Media Briefing Financial Results – 30 June 2011

1. Media BriefingFinancial Results – 30 June 2011

2. Topics Covered • Key Milestones • Financial Performance • Credit Quality • The Future

3. Key milestones • Profit after tax of $21.2m for the year ended 30 June 2011, a 54% decrease on previous year’s profit of $45.8m • Net interest income has increased by 43% to $191.3m • Strong focus maintained on customer funding with deposits now accounting for 80% of all bank funding. • Improvement in cost income ratio from 73% to 68% • Continued growth in balance sheet since prior year: • Lending increased 10% by $1.08bn to $11.5bn • 14% increase in retail deposits from $6.9bn to $7.9bn • Net interest margin increased from 118bps to 147bps

4. Key achievements continued • Launched 32 and 90 day Notice Saver accounts which provided strong customer returns • Personal banking market continues to grow with customer numbers exceeding 750,000 • Kiwibank became a Qualifying Financial Entity (QFE) during the year • “Best Value Bank” five years in a row (Canstar and Sunday Star Times) • Coveted Bank of the Year award by London-based The Banker magazine • Awarded New Zealand’s most trusted bank brand, four years in a row, by Reader’s Digest

5. Key achievements continued Appeals launched for both Christchurch earthquake and Australian floods with $2m donated Inaugural Kiwibank chairman (Rt Hon. Jim Bolger) replaced by Ian Fitzgerald and subsequently Rob Morrison.

6. Financial Performance - Historical summary Net interest income increased due to customer preference for floating mortgages and raising of cheaper ECP funding * June 09 excludes $11m for sale of group subsidiaries to 100% NZ Post subsidiary, Kiwi Group Holdings Ltd

7. Financial Performance - Balance sheet • Lending growth continues despite slowdown in the housing market • Strong depositor support continues to maintain retail funding ratio • Wholesale assets maintained at high levels to reflect liquidity requirements of uncertain environment throughout the year

8. Financial Performance (key ratios)

9. Financial Performance – Capital Adequacy • Total Capital ratio under Basel II is 11.0% compared to RBNZ’s minimum regulatory capital ratio of 8% • Total capital increased by $15m to $737m, a 2% increase from June 10.

10. Credit Quality (Impaired Assets) • The table shows our total impaired assets as a % of total assets from latest available Key Information Summaries. Kiwibank remains favourably placed against other banks • The ratio has increased slightly across strong balance sheet growth as a result of the Christchurch earthquake and the remaining effects of the global financial crisis (GFC) • Impaired Assets of $106m include all assets where interest charges have been suspended and a specific provision has been raised Source: June 11 DS for Kiwibank and latest published Disclosure Statements for other banks

11. Credit Quality (Total Credit Provisions to Total Assets) • Ratio has increased due to impact of Christchurch earthquake and a more conservative approach to provisioning during the GFC • Each bank has a different product and risk portfolio to Kiwibank which has a high % secure mortgage book and LMI insurance for assets over 80% Source: Most recently published Disclosure Statements

12. The future • Consider any investment opportunities in the market as they arise • Expand into new segments of business markets • Retail transformation project aimed at improving customer experience • Growing insurance and wealth business • Strong focus on helping customers switch to Kiwibank and driving change to make switching between banks easier • Growing asset finance business through Kiwi Asset Finance Limited