 20: Net Interest Margin & Risk Adjusted Margin
ANZ 2023 Half Year Debt Investor Presentation NET INTEREST MARGIN (NIM) & RISK ADJUSTED MARGIN Indexed data, FY16 = 100 115 Risk Adjusted Margin excl. Markets1 110 1H23: 65bps above FY16, mainly reflects the 105 benefits from ongoing portfolio de-risking and risk management 100 discipline 95 Group N
Slide 21: Markets Income
ANZ 2023 Half Year Debt Investor Presentation MARKETS INCOME Total Markets income, $m Customer franchise income, $m 1,149 36 757 1,013 26 112 678 356 812 590 103 755 309 575 80 32 53 53 49 223 206 30 158 111 195 181 757 678 590 575 > 407 381 324 331 -1 -26 1H22 2H22 1H23 Half Year avg 1H22 2H22 1H23
Slide 22: Credit Quality
ANZ 2023 Half Year Debt Investor Presentation CREDIT QUALITY Individual Provision Charge / Avg. Gross Loans & Advances1, % Substantially reshaped our portfolio since 2016 0.35 • Sold or exited >30 businesses 0.30 • Grown in “lower loss” portfolios: 0.25 • Sovereign • Mortgage 0.20 • Bank • Investmen
Slide 23: Capital, Liquidity & Funding
ANZ 2023 Half Year Debt Investor Presentation CAPITAL, LIQUIDITY & FUNDING Capital, APRA CET1 ratio, Mar 23 Funding Liquidity Wholesale Deposit NSFR HQLA LCR funding diversification 13.2% ~12.1% ~12.3% $26b 100% 119% $285b 128% Aus. 100% Retail 24% 100% Aus. Comm. 17% Cash 182 NZ / Pacific 16% Insti
Slide 24: Investor Discussion Pack – ESG
2023 HALF YEAR RESULTS INVESTOR DISCUSSION PACK ENVIRONMENT, SOCIAL & GOVERNANCE (ESG)
Slide 25: Accelerating Our Approach for the Transition to Net Zero
ANZ 2023 Half Year Debt Investor Presentation ACCELERATING OUR APPROACH FOR THE TRANSITION TO NET ZERO New social and environmental Progress against our sectoral Our Climate Change sustainability target decarbonisation targets Commitment • We were the first Australian bank to join the Net- • Our pat
Slide 26: Finance to Back Customers on the Right Path
ANZ 2023 Half Year Debt Investor Presentation FINANCE TO BACK CUSTOMERS ON THE RIGHT PATH Targets set for six carbon intensive sectors in line with our Net-Zero Banking Alliance commitments (as at 30 September 2022) Power generation Commercial Real Estate – Office Buildings Commercial Real Estate –
Slide 27: Finance to Back Customers on the Right Path
ANZ 2023 Half Year Debt Investor Presentation FINANCE TO BACK CUSTOMERS ON THE RIGHT PATH Targets set for six carbon intensive sectors in line with our Net-Zero Banking Alliance commitments (as at 30 September 2022) Oil and Gas Aluminium Absolute Emissions (Mt CO2-e) GHG1 Intensity (tCO2-e/t alumini
Slide 28: Our Resources Portfolio
ANZ 2023 Half Year Debt Investor Presentation OUR RESOURCES PORTFOLIO Resources Portfolio, EAD1 $b Thermal Coal Mining, EAD1 $b 2.0 20.0 1.5 1.7 1.0 0.6 17.3 17.0 0.5 1.3 16.2 0.8 0.5 15.3 0.7 0.8 0.0 1.2 1.0 0.9 14.5 Sep Sep Sep Sep Mar Sep Mar Sep Mar Sep Mar Sep Mar 2.9 0.4 14.0 0.7 15 16 17 18 1
Slide 29: Customer Engagement to Support Emissions Reductions
ANZ 2023 Half Year Debt Investor Presentation CUSTOMER ENGAGEMENT TO SUPPORT EMISSIONS REDUCTIONS 100 of our largest emitting business customers (progress at 30 September) 100 of our largest emitting business customers We have been discussing transition plans with 100 of our largest emitting busines
Slide 30: Snapshot of Half Year ESG Target Performance
ANZ 2023 Half Year Debt Investor Presentation SNAPSHOT OF HALF YEAR ESG TARGET PERFORMANCE ESG target Progress Relevant SDGs Since October 2019, we have funded and facilitated AU$47.09 billion to Environmental Sustainability support sustainable solutions for our customers. We were forecast to Fund a
Slide 31: Snapshot of Half Year ESG Target Performance (cont.)
