Westpac Pillar 3 Report (June 2020)

ASX Release
18 AUGUST 2020
Pillar 3 Report as at 30 June 2020
Westpac Banking Corporation (“Westpac”) today provides the attached Pillar 3
Report as at 30 June 2020.
For further information:
D
avid Lording Andrew Bowden
Group Head of Media Relations Head of Investor Relations
0419 683 411 0438 284 863
This document has been authorised for release by Tim Hartin, General Manager & Company
Secretary.
Level 18, 275 Kent Street
Sydney, NSW, 2000

Pillar 3
Report
June 2020
Incorporating the requirements of APS330
Westpac Banking Corporation ABN 33 007 457 141

Pillar 3 report
Table of contents

2 | Westpac Group June 2020 Pillar 3 Report

Structure of Pillar 3 report

Executive summary 3
Introduction 5
Group structure 7
Capital overview 8
Leverage ratio 12
Credit risk exposures 13
Securitisation 17
Liquidity coverage ratio 20
Appendix
Appendix I | APS330 Quantitative requirements 21
Disclosure regarding forward-looking statements 22




















In this report references to ‘Westpac’, ‘Westpac Group’, ‘the Group’, ‘we’, ‘us’ and ‘our’ are to Westpac
Banking Corporation and its controlled entities (unless the context indicates otherwise).
In this report, unless otherwise stated or the context otherwise requires, references to ‘$’, ‘AUD’ or ‘A$’ are
to Australian dollars.
Any discrepancies between totals and sums of components in tables contained in this report are due to
rounding.
In this report, unless otherwise stated, disclosures reflect the Australian Prudential Regulation Authority’s
(APRA) implementation of Basel III.
Information contained in or accessible through the websites mentioned in this report does not form part of
this report unless we specifically state that it is incorporated by reference and forms part of this report. All
references in this report to websites are inactive textual references and are for information only.

Pillar 3 report
Executive summary

Westpac Group June 2020 Pillar 3 Report | 3
Key capital ratios
30 June 202031 March 202030 June 2019
Level 2 Regulatory capital structure
Common equity Tier 1 capital after deductions ($m)48,679 47,982 44,459
Risk weighted assets (RWA) ($m)450,564 443,905 422,164
Common equity Tier 1 capital ratio %10.80 10.81 10.53
Additional Tier 1 capital ratio %2.06 2.13 2.19
Tier 1 capital ratio %12.86 12.94 12.72
Tier 2 capital %3.13 3.35 1.78
Total regulatory capital ratio %15.99 16.29 14.50
APRA leverage ratio %5.88 5.66 5.67
Level 1 Regulatory capital structure
Common equity Tier 1 capital after deductions ($m)49,305 48,482 43,376
Risk weighted assets (RWA) ($m)443,613 437,137 411,240
Level 1 Common equity Tier 1 capital ratio %11.11 11.09 10.55


CET1 capital ratio movement for Third Quarter 2020
The Common Equity Tier 1 (CET1) ratio of 10.80% at 30 June 2020 is little changed from the 31 March
CET1 ratio of 10.81%. The cash earnings contribution for the quarter was largely offset by higher RWA and
an increase in other capital deductions. Higher RWA reflects the impact of credit deterioration across the
portfolio together with overlays for potential further deterioration. The ratio of RWA to Exposure at Default
(EAD) increased by 1.4 percentage points since March 2020 to 38.4%
1
, which has reduced the CET1 ratio
at 30 June 2020 by 30 basis points.
CET1 movement – Third Quarter 2020

Key movements in the CET1 capital ratio over the quarter due to:
• 3Q20 cash earnings of $1,318 million (29 basis point increase), which included impairment charges of
$826 million. Impairment charges over the quarter have lifted the provision coverage, with the ratio of
total provisions to credit RWA of 1.70% at 30 June 2020 up from 1.57% at 31 March 2020
• RWA increase (27 basis point decrease), mainly driven by higher credit risk RWA from a deterioration
in credit quality and overlays;
• Foreign currency impacts (3 basis point decrease)
2
from the appreciation of the A$ against the NZ$ and
US$; and
• Capital deductions and other capital movements (6 basis point decrease), comprising deferred tax
assets related to credit provisions (7 basis point decrease) and other deductions (2 basis point
decrease), partially offset by the sale of the remaining holding in Pendal Group Limited (3 basis point
increase). The capital deduction for regulatory expected loss remained at nil as eligible provisions still
exceed regulatory expected loss at 30 June 2020.



1
Calculated as EAD/credit RWA excluding sovereigns, banks and standardised exposure classes.
2
Reflecting the net impact of movements in the foreign currency translation reserve and RWA.

Pillar 3 report
Executive summary

4 | Westpac Group June 2020 Pillar 3 Report
Risk Weighted Assets (RWA)
$m30 June 202031 March 202030 June 2019
Risk weighted assets at Level 2
Credit risk373,675369,142366,701
Market risk9,4868,3968,037
Operational risk54,09054,09341,266
Interest rate risk in the banking book (IRRBB)6,8495,3052,745
Other 6,4646,9693,415
Total RWA450,564443,905422,164
Total Exposure at Default1,058,2691,089,1041,033,702


