摩根士丹利-澳大利亚小型银行：结构性与周期性挑战-Smaller Banks：Structural and Cyclical Challenges-20261020

October20,202607:00PMGMT

AustraliaBanks|AsiaPacific

SmallerBanks:StructuralandCyclicalChallenges

Thesmallerbanksareprogressingontheirstrategiestoaddressstructuralchallenges,butcyclicalheadwindsareemerging.A

weakerrevenuebackdropwillincreasefocusoncostdisciplineandcapitalflexibility.WestayUWBENandEWBOQ.

Addressingstructuralchallenges:BENandBOQfacestructuralchallengesinscale,funding,technology,efficiencyandcapitalrelativetothemajors.Bothhave

strategiestoaddressthesedisadvantages,withBENfocusedonlower-costdepositgrowth,digitalcapabilitiesandproductivity,whileBOQissimplifyingoperations,scalingdigitalplatformsandrecyclingcapitalintohigher-returningsegments.

However,weexpectthebenefitstobelong-datedandexecutionriskstopersist.

Emergingcyclicalheadwinds:Webelievetheoperatingenvironmenthasshiftedmateriallyinthepastyear,withsystemmortgagegrowthexpectedtoslowto~3%inFY27.Weakervolumesshouldincreasecompetitiononbothsidesofthebalancesheetandweighonrevenuegrowthoverthenexttwoyears.

Abalancingactonvolumesandmargins:Forthesmallerbanks,thechallengewillbegrowinglendingwithoutsacrificingmargins.Strongermortgagevolumeswill

likelyleadtomorecompetitivefront-bookpricingandgreaterrelianceonhigher-costdepositsorwholesalefundingifdepositgrowthfailstokeeppace.Weforecastatwo-yearrevenueCAGRofonly~1.5%forBENandBOQacrossFY27-28.

Costdisciplinecomesintofocus:Bothbankshavemeaningfulproductivityprograms,butwebelievehigherwage,technologyandamortisationcostsandongoinginvestmentwillkeeptheirtwo-yearexpenseCAGRsclosetoinflation.

Capitalflexibilityremainsimportant:Weseelimitedscopeforordinarydividendgrowth,giventhemodestearningsoutlook.However,bothbanksretainsound

capitalbuffers,withBENandBOQeachholding>A$200mabovetheirpost-

dividendCET1targetratios.WeexpectBENtotakeamoreconservativeapproachandBOQtohavegreaterflexibilityforcapitalreturns.

WhyUWBENandEWBOQ?:We'reUWonBENgivenitsweakerearningsoutlook,fulltradingmultiples,revenuegrowthconstraints,negative'jaws',andexecution

risk.We'reEWonBOQgivenmoreconfidenceinitsnear-termearningsoutlook,fairtradingmultiples,bettercostmanagementandgreatercapitalflexibility,despite

softrevenuetrendsandalowreturnprofile.

What'schanged?We'veloweredBEN'sEPSestimatesby~3%inFY27-28anditsPTby~7%,butwe'veupgradedBOQ'sEPSestimatesby2-5%anditsPTby~10%.

Withthisreport,SallyHongassumescoverageofBendigoandAdelaideBankLimitedandBankofQueensland.

Foundation

MorganStanleyAustraliaLimited+

SallyHong,CFA

EquityAnalyst

Sally.Hong@+6129770-1698

RichardEWiles

EquityAnalyst

Richard.Wiles@+6129770-1537

AustraliaBanks

AsiaPacific

IndustryView

Cautious

What’sChanged

BankofQueensland(BOQ.AX)

From

To

PriceTarget

A$6.20

A$6.80

BendigoandAdelaideBank

Limited(BEN.AX)

From

To

PriceTarget

A$9.80

A$9.10

RelatedResearch

AustraliaBanks:TheMortgageEffect(6Aug2026)

AustraliaBanks:RevenueHeadwinds(28Jul2026)

MorganStanleydoesandseekstodobusinesswith

companiescoveredinMorganStanleyResearch.Asaresult,investorsshouldbeawarethatthefirmmayhaveaconflictofinterestthatcouldaffecttheobjectivityofMorganStanley

Research.InvestorsshouldconsiderMorganStanley

Researchasonlyasinglefactorinmakingtheirinvestmentdecision.

