WNZL Disclosure Statement – 31 March 2020

ASX Release


25 MAY 2020

Westpac New Zealand Limited Disclosure Statement

Westpac Banking Corporation (“Westpac”) today provides the attached Westpac New
Zealand Limited Disclosure Statement for the six months ended 31 March 2020.








For further information:

David Lording Andrew Bowden
Group Head of Media Relations Head of Investor Relations
0419 683 411 T. (02) 8253 4008 (ext. 24008)
M. 0438 284 863


This document has been authorised for release by Tim Hartin, Group Company Secretary.


Level 18, 275 Kent Street
Sydney, NSW, 2000

Westpac
New Zealand
Limited
Di
sclosure Statement
For the six months ended 31 March 2020

This page has been intentionally left blank

Westpac New Zealand Limited 3
Contents
Westpac New Zealand sustainability performance4
Directors’ statement5
Financial statements
Income statement6Note 6 Provisions for expected credit losses15
Statement of comprehensive income6Note 7 Deposits and other borrowings20
Balance sheet7Note 8 Debt issues20
Statement of changes in equity8Note 9 Related entities20
Statement of cash flows9
Note 1 Statement of accounting policies10
Note 10 Fair values of financial assets and financial
liabilities
21
Note 2 Net interest income12
Note 3 Non-interest income13
Note 11 Credit related commitments, contingent
assets and contingent liabilities
24
Note 4 Impairment charges/(benefits)14Note 12 Segment reporting24
Note 5 Loans14Note 13 Subsequent events25
Registered bank disclosures
i. General information26
ii. Additional financial disclosures28
v. Concentration of credit exposures to individual
counterparties
47
iii. Asset quality33vi. Insurance business48
vii. Risk management policies48
iv. Capital adequacy under the internal models
based approach, and regulatory liquidity ratios
36
Conditions of registration49
Independent auditor’s review report51
Glossary of terms
Certain information contained in this Disclosure Statement is required by the Registered Bank Disclosure Statements (New Zealand Incorporated
Registered Banks) Order 2014 (as amended) (‘Order’).
In this Disclosure Statement, reference is made to:
– Westpac New Zealand Limited (otherwise referred to as the ‘Bank’);
– Westpac New Zealand Limited and its controlled entities (otherwise referred to as the ‘Banking Group’);
– Westpac Banking Corporation (otherwise referred to as the ‘Ultimate Parent Bank’); and
– Ultimate Parent Bank and its controlled entities (otherwise referred to as the ‘Ultimate Parent Bank Group’).
Words and phrases not defined in this Disclosure Statement, but defined by the Order, have the meaning given by the Order when used in
this Disclosure Statement.

4 Westpac New Zealand Limited
Westpac New Zealand sustainability performance
Helping our people, customers and communities financially, to grow a better New Zealand
We are committed to creating shared value – for our customers, our
shareholders, our people and our communities. We do this through
our core business, which is focused on helping our customers grow
their financial wellbeing, and more widely by using our financial and
economic expertise to generate positive economic, social and
environmental outcomes for our customers and New Zealand.
Our 2018- 2020 sustainability strategy focuses on:
Growing New Zealanders’ financial wellbeing
Taking action on climate change
Caring for people and communities.
Grow New Zealanders’ financial wellbeing
Increased economic participation and inclusive prosperity is
beneficial to all. We want all New Zealanders to be financially secure
and independent, enabling them to reach their full potential. We aim
to 1. Grow the financial capability of our communities and our people
by integrating financial capability into everyday banking, and 2. Grow
financial independence by helping New Zealanders participate in the
economy and grow their wealth.
2020 targetsProgress
1.20,000 financial education workshop
participants
17,623
participants
2.Introduce a new product or service to
tackle financial exclusion and poverty
2 initiatives in
progress
3.Provide $300m in lending to social
and affordable housing
1
$216m
Key highlights for the six months ended 31 March 2020 include:
Launching a modern papakāinga shared equity housing
development initiated on iwi land with Ngāti Koroki Kahukura.
Hosting the Inclusive Growth Symposium with MasterCard
attended by over 100 key stakeholders from the private, public
and non-profit sector.
Take action on climate change
We want to lead New Zealand’s transition to a resilient, low-
emissions economy that continues to grow to the benefit of future
generations.
TargetsProgress
1.Reduce our operational emissions by
30% by 2025 (2019 baseline)
2
3%
2.Convert 100% of our car fleet to
electric vehicles or PHeV
3
by 2025
34%
3.Provide $2 billion in lending to business
customers for climate change solutions by
30 September 2020
$1.7b
We recognise climate change is a major threat to our environment,
economy and wellbeing. However, it also presents opportunities for
new products and services, technologies and jobs. We believe
business and the financial sector has a major role to play.
Our strategy is to address climate change with urgency by reducing,
disclosing and offsetting our own emissions, better understanding
our exposure to climate risk and helping our customers manage their
transition to a low carbon economy through innovative sustainable
finance structures. We want to ensure capital flows to those parts of
the economy where it is needed most to facilitate that transition
efficiently and effectively.
Key highlights for the six months ended 31 March 2020 include:
Becoming the first New Zealand bank to be Toitū carbonzero
certified. To achieve this, we are actively reducing our
greenhouse gas emissions, and offsetting the remainder by
purchasing New Zealand native permanent forestry carbon
credits. We have also committed to reducing our emissions by a
further 30% by 2025.
Announcing a new product for customers, ‘Westpac WarmUp’,
which offers our new and existing home loan customers an
interest-free loan of up to $10,000 to improve their homes’
energy-efficiency by installing heat pumps, solar panels,
ventilation, double glazing and insulation.
Entering into a $50 million, four-year sustainability-linked loan
facility with Contact Energy, the first such loan issued by
Westpac NZ and one of the first of its kind in New Zealand.
Progressing a scenario analysis to better understand the Bank’s
exposure to climate risk and sea level rise, taking guidance from
the recommendations of the Taskforce for Climate-Related
Financial Disclosure.
Co-chairing the Sustainable Finance Forum, which published its
Interim Report on how to make NZ’s financial system more
sustainable. To read the report, visit:
www.theaotearoacircle.nz/sustainablefinance
Care for people and communities
We want to help create thriving New Zealand communities and a
workforce and society where everyone feels valued.
2020 targetsProgress
1.Raise $3 million for Westpac
Rescue Choppers
$2.79m
2.50% Women in Leadership50.9%
Key highlights for the six months ended 31 March 2020 include:
Launching the Gender Pay Report, voluntarily disclosing our
gender pay gap and announcing commitments towards closing
it.
Receiving the Gender Tick, for initiatives including a gender
inclusive culture, parental leave, safe workplace, flexible work,
equal pay and leadership representation.
Work has commenced to update our Sustainability Strategy beyond
2020 through initial consultation with key internal and external
stakeholders. The overall objective is to raise Westpac NZ’s overall
sustainability ambitions and identify areas with the most effective
impact. For more information on our approach to sustainability visit
www.westpacsustainability.co.nz
We're all in this together – supporting our communities
through COVID-19
We have all been impacted by COVID-19 in different ways. Westpac
has donated an extra $1 million to support New Zealand’s rescue
helicopters, which are facing a serious fundraising shortfall due to
the impacts of COVID-19, and we’ve been actively working with our
charity partners to see how we can support them through this time.
We know that lockdown increased stress and so we've partnered
with Kiwibank to assist Sir John Kirwan to release his Mentemia
mental health app free of charge for all New Zealanders.
Unfortunately there has been a rise in the number of women and
children needing help from domestic abuse charities across New
Zealand. We have added an icon on the bottom of the Westpac New
Zealand Limited website which opens a secure, untraceable, online
chat with Women's Refuge.
1
Does not include Kiwibuild or shared equity.
2
Environmental year runs 1 July to 30 June. CO
2
e results include all Westpac business units based in New Zealand. In 2019, we changed the way we measure and report carbon emissions, to align with the
Greenhouse Gas Protocol (2004) and ISO 14064-1:2006 Specification as required by Toitū Envirocare, our carbonzero programme certifier, which also resulted in setting a new 2025 target.
3
Plug in Hybrid electric Vehicles. In March 2020 we announced a revised target of 100% conversion by 2025, replacing the prior target of 30% by 2020 which was achieved in FY2019.

Westpac New Zealand Limited 5
Directors’ statement
Each Director of the Bank believes, after due enquiry, that, as at the date on which this Disclosure Statement is signed, the Disclosure Statement:
(a) contains all the information that is required by the Order; and
(b) is not false or misleading.
Each Director of the Bank believes, after due enquiry, that over the six months ended 31 March 2020:
(a) the Bank has complied with all conditions of registration that applied during that period, except as noted on page 49;
(b) credit exposures to connected persons were not contrary to the interests of the Banking Group; and
(c) the Bank had systems in place to monitor and control adequately the Banking Group’s material risks, including credit risk,
concentration of credit risk, interest rate risk, currency risk, equity risk, liquidity risk, operational risk and other business risks, and that
those systems were being properly applied.
This Disclosure Statement has been signed by all the Directors:
Janice Dawson
David McLean
Malcolm Bailey
Philippa Greenwood
Jonathan Mason
Mary Quin
Dated this 21
st
day of May 2020

Income statement for the six months ended 31 March 2020
6 Westpac New Zealand Limited
THE BANKING GROUP
Six MonthsSix Months
EndedEnded
31 Mar 2031 Mar 19
$ millionsNoteUnauditedUnaudited
Interest income:
Calculated using the effective interest rate method2 1,860 2,028
Other2 19 15
Total interest income2 1,879 2,043
Interest expense2 (923) (1,060)
Net interest income 956 983
Net fees and commissions income3 122 143
Other income3 15 45
Net operating income before operating expenses and impairment charges 1,093 1,171
Operating expenses (525) (468)
Impairment (charges)/benefits4 (210) (14)
Profit before income tax 358 689
Income tax expense (102) (180)
Net profit attributable to the owners of the Banking Group 256 509
The above income statement should be read in conjunction with the accompanying notes.
Statement of comprehensive income for the six months ended 31 March 2020
THE BANKING GROUP
Six MonthsSix Months
EndedEnded
31 Mar 2031 Mar 19
$ millions
UnauditedUnaudited
Net profit attributable to the owners of the Banking Group 256 509
Other comprehensive income
Items that may be reclassified subsequently to profit or loss
Gains/(losses) recognised in equity on:
Investment securities (20) (6)
Cash flow hedging instruments 39 (82)
Transferred to income statement:
Cash flow hedging instruments 48 21
Income tax on items taken to or transferred from equity:
Investment securities 5 2
Cash flow hedging instruments (24) 17
Items that will not be reclassified subsequently to profit or loss (net of tax)
Remeasurement of defined benefit obligation (6) (8)
Other comprehensive income for the period (net of tax) 42 (56)
Total comprehensive income attributable to the owners of the Banking Group 298 453
The above statement of comprehensive income should be read in conjunction with the accompanying notes.

Balance sheet as at 31 March 2020
Westpac New Zealand Limited 7
THE BANKING GROUP
31 Mar 2030 Sep 19
$ millionsNote
UnauditedAudited
Assets
Cash and balances with central banks 5,096 1,864
Collateral paid 150 168
Trading securities and financial assets measured at fair value through income statement ('FVIS') 3,405 1,661
Derivative financial instruments 1,136 616
Investment securities 3,778 4,469
Loans5 87,005 84,160
Other financial assets 175 178
Due from related entities 4,519 2,571
Property and equipment 421 137
Deferred tax assets 217 174
Intangible assets 621 636
Other assets 54 42
Total assets 106,577 96,676
Liabilities
Collateral received 1,161 473
Deposits and other borrowings7 72,594 65,606
Other financial liabilities 652 455
Derivative financial instruments 202 257
Debt issues8 19,526 17,846
Current tax liabilities 13 72
Provisions 192 144
Other liabilities 388 96
Total liabilities excluding related entities liabilities 94,728 84,949
Due to related entities 1,903 1,701
Loan capital 2,556 2,609
Total related entities liabilities 4,459 4,310
Total liabilities 99,187 89,259
Net assets 7,390 7,417
Shareholder's equity
Share capital 7,300 7,300
Reserves (29) (77)
Retained profits 119 194
Total shareholder's equity 7,390 7,417
The above balance sheet should be read in conjunction with the accompanying notes.

Statement of changes in equity for the six months ended 31 March 2020
8 Westpac New Zealand Limited
THE BANKING GROUP
Reserves
Available-
for-saleInvestmentCash Flow
Share SecuritiesSecuritiesHedgeRetained
$ millions
Capital ReserveReserveReserveProfitsTotal
As at 30 September 2018 (Audited) 5,100 9 - (60) 2,229 7,278
Impact on adoption of new accounting standards
- (9) 9 - (24) (24)
As at 1 October 2018 (Restated) 5,100 - 9 (60) 2,205 7,254
Six months ended 31 March 2019 (Unaudited)
Net profit attributable to the owners of the Banking Group - - - - 509 509
Net gains/(losses) from changes in fair value - - (6) (82) - (88)
Income tax effect - - 2 23 - 25
Transferred to income statement - - - 21 - 21
Income tax effect - - - (6) - (6)
Remeasurement of defined benefit obligations - - - - (11) (11)
Income tax effect - - - - 3 3
Total comprehensive income for the six months
ended 31 March 2019 - - (4) (44) 501 453
Transactions with owners:
Ordinary share capital issued 1,500 - - - - 1,500
Dividends paid on ordinary shares - - - - (1,890) (1,890)
As at 31 March 2019 (Unaudited) 6,600 - 5 (104) 816 7,317
As at 30 September 2019 (Audited) 7,300 - 4 (81) 194 7,417
Six months ended 31 March 2020 (Unaudited)
Net profit attributable to the owners of the Banking Group - - - - 256 256
Net gains/(losses) from changes in fair value - - (20) 39 - 19
Income tax effect - - 5 (11) - (6)
Transferred to income statement - - - 48 - 48
Income tax effect - - - (13) - (13)
Remeasurement of defined benefit obligations - - - - (8) (8)
Income tax effect
-
- - -
2
2
Total comprehensive income for the six months
ended 31 March 2020 - - (15) 63 250 298
Transactions with owners:
Dividends paid on ordinary shares (refer to Note 9) - - - - (325) (325)
As at 31 March 2020 (Unaudited) 7,300 - (11) (18) 119 7,390
The above statement of changes in equity should be read in conjunction with the accompanying notes.

