www.commbank.com.au

www.commbank.com.au

Presentation of Half Year Results 13 February 2001 www.commbank.com.au Disclaimer The material that follows is a presentation of general background information about the Banks activities current at the date of the presentation, 13 February 2001. 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. 2 Speakers Notes Speakers notes for this presentation are attached below each slide. To access them, you may need to save the slides in PowerPoint and view/print in notes view. 3 Overview

Significant progress on the integration Strong interest earnings with improved margin Good growth in other banking income Strong new business growth in funds management Good inflows of insurance new business Actions taken to address market share Lower insurance earnings due to weak equity markets Costs reflect volume growth and new businesses $700m off-market share buy-back 4 Agenda Performance Highlights Income and Expenditure Balance Sheet Colonial Merger Funding and Capital 5 Performance Highlights Commonwealth Bank Group Set out in this presentation are unaudited proforma graphs and tables which comprise the profit and loss, balance sheet and life insurance and funds management statistics for the Commonwealth Bank Group and Colonial Limited for the half years ending December 1999 and June 2000. These have been prepared to illustrate the proforma consolidated position of Commonwealth Bank and Colonial as if Colonial had been merged with Commonwealth Bank as at 31 December 1999 for balance

sheet purposes and from 1 July 1999 to 30 June 2000 for profit and loss purposes. The proformas do not include goodwill amortisation or life insurance appraisal value uplift. The results included within the profit and loss have been adjusted for abnormal items and other items not considered part of the ongoing operations, such as the effect of Colonials UK life insurance business which was sold during the year and specific payments made by Colonial in relation to the merger with Commonwealth Bank. [No adjustments have been made for inconsistencies in accounting policies between Colonial and Commonwealth]. Net Operating Profit* 1,200 1,000 1,033 1,035 Dec 1999** Jun 2000** 1,109 800 $m 600 400 200

0 Dec 2000 * Net Profit after tax and outside equity interest - cash basis. Excludes abnormal items, appraisal value uplift and goodwill amortisation. * * Proforma 7 Lending Assets Growth 139,09 2 145.159 147,75 9 * Proforma ** Excludes securitised housing loan balances $4.7b (Dec 2000), $3b (June 2000), $1.7b (Dec1999). 8 Australian Market Share Home loans Jun 2000

Dec 2000 n/a 23.30%* Credit Cards 29.00% 29.00% Personal Loans 24.97% 24.93%* Retail Deposits 25.29% 24.61% Retail FUM 16.00%

16.77%** 9.00% 8.50% Retail Broking * As at 30 November 2000 ** As at 30 September 2000 9 Home Loan Market Share Commonwealth Bank Group Market Share (all lenders) January - November 2000 31.00% 29.00% 27.00% 25.00% 23.00% 21.00% 19.00% 17.00% 15.00% Owner Occupied Approvals Owner

Occupied Balances * * Residentially Secured Approvals ** Residentially Secured Balances ** * Since September APRA all lenders includes home loan reclassification (ie home equity and similar facilities). Figures have been adjusted for HEF proforma back to January 2000. ** APRA data includes owner occupied loans, home equity and similar facilities and investment home loans. 10 New Zealand Market Share ASB Group New Zealand Jun

2000 Dec 2000 Retail Lending 15% 16% Retail Deposits 18% 18.5% Credit Cards 12% 13.8% Retail Funds Management Main Bank Share 3.75% 15% 4.7% est.

16% 11 Domestic Net Interest Margins % 3.50 3.25 3.00 NAB WBC * Proforma ANZ Dec-00 Sep-00 Jun-00 Mar-00 Dec-99 Sep-99 Jun-99

Mar-99 2.75 Commonwealth Bank Group* 12 Income and Expenditure Operating Income 5,000 4,500 4,000 3,500 3,000 $m 2,500 2,000 1,500 1,000 500 0 4,201 4,231 19% 18%

26% 26% 49% 49% Net Interest Income Funds Management Income * Proforma 15% 7% 7% 6% Dec 1999* 4,401 Jun 2000* 27% 51%