Foranalystcertificationandotherimportantdisclosures,refertotheDisclosureSection,locatedattheendofthisreport.

+=Analystsemployedbynon-U.S.affiliatesarenotregisteredwithFINRA,maynotbeassociatedpersonsofthememberandmaynotbesubjecttoFINRArestrictionson

communicationswithasubjectcompany,publicappearancesandtradingsecuritiesheldbyaresearchanalystaccount.

2

Foundation

OurInvestmentCase

WhyUWonBEN?

We'reUWonBENgivenitsweakerearningsoutlook,fulltradingmultiples,revenuegrowthconstraints,negative'jaws',andexecutionrisk.

•Weakearningsoutlook:WeforecastBEN'scashearningstodecline~5%inFY27and~3%inFY28,theweakestearningstrajectoryacrossourAustralianbanks

coverage(referExhibit4).

•Fullvaluation:WebelieveBEN'stradingmultiplesaredifficulttojustifygivenitsweakerearningsgrowth,relativetopeers.Basedonourestimates,ittradesonanFY27EP/Emultipleof~14xandanP/NTAmultipleof~1.1xforanRoNTAof~8%.OurpricetargetofA$9.10impliesFY27Emultiplesof~12.5xand~1.0x

respectively,andimpliesdownsideof~10%.

•Revenuegrowthconstraints:Webelieverevenuegrowthremainsconstrainedbythevolume/margintrade-off,withcompetitionlimitingBEN'sabilitytogrow

lendingwithoutsacrificingmargins.

•Negativejaws:Persistentwage,technologyandamortisationpressuresremainheadwinds,whileproductivitybenefitsareweightedtowardslateryear.Assuch,weexpectnegative'jaws'inFY27andFY28,withrevenuegrowthof~1-2%fallingshortofexpensegrowthof~2-4%(referExhibit1andExhibit2).

•Elevatedexecutionrisk:BENfacessignificantexecutionchallengesacrossits

strategicpartnerships,RACQintegrationandnon-financialriskremediation.Webelievetheseinitiativesaddcomplexityanduncertaintytotheearningsrecovery.

•Riskstoourview:Higherinterestratesshouldprovidenear-termbenefitsformarginsthroughthereplicatingportfolio,whileBEN'srelativelylow-riskcreditprofileandsoundcapitalpositionaresupportive.

WhyEWonBOQ?

We'reEWonBOQgivenmoreconfidenceinitsnear-termearningsoutlook,fairtradingmultiples,bettercostmanagementandgreatercapitalflexibility:

•Greaterconfidenceinnear-termearnings:Weforecastmodestearningsgrowthof~1.5%inFY27,supportedbymodestrevenuegrowthandbroadlyflatoperatingcosts.

•Fairtradingmultiples:WeviewBOQ'scurrentvaluationasbroadlyfairgivenitssubduedprofitabilityandmodestearningsgrowthoutlook.Whilethevaluation

offerslimitedscopeforameaningfulre-rating,webelieveitappropriatelyreflectsthebank'snear-termopportunitiesandlonger-termchallenges.Basedonour

estimates,ittradesonanFY27EP/Emultipleof~12xandanP/NTAmultipleof

~0.9xforanRoNTAof~8%.OurpricetargetofA$6.80impliesFY27Emultiplesof~12.0xand~0.9xrespectively,andimpliesdownsideof~1%.

•Bettercostmanagement:BOQhasexecutedwellonitstransformationagenda,deliveringsub-inflationexpensegrowthoverthepasttwoyears.Thisgivesusconfidencethatitcanmeetmanagement'sFY27guidanceforbroadlyflatcosts,

Foundation

supportingpositivejawsasrevenuegrowthrecovers.

•Greatercapitalflexibility:TheequipmentfinancesaletoChallenger

demonstratesBOQ'sabilitytoreleasecapitalwhileretainingoriginationand

servicingincome.ThetransactionsupportedA$295mofplannedcapitalreturns,whilesimilarcapital-lightstructurescouldprovidefurtheropportunitiesto

improvereturns.