Statement of cash flows for the six months ended 31 March 2020
Westpac New Zealand Limited 9
THE BANKING GROUP
Six MonthsSix Months
EndedEnded
31 Mar 2031 Mar 19
$ millionsUnauditedUnaudited
Cash flows from operating activities
Interest received 1,902 2,039
Interest paid (996) (1,096)
Non-interest income received 116 166
Operating expenses paid (438) (439)
Income tax paid (220) (243)
Cash flows from operating activities before changes in operating assets and liabilities 364 427
Net (increase)/decrease in:
Collateral paid 18 (224)
Trading securities and financial assets measured at FVIS (1,744) (114)
Loans (2,999) (1,692)
Other financial assets 5 (8)
Due from related entities (2,131) (74)
Other assets (5) (3)
Net increase/(decrease) in:
Collateral received 688 (261)
Deposits and other borrowings 6,988 2,012
Other financial liabilities 250 (97)
Due to related entities 491 73
Other liabilities 14 4
Net movement in external and related entity derivative financial instruments 114 5
Net cash provided by/(used in) operating activities 2,053 48
Cash flows from investing activities
Purchase of investment securities (65) (1,535)
Proceeds from investment securities 714 1,363
Proceeds from disposal of associates - 48
Purchase of capitalised computer software (24) (21)
Purchase of property and equipment (4) (15)
Proceeds from disposal of property and equipment - 3
Net cash provided by/(used in) investing activities 621 (157)
Cash flows from financing activities
Issue of ordinary share capital - 1,500
Net movement in due to related entities
(22)
(25)
Proceeds from debt issues
3,029
1,721
Repayments of debt issues
(2,093)
-
Payments for the principal portion of lease liabilities
(31)
-
Dividends paid to ordinary shareholders (325) (1,890)
Net cash provided by/(used in) financing activities 558 1,306
Net increase/(decrease) in cash and cash equivalents 3,232 1,197
Cash and cash equivalents at beginning of the period 1,864 1,353
Cash and cash equivalents at end of the period 5,096 2,550
Cash and cash equivalents at end of the period comprise:
Cash on hand 350 210
Balances with central banks 4,746 1,950
Interbank lending classified as cash and cash equivalents
1
- 390
Cash and cash equivalents at end of the period 5,096 2,550
1
Interbank lending is included within other financial assets on the balance sheet.
The above statement of cash flows should be read in conjunction with the accompanying notes.

Notes to the financial statements
10 Westpac New Zealand Limited
Note 1 Statement of accounting policies
These condensed consolidated interim financial statements (‘financial statements’) have been prepared and presented in accordance with the
Order and Generally Accepted Accounting Practice, as appropriate for for-profit entities, and the New Zealand equivalent to International
Accounting Standard 34 Interim Financial Reporting and should be read in conjunction with the financial statements included in the Disclosure
Statement for the year ended 30 September 2019. These financial statements comply with International Accounting Standard 34 Interim Financial
Reporting as issued by the International Accounting Standards Board (‘IASB’).
Financial statements preparation
These financial statements have been prepared under the historical cost convention, as modified by applying fair value accounting to investment
securities and financial assets and financial liabilities (including derivative instruments) measured at FVIS or in other comprehensive income
(‘FVOCI’). The going concern concept has been applied.
All amounts in these financial statements have been rounded to the nearest million dollars unless otherwise stated.
Comparative information has been revised where appropriate to enhance comparability.
All policies have been applied on a basis consistent with that used in the financial year ended 30 September 2019, except as set out in the
‘amendments to accounting standards effective this period’ section below.
The areas of judgement, estimates and assumptions in these financial statements, including the key sources of estimation uncertainty, are
consistent with those in the Disclosure Statement for the year ended 30 September 2019 except for as noted below:
Goodwill
As at 31 March 2020, the COVID-19 pandemic has led to significant changes with adverse effects to the Banking Group’s economic environment,
which is an indicator of impairment. As a result, an impairment test was performed which confirmed that the Banking Group continues to have
considerable headroom when determining whether goodwill is recoverable, and no impairment should be recognised.
We have reassessed the base assumptions and revised them where we consider it necessary in order to provide a reasonable estimate of the value-
in-use of the business units and the Banking Group in the current environment. We have revised the assumptions used at 30 September 2019 as
reported in the Disclosure Statement from a zero growth rate beyond 2 year forecasts to a 2% growth rate beyond 3.5 year forecasts.
Given the uncertainty of a rapidly changing economic environment, market sentiment, and regulatory and industry responses, the forecasts are
likely to change. This will continue to be reviewed and a further impairment test will be performed at year end.
Provisions for expected credit losses (‘ECL’)
Details on specific judgements in relation to the impact of COVID-19 on the calculation of provisions for ECL are included in Note 6.
Amendments to Accounting Standards effective this period
NZ IFRS 16 Leases
NZ IFRS 16 Leases (‘NZ IFRS 16’) was adopted by the Banking Group on 1 October 2019. NZ IFRS 16 requires all operating leases of greater than 12
months duration be presented on balance sheet by the lessee as a right-of-use (‘ROU’) asset and lease liability. There are no significant changes to
lessor accounting.
The Banking Group adopted the standard using the simplified approach to transition with no restatement of comparative information and no effect
on retained earnings.
The lease liabilities are measured at the present value of the remaining lease payments, discounted at the lessee’s incremental borrowing rate at 1
October 2019. On transition to the new standard, the lease liability recognised in other liabilities was $292 million. The associated ROU assets were
measured at an amount equal to the lease liability. The ROU assets are recognised in property and equipment.
All leases on balance sheet give rise to a combination of interest expense on the lease liability and depreciation of the ROU asset. Interest expense is
recognised in net interest income on an effective yield basis. Depreciation expense is recognised in operating expenses on a straight-line basis over
the lease term.
Extension options are included in a number of lease contracts. The extension options are only included in the lease term if the lease is reasonably
certain to be extended, which is assessed by the Banking Group at the lease commencement date. The assessment is reviewed if a significant event
or significant change in circumstances occurs which affects this assessment and is within the control of the Banking Group.
The Banking Group used the incremental borrowing rate based on the remaining maturity of leases at the date of transition as the discount rate
when determining present value. The weighted average incremental borrowing rate applied was 2.40%.
The table below shows the reconciliation of operating lease commitments disclosed as at 30 September 2019 to the lease liability recognised on 1
October 2019:

Notes to the financial statements
Westpac New Zealand Limited 11
Note 1 Statement of accounting policies (continued)
THE BANKING GROUP
$ millions
Operating lease commitments at 30 September 2019 (Audited) 306
Recognition exemption for short-term leases
(2)
Adjustment for extension options reasonably certain to be exercised
21
Undiscounted lease payments as at 30 September 2019 325
Effect of discounting (weighted average incremental borrowing rate of 2.40%) (33)
Lease liability as at 1 October 2019 (Audited) 292
NZ IFRIC 23 Uncertainty over Income Tax Treatments
NZ IFRIC 23 Uncertainty over Income Tax Treatments (‘NZ IFRIC 23’) was adopted by the Banking Group on 1 October 2019. NZ IFRIC 23 clarifies the
recognition and measurement criteria in NZ IAS 12 Income Taxes where there is uncertainty over income tax treatments, and requires an assessment
of each uncertain tax position as to whether it is probable that a taxation authority will accept the position.
Where it is not considered probable, the effect of the uncertainty will be reflected in determining the relevant taxable profit or loss, tax bases,
unused tax losses and unused tax credits or tax rates. The amount will be determined as either the single most likely amount or the sum of the
probability weighted amounts in a range of possible outcomes, whichever better predicts the resolution of the uncertainty. Judgements will be
reassessed as and when new facts and circumstances are presented.
NZ IFRIC 23 did not have a material impact on the Banking Group.
Interest Rate Benchmark Reform
Interest Rate Benchmark Reform - amendments to NZ IFRS 9 Financial Instruments (‘NZ IFRS 9’), NZ IAS 39 Financial Instruments: Recognition and
Measurement (‘NZ IAS 39’) and NZ IFRS 7 Financial Instruments: Disclosures (‘NZ IFRS 7’) was early adopted, as permitted by the standard, by the
Banking Group on 1 October 2019. These amendments allow the Banking Group to apply certain exceptions to the standard hedging requirements in
respect of hedge relationships that are impacted by a market wide interest rate benchmark reform. Specifically the exceptions allow the Banking
Group to:
 Assume that the interest rate benchmark on which the hedged cash flows are based is not altered as a result of the reform when determining
whether a forecast transaction is highly probable;
 Assume that the interest rate benchmark of the hedged item/instrument is not altered for the life of the hedge when assessing whether a hedge is
expected to continue to be highly effective;
 A hedge relationship impacted by uncertainty arising from benchmark interest rate reform is not required to pass the 80%-125% effectiveness test,
however any actual ineffectiveness must be recorded in the income statement; and
 The determination of a designated component of an exposure in portfolio hedges is only required to be made the first time that component is
designated, and not when the portfolio is de-designated and re-designated.
The exceptions allowed by the amendments are being applied to the Banking Group’s London Interbank Offered Rate (‘LIBOR’) linked hedge
relationships that mature after the LIBOR discontinuance date of 31 December 2021. The Banking Group’s LIBOR transition project has commenced
focusing on identification of exposures and internal processes that will be affected by the changes.
A key assumption made when performing hedge accounting at the reporting date is that both the hedged item and instrument will be amended
from existing LIBOR linked floating rates to new alternative reference rates (‘ARRs’) on the same date. Where actual differences between those
dates arise hedge ineffectiveness will be recorded in the income statement.
On 9 April 2020, the IASB issued an exposure draft for Interest Rate Benchmark Reform – Phase 2 which considers the issues that will affect financial
reporting when an existing benchmark interest rate is replaced by an ARR. The Banking Group continues to monitor these developments and the
expected impact.
The table below summarises the LIBOR exposures the Banking Group currently has in hedging relationships maturing after 31 December 2021 which
will be impacted by the Interest Rate Benchmark Reform and the quantum of those risks. The extent of the risk exposure also reflects the notional
amounts of related hedging instruments.
THE BANKING GROUP
31 Mar 20
Unaudited
$ millionsNotional hedged exposure
Benchmark
USD LIBOR 100

Notes to the financial statements
12 Westpac New Zealand Limited
Note 2 Net interest income5967-2 04-18
THE BANKING GROUP
Six MonthsSix Months
EndedEnded
31 Mar 2031 Mar 19
$ millions
UnauditedUnaudited
Interest income
Calculated using the effective interest rate method
Cash and balances with central banks 7 12
Collateral paid 1 3
Investment securities 58 78
Loans 1,793 1,933
Due from related entities 1 2
Total interest income calculated using the effective interest rate method 1,860 2,028
Other
Trading securities and financial assets measured at FVIS 13 14
Due from related entities 6 1
Total other 19 15
Total interest income 1,879 2,043
Interest expense
Calculated using the effective interest rate method
Collateral received 2 3
Deposits and other borrowings 532 660
Debt issues 135 141
Due to related entities 11 20
Loan capital 59 71
Other interest expense 7 2
Total interest expense calculated using the effective interest rate method 746 897
Other
Deposits and other borrowings 8 11
Debt issues 24 4
Due to related entities - 1
Other interest expense
1
145 147
Total other 177 163
Total interest expense 923 1,060
Net interest income 956 983
1
Includes the net impact of the Banking Group’s interest rate and liquidity management activities.

Notes to the financial statements
Westpac New Zealand Limited 13
Note 3 Non-interest income5967-2 04-18
THE BANKING GROUP
Six MonthsSix Months
EndedEnded
31 Mar 2031 Mar 19
$ millions
UnauditedUnaudited
Net fees and commissions income
Facility fees 30 25
Transaction fees and commissions 115 136
Other non-risk fee income 11 12
Fees and commissions income 156 173
Credit card loyalty programs (19) (16)
Transaction fees and commissions related expenses (15) (14)
Fees and commissions expenses (34) (30)
Net fees and commissions income 122 143
Other income
Net ineffectiveness on qualifying hedges 14 -
Other non-interest income 1 45
Total other income 15 45
Total non-interest income 137 188
Non-interest income in scope of NZ IFRS 15 Revenue from Contracts with Customers (‘NZ IFRS 15’) can be further disaggregated into the following
operating segments and is consistent with the segment descriptions detailed in Note 12:
THE BANKING GROUP
$ millions
Consumer
Banking and
Wealth
Commercial,
Corporate and
Institutional
Investments and
Insurance
Reconciling
ItemsTotal
Six months ended 31 March 2020 (Unaudited)
Fees and commissions income
Facility fees 20 8 - 2 30
Transaction fees and commissions 73 43 - (1) 115
Other non-risk fee income 6 6 - (1) 11
Fees and commissions income 99 57 - - 156
Fees and commissions expenses (34) - - - (34)
Net fees and commissions income 65 57 - - 122
Six months ended 31 March 2019 (Unaudited) (restated)
Fees and commissions income
Facility fees 14 7 - 4 25
Transaction fees and commissions 91 51 - (6) 136
Other non-risk fee income 7 7 - (2) 12
Fees and commissions income 112 65 - (4) 173
Fees and commissions expenses (30) - - - (30)
Net fees and commissions income 82 65 - (4) 143

Notes to the financial statements
14 Westpac New Zealand Limited
Note 4 Impairment charges/(benefits)
THE BANKING GROUP
Six MonthsSix Months
Ended Ended
31 Mar 2031 Mar 19
$ millions
UnauditedUnaudited
Provisions raised/(released):
Performing 133 (8)
Non-performing 68 14
Bad debts written-off/(recovered) directly to the income statement 9 8
Impairment charges/(benefits) 210 14
of which relates to:
Loans and credit commitments 210 14
Impairment charges/(benefits) 210 14
Impairment charges/(benefits) on all other financial assets are not material to the Banking Group. Refer to Note 6 for details on the impact of
COVID-19 on the provision for ECL.
Note 5 Loans
THE BANKING GROUP
31 Mar 2030 Sep 19
$ millions
UnauditedAudited
Residential mortgages 53,393 51,487
Other retail 3,503 3,753
Corporate 30,449 29,124
Other
159 111
Total gross loans 87,504 84,475
Provisions for ECL on loans (Note 6) (499) (315)
Total net loans 87,005 84,160
As at 31 March 2020, $7,531 million of housing loans, accrued interest (representing accrued interest on the outstanding housing loans) and cash
(representing collections of principal and interest from the underlying housing loans) were used by the Banking Group to secure the obligations of
Westpac Securities NZ Limited (‘WSNZL’) under the Bank’s Global Covered Bond Programme (‘CB Programme’) (30 September 2019: $7,530
million). These pledged assets were not derecognised from the Banking Group’s balance sheet in accordance with the accounting policies
outlined in Note 1 to the financial statements included in the Disclosure Statement for the year ended 30 September 2019. As at 31 March 2020,
the New Zealand dollar equivalent of bonds issued by WSNZL under the CB Programme was $5,502 million (30 September 2019: $5,274 million).

