Corporate & Institutional Banking

1. Corporate & Institutional Banking Dr Bob Edgar Managing Director Australia and New Zealand Banking Group Limited 20 July 2001

2. The relationship gateway to our corporate customer base • Financial performance • Strong customer focus • Conservative risk management • Growth focused on fee-based investment banking style products • Goals for Corporate & Institutional Banking

3. Corporate & Institutional Banking Institutional Banking Corporate Banking • Top end corporates in with $100m plus turnover • Has ~1000 customers & targets, in Australia and New Zealand • 9 Specialised Industry Segments • Supported by Credit Products Group • Middle market companies with $10 - $100m turnover • 5500 customers & targets • Geographic relationship management model with 21 regions across Australia & New Zealand • Regional Credit Executives located with relationship Key Responsibilities • Management of overall customer relationship & profitability • Balance sheet management • Navigation, co-ordination & solutions development between product areas for our customers

4. Institutional Banking continues to perform strongly Operating Income Profit After Tax $m $m 31% Growth 22% Growth Mar-01 Sep-00 Mar-00 Mar-01 Sep-00 Mar-00 % Cost Income FTE 50 500 475 40 435 450 430 30 23.9 422 22.2 21.1 425 20 400 10 375 0 350 Mar-01 Sep-00 Mar-00 Sep-00 Mar-00 Mar-01

5. Corporate Banking performance has been more subdued $m Operating Income Profit After Tax $m 200 195 188 190 187 183 3% Growth 185 7% Growth 180 175 170 165 160 Mar-00 Sep-00 Mar-01 Mar-00 Sep-00 Mar-01 % FTE Cost Income Mar-00 Sep-00 Mar-01 Mar-00 Sep-00 Mar-01

6. CIB relationship management is the gateway to our corporate customers Source of Customer Revenue & NIACC CIB Australia & NZ • The value of the CIB customer franchise is much larger than the reported ‘balance sheet’ driven numbers • Over 40% of revenue from CIB customer base is booked in other business units • Over 60% of NIACC (Net Income After Capital Charge*) is booked in other business units • Taking a complete customer view ensures cross-selling opportunities are optimised Revenue NIACC * NIACC is an EVA based profitability measure used within ANZ at the customer level

7. NIACC $460m CTI 28% ELP 37bp • Corporate • Banking portal • CARBe • Impact NIACC $130m CTI 36% ELP 53bp • Industry • specialisation • in IB • e-Transformation • Outsourcing / • centralisation • - CTSC • - Securities • Customer Profitability tool • Product • specialists in • regions • Distribution • Strategy • Role clarity • Process improvement 1998 1999 2000 2001 CIB drives for continuous change to be a high performing customer business

8. ANZ NAB CBA WBC We are a leader in customer relationship management Satisfaction with Relationship Manager (Corporate Bank) Market Position (Institutional Bank) 8.4 8.5 8.3 8.1 8.1 8.1 8.0 Total customers 8 7.5 7.5 Significant Bank R’ships 7.4 7.4 7.4 7 7.0 6.8 Lead bank customers 6.5 6 1995 1996 1997 1998 1999 2000 Overall Satisfaction with Bank (Corporate Bank) Relationship Management (Institutional Bank) 8.0 7.6 Overall satisfaction 7.6 7.4 7.5 7.5 Quality of account management 7.0 7.1 Level of ideas & initiatives 7.0 6.9 Understanding and knowledge of business 6.5 6.4 Prompt follow-up 6.0 1997 1998 1999 2000 Source: Roberts Research Group Source: Greenwich Associates

9. Risk grades 7D-10 [ie B to D external credit ratings agency equivalents] are less than 4% of total book This reflects a substantial improvement in book quality Risk grades 5-7C [ie BB+ to well secured B] improved from 54.3% to 43% of book. Risk Profile 35 30 25 20 Assets (%) 15 10 5 0 1 2 3 4 5 6 7 8 9 10 CCR Risk profile and management stance remain conservative

10. For key asset quality indicators, CIB has a solid record - no systemic credit issues ELP is a key measure of portfolio quality • Risks actively managed • Enhanced credit management processes reducing expected loss rates in the business, (eg ‘one-up’ reviews) • Whilst net specific provisions have increased during the first half year, the loss rate is still well below ELP rate • At this stage of the credit cycle, we expect specific provisions to increase towards ELP ELP Rate % of Lending Assets SP Rate

11. Institutional Corporate Index Index Inv. Bank products Wall St to Main St Other Other Traditional Income Traditional Income Mar-00 Mar-01 Mar-00 Mar-01 Growth is increasingly being driven by investment banking style products… Traditional Income –lending, transaction, deposit & trade products Other - principally products from the Personal portfolio

12. What do our customers want? - their top 3 needs are CB to focus on: • Wall St to Main St • Cross sell products from the Personal businesses into our customer base: • Corporate portal to lower cost to serve Corporate Banking Institutional Banking • ‘Balance Sheet’ on reasonable terms • Partner & trusted advisor • Smart products / customised solutions • Industry Knowledge • Creative ideas and solutions • High quality service proposition • IB’s focus will be: • Leverage the success of Industry Specialisation to our institutional customers • Client servicing • Corporate Portal – helps customers streamline operations

13. Transaction details Customer profitability Product & pricing details Management Analysis Reporting System Product profitability Risk profile “What if” scenarios Relationship expense Risk based pricing Share of overheads …supported by world class customer value management systems like MARS Key Inputs Key Outputs

14. Summary • The pre-eminent domestic corporate banking franchise • Our cross sell focus is embedded in the sales network, driven to growing non-balance sheet product solutions for customers • Optimising overall customer value is driving new revenue opportunities • The business will continue to build industry specialisation • Goals • Double digit earnings growth • Continue growth and diversification of customer revenue mix • Maintain customer satisfaction ratings • Performing loans remain at 99% of total book

15. Copy of presentation available on www.anz.com