ANZ 2023 Half Year Debt Investor Presentation SNAPSHOT OF HALF YEAR ESG TARGET PERFORMANCE (CONT.) ESG target Progress Relevant SDGs Housing Fund and facilitate AU$10 billion of investment by 2030 to deliver more Since October 2018, we have funded and facilitated over AU$4.4 billion affordable, acce
Slide 32: Investing in Sustainability
ANZ 2023 Half Year Debt Investor Presentation INVESTING IN SUSTAINABILITY Where we support our customers Sustainable Bond League Tables ANZ Sustainable Finance deals3 Aus. Sustainable Bond Cumulative League Table1 Supporting sustainability in Bookrunner Number of deals Number of deals Volume No. of
Slide 33: Investor Discussion Pack – Group Performance
2023 HALF YEAR RESULTS INVESTOR DISCUSSION PACK GROUP PERFORMANCE
Slide 34: Balance Sheet Composition
ANZ 2023 Half Year Debt Investor Presentation BALANCE SHEET COMPOSITION Exposure at default1, EOP $b Risk weighted assets, EOP $b Net loans & advances, EOP $b Customer deposits, EOP $b 1,193 455 690 649 672 620 1,152 438 2% 436 651 0% 611 1% 1,103 8% 0% 1% 2% 4% 1% 1% 7% 13% 17% 15% 8% 14% 17% 15% 1
Slide 35: Net Loans and Advances
ANZ 2023 Half Year Debt Investor Presentation NET LOANS AND ADVANCES Australia Retail, $b Australia Commercial, $b New Zealand, NZDb Institutional, $b +4% 0% +1% 0% 301 60 60 207 208 285 290 58 125 129 128 6 2 1 6 6 1 188 26 25 41 41 24 18 20 20 34 1 2 1 284 295 278 145 149 101 102 136 100 39 39 39
Slide 36: Customer Deposits
ANZ 2023 Half Year Debt Investor Presentation CUSTOMER DEPOSITS Australia Retail, $b Australia Commercial, $b New Zealand, NZDb Institutional, $b +4% 0% +6% +1% 156 116 105 278 112 113 104 104 263 147 150 1 247 2 19 44 21 2 27 41 43 34 38 42 106 128 102 14 16 28 67 22 61 22 57 22 38 29 46 66 65 62 4
Slide 37: Customer Deposits – Retail & Commercial Long Term Trend
ANZ 2023 Half Year Debt Investor Presentation CUSTOMER DEPOSITS – RETAIL & COMMERCIAL LONG TERM TREND Australia Retail, $b Australia Commercial, $b New Zealand, NZDb 156 116 104 104 105 150 111 112 113 147 97 97 99 141 107 101 16% 92 134 135 19% 24% 89 28% 19% 88 123 28% 29% 23% 33% 37% 121 90 40% 1
Slide 38: Total Operating Income
ANZ 2023 Half Year Debt Investor Presentation TOTAL OPERATING INCOME Total income, $b Net interest income, $b Other operating income, $b 10.5 8.5 2.0 0.2 0.2 0.1 9.6 7.8 1.8 1.8 0.0 8.9 0.3 1.8 0.1 0.1 7.1 1.6 0.1 0.2 0.1 1.7 1.5 1.6 0.4 0.3 1.4 0.9 3.4 2.1 1.9 2.8 2.6 1.8 1.6 1.0 1.4 1.0 1.6 1.8 1.
Slide 39: Reported Group Net Interest Margin Trend
ANZ 2023 Half Year Debt Investor Presentation REPORTED GROUP NET INTEREST MARGIN TREND1 Group NIM, bps Outlook considerations 240 220 200 Tailwinds 180 • Higher capital & replicated 160 deposit earnings 140 • Potential for further rate tightening across geographies 120 100 80 Headwinds 60 • Lending
Slide 40: Recent NIM Trajectory Not Uniform Across the Group
ANZ 2023 Half Year Debt Investor Presentation THE RECENT TRAJECTORY ON NIM IS NOT UNIFORM ACROSS THE GROUP Quarterly Net Interest Margin trends – Group ex Markets and Treasury Diversified portfolio of businesses and access to opportunities in overseas markets offers a degree of relative margin stabi
Slide 41: Ongoing Margin Tailwinds from Capital and Replicated Portfolio
ANZ 2023 Half Year Debt Investor Presentation ONGOING MARGIN TAILWINDS FROM OUR CAPITAL AND REPLICATED PORTFOLIO Portfolio balance, $b Portfolio interest earning rates impact 3 Illustrative potential NII benefit 142 141 Prospective benefit4 from higher 134 3.8% Further benefits are interest earning
Slide 42: Interest Rate Sensitivity
ANZ 2023 Half Year Debt Investor Presentation INTEREST RATE SENSITIVITY Illustrative path & magnitude of movements Short term interest rate outlook – based on ANZ research forecasts1 Interest Rate Forecasts (%) Jun 23 Sep 23 Dec 23 Mar 24 Jun 24 Sep 24 Dec 24 RBA Cash Rate 3.85 4.10 4.10 4.10 4.10 4
Slide 43: Operating Expenses
ANZ 2023 Half Year Debt Investor Presentation OPERATING EXPENSES Total operating expenses, $m 3.7% 131 FY23 expense 231 91 4,997 expectations 4,906 4,788 30 4,818 It remains likely that total -274 expenses will increase by circa 5% in FY23 (off FY22 base of $9.17b) on a constant currency basis +1.8%
Slide 44: Operating Expenses
ANZ 2023 Half Year Debt Investor Presentation OPERATING EXPENSES Total expenses1, $b Total expenses by category, $b Full time equivalent staff1,2,‘000s 5.0 5.0 39.7 39.2 39.8 4.8 4.8 4.8 4.8 1.1 1.0 1.1 0.6 0.5 0.6 0.9 0.9 0.9 0.1 10.3 10.3 10.8 0.7 0.6 0.6 0.0 0.1 0.8 0.8 0.8 1.3 1.3 0.3 6.9 6.8 6.