Total RWA increased $6.7 billion or 1.5% over the quarter mainly driven by an increase in credit risk RWA.
The $4.5 billion increase in credit risk RWA included:
• An overlay to the probability of default for corporate, business lending and specialised lending
1
which
led to a $7bn increase in RWA and an associated increase in regulatory expected loss of $323 million.
In line with APRA guidance, ADI’s are permitted to maintain the existing internal rating of these
borrowers and instead reflect the increase in credit risk (probability of default) of impacted borrowers
through an overlay. This overlay will be reviewed regularly as individual customers are assessed and
re-gradings are finalised.
• Credit quality deterioration increasing RWA by $6.2 billion mainly comprising:
o Mortgages up $3.6 billion primarily from a rise in customers in hardship. This reflects our
approach to applying COVID-19 relief which means a number of customers were offered
assistance through our hardship program. There is no impact to RWA from customers that are
on repayment deferral packages in accordance with APRA guidance
2
;
o Downgrades across the corporate and business portfolios, which increased RWA by $2.1
billion; and
o Small business and other portfolios up $0.5 billion mainly from an increase in defaulted and
impaired loans.
• Offset by a $8.7 billion decline in RWA from:
o $1.8 billion from lower lending due to subdued demand across retail and business portfolios,
and from exposure reductions in corporate;
o Foreign currency translation impacts decreased RWA by $4.4 billion due to the appreciation of
the A$ against the US$ and NZ$; and
o A decrease in mark-to-market related credit risk and counterparty credit risk RWA of $2.5
billion.
Non-credit risk RWA increased $2.1 billion from higher market risk RWA (up $1.1 billion) and IRRBB (up
$1.5 billion). These were partly offset by a $0.5 billion decrease in Other RWA.

Exposure at Default
Exposure at default (EAD) decreased $30.8 billion (or 2.8%) over the quarter, primarily due to lower
sovereign associated with decreased liquidity needs and lower corporate exposures.

Leverage Ratio
The leverage ratio represents the amount of Tier 1 capital relative to exposure
3
. At 30 June 2020,
Westpac’s leverage ratio was 5.88%, up 22 basis points since 31 March 2020.

Liquidity Coverage Ratio (LCR)
Westpac’s average LCR for the quarter ending 30 June 2020 was 146% (March quarter 2020: 140%)
4
.

1
The overlay has impacted the following assets classes: Corporate ($0.8 billion RWA, $22 million regulatory expected loss),
Busines lending ($2.1 billion RWA, $88 million regulatory expected loss) and Specialised lending ($4.1 billion RWA, $213
million regulatory expected loss).
2
23 March 2020 ‘APRA advises regulatory approach to COVID-19 support’ and updated guidance on 8 July 2020 APRA
updates regulatory approach to loans subject to repayment deferral’.
3
As defined under Attachment D of APS110: Capital Adequacy.
4
Calculated as a simple average of the daily observations over the relevant quarter.

Pillar 3 report
Introduction

Westpac Group June 2020 Pillar 3 Report | 5
Westpac Banking Corporation is an Authorised Deposit–taking Institution (ADI) subject to regulation by the
APRA. APRA has accredited Westpac to apply advanced models permitted by the Basel III global capital
adequacy regime to the measurement of its regulatory capital requirements. Westpac uses the Advanced
Internal Ratings-Based approach (Advanced IRB) for credit risk and the Advanced Measurement Approach
(AMA) for operational risk.
In accordance with APS330 Public Disclosure, financial institutions that have received this accreditation,
such as Westpac, are required to disclose prudential information about their risk management practices on
a semi-annual basis. A subset of this information must be disclosed quarterly.
In addition to this report, the regulatory disclosures section of the Westpac website
1
contains the reporting
requirements for:
• Capital instruments under Attachment B of APS330; and
• The identification of potential Global-Systemically Important Banks (G-SIB) under Attachment H of
APS330 (disclosed annually).
Capital instruments disclosures are updated when:
• A new capital instrument is issued that will form part of regulatory capital; or
• A capital instrument is redeemed, converted into CET1 capital, written off, or its terms and conditions
are changed.





1
http://www.westpac.com.au/about-westpac/investor-centre/financial-information/regulatory-disclosures/

Pillar 3 report
Group structure

6 | Westpac Group June 2020 Pillar 3 Report
Westpac seeks to ensure that it is adequately capitalised at all times. APRA applies a tiered approach to
measuring Westpac’s capital adequacy
1
by assessing financial strength at three levels:
• Level 1, comprising Westpac Banking Corporation and its subsidiary entities that have been approved
by APRA as being part of a single 'Extended Licensed Entity' (ELE) for the purposes of measuring
capital adequacy;
• Level 2, the consolidation of Westpac Banking Corporation and all its subsidiary entities except those
entities specifically excluded by APRA regulations. The head of the Level 2 group is Westpac Banking
Corporation; and
• Level 3, the consolidation of Westpac Banking Corporation and all its subsidiary entities.
Unless otherwise specified, all quantitative disclosures in this report refer to the prudential assessment of
Westpac’s financial strength on a Level 2 basis
2
.
The Westpac Group
The following diagram shows the Level 3 conglomerate group and illustrates the different tiers of regulatory
consolidation.
Level 1 Consolidation
Level 2 Consolidation
Level 3 Consolidation
Regulatory
non-consolidated
subsidiaries
Westpac
New Zealand Ltd
Other Westpac Level 2
subsidiaries
Westpac Banking
Corporation
Westpac Level 1
subsidiaries


Accounting consolidation
3

The consolidated financial statements incorporate the assets and liabilities of all subsidiaries (including
structured entities) controlled by Westpac. Westpac and its subsidiaries are referred to collectively as the
‘Group’. The effects of all transactions between entities in the Group are eliminated. Control exists when the
parent entity is exposed to, or has rights to, variable returns from its involvement with an entity, and has the
ability to affect those returns through its power over that entity. Subsidiaries are fully consolidated from the
date on which control commences and they are no longer consolidated from the date that control ceases.
Group entities excluded from the regulatory consolidation at Level 2
Regulatory consolidation at Level 2 covers the global operations of Westpac and its subsidiary entities,
including other controlled banking, securities and financial entities, except for those entities involved in the
following business activities:
• insurance;
• acting as manager, responsible entity, approved trustee, trustee or similar role in relation to funds
management;
• non-financial (commercial) operations; or
• special purpose entities to which assets have been transferred in accordance with the requirements of
APS120 Securitisation.
Retained earnings and equity investments in subsidiary entities excluded from the consolidation at Level 2
are deducted from capital, with the exception of securitisation special purpose entities.

