Anz Group Holdings Limited · ASX:ANZ
Anz — Australia and New Zealand Banking Group — Debt Investor Presentation (February 2022)
33 slides from Anz's debt investor presentation, Feb 15, 2022
Slide 1: News Release: ANZ Capital Notes 7 Investor Presentation
News Release For Release: 15 February 2022 For personal use only ANZ Capital Notes 7 Investor Presentation Attached is an investor presentation released today by ANZ relating to its offer of ANZ Capital Notes 7. The information in the presentation is prepared for Wholesale Investors only. Investors
Slide 2: ANZ Capital Notes 7
For personal use only ANZ CAPITAL NOTES 7 15 FEBRUARY 2022 AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED (ABN 11 005 357 522)
Slide 3: Disclaimer
DISCLAIMER This presentation has been prepared by Australia and New Zealand Banking Group Limited (ABN 11 005 357 522) ("ANZ") in connection with the offer (“Offer”) of ANZ Capital Notes 7 (“ANZ For personal use only Capital Notes 7” or “Notes"). The Offer is being made under a prospectus (“Prospect
Slide 4: Contents
CONTENTS For personal use only OFFER SUMMARY 3 FY21 RESULTS UPDATE AND Q1 22 UPDATE 8 APPENDIX 1- KEY TERMS 21 APPENDIX 2 – KEY DATES AND CONTACTS 28 2
Slide 5: ANZ Capital Notes 7: Key Terms
ANZ CAPITAL NOTES 7: KEY TERMS ● Offer of ANZ Capital Notes 7 (“Notes”) by Australia and New Zealand Banking Group Limited (“ANZ”) For personal use only Offer ● Includes a Reinvestment Offer under which Eligible CN2 Holders can apply to reinvest some or all of their CN2 in Notes Offer size ● $1 bill
Slide 6: Summary of Optional Exchange Dates
SUMMARY OF OPTIONAL EXCHANGE DATES For personal use only The diagram below summarises certain events that may occur while the ANZ Capital Notes 7 are on issue, and what Holders may receive if those events occur. The events depend on a number of factors including ANZ’s share price, the occurrence of
Slide 7: Comparison to Other ANZ Capital Notes
COMPARISON TO OTHER ANZ CAPITAL NOTES REINVESTMENT OF CN2 INTO NOTES IS NOT A SIMPLE ROLLOVER INTO A SIMILAR INVESTMENT. THE NOTES AND CN2 HAVE DIFFERENT RIGHTS, BENEFITS AND RISKS WHICH MUST BE EVALUATED SEPARATELY For personal use only ANZ Capital Notes 7 ANZ Capital Notes 6 ANZ Capital Notes 2 AS
Slide 8: Options for Eligible CN2 Holders
OPTIONS FOR ELIGIBLE CN2 HOLDERS1 ANZ HAS ISSUED A REDEMPTION NOTICE FOR CN2 Required Eligible CN2 Holder Option Description For personal use only action Reinvestment 1 • Apply to participate in the • Apply through a syndicate broker Reinvest CN2 Reinvestment Offer and reinvest • Applications can on
Slide 9: Offer Structure and Notes Target Market
OFFER STRUCTURE AND NOTES TARGET MARKET All Applications for Notes must be from: • an Institutional Investor; or For personal use only • a client of a Syndicate Broker who is either: Applications • a Wholesale Investor; or • a retail investor within the Notes Target Market who has received personal
Slide 10: FY21 Results Update and Q1 Update
For personal use only FY21 RESULTS UPDATE AND Q1 22 UPDATE
Slide 11: Overview: First Quarter FY2022
OVERVIEW FIRST QUARTER FY2022 (PERIOD ENDED 31 DECEMBER 2021) For personal use only Net Interest Margin • Group Net Interest Margin was down 8bps for the quarter with underlying NIM down 5bps, largely driven by a lower exit rate at the full year (versus the second half average) and a continuation of
Slide 12: Full Year 2021 Financial Snapshot
