ANZ NZ Branch DS 30 September 2022

Annual Report14 November 2022ANZFinancials

Australia and New Zealand Banking Group Limited ABN 11 005 357 522
ANZ Centre Melbourne, Level 9A, 833 Collins Street, Docklands VIC 3008

14 November 2022

Market Announcements Office
ASX Limited
Level 4
20 Bridge Street
SYDNEY NSW 2000

Australia and New Zealand Banking Group Limited – ANZ New Zealand Branch
Registered Bank Disclosure Statement

Australia and New Zealand Banking Group Limited (ANZ) today released its ANZ New
Zealand Branch Registered Bank Disclosure Statement for the year ended 30 September
2022.

It has been approved for distribution by ANZ’s Board of Directors.

Yours faithfully

Simon Pordage
Company Secretary
Australia and New Zealand Banking Group Limited

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED
- ANZ NEW ZEALAND
REGISTERED BANK DISCLOSURE STATEMENT

FOR THE YEAR ENDED 30 SEPTEMBER 2022
NUMBER 47 | ISSUED NOVEMBER 2022

2
CONTENTS

Glossary of terms 2

DISCLOSURE STATEMENT

Financial Statements 3
Consolidated financial statements 4
Notes to the financial statements 8

Registered Bank Disclosures 68

Directors’ and New Zealand Chief Executive
Officer’s Statement
88

Independent Auditor’s Report
89

GLOSSARY OF TERMS

In this Registered Bank Disclosure Statement (Disclosure Statement) unless the context otherwise requires:
Bank means ANZ Bank New Zealand Limited.
Banking Group means the Bank and all its controlled entities.
Immediate Parent Company means ANZ Funds Pty Limited, which is the immediate parent company of ANZ Holdings (New Zealand)
Limited.
Ultimate Parent Bank means Australia and New Zealand Banking Group Limited.
Overseas Banking Group means the worldwide operations of Australia and New Zealand Banking Group Limited including its controlled
entities.
New Zealand business means all business, operations, or undertakings conducted in or from New Zealand identified and treated as if it
were conducted by a company formed and registered in New Zealand.
NZ Branch means the New Zealand business of the Ultimate Parent Bank.
ANZ New Zealand, We or Our means the New Zealand business of the Overseas Banking Group.
Registered Office is Level 10, 171 Featherston Street, Wellington, New Zealand, which is also ANZ New Zealand’s address for service.
RBNZ means the Reserve Bank of New Zealand.
APRA means the Australian Prudential Regulation Authority.
the Order means the Registered Bank Disclosure Statements (Overseas Incorporated Registered Banks) Order 2014.
Any term or expression which is defined in, or in the manner prescribed by, the Order shall have the meaning given in or prescribed by
the Order.

3
FINANCIAL
STATEMENTS

Financial statements

Income statement 4

Statement of comprehensive income
4

Balance sheet 5

Cash flow statement
6

Statement of changes in equity 7

Notes to the financial statements

Basis of preparation

Non-financial assets

1. About our financial statements 8 19. Goodwill and other intangible assets 53

Financial performance

Non-financial liabilities

2. Operating income 11 20. Other provisions 56

3. Operating expenses 13

4. Income tax 14
Equity

5. Dividends 15 21. Shareholders' equity 57

6. Segment reporting 15 22. Capital management 59

Financial assets

Consolidation and presentation

7. Cash and cash equivalents 17 23. Controlled entities 60

8. Trading securities 18 24. Structured entities 61

9. Derivative financial instruments 19 25. Transfers of financial assets 63

10. Investment securities 24

11. Net loans and advances 25
Other disclosures

12. Allowance for expected credit losses 26 26. Related party disclosures 63

27. Commitments and contingent liabilities 65

Financial liabilities
28. Auditor fees 67

13. Deposits and other borrowings 32 29. Potential new ultimate holding company 67

14. Debt issuances 33

Financial instrument disclosures

15. Financial risk management 35

16. Fair value of financial assets and financial liabilities 48

17. Assets charged as security for liabilities 51

and collateral accepted as security for assets

18. Offsetting 52

FINANCIAL STATEMENTS

The notes appearing on pages 8 to 67 form an integral part of these financial statements

5
BALANCE SHEET

2022 2021
As at 30 September Note NZ$m NZ$m
Assets

Cash and cash equivalents 7 12,575 7,844
Settlement balances receivable
785
237
Collateral paid 1,672 537
Trading securities 8
7,228
9,585
Derivative financial instruments 9
15,478
9,283
Investment securities 10 11,357 11,926
Net loans and advances 11
147,373
141,074
Investments in associates 23
4
5
Deferred tax assets 4 363 390
Goodwill and other intangible assets 19
3,099
3,091
Premises and equipment 450 509
Other assets
1,055
591
Total assets

201,439
185,072
Liabilities
Settlement balances payable
4,887
2,663
Collateral received
1,962
738
Deposits and other borrowings 13 142,482 135,986
Derivative financial instruments 9
13,571
7,680
Current tax liabilities 315 161
Payables and other liabilities
1,367
1,483
Employee entitlements
128
138
Other provisions 20 222 295
Debt issuances 14
20,483
20,852
Total liabilities (excluding head office account)

185,417
169,996
Net assets (excluding head office account)

16,022
15,076
Equity

Share capital and initial head office account 21 11,055 11,055
Reserves 21
48
70
Retained earnings 21
4,369
3,951
Equity attributable to shareholders of the Ultimate Parent Bank 21 15,472 15,076
Non-controlling interests 21
550
-
Total equity & head office account
21
16,022
15,076

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

FINANCIAL STATEMENTS

The notes appearing on pages 8 to 67 form an integral part of these financial statements

6
CASH FLOW STATEMENT

2022 2021
For the year ended 30 September NZ$m NZ$m
Profit after income tax
2,299 1,919

Adjustments to reconcile to net cash flows from operating activities:
Depreciation and amortisation
125
124
Loss on sale and impairment of premises and equipment
4
7
Net derivatives/foreign exchange adjustment
626 (951)
Other non-cash movements
(38)
150

Net (increase)/decrease in operating assets:

Collateral paid (1,135) 857
Trading securities
2,357
3,212
Net loans and advances
(6,299)
(8,090)
Other assets
(985) 115

Net increase/(decrease) in operating liabilities:
Deposits and other borrowings (excluding items included in financing activities)
4,966
6,761
Settlement balances payable
2,224 (245)
Collateral received
1,224
(537)
Other liabilities
(12)
209
Total adjustments
3,057 1,612
Net cash flows from operating activities
1

5,356
3,531
Cash flows from investing activities

Investment securities:
Purchases
(3,898)
(5,528)
Proceeds from sale or maturity
3,839 2,833
Other assets
(65)
(39)
Net cash flows from investing activities
(124)
(2,734)
Cash flows from financing activities

Deposits and other borrowings (excluding borrowings from Immediate Parent and Ultimate Parent Bank)
2

1,500
1,300
Debt issuances:
3

Issue proceeds

3,452 3,278
Redemptions

(4,028)
(4,899)
Borrowings from Immediate Parent and Ultimate Parent Bank:
4

Loans drawn down

113
151
Repayments

(154)
(140)
Proceeds from issue of preference shares
542 -
Repayment of lease liabilities
(46)
(46)
Dividends paid
(1,880)
(845)
Net cash flows from financing activities
(501)
(1,201)
Net change in cash and cash equivalents
4,731
(404)
Cash and cash equivalents at beginning of year 7,844 8,248
Cash and cash equivalents at end of year

12,575
7,844
1 Net cash provided by operating activities includes income taxes paid of NZ$700 million (2021: NZ$871 million).
2 Movement in deposits and other borrowings includes repurchase transactions entered into with RBNZ under the Funding for Lending Programme of NZ$1,500 million (2021: NZ$1,000
million under the Funding for Lending Programme and NZ$300 million under the Term Lending Facility).
3 Movement in debt issuances (Note 14 debt issuances) also includes a NZ$1,739 million increase (2021: NZ$998 million decrease) from the effect of foreign exchange rates, a NZ$1,550
million decrease (2021: NZ$398 million decrease) from changes in fair value hedging instruments and an NZ$18 million increase (2021: NZ$42 million increase) from other changes.
4 Movement in borrowings from Immediate Parent and Ultimate Parent Bank (Note 13 deposit and other borrowings) also includes a NZ$194 million increase (2021: NZ$41 million decrease)
from the effect of foreign exchange rates, a NZ$124 million decrease (2021: NZ$44 million decrease) from changes in fair value hedging instruments and a NZ$1 million increase (2021:
NZ$2 million increase) of other changes.

FINANCIAL STATEMENTS
The notes appearing on pages 8 to 67 form an integral part of these financial statements
7
STATEMENT OF CHANGES IN EQUITY
Share capital
and initial
head
office
account Reserves
Retained
earnings
Equity
attributable
to
shareholders
of the
Ultimate
Parent Bank
Non-
controlling
interests
Total
shareholders'
equity
NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m
As at 1 October 2020 11,055 118 2,837 14,010 - 14,010
Profit for the year - - 1,919 1,919 - 1,919
Other comprehensive income for the year
- (48) 40 (8) - (8)
Total comprehensive income for the year
- (48) 1,959 1,911 - 1,911
Transactions with equity holders in their
capacity as equity owners:
Ordinary dividends paid - - (845) (845) - (845)
As at 30 September 2021
11,055 70 3,951 15,076 - 15,076
Profit for the year
- - 2,299 2,299 -2,299
Other comprehensive income for the year -(22)7 (15)-(15)
Total comprehensive income for the year -(22)2,306 2,284 -2,284
Transactions with equity holders in their
capacity as equity owners:
Ordinary dividends paid - - (1,880) (1,880) -(1,880)
Preference shares issued (net of issue costs)
- - (8) (8)550542
As at 30 September 2022 11,055 48 4,369 15,472 550 16,022

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

NOTES TO THE FINANCIAL STATEMENTS

8
1. ABOUT OUR FINANCIAL STATEMENTS
These are the financial statements for ANZ New Zealand for the year ended 30 September 2022. The Ultimate Parent Bank is incorporated in Australia
and is also registered in New Zealand (NZ Branch). The NZ Branch is domiciled in New Zealand, and the address of the NZ Branch’s registered office
and its principal place of business is Level 10, 171 Featherston Street, Wellington, New Zealand.
On 11 November 2022, the Directors resolved to authorise the issue of these financial statements.
Information in the financial statements is included only to the extent we consider it material and relevant to the understanding of the financial
statements. A disclosure is considered material and relevant if, for example:
• the amount is significant in size (quantitative factor);
• the information is significant by nature (qualitative factor);
• the user cannot understand ANZ New Zealand’s results without the specific disclosure (qualitative factor);
• the information is critical to a user’s understanding of the impact of significant changes in ANZ New Zealand’s business during the period – for
example: business acquisitions or disposals (qualitative factor);
• the information relates to an aspect of ANZ New Zealand’s operations that is important to its future performance (qualitative factor); or
• the information is required under legislative requirements of the Financial Markets Conduct Act 2013 or by ANZ New Zealand’s principal
regulator, RBNZ.
This section of the financial statements:
• outlines the basis upon which ANZ New Zealand’s financial statements have been prepared; and
• discusses any new accounting standards or regulations that directly impact the financial statements.
BASIS OF PREPARATION
These financial statements are general purpose (Tier 1) financial statements prepared by a ‘for profit’ entity, in accordance with the requirements of
the Financial Markets Conduct Act 2013. These financial statements comply with:
• New Zealand Generally Accepted Accounting Practice (NZ GAAP), as defined in the Financial Reporting Act 2013;
• New Zealand equivalents to International Financial Reporting Standards (NZ IFRS) and other applicable Financial Reporting Standards, as
appropriate for publicly accountable for-profit entities; and
• International Financial Reporting Standards (IFRS).
We present the financial statements of ANZ New Zealand in New Zealand dollars, which is ANZ New Zealand’s functional and presentation currency.
We have rounded values to the nearest million dollars (NZ$m), unless otherwise stated.
BASIS OF MEASUREMENT
We have prepared the financial information in accordance with the historical cost basis - except for the following assets and liabilities which we have
stated at their fair value:
• derivative financial instruments;
• financial instruments measured at fair value through other comprehensive income (FVOCI); and
• financial instruments measured at fair value through profit and loss.
BASIS OF CONSOLIDATION
The consolidated financial statements of ANZ New Zealand comprise the financial statements of the NZ Branch and all of the New Zealand businesses
of all the subsidiaries of the Ultimate Parent Bank. An entity, including a structured entity, is considered a subsidiary of ANZ New Zealand when we
determine that ANZ New Zealand has control over the entity. Control exists when ANZ New Zealand is exposed to, or has rights to, variable returns
from its involvement with the entity and has the ability to affect those returns through its power over the entity. We assess power by examining
existing rights that give ANZ New Zealand the current ability to direct the relevant activities of the entity. We have eliminated, on consolidation, the
effect of all transactions between entities in ANZ New Zealand.
FOREIGN CURRENCY TRANSLATION
TRANSACTIONS AND BALANCES
Foreign currency transactions are translated into the relevant functional currency at the exchange rate prevailing at the date of the transaction. At the
reporting date, monetary assets and liabilities denominated in foreign currencies are translated into the functional currency at the relevant spot rate.
Any foreign currency translation gains or losses that arise are included in profit or loss in the period they arise.
We measure translation differences on non-monetary items at fair value through profit or loss and report them as part of the fair value gain or loss on
these items. For non-monetary items classified as investment securities measured at FVOCI, translation differences are included in other
comprehensive income.
FIDUCIARY ACTIVITIES
ANZ New Zealand provides fiduciary services to third parties including custody, nominee and trustee services. This involves ANZ New Zealand holding
assets on behalf of third parties and making decisions regarding the purchase and sale of financial instruments. If ANZ New Zealand is not the
beneficial owner or does not control the assets, then we do not recognise these transactions in these financial statements, except when required by
accounting standards or another legislative requirement.

NOTES TO THE FINANCIAL STATEMENTS

9

1. ABOUT OUR FINANCIAL STATEMENTS (continued)

KEY JUDGEMENTS AND ESTIMATES
In the process of applying ANZ New Zealand’s accounting policies, management has made a number of judgements and applied estimates
and assumptions about past and future events. Further information on the key judgements and estimates that we consider material to the
financial statements are contained within each relevant note to the financial statements.
Whilst the course of the COVID-19 pandemic is moderating and the management of its impact on the populace, businesses and economic
activity is better understood, the responses of consumers, business and governments remain uncertain. Compounding the effects of the
pandemic are mounting geopolitical tensions, global supply chain disruptions, the conflict in Ukraine, commodity price pressures, and
increasing inflation and interest rates impacting the economy. Thus, there remains an elevated level of estimation uncertainty involved in the
preparation of these financial statements.
ANZ New Zealand has made various accounting estimates in these financial statements based on forecasts of economic conditions which
reflect expectations and assumptions at 30 September 2022 about future events considered reasonable in the circumstances. There is a
considerable degree of judgement involved in preparing these estimates. Actual economic conditions are likely to be different from those
forecast since anticipated events frequently do not occur as expected, and the effect of these differences may significantly impact
accounting estimates included in these financial statements. The significant accounting estimates impacted by these forecasts and
associated uncertainties are predominantly related to expected credit losses and recoverable amounts of non-financial assets.
The impact of these uncertainties on each of these accounting estimates is discussed further in the relevant notes of these financial
statements. Readers should consider these disclosures in light of the inherent uncertainties described above.

INTEREST RATE BENCHMARK REFORM
Interbank offered rates (IBORs) have played a critical role in global financial markets, serving as reference rates for derivatives, loans and securities, and
in the valuation of financial instruments. The IBOR reforms have a wide-ranging impact for ANZ New Zealand and our customers given the
fundamental differences between IBORs and risk-free rates (RFRs). The key difference between IBORs and RFRs is that IBOR rates include a term and
bank credit risk premium, whereas RFRs do not. As a result of these differences, adjustments are required to an RFR to ensure contracts referencing an
IBOR rate transition on an economically comparable basis.
Update on ANZ New Zealand’s approach to interest rate benchmark reform
In line with the regulatory announcements made in 2021, the majority of IBOR rates, including Pound Sterling (GBP), Euro (EUR), Swiss Franc (CHF),
Japanese Yen (JPY), and the US Dollar (USD) 1-week and 2-month LIBOR rate settings ceased on 31 December 2021 and have been replaced by
alternative RFRs. This transition had an immaterial impact to ANZ New Zealand’s profit and loss. Through its loan and derivative transactions with
customers, issuance of debt and its asset and liability management activities ANZ New Zealand continues to have exposure to the remaining US dollar
LIBOR settings and other IBOR-related benchmarks that are due to largely cease by 30 June 2023.
ANZ New Zealand continues to manage the transition from the remaining US dollar LIBOR tenors and other remaining IBOR settings to RFRs through a
Benchmark Transition Programme (the programme). The programme is responsible for managing the risks associated with the transition including
operational, market, legal, conduct and financial reporting risks that may arise.
Exposures subject to benchmark reform as at 30 September 2022
The table below shows ANZ New Zealand’s exposures to interest rate benchmarks subject to IBOR reform. These are financial instruments that
contractually reference an IBOR benchmark planned to transition to an RFR, and have a contractual maturity date beyond the planned IBOR cessation
date.

US dollar LIBOR
As at 30 September 2022

NZ$m
Loan and advances
1

39
Derivative asset (notional value)
2

74,015
Derivative liability (notional value)
2

73,196
Loan commitments
1,3

169
1 Excludes expected credit losses (ECL).
2 For cross-currency swaps, where both the receive and pay legs are in currencies subject to reform, ANZ New Zealand discloses the New Zealand dollar-equivalent notional amounts for both. Where
one leg of a swap is subject to reform, ANZ New Zealand discloses the notional amount of the receive leg.
3 For multi-currency IBOR referenced facilities, the undrawn balance has been allocated to the pricing currency of the facility or where there are multiple pricing currencies impacted by cessation, the
most likely currency of drawdown.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

NOTES TO THE FINANCIAL STATEMENTS

10
1. ABOUT OUR FINANCIAL STATEMENTS (continued)
Hedge accounting exposures subject to IBOR reform
ANZ New Zealand has hedge-accounted relationships referencing US dollar LIBOR, primarily due to ANZ New Zealand’s fixed rate debt issuances
denominated in US dollars that are designated in fair value hedge accounting relationships. The table below details the carrying values of ANZ New
Zealand's US dollar exposures designated in hedge accounting relationships referencing LIBOR that will be impacted by reform. The nominal value of
the associated hedging instruments is also included:

As at 30 September 2022
Hedged items NZ$m
Deposits and other borrowings
1,036
Debt issuances
6,950

Notional designated up to
30 June 2023
Notional designated
beyond 30 June 2023
Total notional amount
Hedging instruments NZ$m NZ$m NZ$m
Fair value hedges 1,312 7,347 8,659
ACCOUNTING STANDARDS ADOPTED IN THE PERIOD
There were no new accounting standards or interpretations adopted in 2022 that had a significant effect on ANZ New Zealand. Accounting policies
have been consistently applied unless otherwise noted.
ACCOUNTING STANDARDS NOT EARLY ADOPTED
A number of new standards, amendments to standards and interpretations have been published but are not mandatory for the financial statements
for the year ended 30 September 2022, and have not been applied by ANZ New Zealand in preparing these financial statements. Further details of
these are set out below.
GENERAL HEDGE ACCOUNTING
NZ IFRS 9 Financial Instruments (NZ IFRS 9) introduces new hedge accounting requirements which more closely align accounting with risk
management activities undertaken when hedging both financial and non-financial risks. NZ IFRS 9 provides ANZ New Zealand with an accounting
policy choice to continue to apply the NZ IAS 39 Financial Instruments: Recognition and Measurement (NZ IAS 39) hedge accounting requirements until
the IASB’s ongoing project on macro hedge accounting is completed. ANZ New Zealand continues to apply the hedge accounting requirements of
NZ IAS 39.
DEFERRED TAX RELATED TO ASSETS AND LIABILITIES ARISING FROM A SINGLE TRANSACTION
Amendments to New Zealand Accounting Standards – Deferred Tax related to Assets and Liabilities arising from a Single Transaction amends NZ IAS 12
Income Taxes and clarifies that entities are required to recognise deferred tax on transactions for which there is both an asset and a liability and that
give rise to equal taxable and deductible temporary differences. This may include transactions such as leases and decommissioning or restoration
obligations. This amendment is effective for ANZ New Zealand from 1 October 2023 and is not expected to have a significant impact.

NOTES TO THE FINANCIAL STATEMENTS

11
2. OPERATING INCOME
2022 2021
NZ$m NZ$m
Net interest income

Interest income by type of financial asset

Financial assets at amortised cost

5,502 4,363
Trading securities 149 106
Investment securities
173
139
Interest income 5,824
4,608
Interest expense by type of financial liability

Financial liabilities at amortised cost
(1,954)
(1,175)
Financial liabilities designated at fair value through profit or loss

(108)
(28)
Interest expense (2,062) (1,203)
Net interest income 3,762 3,405

Other operating income
(i) Fee and commission income

Lending fees
25
30
Non-lending fees
731
678
Commissions

32
35
Funds management income

253 271
Fee and commission income

1,041 1,014
Fee and commission expense

(502) (459)
Net fee and commission income 539
555
(ii) Other income

Net foreign exchange earnings and other financial instruments income
1

555
175
Sale of legacy insurance portfolio
2

-
14
Release of provisions for UDC Finance Ltd and Paymark Ltd disposal costs

14
-
Other

10 16
Other income

579 205
Other operating income 1,118 760

Share of associates' loss (1)
(1)
Operating income

4,879
4,164
1 Includes fair value movements (excluding realised and accrued interest) on derivatives not designated as accounting hedges entered into to manage interest rate and foreign exchange
risk, ineffective portions of cash flow hedges, and fair value movements in financial assets and liabilities designated at fair value through profit or loss.
2 The Bank sold and transferred its rights and obligations relating to servicing a legacy portfolio of insurance underwritten by Tower Limited (Tower) to Tower in March 2021.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

NOTES TO THE FINANCIAL STATEMENTS

12

2. OPERATING INCOME (continued)
RECOGNITION AND MEASUREMENT
NET INTEREST INCOME
Interest income and expense
We recognise interest income and expense in net interest income for all financial instruments, including those classified as held for trading,
assets measured at FVOCI
and at fair value through profit or loss. We use the effective interest rate method to calculate the amortised cost of
assets held at amortised cost and to recognise interest income on financial assets measured at FVOCI. The effective interest rate is the rate that
discounts the stream of estimated future cash receipts or payments over the expected life of the financial instrument or, when appropriate, a
shorter period, to the net carrying amount of
the financial asset or liability. For assets subject to prepayment, we determine their expected life
on the basis of historical behaviour of the particular asset portfolio - taking into account contractual obligations and prepayment experience.
We recognise fees and costs, which form an integral part of the financial instrument (for example loan origination fees and costs), using the
effective interest rate method. These are presented as part of interest income or expense depending on whether the underlying financial
instrument is a financial asset or financial liability.
OTHER OPERATING INCOME
Fee and commission income
We recognise fee and commission revenue arising from contracts with customers (a) over time when the performance obligation is satisfied across
more than one reporting period or (b) at a point in time when the performance obligation is satisfied immediately or is satisfied within one reporting
period.
• lending fees exclude fees treated as part of the effective yield calculation of interest income. Lending fees include certain guarantee and
commitment fees where the loan or guarantee is not likely to be drawn upon, and other fees charged for providing customers a distinct good
or service that are recognised separately from the underlying lending product.
• non-lending fees include fees associated with deposit and credit card accounts, interchange fees and fees charged for specific customer
transactions such as international money transfers. Where ANZ New Zealand provides multiple goods or services to a customer under the
same contract, ANZ New Zealand allocates the transaction price of the contract to distinct performance obligations based on the relative
stand-alone selling price of each performance obligation. Revenue is recognised as each performance obligation is satisfied.
• commissions represent fees from third parties where we act as an agent by arranging a third party (such as an insurance provider) to provide
goods and services to a customer. In such cases, we are not primarily responsible for providing the underlying good or service to the
customer. If ANZ New Zealand collects funds on behalf of a third party when acting as an agent, we only recognise the net commission it
retains as revenue. When the commission is variable based on factors outside our control (such as a trail commission), revenue is only
recognised if it is highly probable that a significant reversal of the variable amount will not be required in future periods.
• funds management income represents fees earned from customers for providing financial advice and fees for asset management services and
advice provided to investment funds. Revenue is recognised either at the point the financial advice is provided or over the period in which the
asset management services are delivered.
Net foreign exchange earnings and other financial instruments income
We recognise the following as net foreign exchange earnings and other financial instruments income:
• exchange rate differences arising on the settlement of monetary items and translation differences on monetary items translated at rates
different to those at which they were initially recognised;
• fair value movements (excluding realised and accrued interest) on derivatives that we use to manage interest rate and foreign exchange risk
on funding instruments not designated as accounting hedges;
• the ineffective portions of fair value hedges and cash flow hedges;
• immediately upon sale or repayment of a hedged item, the unamortised fair value adjustments to items designated as fair value hedges and
amounts accumulated in equity related to designated cash flow hedges;
• fair value movements on financial assets and financial liabilities designated at fair value through profit or loss or held for trading;
• amounts released from the FVOCI reserve when a debt instrument classified as FVOCI is sold; and
• the gain or loss on derecognition of financial assets or liabilities measured at amortised cost.
SHARE OF ASSOCIATES’ PROFIT / (LOSS)
The equity method is applied to accounting for associates. Under the equity method, ANZ New Zealand’s share of the after tax results of associates is
included in the income statement and the statement of comprehensive income.

NOTES TO THE FINANCIAL STATEMENTS

13

3. OPERATING EXPENSES
2022 2021
NZ$m NZ$m
Personnel

Salaries and related costs 947 891
Superannuation costs 30 29
Other 19 15
Personnel

996
935
Premises

Rent
16
18
Depreciation
81
79
Other
38
37
Premises 135 134
Technology
Depreciation and amortisation 44 45
Subscription licences and outsourced services
157
140
Other
27
36
Technology

228
221
Other

Advertising and public relations
37
43
Professional fees 64 58
Freight, stationery, postage and communication 41 42
Charges from the Overseas Banking Group 107 120
Other
46
69
Other

295
332
Operating expenses

1,654
1,622

RECOGNITION AND MEASUREMENT
OPERATING EXPENSES
Operating expenses are recognised as services are provided to ANZ New Zealand, over the period in which an asset is consumed, or once a liability is
created.
SALARIES AND RELATED COSTS – ANNUAL LEAVE, LONG SERVICE LEAVE AND OTHER EMPLOYEE BENEFITS
Wages and salaries, annual leave, and other employee entitlements expected to be paid or settled within twelve months of employees rendering
service are measured at their nominal amounts using remuneration rates that ANZ New Zealand expects to pay when the liabilities are settled.
We accrue employee entitlements relating to long service leave using an actuarial calculation. It includes assumptions regarding staff departures,
leave utilisation and future salary increases. The result is then discounted using market yields at the reporting date. The market yields are determined
from a blended rate of government bonds with terms to maturity that closely match the estimated future cash outflows.
If we expect to pay short term cash bonuses, then a liability is recognised when ANZ New Zealand has a present legal or constructive obligation to
pay this amount (as a result of past service provided by the employee) and the obligation can be reliably measured.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

NOTES TO THE FINANCIAL STATEMENTS

14

4. INCOME TAX
INCOME TAX EXPENSE
Reconciliation of the prima facie income tax expense on pre-tax profit with the income tax expense recognised in profit or loss:
2022 2021
NZ$m NZ$m
Profit before income tax

3,186
2,657
Prima facie income tax expense at 28%
892
744
Tax effect of permanent differences:
Sale of legacy insurance portfolio - (4)
Tax provisions no longer required (3) (3)
Non-assessable income and non-deductible expenditure
(2)
5
Subtotal

887
742
Income tax over provided in previous years
-
(4)
Income tax expense

887
738
Current tax expense
930
762
Adjustments recognised in the current year in relation to the current tax of prior years (63) (4)
Deferred tax expense/(income) relating to the origination and reversal of temporary differences 20 (20)
Income tax expense 887
738
Effective tax rate

27.8%
27.8%

RECOGNITION AND MEASUREMENT
INCOME TAX EXPENSE
Income tax expense comprises both current and deferred taxes and is based on the accounting profit adjusted for differences in the accounting and
tax treatments of income and expenses (that is, taxable income). We recognise tax expense in profit or loss except when the tax relates to items
recognised directly in equity and other comprehensive income, in which case we recognise the tax directly in equity or other comprehensive
income respectively.
CURRENT TAX EXPENSE
Current tax is the tax we expect to pay on taxable income for the year, based on tax rates (and tax laws) which are enacted at the reporting date. We
recognise current tax as a liability (or asset) to the extent that it is unpaid (or refundable).
DEFERRED TAX ASSETS AND LIABILITIES
We account for deferred tax using the balance sheet method. Deferred tax arises because the accounting income is not always the same as the
taxable income. This creates temporary differences, which usually reverse over time. Until they reverse, we recognise a deferred tax asset, or liability,
on the balance sheet. We measure deferred taxes at the tax rates that we expect will apply to the period(s) when the asset is realised, or the liability
settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date.
We offset current and deferred tax assets and liabilities only to the extent that:
• they relate to income taxes imposed by the same taxation authority;
• there is a legal right and intention to settle on a net basis; and
• it is allowed under the tax law of the relevant jurisdiction.