1
APS110 Capital Adequacy outlines the overall framework adopted by APRA for the purpose of assessing the capital
adequacy of an ADI.
2
Impaired assets and provisions held in Level 3 entities are excluded from the tables in this report.
3
Refer to Note 31 of Westpac’s 2019 Annual Report for further details.

Pillar 3 report
Group structure

Westpac Group June 2020 Pillar 3 Report | 7
Subsidiary banking entities
Westpac New Zealand Limited (WNZL), a wholly owned subsidiary entity, is a registered bank incorporated
in New Zealand and regulated by the Reserve Bank of New Zealand (RBNZ). WNZL uses the Advanced
IRB approach for credit risk and the AMA for operational risk. Other subsidiary banking entities in the Group
include Westpac Bank-PNG-Limited and Westpac Europe Limited. For the purposes of determining
Westpac’s capital adequacy subsidiary banking entities are consolidated at Level 2.
Restrictions and major impediments on the transfer of funds or regulatory capital within the Group
Minimum capital (‘thin capitalisation’) rules
Tax legislation in most jurisdictions in which the Group operates prescribes minimum levels of capital that
must be retained in that jurisdiction to avoid a portion of the interest costs incurred in the jurisdiction ceasing
to be tax deductible. Capital for these purposes includes both contributed capital and non-distributed
retained earnings. Westpac seeks to maintain sufficient capital/retained earnings to comply with these rules.
Tax costs associated with repatriation
Repatriation of retained earnings (and capital) may result in tax being payable in either the jurisdiction from
which the repatriation occurs or Australia on receipt of the relevant amounts. This cost would reduce the
amount actually repatriated.
Intra-group exposure limits
Exposures to related entities are managed within the prudential limits prescribed by APRA in APS222
Associations with Related Entities
1
. Westpac has an internal limit structure and approval process governing
credit exposures to related entities. This limit structure and approval process, combined with APRA’s
prudential limits, is designed to reduce the potential for unacceptable contagion risk.
Prudential regulation of subsidiary entities
Certain subsidiary banking, insurance and trustee entities are subject to local prudential regulation in their
own right, including capital adequacy requirements and investment or intra-group exposure limits. Westpac
seeks to ensure that its subsidiary entities are adequately capitalised and adhere to regulatory requirements
at all times. There are no capital deficiencies in subsidiary entities excluded from the regulatory
consolidation at Level 2.
On 4 November 2019, the RBNZ advised it would change WNZL’s conditions of registration to remove the
2% overlay applying to its minimum capital requirements from 31 December 2019. This overlay had been in
place since 31 December 2017 following the RBNZ’s review of WNZL’s compliance with the RBNZ’s
‘Capital Adequacy Framework’ (Internal Models Based Approach) (BS2B).
On 2 April 2020, a decision was made by the RBNZ to freeze the distribution of dividends on ordinary
shares by all banks in New Zealand during the period of economic uncertainty caused by COVID-19.


1
For the purposes of APS222, subsidiaries controlled by Westpac, other than subsidiaries that form part of the ELE, represent
‘related entities’. Prudential and internal limits apply to intra-group exposures between the ELE and related entities, both on an
individual and aggregate basis.

Pillar 3 report
Capital overview

8 | Westpac Group June 2020 Pillar 3 Report
Capital management strategy
Westpac’s approach to capital management seeks to ensure that it is adequately capitalised as an ADI.
Westpac evaluates its approach to capital management through an Internal Capital Adequacy Assessment
Process (ICAAP), the key features of which include:
• the development of a capital management strategy, including consideration of regulatory minimums,
capital buffers and contingency plans;
• consideration of both regulatory and economic capital requirements;
• a stress testing framework that challenges the capital measures, coverage and requirements including
the impact of adverse economic scenarios; and
• consideration of the perspectives of external stakeholders including rating agencies as well as equity
and debt investors.
During the period of disruption caused by COVID-19, Westpac will seek to operate with the following
principles in relation to capital:
• prioritise maintaining capital strength;
• retain capital to absorb further downside on credit quality and acknowledge a high degree of uncertainty
regarding the length and depth of this stress;
• allow for capital flexibility to support lending to customers; and
• in line with APRA guidance, where necessary utilise some of the “unquestionably strong” buffer and
seek to maintain a buffer above the regulatory minimum.
These principles take into consideration:
• current regulatory capital minimums and the capital conservation buffer (CCB), which together are the
Total CET1 Requirement. In line with the above, the Total CET1 Requirement for Westpac is at least
8.0%, based upon an industry minimum CET1 requirement of 4.5% plus a capital buffer of at least 3.5%
applicable to D-SIBs
1, 2
;
• stress testing to calibrate an appropriate buffer against a downturn; and
• quarterly volatility of capital ratios due to the half yearly cycle of ordinary dividend payments.
Westpac will revise its target capital levels once the medium to longer term impacts of COVID-19 are
clearer, taking into account APRA’s expectations for the timing of any capital rebuilding required and the
finalisation of APRA’s review of the capital adequacy framework.

APRA announcements on capital
On 27 July 2020, APRA released further capital management guidance for ADIs
3
. This guidance included
APRA’s expectation that for 2020, ADIs will retain at least half of their earnings, actively use dividend
reinvestment plans (DRPs) and/or other capital management initiatives to at least partially offset the
diminution in capital from distributions and conduct regular stress testing to inform decision-making and
demonstrate ongoing lending capacity. APRA also committed to ensuring that any rebuild of capital buffers,
if required, will be conducted in a gradual manner. APRA noted that the implementation of the Basel III
capital reforms, which will embed the ‘unquestionably strong’ level of capital in the framework, has been
postponed to 1 January 2023.