FULL YEAR 2021 FINANCIAL SNAPSHOT For personal use only FY21 change 2 year change FY21 (FY21 vs FY20) (FY21 vs FY19)3 Statutory Profit ($m) 6,162 +72% +4% Cash Profit (continuing operations)1 ($m) 6,198 +65% -4% Return on Equity (%) 9.9 +376bps -95bps Earnings Per Share (cents) 218.3 +65% -4% Cash P
Slide 13: Financial Performance: Continuing Operations
FINANCIAL PERFORMANCE CONTINUING OPERATIONS For personal use only FY21 CASH PROFIT DRIVERS LARGE / NOTABLE ITEMS $m FY201 FY21 $m Total (after tax) -1,501 -946 Divestments incl. Gain/(Loss) on sale 23 -238 3,282 Customer remediation -279 -221 6,198 Litigation settlements - -48 193 -839 555 Restructu
Slide 14: Net Interest Margin
NET INTEREST MARGIN CONTINUING OPERATIONS For personal use only GROUP NET INTEREST MARGIN (NIM) bps 1 165 3 163 4 161 -1 -3 0 -2 Deposit / funding mix +1 Replicating portfolio volume +1 Home Loan SVR to Fixed -2 -2bps +2bps 1H21 Impact of rates Liquidity Asset pricing Asset & Wholesale 2H21 Markets
Slide 15: Balance Sheet Structure
BALANCE SHEET STRUCTURE1 For personal use only Pro forma NSFR is ~119% once NSFR MOVEMENT RSF benefit associated with TFF BALANCE SHEET COMPOSITION Sep-21 and CLF 10 is removed Sep-21 % 5.5 0.6 123.8 -2.2 0.8 1.0 123.8 -1.9 Short Term Wholesale Debt & -3.8 Other Funding2 Liquid and Other Assets 23%
Slide 16: Liquidity Coverage Ratio (LCR) Summary
LIQUIDITY COVERAGE RATIO (LCR) SUMMARY1 For personal use only MOVEMENT IN AVERAGE LCR SURPLUS3 LCR COMPOSITION (AVERAGE) $b FY21 $b 226 FY20 FY21 Internal RMBS Avg LCR 139% Avg LCR 137% Other ALA2 34 HQLA2 -3 61 60 -5 -2 -1 165 Wholesale funding -22 HQLA1 Customer deposits & other3 FY20 CLF4 Liquid
Slide 17: Regulatory Capital – FY21
REGULATORY CAPITAL – FY21 For personal use only CAPITAL UPDATE APRA LEVEL 2 COMMON EQUITY TIER 1 RATIO (CET1) ● Level 2 CET1 ratio of 12.3% and 18.3% on an Internationally Comparable % basis1, which is well in excess of ‘Unquestionably Strong’ benchmark2 o Total credit impacts of +14bps primarily fr
Slide 18: Regulatory Capital
REGULATORY CAPITAL Including September 2021 ratios and December 2021 ratios with pro forma adjustments For personal use only ANZ’S SUMMARISED CONSOLIDATED CAPITAL ADEQUACY RATIOS AS AT 31 DECEMBER 2021 Proforma ANZ Proforma ANZ Proforma ANZ Proforma Proforma ANZ 30 ANZ 31 31 December 31 December Pro
Slide 19: AT1 Distributions and Conversion Trigger Protection
AT1 DISTRIBUTIONS AND CONVERSION TRIGGER PROTECTION ANZ’S CET1 CAPITAL POSITION AND STRONG EARNINGS PROVIDE BUFFERS FOR AT1 INVESTORS For personal use only Increases to Basel 3 CET1 Capital & Indicative buffers as at Actions available to strengthen capital ~10%-10.25% Capital Conservation Buffers1 3
Slide 20: AT1 Distribution Protections
AT1 DISTRIBUTION PROTECTIONS ANZ’S CET1 CAPITAL POSITION AND STRONG EARNINGS PROVIDE BUFFERS FOR AT1 INVESTORS For personal use only • AT1 distributions may be progressively restricted if ANZ allows the CET1 ratio to drop below LEVEL 1 SURPLUS CET1 APRA’s minimum capital requirement plus prescribed
Slide 21: Consistent Approach to AT1 Issuance: Size and Maturities
CONSISTENT APPROACH TO AT1 ISSUANCE: SIZE AND MATURITIES For personal use only • ANZ’s near term AT1 requirements primarily driven by its scheduled maturity profile • AT1 currently on issue exceeds requirements • Modest RWA growth since last issue in 2021 (1H21 RWA of $408bn versus FY21 of $416bn) •
Slide 22: Past Performance of ANZ Securities