NOTES TO THE FINANCIAL STATEMENTS

15
5. DIVIDENDS
ORDINARY SHARE DIVIDENDS

Amount
per share
Total
dividend
NZ$m
Dividends

Financial Year 2021

Dividend paid in June 2021 223.5 cents 845
Dividends paid during the year ended 30 September 2021

845
Financial Year 2022

Dividend paid in March 2022
232.7 cents 880
Dividend paid in September 2022
264.4 cents 1,000
Dividends paid during the year ended 30 September 2022
1,880

IMPUTATION CREDIT ACCOUNT

ANZ New Zealand Bank
1

2022 2021 2022 2021

NZ$m NZ$m NZ$m NZ$m
Imputation credits available as at 30 September
8,106
7,221
8,106
7,221
Effect of changes to imputation groups
-
-
(7,672)
-
Imputation credits available as at 1 October
8,106
7,221
434
7,221
1 Imputation credits available to the Bank are shown separately as this is relevant for holders of perpetual preference shares (PPS, refer to Note 21 shareholders’ equity) issued by the Bank.
A number of companies within ANZ New Zealand are members of the New Zealand resident imputation group. The imputation credit balance for
ANZ New Zealand includes the imputation credit balance in relation to both the New Zealand resident imputation group and other companies within
ANZ New Zealand that are not in the New Zealand resident imputation group. The imputation credit balance available includes imputation credits
that will arise from the payment of the amount of provision for income tax as at the reporting date.
The Bank, including other entities in the same income tax consolidated group as the Bank (Bank consolidated imputation group) exited the New
Zealand resident imputation group from 1 October 2022. The imputation credit balance available to the Bank consolidated imputation group includes
imputation credits that will arise from the payment of the amount of provision for income tax as at the reporting date.

6. SEGMENT REPORTING
DESCRIPTION OF SEGMENTS
ANZ New Zealand is organised into three major business segments for segment reporting purposes - Personal, Business and Institutional. Centralised
back office and corporate functions support these segments. These segments are consistent with internal reporting provided to the chief operating
decision maker, being the Bank’s Chief Executive Officer.
During the year ended 30 September 2021, ANZ New Zealand reorganised into the following business segments: Personal (comprising the Personal
and Funds Management business units), Business, and Institutional. These are intended to better align ANZ New Zealand’s internal business with the
needs of its primary customer groups, home owners and business owners. These changes were implemented from August 2021 and have been
accounted for prospectively. During the year ended 30 September 2022, there were net movements of approximately NZ$2.1 billion of loans and
advances and NZ$1.6 billion of customer deposits from Business to Personal. Comparative amounts have not been restated because the overall
impact on the financial performance and financial position of the affected segments, Personal and Business, is not considered material.
Personal
Personal provides a full range of banking and wealth management services to consumer and private banking customers. We deliver our services via
our internet and app-based digital solutions and a network of branches, mortgage specialists, relationship managers and contact centres.
Business
Business provides a full range of banking services including small business banking, through our digital, branch and contact centre channels, and
traditional relationship banking and sophisticated financial solutions through dedicated managers. These cover privately owned small, medium and
large enterprises, the agricultural business segment, government and government related entities.
Institutional
The Institutional division services governments, global institutional and corporate customers via the following business units:
• Transaction Banking provides customers with working capital and liquidity solutions including documentary trade, supply chain financing,
commodity financing as well as cash management solutions, deposits, payments and clearing.
• Corporate Finance provides customers with loan products, loan syndication, specialised loan structuring and execution, project and export
finance, debt structuring and acquisition finance and corporate advisory services.
• Markets provides customers with risk management services on foreign exchange, interest rates, credit, commodities and debt capital markets in
addition to managing ANZ New Zealand’s interest rate exposure and high quality liquid asset portfolio.
Other
Other includes treasury and back office support functions, none of which constitutes a separately reportable segment.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

NOTES TO THE FINANCIAL STATEMENTS

16
6. SEGMENT REPORTING (continued)
OPERATING SEGMENTS
Personal Business Institutional Other Total
For the year
2022 2021 2022 2021 2022 2021 2022 2021 2022 2021
ended 30 September NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m
Net interest income
2,220
1,995
1,206
1,064
308
334
28
12
3,762
3,405
Net fee and commission income
- Lending fees
7
9
1
3
17
18
-
-
25
30
- Non-lending fees
426
612
249
10
56
56
-
-
731
678
- Commissions 31 34 - - 1 1 - - 32 35
- Funds management income
253
271
-
-
-
-
-
-
253
271
- Fee and commission expense
(306)
(459)
(196)
-
-
-
-
-
(502)
(459)
Net fee and commission income
411
467
54
13
74
75
-
-
539
555
Other income
3
19
(1)
-
185
160
392
26
579
205
Share of associates' loss - - - - - - (1) (1) (1) (1)
Other operating income
414
486
53
13
259
235
391
25
1,117
759
Operating income
2,634
2,481
1,259
1,077
567
569
419
37
4,879
4,164
Operating expenses (1,165) (1,147) (263) (262) (193) (185) (33) (28) (1,654) (1,622)
Profit before credit impairment
and income tax
1,469
1,334
996
815
374
384
386
9
3,225
2,542
Credit impairment release /
(charge)
(74)
19
35
62
-
34
-
-
(39)
115
Profit before income tax 1,395
1,353
1,031
877
374
418
386
9
3,186
2,657
Income tax expense (391) (375) (289) (246) (105) (117) (102) - (887) (738)
Profit after income tax 1,004
978
742
631
269
301
284
9
2,299
1,919
Financial position
Goodwill
1,042
1,042
895
895
1,069
1,069
-
-
3,006
3,006
Net loans and advances
103,015
95,379
37,431
39,158
6,927
6,535
-
2
147,373
141,074
Customer deposits 85,391 78,592 22,566 23,744 22,373 22,793 - - 130,330 125,129

OTHER SEGMENT
The Other segment profit after income tax comprises:

2022 2021
For the year ended 30 September

NZ$m NZ$m
Personal and Business central functions
22
(2)
Group Centre 27 (1)
Economic hedges 235 12
Total 284 9

NOTES TO THE FINANCIAL STATEMENTS

17

FINANCIAL ASSETS
Outlined below is a description of how we classify and measure financial assets as they apply to subsequent note disclosures.

CLASSIFICATION AND MEASUREMENT
Financial assets - general
There are three measurement classifications for financial assets under NZ IFRS 9: amortised cost, fair value through profit or loss (FVTPL) and fair value
through other comprehensive income (FVOCI). Financial assets are classified into these measurement classifications on the basis of two criteria:
• the business model within which the financial asset is managed; and
• the contractual cash flow characteristics of the financial asset (specifically whether the contractual cash flows represent solely payments of
principal and interest).
The resultant financial asset classifications are as follows:
• Amortised cost: financial assets with contractual cash flows that comprise solely payments of principal and interest and which are held in a
business model whose objective is to collect their cash flows;
• FVOCI: financial assets with contractual cash flows that comprise solely payments of principal and interest and which are held in a business
model whose objective is to collect their cash flows or to sell the assets; and
• FVTPL: any other financial assets not falling into the categories above are measured at FVTPL.
Fair value option for financial assets
A financial asset may be irrevocably designated on initial recognition:
• at FVTPL when the designation eliminates or significantly reduces an accounting mismatch that would otherwise arise; or
• at FVOCI for investments in equity securities, where that instrument is neither held for trading nor contingent consideration recognised by an
acquirer in a business combination.

7. CASH AND CASH EQUIVALENTS
Cash and cash equivalents comprise cash on hand and other balances, as outlined below, that are convertible into cash with an insignificant risk of
changes in value and with remaining maturities of three months or less, including reverse repurchase agreements.

2022 2021
NZ$m NZ$m
Coins, notes and cash at bank
154
163
Securities purchased under agreements to resell in less than 3 months
1,248
610
Balances with central banks
9,980
6,697
Settlement balances receivable within 3 months
1,193
374
Cash and cash equivalents 12,575
7,844

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

NOTES TO THE FINANCIAL STATEMENTS

18

8. TRADING SECURITIES

2022 2021
NZ$m NZ$m
Government securities
6,051
7,985
Corporate and financial institution securities
1,177
1,600
Trading securities 7,228 9,585

RECOGNITION AND MEASUREMENT
Trading securities are financial instruments we either:
• acquire principally for the purpose of selling in the short-term; or
• hold as part of a portfolio we manage for short-term profit making.
We recognise purchases and sales of trading securities on trade date:
• initially, we measure them at fair value; and
• subsequently, we measure them in the balance sheet at their fair value with any change in fair value recognised in profit or loss.

KEY JUDGEMENTS AND ESTIMATES
Judgement is required when applying the valuation techniques used to determine the fair value of trading securities not valued using
quoted market prices. Refer to Note 16 fair value of financial assets and financial liabilities for further details.

NOTES TO THE FINANCIAL STATEMENTS

19
9. DERIVATIVE FINANCIAL INSTRUMENTS

Assets Liabilities Assets Liabilities

2022 2022 2021 2021
Fair value NZ$m NZ$m NZ$m NZ$m
Derivative financial instruments - held for trading 14,114 (11,654) 8,441 (6,954)
Derivative financial instruments - designated in hedging relationships 1,364 (1,917) 842 (726)
Derivative financial instruments
15,478 (13,571) 9,283 (7,680)
FEATURES
Derivative financial instruments are contracts:
• whose value is derived from an underlying price index (or other variable) defined in the contract – sometimes the value is derived from more
than one variable;
• that require little or no initial net investment; and
• that are settled at a future date.
Movements in the price of the underlying variables, which cause the value of the contract to fluctuate, are reflected in the fair value of the derivative.
PURPOSE
ANZ New Zealand’s derivative financial instruments have been categorised as follows:
Trading
Derivatives held in order to:
• meet customer needs for managing their own risks.
• manage risks in ANZ New Zealand that are not in a designated hedge accounting relationship (some elements
of balance sheet management).
• undertake market making and positioning activities to generate profits from short-term fluctuations in prices or
margins.
Designated in hedging
relationships
Derivatives designated into hedge accounting relationships in order to minimise profit or loss volatility by matching
movements in underlying positions relating to:
• hedges of ANZ New Zealand’s exposures to interest rate risk and currency risk.
• hedges of other exposures relating to non-trading positions.
TYPES
ANZ New Zealand offers or uses four different types of derivative financial instruments:
Forwards
A contract documenting the rate of interest, or the currency exchange rate, to be paid or received on a notional
principal amount at a future date.
Futures
An exchange traded contract in which the parties agree to buy or sell an asset in the future for a price agreed on the
transaction date, with a net settlement in cash paid on the future date without physical delivery of the asset.
Swaps
A contract in which two parties exchange one series of cash flows for another.
Options
A contract in which the buyer of the contract has the right - but not the obligation - to buy (known as a ‘call option’)
or to sell (known as a ‘put option’) an asset or instrument at a set price on a future date. The seller has the
corresponding obligation to fulfil the transaction to sell or buy the asset or instrument if the buyer exercises the
option.
RISKS MANAGED
ANZ New Zealand offers and uses the instruments described above to manage fluctuations in the following market factors:
Foreign exchange
Currencies at current or determined rates of exchange.
Interest rate
Fixed or variable interest rates applying to money lent, deposited or borrowed.
Commodity
Soft commodities (that is, agricultural products such as wheat, coffee, cocoa, and sugar) and hard commodities (that
is, mined products such as gold, oil and gas).
Credit
Risk of default by customers or third parties.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

NOTES TO THE FINANCIAL STATEMENTS

20
9. DERIVATIVE FINANCIAL INSTRUMENTS (continued)
ANZ New Zealand uses central clearing counterparties and exchanges to settle derivative transactions. Different arrangements for posting of collateral
exist with these exchanges:
• some transactions are subject to clearing arrangements which result in separate recognition of collateral assets and liabilities, with the carrying
values of the associated derivative assets and liabilities held at their fair value.
• other transactions are legally settled by the payment or receipt of collateral which reduces the carrying values of the related derivative
instruments by the amount paid or received.
DERIVATIVE FINANCIAL INSTRUMENTS – HELD FOR TRADING
The majority of ANZ New Zealand’s derivative financial instruments are held for trading. The fair values of derivative financial instruments held for
trading are:
Assets Liabilities Assets Liabilities
2022 2022 2021 2021
Fair value NZ$m NZ$m NZ$m NZ$m
Interest rate contracts

Forward rate agreements
6 (2)
1 (1)
Futures contracts
109 (8)
19 (5)
Swap agreements
1,174 (1,004)
4,464 (3,329)
Options purchased
- -
1 -
Options sold
- (12) - -
Total 1,289 (1,026) 4,485 (3,335)
Foreign exchange contracts
Spot and forward contracts
5,829 (4,027)
2,193 (1,859)
Swap agreements
6,825 (6,442)
1,724 (1,711)
Options purchased
126 (10)
24 (2)
Options sold
10 (115)
2 (23)
Total
12,790 (10,594)
3,943 (3,595)
Commodity contracts and credit default swaps 35 (34) 13 (24)
Derivative financial instruments - held for trading 14,114 (11,654) 8,441 (6,954)

DERIVATIVE FINANCIAL INSTRUMENTS – DESIGNATED IN HEDGING RELATIONSHIPS
ANZ New Zealand uses two types of hedge accounting relationships:
Fair value hedge Cash flow hedge
Objective of this
hedging
arrangement
To hedge our exposure to changes to the fair value of a
recognised asset or liability or unrecognised firm
commitment caused by interest rate or foreign currency
movements.
To hedge our exposure to variability in cash flows of a
recognised asset or liability, a firm commitment or a
highly probable forecast transaction caused by interest
rate, foreign currency and other price movements.
Recognition of
effective hedge
portion
The following are recognised in profit or loss at the same
time:
• all changes in the fair value of the underlying item
relating to the hedged risk; and
• the change in the fair value of the derivatives.
We recognise the effective portion of changes in the fair
value of derivatives designated as a cash flow hedge in
the cash flow hedge reserve.
Recognition of ineffective
hedge portion
Recognised immediately in other operating income.
If a hedging instrument
expires, or is sold,
terminated, or exercised;
or no longer qualifies for
hedge accounting
When we recognise the hedged item in profit or loss, we
recognise the related unamortised fair value adjustment
in profit or loss. This may occur over time if the hedged
item is amortised to profit or loss as part of the effective
yield over the period to maturity.
Only when we recognise the hedged item in profit or
loss is the amount previously deferred in the cash flow
hedge reserve transferred to profit or loss.
Hedged item sold or
repaid
We recognise the unamortised fair value adjustment
immediately in profit or loss.
Amounts accumulated in equity are transferred
immediately to profit or loss.
Under the policy choice provided by NZ IFRS 9, ANZ New Zealand has continued to apply the hedge accounting requirements of NZ IAS 39.

NOTES TO THE FINANCIAL STATEMENTS

21
9. DERIVATIVE FINANCIAL INSTRUMENTS (continued)
The fair value of derivative financial instruments designated in hedging relationships are:

2022 2021
Nominal Nominal
amount Assets Liabilities amount Assets Liabilities

NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m
Fair value hedges
Interest rate swap agreements 30,861 920 (1,461) 28,969 614 (512)
Cash flow hedges
Interest rate swap agreements
34,202 444 (456)
27,820 228 (214)
Derivative financial instruments - designated in
hedging relationships
65,063 1,364 (1,917) 56,789 842 (726)

The maturity profile of the nominal amounts of our hedging instruments held is:
Average Less than 3 3 to 12 1 to 5 After 5
interest months months years years Total
Nominal amount
rate NZ$m NZ$m NZ$m NZ$m NZ$m
As at 30 September 2022

Fair value hedges

Interest rate
1.65% - 2,600 15,451 12,810 30,861
Cash flow hedges
Interest rate
2.26% 1,826 7,454 24,079 843 34,202

As at 30 September 2021

Fair value hedges
Interest rate 1.57% 247 3,556 13,718 11,448 28,969
Cash flow hedges

Interest rate 1.51% 2,585 5,226 18,981 1,028 27,820

The impacts of ineffectiveness from our designated hedge relationships by type of hedge relationship and type of risk being hedged are:

Ineffectiveness Amount reclassified

Change in value Hedge ineffectiveness from the cash flow
of hedging Change in value recognised in profit hedge reserve
instrument
2
of hedged item and loss to profit and loss
2022 2021 2022 2021 2022 2021 2022 2021

NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m
Fair value hedges
1

Interest rate
(1,048)
252
1,053
(246)
5
6
-
-
Cash flow hedges
1

.
Interest rate
22
(153)
(23)
152
(1)
(1)
3
10
1 All instruments are classified as derivative financial instruments.
2 Changes in value of hedging instruments is before any adjustments for Settle to Market clearing arrangements.
Hedge ineffectiveness recognised is classified within other operating income. Amounts reclassified to profit or loss are recognised within net interest
income or other operating income.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

NOTES TO THE FINANCIAL STATEMENTS

22
9. DERIVATIVE FINANCIAL INSTRUMENTS (continued)
The hedged items in relation to ANZ New Zealand’s fair value hedges are:

Accumulated fair value

hedge adjustments on

Carrying amount the hedged item
Balance sheet Assets Liabilities Assets Liabilities
presentation Hedged risk NZ$m NZ$m NZ$m NZ$m
As at 30 September 2022
Fixed rate debt issuances Debt issuances Interest rate - (19,497) - 1,403
Fixed rate investment securities at FVOCI
1
Investment securities Interest rate 11,506 - (976) -
Total

11,506 (19,497) (976) 1,403

As at 30 September 2021

Fixed rate debt issuances Debt issuances Interest rate - (17,271) - (271)
Fixed rate investment securities at FVOCI
1
Investment securities Interest rate 11,915 - (361) -
Total

11,915 (17,271) (361) (271)
1 The carrying amount of debt instruments at FVOCI does not include the fair value hedge adjustment since accounting for the hedge relationship results in the transfer of the hedge
adjustment out of other comprehensive income to the income statement to match the profit or loss on the hedging instrument.
There is no cumulative amount of fair value hedge adjustments relating to ceased hedge relationships remaining on the balance sheet as at 30
September 2022 (2021: NZ$2 million).

The hedged items in relation to ANZ New Zealand’s cash flow hedges are:

Continuing Discontinued
hedges hedges
2022 2021 2022 2021
Hedged risk NZ$m NZ$m NZ$m NZ$m
Floating rate loans and advances Interest rate
(437)
48
-
(1)
Floating rate customer deposits Interest rate
475
(36)
1
2

All cash flow hedges relate to hedges of interest rate risk and the movements in the cash flow hedge reserve are shown in the statement of changes
in equity on page 7.

NOTES TO THE FINANCIAL STATEMENTS

23

9. DERIVATIVE FINANCIAL INSTRUMENTS (continued)
RECOGNITION AND MEASUREMENT
Recognition
Initially and at each reporting date, we recognise all derivatives at fair value. If the fair value of a derivative is
positive, then we carry it as an asset, but if its value is negative, then we carry it as a liability.
Valuation adjustments are integral in determining the fair value of derivatives. This includes:
• a credit valuation adjustment (CVA) to reflect the counterparty risk and/or event of default; and
• a funding valuation adjustment (FVA) to account for funding costs and benefits in the derivatives portfolio.
Derecognition of
assets and liabilities
We remove derivative assets from our balance sheet when the contracts expire or we have transferred
substantially all the risks and rewards of ownership. We remove derivative liabilities from our balance sheet
when ANZ New Zealand’s contractual obligations are discharged, cancelled or expired.

With respect to derivatives cleared through a central clearing counterparty or exchange, derivative assets or
liabilities may be derecognised in accordance with the principle above when collateral is settled, depending
on the legal arrangements in place for each instrument.
Impact on the
income statement
The recognition of gains or losses on derivative financial instruments depends on whether the derivative is
held for trading or is designated into a hedging relationship. For derivative financial instruments held for
trading, gains or losses from changes in the fair value are recognised in profit or loss.

For an instrument designated in a hedging relationship, the recognition of gains or losses depends on the
nature of the item being hedged. Refer to the table on page 20 for details of the recognition approach applied
for each type of hedge accounting relationship.
Sources of hedge ineffectiveness may arise from differences in the interest rate reference rate, margins, or rate
set differences and differences in discounting between the hedged items and the hedging instruments.
Hedge effectiveness
To qualify for hedge accounting under NZ IAS 39, a hedge relationship is expected to be highly effective. A
hedge relationship is highly effective only if the following conditions are met:
• the hedge is expected to be highly effective in achieving offsetting changes in fair value or cash flows
attributable to the hedged risk during the period for which the hedge is designated (prospective
effectiveness); and
• the actual results of the hedge are within the range of 80-125% (retrospective effectiveness).
ANZ New Zealand monitors hedge effectiveness on a regular basis but at a minimum at least at each reporting
date.

KEY JUDGEMENTS AND ESTIMATES
Judgement is required when we select the valuation techniques used to determine the fair value of derivatives, particularly the selection
of valuation inputs that are not readily observable, and the application of valuation adjustments to certain derivatives. Refer to Note 16
fair value of financial assets and financial liabilities for further details.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

NOTES TO THE FINANCIAL STATEMENTS

24

10. INVESTMENT SECURITIES

2022 2021

NZ$m NZ$m
Investment securities measured at fair value through other comprehensive income

Debt securities 11,356 11,925
Equity securities
1
1
Total 11,357
11,926

The maturity profile of investment securities is as follows:

Less than 3 3 to 12 After No
months months 1 to 5 years 5 years maturity Total
As at 30 September 2022 NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m
Government securities
115 1,430 7,103 2,274 - 10,922
Corporate and financial institution securities
3 69 362 - - 434
Equity securities
- - - - 1 1
Total

118 1,499 7,465 2,274 1 11,357

As at 30 September 2021
Government securities 272 363 7,704 3,171 - 11,510
Corporate and financial institution securities 2 123 290 - - 415
Equity securities - - - - 1 1
Total

274 486 7,994 3,171 1 11,926

RECOGNITION AND MEASUREMENT
Investment securities are those financial assets in security form (that is, transferable debt or equity instruments) that are not held for trading
purposes. By way of exception, bills of exchange (a form of security/transferable instrument) which are used to facilitate ANZ New Zealand’s
customer lending activities are classified as loans and advances (rather than investment securities) to better reflect the substance of the
arrangement.
Equity investments not held for trading purposes may be designated at FVOCI on an instrument by instrument basis. If this election is made, gains or
losses are not reclassified from other comprehensive income to profit or loss on disposal of the investment. However, gains or losses may be
reclassified within equity.
Assets disclosed as investment securities are subject to the general classification and measurement policy for financial assets outlined on page 17.
Additionally, expected credit losses associated with ‘Investment securities - debt securities at fair value through other comprehensive income’ are
recognised and measured in accordance with the accounting policy outlined in Note 12 allowance for expected credit losses, and the allowance for
expected credit loss is recognised in the FVOCI reserve in equity with a corresponding charge to profit or loss.

KEY JUDGEMENTS AND ESTIMATES
Judgement is required when we select valuation techniques used to determine the fair value of assets not valued using quoted market
prices, particularly the selection of valuation inputs that are not readily observable. Refer to Note 16 fair value of financial assets and
financial liabilities for further details.

NOTES TO THE FINANCIAL STATEMENTS

25

11. NET LOANS AND ADVANCES
The following table provides details of net loans and advances for ANZ New Zealand:
2022 2021
Note NZ$m NZ$m
Overdrafts

968 799
Credit cards

1,238 1,127
Term loans - housing

104,178 98,831
Term loans - non-housing
41,234
40,528
Subtotal 147,618
141,285
Unearned income
(32)
(29)
Capitalised brokerage and other origination costs
433
403
Gross loans and advances

148,019
141,659
Allowance for expected credit losses 12
(646)
(585)
Net loans and advances

147,373 141,074
Residual contractual maturity:

Within one year
31,962
32,730
More than one year
115,411
108,344
Net loans and advances 147,373
141,074

ANZ New Zealand has reviewed the historic accounting treatment of a transaction product arrangement comprised of both overdraft and deposit
balances and concluded that, under NZ IAS 32 Financial Instruments: Presentation, the deposit amounts cannot be netted against the overdraft
balances drawn under the arrangement. The application of netting reduced the amounts presented for overdrafts (above) and customer deposits
(Note 13 deposits and other borrowings) by NZ$178 million as at 30 September 2021. Comparative amounts have not been restated as the impact is
not considered material.

RECOGNITION AND MEASUREMENT
Loans and advances are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market and are facilities
ANZ New Zealand provides directly to customers or through third party channels.
Loans and advances are initially recognised at fair value plus transaction costs directly attributable to the issue of the loan or advance, which are
primarily brokerage and other origination costs which we amortise over the estimated life of the loan. Subsequently, we then measure loans and
advances at amortised cost using the effective interest rate method, net of any allowance for expected credit losses.
ANZ New Zealand enters into transactions in which it transfers financial assets that are recognised on its balance sheet. When ANZ New Zealand
retains substantially all of the risks and rewards of the transferred assets, the transferred assets remain on ANZ New Zealand’s balance sheet, however
if substantially all the risks and rewards are transferred, ANZ New Zealand derecognises the asset. If the risks and rewards are partially retained and
control over the asset is lost, then ANZ New Zealand derecognises the asset. If control over the asset is not lost, then ANZ New Zealand continues to
recognise the asset to the extent of its continuing involvement.
We separately recognise the rights and obligations retained, or created, in the transfer of assets as appropriate.
Assets disclosed as net loans and advances are subject to the general classification and measurement policy for financial assets outlined on page 17.
Additionally, expected credit losses associated with loans and advances at amortised cost are recognised and measured in accordance with the
accounting policy outlined in Note 12 allowance for expected credit losses.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

NOTES TO THE FINANCIAL STATEMENTS

26
12. ALLOWANCE FOR EXPECTED CREDIT LOSSES

2022 2021
Collectively Individually Collectively Individually
assessed assessed Total assessed assessed Total
NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m
Net loans and advances at amortised cost 569 77 646 525 60 585
Off-balance sheet commitments
100 5 105
107 15 122
Total 669 82 751
632 75 707
The following tables present the movement in the allowance for expected credit losses (ECL).

Net loans and advances

Allowance for ECL is included in net loans and advances.

Stage 3

Stage 1 Stage 2
Collectively
assessed
Individually
assessed Total
As at 1 October 2020 161 347 80 107 695
Transfer between stages 16 (14) (2) - -
New and increased provisions (net of collective provision releases) (22) (19) (22) 67 4
Write-backs - - - (64) (64)
Bad debts written-off (excluding recoveries) - - - (47) (47)
Discount unwind reversal - - - (3) (3)
As at 30 September 2021
155 314 56 60 585
Transfer between stages 18 (10) (3) (5) -
New and increased provisions (net of collective provision releases) 26 7 6 87 126
Write-backs - - - (33) (33)
Bad debts written-off (excluding recoveries)
- - - (37) (37)
Discount unwind reversal
- - - 5 5
As at 30 September 2022 199 311 59 77 646
Off-balance sheet credit related commitments - undrawn and contingent facilities
Allowance for ECL is included in other provisions.

As at 1 October 2020 79 55 3 22 159
Transfer between stages 3 (4) 1 - -
New and increased provisions (net of collective provision releases) (18) (12) - (7) (37)
As at 30 September 2021
64 39 4 15 122
Transfer between stages
7 (6) (1) - -
New and increased provisions (net of collective provision releases)
(5) (2) - (10) (17)
As at 30 September 2022 66 31 3 5 105

The collectively assessed allowance for ECL increased by NZ$37 million attributable to: increases of NZ$24 million for downside risks associated with
the economic outlook, NZ$42 million due to portfolio credit risk profile changes reflecting the revised economic scenario weightings and enhanced
model methodology, partially offset by reductions of NZ$8 million in lower management temporary adjustments and NZ$21 million in large exposure
and model risk allowances.