However,thisisoffsetby:

•Softrevenuetrends:Weforecastrevenuegrowthofjust~1.5%inFY27andinFY28(referExhibit1).Mortgageportfoliocontraction,loweraverageinterest-earningassetsandongoinglendingcompetitionarelikelytoconstrainrevenuegrowth,despitestrongercommerciallendingandhigherpartnershipincome.

•Lowreturnprofile:BOQ'sreturnonequityremainsaround6%,belowitscostofequity.Whilesimplification,businessmiximprovementandcapitaloptimisation

shouldsupportreturnsovertime,weseelimitedscopeforamaterialimprovementwithoutmoresustainablerevenuegrowth.

EarningsOutlook

Exhibit1:AustraliaBanks:RevenueForecasts

RevenueGrowth

FY24

FY25

FY26E

FY27E

FY28E

ANZ

-1.8%

-0.4%

1.7%

1.1%

1.8%

CBA

0.1%

4.8%

6.2%

4.1%

2.2%

NAB

-2.0%

2.8%

5.7%

1.8%

1.7%

WBC

1.0%

3.2%

1.7%

1.9%

0.8%

Avge

-0.6%

2.6%

3.8%

2.2%

1.6%

BEN

1.1%

-0.4%

5.1%

1.8%

1.1%

BOQ

-8.2%

3.6%

1.3%

1.3%

1.6%

Note:Source:Companydata,MorganStanleyResearchestimates

Exhibit3:AustraliaBanks:Pre-ProvisionForecasts

PPPGrowth

FY24

FY25

FY26E

FY27E

FY28E

ANZ

-10.5%

-3.3%

9.4%

4.2%

3.9%

CBA

-2.9%

3.7%

6.7%

4.0%

0.8%

NAB

-6.9%

1.3%

7.0%

-0.1%

0.3%

WBC

-4.3%

-2.5%

4.3%

2.0%

-0.4%

Avge

-6.2%

-0.2%

6.8%

2.5%

1.1%

BEN

-4.6%

-11.3%

6.7%

-2.0%

-1.0%

BOQ

-27.5%

10.2%

-0.7%

3.3%

0.3%

Source:Companydata,MorganStanleyResearchestimates

Exhibit2:AustraliaBanks:ExpenseForecasts

ExpenseGrowthFY24FY25

FY26EFY27E

FY28E

ANZ4.1%3.9%

-5.1%-2.1%

-0.4%

CBA4.1%6.1%

5.6%4.2%

3.9%

NAB4.5%4.5%

4.2%4.0%

3.3%

WBC7.0%8.9%

-0.5%1.7%

1.9%

Avge4.9%5.8%

1.0%2.0%

2.2%

BEN5.8%7.7%

4.2%4.2%

2.3%

BOQ5.8%0.3%

2.4%0.3%

2.3%

Source:Companydata,MorganStanleyResearchestimates

Exhibit4:AustraliaBanks:CashProfitForecasts

CashProfitGrowthFY24FY25

FY26EFY27E

FY28E

ANZ-8.8%-8.0%

7.0%3.5%

4.3%

CBA-2.8%4.5%

7.3%0.2%

2.3%

NAB-8.1%-0.2%

0.6%0.3%

3.2%

WBC-3.5%-2.0%

-0.7%1.3%

1.1%

Avge-5.8%-1.4%

3.6%1.3%

2.7%

BEN-2.6%-8.4%

3.0%-5.2%

-2.8%

BOQ-23.8%11.7%

-6.5%1.3%

-0.8%

Source:Companydata,MorganStanleyResearchestimates

MorganStanleyResearch3

4

Foundation

Exhibit5:BEN:MorganStanleyForecastsvsConsensus

BEN(A$m)