1
Noting that APRA may apply higher CET1 requirements for an individual ADI.
2
If an ADI’s CET1 ratio falls below the Total CET1 Requirement (at least 8%), they face restrictions on the distribution of
earnings, such as dividends, distribution payments on AT1 capital instruments and discretionary staff bonuses.
3
Letter to Authorised Deposit Taking institutions – Capital Management, 29 July 2020.

Pillar 3 report
Capital overview

Westpac Group June 2020 Pillar 3 Report | 9
Westpac’s capital adequacy ratios
% 30 June 202031 March 2020 30 June 2019
The Westpac Group at Level 2
Common equity Tier 1 capital ratio10.8 10.8 10.5
Additional Tier 1 capital2.1 2.1 2.2
Tier 1 capital ratio12.9 12.9 12.7
Tier 2 capital3.1 3.4 1.8
Total regulatory capital ratio16.0 16.3 14.5
The Westpac Group at Level 1
Common equity Tier 1 capital ratio11.1 11.1 10.5
Additional Tier 1 capital2.1 2.2 2.3
Tier 1 capital ratio13.2 13.3 12.8
Tier 2 capital3.2 3.4 1.9
Total regulatory capital ratio16.4 16.7 14.7


Westpac New Zealand Limited’s capital adequacy ratios
% 30 June 202031 March 2020 30 June 2019
Westpac New Zealand Limited
Common equity Tier 1 capital ratio11.9 11.4 12.0
Additional Tier 1 capital2.6 2.7 2.7
Tier 1 capital ratio14.5 14.1 14.7
Tier 2 capital2.1 1.8 2.0
Total regulatory capital ratio16.6 15.9 16.7

Pillar 3 report
Capital overview

10 | Westpac Group June 2020 Pillar 3 Report
Capital requirements
This table shows risk weighted assets and associated capital requirements
1
for each risk type included in
the regulatory assessment of Westpac’s capital adequacy. More detailed disclosures on the prudential
assessment of capital requirements are presented in the following sections of this report.
234

30 June 2020
IRBStandardisedTotal Risk Total Capital
$mApproach
Approach
2
Weighted Assets
Required
1
Credit risk
Corporate76,303 1,012 77,315 6,185
Business lending37,584 913 38,497 3,080
Sovereign2,194 1,233 3,427 274
Bank6,461 63 6,524 522
Residential mortgages134,425 4,567 138,992 11,119
Australian credit cards4,332 - 4,332 347
Other retail10,594 796 11,390 911
Small business17,638 - 17,638 1,411
Specialised lending59,114 458 59,572 4,766
Securitisation5,429 - 5,429 434
Mark-to-market related credit risk
3
- 10,559 10,559 845
Total354,074 19,601 373,675 29,894
Market risk9,486 759
Operational risk54,090 4,327
Interest rate risk in the banking book6,849 548
Other assets
4
6,464 517
Total450,564 36,045
31 March 2020
IRBStandardisedTotal Risk Total Capital
$mApproach
Approach
2
Weighted Assets
Required
1
Credit risk
Corporate78,288 1,087 79,375 6,350
Business lending34,493 993 35,486 2,839
Sovereign2,192 1,354 3,546 284
Bank6,956 51 7,007 561
Residential mortgages131,424 4,714 136,138 10,891
Australian credit cards4,837 - 4,837 387
Other retail11,594 805 12,399 992
Small business16,812 - 16,812 1,345
Specialised lending56,004 503 56,507 4,521
Securitisation5,747 - 5,747 460
Mark-to-market related credit risk
3
- 11,289 11,289 903
Total348,347 20,795 369,142 29,533
Market risk8,396 672
Operational risk54,093 4,327
Interest rate risk in the banking book5,305 424
Other assets
4
6,969 558
Total443,905 35,514



1
Total capital required is calculated as 8% of total risk weighted assets.
2
Westpac’s Standardised risk weighted assets are categorised based on their equivalent IRB categories.
3
Mark-to-market related credit risk is measured under the standardised approach. It is also known as Credit Valuation
Adjustment (CVA) risk.
4
Other assets include cash items, unsettled transactions, fixed assets and other non-interest earning assets.

Pillar 3 report
Capital overview

Westpac Group June 2020 Pillar 3 Report | 11
30 June 2019
IRBStandardisedTotal Risk Total Capital
$mApproach
Approach
2
Weighted Assets
Required
1
Credit risk
Corporate73,728 1,720 75,448 6,036
Business lending35,921 969 36,890 2,951
Sovereign1,899 1,074 2,973 238
Bank7,317 44 7,361 589
Residential mortgages134,702 5,155 139,857 11,189
Australian credit cards5,741 - 5,741 459
Other retail12,898 917 13,815 1,105
Small business16,331 - 16,331 1,307
Specialised lending53,887 446 54,333 4,347
Securitisation5,749 - 5,749 460
Mark-to-market related credit risk
3
- 8,203 8,203 656
Total348,173 18,528 366,701 29,337
Market risk8,037 643
Operational risk41,266 3,301
Interest rate risk in the banking book2,745 220
Other assets
4
3,415 273
Total422,164 33,774




1
Total capital required is calculated as 8% of total risk weighted assets.
2
Westpac’s Standardised risk weighted assets are categorised based on their equivalent IRB categories.
3
Mark-to-market related credit risk is measured under the standardised approach. It is also known as Credit Valuation
Adjustment (CVA) risk.
4
Other assets include cash items, unsettled transactions, fixed assets and other non-interest earning assets.