CREDIT IMPAIRMENT CHARGE – INCOME STATEMENT
2022 2021
NZ$m NZ$m
New and increased provisions

- Collectively assessed
37
(93)
- Individually assessed
72
60
Write-backs
(33)
(64)
Recoveries of amounts previously written-off
(37)
(18)
Total credit impairment charge / (release)

39
(115)

NOTES TO THE FINANCIAL STATEMENTS

27

12. ALLOWANCE FOR EXPECTED CREDIT LOSSES (continued)
RECOGNITION AND MEASUREMENT
EXPECTED CREDIT LOSS MODEL
The measurement of expected credit losses reflects an unbiased, probability weighted prediction which evaluates a range of scenarios and takes
into account the time value of money, past events, current conditions and forecasts of future economic conditions.
Expected credit losses are either measured over 12 months or the expected lifetime of the financial asset, depending on credit deterioration since
origination, according to the following three-stage approach:
• Stage 1: At the origination of a financial asset, and where there has not been a Significant Increase in Credit Risk (SICR) since origination, an
allowance equivalent to 12 months ECL is recognised reflecting the expected credit losses resulting from default events that are possible
within the next 12 months from the reporting date. For instruments with a remaining maturity of less than 12 months, expected credit
losses are estimated based on default events that are possible over the remaining time to maturity.
• Stage 2: Where there has been a SICR since origination, an allowance equivalent to lifetime ECL is recognised reflecting expected credit
losses resulting from all possible default events over the expected life of a financial instrument. If credit risk were to improve in a subsequent
period such that the increase in credit risk since origination is no longer considered significant, the exposure returns to a Stage 1
classification with ECL measured accordingly.
• Stage 3: Where there is objective evidence of impairment, an allowance equivalent to lifetime ECL is recognised.
Expected credit losses are estimated on a collective basis for exposures in Stage 1 and Stage 2, and on either a collective or individual basis when
transferred to Stage 3.
MEASUREMENT OF EXPECTED CREDIT LOSS
ECL is calculated as the product of the following credit risk factors at a facility level, discounted to incorporate the time value of money:
• Probability of default (PD) – the estimate of the likelihood that a borrower will default over a given period;
• Exposure at default (EAD) – the expected balance sheet exposure at default taking into account repayments of principal and interest,
expected additional drawdowns and accrued interest; and
• Loss given default (LGD) – the expected loss in the event of the borrower defaulting, expressed as a percentage of the facility’s EAD, taking
into account direct and indirect recovery costs.
These credit risk factors are adjusted for current and forward-looking information through the use of macroeconomic variables.
EXPECTED LIFE
When estimating ECL for exposures in Stage 2 and 3, ANZ New Zealand considers the expected lifetime over which it is exposed to credit risk.
For non-retail portfolios, ANZ New Zealand uses the maximum contractual period as the expected lifetime for non-revolving credit facilities. For
non-retail revolving credit facilities, such as corporate lines of credit, the expected life reflects ANZ New Zealand’s contractual right to withdraw a
facility as part of a contractually agreed annual review, after taking into account the applicable notice period.
For retail portfolios, the expected lifetime is determined using a behavioural term, taking into account expected prepayment behaviour and
events that give rise to substantial modifications.
DEFINITION OF DEFAULT, CREDIT IMPAIRED AND WRITE-OFFS
The definition of default used in measuring ECL is aligned to the definition used for internal credit risk management purposes across all portfolios.
This definition is also in line with the regulatory definition of default. Default occurs when there are indicators that a debtor is unlikely to fully
satisfy contractual credit obligations to ANZ New Zealand, or the exposure is 90 days past due.
Financial assets, including those that are well secured, are considered credit impaired for financial reporting purposes when they default.
When there is no realistic probability of recovery, loans are written off against the related impairment allowance on completion of ANZ New
Zealand’s internal processes and when all reasonably expected recoveries have been collected. In subsequent periods, any recoveries of amounts
previously written-off are recorded as a release to the credit impairment charge in the income statement.
MODIFIED FINANCIAL ASSETS
If the contractual terms of a financial asset are modified or an existing financial asset is replaced with a new one for either credit or commercial
reasons, an assessment is made to determine if the changes to the terms of the existing financial asset are considered substantial. This assessment
considers both changes in cash flows arising from the modified terms as well as changes in the overall instrument risk profile; for example,
changes in the principal (credit limit), term, or type of underlying collateral. Where a modification is considered non-substantial, the existing
financial asset is not derecognised and its date of origination continues to be used to determine SICR. Where a modification is considered
substantial, the existing financial asset is derecognised and a new financial asset is recognised at its fair value on the modification date, which also
becomes the date of origination used to determine SICR for this new asset.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

NOTES TO THE FINANCIAL STATEMENTS

28

12. ALLOWANCE FOR EXPECTED CREDIT LOSSES (continued)
RECOGNITION AND MEASUREMENT
SIGNIFICANT INCREASE IN CREDIT RISK (SICR)
Stage 2 assets are those that have experienced a SICR since origination. In determining what constitutes a SICR, ANZ New Zealand considers
both qualitative and quantitative information:
i. Internal credit rating grade
For the majority of portfolios, the primary indicator of a SICR is a significant deterioration in the internal credit rating grade of a facility
since origination and is measured by application of thresholds.
For non-retail portfolios, a SICR is determined by comparing the Customer Credit Rating (CCR) applicable to a facility at reporting date to
the CCR at origination of that facility. A CCR is assigned to each borrower which reflects the PD of the borrower and incorporates both
borrower and non-borrower specific information, including forward-looking information. CCRs are subject to review at least annually or
more frequently when an event occurs which could affect the credit risk of the customer.
For retail portfolios, a SICR is determined, depending on the type of facility, by either comparing the scenario weighted lifetime PD at the
reporting date to that at origination, or by reference to customer behavioural score thresholds. The scenario weighted lifetime probability
of default may increase significantly if:
• there has been a deterioration in the economic outlook, or an increase in economic uncertainty; or
• there has been a deterioration in the customer’s overall credit position, or ability to manage their credit obligations.
ii. Backstop criteria
ANZ New Zealand uses 30 days past due arrears as a backstop criterion for both non-retail and retail portfolios. For retail portfolios only,
facilities are required to demonstrate three to six months of good payment behaviour prior to being allocated back to Stage 1.
FORWARD-LOOKING INFORMATION
Forward-looking information is incorporated into both our assessment of whether a financial asset has experienced a SICR since origination
and in our estimate of ECL. In applying forward-looking information for estimating ECL, ANZ New Zealand considers four probability-weighted
forecast economic scenarios as follows:
i. Base case scenario
The base case scenario is our view of future macroeconomic conditions. It reflects management’s assumptions used for strategic
planning and budgeting, and also informs the Banking Group’s Internal Capital Adequacy Assessment Process (ICAAP) which is the
process ANZ New Zealand applies in strategic and capital planning over a 3-year time horizon;
ii. Upside and iii. Downside scenarios
The upside and downside scenarios are fixed by reference to average economic cycle conditions (that is, they are not based on the
economic conditions prevailing at balance date) and are based on a combination of more optimistic (in the case of the upside) and
pessimistic (in the case of the downside) economic events and uncertainty over long term horizons; and
iv. Severe downside scenario
To better reflect the current economic conditions and geopolitical environment, ANZ New Zealand has altered the severe downside
scenario in 2022 from a scenario fixed by reference to average economic cycle conditions to one which aligns with the scenario used for
stress testing.
The four scenarios are described in terms of macroeconomic variables used in the PD, LGD and EAD models (collectively the ECL models)
depending on the lending portfolio and country of the borrower. Examples of the macroeconomic variables include unemployment rates, GDP
growth rates, house price indices, commercial property price indices and consumer price indices.
Probability weighting of each scenario is determined by management considering the risks and uncertainties surrounding the base case
economic scenario, as well as specific portfolio considerations where required.
Where applicable, temporary adjustments may be made to account for situations where known or expected risks have not been adequately
addressed in the modelling process.

NOTES TO THE FINANCIAL STATEMENTS

29

12. ALLOWANCE FOR EXPECTED CREDIT LOSSES (continued)

KEY JUDGEMENTS AND ESTIMATES
Collectively assessed allowance for expected credit losses
In estimating collectively assessed ECL, ANZ New Zealand makes judgements and assumptions in relation to:
• the selection of an estimation technique or modelling methodology; and
• the selection of inputs for those models, and the interdependencies between those inputs.
The following table summarises the key judgements and assumptions in relation to the model inputs and the interdependencies between those
inputs, and highlights significant changes during the current period.
The judgements and associated assumptions have been made within the context of the uncertainty of how various factors might impact the
global economy, and reflect historical experience and other factors that are considered to be relevant, including expectations of future events that
are believed to be reasonable under the circumstances. ANZ New Zealand’s ECL estimates are inherently uncertain and, as a result, actual results
may differ from these estimates.
Judgement /
assumption

Description
Considerations for the year ended
30 September 2022
Determining
when a SICR
has occurred
In the measurement of ECL, judgement is involved in
setting the rules and trigger points to determine
whether there has been a SICR since initial
recognition of a loan, which would result in the
financial asset moving from Stage 1 to Stage 2. This is
a key area of judgement since transition from Stage 1
to Stage 2 increases the ECL from an allowance based
on the probability of default in the next 12 months, to
an allowance for lifetime expected credit losses.
Subsequent decreases in credit risk resulting in
transition from Stage 2 to Stage 1 may similarly result
in significant changes in the ECL allowance.
The setting of precise trigger points requires
judgement which may have a material impact upon
the size of the ECL allowance. ANZ New Zealand
monitors the effectiveness of SICR criteria on an
ongoing basis.
ANZ New Zealand has adjusted the ECL this period to
account for expected deterioration in credit-
worthiness of certain customer segments which are
considered particularly vulnerable to economic
pressures such as higher interest rates, increasing
inflation and low wage growth.
Measuring
both 12-month
and lifetime
credit losses
The probability of default (PD), loss given default
(LGD) and exposure at default (EAD) credit risk
parameters used in determining ECL are point-in -time
measures reflecting the relevant forward-looking
information determined by management. Judgement
is involved in determining which forward-looking
information variables are relevant for particular
lending portfolios and for determining each
portfolio’s point-in -time sensitivity.
The modelled outcome as at 30 September 2021
included a model adjustment to recognise increased
model uncertainties as a result of COVID-19. With
these uncertainties largely being appropriately
reflected in the underlying models, the COVID-19
adjustments have been removed.

In addition, judgement is required where behavioural
characteristics are applied in estimating the lifetime of
a facility to be used in measuring ECL.
There were no material changes to the policies during
the year ended 30 September 2022.
Base case
economic
forecast
ANZ New Zealand derives a forward-looking “base
case” economic scenario which reflects our view of
the most likely future macroeconomic conditions.
There have been no changes to the types of forward-
looking variables (key economic drivers) used as
model inputs in the current year.
As at 30 September 2022, the base case assumptions
have been updated to reflect the relaxation of COVID-
19 related restrictions, continuing supply chain and
labour market pressures, and rapidly increasing global
inflation and interest rate rises globally, as well as
lower growth in key economies.
The expected outcomes of key economic drivers for
the base case scenario as at 30 September 2022 are
described below under the heading “Base case
economic forecast assumptions”.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

NOTES TO THE FINANCIAL STATEMENTS

30

12. ALLOWANCE FOR EXPECTED CREDIT LOSSES (CONTINUED)

KEY JUDGEMENTS AND ESTIMATES
Judgement /
assumption

Description
Considerations for the year ended
30 September 2022
Probability
weighting of
each economic
scenario (base
case, upside,
downside

and
severe
downside
scenarios)
1

Probability weighting of each economic scenario is
determined by management considering the risks
and uncertainties surrounding the base case
economic scenario at each measurement date.
The assigned probability weightings are subject to a
high degree of inherent uncertainty and therefore the
actual outcomes may be significantly different to
those projected.
To better reflect the current economic conditions and
geopolitical environment, ANZ New Zealand has
altered the severe downside scenario from a scenario
fixed by reference to average economic cycle
conditions to one which aligns with the scenario used
for stress testing.
The key considerations for probability weightings in
the current period include the emergence from
COVID-19 restrictions, how customers will respond to
interest rate rises and higher inflation, and potential
impacts of lower growth prospects globally.
Weightings for current and prior periods are as
detailed in the section on ‘Probability weightings’
below.
Management
temporary
adjustments
Management temporary adjustments to the ECL
allowance are used in circumstances where it is
judged that our existing inputs, assumptions and
model techniques do not capture all the risk factors
relevant to our lending portfolios. Emerging local or
global macroeconomic, microeconomic or political
events, and natural disasters that are not incorporated
into our current parameters, risk ratings, or forward-
looking information are examples of such
circumstances. The use of management temporary
adjustments may impact the amount of ECL
recognised.
As at 30 September 2022, Management no longer
consider that a separate management temporary
adjustment is necessary for the uncertainty associated
with COVID-19. Management have however included
adjustments to accommodate uncertainty associated
with rising inflation, rapidly increasing interest rates,
and ongoing supply chain and labour market
pressures.
In addition, management overlays have been made
for risks particular to personal and business banking.
Management temporary adjustments total NZ$169
million (2021: NZ$177 million).

1 The upside and downside scenarios are fixed by reference to average economic cycle conditions (that is, they are not based on the economic conditions prevailing at balance date) and are based
on a combination of more optimistic (in the case of the upside) and pessimistic (in the case of the downside) economic conditions.

Base case economic forecast assumptions
Continuing uncertainties described above increase the risk of the economic forecast resulting in an understatement or overstatement of the ECL
balance.
The economic drivers of the base case economic forecasts, reflective of our view of future macroeconomic conditions, used at 30 September 2022
are set out below. For the years following the near term forecasts below, the ECL models project future year economic conditions which include
an assumption of eventual reversion to mid-cycle economic conditions.

Forecast calendar year
New Zealand 2022 2023 2024
Gross domestic product (GDP) (annual % change) 1.9% 1.8% 1.7%
Unemployment rate 3.3% 3.9% 4.9%
Residential property prices (annual % change) -11.3% -3.1% 2.6%
Consumer price index (CPI) (annual % change) 6.8% 3.6% 1.9%
The base case economic forecasts reflect the expected slow down in economic activity globally from higher interest rates and increasing inflation,
along with declining residential property prices until 2024. Tight labour markets are expected to persist until central banks’ monetary policies have
the intended impact of reducing demand and bringing inflation down.

NOTES TO THE FINANCIAL STATEMENTS

31

12. ALLOWANCE FOR EXPECTED CREDIT LOSSES (continued)

KEY JUDGEMENTS AND ESTIMATES
Probability weightings
Probability weightings for each scenario are determined by management considering the risks and uncertainties surrounding the base case
economic scenario including the uncertainties described above.
The base case scenario represents an overall deterioration in the forecasts since September 2021. Given the uncertainties associated with how the
economy may respond to rapidly moving factors including inflation and lower economic growth globally, the base case weighting has been
reduced to 45.0% (2021: 50.0%), the upside scenario reduced to 0.0% (2021: 4.5%), the downside scenario reduced to 40.0% (2021:40.5%), and the
severe downside scenario increased to 15.0% (2021: 5.0%).
The assigned probability weightings are subject to a high degree of inherent uncertainty and therefore the actual outcomes may be significantly
different to those projected. ANZ New Zealand considers these weightings to provide estimates of the possible loss outcomes and taking into
account short and long term inter-relationships within ANZ New Zealand’s credit portfolios. The weightings applied are set out below:

2022 2021
Base 45.0% 50.0%
Upside 0.0% 4.5%
Downside 40.0% 40.5%
Severe downside 15.0% 5.0%
ECL - Sensitivity analysis
Given current economic uncertainties and the judgement applied to factors used in determining the expected default of borrowers in future
periods, expected credit losses reported by ANZ New Zealand should be considered as a best estimate within a range of possible estimates.
The table below illustrates the sensitivity of collectively assessed ECL to key factors used in determining it as at 30 September 2022:

ECL
NZ$m

Impact
NZ$m
If 1% of Stage 1 facilities were included in Stage 2
679 10
If 1% of Stage 2 facilities were included in Stage 1
668 (1)

100% upside scenario
100% base scenario
100% downside scenario
100% severe downside scenario
195
250
501
1,251
(474)
(419)
(168)
582

Individually assessed allowance for expected credit losses
In estimating individually assessed ECL, ANZ New Zealand makes judgements and assumptions in relation to expected repayments, the realisable
value of collateral, business prospects for the customer, competing claims and the likely cost and duration of the work-out process. Judgements
and assumptions in respect of these matters have been updated to reflect amongst other things, the uncertainties described above.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

NOTES TO THE FINANCIAL STATEMENTS

32

FINANCIAL LIABILITIES
Outlined below is a description of how we classify and measure financial liabilities relevant to the subsequent note disclosures.

CLASSIFICATION AND MEASUREMENT
Financial liabilities
Financial liabilities are measured at amortised cost, or fair value through profit or loss (FVTPL) when they are held for trading. Additionally, financial
liabilities can be designated at FVTPL where:
• the designation eliminates or significantly reduces an accounting mismatch which would otherwise arise;
• a group of financial liabilities are managed and their performance is evaluated on a fair value basis, in accordance with a documented risk
management strategy; or
• the financial liability contains one or more embedded derivatives unless:
a) the embedded derivative does not significantly modify the cash flows that otherwise would be required by the contract; or
b) the embedded derivative is closely related to the host financial liability.
Where financial liabilities are designated as measured at fair value, gains or losses relating to changes in the entity’s own credit risk are included in
other comprehensive income, except where doing so would create or enlarge an accounting mismatch in profit or loss.

13. DEPOSITS AND OTHER BORROWINGS
2022 2021
Note NZ$m NZ$m
Term deposits
46,746
40,668
On demand and short term deposits
62,203
62,648
Deposits not bearing interest
21,381
21,813
Total customer deposits 130,330 125,129
Certificates of deposit 1,639 1,875
Commercial paper 2,955 4,433
Securities sold under repurchase agreements
4,642
1,663
Borrowings from Ultimate Parent Bank and Immediate Parent Company 26
2,916
2,886
Deposits and other borrowings

142,482
135,986
Residual contractual maturity:

Within one year 134,486 130,430
More than one year 7,996 5,556
Deposits and other borrowings

142,482
135,986
Carried on balance sheet at:

Amortised cost
139,527
131,553
Fair value through profit or loss (designated on initial recognition)
2,955
4,433
Deposits and other borrowings 142,482 135,986

RECOGNITION AND MEASUREMENT
For deposits and other borrowings that:
• are not designated at FVTPL on initial recognition, we measure them at amortised cost and recognise their interest expense using the effective
interest rate method; and
• are managed on a fair value basis, reduce or eliminate an accounting mismatch or contain an embedded derivative, we designate them as
measured at fair value through profit or loss.
Refer to Note 16 fair value of financial assets and financial liabilities for further details.
For deposits and other borrowings designated at fair value we recognise the amount of fair value gain or loss attributable to changes in ANZ New
Zealand’s own credit risk in other comprehensive income in retained earnings. Any remaining amount of fair value gain or loss we recognise directly
in profit or loss. Once we have recognised an amount in other comprehensive income, we do not later reclassify it to profit or loss.
Securities sold under repurchase agreements represent a liability to repurchase the financial assets that remain on our balance sheet since the risks
and rewards of ownership remain with ANZ New Zealand. Over the life of the repurchase agreement, we recognise the difference between the sale
price and the repurchase price and charge it to interest expense in the income statement.

NOTES TO THE FINANCIAL STATEMENTS

33
14. DEBT ISSUANCES
ANZ New Zealand uses a variety of funding programmes to issue unsubordinated debt (including senior debt and covered bonds) and subordinated
debt. The difference between unsubordinated debt and subordinated debt is that holders of unsubordinated debt take priority over holders of
subordinated debt owed by the relevant issuer and subordinated debt will be repaid by the relevant issuer only after the repayment of claims of
depositors, other creditors and the senior debt holders.

2022 2021

NZ$m NZ$m
Senior debt
13,577
14,220
Covered bonds
4,082
4,248
Total unsubordinated debt

17,659
18,468
Subordinated debt

- ANZ Capital Notes
1,100
1,513
- Other subordinated debt 1,724 871
Total subordinated debt 2,824 2,384
Total debt issued 20,483 20,852
Residual contractual maturity:

Within one year
4,862
4,612
More than one year
15,621
16,240
Total debt issued 20,483
20,852
TOTAL DEBT ISSUED BY CURRENCY
The table below shows ANZ New Zealand’s issued debt by currency of issue, which broadly represents the debt holders’ base location.
2022 2021

NZ$m NZ$m
AUD Australian dollars
1,445
1,336
EUR Euro 6,668 8,055
NZD New Zealand dollars 1,794 2,553
CHF Swiss Francs 1,083 984
USD United States dollars
9,493
7,924
Total debt issued 20,483
20,852
Covered bonds are guaranteed by ANZNZ Covered Bond Trust Limited (the Covered Bond Guarantor), solely in its capacity as trustee of ANZNZ
Covered Bond Trust (the Covered Bond Trust). The Covered Bond Trust is a member of ANZ New Zealand, whereas the Covered Bond Guarantor is not
a member of ANZ New Zealand.
SUBORDINATED DEBT
Other subordinated debt instruments rank ahead of ANZ Capital Notes in any liquidation event impacting the issuer of the instruments. ANZ Capital
Notes 3 (ANZ CN3) rank equally with other additional tier 1 capital instruments issued by the Ultimate Parent Bank.
ANZ CAPITAL NOTES
ANZ Capital Notes are fully paid mandatorily convertible non-cumulative perpetual subordinated notes. Holders of ANZ Capital Notes do not have any
right to vote in general meetings of the Ultimate Parent Bank or the Bank.
ANZ Capital Notes are classified as debt given there are circumstances beyond ANZ New Zealand’s control where the principal is converted into a
variable number of ordinary shares of the Ultimate Parent Bank.
Distributions on ANZ CN3 are non-cumulative and subject to the issuer’s absolute discretion and certain payment conditions (including regulatory
requirements). Distributions on ANZ CN3 are franked in line with the franking applied to the Ultimate Parent Bank’s ordinary shares.
ANZ CN3 provides the issuer with an early redemption or conversion option on a specified date and in certain other circumstances (such as a tax or
regulatory event). This option is subject to APRA’s prior written approval.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

NOTES TO THE FINANCIAL STATEMENTS

34

14. DEBT ISSUANCES (continued)
ANZ CN3 will immediately convert into a variable number of ordinary shares of the Ultimate Parent Bank (based on the average market price of the
Ultimate Parent Bank’s ordinary shares immediately prior to conversion less a 1% discount, subject to a maximum conversion number of Ultimate
Parent Bank ordinary shares) if:
• the Overseas Banking Group’s Level 1 or Level 2 common equity tier 1 capital ratio is equal to or less than 5.125% - known as a Common Equity
Capital Trigger Event; or
• APRA notifies the Ultimate Parent Bank that, without the conversion or write-off of certain securities or a public injection of capital (or equivalent
support), it considers that the Ultimate Parent Bank would become non-viable – known as a Non-Viability Trigger Event.
ANZ CN3 mandatorily convert into a variable number of ordinary shares of the Ultimate Parent Bank (based on the average market price of the shares
immediately prior to conversion less a 1% discount):
• on a specified mandatory conversion date; or
• on an earlier date under certain circumstances as set out in the terms.
However, the mandatory conversion is deferred for a specified period if certain conversion tests are not met.
NZ$500 million of ANZ Capital Notes were redeemed on 31 December 2021.
The table below show the key details of the ANZ Capital Notes on issue at 30 September 2022:
ANZ CN 3
Issuer
NZ Branch
Issue date
5 March 2015
Issue amount
AU$970 million
Face value
AU$100
Distribution frequency
Semi-annually in arrears
Distribution rate

Floating rate: (Australian 180 day Bank Bill rate
+ 3.6%) x (1-Australian corporate tax rate)
Issuer's early redemption
24 March 2023
Mandatory conversion date
24 March 2025
Common equity capital trigger event
Yes
Non-viability trigger event
Yes
Carrying value (net of issue costs)
NZ$1,100 million

(2021: NZ$1,013 million)

RECOGNITION AND MEASUREMENT
Debt issuances are initially recognised at fair value and are subsequently measured at amortised cost, except where designated at fair value through
profit or loss. Interest expense on debt issuances is recognised using the effective interest rate method. Where ANZ New Zealand enters into a fair
value hedge accounting relationship, the fair value attributable to the hedge risk is reflected in adjustments to the carrying value of the debt.
Subordinated debt with capital-based conversion features (i.e. Common Equity Capital Trigger Events or Non-Viability Trigger Events) are considered
to contain embedded derivatives that we account for separately at fair value through profit or loss. The embedded derivatives arise because the
amount of shares issued on conversion following any of those trigger events is subject to the maximum conversion number, however they have no
significant value as of the reporting date given the remote nature of those trigger events.

NOTES TO THE FINANCIAL STATEMENTS

35
15. FINANCIAL RISK MANAGEMENT
RISK MANAGEMENT FRAMEWORK AND MODEL
INTRODUCTION
The use of financial instruments is fundamental to ANZ New Zealand’s businesses of providing banking and other financial services to our customers.
The associated financial risks (primarily credit, market, and liquidity risks) are a significant portion of ANZ New Zealand’s key material risks.
This note details ANZ New Zealand’s financial risk management policies, processes and quantitative disclosures in relation to the key financial risks:
Key material financial risks Key sections applicable to this risk
Credit risk
The risk of financial loss resulting from:
• a counterparty failing to fulfil its obligations; or
• a decrease in credit quality of a counterparty resulting in a financial loss.
Credit risk incorporates the risks associated with us lending to customers
who could be impacted by climate change or by changes to laws,
regulations, or other policies adopted by governments or regulatory
authorities, including carbon pricing and climate change adaptation or
mitigation policies.
• Credit risk overview, management and control responsibilities
• Maximum exposure to credit risk
• Credit quality
• Concentrations of credit risk
• Collateral management
Market risk
The risk to ANZ New Zealand’s earnings arising from:
• changes in interest rates, foreign exchange rates, credit spreads, volatility
and correlations; or
• fluctuations in bond, commodity or equity prices.
• Market risk overview, management and control responsibilities
• Measurement of market risk
• Traded and non-traded market risk
• Foreign currency risk – structural exposure
Liquidity and funding risk
The risk that ANZ New Zealand is unable to meet its payment obligations as
they fall due, including:
• repaying depositors or maturing wholesale debt; or
• ANZ New Zealand having insufficient capacity to fund increases in assets.
• Liquidity risk overview, management and control responsibilities
• Key areas of measurement for liquidity risk
• Liquidity portfolio management
• Funding position
• Residual contractual maturity analysis of ANZ New Zealand’s
liabilities
OVERVIEW
AN OVERVIEW OF OUR RISK MANAGEMENT FRAMEWORK
This overview is provided to aid the users of the financial statements in understanding the context of the financial disclosures required under NZ IFRS
7 Financial Instruments: Disclosures.
The Board is responsible for establishing and overseeing ANZ New Zealand’s Risk Management Framework (RMF). The Board has delegated authority
to the Bank’s Board Risk Committee (BRC) to develop and monitor compliance with ANZ New Zealand’s risk management policies. The BRC reports
regularly to the Board on its activities.
The Board approves the strategic objectives of ANZ New Zealand including:
• the Risk Appetite Statement (RAS), which sets out the Board’s expectations regarding the degree of risk that ANZ New Zealand is prepared to
accept in pursuit of its strategic objectives and business plan; and
• the Risk Management Strategy (RMS), which describes ANZ New Zealand’s strategy for managing risks and the key elements of the RMF that
give effect to this strategy. This includes a description of each material risk, and an overview of how the RMF addresses each risk, with reference
to the relevant policies, standards and procedures. It also includes information on how ANZ New Zealand identifies, measures, evaluates,
monitors, reports and controls or mitigates material risks.
ANZ New Zealand, through its training and management standards and procedures, aims to maintain a disciplined and robust control environment in
which all employees understand their roles and obligations. At ANZ New Zealand, risk is everyone’s responsibility.
ANZ New Zealand has an independent risk management function, headed by the Chief Risk Officer who:
• is responsible for overseeing the risk profile and the risk management framework;
• can effectively challenge activities and decisions that materially affect ANZ New Zealand’s risk profile; and
• has an independent reporting line to the BRC to enable the appropriate escalation of issues of concern.
Internal Audit Function
Internal Audit is a function independent of management whose role is to provide the Board and management with an effective and independent
appraisal of the internal controls established by management. Operating under a Board approved Charter, the reporting line for the outcomes of work
conducted by Internal Audit is direct to the Chair of the Audit Committee, with a direct communication line to the Chief Executive Officer and the
external auditor. The Internal Audit Plan is developed using a risk based approach and is reviewed quarterly. The Audit Committee approves the plan.
All audit activities are conducted in accordance with international internal auditing standards, and the results of the activities are reported to the Audit
Committee and management. These results influence the performance assessment of business heads. Furthermore, Internal Audit monitors the
remediation of audit issues and reports the current status of any outstanding audits.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

NOTES TO THE FINANCIAL STATEMENTS

36
15. FINANCIAL RISK MANAGEMENT (continued)
CREDIT RISK
CREDIT RISK OVERVIEW, MANAGEMENT AND CONTROL RESPONSIBILITIES
Granting credit facilities to customers is one of ANZ New Zealand’s major sources of income. As this activity is also a key material risk, ANZ New
Zealand dedicates considerable resources to its management. ANZ New Zealand assumes credit risk in a wide range of lending and other activities in
diverse markets and in many jurisdictions. Credit risks arise from traditional lending to customers as well as from interbank, treasury, trade finance and
capital markets activities.
Our credit risk management framework ensures we apply a consistent approach across ANZ New Zealand when we measure, monitor and manage
the credit risk appetite set by the Board. The Board is assisted and advised by the BRC in discharging its duty to oversee credit risk. The BRC:
• sets the credit risk appetite and credit strategies; and
• approves policies and control frameworks for the management of ANZ New Zealand’s credit risk.
The BRC delegates responsibility for day-to-day management of credit risk and compliance with credit risk policies to the Bank’s Credit Risk
Management Committee (CRMC).
We quantify credit risk through an internal credit rating system (Master Scale) to ensure consistency across exposure types and to provide a consistent
framework for re porting and analysis. The system uses models and other tools to measure the following for customer exposures:
Probability of Default (PD) Expressed by a Customer Credit Rating (CCR), reflecting ANZ New Zealand’s assessment of a customer’s
ability to service and repay debt.
Exposure at Default (EAD) The expected balance sheet exposure at default taking into account repayments of principal and
interest, expected additional drawdowns and accrued interest at the time of default.
Loss Given Default (LGD) Expressed by a Security Indicator (SI) ranging from A to G. The SI is calculated by reference to the
percentage of loan covered by security which ANZ New Zealand can realise if a customer defaults. The
A-G scale is supplemented by a range of other SIs which cover such factors as cash cover and sovereign
backing. For retail and some small business lending, we group exposures into large homogeneous
pools – and the LGD is assigned at the pool level.
Our specialist credit risk teams develop and validate ANZ New Zealand’s PD and LGD rating models. The outputs from these models drive our day-to-
day credit risk management decisions including origination, pricing, approval levels, regulatory capital adequacy, internal capital allocation, and credit
provisioning.
All customers with whom ANZ New Zealand has a credit relationship are assigned a CCR at origination via either of the following assessment
approaches:
Large and more complex lending Retail and some small business lending
Rating models provide a consistent and structured assessment, with
judgement required around the use of out-of-model factors. We
handle credit approval on a dual approval basis, jointly with the
business writer and an independent credit officer.
Automated assessment of credit applications using a combination of
scoring (application and behavioural), policy rules and external credit
reporting information. If the application does not meet the automated
assessment criteria, then it is subject to manual assessment.
We use ANZ New Zealand’s internal CCR to manage the credit quality of financial assets. To enable wider comparisons, ANZ New Zealand’s CCRs are
mapped to external rating agency scales as follows:
Credit quality
description

Internal CCR

ANZ New Zealand customer requirements
Moody’s
Rating
S&P Global
Ratings
Strong CCR 0+ to 4- Demonstrated superior stability in their operating and financial
performance over the long-term, and whose earnings capacity is
not significantly vulnerable to foreseeable events.
Aaa – Baa3 AAA – BBB-
Satisfactory CCR 5+ to 6- Demonstrated sound operational and financial stability over the
medium to long-term even though some may be susceptible to
cyclical trends or variability in earnings.
Ba1 – B1 BB+ – B+
Weak CCR 7+ to 8= Demonstrated some operational and financial instability, with
variability and uncertainty in profitability and liquidity projected to
continue over the short and possibly medium term.
B2 – Caa B - CCC
Defaulted CCR 8- to 10 When doubt arises as to the collectability of a credit facility, the
financial instrument (or ‘the facility’) is classified as defaulted.
n/a n/a

NOTES TO THE FINANCIAL STATEMENTS

37
15. FINANCIAL RISK MANAGEMENT (continued)
MAXIMUM EXPOSURE TO CREDIT RISK
For financial assets recognised on the balance sheet, the maximum exposure to credit risk is the carrying amount. In certain circumstances there may
be differences between the carrying amounts reported on the balance sheet and the amounts reported in the tables below. Principally, these
differences arise in respect of financial assets that are subject to risks other than credit risk, such as equity instruments which are primarily subject to
market risk, or bank notes and coins.
For undrawn facilities, this maximum exposure to credit risk is the full amount of the committed facilities. For contingent exposures, the maximum
exposure to credit risk is the maximum amount ANZ New Zealand would have to pay if the instrument is called upon.
The table below shows our maximum exposure to credit ri sk of on-balance sheet and off-balance sheet positions before taking account of any
collateral held or other credit enhancements.