Slide 45: Large / Notable Items
ANZ 2023 Half Year Debt Investor Presentation LARGE / NOTABLE ITEMS Customer Remediation, $m Large / Notable items, $m Continuing Operations Pre-Tax 1H22 2H22 1H23 1H23 movement vs 2H22 vs 1H22 485 (HoH) $m (PcP) $m Cash Profit impact (41) (113) (161) (48) (120) 119 Business divestments/closures 249
Slide 46: Investor Discussion Pack – Divisional Performance
2023 HALF YEAR RESULTS INVESTOR DISCUSSION PACK DIVISIONAL PERFORMANCE
Slide 47: Australia Retail – Financial Performance
ANZ 2023 Half Year Debt Investor Presentation AUSTRALIA RETAIL – FINANCIAL PERFORMANCE Balance Sheet Income Expenses / FTE Credit Quality / RWAs Profit & Returns NLAs, $b NII/OOI Contribution, $m Expenses, $m Total Provision Charge, $m Cash Profit, $m 301 3,174 3,299 1,741 1,745 82 1,072 1,026 2,975
Slide 48: Australia Retail – Loans & Deposits
ANZ 2023 Half Year Debt Investor Presentation AUSTRALIA RETAIL – LOANS & DEPOSITS Lending composition, $b Deposit composition, $b 301 150 156 141 147 290 6 23 284 285 23 26 26 6 6 6 44 39 41 43 278 278 284 295 16 14 16 28 63 66 65 62 Sep 21 Mar 22 Sep 22 Mar 23 Sep 21 Mar 22 Sep 22 Mar 23 Home Loans
Slide 49: Australia Commercial – Financial Performance
ANZ 2023 Half Year Debt Investor Presentation AUSTRALIA COMMERCIAL – FINANCIAL PERFORMANCE Balance Sheet Income Expenses / FTE Credit Quality / RWAs Profit & Returns NLAs1, $b NII/OOI Contribution, $m Expenses, $m Total Provision Charge, $m Cash Profit, $m 59 59 1,807 685 66 883 56 1,635 1,595 649 6
Slide 50: Australia Commercial – Loans & Deposits
ANZ 2023 Half Year Debt Investor Presentation AUSTRALIA COMMERCIAL – LOANS & DEPOSITS Lending composition1, $b Deposit composition, $b 59 111 116 112 113 56 56 59 1 1 1 1 28 30 30 29 17 18 20 20 21 19 21 27 38 38 39 39 62 67 61 57 Sep 21 Mar 22 Sep 22 Mar 23 Sep 21 Mar 22 Sep 22 Mar 23 SME Banking S
Slide 51: Australia Commercial – Book Composition & Risk Weight Intensity
ANZ 2023 Half Year Debt Investor Presentation AUSTRALIA COMMERCIAL – BOOK COMPOSITION & RISK WEIGHT INTENSITY Diversified portfolio – Geographical view Security profile Mar 23 % of Exposure at Default (EAD)1 % of Exposure at Default (EAD)2,3 5% 5% 3% 5% 3% 5% 3% 5% 13% 13% 13% 12% 11% 8% 29% VIC/TAS
Slide 52: New Zealand Division – Financial Performance
ANZ 2023 Half Year Debt Investor Presentation NEW ZEALAND DIVISION – FINANCIAL PERFORMANCE Balance Sheet1 Income1 Expenses / FTE Credit Quality / RWAs Profit & Returns NLAs2 & NIM, NZDb NII/OOI Contribution, NZDm Expenses, NZDm Total Provision Charge, NZDm Cash Profit, NZDm 1,912 1,937 689 688 685 8
Slide 53: New Zealand Division – Balance Sheet
ANZ 2023 Half Year Debt Investor Presentation NEW ZEALAND DIVISION – BALANCE SHEET Housing 1 Business2 Agri ANZ Performance (NZDb) ANZ Performance (NZDb) ANZ Performance (NZDb) 150 15 30 103.1 104.2 104.6 100 10 6.9 7.3 7.3 20 15.7 15.4 15.1 50 5 10 0 0 0 Mar 22 Sep 22 Mar 23 Mar 22 Sep 22 Mar 23 Ma
Slide 54: Australia & New Zealand 90+ Days Past Due
ANZ 2023 Half Year Debt Investor Presentation AUSTRALIA & NEW ZEALAND 90+ DAYS PAST DUE (DPD) Consumer portfolio1 90+ DPD as a % of total portfolio balances 1.50 1.25 1.00 0.75 0.50 0.25 0.00 Sep Dec Mar Jun Sep Dec Mar Jun Sep Dec Mar Jun Sep Dec Mar Jun Sep Dec Mar 18 18 19 19 19 19 20 20 20 20 21
Slide 55: Institutional – Financial Performance
ANZ 2023 Half Year Debt Investor Presentation INSTITUTIONAL – FINANCIAL PERFORMANCE Balance Sheet Income Expenses & FTE Credit Quality & RWA Profit & Returns NLAs1, $b & Margins, % Product Composition3, $m Expenses, $m Total Provision Charge, $m Cash Profit, $m 1,597 3,444 1,273 1,293 1,328 2,793 1
Slide 56: Institutional – Income & Asset Composition