Dec 2000 Other Banking Operating Income Life Insurance Income 14 Banking Strong growth in interest income Other Banking Operating Income Commission and other fees, up 14% Trading Income, up 22% Lending Fees, up 4% 15 Funds Management 31/12/99* $M 30/06/00* $M 31/12/00 $M Operating income 255 318

340 Operating expenses 186 224 224 Operating profit before tax 69 94 116 Income tax expense 21 31 38 Operating profit after tax 48

63 78 * Proforma 16 Funds Management 140 120 100 80 $b 60 40 20 0 107 10 92 115 12

23 24 22 21 28 32 35 18 20 23 Dec 1999* Jun 2000 Dec 2000 8 24 14

Australian Retail Funds** International Funds Other Life Assets Australian Wholesale Funds Australian Life Assets * Proforma ** Includes listed property trusts 17 Life Insurance Sources of life insurance operating profit (excluding abnormals) 31/12/99* $M 30/6/00* $M 31/12/00 $M 103 (12) 11 122 (8) 2

128 (33) (3) 102 91 116 52 92 68 193 2 170 (4) 156 The Margin on Services operating profit after tax is represented by : Planned profit margins Experience Variation New business / losses reversal of capitalised losses Operating margins

Investment earnings on assets in excess of policy liabilities Other Operating profit after income tax * Proforma 18 Life Insurance Investment Earnings Target investment mix is 50 : 50 growth : income As at December 2000 38% is directly invested in equity markets 12% is invested in property Overall earnings were adversely impacted by poor equity returns for the period. net earnings on shareholder assets of $21m versus $91m for the same period in 1999 Aust $28m vs $66m NZ $1m vs $7m Asia (-$8m) vs $18m While returns have been poor, they have been in line with market indices (-3%) return on All Ords index [~50% of total share exposure] 3% return on Dow Jones index [~20% of total share exposure] (-3%) return on Euro top 300 [10% of total share exposure] 19 Appraisal Value Uplift Life Business

Australia New Zealand Asia Funds Management Appraisal Value Uplift $m 62 12 115 189 As at 31 December 2000 20 Operating Expense Analysis $m 3,000 2,473 2,500 2,585 46 115 2,000 1,500

1,000 2,349 2,427 2,470 Dec 1999* Jun 2000* Dec 2000 500 0 Existing Operations * Proforma Business acquisitions and GST 21 Cost Ratios 58.4 58.7 55.9

Cost/Assets 2.5 2 1.5 60 55 2.38 2.33 2.32 50 1.81 1.77 1.73 45 1 40 0.5

35 0 30 Dec 1999* Jun 2000* Cost/Income 3 Dec 2000 Cost to Average Balance Sheet Assets Cost to Avg. Balance Sheet Assets & FUM Cost to Income * Proforma 22 Goodwill Asset Quality Goodwill Goodwill amortisation

Colonial Acquisition ASB Group Acquisition of Minority State Bank Victoria Other Group Entities Total HY 31/12/00 $m 136 3 20 4 163 24 Credit Risk Total Risk Rated Exposures % of Exposure 100% 80% 60% 40% 20% 0% 30 June 2000

31 December 2000 Other A BBB AAA/AA 25 Aggregate Provisions 2,000 1,800 1,600 1,400 1,200 $m1,000 800 600 400 200 0 300 250 200 150

% 100 50 0 Jun Dec Jun Dec Jun Dec Jun Dec Jun Dec Jun Dec Jun Dec 94 94 95 95 96 96 97 97 98 98 99 99 00* 00* General Provision Specific Provision Total Provisions/Gross Impaired Assets (axis on right) * Includes Colonial 26 Net Impaired Assets * Commonwealth Bank Group excluding Colonial 27 Colonial Merger Integration Expenditure Restructure Provision Provision 30/06/00 $m

Restructuring Costs Colonial Commonwealth Bank Total restructuring costs (pre tax) 294 106 400 Expenditure Half Year Ended Provision 31/12/00 31/12/00 $m $m 62 41 103 232 65 297 29 Integration Related Staff Movements Business Case Total Staff Movement

Merger Jan-00 Jun-00 Dec-00 Jan to Dec 40,018 39,575 38,028 (1,990) Total Integration Mvt (178) (1,003) (1,181) Retrenchments (129)