Reported Excluded
1

Maximum exposure
to credit risk

2022 2021 2022 2021 2022 2021

NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m
On-balance sheet positions

Net loans and advances
147,373
141,074
-
-
147,373
141,074
Other financial assets:

Cash and cash equivalents
12,575
7,844
154
163
12,421
7,681
Settlement balances receivable
785
237
-
-
785
237
Collateral paid 1,672 537 - - 1,672 537
Trading securities
7,228 9,585 - - 7,228 9,585
Derivative financial instruments
15,478
9,283
-
-
15,478
9,283
Investment securities
11,357
11,926
-
-
11,357
11,926
Other financial assets
2

952
497
-
-
952
497
Total other financial assets 50,047
39,909
154
163
49,893
39,746
Subtotal 197,420
180,983
154
163
197,266
180,820
Off-balance sheet commitments

Undrawn and contingent facilities
3
29,879 29,780 - - 29,879 29,780
Total 227,299 210,763 154 163 227,145 210,600
1 Coins, notes and cash at bank within cash and cash equivalents were excluded as they do not have credit risk exposure.
2 Other financial assets mainly comprise accrued interest and acceptances.
3 Undrawn and contingent facilities include guarantees, letters of credit and performance related contingencies, net of collectively assessed and individually assessed allowance for expected
credit losses.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT
NOTES TO THE FINANCIAL STATEMENTS
38
15.FINANCIAL RISK MANAGEMENT (continued)
CREDIT QUALITY
An analysis of ANZ New Zealand’s credit risk exposure is presented in the following tables based on ANZ New Zealand’s internal credit quality rating
by stage without taking account of the effects of any collateral or other credit enhancements.
Net loans and advances
Stage 3
Stage 1 Stage 2
Collectively
assessed
Individually
assessed
Total
As at 30 September 2022 NZ$m NZ$m NZ$m NZ$m NZ$m
Strong
123,382 2,686 - - 126,068
Satisfactory
16,333 3,019 - - 19,352
Weak
257 1,205 - - 1,462
Defaulted
- - 590 146 736
Subtotal 139,972 6,910 590 146 147,618
Allowance for ECL
(199)(311)(59)(77)(646)
Net loans and advances at amortised cost 139,773 6,599 531 69 146,972
Coverage ratio 0.14% 4.50% 10.00% 52.74% 0.44%
Unearned income
(32)
Capitalised brokerage and other origination costs
433
Net carrying amount 147,373
As at 30 September 2021
Strong 116,875 1,625 - - 118,500
Satisfactory 17,133 3,136 - - 20,269
Weak 294 1,447 - - 1,741
Defaulted - - 620 155 775
Subtotal
134,302 6,208 620 155 141,285
Allowance for ECL (155) (314) (56) (60) (585)
Net loans and advances at amortised cost 134,147 5,894 564 95 140,700
Coverage ratio
0.12% 5.06% 9.03% 38.71% 0.41%
Unearned income (29)
Capitalised brokerage and other origination costs 403
Net carrying amount
141,074
Other financial assets
2022 2021
NZ$m NZ$m
Strong
49,827
39,682
Satisfactory 62 49
Weak 4 15
Defaulted
- -
Total carrying amount 49,893
39,746

NOTES TO THE FINANCIAL STATEMENTS
39
15.FINANCIAL RISK MANAGEMENT (continued)
Off-balance sheet commitments - undrawn and contingent facilities
Stage 3
Stage 1 Stage 2
Collectively
assessed
Individually
assessed
Total
As at 30 September 2022 NZ$m NZ$m NZ$m NZ$m NZ$m
Strong 25,593 224 - - 25,817
Satisfactory 3,368 682 - - 4,050
Weak
8 89 - - 97
Defaulted
- - 14 6 20
Gross undrawn and contingent facilities 28,969 995 14 6 29,984
Allowance for ECL included in other provisions (refer to Note 20)
(66)(31)(3)(5)(105)
Net undrawn and contingent facilities 28,903 964 11 1 29,879
Coverage ratio 0.23% 3.12% 21.43% 83.33% 0.35%
As at 30 September 2021
Strong 24,822 142 - - 24,964
Satisfactory 3,734 1,037 - - 4,771
Weak 12 100 - - 112
Defaulted - - 32 23 55
Gross undrawn and contingent facilities
28,568 1,279 32 23 29,902
Allowance for ECL included in other provisions (refer to Note 20) (64) (39) (4) (15) (122)
Net undrawn and contingent facilities
28,504 1,240 28 8 29,780
Coverage ratio
0.22% 3.05% 12.50% 65.22% 0.41%

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

NOTES TO THE FINANCIAL STATEMENTS

40
15. FINANCIAL RISK MANAGEMENT (continued)
CONCENTRATIONS OF CREDIT RISK
Credit risk becomes concentrated when a number of customers are engaged in similar activities, have similar economic characteristics, or have similar
activities within the same geographic region – therefore, they may be similarly affected by changes in economic or other conditions. ANZ New
Zealand monitors its credit portfolio to manage risk concentration and rebalance the portfolio. ANZ New Zealand also applies single customer
counterparty limits to protect against unacceptably large exposures to one single customer.
Analysis of financial assets by industry sector is based on Australian and New Zealand Standard Industrial Classification (ANZSIC) codes. The significant
categories shown are the level one New Zealand Standard Industry Output Categories (NZSIOC), except that Agriculture is shown separately as
required by the Order.

Composition of financial instruments that give rise to credit risk by industry group are presented below:

Loans and
advances
Other
financial
assets
Off-balance
sheet credit
related commitments Total
2022 2021 2022 2021 2022 2021 2022 2021
NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m
New Zealand residents

Agriculture
15,616
16,316
55
43
831
854
16,502
17,213
Forestry and fishing, agriculture services
624
659
16
5
113
137
753
801
Mining
123
95
20
6
350
428
493
529
Manufacturing
2,591
2,342
849
162
1,876
2,126
5,316
4,630
Electricity, gas, water and waste services
810
946
267
337
1,508
1,828
2,585
3,111
Construction
1,235
1,165
4
9
959
909
2,198
2,083
Wholesale trade
1,542
1,264
128
51
2,132
1,790
3,802
3,105
Retail trade and accommodation
2,713
2,473
12
12
735
848
3,460
3,333
Transport, postal and warehousing 994 943 40 55 860 708 1,894 1,706
Finance and insurance services 972 1,040 17,079 10,907 1,647 1,524 19,698 13,471
Rental, hiring & real estate services 38,859 37,504 1,915 1,627 2,610 2,357 43,384 41,488
Professional, scientific, technical,
administrative and support services
880 831 12 5 397 480 1,289 1,316
Public administration and safety
199
305
9,924
12,453
855
808
10,978
13,566
Health care and social assistance
950
716
24
12
474
479
1,448
1,207
Households
76,182
71,518
250
156
13,426
13,564
89,858
85,238
Other
1

1,097
1,095
133
78
1,122
962
2,352
2,135
Subtotal 145,387 139,212 30,728 25,918 29,895 29,802 206,010 194,932
Overseas

Finance and insurance services
103
104
19,048
13,797
89
100
19,240
14,001
Households
1,407
1,265
5
3
-
-
1,412
1,268
All other non-residents
721
704
112
28
-
-
833
732
Subtotal 2,231 2,073 19,165 13,828 89 100 21,485 16,001
Gross subtotal 147,618 141,285 49,893 39,746 29,984 29,902 227,495 210,933
Allowance for ECL
(646)
(585)
-
-
(105)
(122)
(751)
(707)
Subtotal 146,972
140,700
49,893
39,746
29,879
29,780
226,744
210,226
Unearned income
(32)
(29)
-
-
-
-
(32)
(29)
Capitalised brokerage and other origination
costs
433
403
-
-
-
-
433
403
Maximum exposure to credit risk 147,373 141,074 49,893 39,746 29,879 29,780 227,145 210,600
1 Other includes exposures to information media and telecommunications; education and training; arts and recreation services; and other services.

NOTES TO THE FINANCIAL STATEMENTS

41
15. FINANCIAL RISK MANAGEMENT (continued)
COLLATERAL MANAGEMENT
We use collateral for on and off-balance sheet exposures to mitigate credit risk if a counterparty cannot meet its repayment obligations. Where there is
sufficient collateral, an expected credit loss is not recognised. This is largely the case for certain lending products, such as margin loans and reverse
repurchase agreements that are secured by the securities purchased using the lending. For some products, the collateral provided by customers is
fundamental to the product’s structuring, so it is not strictly the secondary source of repayment - for example, lending secured by trade receivables is
typically re paid by the collection of those receivables. During the period there was no change in our collateral policies.
The nature of collateral or security held for the relevant classes of financial assets is as follows:
Net loans and advances
Loans – housing and personal Housing loans are secured by mortgage(s) over property and additional security may take the form of
guarantees and deposits.
Personal lending (including credit cards and overdrafts) is predominantly unsecured. If we take
security, then it is restricted to eligible vehicles, motor homes and other assets.
Loans – business Business loans may be secured, partially secured or unsecured. Typically, we take security by way of a
mortgage over property and/or a charge over the business or other assets.
If appropriate, we may take other security to mitigate the credit risk, such as guarantees, standby letters
of credit or derivative protection.
Other financial assets
Trading securities, investment
securities, derivatives and other
financial assets
For trading securities, we do not seek collateral directly from the issuer or counterparty. However, the
collateral may be implicit in the terms of the instrument (for example, with an asset-backed security).
The terms of debt securities may include collateralisation.
For derivatives, we typically terminate all contracts with the counterparty and settle on a net basis at
market levels current at the time of a counterparty default under International Swaps and Derivatives
Association (ISDA) Master Agreements.
Our preferred practice is to use a Credit Support Annex (CSA) to the ISDA so that open derivative
positions with the counterparty are aggregated and cash collateral (or other forms of eligible collateral)
is exchanged daily. The collateral is provided by the counterparty when their position is out of the
money (or provided to the counterparty by ANZ New Zealand when our position is out of the money).
Off-balance sheet positions
Undrawn and contingent facilities Collateral for off-balance sheet positions is mainly held against undrawn facilities, and they are typically
performance bonds or guarantees. Undrawn facilities that are secured include housing loans secured
by mortgages over residential property and business lending secured by commercial real estate and/or
charges over business assets.
The table below shows the estimated value of collateral we hold and the net unsecured portion of credit exposures:

Maximum exposure
to credit risk Total value of collateral
Unsecured portion of
credit exposure

2022 2021 2022 2021 2022 2021

NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m
Net loans and advances 147,373 141,074 139,455 134,119 7,918 6,955
Other financial assets
49,893
39,746
4,453
1,878
45,440
37,868
Off-balance sheet positions
29,879
29,780
15,758
16,241
14,121
13,539
Total
227,145
210,600
159,666
152,238
67,479
58,362

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

NOTES TO THE FINANCIAL STATEMENTS

42
15. FINANCIAL RISK MANAGEMENT (continued)
MARKET RISK
MARKET RISK OVERVIEW, MANAGEMENT AND CONTROL RESPONSIBILITIES
Market risk stems from ANZ New Zealand’s trading and balance sheet management activities and the impact of changes and correlations between
interest rates, foreign exchange rates, credit spreads and volatility in bond, commodity or equity prices.
The BRC delegates responsibility for day-to-day management of both market ri sk and compliance with market risk policies to the Bank’s Asset &
Liability Committee (ALCO).
Within overall strategies and policies established by the BRC, business units and risk management have joint responsibility for the control of market
risk at the ANZ New Zealand level. The Market Risk team (a specialist risk management unit independent of the business) allocates market risk limits at
various levels and monitors and reports on them daily. This detailed framework allocates individual limits to manage and control exposures using risk
factors and profit and loss limits.
Management, measurement and reporting of market risk is undertaken in two broad categories:
Traded market risk Non-traded market risk
Risk of loss from changes in the value of financial instruments due
to movements in price factors for both physical and derivative
trading positions. Principal risk categories monitored are:
• Currency risk – potential loss arising from changes in foreign
exchange rates or their implied volatilities.
• Interest rate risk – potential loss from changes in market
interest rates or their implied volatilities.
• Credit spread risk – potential loss arising from a movement
in margin or spread relative to a benchmark.
• Commodity risk – potential loss arising from changes in
commodity prices or their implied volatilities.
• Equity risk – potential loss arising from changes in equity
prices.
Risk of loss associated with the management of non-traded interest rate risk,
liquidity risk and foreign exchange exposures. This includes interest rate risk
in the banking book. This risk of loss arises from adverse changes in the
overall and relative level of interest rates for different tenors, differences in
the actual versus expected net interest margin, and the potential valuation
risk associated with embedded options in financial instruments and bank
products.

MEASUREMENT OF MARKET RISK
We primarily manage and control market risk using Value at Risk (VaR), sensitivity analysis and stress testing.
VaR measures ANZ New Zealand’s possible daily loss based on historical market movements.
ANZ New Zealand’s VaR approach for both traded and non-traded risk is historical simulation. We use historical changes in market rates, prices and
volatilities over:
• the previous 500 business days, to calculate standard VaR; and
• a 1-year stressed period, to calculate stressed VaR.
We calculate traded and non-traded VaR using a one-day holding period. For stressed VaR we use a ten-day period. Back testing is used to ensure our
VaR models remain accurate.
ANZ New Zealand measures VaR at a 99% confidence interval which means there is a 99% chance that a loss will not exceed the VaR for the relevant
holding period.

NOTES TO THE FINANCIAL STATEMENTS

43
15. FINANCIAL RISK MANAGEMENT (continued)
TRADED AND NON-TRADED MARKET RISK
Traded market risk
The table below shows the traded market risk VaR on a diversified basis by risk categories:

2022 2021
High for Low for Average High for Low for Average
As at year year for year As at year year for year
NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m
Traded value at risk 99% confidence

Foreign exchange
1.0 1.5 0.2 0.7
0.6 2.3 0.2 1.0
Interest rate
3.1 4.8 1.2 2.5
2.9 7.4 2.0 4.4
Credit
0.9 1.1 0.4 0.7
0.5 1.5 0.3 0.8
Diversification benefit
1

(1.3) n/a n/a (1.3)
(1.0) n/a n/a (1.3)
Total VaR 3.7 5.9 1.3 2.6 3.0 9.4 2.2 4.9
1 The diversification benefit reflects risks that offset across categories. The high and low VaR figures reported for each factor did not necessarily occur on the same day as the high and low VaR reported for
ANZ New Zealand as a whole. Consequently, a diversification benefit for high and low would not be meaningful and is therefore omitted from the table.

Non-traded market risk
Balance sheet risk management
The principal objectives of balance sheet risk management are to maintain acceptable levels of interest rate and liquidity risk to mitigate the negative
impact of movements in interest rates on the earnings and market value of ANZ New Zealand’s banking book, while ensuring ANZ New Zealand
maintains sufficient liquidity to meet its obligations as they fall due.
Interest rate risk management
Non-traded interest rate risk relates to the potential adverse impact of changes in market interest rates on ANZ New Zealand’s future net interest
income. This risk arises from two principal sources, namely mismatches between the repricing dates of interest bearing assets and liabilities; and the
investment of capital and other non-interest bearing liabilities and assets. Interest rate risk is reported using VaR and scenario analysis (based on the
impact of a 1% rate shock). The table below shows VaR figures for non-traded interest rate risk for ANZ New Zealand.

2022 2021
As at
High for
year
Low for
year
Average
for year As at
High for
year
Low for
year
Average
for year
NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m
Non-traded value at risk 99% confidence
Total VaR 30.1 30.9 21.0 26.0 22.5 38.4 22.3 30.5

We undertake scenario analysis to stress test the impact of extreme events on ANZ New Zealand’s market risk exposures. We model a 1% overnight
parallel positive shift in the yield curve to determine the potential impact on our net interest income over the next 12 months. This is a standard risk
measure which assumes the parallel shift is reflected in all wholesale and customer rates.
The table below shows the outcome of this risk measure for the current and previous financial years, expressed as a percentage of reported net
interest income.

2022 2021
Impact of 1% rate shock on 12 months of net interest income

As at period end
-0.5%
-1.4%
Maximum exposure
0.5% 0.2%
Minimum exposure
-2.2%
-2.1%
Average exposure (in absolute terms)
-0.7% -1.0%
FOREIGN CURRENCY RISK – STRUCTURAL EXPOSURES
Where it is considered appropriate, ANZ New Zealand takes out economic hedges against larger foreign exchange denominated revenue streams
(primarily Australian Dollar, US Dollar and US Dollar correlated). The primary objective of hedging is to ensure that, if practical, the effect of changes in
foreign exchange rates on the consolidated capital ratios are minimised.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

NOTES TO THE FINANCIAL STATEMENTS

44
15. FINANCIAL RISK MANAGEMENT (continued)
LIQUIDITY AND FUNDING RISK
LIQUIDITY RISK OVERVIEW, MANAGEMENT AND CONTROL RESPONSIBILITIES
Liquidity risk is the risk that ANZ New Zealand is either:
• unable to meet its payment obligations (including repaying depositors or maturing wholesale debt) when they fall due; or
• does not have the appropriate amount, tenor and composition of funding and liquidity to fund increases in its assets.
Management of liquidity and funding is overseen by ALCO following delegation from the BRC. Within an overall framework established by the BRC,
Treasury and Market Risk have responsibility for the control of funding and liquidity risk at ANZ New Zealand level. Liquidity and funding risks are
governed by a set of principles approved by the Risk Committees of the Bank’s and Ultimate Parent Bank’s Boards and include:
• maintaining the ability to meet all payment obligations in the immediate term;
• ensuring that ANZ New Zealand has the ability to meet ‘survival horizons’ under ANZ New Zealand specific and general market liquidity stress
scenarios to meet cash flow obligations over the short to medium term;
• maintaining strength in ANZ New Zealand’s balance sheet structure to ensure long term resilience in the liquidity and funding risk profile;
• ensuring the liquidity management framework is compatible with local regulatory requirements;
• preparing daily liquidity reports and scenario analysis to quantify ANZ New Zealand’s positions;
• targeting a diversified funding base to avoid undue concentrations by investor type, maturity, market source and currency;
• holding a portfolio of high quality liquid assets to protect against adverse funding conditions and to support day-to-day operations; and
• establishing a detailed contingency plan to cover different liquidity crisis events.
KEY AREAS OF MEASUREMENT FOR LIQUIDITY AND FUNDING RISK
Supervision and regulation
RBNZ requires the Bank to have a comprehensive Board approved liquidity strategy defining: policy, systems and procedures for measuring, assessing,
reporting and managing liquidity. This also includes a formal contingency plan for dealing with a liquidity crisis. The Banking Group is required to meet
one week and one month liquidity mismatch ratios and a one year core funding ratio each day.
Scenario modelling
A key component of ANZ New Zealand’s liquidity management framework is scenario modelling of a range of regulatory and internal liquidity metrics.
Potential severe liquidity crisis scenarios which model the behaviour of cash flows where there is a problem (real or perceived) may include, but are
not limited to, operational issues, doubts about the solvency of ANZ New Zealand, or adverse rating changes. Under these scenarios ANZ New
Zealand may have significant difficulty rolling over or replacing funding. ANZ New Zealand’s liquidity policy requires sufficient high quality liquid
assets to be held to meet its liquidity needs for the following one month under the modelled scenarios.
As of 30 September 2022 ANZ New Zealand was operating above the required minimums with the above scenarios.
Structural balance sheet metrics
ANZ New Zealand’s liquidity management framework also encompasses structural balance sheet metrics such as the RBNZ core funding ratio. The
core funding ratio is designed to limit the amount of wholesale funding required to be rolled over within a one year timeframe and so interact with
the liquidity scenarios to maintain ANZ New Zealand‘s liquidity position.
Wholesale funding
ANZ New Zealand’s wholesale funding strategy is designed to deliver a sustainable portfolio of wholesale funds that balances cost efficiency with
targeting diversification by markets, investors, currencies, maturities and funding structures. Short-term and long-term wholesale funding is managed
and executed by Treasury.
ANZ New Zealand also uses maturity concentration limits under the wholesale funding and liquidity management framework. Maturity concentration
limits ensure that ANZ New Zealand is not required to issue large volumes of new wholesale funding within a short time period to replace maturing
wholesale funding. Funding instruments used to meet the wholesale borrowing requirement must be on a pre-established list of approved products.
Funding capacity and debt issuance planning
ANZ New Zealand adopts a conservative approach to determine its funding capacity. Annually, a funding plan is approved by the Bank’s Board. The
plan is supplemented by regular updates and is linked to ANZ New Zealand’s three-year strategic planning cycle.

NOTES TO THE FINANCIAL STATEMENTS

45
15. FINANCIAL RISK MANAGEMENT (continued)
LIQUIDITY PORTFOLIO MANAGEMENT
ANZ New Zealand holds a diversified portfolio of cash and high quality liquid securities primarily to support liquidity risk management. The size of ANZ
New Zealand’s liquidity portfolio is determined with consideration of the amount required to meet the requirements of its internal and regulatory
liquidity scenario metrics.
2022 2021
NZ$m NZ$m
Central and local government bonds 8,316 10,312
Government treasury bills 829 899
Certificates of deposit 656 959
Other bonds
8,372
8,913
Securities eligible to be accepted as collateral in repurchase transactions
18,173
21,083
Cash and balances with central banks
10,267
7,013
Total liquidity portfolio 28,440
28,096

Assets held in ANZ New Zealand’s liquidity portfolio include short term cash held with RBNZ, New Zealand Government securities, securities issued by
supranational agencies, securities issued by highly rated banks and securities issued by State Owned Enterprises, Local Authorities and highly rated
New Zealand domestic corporates.
The Bank also held unencumbered internal residential mortgage backed securities (RMBS) which would be accepted as collateral by RBNZ in
repurchase transactions. These holdings would entitle the Bank to enter into repurchase transactions with RBNZ with a value of NZ$10,800 million at
30 September 2022 (2021: NZ$9,647 million).
RBNZ Term Lending Facility (TLF) and Funding for Lending Programme (FLP)
• Between May 2020 and July 2021, RBNZ made funds available under the TLF to promote lending to businesses. The TLF is a five-year secured
funding facility for New Zealand banks at a fixed rate of 0.25%.
• In November 2020, RBNZ announced the FLP which aimed to lower the cost of borrowing for New Zealand businesses and households. The FLP
is a three-year secured funding facility for New Zealand banks at a floating rate of the New Zealand Official Cash Rate (OCR). New Zealand banks
were able to obtain initial funding of up to 4% of their lending to New Zealand resident households, non-financial businesses and non-profit
institutions serving households as at 31 October 2020 (eligible loans). The initial allocation closed on 6 June 2022. An additional allocation of up
to 2% of eligible loans is available, subject to certain conditions until 6 December 2022.
As at 30 September 2022, the Bank had drawn NZ$300 million (2021: NZ$300 million) under the TLF and NZ$2,500 million (2021: NZ$1,000 million)
under the FLP. These amounts are included in securities sold under repurchase agreements in Note 13 deposits and other borrowings.
Liquidity crisis contingency planning
ANZ New Zealand maintains a liquidity crisis contingency plan to define an approach for analysing and responding to a liquidity-threatening event.
The framework includes:
• the establishment of crisis severity/stress levels;
• clearly assigned crisis roles and responsibilities;
• early warning signals indicative of an approaching crisis, and mechanisms to monitor and report these signals;
• action plans, and courses of action for altering asset and liability behaviour;
• procedures for crisis management reporting, and covering cash-flow shortfalls; and
• assigned responsibilities for internal and external communications.

FUNDING POSITION
ANZ New Zealand actively uses balance sheet disciplines to prudently manage the funding mix. ANZ New Zealand employs funding metrics to ensure
that an appropriate proportion of its assets are funded from stable sources, including customer liabilities, longer-dated wholesale debt (with
remaining term exceeding one year) and equity.

2022 2021
Note NZ$m NZ$m
Funding composition

Customer deposits 13
130,330
125,129
Wholesale funding

Debt issuances
20,483
20,852
Certificates of deposit and commercial paper
4,594 6,308
Other borrowings

7,558
4,549
Total wholesale funding

32,635
31,709
Total deposits and wholesale funding

162,965
156,838

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

NOTES TO THE FINANCIAL STATEMENTS

46
15. FINANCIAL RISK MANAGEMENT (continued)
Analysis of funding liabilities by industry is based on ANZSIC codes. The significant categories shown are the level one NZSIOC.

2022 2021
NZ$m NZ$m
Customer deposits by industry - New Zealand residents

Agriculture, forestry and fishing
4,843
4,485
Mining
257 216
Manufacturing

2,808
2,707
Construction
2,800 2,884
Wholesale trade

2,808
2,688
Retail trade and accommodation

2,197
2,177
Transport, postal and warehousing
1,347 894
Financial and insurance services

13,516
13,836
Rental, hiring and real estate services

3,851
4,260
Professional, scientific, technical, administrative and support services
6,741 6,560
Public administration and safety

1,258
1,813
Health care and social assistance
1,397 1,544
Arts, recreation and other services

2,120
2,226
Households

71,752
67,196
Other
1
2,783 2,153
Subtotal

120,478
115,639
Customer deposits by industry - overseas

Households 8,852 8,693
All other non-residents

1,000
797
Subtotal
9,852 9,490
Total customer deposits
130,330
125,129
Wholesale funding (financial and insurance services industry)

New Zealand 6,234 5,911
Overseas

26,401
25,798
Total wholesale funding
32,635 31,709
Total deposits and wholesale funding

162,965
156,838

Concentrations of funding by geography

New Zealand
126,712
121,550
Australia
4,845 4,194
United States

12,986
12,791
Europe

11,424
11,335
Other countries
6,998 6,968
Total deposits and wholesale funding

162,965
156,838
1 Other includes electricity, gas, water and waste services; information media and telecommunications; and education and training.

NOTES TO THE FINANCIAL STATEMENTS

47
15. FINANCIAL RISK MANAGEMENT (continued)
RESIDUAL CONTRACTUAL MATURITY ANALYSIS OF ANZ NEW ZEALAND’S FINANCIAL LIABILITIES
The tables below provide residual contractual maturity analysis of financial liabilities at 30 September 2022 and 30 September 2021 within relevant
maturity groupings. All outstanding debt issuances are profiled on the earliest date on which ANZ New Zealand may be required to pay. The amounts
represent principal and interest cash flows – so they may differ from equivalent amounts reported on the balance sheet.
It should be noted that this is not how ANZ New Zealand manages its liquidity risk. The management of this risk is detailed on page 44.

On
demand
Less than
3 months
3 to 12
months
1 to 5
years
After
5 years Total
2022 NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m
Settlement balances payable
4,677 253 - - - 4,930
Collateral received - 1,962 - - - 1,962
Deposits and other borrowings
83,587 24,315 27,546 8,649 - 144,097
Derivative financial liabilities (trading)
- 13,204 - - - 13,204
Debt issuances
1
- 275 5,204 14,463 3,243 23,185
Lease liabilities
- 13 39 155 42 249
Other financial liabilities
- 154 8 273 215 650
Derivative financial instruments
(balance sheet management)

- gross inflows
- 1,241 4,444 6,595 458 12,738
- gross outflows
- (1,251) (4,754) (6,736) (482) (13,223)

2021
Settlement balances payable 2,383 282 - - - 2,665
Collateral received - 738 - - - 738
Deposits and other borrowings 84,461 21,627 24,810 6,005 - 136,903
Derivative financial liabilities (trading) - 7,619 - - - 7,619
Debt issuances
1
- 38 4,601 12,216 4,907 21,762
Lease liabilities - 13 39 165 70 287
Other financial liabilities - 198 48 382 268 896
Derivative financial instruments
(balance sheet management)

- gross inflows - 462 3,144 4,795 296 8,697
- gross outflows - (480) (3,141) (4,753) (251) (8,625)
1 Any callable wholesale debt instruments have been included at their next call date. Refer to Note 14 debt issuances for subordinated debt call dates.