MSe

Cons

MSevsCons

Revenue

FY27E

2,086

2,137

-2.4%

FY28E

2,102

2,186

-3.9%

FY29E

2,145

2,238

-4.1%

NetInterestMargin

FY27E

1.94%

1.96%

-1bp

FY28E

1.89%

1.93%

-3bp

FY29E

1.85%

1.91%

-2bp

PreProvisionProfit

FY27E

662

747

-11.4%

FY28E

753

840

-10.3%

FY29E

749

864

-13.4%

CashProfit

FY27E

426

482

-11.4%

FY28E

482

539

-10.7%

FY29E

484

550

-12.1%

Note:Includesnotableitems.Source:Visiblealpha,companydata,MorganStanleyResearchestimates

Exhibit6:BOQ:MorganStanleyForecastsvsConsensus

BOQ(A$m)

MSe

Cons

MSevsCons

Revenue

FY27E

1,701

1,702

0.0%

FY28E

1,729

1,734

-0.3%

FY29E

1,772

1,776

-0.2%

NetInterestMargin

FY27E

1.73%

1.72%

1bp

FY28E

1.68%

1.70%

-1bp

FY29E

1.66%

1.68%

-2bp

PreProvisionProfit

FY27E

600

607

-1.1%

FY28E

602

623

-3.4%

FY29E

610

642

-4.9%

CashProfit

FY27E

363

370

-2.1%

FY28E

360

377

-4.5%

FY29E

363

390

-6.7%

Note:IncludesNotableItems.Source:Visiblealpha,companydata,MorganStanleyResearchestimates

ChangestoEarnings

BEN:We'vedowngradedourcashEPSestimatesby~3%inFY27E-FY29E,primarilyduetoweakerhousingandbusinessloangrowthandlowermargins(referExhibit7).

BOQ:We'veupgradedourcashEPSestimatesby~5%inFY27Eand~1%inFY28Eto

reflecttheimpactofabetter2H26marginflowingthroughtoFY27,strongercommercialloangrowthandslightlylowerexpenses,partiallyoffsetbyweakerhousingloangrowth.WealsointroduceourFY29Eestimates(referExhibit8).

Exhibit7:BEN:ChangestoEstimates

New

Previous

∆%

FY27E

CashProfitexNotables

A$m

503

509

-1.3%

BasicCashEPS

¢

72.0

74.3

-3.2%

DilutedEPS

¢

62.6

64.7

-3.2%

DividendperShare

¢

63.0

63.0

0.0%

FY28E

CashProfitexNotables

A$m

488

503

-3.0%

BasicCashEPS

¢

83.6

86.2

-3.0%

DilutedEPS

¢

73.2

75.5

-3.0%

DividendperShare

¢

63.0

63.0

0.0%

FY29E

CashProfitexNotables

A$m

489

505

-3.2%

BasicCashEPS

¢

83.2

86.0

-3.2%

DilutedEPS

¢

73.1

75.5

-3.2%

DividendperShare

¢

63.0

63.0

0.0%

Note:BasicCashEPSestimatesexcludenon-cashitems.DilutedEPSincludesnon-cashitemssuchastheAPRApenalty.Source:Companydata,E=MorganStanleyResearchestimates

Exhibit8:BOQ:ChangestoEstimates

New

Previous

∆%

FY27E

CashProfitexNotables

A$m

363

345

5.1%

BasicCashEPS

¢

56.4

53.9

4.8%

DilutedCashEPS

¢

51.7

50.0

3.5%

DividendperShare

¢

40

40

0.0%

FY28E

CashProfitexNotables

A$m

360

354

1.5%

BasicCashEPS

¢

57.0

56.4

1.2%

DilutedCashEPS

¢

51.3

51.2

0.2%

DividendperShare

¢

40

41

-2.4%

FY29E

CashProfitexNotables

A$m

363

n/a

n/a

BasicCashEPS

¢

57.6

n/a

n/a

DilutedCashEPS

¢

51.8

n/a

n/a

DividendperShare

¢

40

n/a

n/a

Note:BasicandDilutedCashEPSincludesnotableitemssuchasthetechnologyassetimpairmentcharges.Source:Companydata,E=MorganStanleyResearchestimates

MorganStanleyResearch5

Foundation

ChangestoPriceTargets

BEN:We'veloweredourpricetargetby~7%toA$9.10.Ourbullcasevaluationisdown~10%toreflectdowngradestoourbull-caseEPSestimates.Ourbasecasevaluationisdown~5.5%,reflectingearningsdowngradesandtheintroductionofa5%discountto

accountforelevatedexecutionrisk.Thismorethanoffsetsthebenefitofloweringourbetafrom1.1xto1.0x,whichreflectsBEN'simprovedcapitalposition.Ourbearcase

valuationisdown~13%toreflectalowerP/BVmultiple(from0.75xto0.65x)appliedtothelastreportedbookvaluepershare(referExhibit9).

