ANZ Announcement

(PR.co.nz) ANZ – Letter to Shareholders

Dear Shareholder,

Over recent months there has been a great deal of debate in Australia about the four major banks. One of the key issues
is competition in the banking sector.

The Parliament of Australia’s Senate Economics Committee is undertaking an inquiry into competition within the banking sector. Our Chief Executive Mike Smith will appear before the inquiry as will the chief executives of the other major banks.

We believe this is an important discussion to have because a strong banking system has been and continues to be critical to Australia’s economic success and our national prosperity.

The global financial crisis has had a devastating effect on many western economies and their banks, particularly those in the United States and in Europe.

Today, of the top 1000 banks in the world, only 11 have a AA credit rating or better*. Four of those are Australian. This is one thing that has set apart Australia’s ability to recover from the effects of the global financial crisis – our stable and safe banks.

Australians can take reassurance from the way the Australian Government, the Reserve Bank of Australia, the Australian Prudential Regulatory Authority and the major banks worked closely together during the financial crisis to ensure our economy did not enter a recession and that as a country we maintained job growth.

However, the global financial crisis has created a very different world.

Many western countries will face years of high unemployment and other challenges as they pay back the government debt they incurred during the financial crisis including the costs of bailing out their banks.

In contrast, Australia remains a strong, stable and growing economy.

We believe that the Australian banks have made a significant contribution to that strength and stability. The finance and insurance industry, of which the banks are a major part, also make an important contribution to the Australian economy.

– The finance and insurance industry directly employs 400,000 Australians, 3.5 per cent of Australia’s total workforce.

– We employ a diverse workforce. Fifty six per cent of employees in the banking industry are female and 44 per cent are male. At ANZ we provide working conditions for our people that include flexible hours, job sharing, 12 weeks’ paid parental leave, part-time work, child care allowances, career extensions for people aged 55 and over, and carers’ leave, lifestyle and study leave.

– Banks pay more than $18 billion a year in wages and more than $8 billion a year in Australian company tax to help provide schools, hospitals, roads and social security benefits. In fact, banks contribute around 17 per cent of the total amount of company tax paid in Australia.

– Finally, the major Australian banks are owned directly and indirectly by almost every adult Australian through their shareholdings and superannuation funds. Profits made by Australian banks are crucial to the returns of Australia’s superannuation funds on which Australians depend for their retirement. This year the major Australian banks paid
$14 billion in dividends to their shareholders.

This is an important time to talk about the role the major banks play in the Australian economy. But the banking industry
is too important to Australia not to have a serious discussion where facts and analysis, not opinions, are put on the table.
We support practical measures which will increase competition and consumer choice in the market without increasing
the cost of banking.

In light of the debate which is occurring we have taken the initiative to provide our perspective to shareholders and we
have tried to answer some of the most often asked questions about banks in the following pages.

If you have other questions that you would like to ask or comments you would like to make, please email us at:
investor.relations@anz.com. You can also read the submission we made to the Senate Inquiry on our website, anz.com.

Thank you for your ongoing support of ANZ.

Media Release on 10 December 2010 from ANZ