At 30 September 2022, NZ$29,984 million (2021: NZ$29,902 million) of its credit related commitments and contingent liabilities mature in less than 1
year, based on the earliest date on which ANZ New Zealand may be required to pay.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

NOTES TO THE FINANCIAL STATEMENTS

48
16. FAIR VALUE OF FINANCIAL ASSETS AND FINANCIAL LIABILITIES
CLASSIFICATION OF FINANCIAL ASSETS AND FINANCIAL LIABILITIES
ANZ New Zealand recognises and measures financial instruments at either fair value or amortised cost, with a significant number of financial
instruments on the balance sheet at fair value.
Fair value is the best estimate of the price that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between
market participants at the measurement date.
The following tables set out the classification of financial assets and financial liabilities according to measurement bases together with their carrying
amounts as recognised on the balance sheet.
2022 2021

At
amortised
cost
At fair
value Total
At
amortised
cost
At fair
value Total
Note NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m
Financial assets

Cash and cash equivalents 7 12,575 - 12,575 7,844 - 7,844
Settlement balances receivable 785 - 785 237 - 237
Collateral paid
1,672 - 1,672 537 - 537
Trading securities 8
- 7,228 7,228
- 9,585 9,585
Derivative financial instruments 9
- 15,478 15,478
- 9,283 9,283
Investment securities 10
- 11,357 11,357
- 11,926 11,926
Net loans and advances 11
147,373 - 147,373
141,074 - 141,074
Other financial assets

952 - 952
497 - 497
Total 163,357 34,063 197,420 150,189 30,794 180,983
Financial liabilities
Settlement balances payable 4,887 - 4,887 2,663 - 2,663
Collateral received

1,962 - 1,962
738 - 738
Deposits and other borrowings 13
139,527 2,955 142,482
131,553 4,433 135,986
Derivative financial instruments 9
- 13,571 13,571
- 7,680 7,680
Debt issuances 14
20,483 - 20,483
20,852 - 20,852
Other financial liabilities

763 364 1,127
591 676 1,267
Total 167,622 16,890 184,512 156,397 12,789 169,186
FINANCIAL ASSETS AND FINANCIAL LIABILITIES MEASURED AT FAIR VALUE
The fair valuation of financial assets and financial liabilities is generally determined at the individual instrument level.
If ANZ New Zealand holds offsetting risk positions, then we use the portfolio exemption in NZ IFRS 13 Fair Value Measurement (NZ IFRS 13) to measure
the fair value of such groups of financial assets and financial liabilities. We measure the portfolio based on the price that would be received to sell a net
long position (an asset) for a particular risk exposure, or to transfer a net short position (a liability) for a particular risk exposure.
Fair value designation
We designate commercial paper (included in deposits and other borrowings) as fair value through profit or loss where they are managed on a fair
value basis to align the measurement with how the instruments are managed.
FAIR VALUE APPROACH AND VALUATION TECHNIQUES
We use valuation techniques to estimate the fair value of assets and liabilities for recognition, measurement and disclosure purposes where no quoted
price in an active market exists for that asset or liability. This includes the following:
Asset or liability Fair value approach
Financial instruments classified as:
- Trading securities
- Derivative financial assets and financial liabilities
- Investment securities
Valuation techniques are used that incorporate observable market inputs for financial
instruments with similar credit risk, maturity and yield characteristics.
Financial instruments classified as:
- Net loans and advances
- Deposits and other borrowings
- Debt issuances
Discounted cash flow techniques are used whereby contractual future cash flows of the
instrument are discounted using wholesale market interest rates, or market borrowing rates
for debt with similar maturities or with a yield curve appropriate for the remaining term to
maturity.

NOTES TO THE FINANCIAL STATEMENTS

49
16. FAIR VALUE OF FINANCIAL ASSETS AND FINANCIAL LIABILITIES (continued)
FAIR VALUE HIERARCHY
ANZ New Zealand categorises assets and liabilities carried at fair value into a fair value hierarchy as required by NZ IFRS 13 based on the observability
of inputs used to measure the fair value:
• Level 1 – valuations based on quoted prices (unadjusted) in active markets for identical assets or liabilities;
• Level 2 – valuations using inputs other than quoted prices included within Level 1 that are observable for a similar asset or liability, either directly
or indirectly; and
• Level 3 – valuations where significant unobservable inputs are used to measure the fair value of the asset or liability.
The following table presents assets and liabilities carried at fair value in accordance with the fair value hierarchy:

Fair value measurements

Quoted market price
(Level 1)
Using observable inputs
(Level 2)
Using unobservable
inputs (Level 3)
Total
2022 2021 2022 2021 2022 2021 2022 2021
NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m
Assets

Trading securities
5,565
8,276
1,663
1,309
-
-
7,228
9,585
Derivative financial instruments
109
19
15,369
9,263
-
1
15,478
9,283
Investment securities
10,895 11,925 461 - 1 1 11,357 11,926
Total 16,569 20,220 17,493 10,572 1 2 34,063 30,794
Liabilities
Deposits and other borrowings
-
-
2,955
4,433
-
-
2,955
4,433
Derivative financial instruments
8
5
13,551
7,675
12
-
13,571
7,680
Other financial liabilities
364
676
-
-
-
-
364
676
Total 372
681
16,506
12,108
12
-
16,890
12,789
FINANCIAL ASSETS AND FINANCIAL LIABILITIES NOT MEASURED AT FAIR VALUE
The financial assets and financial liabilities listed in the table below are carried at amortised cost on ANZ New Zealand’s balance sheet. While this is the
value at which we expect the assets will be realised and the liabilities settled, ANZ New Zealand provides an estimate of the fair value of the financial
assets and financial liabilities at balance date in the table below.

Categorised into fair value hierarchy

Carrying amount
Quoted market price
(Level 1)
Using observable
inputs
(Level 2)
With significant non-
observable inputs
(Level 3) Fair value (total)
2022 2021 2022 2021 2022 2021 2022 2021 2022 2021
NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m
Financial assets

Net loans and advances 147,373 141,074 - - 136 129 145,623 140,892 145,759 141,021
Total 147,373
141,074
-
-
136
129
145,623
140,892
145,759
141,021
Financial liabilities

Deposits and other
borrowings
139,527 131,553 - - 139,316 131,713 - - 139,316 131,713
Debt issuances
20,483
20,852
3,677
3,671
16,679
17,437
-
-
20,356
21,108
Total 160,010
152,405
3,677
3,671
155,995
149,150
-
-
159,672
152,821

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

NOTES TO THE FINANCIAL STATEMENTS

50

16. FAIR VALUE OF FINANCIAL ASSETS AND FINANCIAL LIABILITIES (continued)
The following table sets out ANZ New Zealand’s basis of estimating the fair values of financial assets and liabilities carried at amortised cost where the
carrying value is not typically a reasonable approximation of fair value.
The carrying values of certain on-balance sheet financial instruments approximate fair values. These financial instruments are short term in nature or
are floating rate instruments that are re-priced to market interest rates on or near the end of the reporting period.
Financial asset and liability Fair value approach
Net loans and advances to banks Discounted cash flows using prevailing market rates for loans with similar credit quality.
Net loans and advances to customers Present value of future cash flows, discounted using a curve that incorporates changes in
wholesale market rates, ANZ New Zealand’s cost of wholesale funding and the customer margin,
as appropriate.
Deposit liability without a specified maturity or
at call
The amount payable on demand at the reporting date. We do not adjust the fair value for any
value we expect ANZ New Zealand to derive from retaining the deposit for a future period.
Interest bearing fixed maturity deposits and
other borrowings and acceptances with
quoted market rates
Market borrowing rates of interest for debt with a similar maturity are used to discount contractual
cash flows to derive the fair value.
Debt issuances Calculated based on quoted market prices or observable inputs as applicable. If quoted market
prices are not available, we use a discounted cash flow model using a yield curve appropriate for
the remaining term to maturity of the debt instrument. The fair value reflects adjustments to credit
spreads applicable to ANZ New Zealand for that instrument.

KEY JUDGEMENTS AND ESTIMATES
A significant portion of financial instruments are carried on ANZ New Zealand’s balance sheet at fair value. ANZ New Zealand therefore regularly
evaluates the key valuation assumptions used in the determination of the fair valuation of financial instruments incorporated within the
financial statements, as this can involve a high degree of judgement and estimation in determining the carrying values at the balance sheet
date.
In determining the fair valuation of financial instruments, ANZ New Zealand has considered the impact of related economic and market
conditions on fair value measurement assumptions and the appropriateness of valuation inputs in these estimates, notably valuation adjustments, as
well as the impact of these matters on the classification of financial instruments in the fair value hierarchy.
Most of the valuation models ANZ New Zealand uses employ only observable market data as inputs. For certain financial instruments, we may
use data that is not readily observable in current markets. If we use unobservable market data, then we need to exercise more judgement to
determine fair value depending on the significance of the unobservable input to the overall valuation. Generally, we derive unobservable
inputs from other relevant market data and compare them to observed transaction prices where available. When establishing the fair value of
a financial instrument using a valuation technique, ANZ New Zealand also considers any required valuation adjustments in determining the
fair value. We may apply adjustments (such as credit valuation adjustments and funding valuation adjustments – refer Note 9 derivative
financial instruments) to reflect ANZ New Zealand’s assessment of factors that market participants would consider in determining fair value of
a particular financial instrument.

NOTES TO THE FINANCIAL STATEMENTS

51
17. ASSETS CHARGED AS SECURITY FOR LIABILITIES AND COLLATERAL ACCEPTED AS
SECURITY FOR ASSETS
The following disclosure excludes the amounts presented as collateral paid and received in the balance sheet that relate to derivative liabilities and
derivative assets respectively. The terms and conditions of those collateral agreements are included in the standard CSA that forms part of the ISDA
Master Agreement under which most of our derivatives are executed.
ASSETS CHARGED AS SECURITY FOR LIABILITIES
Assets charged as security for liabilities include the following types of instruments:
• securities provided as collateral for repurchase transactions. These transactions are governed by standard industry agreements;
• specified residential mortgages provided as security for notes and bonds issued to investors as part of ANZ New Zealand’s covered bond
programmes; and
• collateral provided to RBNZ under the TLF and FLP.
The carrying amounts of assets pledged as security are as follows:

2022 2021
NZ$m NZ$m
Securities sold under agreements to repurchase
1

1,833
362
Residential mortgages pledged as security for repurchase agreements with RBNZ
3,494
1,556
Total assets of the ANZNZ Covered Bond Trust pledged as security for covered bonds
10,921
11,406
1 The amounts disclosed as securities sold under arrangements to repurchase include both:
• assets pledged as security which continue to be recognised on ANZ New Zealand’s balance sheet; and
• assets repledged, which are included in the disclosure below.

COLLATERAL ACCEPTED AS SECURITY FOR ASSETS
ANZ New Zealand has received collateral associated with various financial transactions. Under certain arrangements ANZ New Zealand has the right to
sell, or to repledge, the collateral received. These arrangements are governed by standard industry agreements.
The fair value of collateral we have received and that we have sold or repledged is as follows:
2022 2021
NZ$m NZ$m
Fair value of assets which can be sold or repledged
1,233
610
Fair value of assets sold or repledged
959
565

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

NOTES TO THE FINANCIAL STATEMENTS

52
18. OFFSETTING
We offset financial assets and financial liabilities in the balance sheet (in accordance with NZ IAS 32) when there is:
• a current legally enforceable right to set off the recognised amounts in all circumstances; and
• an intention to settle the asset and liability on a net basis, or to realise the asset and settle the liability simultaneously.
The following table identifies financial assets and financial liabilities which have not been offset but are subject to enforceable master netting
agreements (or similar arrangements) and the related amounts not offset in the balance sheet. We have not taken into account the effect of over
collateralisation.

Amount subject to master netting agreement or similar

Total
amounts
recognised
in the
balance
sheet
Amounts not
subject to
master
netting
agreement
or similar Total
Financial
instruments
Financial
collateral
(received)/
pledged Net amount
2022 NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m
Derivative financial instruments
15,478 (4,180) 11,298 (9,814) (1,128) 356
Reverse repurchase agreements
1

1,248 - 1,248 - (1,248) -
Total financial assets 16,726 (4,180) 12,546 (9,814) (2,376) 356
Derivative financial instruments
(13,571) 2,669 (10,902) 9,814 334 (754)
Repurchase agreements
2

(4,642) - (4,642) - 4,642 -
Total financial liabilities (18,213) 2,669 (15,544) 9,814 4,976 (754)

2021
Derivative financial instruments
3
9,283 (1,924) 7,359 (6,003) (374) 982
Reverse repurchase agreements
1
610 - 610 - (610) -
Total financial assets
9,893 (1,924) 7,969 (6,003) (984) 982
Derivative financial instruments (7,680) 1,250 (6,430) 6,003 81 (346)
Repurchase agreements
2
(1,663) - (1,663) - 1,663 -
Total financial liabilities (9,343) 1,250 (8,093) 6,003 1,744 (346)
1 Reverse repurchase agreements are presented in the balance sheet within cash and cash equivalents.
2

Repurchase agreements are presented in the balance sheet within deposits and other borrowings.
3 The comparative amounts for financial collateral received and net amount have been updated to include the effect of NZ$245 million of collateral received.

NOTES TO THE FINANCIAL STATEMENTS

53
19. GOODWILL AND OTHER INTANGIBLE ASSETS

2022 2021
NZ$m NZ$m
Goodwill

3,006 3,006
Management rights 76 76
Software
17 9
Goodwill and other intangible assets

3,099
3,091
GOODWILL AND OTHER INTANGIBLE ASSETS ALLOCATED TO CASH-GENERATING UNITS (CGUs)
Goodwill arose on the acquisition of the NBNZ Holdings Limited group on 1 December 2003, and the carrying amount reflects amortisation
recognised before the application of NZ IFRS from 1 October 2004 and subsequent business disposals. Funds management rights, assessed as having
indefinite useful lives, arose on the acquisition of the ING Holdings (NZ) Limited (now ANZ New Zealand Investments Holdings Limited) group on 30
November 2009.
Goodwill and funds management rights are allocated to CGUs as follows:

Goodwill Management rights

2022 2021 2022 2021
Cash generating unit NZ$m NZ$m NZ$m NZ$m
Personal

980 980 - -
Funds Management

62 62 76 76
Personal segment

1,042
1,042
76
76
Business

895
895
-
-
Institutional

1,069
1,069
-
-
Total

3,006
3,006
76
76

Goodwill was assessed for indicators of impairment as at 30 September 2022, taking into account the results of the February 2022 impairment test and
associated sensitivity and scenario analysis performed and the forecast impact of recent economic events. There were no indicators of impairment
therefore, in accordance with NZ IAS 36 Impairment of Assets, no further impairment test was required. The following information is for the annual
goodwill impairment test.
Annual goodwill impairment test
The annual impairment test is performed as at the end of February each year. Goodwill is considered to be impaired if the carrying amount of the
relevant CGU exceeds its recoverable amount. The recoverable amount of a CGU is the higher of its fair value less costs of disposal (FVLCOD) and its
value-in use (VIU). We use a value-in -use approach to estimate the recoverable amount of the CGU to which each goodwill component is allocated.
Based on this assessment no impairment was identified for any CGU, and therefore a FVLCOD calculation was not required.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

NOTES TO THE FINANCIAL STATEMENTS

54
19. GOODWILL AND OTHER INTANGIBLE ASSETS (continued)
VALUE-IN-USE
These calculations use cash flow projections based on a number of financial budgets within each CGU covering an initial forecast period. These
projections also incorporate economic assumptions including GDP, inflation, unemployment, residential and commercial property prices, the impact
of the restriction imposed by RBNZ on the payment of ordinary dividends by all New Zealand incorporated registered banks, and the implementation
of RBNZ’s increased capital requirements. Cash flows beyond the forecast period are extrapolated using the terminal growth rate. These cash flow
projections are discounted using a discount rate derived using a capital asset pricing model.
Future changes in the assumptions upon which the calculation is based may materially impact this assessment, resulting in the potential impairment
of part or all of the goodwill balances.
Input / assumption
Values applied in 28 February 2022 impairment test
Forecast period and projections To 30 September 2028 - an extended forecast period was used to cover the implementation of RBNZ’s
increased capital requirements over the transition period ending on 1 July 2028.
Revenue growth over forecast
period
Comprises impacts of net interest margin and volume growth, arising from planned responses to known
regulatory and economic forecasts. Average annual forecast revenue growth rates are shown below.
Credit impairment over forecast
period
Varies by CGU, based on ECL modelling for 2022 to 2024, before returning to long run experience levels for
2025 to 2028. Long run experience levels are based on ANZ New Zealand’s bad debts written off, net of
recoveries, since 2004 of 0.15% of gross loans and advances. Credit impairment for each CGU as a
percentage of forecast gross loans and advances for 2025 to 2028 is shown below.
Terminal growth rate 2.0% - based on 2025 forecast inflation from RBNZ’s February 2022 Monetary Policy Statement.
Discount rate
Post tax: 10.7% (February 2021: 9.4%).
The main variables in the calculation of the discount rate used are the risk free rate, beta and the market risk
premium. The risk free rate was the traded 10 year New Zealand government bond yield as at 28 February
2022 of 2.7%. The market risk premium was estimated using a range of methods incorporating historical
and forward-looking market data. Beta was consistent with observable measures applied in the regional
banking sector.
The values of the average revenue growth, credit impairment as a percentage of forecast gross loans and advances, and pre-tax discount rates
assumptions by CGU are shown in the table below. The implied pre-tax discount rates are significantly higher than the post-tax discount rate above
because regulatory capital retention over the forecast period is not tax effected.

Revenue growth Credit impairment Pre-tax discount rate
Cash generating unit

28 Feb 22 28 Feb 21 28 Feb 22 28 Feb 21 28 Feb 22 28 Feb 21
Personal (previously Retail and Business Banking)

5.1% 6.1% 0.12% 0.13% 20.8% 17.5%
Funds Management (previously Wealth)

6.4% 3.4% n/a 0.10% 18.6% 16.4%
Business (previously Commercial)

5.3%
4.2%
0.21%
0.21%
20.8%
17.8%
Institutional

3.6%
4.5%
0.22%
0.21%
20.6%
17.3%
We performed stress tests for key sensitivities in each CGU. A change, considered to be reasonably possible by management, in key assumptions
would not cause the carrying amount of any CGU to exceed its recoverable amount.

NOTES TO THE FINANCIAL STATEMENTS

55

19. GOODWILL AND OTHER INTANGIBLE ASSETS (CONTINUED)
RECOGNITION AND MEASUREMENT
The table below details how we recognise and measure different intangible assets:
Intangible Goodwill Software Management rights
Definition
Excess amount ANZ New
Zealand has paid in acquiring a
business over the fair value of
the identifiable assets and
liabilities acquired.
Purchased software owned by ANZ
New Zealand is capitalised.
Internal and external costs incurred
in building software and computer
systems costing more than NZ$20
million are capitalised as assets.
Those less than NZ$20 million are
expensed in the year in which the
costs are incurred.
Management fee rights arising from
acquisition of funds management
business.
Carrying value
Cost less any accumulated
impairment losses.
Allocated to the CGU to which
the acquisition relates.
Initially, measured at cost.
Subsequently, carried at cost less
accumulated amortisation and
impairment losses.
Costs incurred in planning or
evaluating software proposals or in
maintaining systems after
implementation are not capitalised.
Initially, measured at fair value at
acquisition.
Subsequently, carried at cost less
impairment losses.
Useful life
Indefinite.
Goodwill is reviewed for
impairment at least annually or
when there is an indication of
impairment.
Except for major core
infrastructure, amortised over
periods between 2-5 years;
however major core infrastructure
may be amortised up to 7 years
subject to approval by the Audit
Committee.
Purchased software is amortised
over 2 years unless it is considered
integral to other assets with a
longer useful life.
Management fee rights have an
indefinite life and are reviewed for
impairment at least annually or
when there is an indication of
impairment.
Amortisation
method
Not applicable. Straight-line method. Not applicable.

KEY JUDGEMENTS AND ESTIMATES
Management judgement is used to assess the recoverable value of goodwill and other intangible assets, and the useful economic life of
an asset, or whether an asset has an indefinite life. We reassess the recoverability of the carrying value at each reporting date.
Goodwill
A number of key judgements are required in the determination of whether or not a goodwill balance is impaired including:
• the level at which goodwill is allocated – consistent with prior periods the CGUs to which goodwill is allocated are ANZ New Zealand’s
revenue generating segments that benefit from relevant historical business combinations generating goodwill.
• determination of the carrying amount of each CGU which includes an allocation, on a reasonable and consistent basis of corporate
assets and liabilities that are not directly attributable to the CGUs to which goodwill is allocated.
• assessment of the recoverable amount of each CGU used to determine whether the carrying amount of goodwill is supported is
based on judgements including the selection of the model and key assumptions used to calculate the recoverable amount.
The assessment of the recoverable amount of each CGU has been made within the context of the inherent uncertainty described in the
key judgements and estimates section on page 9.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

NOTES TO THE FINANCIAL STATEMENTS

56

20. OTHER PROVISIONS

2022 2021
Note NZ$m NZ$m
Allowance for ECL on undrawn and contingent facilities 12
105
122
Customer remediation
70
98
Restructuring costs 11 25
Leasehold make good 22 22
Other 14 28
Total other provisions 222
295

Movements in other provisions

Customer Restructuring Leasehold

remediation costs make good Other

NZ$m NZ$m NZ$m NZ$m
Balance at start of year
98 25 22 28
New and increased provisions made during the year
3 5 2 1
Provisions used during the year
(31) (16) (2) -
Unused amounts reversed during the year
- (3) - (15)
Balance at end of year 70 11 22 14
Customer remediation
Customer remediation includes provisions for expected refunds to customers and other counterparties, remediation project costs and related
customer, counterparty and regulatory claims, penalties and litigation costs and outcomes.
Restructuring costs
Provisions for restructuring costs arise from activities related to material changes in the scope of business undertaken by ANZ New Zealand or the
manner in which that business is undertaken and include employee termination benefits. Costs relating to on-going activities are not provided for and
are expensed as incurred.
Leasehold make good
Provisions associated with leased premises where, at the end of a lease, ANZ New Zealand is required to remove any fixtures and fittings installed in
the leased property. This obligation arises immediately upon installation. Estimated make good costs are added to the leasehold improvement asset
(within premises and equipment) upon installation and amortised over the lease term.
Other
Other provisions comprise various other provisions including losses arising from other legal action, operational issues, and warranties and indemnities
provided in connection with various disposals of businesses and assets.

RECOGNITION AND MEASUREMENT
ANZ New Zealand recognises provisions when there is a present obligation arising from a past event, an outflow of economic resources is
probable, and the amount of the provision can be measured reliably.
The amount recognised is the best estimate of the consideration required to settle the present obligation at the reporting date, taking into
account the risks and uncertainties surrounding the timing and amount of the obligation. Where a provision is measured using the estimated cash
flows required to settle the present obligation, its carrying amount is the present value of those cash flows.

KEY JUDGEMENTS AND ESTIMATES
ANZ New Zealand holds provisions for various obligations including customer remediation, restructuring costs, leasehold make good and
litigation related claims. These provisions involve judgements regarding the timing and outcome of future events, including estimates of
expenditure required to satisfy such obligations. Where relevant, expert legal advice has been obtained and, in light of such advice,
provisions and/or disclosures as deemed appropriate have been made.
In relation to customer remediation, determining the amount of the provisions, which represent management’s best estimate of the cost
of settling the identified matters, requires the exercise of significant judgement. It will often be necessary to form a view on a number of
different assumptions, including the number of impacted customers, the average refund per customer, the associated remediation project
costs, and the implications of regulatory exposures and customer claims having regard to their specific facts and circumstances. There is a
heightened level of estimation uncertainty where the customer remediation provision relates to a legal proceeding or matter. The
appropriateness of the underlying assumptions is reviewed on a regular basis against actual experience and other relevant evidence
including expert legal advice and adjustments are made to the provisions where appropriate.

NOTES TO THE FINANCIAL STATEMENTS

57
21. SHAREHOLDERS' EQUITY
SHAREHOLDERS’ EQUITY
2022 2021
NZ$m NZ$m
Share capital and initial head office account 11,055 11,055
Reserves
FVOCI reserve 22 62
Cash flow hedge reserve

26
8
Total reserves

48
70
Retained earnings

4,369
3,951
Equity attributable to shareholders of the Ultimate Parent Bank

15,472
15,076
Non-controlling interests

550
-
Total shareholders' equity 16,022 15,076
SHARE CAPITAL
The table below details the movement in issued shares and share capital for the period.

Number of issued shares NZ$ millions

2022 2021 2022 2021
Ordinary shares
378,155,112
378,155,112
1,450
1,450
Redeemable preference shares
1

8,354,563,940
8,354,563,940
9,594
9,594
Total share capital 8,732,719,052
8,732,719,052
11,044
11,044
NZ Branch initial head office account
-
-
11
11
Total share capital & initial head office account 8,732,719,052
8,732,719,052
11,055
11,055
1

Includes 44,990 (2021: 44,990) uncalled NZ$1.00 shares.

Redeemable preference shares
All redeemable preference shares (RPS) were issued by ANZ Holdings (New Zealand) Limited to the Immediate Parent Company. RPS are redeemable
by ANZ Holdings (New Zealand) Limited providing notice in writing to holders of the redeemable preference shares. Dividends are payable at the
discretion of the Directors of ANZ Holdings (New Zealand) Limited and are non-cumulative.
There are eight classes of RPS, relating to issues in 1988, 2005, 2007, 2008, 2009, 2014, 2015 and 2018. ANZ Holdings (New Zealand) Limited did not
pay any dividends on RPS during the years ended 30 September 2022 and 30 September 2021.
NON-CONTROLLING INTERESTS

Profit attributable to non-
controlling interest
Equity attributable to non-
controlling interest
Distribution paid to non-
controlling interests
2022 2021 2022 2021 2022 2021
Preference shares issued by the Bank
-
-
550
-
-
-
Total -
-
550
-
-
-

The Bank has issued perpetual preference shares (PPS) that are considered non-controlling interests to ANZ New Zealand.
The key terms of the PPS are as follows:
PPS dividends
PPS dividends are payable at the discretion of the Directors of the Bank and are non-cumulative. The Bank must not resolve to pay any dividend or
make any other distribution on its ordinary shares until the next PPS dividend payment date if a PPS dividend is not paid.
Should the Bank elect to pay a PPS dividend, the PPS dividend is 6.95% per annum up until 18 July 2028 and thereafter a floating rate equal to the
aggregate of the New Zealand 3 month bank bill rate plus 3.25%, multiplied by one minus the New Zealand company tax rate (where the PPS
dividend is fully imputed), with PPS dividend payments due on 18 January, 18 April, 18 July and 18 October each year.
Redemption features
Holders of PPS have no right to require that the PPS be redeemed. The Bank may at its option redeem all of the PPS on an optional redemption date
(each PPS dividend date from 18 July 2028); or at any time following the occurrence of a tax event or regulatory event, subject to prior written
approval of RBNZ and meeting of other conditions.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

NOTES TO THE FINANCIAL STATEMENTS

58

21. SHAREHOLDERS' EQUITY (CONTINUED)
RECOGNITION AND MEASUREMENT
Ordinary shares
Ordinary shares have no par value. They entitle holders to receive dividends, or proceeds available on winding
up of ANZ Holdings (New Zealand) Limited, in proportion to the number of fully paid ordinary shares held.
They are recognised at the amount paid per ordinary share net of directly attributable costs. Every holder of
fully paid ordinary shares present at a meeting in person, or by proxy, is entitled to:

• on a show of hands, one vote; and
• on a poll, one vote, for each share held.
Redeemable
preference shares
Redeemable preference shares do not carry any voting rights. They are wholly classified as equity instruments
as there is no contractual obligation for the Bank to either deliver cash or another financial instrument or to
exchange financial instruments on a potentially unfavourable basis.

In the event of liquidation, holders of redeemable preference shares are entitled to available subscribed capital
per share, pari passu with all holders of existing redeemable preference shares but in priority to all holders of
ordinary shares. They have no entitlement to participate in further distribution of profits or assets.
Reserves:
Cash flow hedge
reserve
Includes fair value gains and losses associated with the effective portion of designated cash flow hedging
instruments together with any tax effect.
FVOCI reserve Includes the changes in fair value of investment securities together with any tax effect.
In respect of debt securities classified as measured at FVOCI, the FVOCI reserve records accumulated changes
in fair value arising subsequent to initial recognition, except for those relating to allowance for ECL, interest
income and foreign currency exchange gains and losses which are recognised in profit or loss. As debt
securities at FVOCI are recorded at fair value, the balance of the FVOCI reserve is net of the ECL allowance
associated with such assets. When a debt security measured at FVOCI is derecognised, the cumulative gain or
loss recognised in the FVOCI reserve in respect of that security is reclassified to profit or loss and presented in
other operating income.
In respect of the equity securities classified as measured at FVOCI, the FVOCI reserve records accumulated
changes in fair value arising subsequent to initial recognition (including any related foreign exchange gains or
losses). When an equity security measured at FVOCI is derecognised, the cumulative gain or loss recognised in
the FVOCI reserve in respect of that security is not recycled to profit or loss.
Non-controlling
interests:
Share in the net assets of controlled entities attributable to equity interests which ANZ New Zealand does not
own directly or indirectly. The equity interest comprises PPS issued by the Bank.
PPS do not carry any voting rights. They are wholly classified as equity instruments as there is no contractual
obligation for the Bank to either deliver cash or another financial instrument or to exchange financial
instruments on a potentially unfavourable basis.
In the event of liquidation, holders of PPS are entitled to available subscribed capital per share, pari passu with
all holders of existing preference shares and ANZ Capital Notes issued by the Bank but in priority to all holders
of ordinary shares issued by the Bank. They have no entitlement to participate in further distribution of profits
or assets.