BOQ:We'veincreasedourpricetargetby~9.5%toA$6.80.Ourbullcasevaluationisup~1%toreflectupgradestoourbull-caseEPSestimates.Ourbasecasevaluationisup

~11.5%aswe'veloweredthebeta(from1.1xto1.0x)toreflectastrongercapitalposition.Ourbearcasevaluationisdown~2%toreflectadeclineinthelastreportedbookvaluepershare(referExhibit10).

Exhibit9:BEN:ChangestoPriceTarget

BENSHAREPRICETARGETNewOldChange

12-monthfwdValuation

BullCaseBaseCaseBearCase

Probability

BullCaseBaseCaseBearCase

$12.65$9.03

$7.55

10%

70%

20%

$14.10$9.55

$8.70

10%

70%

20%

-10.3%

-5.5%

-13.2%

12-monthforwardPriceTargetA$9.10A$9.80-7.1%

CurrentPriceA$10.09

Upside/(Downside)(9.8%)

A$0.63

Less:Exp12-monthDiv

Implied12monthTSR(3.6%)

FY27EP/E12.6x

1.0x

6.9%

FY27EP/NTA

FY27EDividendYield

Source:Companydata,MorganStanleyResearchestimates

Exhibit10:BOQ:ChangestoPriceTarget

BOQSHAREPRICETARGETNewOldChange

12-monthfwdValuation

$10.00$6.75$5.20

10%

70%

20%

$9.10$6.05

$5.30

10%

70%

20%

9.9%

11.6%

-1.9%

BullCaseBaseCaseBearCase

Probability

BullCaseBaseCaseBearCase

12-monthforwardPriceTargetA$6.80A$6.209.7%

CurrentPriceA$6.86

Upside/(Downside)

(0.9%)

A$0.40

Less:Exp12-monthDiv

Implied12monthTSR

5.0%

FY27EP/E

FY27EP/NTA

FY27EDividendYield

12.1x0.8x

5.9%

Source:Companydata,MorganStanleyResearchestimates

6

Foundation

RiskReward–BendigoandAdelaideBankLimited(BEN.AX)

MultipleChallenges,WeakerRevenueOutlook

PRICETARGETA$9.10

Basecase(70%):Residualincomemodel,cross-cycleROE~7%,costofequity9%.

Bullcase(10%):Above-averageP/Emultipleof14xone-yearforwardbullcaseEPS.

Bearcase(20%):0.65xlastreportedbookvalueforbearcaseFY27EROEof~5.5%.

Weightingsreflectourviewofeconomicriskandimplicationsforbanks'earningsandreturns.Weapplya-5%discountforourviewonBEN'sbalancesheetstrengthandriskfactors.

A$10.41

ConsensusPriceTargetDistribution

Source:Refinitiv,MorganStanleyResearch

A$9.00A$11.50

MSPT

MeanMorganStanleyEstimates

RISKREWARDCHART

A$12.65(+25.37%)

AUD

12

9

6

3

0

A$9.10(-9.81%)

A$7.55(-25.17%)

A$10.09

OCT'25APR'26OCT'26OCT'27

Key:HistoricalStockPerformanceCurrentStockPricePriceTarget

Source:Refinitiv,MorganStanleyResearch

UNDERWEIGHTTHESIS

▪Challengingoperatingenvironment,withweakprofitgrowth

▪Loangrowthandmargintrade-offconstrainsrevenueupside

▪Wage,technologyandamortisationpressureslimitnear-termproductivitybenefits

▪Elevatedexecutionriskacrossstrategicpartnerships,RACQintegrationandnon-financialriskremediation