ANZ 2023 Half Year Debt Investor Presentation INSTITUTIONAL – INCOME & ASSET COMPOSITION Income composition by product1, $m Net loans and advances, $b 3,444 207 208 2,671 2,793 188 2,593 2,555 1,149 171 41 41 160 34 755 27 21 19 1,040 931 812 16 28 17 19 15 672 862 14 18 14 452 Ex Markets 457 460 21
Slide 57: Institutional – Markets Income Composition
ANZ 2023 Half Year Debt Investor Presentation INSTITUTIONAL – MARKETS INCOME COMPOSITION Markets Income composition, $m Markets avg. Value at Risk (99% VaR), $m 1,490 Both Traded and Non-Traded VaR increased reflecting periods of higher 131 market volatility driven by market shocks and revised rate
Slide 58: Investor Discussion Pack – Treasury
2023 HALF YEAR RESULTS INVESTOR DISCUSSION PACK TREASURY
Slide 59: ANZ Group Capital
ANZ 2023 Half Year Debt Investor Presentation ANZ GROUP CAPITAL ANZ Group Capital Composition, $b ANZ Bank Group Key Capital Ratios (%) Mar 22 Sep 22 Mar 231 Level 2 CET1 capital ratio 11.5 12.3 13.2 90.6 CET1 Composition 82.8 Level 2 CET1 HoH mvmt -81 bps +76 bps +89 bps 0.7 72.8 Additional Tier 1
Slide 60: Regulatory Capital – 1H23 Update
ANZ 2023 Half Year Debt Investor Presentation REGULATORY CAPITAL – 1H23 UPDATE ANZ Bank Group Capital update ANZ Group Dividend ● Level 2 CET1 ratio of 13.2% (18.9% on an Internationally Comparable basis1) or ~12.1% ● Interim Dividend of 81 cents fully franked, ~64% DPOR on 1H23 Cash profit from on
Slide 61: Basel III CET1 Reforms
ANZ 2023 Half Year Debt Investor Presentation BASEL III CET1 REFORMS APRA CET1 capital ratio – Basel III Capital Reforms Unquestionably strong ANZ position Equivalent to 5.8% reduction in RWA 7.6% reduction in RWA +100bps 16bps Op RWA1 At reporting date 11.25% +75bps Regulatory min. 11.0% 71bps Cred
Slide 62: Basel III CET1 Reforms and TLAC Finalisation
ANZ 2023 Half Year Debt Investor Presentation BASEL III CET1 REFORMS AND TLAC FINALISATION APRA CET1 reforms Updated minimum capital requirements, % • APRA Capital Reforms took effect from 1 January 2023 with benefits from reduction in RWA partially offset by increased capital buffers 19.25% • Enhan
Slide 63: Regulatory Capital – Risk Weighted Assets
ANZ 2023 Half Year Debt Investor Presentation REGULATORY CAPITAL – RISK WEIGHTED ASSETS Risk weighted assets – Level 2, $b Total Credit RWA increase $14.3b (excluding Capital Reform impact) Total Capital Reform 8.8 1.3 1.5 0.4 Impacts 454.7 2.7 457.4 -3.7 -6.0 4.3 435.5 -28.5 Sep 22 FX impacts Sep 2
Slide 64: Internationally Comparable Regulatory Capital Position
ANZ 2023 Half Year Debt Investor Presentation INTERNATIONALLY COMPARABLE1 REGULATORY CAPITAL POSITION Level 2 capital ratio (APRA vs internationally comparable)2, % 29.0 27.3 24.9 5.8 7.4 4.6 20.6 16.6 2.5 18.2 2.3 2.6 5.5 3.4 4.2 1.7 1.9 1.7 18.0 19.2 18.9 11.5 12.3 13.2 APRA Int. Comparable APRA I
Slide 65: Balance Sheet Structure
ANZ 2023 Half Year Debt Investor Presentation BALANCE SHEET STRUCTURE1 Pro forma NSFR is ~116.3% once RSF benefit NSFR movement, % associated with TFF is removed Balance sheet composition, Mar 23 1.9 119.1 2.0 118.6 0.5 -0.8 -4.1 Offshore Short Term W’sale Debt 4% Domestic Short Term Wholesale Debt
Slide 66: Liquidity Coverage Ratio (LCR) Summary
ANZ 2023 Half Year Debt Investor Presentation LIQUIDITY COVERAGE RATIO (LCR) SUMMARY1 Movement in average LCR surplus2, $b LCR composition, Average 1H23 $b 2H22 1H23 Offshore short-dated Financial Avg LCR 129% 3 Avg LCR 128% 28 Institution (FI) deposits are typically placed with Central Banks. Whils
Slide 67: Term Wholesale Funding Portfolio