NOTES TO THE FINANCIAL STATEMENTS

59
22. CAPITAL MANAGEMENT
CAPITAL MANAGEMENT STRATEGY
ANZ New Zealand’s core capital objectives are to:
• protect the interests of depositors, creditors and shareholders;
• ensure the safety and soundness of ANZ New Zealand’s capital position; and
• ensure that the capital base supports ANZ New Zealand’s risk appetite, and strategic business objectives, in an efficient and effective manner.
Most of ANZ New Zealand’s capital is held in, and managed by, the Banking Group. The Bank’s Board holds ultimate responsibility for ensuring that
capital adequacy of the Banking Group is maintained. This includes: setting, monitoring and obtaining assurance for the Banking Group’s Internal
Capital Adequacy Assessment Process (ICAAP) policy and framework; standardised risk definitions for all material risks; materiality thresholds; capital
adequacy targets; internal risk capital principles; and risk appetite.
The Banking Group has minimum and trigger levels for capital that ensure sufficient capital is maintained to:
• meet minimum prudential requirements imposed by the Bank’s regulators;
• ensure consistency with the Banking Group’s overall risk profile and financial positions, taking into account its strategic focus and business plan;
and
• support the internal risk capital requirements of the business.
ALCO is responsible for developing, implementing and maintaining the Banking Group's ICAAP framework, including ongoing monitoring, reporting
and compliance. The Banking Group’s ICAAP is subject to independent and periodic review.
REGULATORY ENVIRONMENT
The Ultimate Parent Bank is a registered bank in New Zealand, and conducts business in New Zealand through the NZ Branch. While RBNZ requires
the Ultimate Parent Bank to comply with the minimum capital adequacy requirements as administered by APRA, there are no regulatory capital
requirements that apply specifically to the NZ Branch or ANZ New Zealand.
MANAGED CAPITAL
The Banking Group is subject to its own regulatory capital requirements as administered by RBNZ. The following table provides details of the capital of
ANZ New Zealand which is managed outside the Banking Group.

2022 2021

NZ$m NZ$m
ANZ New Zealand shareholders' equity
16,022
15,076
Subordinated loan from the Ultimate Parent Bank used to purchase preference shares issued by the Bank
301
278
Borrowings from the Immediate Parent Company used to purchase ordinary shares issued by the Bank 1,766 1,766
less: Banking Group shareholders' equity (17,784) (16,892)
Capital of ANZ New Zealand managed outside the Banking Group

305 228
Total assets of ANZ New Zealand held outside the Banking Group 308 366
Ratio 99.0% 62.3%

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

NOTES TO THE FINANCIAL STATEMENTS

60

23. CONTROLLED ENTITIES
The following table lists the subsidiaries of ANZ New Zealand. All subsidiaries are 100% owned and incorporated in New Zealand unless stated
otherwise.
Nature of business
Australia and New Zealand Banking Group Limited (New Zealand Branch)
3,4
Registered bank
ANZ Holdings (New Zealand) Limited
4
Holding company

ANZ Bank New Zealand Limited Registered bank

ANZ Custodial Services New Zealand Limited Custodian and nominee

ANZ Investment Services (New Zealand) Limited Funds management

ANZ National Staff Superannuation Limited Staff superannuation scheme trustee

ANZ New Zealand (Int'l) Limited Finance

ANZ New Zealand Investments Holdings Limited
1
Holding company

ANZ New Zealand Investments Limited Funds management

ANZ New Zealand Investments Nominees Limited Custodian and nominee

OneAnswer Nominees Limited Wrap services provider

ANZNZ Covered Bond Trust
2
Securitisation entity

Arawata Assets Limited Property

Endeavour Finance Limited Investment

Kingfisher NZ Trust 2008-1
2
Securitisation entity
ANZ Nominees Pty Limited (New Zealand Branch)
3,4
Nominee
Institutional Securitisation Services Limited (New Zealand Branch)
3,4,5
Securitisation services
1 Formerly ANZ Wealth New Zealand Limited.
2 ANZ New Zealand does not own ANZNZ Covered Bond Trust and Kingfisher NZ Trust 2008-1. Control exists as ANZ New Zealand retains substantially all the risks and rewards of the
operations. Details of ANZ New Zealand’s interest in consolidated structured entities is included in Note 24 structured entities.
3 Incorporated in Australia and registered in New Zealand as an Overseas ASIC Company.
4 These companies are included in the Relevant Members of ANZ New Zealand referred to in the Directors’ and New Zealand Chief Executive Officer’s Statement on page 88.
5 Formerly ANZ Capel Court Limited (New Zealand Branch).
Changes in controlled entities
ANZ New Zealand Securities Limited amalgamated with the Bank on 31 March 2022.

RECOGNITION AND MEASUREMENT
ANZ New Zealand subsidiaries are those entities it controls through:
• being exposed to, or having rights to, variable returns from the entity; and
• being able to affect those returns through its power over the entity.
ANZ New Zealand assesses whether it has power over those entities by examining ANZ New Zealand’s existing rights to direct the relevant activities
of the entity.

NOTES TO THE FINANCIAL STATEMENTS

61
24. STRUCTURED ENTITIES
A Structured Entity (SE) is an entity that has been designed such that voting or similar rights are not the dominant factor in determining who controls
the entity. SEs are generally established with restrictions on their ongoing activities in order to achieve narrow and well defined objectives.
SEs are classified as subsidiaries and consolidated when control exists. If ANZ New Zealand does not control a SE, then it is not consolidated. This note
provides information on both consolidated and unconsolidated SEs.
ANZ New Zealand’s involvement with SEs is as follows:
Type Details
Securitisation
ANZ New Zealand uses the Kingfisher NZ Trust 2008-1 (the Kingfisher Trust) to securitise residential mortgages that
it has originated, in order to diversify sources of funding for liquidity management. The Kingfisher Trust is an
internal securitisation (bankruptcy remote) vehicle we created for the purpose of structuring assets that are eligible
for repurchase under agreements with RBNZ (these are known as ‘Repo eligible’).
ANZ New Zealand is exposed to variable returns from its involvement with the Kingfisher Trust and has the ability
to affect those returns through its power over the Kingfisher Trust’s activities. The Kingfisher Trust is therefore
consolidated.
As at 30 September 2022 and 30 September 2021, ANZ New Zealand had entered into repurchase agreements
with RBNZ in relation to the TLF and FLP.
Additionally, ANZ New Zealand may acquire interests in securitisation vehicles set up by third parties through
providing lending facilities to, or holding securities issued by, such entities.
ANZNZ Covered Bond Trust
(the Covered Bond Trust)
Substantially all of the assets of the Covered Bond Trust are made up of certain housing loans and related
securities originated by the Bank which are security for the guarantee by ANZNZ Covered Bond Trust Limited as
trustee of the Covered Bond Trust of issuances of covered bonds by the Bank, or its wholly owned subsidiary ANZ
New Zealand (Int’l) Limited, from time to time. The assets of the Covered Bond Trust are not available to creditors
of the Bank, although the Bank (or its liquidator or statutory manager) may have a claim against the residual assets
of the Covered Bond Trust (if any) after all prior ranking creditors of the Covered Bond Trust have been satisfied.
ANZ New Zealand is exposed to variable returns from its involvement with the Covered Bond Trust and has the
ability to affect those returns through its power over the Covered Bond Trust’s activities. The Covered Bond Trust is
therefore consolidated.
Structured finance
arrangements

ANZ New Zealand is involved with SEs established:
• in connection with structured lending transactions to facilitate debt syndication and/or to ring-fence
collateral; and
• to own assets that are leased to customers in structured leasing transactions.
ANZ New Zealand may provide risk management products (derivatives) to the SE.
In all instances, ANZ New Zealand does not control these SEs. Further, ANZ New Zealand’s involvement does not
establish more than a passive interest in decisions about the relevant activities of the SE, and accordingly we do
not consider that interest disclosable.
Funds management activities
ANZ New Zealand is the scheme manager for a number of Managed Investment Schemes (MIS). These MIS include
the ANZ and OneAnswer branded KiwiSaver, retail and wholesale schemes and the Bonus Bonds Scheme. These
MIS are financed through the issue of units to investors and ANZ New Zealand considers them to be SEs. ANZ New
Zealand’s interests in these MIS are limited to receiving fees for services or providing risk management products
(derivatives). These interests do not create significant exposures to the MIS that would allow ANZ New Zealand to
control the funds. Therefore, these MIS are not consolidated.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

NOTES TO THE FINANCIAL STATEMENTS

62

24. STRUCTURED ENTITIES (continued)
CONSOLIDATED STRUCTURED ENTITIES
Financial or other support provided to Consolidated Structured Entities
The Bank provides lending facilities, derivatives and commitments to the Kingfisher Trust and the Covered Bond Trust and/or holds debt instruments
that they have issued. The Bank did not provide any non-contractual support to consolidated SEs during the year (2021: nil).
UNCONSOLIDATED STRUCTURED ENTITIES
ANZ New Zealand’s interest in Unconsolidated Structured Entities
An ‘interest’ in an unconsolidated SE is any form of contractual or non-contractual involvement with a SE that exposes ANZ New Zealand to variability
of returns from the performance of that SE. These interests include, but are not limited to: holdings of debt or equity securities; derivatives that pass on
risks specific to the performance of the SE; lending; loan commitments; financial guarantees; and fees from funds management activities.
For the purpose of disclosing interests in unconsolidated SEs:
• no disclosure is made if ANZ New Zealand’s involvement is not more than a passive interest - for example: when ANZ New Zealand’s
involvement constitutes a typical customer-supplier relationship. On this basis, exposures to unconsolidated SEs that arise from lending, trading
and investing activities are not considered disclosable interests - unless the design of the structured entity allows ANZ New Zealand to
participate in decisions about the relevant activities (being those that significantly affect the entity’s returns).
• ‘interests’ do not include derivatives intended to expose ANZ New Zealand to market risk (rather than performance risk specific to the SE) or
derivatives through which ANZ New Zealand creates, rather than absorbs, variability of the unconsolidated SE (such as purchase of credit
protection under a credit default swap).
ANZ New Zealand earned funds management fees from its MIS of NZ$196 million (2021: NZ$204 million) during the year. As at 30 September 2022,
ANZ New Zealand had total funds under management of NZ$34.3 billion (2021: NZ$39.0 billion) of which NZ$24.6 billion (2021: NZ$28.5 billion)
related to its MIS, with the largest individual fund being approximately NZ$3.8 billion (2021: NZ$4.3 billion).
ANZ New Zealand did not provide any non-contractual support to unconsolidated SEs during the year (2021: nil): nor does it have any current
intention to provide financial or other support to unconsolidated SEs.
SPONSORED UNCONSOLIDATED STRUCTURED ENTITIES
ANZ New Zealand may also sponsor unconsolidated SEs in which it has no disclosable interest.
For the purposes of this disclosure, ANZ New Zealand considers itself the ‘sponsor’ of an unconsolidated SE if it is the primary party involved in the
design and establishment of that SE and:
• ANZ New Zealand is the major user of that SE; or
• ANZ New Zealand’s name appears in the name of that SE, or on its products; or
• ANZ New Zealand provides implicit or explicit guarantees of that SE’s performance.
The Bank has sponsored the ANZ PIE Fund, which invests only in deposits with the Bank. ANZ New Zealand does not provide any implicit or explicit
guarantees of the capital value or performance of investments in the ANZ PIE Fund. There was no income received from, nor assets transferred to, this
entity during the year.

KEY JUDGEMENTS AND ESTIMATES
Significant judgement is required in assessing whether ANZ New Zealand has control over Structured Entities. Judgement is required to
determine the existence of:
• power over the relevant activities (being those that significantly affect the entity’s returns); and
• exposure to variable returns of the entity.

NOTES TO THE FINANCIAL STATEMENTS

63
25. TRANSFERS OF FINANCIAL ASSETS
In the normal course of business ANZ New Zealand enters into transactions where it transfers financial assets directly to third parties. These transfers
may give rise to ANZ New Zealand fully, or partially, derecognising those financial assets - depending on ANZ New Zealand’s exposure to the risks and
rewards or control over the transferred assets. If ANZ New Zealand retains substantially all of the risk and rewards of a transferred asset, the transfer
does not qualify for derecognition and the asset remains on ANZ New Zealand’s balance sheet in its entirety.
Covered bonds
ANZ New Zealand operates a covered bond programme to raise funding. Refer to Note 24 structured entities for further details. The covered bonds
issued externally are included within debt issuances.
Repurchase agreements
When ANZ New Zealand sells securities subject to repurchase agreements under which we retain substantially all the risks and rewards of ownership,
then those assets do not qualify for derecognition. An associated liability is recognised for the consideration received from the counterparty.
The table below sets out the balance of assets transferred that do not qualify for derecognition, along with the associated liabilities:

Covered bonds Repurchase agreements
2022 2021 2022 2021
NZ$m NZ$m NZ$m NZ$m
Current carrying amount of assets transferred
10,921
11,406
5,327
1,918
Carrying amount of associated liabilities
4,082
4,248
4,642
1,663

26. RELATED PARTY DISCLOSURES
Key management personnel and their related parties
Key management personnel (KMP) are defined as directors and those executives having authority and responsibility for planning, directing and
controlling the activities of ANZ New Zealand. Executive roles included in KMP are the Bank’s Chief Executive Officer (CEO), all executives reporting
directly to the Bank’s CEO, and the CEO – NZ Branch.

2022 2021
Key management personnel compensation
1
NZ$000 NZ$000
Salaries and short-term employee benefits
12,077
11,256
Post-employment benefits
365
192
Other long-term benefits
2

93
68
Termination benefits
3
68 1,308
Share-based payments
2,887 2,395
Total

15,490
15,219
1 Includes former disclosed KMPs until the end of their employment, and close family members of KMP employed by the Banking Group.
2 Comprises long service leave accrued during the year.
3 Includes payments for accrued annual leave, long service leave and pay in lieu of notice in accordance with contract, payable on cessation.

2022 2021
Transactions and balances with key management personnel and their related parties
1
NZ$m NZ$m
Secured loans and advances
28
26
Credit related commitments (undrawn loan facilities)
3
3
Interest income

1
1
Customer deposits
2

17
19
Payables and other liabilities (share-based payments liability)
3 2
1 Includes KMP, close family members of KMP and entities that are controlled or jointly controlled by KMP or their close family members, of ANZ New Zealand and its parent companies.
2 Includes holdings of units in the ANZ PIE Fund (a sponsored unconsolidated structured entity) which are invested solely in deposits of the Bank.
Loans made to KMP and their related parties are made in the ordinary course of business on normal commercial terms and conditions no more
favourable than those given to other employees or customers, including the term of the loan, security required and the interest rate. No amounts
have been written off or forgiven, or individually assessed allowances for expected credit losses raised in respect of these balances (2021: nil).
All other transactions with KMP and their related parties are made on terms and conditions no more favourable than those given to other employees
or customers. These transactions generally involve the provision of financial and investment services. In addition to the amounts above:
• Aggregate amounts for each of unsecured loans and advances, interest expense, fee income, debt issuances and collectively assessed credit
impairment charge and allowance for expected credit losses were less than NZ$1 million for both years presented.
• KMP and their related parties also hold units in MIS managed by ANZ New Zealand. Transactions and balances in respect of these MIS holdings
are not disclosed because those MIS are unconsolidated structured entities and not included in the financial statements of ANZ New Zealand.
• Some KMP pay ANZ New Zealand for the use of carparks in premises owned or leased by ANZ New Zealand. These amounts were less than
NZ$0.1 million (2021: less than NZ$0.1 million).

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

NOTES TO THE FINANCIAL STATEMENTS

64
26. RELATED PARTY DISCLOSURES (continued)
Transactions with other members of the Overseas Banking Group and associates
ANZ New Zealand undertakes transactions with the Immediate Parent Company, the Ultimate Parent Bank, other members of the Overseas Banking
Group and associates.
These transactions principally consist of funding and hedging transactions, the provision of other financial and investment services, technology and
process support, and compensation for share based payments made to ANZ New Zealand employees. These transactions are conducted on an arm’s
length basis and on normal commercial terms.
2022 2021
Transactions NZ$m NZ$m
Immediate Parent Company

Interest expense
34
33
Dividends paid
1,880 845
Ultimate Parent Bank and other subsidiaries not part of ANZ New Zealand

Interest income 5 -
Interest expense
73 57
Other operating income
8
15
Operating expenses
107
120
Associates

Operating expenses
3
2
Share of associates' loss

1
1

2022 2021
Outstanding balances

NZ$m NZ$m
Ultimate Parent Bank and other subsidiaries not part of ANZ New Zealand
Cash and cash equivalents 36 152
Collateral paid
268 -
Derivative financial instruments
8,553 5,331
Other assets
76
41
Investments in associates
5
5
Total due from related parties

8,938
5,529
Immediate Parent Company

Deposits and other borrowings
1,766
1,766
Payables and other liabilities
18 12
Ultimate Parent Bank and other subsidiaries not part of ANZ New Zealand

Settlement balances payable 887 74
Collateral received
-
242
Deposits and other borrowings
1,150
1,195
Derivative financial instruments

8,723
4,972
Payables and other liabilities

42
39
Debt issuances

303
279
Associates

Deposits and other borrowings 1 1
Total due to related parties

12,890
8,580

Balances due from / to other members of the Overseas Banking Group and associates are unsecured. The Bank has provided guarantees and
commitments to, and received guarantees from, these entities as follows.

2022 2021

NZ$m NZ$m
Financial guarantees provided by the Ultimate Parent Bank and other subsidiaries not part of ANZ New Zealand 262 219
Financial guarantees provided to the Ultimate Parent Bank and other subsidiaries not part of ANZ New Zealand
89
100
Undrawn facilities provided to associates
1
1

NOTES TO THE FINANCIAL STATEMENTS

65
27. COMMITMENTS AND CONTINGENT LIABILITIES
CREDIT RELATED COMMITMENTS AND CONTINGENCIES

2022 2021
NZ$m NZ$m
Contract amount of:

Undrawn facilities
27,060
27,170
Guarantees and letters of credit
1,225
1,181
Performance related contingencies
1,699
1,551
Total 29,984
29,902

UNDRAWN FACILITIES
The majority of undrawn facilities are subject to customers maintaining specific credit and other requirements or conditions. Many of these facilities
are expected to be only partially used, and others may never be used at all. As such, the total of the nominal principal amounts is not necessarily
representative of future liquidity risks or future cash requirements. Based on the earliest date on which ANZ New Zealand may be required to pay, the
full amount of undrawn facilities mature within 12 months.
GUARANTEES, LETTERS OF CREDIT AND PERFORMANCE RELATED CONTINGENCIES
Guarantees, letters of credit and performance related contingencies relate to transactions that ANZ New Zealand has entered into as principal –
including: guarantees, standby letters of credit and documentary letters of credit.
Documentary letters of credit involve ANZ New Zealand issuing letters of credit guaranteeing payment in favour of an exporter. They are secured
against an underlying shipment of goods or backed by a confirmatory letter of credit from another bank.
Performance related contingencies are liabilities that oblige ANZ New Zealand to make payments to a third party if the customer fails to fulfil its non-
monetary obligations under the contract.
To reflect the risk associated with these transactions, we apply the same credit origination, portfolio management and collateral requirements that we
apply to loans. The contract amount represents the maximum potential amount that we could lose if the counterparty fails to meet its financial
obligations. As the facilities may expire without being drawn upon, the notional amounts do not necessarily reflect future cash requirements. Based
on the earliest date on which ANZ New Zealand may be required to pay, the full amount of guarantees and letters of credit and performance related
contingencies mature within 12 months.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

NOTES TO THE FINANCIAL STATEMENTS

66
27. COMMITMENTS AND CONTINGENT LIABILITIES (continued)
OTHER CONTINGENT LIABILITIES
There are outstanding court proceedings, claims and possible claims for and against ANZ New Zealand. Where relevant, expert legal advice has been
obtained and, in the light of such advice, provisions (refer to Note 20 other provisions) and/or disclosures as deemed appropriate have been made. In
some instances we have not disclosed the estimated financial impact of the individual items either because it is not practicable to do so or because
such disclosure may prejudice seriously the interests of ANZ New Zealand.
REGULATORY AND CUSTOMER EXPOSURES
ANZ New Zealand regularly engages with its regulators in relation to regulatory investigations, surveillance and reviews, reportable situations, civil
enforcement actions (whether by court action or otherwise), formal and informal inquiries and regulatory supervisory activities both in New Zealand
and globally. ANZ New Zealand has received various notices and requests for information from its regulators as part of both industry-wide and ANZ
New Zealand-specific reviews, and has also made disclosures to its regulators at its own instigation. The nature of these interactions can be wide
ranging and, for example, may include a range of matters including responsible lending practices, regulated lending requirements, product suitability
and distribution, interest and fees and the entitlement to charge them, customer remediation, wealth advice, insurance distribution, pricing,
competition, conduct in financial markets and financial transactions, capital market transactions, anti-money laundering and counter-terrorism
financing obligations, privacy obligations and information security, business continuity management, reporting and disclosure obligations and
product disclosure documentation. There may be exposures to customers which are additional to any regulatory exposures. These could include class
actions, individual claims or customer remediation or compensation activities. The outcomes and total costs associated with such reviews and
possible exposures remain uncertain.
The Bank self-identified three prescribed transaction reporting (PTR) matters to RBNZ, where transaction reports had not been filed within the
prescribed timeframe. RBNZ has informed the Bank that it considers one of these matters (related to 6,409 transaction reports of a certain SWIFT
message type) to be a material breach, and the other two to be minor breaches, of the Anti-Money Laundering and Countering Financing of Terrorism
(AML/CFT) Act 2009 relating to PTR. RBNZ’s enforcement team is considering this matter. The potential outcome of these matters remains uncertain at
this time.
LOAN INFORMATION LITIGATION
In September 2021, representative proceedings were brought against the Bank, alleging breaches of disclosure requirements under consumer credit
legislation in respect of variation letters sent to certain loan customers. The Bank is defending the allegations. The proceedings are still at an early
stage. A hearing of the plaintiff’s application for leave to bring re presentative proceedings was heard before the High Court in May 2022. The Court
has ruled that the proceedings shall proceed as an opt-out representative action brought by one representative plaintiff on behalf of a class, being
customers who entered into a home loan or personal loan with the Bank between 6 June 2015 and 28 May 2016 and requested a variation to that
loan during that period.
WARRANTIES AND INDEMNITIES
ANZ New Zealand has provided warranties, indemnities and other commitments in favour of the purchaser in connection with various disposals of
businesses and assets and other transactions, covering a range of matters and risks. It is exposed to potential claims under those warranties,
indemnities and commitments, some of which are currently active. The outcomes and total costs associated with these exposures remain uncertain.
REVIEWS UNDER SECTION 95 OF THE RESERVE BANK OF NEW ZEALAND ACT 1989 (RBNZ ACT)
Following a RBNZ notice under section 95 of the RBNZ Act in July 2019, the Bank obtained two external reviews. The first review was on the Bank’s
compliance with certain aspects of the RBNZ Banking Supervision Handbook document Capital Adequacy Framework (Internal Models Based
Approach) (BS2B) (Capital Adequacy Review), and the second review was on the effectiveness of the Bank’s directors’ attestation and assurance
framework (Attestation Review).
A summary of the final Attestation Review was published in March 2022. The report found that the Bank has taken appropriate steps to address the
recommendations from the 2019 Attestation Review report. The review noted that there has been a marked uplift in the overall capabilities within the
Bank in respect to the attestation process, with heightened focus and scrutiny from management, executives and the Bank’s board. The review also
noted while there are elements of the framework still in the process of being embedded, the key changes recommended in the 2019 Attestation
Review report have been appropriately addressed.

The final Capital Adequacy Review was completed in December 2021. The report found that the Bank had made significant progress to address non-
compliance issues and improvement items identified by the 2019 Capital Adequacy Review report. In particular, as at 30 September 2022 all previously
non-compliant capital models have been approved by RBNZ.

NOTES TO THE FINANCIAL STATEMENTS

67
28. AUDITOR FEES

2022 2021

NZ$000 NZ$000
KPMG New Zealand
Audit or review of financial statements
1

2,130
2,250
Audit related services:

Prudential and regulatory services
2

196
333
Offer documents assurance or review
130
117
Other assurance services
3

40
47
Total audit related services 366 497
Total auditor fees relating to ANZ New Zealand 2,496 2,747

Fees related to certain managed funds not recharged
4

262
244
Total auditor fees 2,758
2,991
1 Includes fees for both the audit of annual financial statements and reviews of interim financial statements.
2 Includes fees for reviews and controls reports required by regulations.
3 Includes fees for other reviews and agreed upon procedures engagements.
4 Amounts relate to the ANZ PIE Fund, ANZ Investments Private Scheme and SIL Mutual Funds, and include fees for audits of annual financial statements, registry audits, supervisor reporting
and other agreed upon procedures engagements.

ANZ New Zealand’s Policy allows KPMG New Zealand to provide assurance and other audit related services that, while outside the scope of the
statutory audit, are consistent with the role of an external auditor. These include regulatory and prudential reviews requested by regulators such as
RBNZ. Any other services that are not audit or audit-related services are non-audit services. The Policy allows certain non-audit services to be provided
where the service would not contravene auditor independence requirements. KPMG New Zealand may not provide services that are perceived to be
in conflict with the role of the external auditor or breach auditor independence. These include consulting advice and subcontracting of operational
activities normally undertaken by management, and engagements where the external auditor may ultimately be required to express an opinion on its
own work.

29. POTENTIAL NEW ULTIMATE HOLDING COMPANY
On 4 May 2022, the Ultimate Parent Bank announced its intention to lodge a formal application with APRA, the Australian Federal Treasurer and other
applicable regulators to establish a non-operating holding company and create distinct banking and non-bank groups within the organisation to
assist the Overseas Banking Group to better deliver its strategy to strengthen and grow its core business further.
Should the proposed restructure proceed, the Ultimate Parent Company will establish a non-operating holding company, ANZ Group Holdings
Limited, as the new listed parent holding company of the ANZ Group by a scheme of arrangement and to separate the Overseas Banking Group’s
banking and certain non-banking businesses into the ANZ Bank Group and ANZ Non-Bank Group. The ‘ANZ Bank Group’ would comprise the current
Australia and New Zealand Banking Group Limited and the majority of its present-day subsidiaries. The ‘ANZ Non-Banking Group’, would house
banking-adjacent businesses developed or acquired by the ANZ Group, as we continue to seek ways to bring the best new technology and banking-
adjacent services to our customers.
The Explanatory Memorandum has been registered with the Australian Securities and Investments Commission and the Ultimate Parent Bank
shareholders will be asked to vote on the scheme on 15 December 2022. A copy of the Explanatory Memorandum is available on the website
anz.com/schememeeting.
This is not expected to have a material impact on ANZ New Zealand.

68
REGISTERED BANK
DISCLOSURES

This section contains the additional disclosures required by the
Registered Bank Disclosure Statements (Overseas Incorporated Registered Banks) Order 2014.