PAST PERFORMANCE OF ANZ SECURITIES AVERAGE TRADING PRICES OF SELECTED ANZ CAPITAL SECURITIES COMPARED TO AN ADJUSTED ANZ ORDINARY SHARE PRICE For personal use only Trading Price ($) 140 130 120 110 100 90 80 70 60 50 40 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Slide 23: Appendix 1: Key Terms
For personal use only APPENDIX 1: KEY TERMS
Slide 24: Key Terms: Offer Summary
KEY TERMS: OFFER SUMMARY ● Offer of ANZ Capital Notes 7 (“Notes”) by Australia and New Zealand Banking Group Limited (“ANZ”) – Mandatorily For personal use only Offer Convertible into Ordinary Shares ● Includes a Reinvestment Offer under which Eligible CN2 Holders can apply to reinvest some or all o
Slide 25: Key Terms: Distributions
KEY TERMS: DISTRIBUTIONS ● Non-cumulative based on a floating rate (3-Month BBSW) For personal use only ● Expected to be franked to the same level as Ordinary Shares1 ● If a Distribution is not fully franked, the cash amount of the Distribution will be increased to compensate holders for the unfrank
Slide 26: Key Terms: Mandatory Conversion Date
KEY TERMS: MANDATORY CONVERSION DATE ● On 20 September 2031 (“Mandatory Conversion Date”), subject to satisfaction of the Mandatory Conversion Conditions, For personal use only the Notes will mandatorily Convert into a variable number of ANZ Ordinary Shares at a 1% discount to the 20 day VWAP1, unle
Slide 27: Key Terms: Mandatory Conversion Trigger Event
KEY TERMS: MANDATORY CONVERSION TRIGGER EVENT For personal use only Trigger Event ● Means a Common Equity Capital Trigger Event or Non-Viability Trigger Event Common Equity Capital ● ANZ determines, or APRA has notified ANZ in writing that it believes, that ANZ’s Common Equity Capital Ratio is equal
Slide 28: Key Terms: Early Redemption, Conversion and Resale Rights
KEY TERMS: EARLY REDEMPTION, CONVERSION AND RESALE RIGHTS ANZ Early Redemption ● ANZ may choose to Exchange all or some Notes on issue on 20 March 2029, 20 June 2029 or For personal use only Option 20 September 2029 Regulatory or Tax Event ● ANZ may choose to Exchange all or some Notes if a Regulato
Slide 29: Key Terms: What Happens Post a Trigger Event
KEY TERMS: WHAT HAPPENS POST A TRIGGER EVENT For personal use only 1 A Common Equity Capital or Non-Viability Trigger Event occurs 2 Ordinary Shares can be issued? No Written off up to required amount of CET11 Yes 2a Notes Convert to Ordinary Shares up to required amount of CET11: Outstanding princi
Slide 30: Appendix 2: Key Dates and Contacts
For personal use only APPENDIX 2: KEY DATES AND CONTACTS
Slide 31: Key Dates: CN7 Offer
KEY DATES: CN7 OFFER1 For personal use only Record Date for determining Eligible CN2 Holders for the Reinvestment Offer 7:00pm on 10 February 2022 (relevant CN2 must also be held on the Closing Date for the Reinvestment Offer) Lodgement of the Prospectus with ASIC 15 February 2022 Bookbuild to deter
Slide 32: Key Dates: CN2 Holders
KEY DATES: CN2 HOLDERS1 For personal use only Record date for determining Eligible CN2 Holders for the Reinvestment Offer (relevant 7.00pm on 10 February 2022 CN2 must also be held on the Closing Date for the Reinvestment Offer) Redemption notice given in respect of CN2 15 February 2022 Last day of
Slide 33: Key Contacts
KEY CONTACTS ANZ Group Treasury For personal use only Group Treasurer Adrian Went +61 3 8654 5532 Adrian.Went@anz.com Head of Capital & Structured Funding John Needham +61 2 8037 0670 John.Needham@anz.com Head of Debt Investor Relations Scott Gifford +61 3 8655 5683 Scott.Gifford@anz.com Senior Mana
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