ANZ 2023 Half Year Debt Investor Presentation TERM WHOLESALE FUNDING PORTFOLIO1 Issuance, $b 1H23 maturities of $12b. Maturities, $b Excludes $2.4b Covered Bond trade 32 settled on 4 April 2023 (matures FY25) 28 24 25 24 22 22 21 21 17 19 16 8 8 9 2 FY16 FY17 FY18 FY19 FY20 FY21 FY22 1H23 2H23 FY24
Slide 68: Tier 2 Capital Profile
ANZ 2023 Half Year Debt Investor Presentation TIER 2 CAPITAL PROFILE1 ANZ’s Tier 2 capital requirement to progressively Tier 2 capital, Notional amount % increase to meet TLAC requirement • ANZBGL has issued $19.7b since July 2019 across AUD, EUR, GBP, JPY, SGD and USD • APRA announced a finalised T
Slide 69: Capital & Replicating Deposits Portfolio
ANZ 2023 Half Year Debt Investor Presentation CAPITAL & REPLICATING DEPOSITS PORTFOLIO Australia, % Portfolio earnings rate, Average % 4 Portfolio Earnings Rate is a combination of term swap rates (hedged component) and Australia New Zealand 3 3mth BBSW (unhedged) 1H20 1.64% 1.88% 2 2H20 1.20% 1.40%
Slide 70: Australian TLAC in a Global Context
ANZ 2023 Half Year Debt Investor Presentation AUSTRALIAN TLAC IN A GLOBAL CONTEXT Australian banks’ Tier 2 is supported by large amounts of CET1 and AT1 capital Australia Canada Scandinavia Netherlands France Singapore % RWA 40 35 30 25 ANZ Tier 2 20 15 10 5 0 ANZ Westpac CBA NAB BMO TD Bank RBC CIB
Slide 71: Capital & Liquidity Framework
ANZ 2023 Half Year Debt Investor Presentation CAPITAL & LIQUIDITY FRAMEWORK1 First Half CY2023 Second Half CY2023 CY2024 Implementation Date RBNZ Capital Framework Transition 2028 Fundamental Review of the Trading Book (incl. Consultation 2026 Counterparty Credit Risk) Interest Rate Risk in the Bank
Slide 72: Investor Discussion Pack – Risk Management
2023 HALF YEAR RESULTS INVESTOR DISCUSSION PACK RISK MANAGEMENT
Slide 73: Long Run Provisions & Loss Rates
ANZ 2023 Half Year Debt Investor Presentation LONG RUN PROVISIONS & LOSS RATES Total credit impairment charge, $m 2,000 1,500 1,000 500 0 -500 -1,000 1H08 2H08 1H09 2H09 1H10 2H10 1H11 2H11 1H12 2H12 1H13 2H13 1H14 2H14 1H15 2H15 1H16 2H16 1H17 2H17 1H18 2H18 1H19 2H19 1H20 2H20 1H21 2H21 1H22 2H22
Slide 74: Portfolio Rebalancing Supports Lower Future Loss Profile
ANZ 2023 Half Year Debt Investor Presentation PORTFOLIO REBALANCING SUPPORTS LOWER FUTURE LOSS PROFILE Exposure at Default2 (% portfolio) • Sold or exited >30 businesses Asset class & historical IP1 Lower Sep 16 Mar 23 • Growth in “low loss” portfolios while decreasing loss rates exposure to “higher
Slide 75: Individual Provision (IP) Charge
ANZ 2023 Half Year Debt Investor Presentation INDIVIDUAL PROVISION (IP) CHARGE IP charge, $m IP charge by division1, $m 626 626 1 398 395 380 272 380 398 395 807 187 7 0 3 6 592 35 40 49 500 69 35 532 87 62 375 -8 -30 155 170 266 162 187 247 123 168 201 3 158 175 55 93 93 80 103 54 51 87 36 59 69 -8
Slide 76: Collective Provision (CP) Balance & Charge
ANZ 2023 Half Year Debt Investor Presentation COLLECTIVE PROVISION (CP) BALANCE & CHARGE CP charge, $m CP balance, $m 1.39% 1.25% 1.22% 1.17% 1.17% 1H19 2H19 1H20 2H20 1H21 2H21 1H22 2H22 1H23 1.08% 1.07% 0.98% 0.94% 5,008 CP charge 13 4 1,048 669 -678 -145 -371 60 163 4,501 696 11 4,285 4,195 4,040
Slide 77: Collective Provision (CP) Balance
ANZ 2023 Half Year Debt Investor Presentation COLLECTIVE PROVISION (CP) BALANCE CP balance by division, $b Provision balance by stage, $b Mar 19 Sep 19 Mar 20 Sep 20 Mar 21 Sep 21 Mar 22 Sep 22 Mar 23 31 March 2022 31 March 2023 Aus. Retail 0.93 0.91 1.18 1.42 1.11 1.07 0.91 0.90 0.95 Aus. Commercia
Slide 78: Portfolio Composition and Coverage Ratios
ANZ 2023 Half Year Debt Investor Presentation PORTFOLIO COMPOSITION AND COVERAGE RATIOS Gross Loans & Advances Credit RWA Exposure at Default1 Exposure at Default1 Expected Credit Loss (ex Sovereign & Bank) (Collective Provision Balance) $1,193b $4.04b 3% 1% 7% $857b 2% 21% $694b 36% 4% 3% 2% 20% 51