Notes to the financial statements
Westpac New Zealand Limited 15
Note 6 Provisions for expected credit losses
Loans and credit commitments
The reconciliation of the provision for ECL for loans and credit commitments as at 31 March 2020 below has been determined by an aggregation of
monthly movements over the period. The key line items in the reconciliation represent the following:
The transfers between stages lines represent transfers between stage 1, stage 2 and stage 3 prior to remeasurement of the provision for ECL.
The other charges/(credits) to the income statement line represents the impact on the provision for ECL due to changes in credit quality
during the period (including transfers between stages), changes due to forward looking economic scenarios, the COVID-19 overlay, and
partial repayments and additional drawdowns on existing facilities over the period.
Write-offs represent a reduction in the provision for ECL as a result of derecognition of exposures where there is no reasonable expectation
of full recovery.
Movements in components of loss allowances
The following table shows the collectively assessed provisions (‘CAP’) and individually assessed provisions (‘IAP’) for loans and credit commitments.
THE BANKING GROUP
31 Mar 20
Unaudited
PerformingNon-performing
Stage 1Stage 2Stage 3Stage 3
$ millions
CAPCAPCAPIAP
Total
Provision for ECL as at 1 October 2019 91 180 53 28 352
Due to changes in credit quality:
Transfers to Stage 1 117 (110) (7) - -
Transfers to Stage 2 (16) 33 (14) (3) -
Transfers to Stage 3 CAP - (22) 23 (1) -
Transfers to Stage 3 IAP - (19) (1) 20 -
Reversals of previously recognised impairment charges - - - (7) (7)
New financial assets originated 9 - - - 9
Financial assets derecognised during the period (7) (14) (9) - (30)
Changes in CAP due to amounts written off - - (21) - (21)
Other charges/(credits) to the income statement (79) 241 56 32 250
Total charges/(credits) to the income statement for ECL 24 109 27 41 201
Amounts written off from IAP - - - (1) (1)
Total provision for ECL on loans and credit commitments as
at 31 March 2020
115 289 80 68 552
Presented as:
Provision for ECL on loans (refer to Note 5) 96 255 80 68 499
Provision for ECL on credit commitments 19 34 - - 53
Total provision for ECL on loans and credit commitments as
at 31 March 2020
115 289 80 68 552

Notes to the financial statements
16 Westpac New Zealand Limited
Note 6 Provisions for expected credit losses (continued)
THE BANKING GROUP
30 Sep 19
Audited
PerformingNon-performing
Stage 1Stage 2Stage 3Stage 3
$ millions
CAPCAPCAPIAP
Total
Provision for ECL as at 1 October 2018 103 203 53 36 395
Due to changes in credit quality:
Transfers to Stage 1 261 (245) (16) - -
Transfers to Stage 2 (16) 43 (26) (1) -
Transfers to Stage 3 CAP - (38) 42 (4) -
Transfers to Stage 3 IAP - - (8) 8 -
Reversals of previously recognised impairment charges - - - (15) (15)
New financial assets originated 24 - - - 24
Financial assets derecognised during the year (19) (41) (21) - (81)
Changes in CAP due to amounts written off - - (53) - (53)
Other charges/(credits) to the income statement (262) 258 82 9 87
Total charges/(credits) to the income statement for ECL (12) (23) - (3) (38)
Amounts written off from IAP - - - (5) (5)
Total provision for ECL on loans and credit commitments as
at 30 September 2019
91 180 53 28 352
Presented as:
Provision for ECL on loans (refer to Note 5) 76 158 53 28 315
Provision for ECL on credit commitments 15 22 - - 37
Total provision for ECL on loans and credit commitments as
at 30 September 2019
91 180 53 28 352
Impacts of changes in gross financial assets on loss allowances
The following table explains how changes in gross carrying amounts of loans during the period have contributed to changes in the provisions for
ECL on loans.
It is important to note that as a result of the COVID-19 overlay (discussed in the ‘COVID-19 overlay’ section below), the gross carrying amount is
impacted by $5.0 billion of loans ($3.7 billion relating to the business portfolio and $1.3 billion relating to the retail portfolio) transferred from
stage 1 to stage 2 on the same basis as the overlays for determining a significant increase in credit risk (‘SICR’) were. As with determining the level
of overlays to reflect the provision for ECL associated with a SICR, there is equally a degree of uncertainty with the amount of loans reflected in
stage 2. In particular, while the provision for ECL as a proportion of gross carrying amount on stage 2 loans has decreased, these exposures
referred to in determining the COVID-19 overlay are still performing, and while some may experience a credit deterioration we do not expect that
all these exposures used to calculate the overlay will result in a loss. We expect that the treatment of these loans will continue to evolve as the
situation unfolds and more data is available to accurately model and understand the credit risk/loss implications from the COVID-19 pandemic.

Notes to the financial statements
Westpac New Zealand Limited 17
Note 6 Provisions for expected credit losses (continued)
THE BANKING GROUP
31 Mar 20
Unaudited
Performing Non-performing
Stage 1Stage 2Stage 3Stage 3
$ millions
CAPCAPCAPIAP
Total
Total gross carrying amount as at 1 October 2019 80,055 3,972 379 69 84,475
Transfers:
Transfers to Stage 1 2,167 (2,120) (47) - -
Transfers to Stage 2 (7,646) 7,729 (69) (14) -
Transfers to Stage 3 CAP (43) (225) 271 (3) -
Transfers to Stage 3 IAP - (76) (11) 87 -
Net further lending/(repayment) (1,176) 46 (11) (1) (1,142)
New financial assets originated 11,064 - - - 11,064
Financial assets derecognised during the period (6,529) (273) (66) (3) (6,871)
Amounts written-off - - (21) (1) (22)
Total gross carrying amount as at 31 March 2020 77,892 9,053 425 134 87,504
Provision for ECL as at 31 March 2020 (96) (255) (80) (68) (499)
Total net carrying amount as at 31 March 2020 77,796 8,798 345 66 87,005
THE BANKING GROUP
30 Sep 19
Audited
Performing Non-performing
Stage 1Stage 2Stage 3Stage 3
$ millions
CAPCAPCAPIAP
Total
Total gross carrying amount as at 1 October 2018 76,532 3,707 383 80 80,702
Transfers:
Transfers to Stage 1 4,202 (4,105) (92) (5) -
Transfers to Stage 2 (5,005) 5,123 (115) (3) -
Transfers to Stage 3 CAP (158) (346) 518 (14) -
Transfers to Stage 3 IAP (6) (2) (40) 48 -
Net further lending/(repayment) (2,456) 228 (75) (24) (2,327)
New financial assets originated 17,693 - - - 17,693
Financial assets derecognised during the year (10,747) (633) (147) (8) (11,535)
Amounts written-off - - (53) (5) (58)
Total gross carrying amount as at 30 September 2019 80,055 3,972 379 69 84,475
Provision for ECL as at 30 September 2019 (76) (158) (53) (28) (315)
Total net carrying amount as at 30 September 2019 79,979 3,814 326 41 84,160
Impact of COVID-19 on the provision for ECL for the six months ended 31 March 2020
COVID-19 has had a significant impact on global and domestic economies and, as such, many of the Banking Group’s customers. The current and
prospective rapid deterioration in the economy due to COVID-19 has resulted in a material increase in the provision for ECL.
The following table attributes the other charges/(credits) to the income statement of the movements in components of loss allowances for the
period.

Notes to the financial statements
18 Westpac New Zealand Limited
Note 6 Provisions for expected credit losses (continued)
THE BANKING GROUP
31 Mar 20
$ millionsUnaudited
Modelled provision for ECL using updated economic inputs / weightings 97
COVID-19 overlay 49
Impact of COVID-19 on the provision for ECL as at 31 March 2020 146
Other net movements 104
Total other charges/(credits) to the income statement for the six months ended 31 March 2020 250
Details of these changes, which are based on reasonable and supportable information up to the date of this disclosure statement are provided
below.
Modelled provision for ECL
The modelled provision for ECL is a probability weighted estimate based on three scenarios which together are representative of the Banking
Group’s view of the forward-looking distribution of potential loss outcomes. The increase in provisions as a result of changes in modelled ECL are
reflected through the “Other charges/(credits) to the income statement” line in the “Movements in components of loss allowances” table. Of the
$250 million total other charges/(credits) to the income statement, $97 million relates to updates made to the modelling inputs to address the
COVID-19 impacts on the Banking Group’s customers. “Other net movements” includes changes in modelling inputs and portfolio changes not
related to COVID-19 including migration from stage 2 (performing) to stage 3 (non-performing).
The base case scenario uses current Banking Group economic forecasts and reflects the latest available macroeconomic view which shows a
deterioration in the short-term, with a subsequent recovery. This view considers both the economic and societal impacts of COVID-19 as well as
the government stimulus measures implemented to cushion the impacts. The Banking Group’s economic forecast assumes the following:
 a short-term contraction with annual GDP growth to decline to -13.7% in June 2020 quarter, improving to a contraction of -3.5% in the December
2020 quarter, and a recovery to positive growth over 2021 (all figures based on growth over the same quarter of the previous year);
 a decline of 5% in residential property prices in the year to December 2020, with a further fall of 6% by the end of the March quarter in 2021.
Prices are expected to be rising again later in 2021.
The downside scenario is a more severe scenario with ECL higher than those under the current base case scenario. The more severe loss outcome
for the downside is generated under a recession scenario in which the combination of negative GDP growth, declines in residential property prices
and an increase in the unemployment rate simultaneously impact ECL across all portfolios from the reporting date. The upside scenario
represents a modest improvement to the base case.
The following sensitivity table shows the reported provision for ECL based on the probability weighted scenarios and what the provisions for ECL
would be assuming a 100% weighting is applied to the base case scenario and to the downside scenario (with all other assumptions, including
customer risk grades, held constant).
THE BANKING GROUP
31 Mar 20
$ millionsUnaudited
Reported probability-weighted ECL 552
100% base case ECL 424
100% downside ECL 748
The following table indicates the weightings applied by the Banking Group as at 31 March 2020 and 30 September 2019.
31 Mar 2030 Sep 19
Macroeconomic scenario weightings (%)UnauditedAudited
Upside510
Base5562.5
Downside4027.5

Notes to the financial statements
Westpac New Zealand Limited 19
Note 6 Provisions for expected credit losses (continued)
The increase in weighting to the downside scenario since 30 September 2019 reflects the significant risk regarding the economic assumptions
used in the base case. In particular, the current base case economic forecast indicates a relatively short and sharp economic impact followed by a
subsequent recovery. There is a risk that the economic impacts of COVID-19 could be deeper or more prolonged, leading to higher credit losses
than those modelled under the base case.
The COVID-19 pandemic is leading to material structural shifts in the behaviour of the economy and customers, and unprecedented actions by
banks, governments and regulators in response. ECL models are expected to be subject to a higher than usual level of uncertainty during this
period. In this environment, there is a heightened need for the application of judgement in order to reflect these evolving relationships and risks.
COVID-19 overlay
While the impacts on the broad economy are included in the assumptions used in the economic scenarios and the weightings applied to these
scenarios, these general economy wide impacts will not reflect the specific impact on individual customers. As the full impacts of the COVID-19
pandemic were yet to be felt at the balance date, the Banking Group is yet to see the anticipated increase in delinquencies, downgrades and
defaults. As these expected future downgrades are not currently captured in the modelled outcome, the Banking Group has specifically
considered the likely industry specific and retail customer impacts and raised a $49 million overlay in addition to the modelled provision.
The COVID-19 overlay reflects that the ECL model does not yet fully capture loans and credit commitments for which there has been a SICR as a
result of COVID-19, as we have not yet observed any significant impact to customer credit ratings. We expect that the treatment of these loans
and credit commitments will evolve as the situation unfolds and more data is available to model or understand the credit risk/loss implications
from the COVID-19 pandemic and the mitigating impact of government stimulus packages. Over time we expect the overlay to reduce as the
impact will be better reflected in the modelled outcome.
We note that while deferral of payments by customers in hardship arrangements is generally treated as an indication of a SICR, the deferral of
payments under the current COVID-19 support packages for mortgages and business loans has not, in isolation, been treated as an indication of a
SICR. These packages are available to customers who have had income losses as a result of COVID-19, who otherwise had up to date payment
status prior to the onset of COVID-19, and have been designed to provide short-term cash flow support while the most significant COVID-19
restrictions are in place. As these are expected to be short-term in nature, there is an expectation that most customers making use of the
arrangements will subsequently return to normal trading or employment arrangements. Accordingly, at this stage, we do not consider that
customers making use of the packages have necessarily experienced a SICR as this assessment is based on changes in lifetime probability of
default. This is consistent with the ‘IFRS 9 and COVID-19’ guidance issued by the IASB on 27 March 2020.
We will reassess this treatment as the situation evolves and the longer-term impacts of the COVID-19 pandemic become clearer. Beyond the
specific COVID-19 support packages, it is likely that some customers will move into general hardship arrangements and will thus be treated as
having experienced a SICR.
As an alternative to treating all customers who are making use of the COVID-19 support packages as having experienced a SICR, we have
considered the likely impacts at a portfolio level and raised a provision for lifetime ECL for our business and retail segments where a SICR has likely
occurred as described below.
Business lending (including institutional)
Industry segments have been rated as high, medium or low risk based on judgement as to the likely economic impact of COVID-19 on that
industry. We have assessed that the most severely impacted customers are those in industries impacted by social distancing, travel, supply chain
disruption and industries adjacent to these. The high impacted industries include transport, manufacturing, retail trade, entertainment and
hospitality, travel, tourism, food and beverage. The most significant second order impacts are on commercial real estate and construction.
In determining which exposures in high and medium rated industries should be included in determining the ECL overlay, we have considered
factors such as whether exposures are investment or non-investment risk grade, potential to raise capital or attract additional funding and
capacity to take other measures to support their businesses. We considered the increase in provisions that would arise if we were to increase the
modelled provisions for these customers to the expected lifetime ECL (stage 2) in significantly stressed macroeconomic conditions using current
customer risk grades. For the medium rated industries, a similar comparison was performed to consider the increase in a 12-month ECL (stage 1)
in moderately stressed macroeconomic conditions. We then applied judgement to estimate the necessary increase in provisions.
Based on this judgement, we have identified $9 billion of high rated business portfolio loans and credit commitments on which a lifetime ECL
overlay has been determined. This has resulted in a $7 million overlay for high rated industries which is included in stage 2 provisions. A $16 million
overlay for medium rated industries is included in stage 1 and stage 2 provisions.
The judgements and assumptions used in estimating the overlays will be reviewed and refined as the COVID-19 pandemic evolves. We expect the
overlay to be reduced as we observe customer risk grade migration through the portfolio.

Notes to the financial statements
20 Westpac New Zealand Limited
Note 6 Provisions for expected credit losses (continued)
Retail lending
The forecast structural increase in long-term unemployment rates is expected to result in longer term increases in stage 2 balances and losses. A
portfolio level increase in the stage 2 population of 2.5% for New Zealand retail (representing the expected medium-term increase in
unemployment) is used to derive this overlay. This approach assumes that the Banking Group’s customer base is representative of the wider
community. It reflects that, whilst individual customer impacts are not yet evident in customer credit performance, there has been a SICR for a
proportion of the portfolio.
We have identified $1.5 billion of retail exposures on which a lifetime ECL overlay has been determined. This has resulted in a $26 million overlay
which is included in stage 2 provisions.
Note 7 Deposits and other borrowings-2 04-18
THE BANKING GROUP
31 Mar 2030 Sep 19
$ millionsUnauditedAudited
Certificates of deposit 3,543 1,142
Non-interest bearing, repayable at call 9,778 6,871
Other interest bearing:
At call 26,505 24,053
Term 32,768
33,540
Total deposits and other borrowings 72,594 65,606
Deposits and other borrowings have been recognised under both the historical cost convention and by applying fair value accounting to certain
products. Refer to Note 10 for further details.
Note 8 Debt issues
THE BANKING GROUP
31 Mar 2030 Sep 19
$ millionsUnauditedAudited
Short-term debt
Commercial paper 3,052 2,312
Total short-term debt 3,052 2,312
Long-term debt
Non-domestic medium-term notes 7,558 7,343
Covered bonds 5,490 5,263
Domestic medium-term notes 3,426 2,928
Total long-term debt 16,474 15,534
Total debt issues 19,526 17,846
Debt issues have been recognised under both the historical cost convention and by applying fair value accounting to certain products. Refer to
Note 10 for further details.
Note 9 Related entities
Controlled entities of the Bank are set out in Note 22 to the financial statements included in the Disclosure Statement for the year ended 30 September
2019.
The Banking Group entered into reverse repurchase agreements with the New Zealand Branch of the Ultimate Parent Bank which amounted to
$2,264 million as at 31 March 2020 (30 September 2019: $872 million).
On 13 February 2020, the Bank declared and paid a dividend of $325 million to its immediate parent company, Westpac New Zealand Group Limited
(‘WNZGL’).