Pillar 3 report
Leverage ratio disclosure

12 | Westpac Group June 2020 Pillar 3 Report
Leverage ratio
The following table summarises Westpac’s leverage ratio. This has been determined using APRA’s
definition of the leverage ratio as specified in APS110 Capital Adequacy.
$ billion30 June 202031 March 202031 December 201930 September 2019
Tier 1 Capital57.9 57.5 56.8 55.1
Total Exposures985.6 1,014.2 948.7 968.8
Leverage ratio5.9%5.7%6.0%5.7%

Pillar 3 report
Credit risk exposures

Westpac Group June 2020 Pillar 3 Report | 13
Summary credit risk disclosure12
Regulatory
ExpectedSpecificActual
RiskRegulatoryLoss forProvisions Losses for
30 June 2020
ExposureWeightedExpectednon-defaultedImpairedfor Impairedthe 9 months
$m
at DefaultAssets
Loss
1
exposuresLoansLoansended
Corporate
135,178 76,303 820 580 425 236 (4)
Business lending54,710 37,584 805 538 377 206 55
Sovereign116,800 2,194 1 1 ---
Bank23,919 6,461 7 7 ---
Residential mortgages551,420 134,425 1,898 1,125 379 102 96
Australian credit cards17,649 4,332 269 195 127 75 247
Other retail14,110 10,594 573 359 387 213 196
Small business33,099 17,638 669 393 816 294 55
Specialised Lending64,943 59,114 1,011 790 59 25 1
Securitisation27,135 5,429 -----
Standardised
2
19,306 19,601 --49 20 1
Total1,058,269 373,675 6,053 3,988 2,619 1,171 647
Regulatory
ExpectedSpecificActual
RiskRegulatoryLoss forProvisions Losses for
31 March 2020
ExposureWeightedExpectednon-defaultedImpairedfor Impairedthe 6 months
$m
at DefaultAssets
Loss
1
exposuresLoansLoansended
Corporate
146,529 78,288 787 547 363 232 (4)
Business lending54,428 34,493 669 413 347 195 35
Sovereign127,064 2,192 2 2 ---
Bank26,633 6,956 9 9 ---
Residential mortgages553,866 131,424 1,788 1,229 404 114 67
Australian credit cards18,601 4,837 314 238 123 92 164
Other retail15,223 11,594 601 419 312 218 135
Small business33,181 16,812 557 378 501 183 39
Specialised Lending65,866 56,004 813 583 52 26 1
Securitisation28,097 5,747 -----
Standardised
2
19,616 20,795 --52 19 -
Total1,089,104 369,142 5,540 3,818 2,154 1,079 437
Regulatory
ExpectedSpecificActual
RiskRegulatoryLoss forProvisions Losses for
30 June 2019
ExposureWeightedExpectednon-defaultedImpairedfor Impairedthe 9 months
$m
at DefaultAssets
Loss
1
exposuresLoansLoansended
Corporate
134,686 73,728 554 468 161 75 (5)
Business lending55,274 35,921 646 428 294 160 33
Sovereign80,171 1,899 2 2 ---
Bank26,224 7,317 8 8 ---
Residential mortgages562,101 134,702 1,708 1,139 422 119 87
Australian credit cards18,493 5,741 355 283 116 74 235
Other retail16,375 12,898 619 448 310 169 246
Small business33,429 16,331 504 347 399 164 53
Specialised Lending63,525 53,887 780 554 108 41 11
Securitisation26,169 5,749 -----
Standardised
2
17,255 18,528 --62 17 2
Total1,033,702 366,701 5,176 3,677 1,872 819 662


1
Includes regulatory expected losses for defaulted and non-defaulted exposures.
2
Includes mark-to-market related credit risk.

Pillar 3 report
Credit risk exposures

14 | Westpac Group June 2020 Pillar 3 Report
Exposure at Default by major type
123
30 June 2020
On balance
Total ExposureAverage
$m
sheet Non-market relatedMarket relatedat Default
3 months ended
1
Corporate61,212 60,146 13,820 135,178 140,854
Business lending42,209 12,501 -54,710 54,569
Sovereign103,877 1,675 11,248 116,800 121,932
Bank14,237 2,010 7,672 23,919 25,276
Residential mortgages484,540 66,880 -551,420 552,643
Australian credit cards7,268 10,381 -17,649 18,125
Other retail10,841 3,269 -14,110 14,667
Small business26,023 7,076 -33,099 33,140
Specialised lending53,231 9,652 2,060 64,943 65,405
Securitisation
2
21,554 5,457 124 27,135 27,616
Standardised12,838 1,211 5,257 19,306 19,461
Total837,830 180,258 40,181 1,058,269 1,073,688
31 March 2020
On balance
Total ExposureAverage
$m
sheet Non-market relatedMarket relatedat Default
12 months ended
3
Corporate69,038 57,950 19,541 146,529 140,586
Business lending42,083 12,345 -54,428 54,546
Sovereign119,847 1,857 5,360 127,064 102,570
Bank14,899 2,415 9,319 26,633 27,505
Residential mortgages486,270 67,596 -553,866 555,459
Australian credit cards8,218 10,383 -18,601 18,434
Other retail11,881 3,342 -15,223 15,607
Small business26,181 7,000 -33,181 33,311
Specialised lending54,066 9,750 2,050 65,866 65,739
Securitisation
2
22,690 5,276 131 28,097 27,269
Standardised13,476 1,162 4,978 19,616 19,992
Total868,649 179,076 41,379 1,089,104 1,061,018
30 June 2019
On balance
Total ExposureAverage
$m
sheet Non-market relatedMarket relatedat Default
3 months ended
4
Corporate63,514 59,650 11,522 134,686 135,094
Business lending43,029 12,245 -55,274 54,787
Sovereign76,109 1,518 2,544 80,171 79,872
Bank16,609 2,236 7,379 26,224 25,848
Residential mortgages488,220 73,881 -562,101 560,131
Australian credit cards9,477 9,016 -18,493 18,672
Other retail12,974 3,401 -16,375 16,479
Small business26,622 6,807 -33,429 33,355
Specialised lending51,704 10,503 1,318 63,525 64,153
Securitisation
2
20,619 5,354 196 26,169 26,049
Standardised13,451 1,149 2,655 17,255 17,322
Total822,328 185,760 25,614 1,033,702 1,031,766
Off-balance sheet
Off-balance sheet
Off-balance sheet



1
Average is based on exposures as at 30 June 2020 and 31 March 2020.
2
The EAD associated with securitisations is for the banking book only.
3
Average is based on exposures as at 31 March 2020, 31 December 2019, and 30 September 2019.
4
Average is based on exposures as 30 June 2019 and 31 March 2019.