Slide 79: Expected Credit Loss – Economic Scenarios: Modelled Outcomes
ANZ 2023 Half Year Debt Investor Presentation EXPECTED CREDIT LOSS – ECONOMIC SCENARIOS: MODELLED OUTCOMES (COLLECTIVE PROVISION BALANCE SCENARIOS)¹ Mar 23, $m Economic scenarios Actual Base case 2 31 March 2023 CY2021A CY2022A CY2023F CY2024F Australia GDP change3 4.5% 3.6% 2.0% 1.2% Weightings to
Slide 80: Impaired Assets
ANZ 2023 Half Year Debt Investor Presentation IMPAIRED ASSETS Control list, Index Sep 16=100 New impaired assets by division, $m 150 2,000 1,570 100 1,500 1,121 1,000 890 639 599 538 50 500 0 0 Mar Sep Mar Sep Mar Sep Mar Sep Mar Mar 19 Mar 20 Mar 21 Mar 22 Sep 22 Mar 23 19 19 20 20 21 21 22 22 23 A
Slide 81: Risk Weighted Assets (RWA)
ANZ 2023 Half Year Debt Investor Presentation RISK WEIGHTED ASSETS (RWA) Total RWAs, $b Credit RWA drivers, $b 449 455 1.3 438 436 10.0 48 48 4 408 48 396 42 15 47 38 47 2.7 41 44 13 19 359.4 178 144 142 153 163 150 0.5 345.3 -28.5 -0.1 8 8 7 7 7 8 53 62 57 59 56 58 47 46 43 39 40 36 94 91 92 91 93
Slide 82: Risk Weighted Assets & Exposure at Default Composition
ANZ 2023 Half Year Debt Investor Presentation RISK WEIGHTED ASSETS & EXPOSURE AT DEFAULT COMPOSITION1 EAD composition, $b EAD & CRWA movement, HoH FX adjusted $b 1,193 18.3 1,152 16 1,103 8 40 38 14.7 1,075 47 1,045 7 42 49 10 9.2 968 51 10 47 48 45 13 44 251 4.4 56 3.6 43 333 0.9 0.7 1.1 1.0 305 0.
Slide 83: Total Portfolio Composition
ANZ 2023 Half Year Debt Investor Presentation TOTAL PORTFOLIO COMPOSITION Exposure at Default (EAD) distribution % of Impaired Assets Gross Impaired Category % of Group EAD1 to EAD1 Assets2 Mar 22 Sep 22 Mar 23 Mar 22 Sep 22 Mar 23 Mar 23 5.5% Consumer Lending 39.3% 37.8% 38.3% 0.1% 0.1% 0.1% $449m
Slide 84: Commercial Property – Segments of Interest
ANZ 2023 Half Year Debt Investor Presentation COMMERCIAL PROPERTY – SEGMENTS OF INTEREST Outstandings by region, GLA $b Outstandings by sector, % 6% 9% 7% 6% 7% 7% 3% 2% 2% 2% 2% 2% 7.6% 7.6% 7.3% 7.3% 19% 6.9% 7.0% 18% 18% 18% 21% 20% 52.8 50.9 2.2 47.7 2.3 46.5 45.2 2.1 28% 29% 29% 2.4 11.2 30% 42
Slide 85: Commercial Property – Segments of Interest
ANZ 2023 Half Year Debt Investor Presentation COMMERCIAL PROPERTY – SEGMENTS OF INTEREST Commercial property collateral1,2, % Portfolio growth, Mar 23 v Mar 22 79% of portfolio well secured • Predominantly Australian region across a diversified portfolio of lending segments 45% Portfolio quality, Ma
Slide 86: ANZ Institutional Portfolio
ANZ 2023 Half Year Debt Investor Presentation ANZ INSTITUTIONAL PORTFOLIO Size & tenor by market of incorporation, $b Industry composition Finance EAD Mar 231 Government Administration & Defence 16% 541 Property & Business Services 3% 31% Services To Finance & Insurance 3% A$541b¹ 4% Manufacturing (
Slide 87: ANZ Asian Institutional Portfolio
ANZ 2023 Half Year Debt Investor Presentation ANZ ASIAN INSTITUTIONAL PORTFOLIO Market of incorporation ANZ Asia industry composition Finance 3% 6% 4% Manufacturing 19% 3% 10% 2% 3% Wholesale Trade China South Korea 3% 3% 6% A$127b¹ 7% Services to Finance & Insurance Japan India A$127b¹ Property & B
Slide 88: Investor Discussion Pack – Housing Portfolio
2023 HALF YEAR RESULTS INVESTOR DISCUSSION PACK HOUSING PORTFOLIO
Slide 89: Australia Home Loans – Portfolio Overview
ANZ 2023 Half Year Debt Investor Presentation AUSTRALIA HOME LOANS – PORTFOLIO OVERVIEW Portfolio1 Flow2 Portfolio1 1H21 1H22 1H23 1H22 1H23 1H21 1H22 1H23 Number of Home Loan accounts 1,019k 984k 969k 82k3 95k3 Average LVR at Origination9,10 71% 70% 65% Total FUM $281b $278b $293b $35b $43b Average