Notes to the financial statements
Westpac New Zealand Limited 21
Note 10 Fair values of financial assets and financial liabilities
Fair Valuation Control Framework
The Banking Group uses a Fair Valuation Control Framework where the fair value is either determined or validated by a function independent of the
transaction. This framework formalises the policies and procedures used to achieve compliance with relevant accounting, industry and regulatory
standards. The framework includes specific controls relating to:
– the revaluation of financial instruments;
– independent price verification;
– fair value adjustments; and
– financial reporting.
A key element of the framework is the Revaluation Committee, comprising senior valuation specialists from within the Ultimate Parent Bank Group.
The Revaluation Committee reviews the application of the agreed policies and procedures to assess that a fair value measurement basis has been
applied.
The method of determining fair value differs depending on the information available.
Fair value hierarchy
A financial instrument’s categorisation within the valuation hierarchy is based on the lowest level input that is significant to the fair value
measurement.
The Banking Group categorises all fair value instruments according to the hierarchy described as follows.
Valuation techniques
The Banking Group applies market accepted valuation techniques in determining the fair valuation of over-the-counter derivatives. This includes
credit valuation adjustments and funding valuation adjustments, which incorporate credit risk and funding costs and benefits that arise in relation to
uncollateralised derivative positions, respectively.
The specific valuation techniques, the observability of the inputs used in valuation models and the subsequent classification for each significant
product category are outlined as follows:
Financial instruments measured at fair value
Level 1 instruments
The fair value of financial instruments traded in active markets is based on recent unadjusted quoted prices. These prices are based on actual arm’s
length basis transactions.
The valuations of Level 1 instruments require little or no management judgement.
InstrumentBalance sheet categoryIncludes:Valuation technique
Non-asset
backed debt
instruments
Trading securities and
financial assets measured at
FVIS
Investment securities
New Zealand
Government bonds
These instruments are traded in liquid, active markets where
prices are readily observable. No modelling or assumptions are
used in the valuation.
Level 2 instruments
The fair value for financial instruments that are not actively traded is determined using valuation techniques which maximise the use of observable
market prices. Valuation techniques include:
– the use of market standard discounting methodologies;
– option pricing models; and
– other valuation techniques widely used and accepted by market participants.

Notes to the financial statements
22 Westpac New Zealand Limited
Note 10 Fair values of financial assets and financial liabilities (continued)
InstrumentBalance sheet categoryIncludes:Valuation technique
Interest rate
products
Derivative financial instruments
Due from related entities
Due to related entities
Interest rate swaps,
forwards and options
– derivative financial
instruments
Industry standard valuation models are used to calculate the
expected future value of payments by product, which is
discounted back to a present value. The model’s interest rate
inputs are benchmark interest rates and active broker quoted
interest rates in the swap, bond and futures markets. Interest
rate volatilities are sourced from brokers and consensus data
providers. If consensus prices are not available, these are
classified as Level 3 instruments.
Foreign exchange
products
Derivative financial instruments
Due from related entities
Due to related entities
FX swaps – derivative
financial instruments
Derived from market observable inputs or consensus pricing
providers using industry standard models.
Non-asset backed
debt instruments
Trading securities and financial
assets measured at FVIS
Investment securities
Due from related entities
Due to related entities
Other financial liabilities
Local authority and
NZ public securities,
other bank issued
certificates of deposit,
commercial paper, other
government securities,
off-shore securities and
corporate bonds
Repurchase
agreements and reverse
repurchase agreements
over non-asset backed
debt securities
Valued using observable market prices which are sourced from
independent pricing services, broker quotes or inter-dealer
prices.
Deposits and
other borrowings
at fair value
Deposits and other borrowingsCertificates of deposit
Discounted cash flow using market rates offered for deposits of
similar remaining maturities.
Debt issues at fair
value
Debt issuesCommercial paper
Discounted cash flows, using a discount rate which reflects
the terms of the instrument and the timing of cash flows
adjusted for market observable changes in the Bank’s implied
credit worthiness.
Level 3 instruments
Financial instruments valued where at least one input that could have a significant effect on the instrument’s valuation is not based on observable
market data due to illiquidity or complexity of the product. These inputs are generally derived and extrapolated from other relevant market data and
calibrated against current market trends and historical transactions.
These valuations are calculated using a high degree of management judgement.

Notes to the financial statements
Westpac New Zealand Limited 23
Note 10 Fair values of financial assets and financial liabilities (continued)
The table below summarises the attribution of financial instruments measured at fair value to the fair value hierarchy:
THE BANKING GROUP
31 Mar 2030 Sep 19
UnauditedAudited
$ millions
Level 1Level 2Level 3TotalLevel 1Level 2Level 3Total
Financial assets measured at fair value on a recurring basis
Trading securities and financial assets measured at FVIS-3,405-3,405-1,661-1,661
Derivative financial instruments-1,136-1,136-616-616
Investment securities1,1022,676-3,7781,0493,420-4,469
Due from related entities-2,912-2,912-1,703-1,703
Total financial assets measured at fair value1,10210,129-11,2311,0497,400-8,449
Financial liabilities measured at fair value on a recurring basis
Deposits and other borrowings at fair value-3,543-3,543-1,142-1,142
Other financial liabilities-200-200----
Derivative financial instruments-202-202-257-257
Debt issues at fair value-3,052-3,052-2,312-2,312
Due to related entities-701-701-820-820
Total financial liabilities measured at fair value-7,698-7,698-4,531-4,531
Analysis of movements between fair value hierarchy levels
During the period, there were no material transfers between levels of the fair value hierarchy (30 September 2019: no material transfers between
levels).
Financial instruments not measured at fair value
The following table summarises the estimated fair value of the Banking Group’s financial instruments not measured at fair value:
THE BANKING GROUP
31 Mar 2030 Sep 19
UnauditedAudited
CarryingCarrying
$ millions
AmountFair ValueAmountFair Value
Financial assets not measured at fair value
Cash and balances with central banks 5,096 5,096 1,864 1,864
Collateral paid 150 150 168 168
Loans 87,005 87,327 84,160 84,412
Other financial assets 175 175 178 178
Due from related entities 1,607 1,607 868 868
Total financial assets not measured at fair value 94,033 94,355 87,238 87,490
Financial liabilities not measured at fair value
Collateral received 1,161 1,161 473 473
Deposits and other borrowings 69,051 69,121 64,464 64,538
Other financial liabilities 452 452 455 455
Debt issues
1
16,474 16,229 15,534 15,701
Due to related entities 1,202 1,202 881 881
Loan capital
1
2,556 2,402 2,609 2,703
Total financial liabilities not measured at fair value 90,896 90,567 84,416 84,751
1
The estimated fair value of debt issues and loan capital includes the impact of changes in the Banking Group's credit spreads since origination.
A detailed description of how fair value is derived for financial instruments not measured at fair value is disclosed in Note 24 of the financial statements
included in the Disclosure Statement for the year ended 30 September 2019.5967-2 04-18

Notes to the financial statements
24 Westpac New Zealand Limited
Note 11 Credit related commitments, contingent assets and contingent liabilities
THE BANKING GROUP
31 Mar 2030 Sep 19
$ millions
UnauditedAudited
Letters of credit and guarantees 794 828
Commitments to extend credit 26,592 25,858
Total undrawn credit commitments 27,386 26,686
Contingent assets
The credit commitments shown in the table above also constitute contingent assets. These commitments would be classified as loans on the balance
sheet on the contingent event occurring.
Contingent liabilities
The Banking Group has contingent liabilities in respect of actual and potential claims and proceedings. An assessment of the Banking Group’s likely
loss in respect of these matters has been made on a case-by-case basis and provision has been made in these financial statements where
appropriate.
Compliance, regulation and remediation
The Banking Group is subject to continued regulatory action and internal reviews relating to matters pertaining to the provision of services to our
customers. Contingent liabilities may exist in respect of actual or potential claims, compensation payments and/or refunds identified as part of
these reviews. An assessment of the Banking Group’s likely loss has been made on a case-by-case basis for the purpose of the financial statements
but cannot always be reliably estimated.
Note 12 Segment reporting
The Banking Group’s segment reporting incorporates consumer banking and wealth, commercial, corporate and institutional banking, and
investments and insurance sectors within New Zealand. On this basis, no geographical segment reporting is provided.
The operating segment results have been presented on a management reporting basis and consequently internal charges and transfer pricing
adjustments have been reflected in the performance of each operating segment. Intersegment pricing is determined on a cost recovery basis.
The Banking Group does not rely on any single major customer for its revenue base.
Segment comparative information for the six months ended 31 March 2019 has been restated to ensure consistent presentation with the current
reporting period. This includes adjustments for changes in the segmentation classification for small business customers and changes to expense
allocations and the Ultimate Parent Bank’s capital allocation framework.
Operating segments are defined by the customers they serve and the services they provide. The Banking Group has identified the following main
operating segments:
–Consumer Banking and Wealth provides financial services predominantly for individuals;
–Commercial, Corporate and Institutional Banking provides a broad range of financial services for commercial, corporate, property finance,
agricultural, institutional and government customers; and
–Investments and Insurance provides funds management and insurance services.
Reconciling items primarily represent:
–business units that do not meet the definition of operating segments under NZ IFRS 8 Operating Segments;
–elimination entries on consolidation of the results, assets and liabilities of the Banking Group’s controlled entities in the preparation of the
consolidated financial statements of the Banking Group;
–results of certain entities included for management reporting purposes including insurance and investments, but excluded from the consolidated
financial statements of the Banking Group for statutory financial reporting purposes; and
–results of certain business units excluded for management reporting purposes, but included within the consolidated financial statements of the
Banking Group for statutory financial reporting purposes.

Notes to the financial statements
Westpac New Zealand Limited 25
Note 12 Segment reporting (continued)
THE BANKING GROUP
ConsumerCommercial,Investments
Banking andCorporate andandReconciling
$ millionsWealth InstitutionalInsuranceItemsTotal
Six months ended 31 March 2020 (Unaudited)
Net interest income506456-(6)
956
Non-interest income
655755(40)137
Net operating income before operating expenses and
impairment charges
57151355(46)1,093
Operating expenses(394)(128)(18)15
(525)
Impairment (charges)/benefits
(101)(109)--(210)
Profit before income tax7627637(31)358
Six months ended 31 March 2019 (Unaudited) (restated)
Net interest income528444-11
983
Non-interest income
826563(22)188
Net operating income before operating expenses and
impairment charges
61050963(11)1,171
Operating expenses(351)(114)(13)10(468)
Impairment (charges)/benefits
(20)5-1(14)
Profit before income tax23940050-689
As at 31 March 2020 (Unaudited)
Total gross loans47,31540,027-16287,504
Total deposits and other borrowings36,45332,598-3,54372,594
As at 30 September 2019 (Audited)
Total gross loans45,73038,624-12184,475
Total deposits and other borrowings35,12529,340-1,14165,606
Note 13 Subsequent events
On 2 April 2020, a decision was made by the Reserve Bank of New Zealand (‘Reserve Bank’) to freeze the distribution of dividends on ordinary
shares by all locally incorporated banks in New Zealand (including the Bank) during the period of economic uncertainty caused by COVID-19.

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26 Westpac New Zealand Limited
This section contains the additional disclosures required by the Registered Bank Disclosure Statements (New Zealand Incorporated Registered
Banks) Order 2014 (as amended).
i. General information
Limits on material financial support by the Ultimate Parent Bank
On 19 November 2015, the Australian Prudential Regulation Authority (‘APRA’) informed the Ultimate Parent Bank that its Extended Licensed
Entity (‘ELE’) non-equity exposures to New Zealand banking subsidiaries is to transition to be below a limit of 5% of the Ultimate Parent Bank’s
Level 1 Tier 1 capital, as part of an initiative to reduce Australian bank non-equity exposure to their respective New Zealand banking subsidiaries and
branches.
The ELE consists of the Ultimate Parent Bank and its subsidiary entities that have been approved by APRA to be included in the ELE for the purposes
of measuring capital adequacy.
APRA has allowed a period of five years commencing on 1 January 2016 to transition to be less than the 5% limit. Exposures for the purposes of this
limit include all committed, non-intraday, non-equity exposures including derivatives and off-balance sheet exposures. For the purposes of
assessing this exposure, the 5% limit excludes equity investments and holdings of capital instruments in New Zealand banking subsidiaries. As at 31
March 2020, the ELE’s non-equity exposures to New Zealand banking subsidiaries affected by the limit were below 5% of Level 1 Tier 1 capital of the
Ultimate Parent Bank.
APRA has also confirmed the terms on which the Ultimate Parent Bank ‘may provide contingent funding support to a New Zealand banking
subsidiary during times of financial stress’. APRA has confirmed that, at this time, only covered bonds meet its criteria for contingent funding
arrangements.
Guarantee arrangements
No material obligations of the Bank are guaranteed as at the date the Directors signed this Disclosure Statement.
WNZGL does not guarantee any of the obligations of the Bank or any member of the Banking Group.
Changes in the Bank’s Board of Directors
Christopher John David Moller ceased to be a director effective 1 December 2019. Peter Francis King ceased to be a director effective 9 December
2019. There have been no other changes in the composition of the Board of Directors of the Bank (the ‘Board’) since 30 September 2019.
Auditor
PricewaterhouseCoopers
PricewaterhouseCoopers Tower
188 Quay Street
Auckland, New Zealand
Pending proceedings or arbitration
A description of any pending legal proceedings or arbitration concerning any member of the Banking Group, whether in New Zealand or otherwise,
that may have a material adverse effect on the Bank or the Banking Group is included in Note 11 Credit related commitments, contingent assets and
contingent liabilities.
Credit ratings
The Bank has the following credit ratings with respect to its long-term senior unsecured obligations, including obligations payable in New Zealand in
New Zealand dollars, as at the date the Directors signed this Disclosure Statement:
Rating AgencyCurrent Credit RatingRating Outlook
Fitch Ratings
Moody’s Investors Service
S&P Global Ratings
A+
A1
AA-
Negative
Stable
Negative