▪Long-termROEtargetof>10%looksambitious

BUT

▪Near-termmarginsupportfromhigherrates

▪Buildingdigitalcapabilities

▪Businessmixunderpinslowcreditriskprofile

▪Soundcapitalposition

ConsensusRatingDistribution

17%Overweight 58%Equal-weight25%Underweight

MSRating

Source:Refinitiv,MorganStanleyResearch

RiskRewardThemes

PricingPower:Negative

Self-help:Positive

ViewdescriptionsofRiskRewardsThemeshere

A$12.65

BULLCASE

~14xbull-caseFY26EEPS

Inascenariowhereaneconomicupswing

skewsriskstotheupside,wethinkinvestorsplacelessemphasisoncross-cycleROEandmoreonnear-termearningstrends.In

determiningourbull-casevaluation,we

applyanabove-averageP/Emultipleof14xP/Etoourone-yearforwardbull-caseEPSforecast.

A$9.03

BASECASE

~13xbase-caseFY27EEPS

Belowsystemvolumegrowth,lower

margins,lowtomidsingledigitcostgrowth,loanlosschargestrendinghigherfroma

verylowbase.Inourbase-caseRIVM,weassumeacross-cycleROEof~7%andcostofequityof9%.

BEARCASEA$7.55

0.65xreportedbookvalue

Inascenariowheredownsiderisksare

higher,wethinkinvestorsplaceless

emphasisoncross-cycleROEandmore

emphasisonnear-termbalancesheetandcapitalrisks.Ourbearcaseisdesignedtofocusonbookvalueastheanchorfor

valuationwhenthereisuncertaintyin

relationtonear-termearningsanddividend.Todothis,weapplya0.65xP/BVmultipletolastreportedbookvalue.

MorganStanleyResearch7

Foundation

RiskReward–BendigoandAdelaideBankLimited(BEN.AX)

KEYEARNINGSINPUTS

Jun2026

1.5

Jun2027e

2.5

Jun2028e

3.6

Jun2029e

4.4

Drivers

LoanGrowth(y-o-y)(%)

NetInterestMargins(%)

1.92

1.92

1.88

1.83

RevenueGrowth(y-o-y)(%)

5.1

1.8

1.1

2.0

ExpenseGrowth(y-o-y)(%)

17.5

0.9

(6.4)

3.6

ImpairmentCharges/TotalLoans(%)

0.02

0.05

0.06

0.05

CATALYSTCALENDAR

DateEventSource:Refinitiv,MorganStanley

20Oct2026BEN2026AnnualGeneralMeeting

25Nov2026BEN2026InvestorDay

INVESTMENTDRIVERS

Impactofinterestrates,competition,andpricingpoweronmargins

Growthinmortgagesanddeposits

Investment,productivityandexpensegrowthLoanlosses

Capitalrequirementsanddividendprospects

Nicheinvestments,partnershipsandacquisitions

GLOBALREVENUEEXPOSURE

100%

APAC,exJapan,Mainland

ChinaandIndia

Source:MorganStanleyResearchEstimateViewexplanationofregionalhierarchieshere

MSALPHAMODELS

4/53Month

MOSTHorizon

Source:Refinitiv,FactSet,MorganStanleyResearch;1isthehighestfavoredQuintileand5istheleastfavoredQuintile

RISKSTOPT/RATING

RISKSTOUPSIDE

Strongermortgageanddepositgrowth

Bettermarginsfromreducedcompetition,

higherratesor"backbook"re-pricingBettercostcontrol

Lower-for-longerloanlosses

Value-enhancingacquisitions/partnerships

RISKSTODOWNSIDE

Extramarginpressurefromcompetition

Lowervolumesandfallingnon-interestincomeInvestingforgrowthandrisingCTIratio

HigherloanlossesAcquisitionrisk

Dividendcut

OWNERSHIPPOSITIONING

Inst.Owners,%Active24.8%

Source:Refinitiv,MorganStanleyResearch

MSESTIMATESVS.CONSENSUS

FYJun2027e

Sales/

Revenue

2,0822,176

(A$,mn)