Slide 90: Australia Home Loans – Portfolio Composition
ANZ 2023 Half Year Debt Investor Presentation AUSTRALIA HOME LOANS – PORTFOLIO COMPOSITION Home Loan flows (Gross Loans & Advances1), $b Loan balance & lending flows1, $b 10 11 5 18 6 50 12 10 7 0 293 7 8 278 7 7 -65 3 9 13 6 8 7 8 1 25 26 27 23 23 Mar 22 New Sales Net OFI Refi. Redraw & Repay / Oth
Slide 91: Australia Home Loans – Portfolio Composition & Flow
ANZ 2023 Half Year Debt Investor Presentation AUSTRALIA HOME LOANS – PORTFOLIO COMPOSITION & FLOW By Purpose, % of total balances By Origination LVR4,5, % of total balances Portfolio 1,2 Flow3 Flow3 2% 2% 1% 0% 11% 31% 22% 19% 30% 30% 33% 17% 21% 21% 68% 68% 68% 67% 60% 72% 57% Mar 21 Mar 22 Mar 23
Slide 92: Australia Home Loans – Portfolio Resilience
ANZ 2023 Half Year Debt Investor Presentation AUSTRALIA HOME LOANS – PORTFOLIO RESILIENCE Home Loans repayment profile1,2 Home Loans on time and <1 month ahead profile2,3 % of accounts ahead of repayments % composition of accounts 40 Investment: Interest payments may 30 receive negative gearing/tax
Slide 93: Australia Home Loans – Portfolio Resilience
ANZ 2023 Half Year Debt Investor Presentation AUSTRALIA HOME LOANS – PORTFOLIO RESILIENCE Fixed rate Home Loan expiry profile, $b ANZ flow borrowing capacity1, 1H23 27 24 9% 2% 20 18 Surplus Capacity Minimal Capacity 14 At Capacity 11 9 89% 30+ DPD at Mar 23 by fixed rate expiry month 1H22 2H22 1H23
Slide 94: Australia Home Loans – Book Originated and Attributes
ANZ 2023 Half Year Debt Investor Presentation AUSTRALIA HOME LOANS – BOOK ORIGINATED AND ATTRIBUTES ANZ has limited exposure Home Loans portfolio, Mar 23 to recently originated lending at high LVRs with no LMI, and much of this Time on Book ($b) cohort has savings buffers in excess of 3 months of 29
Slide 95: Australia Home Loans – Outcome of Rate Rises
ANZ 2023 Half Year Debt Investor Presentation AUSTRALIA HOME LOANS – OUTCOME OF RATE RISES ANZ interest rate buffer & floor ANZ Home Loan Portfolio, Mar 23 Home loan applications are assessed at the greater of the customer interest rate plus the interest rate buffer or an interest rate floor Total P
Slide 96: Australia Home Loans – Portfolio Performance
ANZ 2023 Half Year Debt Investor Presentation AUSTRALIA HOME LOANS – PORTFOLIO PERFORMANCE Home Loans 90+ DPD (by State)1,2 Home Loans delinquencies1,2,3,4 % of Portfolio Segment Balances % of Portfolio Segment Balances 2.5 2.5 2.0 1.5 1.0 2.0 0.5 0.0 Mar Sep Mar Sep Mar Sep Mar Sep Mar Sep Mar 18 1
Slide 97: New Zealand Home Loans – Portfolio Overview
ANZ 2023 Half Year Debt Investor Presentation NEW ZEALAND HOME LOANS – PORTFOLIO OVERVIEW Portfolio Flow Portfolio 1H21 1H22 1H23 1H22 1H23 1H21 1H22 1H23 Number of Home Loan Accounts 533k 540k 538k 31k 23k Average LVR at Origination 58% 56% 54% Total FUM NZD95b NZD103b NZD105b NZD14b NZD8b Average
Slide 98: New Zealand Loans – Home Lending & Arrears Trends
ANZ 2023 Half Year Debt Investor Presentation NEW ZEALAND LOANS – HOME LENDING & ARREARS TRENDS Home Loan LVR profile1 Housing flows Housing portfolio 1% 1% 2% 2% 5% 11% 11% 11% 7% 7% 45% 7% 55% 57% 15% 12% 11% 89% 89% 89% 55% 45% 43% 15% 1H21 1H22 1H23 Mar 21 Mar 22 Mar 23 Proprietary Broker Fixed
Slide 99: Investor Discussion Pack – Economics
2023 HALF YEAR RESULTS INVESTOR DISCUSSION PACK ECONOMICS
Slide 100: Australia & New Zealand Economic Forecasts
ANZ 2023 Half Year Debt Investor Presentation AUSTRALIA & NEW ZEALAND ECONOMIC FORECASTS 2018 2019 2020 2021 2022 2023F1 2024F1 Australia – annual % growth GDP 1.9 -1.8 5.2 3.7 2.1 1.5 1.9 Australia - headline CPI (% y/y) 1.9 1.6 0.8 2.9 6.6 5.8 3.6 Australia – employment (% y/y) 2.3 2.2 -1.0 2.2 4.