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Westpac New Zealand Limited 27
i. General information (continued)
On 7th April 2020, following an assessment of the economic impact of the COVID-19 pandemic on the Australian and New Zealand economies, Fitch
Ratings (Fitch) have downgraded their long-term ratings for the major Australian banks (including for the Ultimate Parent Bank) by one notch, to A+
(from AA-). Fitch has maintained the rating outlook for the Ultimate Parent Bank as “negative”, reflecting the major downside risk to Fitch’s
economic outlook in light of the evolving global situation.
On 8th April 2020, S&P Global Ratings affirmed the Bank’s current issuer credit rating of AA- long term and A-1+ short term but revised the outlook
to “negative”, in line with its outlook for the Ultimate Parent Bank. The change in outlook follows S&P Global Ratings’ decision to affirm Australia’s
AAA/A-1+ ratings but revise the outlook on these ratings to “negative”.
Other material matters
Financial Services Conduct and Culture Review
Following the developments and findings of the Financial Services Conduct and Culture Review and the Australian Royal Commission, the Financial
Markets (Conduct of Institutions) Amendment Bill was introduced to Parliament on 11 December 2019. The Bill introduces a conduct licensing regime
for banks, insurers and non-bank deposit takers and their intermediaries in respect of their conduct in relation to retail customers. The regime will
require licensed institutions to comply with a fair conduct principle to treat consumers fairly, and establish, implement and maintain an effective fair
conduct programme. It will also require institutions to comply with regulations that regulate incentives (including a prohibition on volume and value
sales targets). The Bill is currently before the Select Committee.
In addition to those matters identified above, the Banking Group remains subject to continued regulatory engagement in the nature of ongoing
investigations and reviews which may result in further regulatory change or requirements for customer remediation. The Banking Group continues to
identify and remediate conduct issues and risks as they arise.
Reserve Bank Capital Review
On 5 December 2019, the Reserve Bank announced changes to the capital adequacy framework in New Zealand. The new framework includes the
following key components:
Setting a Tier 1 capital requirement of 16% of risk weighted assets (‘RWA’) for systemically important banks (including the Bank) and 14% for all
other banks;
Additional Tier 1 capital (‘AT1’) can comprise no more than 2.5% of the 16% Tier 1 capital requirement;
Eligible Tier 1 capital will comprise common equity and redeemable perpetual preference shares. Existing AT1 instruments will be phased out
over a seven year period;
Maintaining the existing Tier 2 capital requirement of 2% of RWA; and
Recalibrating RWA for internal rating based banks, such as the Bank, such that aggregate RWA will increase to 90% of standardised RWA.
The Bank is already strongly capitalised with a Tier 1 capital ratio of 14.1% at 31 March 2020 based on the current Reserve Bank rules. On a pro forma
basis, (including the new RWA and capital requirements) at 31 March 2020 and assuming a Tier 1 capital ratio of 16-17%, the Bank would require a
further NZ$2.1-$2.7 billion of Tier 1 capital to meet the new requirements that are fully effective in 2028.
In response to the impacts of COVID-19, and to support credit availability, the Reserve Bank has delayed the start date of the new capital regime by
12 months to 1 July 2021 and the Reserve Bank will consider further delays in 2021 if it considers that market conditions warrant it. Banks will be given
up to seven years to comply.
AUSTRAC proceedings issued against the Ultimate Parent Bank
On 20 November 2019 the Ultimate Parent Bank received a statement of claim from AUSTRAC (the Australian money-laundering regulator)
commencing civil proceedings in relation to alleged contraventions of the Ultimate Parent Bank’s obligations under Australia’s Anti-Money
Laundering and Counter-Terrorism Financing Act 2006 (Cth). The proceedings relate to the alleged failure to report a large number of international
fund transfer instructions (‘IFTIs’), alleged failings in relation to record keeping and the passing on of certain data required in IFTIs, failure to comply
with correspondent banking obligations, AML/CTF Program failures and contraventions of the Ultimate Parent Bank’s ongoing customer due
diligence obligations. The matter is now before the Federal Court of Australia.
APRA and the Australian Securities and Investments Commission (‘ASIC’) have also separately commenced investigations into matters related to the
AUSTRAC allegations, including possible breaches of the Banking Act 1959 (Cth) and APRA prudential standards by the Ultimate Parent Bank.
The Ultimate Parent Bank has also been served with a shareholder class action in Australia relating to market disclosure issues connected to the
Ultimate Parent Bank’s monitoring of financial crime over the relevant period and matters which are the subject of the recent AUSTRAC proceedings.
The claim is brought on behalf of certain shareholders who acquired an interest in the Ultimate Parent Bank’s securities between 16 December 2013
and 19 November 2019.
On 31 January 2020, a US class action was filed against the Ultimate Parent Bank and its current and former CEO by Rosen Law Firm on behalf
of purchasers of the Ultimate Parent Bank’s securities between 11 November 2015 and 19 November 2019.

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28 Westpac New Zealand Limited
i. General information (continued)
The two respective class actions largely overlap in terms of subject matter and claims do not identify the amount of any damages sought, however,
given the time period in question in each of the relevant proceedings, and the nature of the claims it is likely that the damages from the applicants in
those proceedings will be significant. The Ultimate Parent Bank is defending these class actions.
Business Finance Guarantee Scheme
On 13 April 2020 the Bank entered into a deed of indemnity with the New Zealand Government to implement the New Zealand Government’s
business finance guarantee scheme (‘Scheme’). The terms of the Scheme are as follows:
The Scheme permits banks to lend up to $500,000 to qualifying borrowers for a maximum of three years. Various conditions apply including a
requirement for transparent interest rates and application of credit underwriting standards as modified to allow the Bank to give effect to the
Scheme.
Subject to compliance with the terms of the deed of indemnity, the New Zealand Government will pay 80% of any loss incurred by the Bank on
a loan it makes under the Scheme, after the Bank has exhausted its recoveries procedures, with the other 20% carried by the Bank.
Freeze on NZ Bank Dividends
On 2 April 2020, a decision was made by the Reserve Bank to freeze the distribution of dividends on ordinary shares by all locally incorporated banks
in New Zealand (including the Bank) during the period of economic uncertainty caused by COVID-19.
Reserve Bank steps to support liquidity and customer lending
On 16 March 2020 the Reserve Bank announced that it would provide term funding through a Term Auction Facility (‘TAF’) to give banks (including
the Bank) the ability to access term funding, with collateralised loans out to a term of twelve months, in order to alleviate pressures in funding
markets as a result of COVID-19. From 26 May 2020, for a period of 6 months, the Reserve Bank will make available a Term Lending Facility (‘TLF’), to
offer loans for a fixed term of three years at the rate of the Official Cash Rate, with access to the funds linked to banks’ lending under the Scheme. On
2 April 2020, the Reserve Bank reduced the core funding ratio for banks (including the Bank) from 75% to 50%.
ii. Additional financial disclosures
Additional information on balance sheet
THE BANKING GROUP
31 Mar 2030 Sep 19
$ millions
Unaudited Audited
Interest earning and discount bearing assets 103,284 94,076
Interest and discount bearing liabilities 87,611 80,586
Total amounts due from related entities 4,519 2,571
Total amounts due to related entities 4,459 4,310
Financial assets pledged as collateral
The Banking Group is required to provide collateral to other financial institutions, as part of standard terms, to secure liabilities. In addition to assets
supporting the CB Programme disclosed in Note 5, the carrying value of these financial assets pledged as collateral is:
THE BANKING GROUP
31 Mar 2030 Sep 19
$ millions
UnauditedAudited
Cash 150 168
Securities pledged under repurchase agreements:
Trading securities and financial assets measured at FVIS
1
160 9
Investment securities
1
- 1
Residential mortgage-backed securities
2
238 -
Total amount pledged to secure liabilities (excluding CB Programme) 548 178
1
Securities were pledged as collateral to the New Zealand Branch of the Ultimate Parent Bank which is recorded within due to related entities on the balance sheet.
2
During the six months ended 31 March 2020, the Banking Group has undertaken repurchase agreements with the Reserve Bank using residential mortgage-backed
securities. The repurchase cash amount at 31 March 2020 is $200 million with underlying securities to the value of $238 million provided under the arrangement.

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Westpac New Zealand Limited 29
ii. Additional financial disclosures (continued)
Additional information on concentrations of credit risk
THE BANKING GROUP
$ millions31 Mar 20
On-balance sheet credit exposures consists of
Cash and balances with central banks 5,096
Collateral paid 150
Trading securities and financial assets measured at FVIS 3,405
Derivative financial instruments 1,136
Investment securities 3,778
Loans 87,005
Other financial assets 175
Due from related entities 4,519
Total on-balance sheet credit exposures 105,264
Analysis of on-balance sheet credit exposures by industry sector
Accommodation, cafes and restaurants 508
Agriculture 8,884
Construction 572
Finance and insurance 7,577
Forestry and fishing 427
Government, administration and defence 9,006
Manufacturing 2,091
Mining 279
Property 7,996
Property services and business services 1,299
Services 2,173
Trade 2,044
Transport and storage 1,388
Utilities 1,809
Retail lending 55,139
Subtotal 101,192
Provisions for ECL (499)
Due from related entities 4,519
Other financial assets 52
Total on-balance sheet credit exposures 105,264
Off-balance sheet credit exposures consists of
Credit risk-related instruments 27,386
Total off-balance sheet credit exposures 27,386
Analysis of off-balance sheet credit exposures by industry sector
Accommodation, cafes and restaurants 149
Agriculture 804
Construction 494
Finance and insurance 1,680
Forestry and fishing 344
Government, administration and defence 865
Manufacturing 1,724
Mining 56
Property 1,972
Property services and business services 704
Services 665
Trade 1,771
Transport and storage 936
Utilities 1,528
Retail lending 13,694
Total off-balance sheet credit exposures 27,386
Australian and New Zealand Standard Industrial Classification ('ANZSIC') has been used as the basis for disclosing industry sectors.

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30 Westpac New Zealand Limited
ii. Additional financial disclosures (continued)
Additional information on concentrations of funding
THE BANKING GROUP
$ millions31 Mar 20
Funding consists of
Collateral received 1,161
Deposits and other borrowings 72,594
Other financial liabilities
1
300
Debt issues
2
19,526
Due to related entities
3
1,350
Loan capital 2,556
Total funding 97,487
Analysis of funding by geographical area
2
New Zealand 74,994
Australia 1,286
United Kingdom 8,878
United States of America 4,101
Other 8,228
Total funding 97,487
Analysis of funding by industry sector
Accommodation, cafes and restaurants 522
Agriculture 1,550
Construction 2,148
Finance and insurance 40,696
Forestry and fishing 217
Government, administration and defence 2,553
Manufacturing 2,226
Mining 70
Property services and business services 5,976
Services 4,393
Trade 1,771
Transport and storage 668
Utilities 697
Households 28,275
Other
4
4,375
Subtotal 96,137
Due to related entities
3
1,350
Total funding 97,487
1
Other financial liabilities, as presented above, are in respect of interbank placements.
2
The geographic region used for debt issues is based on the nature of the debt programmes. The nature of the debt programmes is used as a proxy for the location
of the original purchaser. Where the nature of the debt programmes does not necessarily represent an appropriate proxy, the debt issues are classified as 'Other’.
These instruments may have subsequently been on-sold.
3
Amounts due to related entities, as presented above, are in respect of deposits and borrowings and exclude amounts which relate to derivative financial
instruments and other liabilities.
4
Includes deposits from non-residents.
ANZSIC has been used as the basis for disclosing industry sectors.

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Westpac New Zealand Limited 31
ii. Additional financial disclosures (continued)
Additional information on interest rate sensitivity
The following table presents a breakdown of the earlier of the contractual repricing or maturity dates of the Banking Group’s net asset position as at 31
March 2020. The Banking Group uses this contractual repricing information as a base, which is then altered to take account of customer behaviour, to
manage its interest rate risk.
THE BANKING GROUP
31 Mar 20
Over 3Over 6Over 1
Months
and
Months
and
Year andNon-
Up to 3Up to 6Up toUp toOverinterest
$ millionsMonthsMonths1 Year2 Years2 YearsBearingTotal
Financial assets
Cash and balances with central banks4,746----3505,096
Collateral paid150-----150
Trading securities and financial assets measured at FVIS2,663493249---3,405
Derivative financial instruments-----1,1361,136
Investment securities1,180331806891,696-3,778
Loans45,2386,73914,74615,8364,797(351)87,005
Other financial assets-----175175
Due from related entities3,849----6704,519
Total financial assets57,8267,26515,17516,5256,4931,980105,264
Non-financial assets1,313
Total assets106,577
Financial liabilities
Collateral received1,161-----1,161
Deposits and other borrowings45,62310,2455,0651,2776069,77872,594
Other financial liabilities2200---450652
Derivative financial instruments-----202202
Debt issues7,7211,9055152,0617,324-19,526
Due to related entities 1,350----5531,903
Loan capital2,556-----2,556
Total financial liabilities58,41312,3505,5803,3387,93010,98398,594
Non-financial liabilities593
Total liabilities99,187
On-balance sheet interest rate repricing gap(587)(5,085)9,59513,187(1,437)
Net derivative notional principals
Net interest rate contracts (notional):
Receivable/(payable)12,575(711)(6,858)(8,815)3,809
Net interest rate repricing gap11,988(5,796)2,7374,3722,372

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32 Westpac New Zealand Limited
ii. Additional financial disclosures (continued)
Additional information on liquidity risk
Contractual maturity of financial liabilities
The table below presents cash flows associated with financial liabilities, payable at the balance sheet date, by remaining contractual maturity. The
amounts disclosed in the table are the future contractual undiscounted cash flows, whereas the Banking Group manages inherent liquidity risk based on
expected cash flows.
Cash flows associated with these financial liabilities include both principal payments, as well as fixed or variable interest payments incorporated into the
relevant coupon period. Principal payments reflect the earliest contractual maturity date. Derivative financial instruments designated for hedging
purposes are expected to be held for their remaining contractual lives, and reflect gross cash flows over the remaining contractual term.
Derivatives held for trading and certain liabilities classified in “Other financial liabilities” which are measured at FVIS are not managed for liquidity
purposes on the basis of their contractual maturity, and accordingly these liabilities are presented in either the on demand or up to 1 month columns.
Only the liabilities that the Banking Group manages based on their contractual maturity are presented on a contractual undiscounted basis in the table
below.
THE BANKING GROUP
31 Mar 20
OverOver
1 Month3 MonthsOver 1
Year
OnUp toand Up toand Up toand Up toOver
$ millions
Demand1 Month3 Months1 Year5 Years5 YearsTotal
Financial liabilities
Collateral received-1,161----1,161
Deposits and other borrowings32,9889,42813,08915,5961,975-73,076
Other financial liabilities996911200--379
Derivative financial instruments:
Held for hedging purposes (net settled)-171736942166
Held for hedging purposes (gross settled):
Cash outflow-4-560--564
Cash inflow---(525)--(525)
Debt issues-4031,2705,17812,81540620,072
Due to related entities:
Non-derivative balances1,05316195-53-1,362
Derivative financial instruments:
Held for trading 46-----46
Held for hedging purposes (net settled)-14651631483393
Held for hedging purposes (gross settled):
Cash outflow--111,203--1,214
Cash inflow--(9)(1,093)--(1,102)
Loan capital--9261362,6012,772
Total undiscounted financial liabilities34,18611,25714,55821,34415,2213,01299,578
Total contingent liabilities and commitments
Letters of credit and guarantees794-----794
Commitments to extend credit26,592-----26,592
Total undiscounted contingent liabilities and
commitments
27,386-----27,386

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Westpac New Zealand Limited 33
ii. Additional financial disclosures (continued)
Liquid assets
The table below shows the Banking Group’s holding of liquid assets and represents the key liquidity information provided to management. Liquid
assets include high quality assets readily convertible to cash to meet the Banking Group’s liquidity requirements. In management’s opinion,
liquidity is sufficient to meet the Banking Group’s present requirements.
THE BANKING GROUP
$ millions31 Mar 20
Cash and balances with central banks 5,096
Receivables due from the Ultimate Parent Bank 540
Supranational securities 1,198
NZ Government securities 3,758
NZ public securities 2,526
NZ corporate securities 1,804
Residential mortgage-backed securities 7,531
Total liquid assets 22,453
Reconciliation of mortgage-related amounts
The table below provides the Banking Group’s reconciliation between any amounts disclosed in this Disclosure Statement that relate to mortgages
on residential property.
THE BANKING GROUP
$ millions31 Mar 20
Residential mortgages - total gross loans (as disclosed in Note 5 and Section iii.) 53,393
Reconciling items:
Unamortised deferred fees and expenses (193)
Fair value hedge adjustments (162)
Value of undrawn commitments and other off-balance sheet amounts relating to residential mortgages 10,550
Undrawn at default
1
(2,681)
Residential mortgages by LVR (as disclosed in Additional mortgage information in Section iv.)
60,907
Accrued interest receivable 63
Partial write-offs 3
Residential mortgages - EAD (as disclosed in Credit risk exposures by asset class in Section iv.)
60,973
1
Estimate of the amount of committed exposure not expected to be drawn by the customer at the time of default.
iii. Asset quality
Past due assets
THE BANKING GROUP
31 Mar 20
Residential
$ millionsMortgagesOther RetailCorporateOtherTotal
Past due but not individually impaired assets
Less than 30 days past due1,105135218-1,458
At least 30 days but less than 60 days past due1712912-212
At least 60 days but less than 90 days past due87164-107
At least 90 days past due1323330-195
Total past due but not individually impaired assets1,495213264-1,972