Pillar 3 report
Credit risk exposures

Westpac Group June 2020 Pillar 3 Report | 15
Loan impairment provisions
APS220 Credit Quality requires that Westpac report specific provisions and a General Reserve for Credit
Loss (GRCL). All Individually Assessed Provisions (IAP) raised under Australian Accounting Standards
(AAS) are classified as specific provisions. All Collectively Assessed Provisions (CAP) raised under AAS
are either classified into specific provisions or a GRCL.
1

30 June 2020
Total Regulatory
$m
IAPs
CAPs
Provisions
Specific Provisions
for impaired loans
607



564



1,171



for defaulted but not impaired loans
NA
860



860



For Stage 2
NA
2,167



2,167



Total Specific Provision
1
607



3,591



4,198



General Reserve for Credit Loss
1
NA
2,172



2,172



Total provisions for ECL
607



5,763



6,370



31 March 2020
Total Regulatory
$m
IAPs
CAPs
Provisions
Specific Provisions
for impaired loans
606



473



1,079



for defaulted but not impaired loans
NA
628



628



For Stage 2
NA
2,184



2,184



Total Specific Provision
1
606



3,285



3,891



General Reserve for Credit Loss
1
NA
1,900



1,900



Total provisions for ECL
606



5,185



5,791



30 June 2019
Total Regulatory
$m
IAPs
CAPs
Provisions
Specific Provisions
for impaired loans
438



381



819



for defaulted but not impaired loans
NA
573



573



For Stage 2
NA
1,281



1,281



Total Specific Provision
1
438



2,235



2,673



General Reserve for Credit Loss
1
NA
1,394



1,394



Total provisions for ECL
438



3,629



4,067



A-IFRS Provisions
A-IFRS Provisions
A-IFRS Provisions


1
Provisions classified according to APRA’s letter dated 4 July 2017 “Provisions for regulatory purposes and AASB 9 financial
instruments”.

Pillar 3 report
Credit risk exposures

16 | Westpac Group June 2020 Pillar 3 Report
Impaired and past due loans
The following tables disclose the crystallisation of credit risk as impairment and loss. Analysis of exposures
defaulted not impaired, impaired loans, related provisions and actual losses is broken down by
concentrations reflecting Westpac’s asset categories.
SpecificSpecific Actual
30 June 2020
DefaultedImpairedProvisions forProvisions to Losses for the
$m
not impaired
1
Loans Impaired LoansImpaired Loans9 months ended
Corporate89 425 236 56%(4)
Business lending568 377 206 55%55
Sovereign-----
Bank-----
Residential mortgages6,692 379 102 27%96
Australian credit cards-127 75 59%247
Other retail2 387 213 55%196
Small business516 816 294 36%55
Specialised lending331 59 25 42%1
Securitisation-----
Standardised105 49 20 41%1
Total8,303 2,619 1,171 45%647
SpecificSpecific Actual
31 March 2020
DefaultedImpairedProvisions forProvisions to Losses for the
$m
not impaired
1
Loans Impaired LoansImpaired Loans12 months ended
Corporate91 363 232 64%(4)
Business lending474 347 195 56%35
Sovereign-----
Bank-----
Residential mortgages4,050 404 114 28%67
Australian credit cards-123 92 75%164
Other retail-312 218 70%135
Small business359 501 183 37%39
Specialised lending357 52 26 50%1
Securitisation-----
Standardised78 52 19 37%-
Total5,409 2,154 1,079 50%437
SpecificSpecific Actual
30 June 2019
DefaultedImpairedProvisions forProvisions to Losses for the
$m
not impaired
1
Loans Impaired LoansImpaired Loans9 months ended
Corporate95 161 75 47%(5)
Business lending423 294 160 54%33
Sovereign-----
Bank-----
Residential mortgages3,872 422 119 28%87
Australian credit cards-116 74 64%235
Other retail-310 169 55%246
Small business331 399 164 41%53
Specialised lending315 108 41 38%11
Securitisation-----
Standardised65 62 17 27%2
Total5,101 1,872 819 44%662


1
Includes items past 90 days not impaired.

Pillar 3 report
Securitisation

Westpac Group June 2020 Pillar 3 Report | 17
Banking book summary of securitisation activity by asset type
For the 3 months ended
30 June 2020
Amount
Recognised gain or
$m
securitised
loss on sale
Residential mortgages
46,347



-
Credit cards
-
-
Auto and equipment finance
-
-
Business lending
-
-
Investments in ABS
-
-
Other
-
-
Total
46,347



-
For the 6 months ended
31 March 2020
Amount
Recognised gain or
$m
securitised
loss on sale
Residential mortgages
19,547



-
Credit cards
-
-
Auto and equipment finance
318



-
Business lending
-
-
Investments in ABS
-
-
Other
-
-
Total
19,865



-
For the 3 months ended
30 June 2019
Amount
Recognised gain or
$m
securitised
loss on sale
Residential mortgages
4,137