Slide 101: Australian Economy – Economic Growth
ANZ 2023 Half Year Debt Investor Presentation AUSTRALIAN ECONOMY – ECONOMIC GROWTH GDP growth1 Nominal Australian retail sales2 and Consumer Confidence3 30 % change 140 20 130 120 10 110 Total Retail, m/m (LHS) 0 100 Total Retail, y/y (LHS) Consumer Confidence (RHS) 90 -10 80 -20 70 Jan 19 Jan 20 Ja
Slide 102: Australian Economy – Income and Savings
ANZ 2023 Half Year Debt Investor Presentation AUSTRALIAN ECONOMY - INCOME AND SAVINGS Household disposable income growth1 Stock of excess savings2 Real, year-ended with contributions Share of 2022 household disposable income Statement of Mon policy- Aug 22 Household income and consumption3 Household
Slide 103: Australian Economy – Inflation
ANZ 2023 Half Year Debt Investor Presentation AUSTRALIAN ECONOMY - INFLATION Consumer price index1 CPI inflation2 Year-ended, with contributions TBU RBA Chart Pack Wages growth2 Global inflation comparisons3 Six-month annualised % Change y/y Statement of Mon policy- Aug 22 Source: ABS, BLS, Eurostat
Slide 104: Australian Labour Market
ANZ 2023 Half Year Debt Investor Presentation AUSTRALIAN LABOUR MARKET Unemployment and underemployment1 Job vacancies and advertisements1 % of labour force % of labour force Real labour income2 Employment and hours worked* , 1 Deflated using headline CPI, December 19 = 100 2008 average=100 103 Sour
Slide 105: Commodities
ANZ 2023 Half Year Debt Investor Presentation COMMODITIES RBA index of commodity prices1 Resource exports1 SDR, 2021/22 average = 100, log scale Log scale, quarterly Bulk commodity prices1 Terms of trade*, 1 Free on board basis 2020/21 average = 100, log scale 104 Sources: 1. RBA Chart Pack, May 202
Slide 106: Australian Housing Dynamics
ANZ 2023 Half Year Debt Investor Presentation AUSTRALIAN HOUSING DYNAMICS Housing price forecasts by capital city1 House price growth2 5 Year Cumulative 6 Month Change Year on Year Change Fall from peak Apr-23 Change Total Houses Units Total Houses Units Total Houses Units Total Houses Units Sydney
Slide 107: Australian Housing Dynamics
ANZ 2023 Half Year Debt Investor Presentation AUSTRALIAN HOUSING DYNAMICS Private residential building approvals1 New housing lending 2 Monthly % monthly housing finance, ex re-financing First Home Owners’ Boost NSW & Victoria reduce stamp duty Number of new listings per month3 Housing mortgage paym
Slide 108: Australian Housing Dynamics – Household Resilience
ANZ 2023 Half Year Debt Investor Presentation AUSTRALIAN HOUSING DYNAMICS – HOUSEHOLD RESILIENCE Household mortgage prepayments1 Liquid assets of mortgage holders1 Share of loans, by months of prepayments, December 2022 Share of owner-occupier borrowers, six months to November 2022 Outstanding LVR d
Slide 109: Australian Housing – Rental Markets
ANZ 2023 Half Year Debt Investor Presentation AUSTRALIAN HOUSING – RENTAL MARKETS Rental vacancy rates1 Rent inflation1 Seasonally adjusted, quarterly Stat of Mon Policy- Aug 22 Average household size1 Net overseas arrivals2 108 Sources: 1. RBA Statement of Monetary Policy, May 2023 2. ABS, Macrobon
Slide 110: Key Contacts
ANZ 2023 Half Year Debt Investor Presentation KEY CONTACTS ANZ Debt Investors Centre Key Contacts Adrian Went David Goode Steven Aquilina Group Treasurer Head of Debt Investor Relations Associate Director, Debt Investor Relations +61 3 8654 5532 +61 3 8654 7778 +61 412 027 151 +61 410 495 399 +61 44
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