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34 Westpac New Zealand Limited
iii. Asset quality (continued)
Movements in components of loss allowance
Refer to Note 6 for movements in components for loss allowance on loans and credit commitment for total exposures. The provisions for ECL on
loans and credit commitments can be further disaggregated into the following types of credit exposures:
THE BANKING GROUP
PerformingNon-performing
Stage 1Stage 2Stage 3Stage 3
$ millions
CAPCAPCAPIAP
Total
Residential mortgages
Provision for ECL as at 1 October 2019 22 19 31 6 78
Due to changes in credit quality:
Transfers to Stage 1 9 (6) (3) - -
Transfers to Stage 2 (1) 7 (6) - -
Transfers to Stage 3 CAP - (2) 3 (1) -
Transfers to Stage 3 IAP - - (1) 1 -
Reversals of previously recognised impairment charges - - - (3) (3)
New financial assets originated 2 - - - 2
Financial assets derecognised during the period (1) (1) (7) - (9)
Changes in CAP due to amounts written off - - - - -
Other charges/(credits) to the income statement 18 43 21 4 86
Total charges/(credits) to the income statement for ECL 27 41 7 1 76
Amounts written off from IAP - - - (1) (1)
Total provision for ECL as at 31 March 2020 49 60 38 6 153
Other retail
Provision for ECL as at 1 October 2019 46 55 19 - 120
Due to changes in credit quality:
Transfers to Stage 1 105 (101) (4) - -
Transfers to Stage 2 (5) 12 (7) - -
Transfers to Stage 3 CAP - (16) 16 - -
Transfers to Stage 3 IAP - - - - -
Reversals of previously recognised impairment charges - - - - -
New financial assets originated 4 - - - 4
Financial assets derecognised during the period (4) (10) (2) - (16)
Changes in CAP due to amounts written off - - (21) - (21)
Other charges/(credits) to the income statement (103) 140 28 2 67
Total charges/(credits) to the income statement for ECL (3) 25 10 2 34
Amounts written off from IAP - - - - -
Total provision for ECL as at 31 March 2020 43 80 29 2 154
Corporate
Provision for ECL as at 1 October 2019 23 106 3 22 154
Due to changes in credit quality:
Transfers to Stage 1 3 (3) - - -
Transfers to Stage 2 (10) 14 (1) (3) -
Transfers to Stage 3 CAP - (4) 4 - -
Transfers to Stage 3 IAP - (19) - 19 -
Reversals of previously recognised impairment charges - - - (4) (4)
New financial assets originated 3 - - - 3
Financial assets derecognised during the period (2) (3) - - (5)
Changes in CAP due to amounts written off - - - - -
Other charges/(credits) to the income statement 6 58 7 26 97
Total charges/(credits) to the income statement for ECL - 43 10 38 91
Amounts written off from IAP - - - - -
Total provision for ECL as at 31 March 2020 23 149 13 60 245
The above movements in components of loss allowance table does not include ‘Other’ credit exposures on the basis that the provision for ECL is
nil.

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Westpac New Zealand Limited 35
iii. Asset quality (continued)
Impacts of changes in gross financial assets on loss allowances
Refer to Note 6 for the impacts of changes in gross financial assets on the loss allowance for loans and credit commitments. The gross carrying
amounts of loans can be further disaggregated into the following types of credit exposures:
THE BANKING GROUP
PerformingNon-performing
Stage 1Stage 2Stage 3Stage 3
Total
$ millions
CAPCAPCAPIAP
Residential mortgages
Total gross carrying amount as at 1 October 2019 49,736 1,449 285 17 51,487
Transfers:
Transfers to Stage 1 842 (805) (37) - -
Transfers to Stage 2 (2,434) 2,485 (50) (1) -
Transfers to Stage 3 CAP (30) (154) 187 (3) -
Transfers to Stage 3 IAP - (1) (9) 10 -
Net further lending/(repayment) (928) (32) (6) (1) (967)
New financial assets originated 6,108 - - - 6,108
Financial assets derecognised during the period (3,056) (122) (53) (3) (3,234)
Amounts written-off - - - (1) (1)
Total gross carrying amount as at 31 March 2020 50,238 2,820 317 18 53,393
Provision for ECL as at 31 March 2020 (43) (58) (38) (6) (145)
Total net carrying amount as at 31 March 2020 50,195 2,762 279 12 53,248
Other retail
Total gross carrying amount as at 1 October 2019 3,510 190 51 2 3,753
Transfers:
Transfers to Stage 1 501 (492) (9) - -
Transfers to Stage 2 (570) 580 (10) - -
Transfers to Stage 3 CAP (10) (54) 64 - -
Transfers to Stage 3 IAP - - (2) 2 -
Net further lending/(repayment) (275) 29 - 1 (245)
New financial assets originated 400 - - - 400
Financial assets derecognised during the period (339) (32) (13) - (384)
Amounts written-off - - (21) - (21)
Total gross carrying amount as at 31 March 2020 3,217 221 60 5 3,503
Provision for ECL as at 31 March 2020 (34) (71) (29) (2) (136)
Total net carrying amount as at 31 March 2020 3,183 150 31 3 3,367
Corporate
Total gross carrying amount as at 1 October 2019 26,698 2,333 43 50 29,124
Transfers:
Transfers to Stage 1 824 (823) (1) - -
Transfers to Stage 2 (4,615) 4,637 (9) (13) -
Transfers to Stage 3 CAP (3) (17) 20 - -
Transfers to Stage 3 IAP - (75) - 75 -
Net further lending/(repayment) (25) 68 (5) (1) 37
New financial assets originated 4,338 - - - 4,338
Financial assets derecognised during the period (2,931) (119) - - (3,050)
Amounts written-off - - - - -
Total gross carrying amount as at 31 March 2020 24,286 6,004 48 111 30,449
Provision for ECL as at 31 March 2020 (19) (126) (13) (60) (218)
Total net carrying amount as at 31 March 2020 24,267 5,878 35 51 30,231
The above gross carrying amount table does not include 'Other' credit exposures (refer to Note 5) on the basis that the provision for ECL is nil.

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36 Westpac New Zealand Limited
iii.Asset quality (continued)
Other asset quality information
THE BANKING GROUP
31 Mar 20
Residential
$ millionsMortgagesOther RetailCorporateOtherTotal
Undrawn commitments with individually impaired counterparties--7-7
Other assets under administration-----
iv.Capital adequacy under the internal models based approach, and regulatory liquidity ratios
The information contained in this note has been derived in accordance with the Banking Group’s conditions of registration which relate to capital
adequacy and the Reserve Bank Capital Adequacy Framework (Internal Models Based Approach) (‘BS2B’), except for the matters of non-compliance
with condition of registration 1B disclosed on page 49. The Bank considers its internal credit model methodologies result in the retention of an
appropriate amount of capital to reflect its credit risk and any effect of the non-compliance with its condition of registration 1B on the information
relating to capital adequacy is not considered by the Bank to be material.
The Banking Group maintains an actively managed capital base to cover risks inherent in the business. The adequacy of the Banking Group’s capital
is monitored using, among other measures, the rules and ratios established by the Basel Committee on Banking Supervision (‘BCBS’) and adopted
by the Reserve Bank in supervising the Banking Group.
The Banking Group’s capital summary
THE BANKING GROUP
$ millions
31 Mar 20
Tier 1 capital
Common Equity Tier 1 capital
Paid-up ordinary shares issued by the Bank plus related share premium 7,300
Retained earnings (net of appropriations) 119
Accumulated other comprehensive income and other disclosed reserves
1
(29)
Less deductions from Common Equity Tier 1 capital
Goodwill (477)
Other intangible assets
2
(158)
Cash flow hedge reserve 18
Deferred tax asset deduction (217)
Expected loss excess over eligible allowance (62)
Total Common Equity Tier 1 capital 6,494
Additional Tier 1 capital
Additional Tier 1 capital instruments
3
1,500
Total additional Tier 1 capital 1,500
Total Tier 1 capital 7,994
Tier 2 capital
Tier 2 capital instruments
3
1,067
Revaluation reserves -
Eligible impairment allowance in excess of expected loss -
Total Tier 2 capital 1,067
Total capital 9,061
1
Accumulated other comprehensive income and other disclosed reserves consist of investment securities reserve and cash flow hedge reserve as disclosed as
reserves on the balance sheet.
2
Includes capitalised transaction costs on loan capital and debt issues.
3
Classified as a liability and excludes capitalised transaction costs. Additional Tier 1 capital instruments and Tier 2 capital instruments are itemised on pages 37 and
38. Further details on convertibility for Additional Tier 1 and Tier 2 capital instruments are noted under the ‘Conversion’ section.

Registered bank disclosures
Unaudited
Unaudited
Westpac New Zealand Limited 37
iv.Capital adequacy under the internal models based approach, and regulatory liquidity ratios (continued)
Capital structure
Ordinary shares
In accordance with BS2B, ordinary share capital is classified as Common Equity Tier 1 capital.
The ordinary shares have no par value. Subject to the constitution of the Bank, each ordinary share of the Bank carries the right to one vote on a poll
at meetings of shareholders, the right to an equal share in dividends authorised by the Board and the right to an equal share in the distribution of the
surplus assets of the Bank in the event of liquidation.
Additional Tier 1 loan capital
A summary of the key terms and features of the Additional Tier 1 loan capital (‘AT1 notes’) is provided below:
$Issue dateCounterpartyInterest rateOptional redemption date
NZ$1,500 million
notes
1
22 September 2017NZ Branch of the
Ultimate Parent Bank
NZ 90 day bank bill rate + 3.9594% p.a.21 September 2027 and every fifth
anniversary thereafter
1

The AT1 notes were issued by the Bank and rank equally amongst themselves and are subordinated to the claims of depositors and senior or less subordinated creditors
of the Bank.
Interest payable
Quarterly interest payments on the AT1 notes are at the absolute discretion of the Bank and will only be paid if the payment conditions are satisfied,
including that the interest payment will not result in the Bank becoming insolvent immediately following the interest payment; not result in a breach of
the Reserve Bank Prudential Standards; and the payment date not falling on the date of a capital trigger event or non-viability trigger event. Interest
payments are non-cumulative. If interest is not paid in full, the Bank may not determine or pay any dividends on its ordinary shares or undertake a
discretionary buy back or capital reduction of the Bank’s ordinary shares (except in limited circumstances).
Redemption
The Bank may elect to redeem all or some of the AT1 notes for their face value on 21 September 2027 and every fifth anniversary thereafter, subject to
the Reserve Bank’s prior written approval. Early redemption of all of the AT1 notes for certain tax or regulatory reasons is permitted subject to the
Reserve Bank’s prior written approval.
Conversion
If a capital trigger event or non-viability trigger event occurs, the Bank must convert some or all of the AT1 notes into a variable number of ordinary
shares issued by the Bank (calculated with reference to the net assets of the Bank and the total number of ordinary shares on issue at the conversion
date) that is sufficient, in the case of a capital trigger event, to return the Bank’s Common Equity Tier 1 capital ratio to above 5.125% as determined by
the Bank in consultation with the Reserve Bank; or, in the case of a non-viability trigger event, to satisfy the direction of the Reserve Bank or the
decision of the statutory manager of the Bank. A capital trigger event occurs when the Bank determines, or the Reserve Bank notifies in writing that it
believes, the Bank’s Common Equity Tier 1 Capital ratio is equal to or less than 5.125%. A non-viability trigger event occurs when the Reserve Bank or
the statutory manager (appointed pursuant to section 117 of the Reserve Bank Act) directs the Bank to convert or write off all or some of its AT1 notes.
If conversion of the AT1 notes does not occur within five business days of a capital trigger event or a non-viability trigger event, holders’ rights in
relation to the AT1 notes will be immediately and irrevocably terminated.
The Bank is able to elect to convert all the AT1 notes for certain tax or regulatory reasons (or in certain other circumstances).

Registered bank disclosures
Unaudited
Unaudited
38 Westpac New Zealand Limited
iv. Capital adequacy under the internal models based approach, and regulatory liquidity ratios (continued)
Tier 2 loan capital
A summary of the key terms and features of the Tier 2 loan capital (‘Tier 2 notes’) is provided below.
$Issue dateCounterpartyInterest rateMaturity DateOptional redemption date
AU$1,040 million
notes
1
8 September 2015London Branch of the
Ultimate Parent Bank
Australian 90 day bank
bill rate + 2.87% p.a.
22 March 202622 March 2021 and every interest
payment date thereafter
1
The Tier 2 notes were issued by the Bank and rank equally amongst themselves and are subordinated to the claims of depositors and senior or less subordinated creditors
of the Bank.
Interest payable
Interest payments on the Tier 2 notes are subject to the Bank being solvent at the time of, and immediately following the interest payment.
Early redemption
The Bank may elect to redeem all or some of the Tier 2 notes for their face value together with accrued interest (if any) on 22 March 2021 or any interest
payment date thereafter, subject to the Reserve Bank’s prior written approval. Early redemption of all of the Tier 2 notes for certain tax or regulatory
reasons is permitted on an interest payment date subject to the Reserve Bank’s prior written approval.
Conversion
If a non-viability trigger event occurs, the Bank must convert such number of the Tier 2 notes into a variable number of ordinary shares issued by the
Bank (calculated with reference to the net assets of the Bank and the total number of ordinary shares on issue on the conversion date) that is sufficient
to satisfy the direction of the Reserve Bank or the decision of the statutory manager. A non-viability trigger event occurs when the Reserve Bank or the
statutory manager (appointed pursuant to section 117 of the Reserve Bank Act) directs the Bank to convert or write off all or some of its Tier 2 notes. If
conversion of the Tier 2 notes fails to take effect within five business days, holders’ rights in relation to the Tier 2 notes will be immediately and
irrevocably terminated.
Reserves
Investment securities reserve
This comprises the changes in the fair value of debt securities measured at FVOCI (except for interest income, impairment charges and foreign
exchange gains and losses which are recognised in the income statement), net of any related hedge accounting adjustments and tax. These changes
are transferred to non-interest income in the income statement when the asset is disposed.
Cash flow hedge reserve
This comprises the fair value gains and losses associated with the effective portion of designated cash flow hedging instruments, net of tax.