2,132

EBITDA

(A$,mn)

604

Note:Therearenotsufficientbrokerssupplyingconsensusdataforthismetric

Netincome

(A$,mn)

410

410563

476

EPS

(A$)

0.630.97

0.78

MeanMorganStanleyEstimates

Source:Refinitiv,MorganStanleyResearch

8

Foundation

BEN:FinancialSummary

Exhibit11:BEN:FinancialSummary

INCOMESTATEMENT(A$m)SHARERATIOS&VALUATION

YearEnd30June

FY25

1H26

2H26

FY26

1H27E

2H27E

FY27E

FY28E

FY29E

YearEnd30JuneFY26

FY27EFY28EFY29E

ExcludesNotableItemsNetInterestIncome

MarginBeforeRevenueShareReportedNetInterestMargin

CashNetInterestMargin

FeesIncome

HomesafeRealisedIncome

OtherBankingIncome

WealthManagementIncome

NonInterestIncomeTotalIncome

BAUExpenses

InvestmentSpending

TotalOperatingExpenses

CosttoIncomeRatio(ExNotables)Pre-ProvisionProfit

ImpairmentCharges

OperatingProfitBeforeTax

TaxExpense

CashProfitexNotableItems

NotableItems(Post-Tax)CashProfit

Non-CashItems(Post-Tax)

ReportedProfit

1,678.8

2.30%

1.84%

1.88%

120.8

39.9

41.6

65.5

267.81,946.6

-1,088.7

-120.7

-1,209.4

62.1%

737.2

14.7

751.9

-237.3

514.6

0.0

514.6

-611.7

-97.1

871.1

2.33%

1.89%

1.92%

63.3

21.3

17.8

36.4

138.81,009.9

-578.6

-57.9

-636.5

63.0%

373.4

2.4

375.8

-119.4

256.4

-31.9

224.5

6.1

230.6

884.9

2.42%

1.96%

1.98%

67.3

27.5

16.7

39.6

151.11,036.0

-563.4

-59.7

-623.1

60.1%

412.9

-15.7

397.2

-123.4

273.8

-83.6

190.2

-45.7

144.5

1,756.0

2.37%

1.92%

1.95%

130.6

48.8

34.5

76.0

289.9

2,045.9

-1,142.0-117.6

-1,259.6

61.6%

786.3

-13.3

773.0

-242.8

530.2

-115.5

414.7

-39.6

375.1

902.5

2.38%

1.94%

1.95%

65.3

22.6

17.0

42.4

147.41,049.8

-594.2

-60.3

-654.5

62.3%

395.3

-17.6

377.7

-116.2

261.5

-63.3

198.2

-4.0

194.2

884.9

2.34%

1.91%

1.92%

65.9

21.8

17.4

43.7

148.81,033.7

-598.0

-60.3

-658.3

63.7%

375.5

-26.6

348.9

-107.8

241.1

-21.7

219.3

-3.3

216.0

1,787.4

2.36%

1.92%

1.94%

131.2

44.4

34.4

86.1

296.12,083.5

-1,192.1-120.6

-1,312.7

63.0%

770.8

-44.2

726.6

-224.0

502.6

-85.1

417.5

-7.2

410.3

1,800.7

2.31%

1.88%

1.89%

133.9

41.3

35.8

94.1

305.12,105.8

-1,221.2-121.9

-1,343.1

63.8%

762.7

-54.8

707.9

-219.4

488.4

0.0

488.4

-5.9

482.5

CurrentSharePrice(A$)

1,832.5ModelwarePERatio(x)

2.27%BasicCashPERatio(x)

1.83%BasicCashexNotablesPERatio(x)

1.85%UnderlyingProfitperShare

136.5P/UPMultiple(x)

38.5NTAperShare(A$)

37.2BookValueperShare(A$)

102.8Price/NTA(x)

315.1Price/BookValue(x)

2,147.6DividendperShare(cps)

-1,266.9DividendPayoutRatio(%)

-124.0DividendPayoutRatioexNotables(%)-1,390.9DividendYield(%)

64.8%IssuedShares(m)