Section Order reference Page
B1. General disclosures Schedule 2 69
B2. Additional financial disclosures Schedule 4 77
B3. Asset quality Schedule 7 78
B4. Credit and market risk exposures and capital adequacy Schedule 9 81
B5. Insurance business, securitisation, funds management, other fiduciary activities, Schedule 11 82
and marketing and distribution of insurance products
B6. Risk management policies Schedule 13 84

REGISTERED BANK DISCLOSURES

69
B1. GENERAL DISCLOSURES (UNAUDITED)
Details of registered bank, ultimate parent bank and ultimate holding company
The registered bank, which is also the ultimate parent bank and ultimate parent holding company, is Australia and New Zealand Banking Group
Limited (Ultimate Parent Bank). The principal office and place of business outside New Zealand, and address for service of the Ultimate Parent Bank, is
ANZ Centre, Melbourne, Level 9, 833 Collins Street, Docklands, Victoria 3008, Australia.
Subordination of claims of creditors
Certain creditors of the Ultimate Parent Bank are given a statutory priority under Australian law. Unsecured creditors of the NZ Branch could be
expected to rank behind such claims.
Specifically, pursuant to subsection 13A(3) of the Banking Act 1959 of the Commonwealth of Australia (the Banking Act), if an Authorised Deposit-
Taking Institution (ADI) (which includes the Ultimate Parent Bank) becomes unable to meet its obligations or suspends payment, the assets of the ADI
in Australia are to be available to meet the ADI's liabilities in the following order:
(a) first, the ADI's liabilities (if any) to APRA because of the rights APRA has against the ADI because of section 16AI or 16AIC of the Banking Act;
(b) second, the ADI's debts (if any) to APRA under section 16AO of the Banking Act;
(c) third, the ADI's liabilities (if any) in Australia in relation to protected accounts that account-holders keep with the ADI. (Broadly, this means
accounts (including deposit accounts) kept with the Ultimate Parent Bank that are situated in Australia and recorded in Australian dollars);
(d) fourth, the ADI’s debts (if any) to the Reserve Bank of Australia;
(e) fifth, the ADI’s liabilities (if any) under an industry support contract that is certified by APRA under section 11CB of the Banking Act; and
(f) sixth, the ADI's other liabilities in the order of their priority (apart from subsection 13A(3)).
Unsecured creditors of the NZ Branch could be expected to rank as a creditor pursuant to the sixth paragraph, together with other unsecured
creditors of the Ultimate Parent Bank that do not otherwise have a priority claim under preceding paragraphs.
Subsections 16(1) and (2) of the Banking Act provide that, despite anything contained in any law relating to the winding-up of companies, but subject
to subsection 13A(3) of the Banking Act, the debts of an ADI to APRA in respect of APRA's costs (including costs in the nature of remuneration and
expenses) of being in control of the ADI's business, or of having an administrator in control of the ADI's business, are a debt due to APRA and have
priority in a winding-up of the ADI over all other unsecured debts.
Section 86 of the Reserve Bank Act 1959 of the Commonwealth of Australia provides that notwithstanding anything contained in any law relating to
the winding-up of companies, but subject to subsection 13A(3) of the Banking Act, debts due to the Reserve Bank of Australia by any ADI shall, in a
winding-up, have priority over all other debts.
This description of the liabilities which are mandatorily preferred by law is not exhaustive.
These provisions affect all of the unsecured liabilities of the NZ Branch, which as at 30 September 2022, amounted to NZ$1,135m (2021: NZ$1,048m).
Requirement to maintain sufficient assets to cover ongoing obligation to pay deposit liabilities
Subsection 13A(4) of the Banking Act states that it is an offence if an ADI does not hold assets (excluding goodwill and any assets or other amount
excluded by the prudential standards for the purposes of that subsection) in Australia of a value that is equal to or greater than the total amount of its
deposit liabilities in Australia, and APRA has not authorised the ADI to hold assets of a lesser value. This requirement has the potential to impact on the
management of the liquidity of the NZ Branch.
APRA’s powers
The Ultimate Parent Bank is subject to extensive prudential regulation by APRA.
The Banking Act requires APRA to exercise its powers and functions for the protection of the depositors of Australian ADIs and for the promotion of
financial system stability in Australia.
Where APRA considers that an ADI may become unable to meet its obligations or suspends payment (among other circumstances), APRA can take
control of the ADI's business (including by appointment of an ADI statutory manager). APRA also has power to direct the ADI not to make payments in
respect of its indebtedness and to compulsorily transfer some or all of the ADI’s assets and liabilities to another ADI in certain circumstances and to
increase its capital in specified circumstances. A counterparty to a contract with an ADI cannot rely solely on the fact that an ADI statutory manager is
in control of the ADI's business or on the making of a direction or compulsory transfer order as a basis for denying any obligations to the ADI or for
accelerating any debt under that contract or closing out any transaction relating to that contract.
The Financial Sector Legislation Amendment (Crisis Resolution Powers and Other Measures) Act 2018 (the Crisis Management Act) amended the
Banking Act (among other statutes applicable to financial institutions in Australia) and was intended to enhance APRA’s powers. Specifically, the Crisis
Management Act enhanced APRA’s powers to facilitate resolution of the entities it regulates (and their subsidiaries) in times of distress. Additional
powers which could impact the Overseas Banking Group include greater oversight, management and directions powers in relation to the Ultimate
Parent Bank and other Overseas Banking Group entities which were previously not regulated by APRA, increased statutory management powers over
regulated entities within the Overseas Banking Group and changes which are designed to give statutory recognition to the conversion or write-off of
regulatory capital instruments.
The requirements of the Banking Act and the exercise by APRA of its powers have the potential to impact the management of the liquidity of ANZ
New Zealand.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

REGISTERED BANK DISCLOSURES

70
B1. GENERAL DISCLOSURES (UNAUDITED) (continued)
Restrictions on the Ultimate Parent Bank’s ability to provide financial support
Effect of APRA’s Prudential Standards
APRA Prudential Standard APS 222 Associations with Related Entities (APS222) sets minimum requirements for ADIs in Australia, including the Ultimate
Parent Bank, in relation to the monitoring, management and control of risks which arise from associations with related entities and also includes
maximum limits on intra-group financial exposures.
Under APS222, the Ultimate Parent Bank’s ability to provide financial support to the Bank is subject to the following restrictions:
• the Ultimate Parent Bank should not undertake any third party dealings with the prime purpose of supporting the business of the Bank;
• the Ultimate Parent Bank must not hold unlimited exposures (i.e. should be limited as to specified time or amount) in the Bank (e.g. not provide
a general guarantee covering any of the Bank’s obligations);
• the Ultimate Parent Bank must not enter into cross-default clauses whereby a default by the Bank on an obligation (whether financial or
otherwise) triggers or is deemed to trigger a default by the Ultimate Parent Bank on its obligations; and
• the level of exposure, net of exposures deducted from capital, of the Ultimate Parent Bank’s Level 1 Tier 1 capital base to the Bank should not
exceed: (A) 25% on an individual exposure basis; or (B) 75% in aggregate (being exposures to all similar regulated ADI equivalent entities related
to the Ultimate Parent Bank).
In addition, since 1 January 2021, no more than 5% of the Ultimate Parent Bank’s Level 1 Tier 1 capital base can comprise non-equity exposures to its
New Zealand operations (including its subsidiaries incorporated in New Zealand, such as the Banking Group, and the New Zealand Branch) during
ordinary times. This limit does not include holdings of capital instruments or eligible secured contingent funding support provided to the Bank during
times of financial stress.
APRA has also confirmed that contingent funding support by the Ultimate Parent Bank to the Bank during times of financial stress must be provided
on terms that are acceptable to APRA. At present, only covered bonds meet APRA’s criteria for contingent funding.
Effect of the Level 3 framework
In addition, certain requirements of APRA’s Level 3 framework relating to, among other things, group governance and risk exposures became effective
on 1 July 2017. This framework also requires that the Ultimate Parent Bank must limit its financial and operational exposures to subsidiaries (including
the Bank).
In determining the acceptable level of exposure to a subsidiary, the Board of the Ultimate Parent Bank should have regard to:
• the exposures that would be approved for third parties of broadly equivalent credit status;
• the potential impact on the Ultimate Parent Bank’s capital and liquidity positions; and
• the Ultimate Parent Bank’s ability to continue operating in the event of a failure by the Bank.
These requirements are not expected to place additional restrictions on the Ultimate Parent Bank’s ability to provide financial or operational support
to the Bank.
Other APRA powers
The Ultimate Parent Bank may not provide financial support in breach of the Banking Act, as described under ‘APRA’s powers’ above.
Guarantees
No material obligations of the NZ Branch are guaranteed as at 11 November 2022.

REGISTERED BANK DISCLOSURES

71
B1. GENERAL DISCLOSURES (UNAUDITED) (continued)
Directors, New Zealand Chief Executive Officer and Responsible Person
Any document or communication may be sent to any Director or the Chief Executive Officer – NZ Branch at the Registered Office. The document or
communication should be marked for the attention of that Director or the Chief Executive Officer – NZ Branch as applicable.
Directors of the Ultimate Parent Bank as at 11 November 2022

Paul O’Sullivan Shayne Elliott Ilana Atlas, AO
Position
Chairman and Director Chief Executive Officer and Director Director
Occupation
Company Director Chief Executive Officer – Australia and
New Zealand Banking Group
Company Director
Qualifications
BA (Mod) Economics, Advanced
Management Program of Harvard
BCom BJuris (Hons), LLB (Hons), LLM
Resides
Sydney, Australia Melbourne, Australia Sydney, Australia
Executive
No Yes No
Independent
Yes No Yes
Other company
directorships
Australian Tower Network Pty Ltd,
St Vincent’s Health Australia, Singtel Optus
Pty Ltd, Western Sydney Airport
Corporation
Financial Markets Foundation for
Children
Origin Energy Ltd, Scentre Group Ltd

Jane Halton, AO PSM Rt Hon Sir John Key, GNZM AC Graeme Liebelt
Position
Director Director Director
Occupation
Company Director Company Director Company Director
Qualifications
BA (Hons) Psychology, FIPAA,
Hon. FAAHMS, Hon. FACHSE, Hon. DLitt,
FAIM, FAICD, FAIIA
BCom, DCom (Honoris Causa) BEc (Hons), FAICD, FTSE, FIML
Resides
Canberra, Australia Auckland, New Zealand Melbourne, Australia
Executive
No No No
Independent
Yes Yes Yes
Other company
directorships
Vault Systems, Clayton Utz

Kyro Capital Ltd, Palo Alto Networks Inc,
Sashimi Holdings Ltd, Thirty Eight JK Ltd,
Thirty Eight JK Aviation Ltd
Amcor Ltd, Australian Foundation
Investment Company Ltd

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

REGISTERED BANK DISCLOSURES

72
B1. GENERAL DISCLOSURES (UNAUDITED) (continued)

John Macfarlane Christine O’Reilly Jeff Smith
Position
Director Director Director
Occupation
Company Director Company Director Company Director
Qualifications
BCom, MCom (Hons) BBus BA
PP
S
C
, MBA
Resides
Melbourne, Australia Melbourne, Australia United States of America
Executive
No No No
Independent
Yes Yes Yes
Other company
directorships
Colmac Group Pty Ltd, AGInvest
Holdings Ltd (MyFarm), Aikenhead
Centre for Medical Discovery Ltd,
Collins Farms Ltd, Collins Farms No 2
Ltd, Dumbarton Land Company Ltd,
Melior Genetics Ltd, Melior Venison
Ltd, The Boundary Ltd, Balmoral
Pastoral Investments Pty Ltd, L1 Long
Short Fund, The Kohwais Ltd
BHP Group Ltd, BHP Group Plc,
Stockland Corporation Ltd, The Baker
Heart & Diabetes Institute
Sonrai Security Inc

Chief Executive Officer – NZ Branch and Responsible Person as at 11 November 2022

Chris O’Neale Antonia Watson
Position
Chief Executive Officer – NZ Branch Responsible Person
1

Occupation
Chief Executive Officer, Australia and
New Zealand Banking Group – New
Zealand Branch
Chief Executive Officer New Zealand
Qualifications
BCA BCom (Hons), GAICD
Resides
Wellington, New Zealand Auckland, New Zealand
Other company
directorships
None Not applicable
1

Authorised in writing by the Directors to sign the Disclosure Statement in accordance with section 82 of the Banking (Prudential Supervision) Act 1989.
Transactions with Directors
There are no transactions entered into by any Director, the Chief Executive Officer – NZ Branch, or any immediate relative or close business associate
of any Director or the Chief Executive Officer – NZ Branch, with any part of ANZ New Zealand which has been either entered into on terms other than
those which would in the ordinary course of business be given to any other person of like circumstances or means or which could otherwise be
reasonably likely to influence materially the exercise of the Directors' or Chief Executive Officer – NZ Branch duties in respect of the NZ Branch and
ANZ New Zealand.
Board Audit Committee
There is a board Audit Committee which covers audit matters. The Committee has five members. Each member is a non-executive independent
Director.

REGISTERED BANK DISCLOSURES

73
B1. GENERAL DISCLOSURES (UNAUDITED) (continued)
Policy of the board of directors for avoiding or dealing with conflicts of interest
The Board of the Ultimate Parent Bank has adopted procedures to ensure that conflicts and potential conflicts of interest between a Director’s duties
to the Ultimate Parent Bank and their own interests are avoided or dealt with. Pursuant to these procedures:
• each Director should disclose to all Directors any material personal interest they have in any matter which relates to the affairs of the Ultimate
Parent Bank and any other interest which the Director believes is appropriate to disclose in order to avoid an actual conflict of interest or the
perception of a conflict of interest. This disclosure should be made as soon as practicable after the Director becomes aware of their interest or
the need to make a disclosure.
• any Director who has an interest of the type referred to above in a matter that is to be considered at a Directors' meeting, must not vote on the
matter nor be present while the matter is considered at the meeting, unless a majority of Directors who do not have such an interest in the
matter agree that the interest should not disqualify such Director from being present while the matter is being considered and from voting on
the matter. The minutes of the meeting should record the decision taken by the Directors who do not have an interest in the matter.
In addition, Standing Notices about Interests are maintained for each Director. If the Director's interests change, the Director shall disclose the change
as soon as practicable and an updated Standing Notice shall be tabled at the next Board meeting and recorded in the minutes of that meeting.

Auditors
KPMG, 18 Viaduct Harbour Avenue, Auckland, New Zealand.
Conditions of registration
The following conditions of registration were applicable as at 30 September 2022, and have applied from 1 November 2015.

The registration of Australia and New Zealand Banking Group Limited (the registered bank) in New Zealand is subject to the following conditions:
1. That the banking group does not conduct any non-financial activities that in aggregate are material relative to its total activities.
In this condition of registration, the meaning of “material” is based on generally accepted accounting practice.
2. That the banking group’s insurance business is not greater than 1% of its total consolidated assets.
For the purposes of this condition of registration, the banking group’s insurance business is the sum of the following amounts for entities in the banking group:
a) if the business of an entity predominantly consists of insurance business and the entity is not a subsidiary of another entity in the banking group whose
business predominantly consists of insurance business, the amount of the insurance business to sum is the total consolidated assets of the group headed by
the entity; and
b) if the entity conducts insurance business and its business does not predominantly consist of insurance business and the entity is not a subsidiary of another
entity in the banking group whose business predominantly consists of insurance business, the amount of the insurance business to sum is the total liabilities
relating to the entity’s insurance business plus the equity retained by the entity to meet the solvency or financial soundness needs of its insurance business.
In determining the total amount of the banking group’s insurance business—
a) all amounts must relate to on balance sheet items only, and must comply with generally accepted accounting practice; and
b) if products or assets of which an insurance business is comprised also contain a non-insurance component, the whole of such products or assets must be
considered part of the insurance business.
For the purposes of this condition of registration,—
“insurance business” means the undertaking or assumption of liability as an insurer under a contract of insurance:
“insurer” and “contract of insurance” have the same meaning as provided in sections 6 and 7 of the Insurance (Prudential Supervision) Act 2010.
3. That the business of the registered bank in New Zealand does not constitute a predominant proportion of the total business of the registered bank.
4. That no appointment to the position of the New Zealand chief executive officer of the registered bank shall be made unless:
a) the Reserve Bank has been supplied with a copy of the curriculum vitae of the proposed appointee; and
b) the Reserve Bank has advised that it has no objection to that appointment.
5. That Australia and New Zealand Banking Group Limited complies with the requirements imposed on it by the Australian Prudential Regulation Authority.
6. That Australia and New Zealand Banking Group Limited complies with the following minimum capital adequacy requirements, as administered by the Australian
Prudential Regulation Authority:
a) Common Equity Tier 1 capital of Australia and New Zealand Banking Group Limited is not less than 4.5 percent of risk weighted exposures;
b) Tier 1 capital of Australia and New Zealand Banking Group Limited is not less than 6 percent of risk weighted exposures;
c) Total capital of Australia and New Zealand Banking Group Limited is not less than 8 percent of risk weighted exposures.
7. That the business of the registered bank in New Zealand is restricted to:
a) acquiring for fair value, and holding, mortgages originated by ANZ Bank New Zealand Limited; and
b) any other business for which the prior written approval of the Reserve Bank has been obtained; and
c) activities that are necessarily incidental to the business specified in paragraphs (a) and (b).
8. That the value of the mortgages held by the registered bank in New Zealand must not exceed $15 billion in aggregate.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

REGISTERED BANK DISCLOSURES

74
B1. GENERAL DISCLOSURES (UNAUDITED) (continued)
9. That the registered bank in New Zealand does not incur any liabilities except:
a) to the government of New Zealand in respect of taxation and other charges;
b) to other branches or the head office of the registered bank;
c) to trade creditors and staff;
d) to ANZ Bank New Zealand Limited in respect of activities, other than borrowing, that are necessarily incidental to the business specified in paragraphs (a) and
(b) of condition 7; and
e) any other liabilities for which the prior written approval of the Reserve Bank has been obtained.

In these conditions of registration,—
“banking group” means the New Zealand business of the registered bank and its subsidiaries as required to be reported in group financial statements for the group’s
New Zealand business under section 461B(2) of the Financial Markets Conduct Act 2013.
“business of the registered bank in New Zealand” means the New Zealand business of the registered bank as defined in the requirement for financial statements for New
Zealand business in section 461B(1) of the Financial Markets Conduct Act 2013.
“generally accepted accounting practice” has the same meaning as in section 8 of the Financial Reporting Act 2013.

Other material matters
Climate related disclosures
The Financial Sector (Climate-related Disclosures and Other Matters) Amendment Act 2021 amended the Financial Markets Conduct Act 2013 with
effect from 27 October 2022. Should the proposed new ultimate holding company outlined in Note 29 to the financial statements proceed, the
amendments will require ANZ New Zealand to produce Climate Related Disclosures (CRD) from the year ending 30 September 2024, in accordance
with CRD reporting standards to be issued by the External Reporting Board. ANZ New Zealand is actively preparing to produce CRD in accordance
with this timetable.
New RBNZ capital requirements
RBNZ has released new bank capital adequacy requirements applying to New Zealand locally incorporated registered banks, which are set out in
RBNZ’s Banking Prudential Requirements documents. The new capital adequacy requirements are being implemented in stages during a transition
period from October 2021 to July 2028. The key requirements are:
• The Banking Group’s total capital requirement will increase to 18% of RWA, including tier 1 capital of at least 16% of RWA. Up to 2.5% of the tier 1
capital requirement can be made up of additional tier 1 (AT1) capital, with the remainder of the tier 1 requirement made up of common equity
tier 1 (CET1) capital. The increased capital ratios requirement will be implemented progressively from 1 July 2022 to 1 July 2028. AT1 capital must
consist of perpetual preference shares, which may be redeemable. The total capital requirement can also include tier 2 capital of up to 2% of
RWA. Tier 2 capital must consist of long-term subordinated debt.
• The tier 1 capital requirement will include a CET1 prudential capital buffer of 9% of RWA. This will include: a 2% domestic, systemically important
bank capital buffer; a 1.5% 'early-set' counter-cyclical capital buffer, which can be temporarily reduced to 0% following a financial crisis, or
temporarily increased to prevent asset price bubbles from developing; and a 5.5% capital conservation buffer.
• Contingent capital instruments will no longer be treated as eligible regulatory capital. As at 30 September 2022, the Bank had NZ$2,241 million
of AT1 instruments that will progressively lose eligible regulatory capital treatment over the transition period to 1 July 2028.
• As an internal ratings based approach accredited bank, the Banking Group’s RWA outcomes will be increased to approximately 90% of what
would be calculated under the standardised approach. This will be achieved by applying an 85% output floor from 1 January 2022, and
increasing the credit RWA scalar from 1.06 to 1.20 from 1 October 2022.
RBNZ’s reforms will result in a material increase in the level of capital that the Banking Group is required to hold. The reforms could have a material
impact on the Banking Group and its business, including on its capital allocation and business planning.
Pending proceedings or arbitration
A description of any pending legal proceedings or arbitration concerning any member of ANZ New Zealand that may have a material adverse effect
on the NZ Branch or ANZ New Zealand is included in Note 27 commitments and contingent liabilities.

REGISTERED BANK DISCLOSURES

75
B1. GENERAL DISCLOSURES (UNAUDITED) (continued)
Credit rating
The Ultimate Parent Bank has three credit ratings, which are applicable to its long-term senior unsecured obligations which are payable in New
Zealand in New Zealand dollars.
Fitch Ratings changed the outlook on the Ultimate Parent Bank from Negative to Stable on 12 April 2021. S&P Global Ratings changed the outlook on
Ultimate Parent Bank from Negative to Stable on 7 June 2021.
As at 11 November 2022, the Ultimate Parent Bank’s credit ratings are:

Rating agency Credit rating Qualification
S&P Global Ratings
AA- Outlook Stable
Fitch Ratings
A+ Outlook Stable
Moody’s Investors Service
Aa3 Outlook Stable
The following table describes the credit rating grades available. The descriptions are from S&P Global Ratings. Credit ratings from S&P Global Ratings
and Fitch Ratings may be modified by the addition of "+" or "-" to show the relative standing within the “AA” to “B” categories. Moody's Investors
Service applies numerical modifiers 1, 2, and 3 to each of the “Aa” to “Caa” classifications, with 1 indicating the higher end and 3 the lower end of the
rating category.

S&P Global
Ratings
Moody's
Investors
Service
Fitch
Ratings
Investment grade:
Extremely strong capacity to meet financial commitments. Highest rating. AAA Aaa AAA
Very strong capacity to meet financial commitments. AA Aa AA
Strong ability to meet financial commitments, but somewhat susceptible to adverse economic conditions and
changes in circumstances.
A A A
Adequate capacity to meet financial commitments, but more subject to adverse economic conditions.
BBB Baa BBB
Speculative grade:
Less vulnerable in the near-term but faces major ongoing uncertainties to adverse business, financial and economic
conditions.
BB Ba BB
More vulnerable to adverse business, financial and economic conditions but currently has the capacity to meet
financial commitments.
B B B
Currently vulnerable and dependent on favourable business, financial and economic conditions to meet financial
commitments.
CCC Caa CCC
Highly vulnerable; default has not yet occurred, but is expected to be a virtual certainty.
CC to C Ca CC to C
Payment default on a financial commitment or breach of an imputed promise; also used when a bankruptcy petition
has been filed or similar action taken.
D C RD & D
Financial statements of the Ultimate Parent Bank and Overseas Banking Group
Copies of the most recent publicly available financial statements of the Ultimate Parent Bank and Overseas Banking Group will be provided
immediately, free of charge, to any person requesting a copy where request is made at the Registered Office. The most recent publicly available
financial statements for the Ultimate Parent Bank and Overseas Banking Group can also be accessed at the website shareholder.anz.com.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

REGISTERED BANK DISCLOSURES

76
B1. GENERAL DISCLOSURES (UNAUDITED) (continued)
Historical summary of financial statements

Income statement

2022 2021 2020 2019 2018
For the year ended 30 September NZ$m NZ$m NZ$m NZ$m NZ$m
Interest income
5,824
4,608 5,580 6,508 6,550
Interest expense
(2,062)
(1,203) (2,349) (3,276) (3,373)
Net interest income
3,762
3,405 3,231 3,232 3,177
Non-interest income
1,117
759 789 966 1,143
Operating income
4,879
4,164 4,020 4,198 4,320
Operating expenses (1,654) (1,622) (1,754) (1,609) (1,517)
Credit impairment release / (charge)
(39) 115 (401) (99) (53)
Profit before income tax
3,186
2,657 1,865 2,490 2,750
Income tax expense
(887)
(738) (529) (665) (764)
Profit after income tax 2,299
1,919 1,336 1,825 1,986

Balance sheet
2022 2021 2020 2019 2018
As at 30 September NZ$m NZ$m NZ$m NZ$m NZ$m
Total assets
201,439
185,072 180,087 170,492 161,416
Total individually impaired assets
146
155 363 287 323
Total impaired assets (i.e. Stage 3)
736
775 1,173 739 n/a
Total liabilities 185,417 169,996 166,077 157,893 150,180
Equity & head office account
15,472 15,076 14,010 12,599 11,236
Non-controlling interests
550 - - - -

Other items included in Equity & head office account

Dividends paid (1,880) (845) - (375) (4,600)
NZ Branch retained earnings repatriated

- - - - (450)
Share capital issued
- - - - 3,000

The amounts included in this summary have been taken from the audited financial statements of ANZ New Zealand.

REGISTERED BANK DISCLOSURES
77
B2. ADDITIONAL FINANCIAL DISCLOSURES
Additional information on the balance sheet
2022 2021
NZ$m NZ$m
Total interest earning and discount bearing assets 180,054 171,167
Total interest and discount bearing liabilities 147,987 138,509
Total liabilities of the NZ Branch less amounts due to related entities
1,135
1,048
Additional information on interest rate sensitivity
The following table represents the interest rate sensitivity of ANZ New Zealand's assets, liabilities and off-balance sheet instruments by showing the
periods in which these instruments may reprice, that is, when interest rates applicable to each asset or liability can be changed.
Total
Up to
3 months
Over 3 to
6 months
Over 6 to
12 months
Over 1 to
2 years
Over
2 years
Not bearing
interest
1

2022 NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m NZ$m
A
ssets
Cash and cash equivalents 12,575 11,856 - - - - 719
Settlement balances receivable
785 - - - - -785
Collateral paid 1,672 1,672 - - - - -
Trading securities 7,228 1,202 446 532 1,002 4,046 -
Derivative financial instruments 15,478 - - - - -15,478
Investment securities 11,357 13 369 1,157 1,267 8,550 1
Net loans and advances 147,373 61,247 13,125 30,903 28,962 13,705 (569)
Other financial assets 952 - - - - -952
Total financial assets 197,420 75,990 13,940 32,592 31,231 26,301 17,366
Liabilities
Settlement balances payable
4,887 3,847 - - - - 1,040
Collateral received 1,962 1,962 - - - - -
Deposits and other borrowings
142,482 89,181 12,480 13,844 2,667 2,930 21,380
Derivative financial instruments
13,571 - - - - -13,571
Debt issuances
20,483 706 2,370 2,281 3,410 11,716 -
Lease liabilities
229 12 11 23 44 139 -
Other financial liabilities
898 364 - - - - 534
Total financial liabilities
184,512 96,072 14,861 16,148 6,121 14,785 36,525
Hedging instruments -(4,655)3,935 8,731 (11,545) 3,534 -
Interest sensitivity gap
12,908 (24,737) 3,014 25,175 13,565 15,050 (19,159)
1 Excludes non-coupon bearing discounted financial assets and financial liabilities which are shown as repricing on their maturity date.
Overseas Banking Group Profitability and Size
2022
Net profit for the year ended 30 September 2022 (AUDm)
1

7,120
Net profit after tax for the year ended 30 September 2022 as a percentage of average total assets 0.69%
Total assets (AUDm) 1,085,729
Percentage change in total assets in the 12 months to 30 September 2022 10.92%
1 Net profit after tax for the year includes AUD 1 million of profit attributable to non-controlling interests.
Reconciliation of mortgage related amounts
As at 30 September 2022 Note NZ$m
Term loans - housing
1
11 104,178
Less: housing loans made to corporate customers
(1,304)
On-balance sheet residential mortgage exposures (per LVR analysis) B4
102,874
Add: off-balance sheet residential mortgage exposures (per LVR analysis) B4
9,108
Total residential mortgage exposures (per LVR analysis)
B4
111,982
1 Term loans – housing includes loans secured over residential property for owner-occupier, residential property investment and business purposes.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT
REGISTERED BANK DISCLOSURES
78
B3. ASSET QUALITY
This section should be read in conjunction with the estimates, assumptions and judgements included in Note 1, Note 12 and Note 15 to the financial
statements.
Movements in co
mponents of loss allowance – total
Stage 3
Stage 1 Stage 2
Collectively
assessed
Individually
assessed Total
Net loans and advances - total NZ$m NZ$m NZ$m NZ$m NZ$m
As at 1 October 2021 155 314 56 60 585
Transfer between stages
18 (10)(3)(5)-
New and increased provisions (net of collective provision releases)
26 7 6 87 126
Write-backs - - - (33)(33)
Recoveries of amounts previously written off - - - (37)(37)
Credit impairment charge / (release)
44 (3)3 12 56
Bad debts written-off (excluding recoveries)
- - -(37)(37)
Add back recoveries of amounts previously written off
- - -37 37
Discount unwind
- - -5 5
As at 30 September 2022 199 311 59 77 646
Off-balance sheet credit related commitments - total
As at 1 October 2021 64 39 4 15 122
Transfer between stages
7 (6)(1)- -
New and increased provisions (net of collective provision releases) (5)(2)-(10)(17)
Credit impairment charge / (release)
2 (8)(1)(10)(17)
As at 30 September 2022 66 31 3 5 105
Impacts of changes in gross financial assets on loss allowances
Gross loans and advances - total
As at 1 October 2021 134,302 6,208 620 155 141,285
Net transfers in to each stage -1,160114 5 1,279
Amounts drawn from new or existing facilities 36,623 1,15388 146 38,010
Additions 36,623 2,313 202 151 39,289
Net transfers out of each stage
(1,257) (2)(18)(2)(1,279)
Amounts repaid
(29,696) (1,609) (214)(121)(31,640)
Deletions
(30,953) (1,611) (232)(123)(32,919)
Amounts written off
- - - (37)(37)
As at 30 September 2022 139,972 6,910 590 146 147,618
Loss allowance as at 30 September 2022 199 311 59 77 646
Off-balance sheet credit related commitments - total
As at 1 October 2021 28,568 1,279 32 23 29,902
Net transfers in to each stage
110 21 4 11 146
New and increased facilities and drawn amounts repaid 6,758 79 2 (5)6,834
Additions 6,868 100 6 6 6,980
Net transfers out of each stage (23)(123)- - (146)
Reduced facilities and amounts drawn (6,444) (261)(24)(23)(6,752)
Deletions (6,467) (384)(24)(23)(6,898)
As at 30 September 2022 28,969 995 14 6 29,984
Loss allowance as at 30 September 2022 66 31 3 5 105
Explanation of how changes in the gross carrying amounts of gross loans and advances contributed to changes in loss allowance
Overall, loss allowances are 0.42% of gross balances as at 30 September 2022, up from 0.41% as at 30 September 2021. The NZ$44 million (6.2%)
increase in loss allowances was driven by an increase in the proportion of gross balances in Stage 2, and changes in the forward-looking economic
scenarios as described in Note 12 allowance for expected credit losses.