Registered bank disclosures
Unaudited
Unaudited
Westpac New Zealand Limited 39
iv. Capital adequacy under the internal models based approach, and regulatory liquidity ratios (continued)
Credit risk subject to the Internal Rating Based (‘IRB’) approach
Credit risk exposures by asset class
The Banking Group’s credit risk exposures by asset class as at 31 March 2020
Exposure-Minimum
WeightedExposure-weightedRisk-Pillar 1
AverageweightedRiskweightedCapital
PDEADLGDWeightAssets
1
Requirement
Exposure-weighted PD Grade (%)%$ millions%%$ millions$ millions
Residential mortgages
Up to and including 0.10
------
Over 0.10 up to and including 0.50
0.4724,88315.0312.193,214257
Over 0.50 up to and including 1.0
0.7022,24821.4923.265,485439
Over 1.0 up to and including 2.5
1.5212,37122.4842.895,624450
Over 2.5 up to and including 10.0
3.951,13427.2098.781,18795
Over 10.0 up to and including 99.99
------
Default100.0033722.38134.2047938
Total1.3860,97319.1724.7415,9891,279
Other retail
Up to and including 0.10
0.0577146.656.87564
Over 0.10 up to and including 0.50
0.1986354.7521.3719416
Over 0.50 up to and including 1.0
0.5430656.1642.1613711
Over 1.0 up to and including 2.5
1.8881271.2988.6576361
Over 2.5 up to and including 10.0
5.6160672.02108.0169455
Over 10.0 up to and including 99.99
21.2714279.40162.7224620
Default100.003082.1221.4571
Total3.203,53061.1056.052,097168
Small business
Up to and including 0.10
0.101324.306.031-
Over 0.10 up to and including 0.50
0.351,05025.5614.6816313
Over 0.50 up to and including 1.0
0.9181231.0830.3326121
Over 1.0 up to and including 2.5
1.8345926.9634.0116513
Over 2.5 up to and including 10.0
4.6919730.0044.08927
Over 10.0 up to and including 99.99
15.613031.5961.41202
Default100.003933.95302.7312510
Total2.782,60028.0530.0282766
1
The value of the scalar used in determining the risk weighted assets is 1.06 as required by the conditions of registration.

Registered bank disclosures
Unaudited
Unaudited
40 Westpac New Zealand Limited
iv. Capital adequacy under the internal models based approach, and regulatory liquidity ratios (continued)
Exposure-Minimum
WeightedExposure-weightedRisk-Pillar 1
AverageweightedRiskweightedCapital
PDEADLGDWeightAssets
1
Requirement
Exposure-weighted PD Grade (%)%$ millions%%$ millions$ millions
Corporate/Business lending
Up to and including 0.04
0.034,42443.5518.6587570
Over 0.04 up to and including 0.10
0.074,57750.8228.111,364109
Over 0.10 up to and including 0.40
0.218,44345.5142.753,826306
Over 0.40 up to and including 3.0
1.3414,64134.0768.1810,580846
Over 3.0 up to and including 10.0
4.781,02536.30111.311,21097
Over 10.0 up to and including 99.0
23.501,24938.15190.712,524202
Default100.0018756.97326.1664652
Total2.1634,54640.6357.4221,0251,682
Sovereign
Up to and including 0.04
0.017,3528.341.321038
Over 0.04 up to and including 0.10
------
Over 0.10 up to and including 0.40
------
Over 0.40 up to and including 3.0
------
Over 3.0 up to and including 10.0
------
Over 10.0 up to and including 99.0
------
Default------
Total0.017,3528.341.321038
Bank
Up to and including 0.04
0.032,56317.415.5715112
Over 0.04 up to and including 0.10
0.052,21555.2118.1242634
Over 0.10 up to and including 0.40
0.189260.0036.84363
Over 0.40 up to and including 3.0
0.802357.38104.37262
Over 3.0 up to and including 10.0
------
Over 10.0 up to and including 99.0
------
Default------
Total0.044,89335.5212.3163951
Total credit risk exposures subject
113,89440,6803,254
to the internal ratings based
approach
1
The value of the scalar used in determining the risk weighted assets is 1.06 as required by the conditions of registration

Registered bank disclosures
Unaudited
Unaudited
Westpac New Zealand Limited 41
iv. Capital adequacy under the internal models based approach, and regulatory liquidity ratios (continued)
The following table summarises the Banking Group’s credit risk exposures by asset class arising from undrawn commitments and other off-balance
sheet exposures. These unaudited amounts are included in the previous tables.
Undrawn
Commitments and
Other Off-balance Market Related
Sheet Amounts Contracts
$ millions
ValueEADValueEAD
Residential mortgages
10,5507,869--
Other retail
3,1391,836--
Small business
929770--
Corporate/Business lending
10,43510,580--
Sovereign
7676--
Bank
1,0141,114--
Total 26,14322,245--
Additional mortgage information
Residential mortgages by loan-to-value ratio (‘LVR’) as at 31 March 2020
LVRs are calculated as the current exposure divided by the Banking Group’s valuation of the residential security at origination.
The Banking Group utilises data from its loan system to obtain origination valuations. For loans originated prior to 1 January 2008, or those
originated outside of the loan system, the origination valuation is not recorded in the system and is therefore, due to system limitations, not
available for disclosure. For these loans, the Banking Group utilises the earliest valuation recorded as the closest available alternative to estimate
an origination valuation.
Exposures for which no LVR is available have been included in the ‘Exceeds 90%’ category in accordance with the requirements of the Order.
THE BANKING GROUP
31 Mar 20
Does notExceeds 60%Exceeds 70%Exceeds 80%
LVR range ($ millions)
exceed 60%and not 70%and not 80% and not 90%Exceeds 90%Total
On-balance sheet exposures 22,820 12,769 13,474 2,752 1,223 53,038
Undrawn commitments and other off-balance
sheet exposures
5,604 1,180 776 101 208
7,869
Value of exposures 28,424 13,949 14,250 2,853 1,431 60,907

Registered bank disclosures
Unaudited
Unaudited
42 Westpac New Zealand Limited
iv. Capital adequacy under the internal models based approach, and regulatory liquidity ratios (continued)
Specialised lending subject to the slotting approach
The Banking Group’s specialised lending: Project and property finance credit risk exposures as at 31 March 2020
TotalMinimum
Exposures Risk-Pillar 1
After CreditRiskweightedCapital
Risk MitigationWeightAssets
1
Requirement
$ millions%$ millions$ millions
Supervisory slotting grade
Strong3,66570.002,720218
Good3,23090.003,082247
Satisfactory536115.0065352
Weak149250.0039431
Default
29---
Total on-balance sheet exposures7,60984.916,849548
Undrawn commitments and other off-balance sheet exposures1,33284.881,19896
Total specialised lending exposures (on and off-balance sheet)8,94184.908,047644
1
The value of the scalar used in determining the risk weighted assets is 1.06 as required by the conditions of registration.
Credit risk exposures subject to the standardised approach
The Banking Group’s credit risk exposures subject to the standardised approach as at 31 March 2020
Calculation of on-balance sheet exposures
Total Minimum
ExposureRisk-Pillar 1
After Credit Average RiskweightedCapital
Risk MitigationWeightExposure
1
Requirement
$ millions%$ millions$ millions
Other assets
2
4,41229.911,399112
Total on-balance sheet exposures4,4121,399112
1
The value of the scalar used in determining the risk weighted assets is 1.06 as required by the conditions of registration.
2
Relate to property and equipment, other assets and related parties.

Registered bank disclosures
Unaudited
Unaudited
Westpac New Zealand Limited 43
iv. Capital adequacy under the internal models based approach, and regulatory liquidity ratios (continued)
Calculation of off-balance sheet exposures
TotalAverageMinimum
Exposure orCreditCreditAverageRisk-Pillar 1
PrincipalConversionEquivalentRiskweightedCapital
AmountFactor AmountWeightExposure
1
Requirement
$ millions%$ millions%$ millions$ millions
Market related contracts subject to the
standardised approach
Foreign exchange contracts18,719N/A1,70320.00361 29
Interest rate contracts33,289N/A12120.0026 2
Credit value adjustment-N/A--341 27
Total market related contracts subject to the
standardised approach52,0081,824728 58
Standardised subtotal (on and off-balance sheet)6,2362,127 170
1
The value of the scalar used in determining the risk weighted assets is 1.06 as required by the conditions of registration.
Credit risk mitigation
The Banking Group uses a variety of techniques to reduce the credit risk arising from its lending activities (refer to Note 32.2.2 to the financial
statements included in the Disclosure Statement for the year ended 30 September 2019 for further details). This includes the Banking Group
establishing that it has direct, irrevocable and unconditional recourse to collateral and other credit enhancements through obtaining legally
enforceable documentation.
The Banking Group includes the effect of credit risk mitigation through eligible guarantees within the calculation applied to LGD. Due to system
limitations, the value of the guarantee is not always separately recorded, and therefore, not available for disclosure, under Clause 7 of Schedule 11 to
the Order.
Definitions of PD, LGD and EAD
– Probability of default (‘PD’)
The PD is a through-the-cycle assessment of the likelihood of a customer defaulting on its financial obligations within one year.
– Loss given default (‘LGD’)
The LGD represents an estimate of the expected severity of a loss to the Banking Group should a customer default occur during an economic
downturn.
– Exposure at default (‘EAD’)
EAD represents an estimate of the amount of committed exposure expected to be drawn by the customer at the time of default.
Equity risk
The Banking Group’s equity exposures as at 31 March 2020
Minimum
Risk-Pillar 1
TotalRiskweightedCapital
ExposureWeightExposure
1
Requirement
Equity
$ millions%$ millions$ millions
Equity holdings (not deducted from capital) that are publicly traded-300--
All other equity holdings (not deducted from capital)
-4002-
1
The value of the scalar used in determining the risk weighted assets is 1.06 as required by the conditions of registration.

Registered bank disclosures
Unaudited
Unaudited
44 Westpac New Zealand Limited
iv. Capital adequacy under the internal models based approach, and regulatory liquidity ratios (continued)
Operational risk
Operational risk capital requirement
The following table sets out the Banking Group’s implied risk-weighted exposures under the Advanced Measurement Approach (‘AMA’) methodology
and the operational risk capital requirement.
THE BANKING GROUP
31 Mar 20
Implied Risk-
Total Operational Risk
$ millions
weighted Exposure
Capital Requirement
Advanced Measurement Approach
Operational risk 4,500 360
Market risk
Market risk notional capital charges
The Banking Group’s aggregate market risk exposure is derived in accordance with BS2B and is calculated on a six monthly basis. The end-of-
period aggregate market risk exposure is calculated from the period end balance sheet information.
For each category of market risk, the Banking Group’s peak end-of-day aggregate capital charge is derived by determining the maximum over the
six months ended 31 March 2020 of the aggregate capital charge for that category of market risk at the close of each business day derived in
accordance with BS2B.
The following table provides a summary of the Banking Group’s notional capital charges by risk type as at the reporting date and the peak end-of-
day notional capital charges by risk type for the six months ended 31 March 2020:
THE BANKING GROUP
31 Mar 20
$ millions
Implied risk-weighted exposureAggregate capital charge
End-of-period
Interest rate risk 1,464 117
Foreign currency risk- -
Equity risk- -
Peak end-of-day
Interest rate risk 2,040 163
Foreign currency risk- -
Equity risk- -

Registered bank disclosures
Unaudited
Unaudited
Westpac New Zealand Limited 45
iv. Capital adequacy under the internal models based approach, and regulatory liquidity ratios (continued)
Total capital requirements
Banking Group Pillar 1 Total Capital Requirement
THE BANKING GROUP
31 Mar 20
Risk-weighted
Total Exposure
Exposure or
Implied
After Credit
Risk-weightedTotal Capital
$ millions
Risk MitigationExposureRequirement
Credit risk
Exposures subject to the internal ratings based approach113,89440,6803,254
Equity exposures-2-
Specialised lending subject to the slotting approach8,9418,047644
Exposures subject to the standardised approach6,2362,127170
Total credit risk

(scaled)
1
129,07150,8564,068
Operational riskN/A4,500360
Market riskN/A1,464117
Total129,07156,8204,545
1
The value of the scalar used in determining the credit risk weighted exposure is 1.06 as required by the conditions of registration.
Capital ratios
The table below is disclosed under the Reserve Bank’s Basel III framework in accordance with Clause 15 of Schedule 11 to the Order and represents the
capital adequacy calculation based on BS2B.
For the purposes of calculating the capital adequacy ratios for the Bank on a solo basis, wholly-owned and wholly-funded subsidiaries of the Banking
Group are consolidated with the Bank. In this context, wholly-funded by the Bank means there are no liabilities (including off-balance sheet obligations)
to anyone other than the Bank, the Inland Revenue or trade creditors, where aggregate exposure to trade creditors does not exceed 5% of the
subsidiary’s shareholder’s equity. Wholly-owned by the Bank means that all equity issued by the subsidiary is held by the Bank or is ultimately owned
by the Bank through a chain of ownership where each entity is 100% owned by its parent.
THE BANKING GROUPTHE BANK
Reserve Bank
Minimum
%
Ratios
1
31 Mar 2031 Mar 19
1
31 Mar 2031 Mar 19
Common Equity Tier 1 capital ratio4.511.411.710.611.0
Tier 1 capital ratio6.014.114.513.113.6
Total capital ratio8.015.916.514.815.5
Buffer ratio2.56.95.2N/AN/A
1
Changes to the Bank’s conditions of registration, effective from 31 December 2017, increased the minimum capital ratios by 2% compared to the minimum capital
ratios as at 30 September 2017. The increased minimum capital ratios were to remain in place until the Bank had satisfied the Reserve Bank that all existing issues in
relation to the matters of non-compliance had been resolved. Effective from 31 December 2019, the Reserve Bank amended the Bank’s conditions of registration to
remove the two percentage point overlay applying to its minimum capital requirements. Refer to the ‘Non-compliance with conditions of registration’ section on page
49 for further details.

Registered bank disclosures
Unaudited
Unaudited
46 Westpac New Zealand Limited
iv. Capital adequacy under the internal models based approach, and regulatory liquidity ratios (continued)
Capital for other material risks
The Banking Group’s internal capital adequacy assessment process identifies, reviews and measures additional material risks that must be captured
within the Banking Group’s capital adequacy assessment process. The additional material risks considered are those not captured by Pillar 1 regulatory
capital requirements and include compliance risk, conduct risk, liquidity risk, reputational risk, environmental, social and governance risk, business/
strategic risk, other assets risk, model risk, deferred acquisition cost risk and subsidiary risk.
The Banking Group’s internal capital allocation for ‘other material risks’ is $264 million as at 31 March 2020 (31 March 2019: $243 million).
Ultimate Parent Bank Group Basel III capital adequacy ratios
The table below represents the capital adequacy calculation for the Ultimate Parent Bank and the Ultimate Parent Bank Group based on APRA’s
application of the Basel III capital adequacy framework.
%
31 Mar 2031 Mar 19
Ultimate Parent Bank Group (excluding entities specifically excluded by APRA regulations)
1, 2
Common Equity Tier 1 capital ratio 10.8 10.6
Additional Tier 1 capital ratio 2.1 2.2
Tier 1 capital ratio 12.9 12.8
Tier 2 capital ratio 3.4 1.8
Total regulatory capital ratio 16.3 14.6
Ultimate Parent Bank (Extended Licensed Entity)
1, 3
Common Equity Tier 1 capital ratio 11.1 10.7
Additional Tier 1 capital ratio 2.2 2.3
Tier 1 capital ratio 13.3 13.0
Tier 2 capital ratio 3.4 1.8
Total regulatory capital ratio 16.7 14.8
1
The capital ratios represent information mandated by APRA. The capital ratios of the Ultimate Parent Bank Group are publicly available in the Ultimate Parent Bank
Group’s Pillar 3 report. This information is made available to users via the Ultimate Parent Bank’s website (www.westpac.com.au).
2
Ultimate Parent Bank Group (excluding entities specifically excluded by APRA regulations) comprises the consolidation of the Ultimate Parent Bank and its subsidiary
entities except those entities specifically excluded by APRA regulations for the purposes of measuring capital adequacy (Level 2). The head of the Level 2 group is the
Ultimate Parent Bank.
3
Ultimate Parent Bank (Extended Licensed Entity) comprises the Ultimate Parent Bank and its subsidiary entities that have been approved by APRA as being part of a
single ELE for the purposes of measuring capital adequacy (Level 1).
Under APRA’s Prudential Standards, Australian authorised deposit-taking institutions (‘ADI’), including the Ultimate Parent Bank Group and the
Ultimate Parent Bank are required to maintain minimum ratios of capital to risk weighted assets, as determined by APRA. For the calculation of risk
weighted assets, the Ultimate Parent Bank Group and the Ultimate Parent Bank are accredited by APRA to apply advanced models permitted by the
Basel III global capital adequacy regime. The Ultimate Parent Bank Group and the Ultimate Parent Bank use the Advanced Internal Ratings Based
(‘Advanced IRB’) approach for credit risk, the AMA for operational risk and the internal model approach for interest rate risk in the banking book for
calculating regulatory capital.
APRA’s prudential standards are generally consistent with the International Regulatory Framework for Banks, also known as Basel III, issued by the
BCBS, except where APRA has exercised certain discretions.
The Ultimate Parent Bank Group is required to disclose additional detailed information on its risk management practices and capital adequacy on a
quarterly basis. This information is made available to users via the Ultimate Parent Bank’s website (www.westpac.com.au).
The Ultimate Parent Bank Group (excluding entities specifically excluded by APRA regulations), and the Ultimate Parent Bank (Extended Licensed Entity
as defined by APRA), exceeded the minimum capital adequacy requirements as specified by APRA as at 31 March 2020.