-
Credit cards
-
-
Auto and equipment finance
305



-
Business lending
-
-
Investments in ABS
-
-
Other
-
-
Total
4,442



-

Pillar 3 report
Securitisation

18 | Westpac Group June 2020 Pillar 3 Report
Banking book summary of on and off-balance sheet securitisation by exposure type
30 June 2020Off-balanceTotal Exposure
$m
Securitisation retainedSecuritisation purchasedsheetat Default
Securities-8,165 37 8,202
Liquidity facilities--287 287
Funding facilities2,702 -1,049 3,751
Underwriting facilities----
Lending facilities527 -
291
818
Warehouse facilities10,160 -3,917 14,077
Total13,389 8,165 5,581 27,135
31 March 2020Off-balanceTotal Exposure
$m
Securitisation retainedSecuritisation purchasedsheetat Default
Securities-8,583 39 8,622
Liquidity facilities--306 306
Funding facilities3,163 -783 3,946
Underwriting facilities----
Lending facilities536 -
299
835
Warehouse facilities10,408 -3,980 14,388
Total14,107 8,583 5,407 28,097
30 June 2019Off-balanceTotal Exposure
$m
Securitisation retainedSecuritisation purchasedsheetat Default
Securities-8,817 34 8,851
Liquidity facilities--356 356
Funding facilities2,388 -1,483 3,871
Underwriting facilities----
Lending facilities8 -
298
306
Warehouse facilities9,409 -3,376 12,785
Total11,805 8,817 5,547 26,169
On balance sheet
On balance sheet
On balance sheet

Pillar 3 report
Securitisation

Westpac Group June 2020 Pillar 3 Report | 19
Trading book summary of on and off-balance sheet securitisation by exposure type
1

30 June 2020Off-balanceTotal Exposure
$m
Securitisation retainedSecuritisation purchasedsheetat Default
Securities-18 -18
Liquidity facilities----
Funding facilities----
Underwriting facilities----
Lending facilities----
Warehouse facilities----
Credit enhancements----
Basis swaps--109 109
Other derivatives--18 18
Total-18 127 145
31 March 2020Off-balanceTotal Exposure
$m
Securitisation retainedSecuritisation purchasedsheetat Default
Securities-92 -92
Liquidity facilities----
Funding facilities----
Underwriting facilities----
Lending facilities----
Warehouse facilities----
Credit enhancements----
Basis swaps--116 116
Other derivatives--16 16
Total-92 132 224
30 June 2019Off-balanceTotal Exposure
$m
Securitisation retainedSecuritisation purchasedsheetat Default
Securities-14 -14
Liquidity facilities----
Funding facilities----
Underwriting facilities----
Lending facilities----
Warehouse facilities----
Credit enhancements----
Basis swaps--59 59
Other derivatives--13 13
Total-14 72 86
On balance sheet
On balance sheet
On balance sheet




1
EAD associated with trading book securitisation is not included in EAD by major type on page 14. Trading book securitisation
exposure is captured and risk weighted under APS116 Capital Adequacy: Market Risk.

Pillar 3 report
Liquidity Coverage Ratio

20 | Westpac Group June 2020 Pillar 3 Report
Liquidity Coverage Ratio (LCR)
Westpac’s LCR as at 30 June 2020 was 140%
1
(31 March 2020: 154%) and the average LCR for the
quarter was 146%
2
(31 March 2020: 140%).
Liquid assets included in the LCR comprise High Quality Liquid Assets (HQLA), the Committed Liquidity
Facility (CLF) offered by the Reserve Bank of Australia and additional qualifying Reserve Bank of New
Zealand securities. LCR liquid assets also includes Westpac’s Initial Allowance and Additional Allowance of
the Term Funding Facility (TFF) of $21.1 billion.
Westpac’s portfolio of HQLA averaged $112.2 billion over the quarter
2
.
Funding is sourced from retail, small business, corporate and institutional customer deposits and wholesale
funding. Westpac seeks to minimise the outflows associated with this funding by targeting customer
deposits with lower LCR outflow rates and actively manages the maturity profile of its wholesale funding
portfolio. Westpac maintains a buffer over the regulatory minimum of 100%.
Total unweighted
value (average)
2
Total weighted
value (average)
2
Total unweighted
value (average)
2
Total weighted
value (average)
2
Liquid assets, of which:
1High-quality liquid assets (HQLA)112,215 98,611
2Alternative liquid assets (ALA)64,641 46,069
3Reserve Bank of New Zealand (RBNZ) securities8,524 8,238
Cash Outflows
4Retail deposits and deposits from small business
customers, of which:
260,515 23,415 252,779 22,866
5Stable deposits127,633 6,382 121,722 6,086
6Less stable deposits132,882 17,033 131,057 16,780
7Unsecured wholesale funding, of which:163,325 78,824 133,858 65,160
8Operational deposits (all counterparties) and
deposits in networks for cooperative banks
65,410 16,277 53,192 13,224
9Non-operational deposits (all counterparties)86,445 51,077 68,623 39,893
10Unsecured debt11,470 11,470 12,043 12,043
11Secured wholesale funding--
12Additional requirements, of which:197,854 30,143 193,136 28,113
13Outflows related to derivatives exposures and other
collateral requirements
15,071 15,071 12,582 12,582
14Outflows related to loss of funding on debt products546 546 1,269 1,269
15Credit and liquidity facilities182,237 14,526 179,285 14,262
16Other contractual funding obligations324 324 526 526
17Other contingent funding obligations38,670 3,331 42,212 3,642
18Total cash outflows136,037 120,307
Cash inflows
19Secured lending (e.g. reverse repos)5,906 -6,381 -
20Inflows from fully performing exposures10,458 6,216 11,675 7,057
21Other cash inflows2,791 2,791 4,282 4,282
22Total cash inflows19,155 9,007 22,338 11,339
23Total liquid assets185,380 152,918
24Total net cash outflows127,030 108,968
25Liquidity Coverage Ratio (%)146%140%
Number of data points used6364
$m
31 March 202030 June 2020

1
Calculated as total liquid assets divided by total net cash outflows.
2
Calculated as a simple average of the daily observations over the quarter.

