Delivering for Shareholders Australia and New Zealand Banking Group Limited Peter Marriott Chief Financial Officer February 2000

Briefing Outline m Review of ANZ’s 1999 Results - Financial Perspective - Business Perspective m Outline Group Strategy with particular focus on Personal Financial Services strategy.

A Good Year for ANZ m EPS 90.6c up 17%. TSR up 19.6% m NPAT $1,480 million up underlying 18% m Return on Equity up to 17.2% (15.5%). ROA 1.0% (0.8%) m Costs down 4%. Cost income ratio down to 55.0% (60.9%) m Risks reduced. Gross non-accruals down 7%, net down 27% m $500 million share buyback m No abnormals. No Surprises.

Significant Improvement Achieved ROE % Cost Income Ratio % ROA % Gross and Net Non-Accruals $m 1, ,662 1,543

Good Progress Across the Board ,106 Abnorm al Items 69 1,175 Net Interest Income Growth 98 Lending Fee Growth 87 Other Fee Growth 93 Growth in Other Income 42 Lower Costs 83 Software Capitalisation 61 Higher Provisions (23) Increased Tax (136) 1,480 $m Post Abnormals 1998 Pre Abnormals

Drivers of Performance ROA ROE NII/Interest Earning Assets Net Interest Assets Other Income Assets Cost Assets Provisions Assets Leverage Risk Business Mix Cost/Income Provisions/NLA

Delivering on Cost Reduction Cost Income Ratios % ANZ WBC CBA NAB

FX Interest Reducing Risk US$b Asian Exposure Market Risk (VaR - Ave) A$m 23 AAA-BBB+ BBB BB BB- <B+ $65b $90b Australian Lending Asset Profile % Equities

Gross Non-Accrual Loans Non-Accrual Loans Net Non-Accrual Loans As at 30 September $m Gross Net Cover Australia % New Zealand % International % $m

Provisioning: ELP > SP at Group Level ELP - Economic Loss Provision SP - Specific Provision Sep 98Sep 99APRA Guideline ELP Charge Net SP Transfer $m FX Impact Surplus over APRA Guideline

Capital Strategy m Active capital management m Maintain AA status and peer ratings ã Tier 1 ( %) ã Inner Tier 1 (6.0% - 6.5%) m $500 million on-market buyback m Major international acquisitions unlikely m NZ Tracking Stock Issue in May Capital Adequacy Ratio % Inner Tier Hybrid

Economic Value Added (EVA) Net Income5,966 Operating Expenses(3,294) ELP Charge(510) Tax(676) Franking & Other Adjustments 352 Adjust Profit1,838 Cost of 11% (1,004) EVA834 * Hurdle of 15% used in internal models $ million

Business on Track m Strategic re-positioning on track in all segments m Good earnings growth in Australia and New Zealand m Business mix substantially improved. High risk businesses exited m Domestic market share up notwithstanding cost focus m 140,000 Internet banking customers (8000). ANZ E*Trade launched m Major technology projects completed on time, on budget

Business Mix Improved Business Segment Profit After Tax Other International Corporate Personal Up 33% Up 17% Down 20% Business Segment Proportion Personal Corporate International Other $m

Total Market Share Share of Credit Cards % ANZ NAB CBA WBC Share of Housing Lending % % Share of Business Lending % Nov-99 Gains in Australian Market Share

Overall Strategic Direction in Place m Balance business mix towards consumer and low risk ã Personal offers greatest growth and earnings potential ã Leading position in corporate to be leveraged ã International to be simplified and focused ã A leading presence in e-Commerce to be established m Transform management process to deliver EVA ã Withdraw from high-risk and non core segments ã Improve performance in suboptimal businesses ã Invest in high growth revenue streams ã Hold costs flat ã Optimise capital efficiency

Strategy for Personal m Aggressively build market position in all consumer segments m An intergrated financial services approach m Special focus on insurance and retail funds management m Differentiated service propositions by customer segment m Build strong product businesses m Continue intense focus on cost management m Build a leading consumer e-Commerce capability

Integrated Personal Financial Services Estimated Value of An Australian Retail Customer (A$ Present Value) Risk/Wealth Protection Traditional Banking $ Investment General Insurance & Traditional Life Banks/NFI Managed Funds Household Financial Assets $b

ANZ Has a High Quality Personal Customer Base Industry Ave ANZ Total Relationships (%) Wealth Bands Source: Roy Morgan 1998 Other $(000)