Registered bank disclosures
Unaudited
Unaudited
Westpac New Zealand Limited 47
iv. Capital adequacy under the internal models based approach, and regulatory liquidity ratios (continued)
Regulatory liquidity ratios
The Bank calculates liquidity ratios in accordance with the Reserve Bank document entitled ‘Liquidity Policy’ (BS 13) (‘BS 13’). Ratios are calculated
daily and are part of the Bank’s management of liquidity risk (refer to Note 32.3 to the financial statements included in the Disclosure Statement for
the year ended 30 September 2019 for further details). Quarterly average ratios are produced in line with the Reserve Bank rules and guidance.
THE BANKING GOUP
%
31 Mar 2031 Dec 19
Average for the three months ended
One-week mismatch ratio7.16.4
One-month mismatch ratio9.99.1
Core funding ratio82.283.1
v. Concentration of credit exposures to individual counterparties
The following credit exposures are based on actual credit exposures to individual counterparties and groups of closely related counterparties.
The number of individual bank and non-bank counterparties to which the Banking Group has an aggregate credit exposure or peak end-of-day aggregate
credit exposure that equals or exceeds 10% of the Banking Group’s Common Equity Tier 1 capital:
THE BANKING GROUP
31 Mar 20
Bank Counterparties
1
Non-bank Counterparties
2
Long-term credit ratingLong-term credit rating
% of Banking Group's Common Equity Tier 1 Capital
A- or A3 and aboveA- or A3 and above
As at 31 March 2020
3
Exceeds 10% and not 15% 3 1
Exceeds 15% and not 20%- 2
Exceeds 20% and not 25%--
Exceeds 25% and not 30%--
Peak end-of-day aggregate credit exposure for the six months ended 31 March 2020
3
Exceeds 10% and not 15% 2 2
Exceeds 15% and not 20% 1 1
Exceeds 20% and not 25%--
Exceeds 25% and not 30%
- 1
1
A counterparty is a bank counterparty if it is a bank that is not a member of a group of closely related counterparties or it is a group of closely related counterparties
of which a bank is the parent.
2
A counterparty is a non-bank counterparty if it is a non-bank that is not a member of a group of closely related counterparties or it is a group of closely related
counterparties of which a bank is not the parent.
3
There were no individual bank or non-bank counterparties with aggregate credit exposure that equals or exceeds 10% of the Banking Group’s Common Equity Tier 1
capital and with a long-term credit rating of less than A- or A3, or its equivalent, or unrated.
The peak end-of-day aggregate credit exposure to each individual counterparty (which are not members of a group of closely related
counterparties) or a group of closely related counterparties has been calculated by determining the maximum end-of-day aggregate amount of
actual credit exposure over the relevant six-month period, and then dividing that amount by the Banking Group’s Common Equity Tier 1 capital as at
31 March 2020.
Credit exposures to individual counterparties (not being members of a group of closely related counterparties) and to groups of closely related
counterparties exclude exposures to connected persons, to the central government or central bank of any country with a long-term credit rating of
A- or A3 or above, or its equivalent, or to any supranational or quasi-sovereign agency with a long-term credit rating of A- or A3 or above, or its
equivalent. These calculations relate only to exposures held in the financial records of the Banking Group and were calculated net of individually
assessed provisions.

Registered bank disclosures
Unaudited
Unaudited
48 Westpac New Zealand Limited
vi. Insurance business
The Banking Group does not conduct any insurance business (as that term is defined in the Order).
vii. Risk management policies
During the period, the Banking Group made changes to a number of policies within credit manuals to reflect the NZ Government’s COVID-19 relief
schemes, including mortgage payment deferrals and the Business Finance Guarantee.

Conditions of registration
Westpac New Zealand Limited 49
Non-compliance with conditions of registration
In June 2019, in response to a review under section 95 of the Reserve
Bank Act of the Bank’s compliance with advanced internal rating
based aspects of the Reserve Bank's 'Capital Adequacy Framework
(Internal Models Based Approach)’ (‘BS2B’), the Bank presented the
Reserve Bank with a submission providing an overview of its credit risk
rating system and activities undertaken since FY17 to address
compliance issues and enhance risk management practices.
On 30 October 2019, the Reserve Bank informed the Bank that it had
accepted the submission and measures undertaken by the Bank to
achieve satisfactory compliance with BS2B, and that the Bank would
retain its accreditation to use internal models for credit risk in the
calculation of its regulatory capital requirements.
With effect from 31 December 2019, the Reserve Bank removed the
requirement imposed on the Bank since 31 December 2017 to maintain
minimum regulatory capital ratios which were two percentage points
higher than the ratios applying to other locally incorporated banks.
During the reporting period, the Bank was non-compliant with
condition of registration 1B (which requires the Bank to comply with
aspects of BS2B) in relation to the matters disclosed below.
It operated versions of various capital models which were not
approved by the Reserve Bank, in some cases since December
2008, and it failed to meet the Reserve Bank’s requirements in
relation to model documentation and associated model
documentation policies. On 30 October 2019, the Reserve Bank
confirmed its approval of all unapproved models, other than a PD
model for a small number of corporate exposures. Work is
underway to address this issue.
The Model Compendium required under 1.3B of BS2B
(‘Compendium’) was not accurate. Further to the Reserve Bank’s
determination, an updated Compendium has been submitted to
the Reserve Bank for review and was subsequently approved on
24 January 2020.
It is not fully compliant with paragraph 4.246 of BS2B in that, with
the exception of wholesale property development and
investment customers, non-retail risk grade credit policy
overrides are not captured and monitored. A new system to
capture relevant non-retail customer credit data has been built,
is in use and will address this issue.
It is not fully compliant with paragraph 4.248 of BS2B in that not
all historical origination data for non-retail customers is
maintained in a format that allows easy accessibility to key data
used to derive the original risk rating. A new system to capture
relevant non-retail customer credit data has been built, is in use
and will address this issue.
During the reporting period, the Bank was also non-compliant with
condition of registration 1B that was in effect prior to 1 January 2019 in
relation to the matters below. These matters do not result in non-
compliance with the current version of condition of registration 1B in
effect from 1 January 2019.
It was not fully compliant with paragraph 4.4 of BS2B in that a
small number of Corporate asset class exposures were
incorrectly classified as Retail SME asset class exposures. The
amount is not assessed to be material.
It was not fully compliant with paragraph 4.61A of BS2B in that, in
respect of a small number of agricultural customers, it used the
customer limit rather than the current balance for calculating
loan-to-value ratio (‘LVR’). This resulted in an understatement of
Risk Weighted Assets (‘RWA’). The amount is not assessed to be
material.
For less than one percent of its residential mortgages by loan
value, its use of total committed exposure rather than EAD for
calculating LVR for capital adequacy purposes does not meet the
minimum LGD requirements of paragraph 4.150 A of BS2B.
Additionally, for less than 5% of accounts by number, the
security value utilised within the calculation of LVR is an updated
valuation and not the origination value as required by that
paragraph. These issues were addressed by the Mortgage LGD
model approved by the Reserve Bank on 30 October 2019.
It is not fully compliant with paragraphs 4.86-4.97 of BS2B in that
for some exposures where the maturity measure is missing, the
default maturity applied is not a conservative measure. The
amount is not assessed to be material.
As disclosed in Note iv. of the Registered bank disclosures, the Bank
considers its current internal credit model methodologies result in the
retention of an appropriate amount of capital to reflect its credit risk.
Any effect of the non-compliance with condition of registration 1B on
the information relating to capital adequacy disclosed in Note iv. of
the Registered bank disclosures was not considered by the Bank to be
material.
The Bank identified the following non-compliances with condition of
registration 25, which requires compliance with the Reserve Bank
Outsourcing Policy (‘BS11’):
The Bank renewed three existing outsourcing arrangements (as
defined in BS11) for licensing and support of software applications
(and related dedicated hardware for one application) and did not
have in place the required risk mitigants for the arrangements as
required by BS11. The outsourcing arrangements have been
amended to include the requisite risk mitigants.
The Bank did not renew nine outsourcing arrangements (as
defined in BS11) by the contract expiry dates, including for courier
services, test resourcing and the licensing and/or support of
various software applications, but it continued to receive services
from the relevant vendors and make payment. Work is underway
to renew the outsourcing arrangements which will include the
required risk mitigants for the arrangements as required by BS11.
The Bank’s compendium of outsourcing arrangements did not
include the upfront costs for sixteen outsourcing arrangements
as is required to be included for each outsourcing arrangement
by BS11. Work is underway to update the compendium to include
such costs.

Conditions of registration
50 Westpac New Zealand Limited
Changes to conditions of registration
The Reserve Bank amended the Bank’s conditions of registration:
 with effect from 31 December 2019, the Reserve Bank amended the Bank’s conditions of registration to remove the percentage point overlay
applying to its minimum capital requirements following the resolution of matters of non-compliance with BS2B.
 with effect from 2 April 2020:
-to ban distributions and to restrict the extent to which distributions on Additional Tier 1 capital instruments are permitted;
-to reduce the minimum core funding ratio from 75% to 50%; and
-to extend the transition period for the Reserve Bank Outsourcing Policy (‘BS11’) by 12 months; and
 with effect from 1 May 2020, to remove restrictions on the Bank’s new residential mortgage lending at high loan-to-valuation (‘LVR’) ratios.

Westpac New Zealand Limited 51
Independent auditor’s review report
To the shareholder of Westpac New Zealand Limited
Report on the Disclosure Statement
We have reviewed pages 6 to 25 and pages 28 to 48 of the Disclosure Statement for the six months ended 31 March
2020 (the “Disclosure Statement”) of Westpac New Zealand Limited (the “Bank”) and the entities it controlled at 31
March 2020 or from time to time during the period (the “Banking Group”), which includes the financial statements
required by Clause 25 of the Registered Bank Disclosure Statements (New Zealand Incorporated Registered Banks)
Order 2014 (as amended) (the “Order”) and the supplementary information required by Schedules 5, 7, 11, 13, 16
and 18 of the Order.
The financial statements on pages 6 to 25 comprise the balance sheet as at 31 March 2020, the income statement,
the statement of comprehensive income, the statement of changes in equity and the statement of cash flows for the
six months then ended, and the notes to the financial statements that include a statement of accounting policies and
selected explanatory notes.
The supplementary information is included within notes 3, 5 and 6 of the financial statements and notes ii to vii of
the registered bank disclosures.
Directors’ responsibility for the Disclosure Statement
The Directors of the Bank (the “Directors”) are responsible, on behalf of the Bank, for the preparation and fair
presentation of the Disclosure Statement, which includes financial statements prepared in accordance with Clause
25 of the Order and for such internal control as the Directors determine is necessary to enable the preparation of
financial statements that are free from material misstatement, whether due to fraud or error.
In addition, the Directors are responsible, on behalf of the Bank, for the preparation and fair presentation of the
supplementary information in the Disclosure Statement which complies with Schedules 3, 5, 7, 11, 13, 16 and 18 of
the Order.
Our responsibility
Our responsibility is to express the following conclusions on the financial statements and supplementary
information presented by the Directors based on our review:
the financial statements (excluding the supplementary information): whether, in our opinion on the basis of
the procedures performed by us, anything has come to our attention that would cause us to believe that the
financial statements have not been prepared, in all material respects, in accordance with New Zealand
Equivalent to International Accounting Standard 34: Interim Financial Reporting (NZ IAS 34) and
International Accounting Standard 34: Interim Financial Reporting (IAS 34);
the supplementary information (excluding the supplementary information relating to capital adequacy and
regulatory liquidity requirements): whether, in our opinion on the basis of the procedures performed by us,
anything has come to our attention that would cause us to believe that the supplementary information does
not fairly state the matters to which it relates in accordance with Schedules 5, 7, 13, 16 and 18 of the Order;
and
the supplementary information relating to capital adequacy and regulatory liquidity requirements: whether,
in our opinion on the basis of the procedures performed by us, anything has come to our attention that
would cause us to believe that the supplementary information is not, in all material respects, disclosed in
accordance with Schedule 11 of the Order.
We conducted our review in accordance with the New Zealand Standard on Review Engagements 2410: Review of
Financial Statements Performed by the Independent Auditor of the Entity (NZ SRE 2410). As the auditor of the
Banking Group, NZ SRE 2410 requires that we comply with the ethical requirements relevant to the audit of the
annual financial statements.
PricewaterhouseCoopers, 188 Quay Street, Private Bag 92162, Auckland 1142, New Zealand
T: +64 9 355 8000, F: +64 9 355 8001, pwc.co.nz

52 Westpac New Zealand Limited
A review in accordance with NZ SRE 2410 is a limited assurance engagement. The auditor performs procedures,
primarily consisting of making enquiries, primarily of persons responsible for financial and accounting matters,
and applying analytical and other review procedures. The procedures performed in a review are substantially less
than those performed in an audit conducted in accordance with International Standards on Auditing (New
Zealand) and International Standards on Auditing. Accordingly, we do not express an audit opinion on the
financial statements and supplementary information.
We are independent of the Banking Group. Our firm carries out other services for the Banking Group in the areas
of other audit related services relating to the issuance of comfort letters and agreed upon procedures reports on
debt issuance programmes. In addition, certain partners and employees of our firm may deal with the Banking
Group on normal terms within the ordinary course of trading activities of the Banking Group. These matters have
not impaired our independence as auditor of the Banking Group.
Conclusion
We have examined the financial statements and supplementary information and based on our review, nothing has
come to our attention that causes us to believe that:
a)the financial statements (excluding the supplementary information) have not been prepared, in all material
respects, in accordance with NZ IAS 34 and IAS 34;
b)the supplementary information that is required to be disclosed under Schedules 5, 7, 13, 16 and 18 of the
Order, does not fairly state the matters to which it relates in accordance with those Schedules; and
c)the supplementary information relating to capital adequacy and regulatory liquidity requirements that is
required to be disclosed under Schedule 11 of the Order, is not, in all material respects, disclosed in
accordance with Schedule 11 of the Order.
Who we report to
This report is made solely to the Bank’s shareholder. Our review work has been undertaken so that we might state
those matters which we are required to state to them in our review report and for no other purpose. To the fullest
extent permitted by law, we do not accept or assume responsibility to anyone other than the Bank and the Bank’s
shareholder, for our review procedures, for this report, or for the conclusions we have formed.
For and on behalf of:
Chartered AccountantsAuckland
21 May 2020

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