(441) (570) Franchise Staff (56) (51) (107) 7 (183) (176) Other Colonial Net Change (853) EDS Migration (328) (328) (1,181) 30

Retrenchment Costs and Estimated Staff Synergies Commonwealth Group* Total $m One-off Retrenchment Costs 50 Annualised Synergies 75 FY2000-2001 Staff Synergies (estimate) 60 * As at 31 December 2000 31 Funding and Capital Funding Sources Retail A$b

Wholesale % At 31 December 2000 $3.6b $5.5b $3.2b Total $30bn $6.8b $1.5b Long Term 54% $3.2b $6.4b Offshore - Public Offshore - Private Domestic - Public Domestic - Private Short

Term USCP 46% NCD ECP 33 Funding Initiatives Commets Issue A$750 m Fixed Rate Bonds The Groups first integrated wholesale & retail transaction launched in Aust mkt Orders taken online via ComSec Minimum parcel size $5000 ASX listing & quotation Japanese Retail Bond Issues Global Mortgage Backed Security

A$450m of retail issues over the last 12 months Two Global deals totalling A$4b over the last 12 months Participation by over 30,000 retail investors Registered with the Japanese Ministry of Finance Most cost-effective source of long term AUD borrowings SEC registered regular global benchmark issuance Benchmark for other Aust. MBS issues Further Global MBS expected during 2001 34 Capital Adequacy 30 Jun 00 Gross Tier I

Less Goodwill Preference Shares intangible component of investment in non- consolidated subsidiaries Net Tier 1 Tier 1 Ratio Upper Tier 2 Lower Tier 2 Total Tier 1 and Tier 2 Less Investment in non consolidated subsidiaries net of intangible component deducted from Tier 1 Other Total Capital Total Capital Ratio 31 Dec 00 18,265 (5,905) (86) 18,409 (6,007) (39) (2,656) 9,618 7.49% 1,292

4,805 15,715 (3,449) 8,914 6.71% 1,346 4,456 14,716 (2,528) (669) 12,518 9.75% (2,169) (109) 12,438 9.37% 35 ROE and EPS ROE EPS 25 100

20 75 15 50 10 25 5 0 0 Dec 1999* ROE - Cash Basis Jun 2000* Dec 2000 EPS ("Cash" Earnings) * As reported in prior profit announcements (i.e. not proforma) 36

Annual Dividends 100 150 90 125 72 66 57 75 46 58 60 52 50 36 50 20

22 20 20 70 58 36 38 45 46 61 49 % Cents 100 25

80 40 30 20 24 10 0 0 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 First Half Second Half Payout Ratio 37 Capital Management Strategy $200 million on market share buy-back announced 24 October 2000 785,173 shares acquired for $23.4 million (weighted average buy-back price $29.86) Programme deferred January 2001 Off market share buy-back of up to $700 million March 2001 Final size of the buy-back subject to take up of new preference share

issue* Scale back if value of shares offered exceed $700 million Will reduce shares on issue by approximately 23 million Allows distribution of surplus franking and enhances EPS The buy-back price has a capital component of $10 with the balance to be a fully franked dividend * See next slide 38 Capital Management Strategy Preference Share Issue of $700 million in April 2001 Qualifies as Tier 1 capital Listed on the ASX Non-cumulative floating rate dividend for the first five years based off the Bank Bill rate Expected to be fully franked Dividends payable quarterly Investor flexibility to exit their investment at the Issue Price on each Rollover date from the fifth year Rated A- / a1 / A+ (Standard & Poors / Moodys / Fitch IBCA) 39 Summary 40 30 30

Share price $ 25 20 20 15 10 10 5 0 Total Shareholder Return % 35 0 Dec 1996 Jun 1997 Dec 1997 Jun 1998

Closing share price at half years ($) Average TSR (ANZ, NAB, Westpac) Dec 1998 Jun 1999 Dec 1999 Jun 2000 Dec 2000 Total Shareholder Return for 5 years (%) 40 Presentation of Half Year Results 13 February 2001 www.commbank.com.au

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