756.7WeightedAverageShares(m)-47.6FullyDilutedShares(m)

709.1

17.3

13.8

10.8

1.109.2

9.19

11.61

1.10

0.8763

87.3

87.3

6.2

580.1

569.1

644.4

16.1

14.0

11.6

1.129.0

9.31

11.68

1.08

0.8663

88.0

77.1

6.2

584.3

579.9

655.2

13.8

12.1

12.1

1.317.7

9.57

11.87

1.05

0.8563

75.8

66.3

6.2

588.3

584.0

659.3

$10.0913.8

12.1

12.1

1.297.8

9.8212.07 1.030.84

63

76.0

66.5

6.2

591.9

587.8

663.0

-219.8

489.3

0.0

489.3

-4.7

484.6

Profitability

Income/AvgAssets(%)

Expenses/AvgAssets(%)

UnderlyingProfit/AvgAssets(%)ReturnonAvgAssets(ROA)(%)

Gearing(x)

2.181.510.67

0.4414.1

2.181.500.68

0.4414.1

2.131.360.77

0.5014.3

2.101.360.74

0.4814.4

BasicCashEPS(cps)

91.0

39.7

33.2

72.9

34.2

37.7

72.0

83.6

83.2

ReturnonOrdinaryEquity(ROE)(%)

6.2

6.2

7.1

6.9

BasicCashEPSexNotables(cps)

91.0

45.3

47.8

93.2

45.2

41.5

86.7

83.6

83.2

ReturnonNetTangibleAssets(RoNTA)(%)

7.9

7.8

8.8

8.6

BasicEPS(cps)

DilutedEPS(cps)

DividendperShare(cps)

-17.2

-14.4

63.0

40.8

36.2

30.0

25.2

22.3

33.0

65.9

58.2

63.0

33.6

29.7

30.0

37.2

32.9

33.0

70.7

62.6

63.0

82.6

73.2

63.0

82.4

73.1

63.0

ReturnonNetTangibleAssetsexNotables(%)NonInterestIncome/TotalIncome(%)

Cost/Income(%)

EffectiveTaxRate(%)

10.1

14.2

61.6

32.3

9.4

14.2

63.0

31.0

8.8

14.5

63.8

31.0

8.6

14.7

64.8

31.0

BALANCESHEETDATA(A$m)

TotalAssets

HousingLoans

Non-HousingLoans

TotalGrossLoans

RetailDeposits

Securitization

OrdinaryShareholders'Equity

Shareholders'Equity(incl.hybridequity)

103,219

66,644

19,199

85,844

72,514

2,500

6,670

6,670

101,301

65,141

19,076

84,217

73,350

2,500

6,644

6,644

104,411

66,352

20,784

87,136

74,134

2,500

6,735

6,735

104,411

66,352

20,784

87,136

74,134

2,500

6,735

6,735

104,719

67,015

20,394

87,409

75,171

2,500

6,761

6,761

106,928

67,685

21,613

89,298

76,350

2,500

6,824

6,824

106,928

67,685

21,613

89,298

76,350

2,500

6,824

6,824

110,672

69,731

22,758

92,490

79,556

2,500

6,984

6,984

115,426

72,548

23,973

96,521

83,191

2,500

7,144

7,144

CAPITALADEQUACY

CreditRiskWeightedAssets(A$m)

RiskWeightedAssets(A$m)

CreditRWA/TotalLoans(%)

CommonEquityTier1Capital(A$m)

AdditionalTier1Capital(A$m)

Tier1Capital(A$m)

APRABaselIIICET1Ratio(%)

Tier1Ratio(%)

TotalCapitalRatio(%)

OrdinaryShareholders'Equity/TotalAssets(%)DividendReinvestmentPlan(DRP)(A$m)

36,405

40,014

41.8

4,537

802

5,339

11.3413.34

15.136.5

0

37,292

40,989

41.8

4,610

802

5,413

11.2513.21

14.996.446

38,610

42,436

41.7

4,748

802

5,550

11.1913.08

14.876.346

40,275

44,265 41.74,879802

5,68211.0212.84

14.626.246

AvgLoans

AvgInterestEarning