The Opportunity with Australian Consumers Source: Roy Morgan 98 All ANZ Customers High Value to ANZ High Value to Industry but limited ANZ business True Retail Market Customer Base 2.7m

A New Dedicated Business for Premier Customers m Premier Financial Package m Dedicated Managers m Premier Suites m Dedicated Service Officers

A fundamental shift to a customer-centric strategy Segmented Customer Service Propositions will now Drive Delivery High Value Customers Low Value Customers New Segmented approach Customer Revenue curve Traditional uniform cost to serve Segmented Customer Service Approach

Market share (% of Australian internet banking users) Customer takeup rate * (% of customer base) * Number of internet banking users (Ord Minnett 12/99) / number of main banking relationships (based on Ray Morgan 8/99 data) Source: Ord Minnett, Ray Morgan Leveraging Technology: anz.com

International - Simplify and Focus m Re-balance business mix towards consumer m Reduce cross border risk m Target Top 2-3 foreign or Top 5 local position m Leverage strong positions/ global capabilities m Deal with minor positions m Develop Asia-Pacific, e.g. Indonesia m Pursue acquisitions only where it creates a desired position - likelihood of our making a major international acquisition this year is low Continue to Reduce Risk Target Fewer, Deeper Positions Create Future Growth Platforms New Lending Policies Latin American Offices Closed 25% Interest in Panin, Cards acquisition

m Increase ROE towards 20% target m Target flat costs. Achieve 53% cost income ratio m Improve asset quality, particularly International m Progress towards target capital range m Set stretch performance targets and linked incentives m Target highest increase in e-Commerce customers m No surprises Continue to Deliver in 2000

m Positive view on world economy m Australian economy strong but slowing slightly m Business tracking close to our expectations, comfortable with “Street” expectations m Abnormal writedown of FITB of $60m from tax changes – will be partially offset by abnormal gainsOutlook

The material in this presentation is general background information about the Bank’s activities current at the date of the presentation. It is information given in summary form and does not purport to be complete. It is not intended to be relied upon as advice to investors or potential investors and does not take into account the investment objectives, financial situation or needs of any particular investor. These should be considered, with or without professional advice when deciding if an investment is appropriate. For further information visit or contact David Ward General Manager Office of the Chief Executive ph (613) fax (613)

Sep-99 Profit & Loss A$MSep-97Sep-98 Net Interest Income 3,4373,547 Fees1,459 1,574 FX Trading Securities182 Other Net Income5,5475,646 Expenses Personnel1,9491,854 Premises Computer Other Restructuring Costs90120 Total Expenses3,5023,438 Profit Before Provisions2,0452,208 Doubtful Debts Tax NPAT BeforeAbnormal Items1,1711,175 Abnormal Items NPAT andAbnormal Items1,0241,106 3,645 1, ,966 1, ,294 2, ,480 - Non Interest Income 2,1102,0992,321

Profit Before Provisions1,0241,0211,1641,0441,302 1,370 Mar-99 Profit & Loss A$MMar-97Sep-97Mar-98Sep-98 Net Interest Income 1,7181,7191,7731,7741,811 Fees FX Trading Securities Other Net Income2,7182,8292,9012,7452,945 Expenses Personnel Premises Computer Other Sub Total1,6941,7181,6971,6211,594 Restructuring Costs Total Expenses1,6941,8081,7371,7011,643 Doubtful Debts Tax NPAT BeforeAbnormal Items Abnormal Items - - NPAT andAbnormal Items Sep-99 1, , , , Non Interest Income1,0001,1101, ,134 1,187

Management Team m John McFarlaneCEOCitibank, Standard Chartered m David BoylesCIOAMEX, BOA m Roger DavisCorporateCitibank m Peter HawkinsPersonalANZ m Peter MarriottCFOANZ, KPMG m Greg CammMortgagesANZ m Larry CrawfordDistributionFirst Bank Systems, Wells Fargo m Bob EdgarBusiness BankANZ m Kathryn FaggBanking ProductsMcKinsey & Co m Brian HartzerCardsFirst Manhattan m Elmer Funke KupperInternationalMcKinsey & Co m Mark LawrenceRiskSoc Gen New York m Peter McMahonAsset FinanceANZ, Costain m Grahame MillerANZIBANZ m Elizabeth ProustPeopleVictoria Public Service m Alison WatkinsStrategyMcKinsey & Co