Pillar 3 report
Appendix I - APS330 quantitative requirements

Westpac Group June 2020 Pillar 3 Report | 21
The following table cross-references the quantitative disclosure requirements outlined in Attachment C of
APS330 to the quantitative disclosures made in this report.
APS330 reference
• Westpac disclosure
Page
General Requirements
Paragraph 49 Summary leverage ratio 12

Attachment C

Table 3:
Capital Adequacy
(a) to (e)
(f)
Capital requirements
Westpac’s capital adequacy ratios
Capital adequacy ratios of major subsidiary banks
10
8
8

Table 4:
Credit Risk - general
disclosures
(a)
(b)
(c)
Exposure at Default by major type
Impaired and past due loans
General reserve for credit loss

14
16
15

Table 5:
Securitisation exposures
(a)

(b)

Banking Book summary of securitisation activity by asset type
Banking Book summary of on and off-balance sheet
securitisation by exposure type
Trading Book summary of on and off-balance sheet
securitisation by exposure type

17

18

19

Attachment F

Table 20: Liquidity
Coverage Ratio disclosure
template
Liquidity Coverage Ratio disclosure 20




Exchange rates
The following exchange rates were used in this report, and reflect spot rates for the period end.

$30 June 202031 March 202030 June 2019
USD0.6856 0.6191 0.7014
GBP0.5584 0.5017 0.5534
NZD1.0698 1.0264 1.0461
EUR0.6114 0.5620 0.6168

Pillar 3 report
Disclosure regarding forward-looking statements

22 | Westpac Group June 2020 Pillar 3 Report
This report contains statements that constitute ‘forward-looking statements’ within the meaning of Section 21E of
the US Securities Exchange Act of 1934.
Forward-looking statements are statements about matters that are not historical facts. Forward-looking statements
appear in a number of places in this report and include statements regarding Westpac’s intent, belief or current
expectations with respect to its business and operations, market conditions, results of operations and financial
condition, including, without limitation, future loan loss provisions and financial support to certain borrowers. Words
such as ‘will’, ‘may’, ‘expect’, ‘intend’, ‘seek’, ‘would’, ‘should’, ‘could’, ‘continue’, ‘plan’, ‘estimate’, ‘anticipate’,
‘believe’, ‘probability’, ‘risk’, ‘aim’ or other similar words are used to identify forward-looking statements. These
forward-looking statements reflect Westpac’s current views with respect to future events and are subject to
change, certain risks, uncertainties and assumptions which are, in many instances, beyond Westpac’s control, and
have been made based upon management’s expectations and beliefs concerning future developments and their
potential effect upon Westpac. There can be no assurance that future developments will be in accordance with
Westpac’s expectations or that the effect of future developments on Westpac will be those anticipated. Actual
results could differ materially from those expected, depending on the outcome of various factors, including, but not
limited to:
⚫ the effect of the global COVID-19 pandemic, which has had, and is expected to continue to have, a negative
impact on our business and global economic conditions, adversely affect a wide-range of Westpac's
customers, create increased volatility in financial markets and may result in increased impairments, defaults
and write-offs;
⚫ disruptions to our business and operations and to the business and operations of key suppliers, third party
contractors and customers connected with the COVID-19 pandemic;
⚫ the effect of, and changes in, laws, regulations, taxation or accounting standards or practices and government
policy, particularly changes to liquidity, leverage and capital requirements;
⚫ regulatory investigations, reviews, and other actions, inquiries, litigation, fines, penalties, restrictions or other
regulator imposed conditions, including as a result of our actual or alleged failure to comply with laws (such as
financial crime laws), regulations or regulatory policy;
⚫ internal and external events which may adversely impact Westpac's reputation;
⚫ information security breaches, including cyberattacks;
⚫ reliability and security of Westpac's technology and risks associated with changes to technology systems;
⚫ the stability of Australian and international financial systems and disruptions to financial markets and any
losses or business impacts Westpac or its customers or counterparties may experience as a result;
⚫ market volatility, including uncertain conditions in funding, equity and asset markets;
⚫ adverse asset, credit or capital market conditions;
⚫ an increase in defaults in credit exposures because of a deterioration in economic conditions;
⚫ the conduct, behaviour or practices of Westpac or its staff;
⚫ changes to Westpac's credit ratings or to the methodology used by credit rating agencies;
⚫ levels of inflation, interest rates (including low or negative rates), exchange rates and market and monetary
fluctuations;
⚫ market liquidity and investor confidence;
⚫ changes in economic conditions, consumer spending, saving and borrowing habits in Australia, New Zealand
and in other countries (including as a result of tariffs and protectionist trade measures) in which Westpac or its
customers or counterparties conduct their operations and Westpac’s ability to maintain or to increase market
share, margins and fees, and control expenses;
⚫ the effects of competition, including from established providers of financial services and from non-financial
service entities in the geographic and business areas in which Westpac conducts its operations;
⚫ the timely development and acceptance of new products and services and the perceived overall value of these
products and services by customers;
⚫ the effectiveness of Westpac's risk management policies, including internal processes, systems and
employees;
⚫ the incidence or severity of Westpac-insured events;
⚫ the occurrence of environmental change (including as a result of climate change) or external events in
countries in which Westpac or its customers or counterparties conduct their operations;
⚫ changes to the value of Westpac's intangible assets;
⚫ changes in political, social or economic conditions in any of the major markets in which Westpac or its
customers or counterparties operate;
⚫ the success of strategic decisions involving diversification or innovation, in addition to business expansion
activity, business acquisitions and the integration of new businesses; and
⚫ various other factors beyond Westpac's control.

Pillar 3 report
Disclosure regarding forward-looking statements

Westpac Group June 2020 Pillar 3 Report | 23
The above list is not exhaustive. For certain other factors that may impact on forward-looking statements made by
Westpac refer to ‘Risk factors’ in Westpac’s 2020 Interim Financial Results Announcement. When relying on
forward-looking statements to make decisions with respect to Westpac, investors and others should carefully
consider the foregoing factors and other uncertainties and events.
Westpac is under no obligation to update any forward-looking statements contained in this report, whether as a
result of new information, future events or otherwise, after the date of this report.