REGISTERED BANK DISCLOSURES
79
B3. ASSET QUALITY (continued)
Movements in components of loss allowance – total
Stage 3
Stage 1 Stage 2
Collectively
assessed
Individually
assessed
Total
Net loans and advances - total NZ$m NZ$m NZ$m NZ$m NZ$m
As at 1 October 2020
161 347 80 107 695
Transfer between stages 16 (14) (2) - -
New and increased provisions (net of collective provision releases) (22) (19) (22) 67 4
Write-backs - -- (64) (64)
Recoveries of amounts previously written off - -- (18) (18)
Credit impairment release (6) (33) (24) (15) (78)
Bad debts written-off (excluding recoveries) - -- (47) (47)
Add back recoveries of amounts previously written off - -- 18 18
Discount unwind - -- (3) (3)
As at 30 September 2021 155 314 56 60 585
Off-balance sheet credit related commitments - total
As at 1 October 2020
79 55 3 22 159
Transfer between stages 3 (4) 1 - -
New and increased provisions (net of collective provision releases) (18) (12) - (7) (37)
Credit impairment charge / (release) (15) (16) 1 (7) (37)
As at 30 September 2021
64 39 4 15 122
Impacts of changes in gross financial assets on loss allowances
Gross loans and advances - total
As at 1 October 2020 120,371 11,841 810 363 133,385
Net transfers in to each stage 3,342 - 25 8 3,375
Amounts drawn from new or existing facilities 45,506 1,140 86 139 46,871
Additions 48,848 1,140 111 147 50,246
Net transfers out of each stage (2) (3,243) (17) (113) (3,375)
Amounts repaid (34,915) (3,530) (284) (195) (38,924)
Deletions (34,917) (6,773) (301) (308) (42,299)
Amounts written off - - - (47) (47)
As at 30 September 2021 134,302 6,208 620 155 141,285
Loss allowance as at 30 September 2021 155 314 56 60 585
Off-balance sheet credit related commitments - total
As at 1 October 2020
29,251 1,455 19 41 30,766
Net transfers in to each stage 28 - 11 1 40
New and increased facilities and drawn amounts repaid 8,796 314 12 1 9,123
Additions 8,824 314 23 2 9,163
Net transfers out of each stage (9) (31) - - (40)
Reduced facilities and amounts drawn (9,498) (459) (10) (20) (9,987)
Deletions (9,507) (490) (10) (20) (10,027)
As at 30 September 2021
28,568 1,279 32 23 29,902
Loss allowance as at 30 September 2021
64 39 4 15 122
Explanation of how changes in the gross carrying amounts of gross loans and advances contributed to changes in loss allowance
Overall, loss allowances are 0.41% of gross balances as at 30 September 2021, down from 0.52% as at 30 September 2020. The NZ$147 million (17.2%)
decrease in loss allowances was driven by a decrease in the proportion of gross balances in Stage 2 and Stage 3, and changes in the forward-looking
economic scenarios.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT
REGISTERED BANK DISCLOSURES
80
B3. ASSET QUALITY (continued)
Past due assets
2022 2021
NZ$m NZ$m
Less than 30 days past due
861
716
At least 30 days but less than 60 days past due
342
292
At least 60 days but less than 90 days past due
142
175
At least 90 days past due 454 374
Total past due but not individually impaired 1,799
1,557
Other asset quality information
2022 2021
NZ$m NZ$m
Undrawn facilities with impaired customers 6 23
Other assets under administration
5
3
Asset quality for financial assets designated at fair value
ANZ New Zealand does not have any loans and advances designated at fair value.
Overseas Banking Group asset quality
As at 30 September 2022
Gross impaired assets (AUDm) 1,445
Gross impaired assets as a percentage of total assets 0.1%
Individual provision (AUDm) 542
Individual provision as a percentage of gross impaired assets 37.5%
Collective provision (AUDm) 3,853

REGISTERED BANK DISCLOSURES
81
B4. CREDIT AND MARKET RISK EXPOSURES AND CAPITAL ADEQUACY ( UNAUDITED)
APRA Basel III capital ratios
Overseas Banking Group
Ultimate Parent Bank
(Extended Licensed Entity)
2022 2021 2022 2021
Common equity tier 1 capital
12.3%
12.3%
12.0%
12.0%
Tier 1 capital
14.0%
14.3%
14.0%
14.1%
Total capital
18.2%
18.4%
18.9%
18.6%
The Ultimate Parent Bank and the Overseas Banking Group are required to hold minimum capital as determined by APRA, which is at least equal to
that specified under the Basel III capital framework.
APRA has authorised the Ultimate Parent Bank and the Overseas Banking Group to use:
•the Advanced Internal Ratings Based (AIRB) methodology for calculation of credit risk weighted assets. Where the Overseas Banking Group is not
accredited to use the AIRB methodology the Overseas Banking Group applies the standardised approach.
•the Advanced Measurement Approach (AMA) for the operational risk weighted asset equivalent.
The Overseas Banking Group exceeded the minimum capital requirements set by APRA as at 30 September 2022 and for the comparative prior
periods.
The Overseas Banking Group is required to publicly disclose Pillar 3 financial information as at 30 September 2022. The Overseas Banking Group’s Pillar
3 disclosure document for the quarter ended 30 September 2022, in accordance with APS 330: Public Disclosure of Prudential Information, discloses
capital adequacy ratios and other prudential information. This document can be accessed at the website anz.com.
Market risk
ANZ New Zealand’s aggregate market risk exposures below have been calculated in accordance with BPR140: Market Risk. The peak end-of-day market
risk exposures are for the six months ended 30 September 2022.
Implied risk weighted
exposure Notional capital charge
Period end Peak Period end Peak
As at 30 September 2022 NZ$m NZ$m NZ$m NZ$m
Interest rate risk 6,329 6,540 506 523
Foreign currency risk
24 93 2 7
Equity risk
1 1 - -
Additional mortgage information
As required by RBNZ, LVRs are calculated as the current exposure secured by a residential mortgage divided by ANZ New Zealand's valuation of the
security property at origination of the exposure. Off-balance sheet exposures include undrawn and partially drawn residential mortgage loans as well
as commitments to lend. Commitments to lend are formal offers for housing lending which have been accepted by the customer.
On-
balance
sheet
Off-
balance
sheet Total
As at 30 September 2022 NZ$m NZ$m NZ$m
LVR range
Does not exceed 60%
56,785 6,857 63,642
Exceeds 60% and not 70%
19,708 1,039 20,747
Exceeds 70% and not 80%
20,135 927 21,062
Does not exceed 80%
96,628 8,823 105,451
Exceeds 80% and not 90%
4,703 101 4,804
Exceeds 90% 1,543 184 1,727
Total 102,874 9,108 111,982

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT
REGISTERED BANK DISCLOSURES
82
B5. INSURANCE BUSINESS, SECURITISATION, FUNDS MANAGEMENT, OTHER FIDUCIARY ACTIVITIES
AND MARKETING AND DISTRIBUTION OF INSURANCE PRODUCTS
Insurance business
ANZ New Zealand does not conduct any insurance business.
Non-consolidated insurance and non-financial activities
The Ultimate Parent Bank does not carry on any insurance business or non-financial activities in New Zealand that are outside ANZ New Zealand.
ANZ New Zealand’s involvement in securitisation, funds management, other fiduciary activi
ties, and marketing and distribution of insurance
products
a)ANZ New Zealand’s involvement in the establishment, marketing, or sponsorship of trust, custodial, funds management, and other fiduciary activities
Activity Details
Custodial
ANZ New Zealand operates two custodians as at 30 September 2022:
•ANZ Custodial Services New Zealand Limited, which is the appointed custodian for private banking’s (ANZ Private)
Discretionary Investment Management Service, Wholesale Investment Services and Trading Service; and
•ANZ New Zealand Investments Nominees Limited, which is the appointed custodian for direct holdings of securities by
various wholesale customer portfolios managed by ANZ New Zealand Investments Limited (ANZ Investments).
Funds
management
ANZ New Zealand provides the following funds management services:
•Managed Investment Schemes (MIS): ANZ New Zealand’s subsidiaries ANZ Investments and ANZ Investment Services (New
Zealand) Limited (ANZIS) act as manager for a number of managed investment schemes. ANZ Investments holds an MIS
Manager licence, with ANZIS being an authorised body under that licence. ANZ Investments is the issuer and manager of
ANZ and OneAnswer-branded KiwiSaver, retail and wholesale schemes. ANZIS is the issuer and manager of the Bonus
Bonds Scheme and the ANZ PIE Fund. ANZ National Staff Superannuation Limited, also a subsidiary of ANZ New Zealand,
is the trustee and manager of the ANZ National Retirement Scheme, which is a restricted workplace savings scheme.
•Discretionary Investment Management Service (DIMS): The Bank is a licensed DIMS provider. This service is offered to ANZ
Private customers.
•Other investment portfolios: ANZ Investments also manages investment portfolios for a number of schemes where the
scheme manager or trustee has outsourced investment management services to ANZ Investments. These schemes are
typically corporate superannuation schemes.
Other fiduciary
activities
ANZ Investments, through its subsidiary OneAnswer Nominees Limited, offers the OneAnswer Portfolio Service. The associated
administration and custody services are provided by FNZ Limited and FNZ Custodians Limited respectively (together FNZ).
FNZ is not a member or related party of ANZ New Zealand.
b)A
NZ New Zealand’s involvement in the origination of securitised assets, and the marketing or servicing of securitisation schemes
ANZ New Zealand originates securitised assets in the form of residential mortgage backed securities held for potential repurchase transactions with
RBNZ, and covered bonds. Refer to Note 24 structured entities for further details about these programmes. Other than these activities, ANZ New
Zealand is not involved in the marketing or servicing of securitisation schemes.
c)ANZ New Zealand’s involvement in marketing and distribution of insurance products
ANZ New Zealand markets and distributes life insurance, other personal and business insurance products provided by or arranged through a number
of insurance partners. None of these insurance partners are affiliated insurance entities or affiliated insurance groups. Our insurance partners are:
•Vero Insurance New Zealand Limited for home, contents, motor vehicle, boat and lifestyle block insurance;
•AWP Services New Zealand Limited, trading as Allianz Partners, for premium card travel insurance. Policies are underwritten by Allianz Australia
Insurance Limited (incorporated in Australia) trading as Allianz New Zealand;
•Cigna Life Insurance New Zealand Limited for life & living insurance; and
•Crombie Lockwood (NZ) Limited is our business insurance broker.
Arrangements to ensure no adverse impacts arising from the above activities
Arrangements have been put in place to ensure that difficulties arising from the activities in a), b) and c) above would not impact adversely on ANZ
New Zealand. The policies and procedures in place include comprehensive and prominent disclosure of information regarding products, and formal
and regular review of operations and policies by management.

REGISTERED BANK DISCLOSURES
83
B5. INSURANCE BUSINESS, SECURITISATION, FUNDS MANAGEMENT, OTHER FIDUCIARY ACTIVITIES
AND MARKETING AND DISTRIBUTION OF INSURANCE PRODUCTS
(continued)
Amounts represented by funds management and securitisation activities
2022 2021
NZ$m NZ$m
Funds under management:
KiwiSaver
1
17,076 19,051
Bonus Bonds Scheme
2,6
-872
Other managed funds
1

3,353
3,842
ANZ PIE Fund
2

2,292
1,724
DIMS
3

7,490
8,868
Other investment portfolios
4

4,102
4,686
Total funds under management 34,313
39,043
Funds under custodial arrangements 7,519 8,942
Other funds held or managed subject to fiduciary responsibilities
5
1,710 1,811
Outstanding securitised assets originated by ANZ New Zealand - carrying amount of covered bonds
4,082 4,248
1 Managed by ANZ Investments.
2 Managed by ANZIS.
3 Managed by the Bank.
4 Comprises portfolios managed by ANZ Investments, and the ANZ National Retirement Scheme managed by ANZ National Staff Superannuation Limited.
5 Not included in funds under management.
6 Funds under management for the Bonus Bonds Scheme is net of NZ$65 million (2021: nil) of distributions payable to bondholders. Further information about the wind-up of the Bonus
Bonds Scheme is available at the website bonusbonds.co.nz.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT
REGISTERED BANK DISCLOSURES
84
B6. RISK MANAGEMENT POLICIES
Information about risk
The evolving macroeconomic and geopolitical conditions have continued to challenge our operating environment. Our Risk Management Framework
(RMF) has remained robust in the face of these challenges, enabling the sound management of our business.
The Board is ultimately responsible for establishing and overseeing ANZ New Zealand’s RMF, which is supported by ANZ New Zealand’s
underlying systems, structures, policies, procedures, processes and people. The Board has delegated authority to the Bank’s Board Risk
Committee (BRC) to develop and monitor compliance with ANZ New Zealand’s risk management policies. The Committee reports regularly
to the Board on its activities. The key pillars of ANZ New Zealand’s RMF include:
•The Risk Management Strategy (RMS), which describes the approach for managing risks arising from ANZ New Zealand’s purpose
and strategy. The RMS includes: how the risk function is structured to support ANZ New Zealand’s purpose and strategy; the values,
attitudes and behaviours required of employees in delivering on strategic priorities; a description of each material risk; and a
n
overview of how the RMF addresses each risk, with reference to the relevant policies, standards and procedures. It also includes
information on how ANZ New Zealand identifies, measures, evaluates, monitors, reports and then either controls or mitigates
material risks and the oversight mechanism and/or committees in place.
•The Risk Appetite Statement (RAS), which sets out the Board’s expectations regarding, for each material risk, the maximum level of
risk ANZ New Zealand is willing to accept in pursuing its strategic objectives and its operating plans considering its stakeholders’,
depositors’ and customers’ interests.
•The Risk Culture principles, which are a subset of ANZ New Zealand’s organisational culture and an intrinsic part of ANZ New Zealand’s
RMF.
The material risks facing ANZ New Zealand per our RMS, and how these risks are managed, are summarised below.
Key material risks
Each key material risk has an associated RAS component, and where applicable, is measured by appropriate metric(s) and associated tolerance(s)
representing the maximum level of risk appropriate to execute ANZ New Zealand’s strategic agenda. Metrics are prepared and reviewed at least
monthly. A risk appetite dashboard is prepared and reviewed by senior management monthly, and presented to the BRC at each meeting.
Risk type Description Managing the risk
Strategic
Risk
Risks that affect or are created by an organisation’s business
strategy and strategic objectives. A possible source of loss
might arise from the pursuit of an unsuccessful business
plan. For example, Strategic risk might arise from making
poor strategic business decisions, from the sub-standard
execution of decisions, or from a failure to respond well to
changes in a business environment.
Strategic risks are discussed and managed through our annual
strategic planning process, managed by the Executive Committee
and approved by the Board. Where the strategy leads to an increase
in other Key Material Risks (e.g. Credit Risk, Market Risk, Operational
Risk) the risk management strategies associated with these risks form
the primary controls.
Capital
Adequacy
Risk
The risk of loss arising from ANZ New Zealand failing to
maintain the level of capital required by prudential
regulators and other key stakeholders (shareholders, debt
investors, depositors, rating agencies, etc.) to support ANZ
New Zealand’s consolidated operations and risk appetite.
We pursue an active approach to Capital Management, which is
designed to protect the interests of depositors, creditors and
stakeholders through ongoing review, and Board approval, of the
level and composition of our capital base against key policy
objectives. The ICAAP also operates as part of the management
framework for this risk.
Credit
Risk
The risk of financial loss resulting from:
• a counterparty failing to fulfil its obligations; or
•a decrease in credit quality of a counterparty resulting
in a financial loss.
Credit Risk incorporates the risks associated with our
lending to business and retail customers who could be
impacted by climate change or by changes to laws,
regulations, or other policies adopted by governments or
regulatory authorities, including carbon pricing and climate
change adaptation or mitigation policies.
Includes:
•concentrations of credit risk;
•intra-day credit risk;
•credit risk to bank counterparties; and
•related party credit risk.
Our Credit Risk framework is top down, being defined by credit
principles and policies. Credit policies, requirements and procedures
cover all aspects of the credit life cycle from initial approval and risk
grading, through ongoing management and problem debt
management.
The effectiveness of the Credit Risk framework is assessed through
various compliance and monitoring processes. These, together with
portfolio selection, define and guide the credit process, organisation
and staff.
Liquidity
and
Funding
Risk
The risk that ANZ New Zealand is unable to meet its
payment obligations as they fall due, including:
•repaying depositors or maturing wholesale debt; or
•ANZ New Zealand having insufficient capacity to fund
increases in assets.
Key principles in managing our Liquidity and Funding Risk include:
•ANZ New Zealand’s short term liquidity scenario modelling
stresses cash flow projections against multiple survival horizons’
over which ANZ New Zealand is required to remain cash flow
positive; and
•longer-term scenarios are in place that measure the structural
liquidity position of the balance sheet.

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B6. RISK MANAGEMENT POLICIES (continued)
Risk type Description Managing the risk
Market
Risk
The risk stems from our trading and balance sheet activities
and is the risk to ANZ New Zealand’s earnings arising from:
•changes in any interest rates, foreign exchange rates,
credit spreads, volatility, and correlations; or
•fluctuations in bond, commodity or equity prices.
We have a detailed market risk management and control framework
to support our trading and balance sheet activities, which
incorporates an independent risk measurement approach to
quantify the magnitude of market risk within the trading and balance
sheet portfolios. This approach, along with related analysis, identifies
the range of possible outcomes, that can be expected over a given
period of time, and establishes the likelihood of those outcomes and
allocates an appropriate amount of capital to support these activities.
ANZ New Zealand’s key tools to measure and manage Market Risk on
a daily basis include value at risk, earnings at risk, interest rate
sensitivities, market value loss limits and stress testing.
Operational
Risk
The risk of loss and/or non-compliance with laws resulting
from inadequate or failed internal processes, people and/or
systems, or from external events. This definition includes
legal risk, and the risk of reputation loss, but excludes
strategic risk.
We manage Compliance and Operational Risk in the best interests of
our customers and the community and to meet expectations of the
regulators. The Compliance and Operational Risk Principles (Level 1)
establish the fundamental requirements at ANZ New Zealand which
inform policies, processes, and procedure development of ANZ New
Zealand’s management of Compliance and Operational Risk,
through timely and appropriate identification, action and
monitoring. It is part of ANZ New Zealand’s RMF and ANZ New
Zealand’s I.AM (Identify, Act, Monitor) Framework (Level 2). We take a
risk-based approach to the management of operational risk and
obligations. This enables ANZ New Zealand to be consistent in
proactively identifying, assessing, managing, reporting and
escalating operational risk-related risk exposures.
Day-to -day management of operational risk is the responsibility of
business unit line management and staff. Risk management,
supported by a strong Risk Culture, helps to seek to ensure all staff
are thinking about and managing risk on a daily basis – “Risk is
Everyone’s Responsibility”.
Compliance Risk
The risk of failure to act in accordance with laws,
regulations, industry standards and codes, internal policies
and procedures and principles of good governance as
applicable to ANZ New Zealand’s businesses.
Key features of how we manage Compliance Risk as part of our
Operational Risk and Compliance Framework include:
•centralised management of key obligations;
•an emphasis on identification of changing regulations and the
business environment, to enable proactive assessment of
emerging compliance risk; and
•recognition of incident management as a separate element to
enhance ANZ New Zealand’s ability to identify, manage and
report on incidents/breaches in a timely manner.
Conduct Risk
The risk of loss or damage arising from the failure of ANZ
New Zealand, its employees or agents to appropriately
consider the interests of customers, the integrity of the
financial markets and the expectations of the community in
conducting its business activities. The risk may arise not
only from deliberate or negligent actions of individual
employees, but may also be inadvertent and caused by
inadequacies in ANZ New Zealand’s systems, processes and
procedures.
Our approach to managing Conduct Risk is to seek to ensure that
risks to customers, community and market integrity are identified,
assessed, measured, evaluated, treated, monitored and reported with
appropriate governance and oversight.
The articulation of Conduct Risk as a Level 1 Risk Theme under the
new Non-Financial Risk (NFR) model will help manage Conduct Risk
as a key material risk for ANZ New Zealand. To support the NFR
model, ANZ New Zealand has developed a Conduct Risk Framework
and Conduct Risk taxonomy which facilitate a clear and consistent
way of managing and monitoring the risk, and the risk is managed in
conjunction with the Compliance and Operational Risk Framework
(I.AM).
Technology Risk
The risk of loss and/or non-compliance with laws from
inadequate or failed internal processes, people or systems
that deliver technology assets and services to customers
and staff. This risk includes technology assets and services
delivered or managed by third parties, and external events.
The risk specifically includes information security and cyber
security and how information held by ANZ New Zealand
needs to be protected from inappropriate modification,
loss, disclosure and unavailability.
Our approach to managing Technology Risk is to manage our
operational risks caused by the use of technology, including risks
associated with cyber security and third party providers, in a manner
that seeks to ensure customer information is secure and service
disruption is within acceptable levels.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT
REGISTERED BANK DISCLOSURES
86
B6. RISK MANAGEMENT POLICIES (continued)
Risk type Description Managing the risk
Financial
Crime
Risk
Financial Crime Risk covers the following risks at ANZ New
Zealand:
•Money Laundering (ML) Risk – the risk that we may
reasonably face from our products and/or services
being misused to facilitate the processing of the
proceeds of crime to conceal their illegal origins and
make them appear legitimate.
•Terrorism Financing (TF) Risk – the risk that we may
reasonably face from our products and/or services
being misused to facilitate the provision or collection of
funds with the intention or knowledge that they may
be used to carry out acts associated in support of
terrorists or terrorist organisations.
•Sanctions Risk – the risk of failing to comply with laws
and regulations relating to sanctions imposed by
governments and multinational bodies as a result of
our products and services being misused to facilitate
prohibited sanctions activities.
•Fraud Risk – the risk that we may reasonably face from
our products and/or services being misused to facilitate
intentional acts by one or more individuals, involving
the use of deception to obtain an unjust or illegal
advantage arising from internal or external sources.
Financial Crime Risk at ANZ New Zealand is managed using a risk-
based approach in conjunction with the Compliance and
Operational Risk Framework (I.AM) and a three lines of defence
model. In addition to a risk-based approach to risk management, for
Sanctions there is a rules-based lens to ensure compliance with
Sanctions legislation. For the Business to identify and manage
Financial Crime Risk, it must identify its regulatory obligations and
impacted business activities and maintain and monitor key controls.
Refer to Note 15 financial risk management for the disclosures required under NZ IFRS 7 Financial Instruments: Disclosures.
Other material risks
Other material risks do not require the same degree of active or transactional management as the Key material risks and are managed and monitored
as part of ANZ New Zealand’s business, strategic and capital management process. The maximum level of risk is set as part of the Banking Group’s
ICAAP. Refer to Note 22 capital management for more information about the Banking Group’s ICAAP.
Pension
Risk
The risk of the value of investments in a defined benefit pension fund being insufficient to meet liabilities, resulting in additional
funds being required to match pension liabilities.
Strategic
Equity Risk
The risk of financial loss arising from the unexpected reduction in value of ANZ New Zealand equity investments not held in the
trading book, including ANZ New Zealand’s joint ventures and associates.
Fixed Asset
Risk
The risk of financial loss arising from the negative revaluation of fixed assets owned and leased by ANZ New Zealand, caused by
adverse changes in business and/or economic conditions. Residual Value Risk is included in the definition of Fixed Assets, which is
the risk that the market value of the underlying assets of operating leases may fall below the anticipated residual value.
Deferred
Acquisition
Costs Risk
The risk of loss arising from the failure of the benefits associated with the acquisition of interest earning assets to arise due to
impairment, transfer, or prepayment.
Software
Risk
The risk of financial loss arising from the unexpected accelerated write down of capitalised software expenditure due to
diminished future economic benefits caused by adverse business or economic conditions.
Goodwill
Risk
The risk of financial loss caused by the reduction in the net carrying value of acquired business resulting from lower than expected
future economic benefits due to adverse business and economic conditions.

REGISTERED BANK DISCLOSURES
87
B6. RISK MANAGEMENT POLICIES (continued)
Reviews of ANZ New Zealand’s risk management systems
Refer to Note 15 financial risk management for details of the Internal Audit Functions reviews of ANZ New Zealand’s RMF. These reviews are not
conducted by a party external to ANZ New Zealand, the Overseas Banking Group, or the Ultimate Parent Bank.
Internal Audit Function of ANZ New Zealand
ANZ New Zealand has an Internal Audit Function, refer to Note 15 financial risk management for details.
The nature and scope of the responsibilities of the Bank’s Audit Committee responsibilities, to which Internal Audit reports, are to assist the Bank’s
Board of Directors by providing oversight and review of:
•ANZ New Zealand's financial reporting principles and policies, controls, systems and procedures;
•the effectiveness of ANZ New Zealand’s internal control and risk management framework;
•the work and internal audit standards of Internal Audit which reports directly and solely to the Chair of the Bank’s Audit Committee;
•the integrity of ANZ New Zealand's financial statements and the independent audit thereof, and ANZ New Zealand’s compliance with legal and
regulatory requirements in relation thereto;
•any due diligence procedures;
•prudential supervision procedures and other regulatory requirements to the extent relating to financial reporting; and
•any other matters referred to it by the Bank’s Board.
The Bank’s Audit Committee is also responsible for:
•the appointment, annual evaluation and oversight of the external auditor;
•annual review of the independence, fitness and propriety, and qualifications of the external auditor;
•compensation of the external auditor; and
•where deemed appropriate, replacement of the external auditor.
In carrying out its responsibilities and duties, the Bank’s Audit Committee will aim to seek fair customer outcomes and financial market integrity in its
deliberations.
Access to parental disclosures
Disclosures made by the Ultimate Parent Bank in relation to capital adequacy requirements and risk management processes implemented by the
Ultimate Parent Bank are included in the Ultimate Parent Bank’s Annual Report and APS 330 Basel III Pillar 3 Capital Disclosures documents which can
be accessed at t he website shareholder.anz.com.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

DIRECTORS' AND NEW ZEALAND CHIEF EXECUTIVE OFFICER'S STATEMENT

88
As at the date on which this Disclosure Statement is signed, after due enquiry, each Director of the Ultimate Parent Bank and the Chief Executive
Officer – NZ Branch believes that:
• The Disclosure Statement contains all the information that is required by the Registered Bank Disclosure Statements (Overseas Incorporated
Registered Banks) Order 2014; and
• The Disclosure Statement is not false or misleading.
Over the year ended 30 September 2022, after due enquiry, each Director of the Ultimate Parent Bank and the Chief Executive Officer – NZ Branch
believes that:
• The Ultimate Parent Bank has complied in all material respects with each condition of registration that applied during that period
1
; and
• The NZ Branch and the Bank had systems in place to monitor and control adequately the material risks of Relevant Members of ANZ New
Zealand including credit risk, concentration of credit risk, interest rate risk, currency risk, equity risk, liquidity risk and other business risks, and that
those systems were being properly applied.
1 In accordance with the Order, Australia and New Zealand Banking Group Limited - ANZ New Zealand has complied in all material respects with each of its conditions of registration that
applied during the period if RBNZ has not published any information about a breach on its website, and has not notified Australia and New Zealand Banking Group Limited - ANZ New
Zealand of any material breach.

Signed by the Chief Executive Officer – NZ Branch

Chris O‘Neale
Chief Executive Officer – NZ Branch
11 November 2022

Signed on behalf of all the Directors of the Ultimate Parent Bank

Antonia Watson
Responsible Person
11 November 2022

on behalf of the Directors of the Ultimate Parent Bank:
Ilana Atlas, AO
Shayne Elliott
Jane Halton, AO PSM
Rt Hon Sir John Key, GNZM AC
Graeme Liebelt
John Macfarlane
Christine O’Reilly
Paul O’Sullivan
Jeff Smith

INDEPENDENT AUDITOR’S REPORT
89
TO THE DIRECTORS OF AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED
RE
PORT ON THE AUDIT OF THE ANZ NEW ZEALAND DISCLOSURE STATEMENT
OP
INION
We have audited the accompanying consolidated financial statements and registered bank disclosures of Australia and New Zealand Banking Group
Limited - ANZ Bank New Zealand and its related entities (ANZ New Zealand) in section B2, B3, B5 and B6 which comprise:
•the consolidated balance sheet as at 30 September 2022;
•the consolidated income statement, statements of comprehensive income, changes in equity and cash flows for the year then ended;
•notes, including a summary of significant accounting policies and other explanatory information; and
•the information that is required to be disclosed in accordance with Schedules 4, 7, 11 and 13 of the Registered Bank Disclosure Statements
(Overseas Incorporated Registered Banks) Order 2014 (as amended) (the Order).
In our opinion, the accompanying consolidated financial statements on pages 4 to 67:
•give a true and fair view of ANZ New Zealand’s financial position as at 30 September 2022 and its financial performance and cash
flows for the year ended on that date; and
•comply with New Zealand Generally Accepted Accounting Practice, which in this instance means New Zealand Equivalents to International
Financial Reporting Standards (NZ IFRS) and International Financial Reporting Standards.
In our opinion, the Registered Bank disclosures that are required to be disclosed in accordance with Schedules 4, 7, 11 and 13 of the Order are
included in section B2, B3, B5 and B6 of the Disclosure Statement:
•have been prepared, in all material respects, in accordance with the guidelines issued pursuant to section 78(3) of the Banking (Prudential
Supervision) Act 1989 and any conditions of registration;
•are in accordance with the books and records of ANZ New Zealand in all material respects; and
•fairly state the matters to which they relate in accordance with those Schedules.
In accordance with the requirements of clauses 2(1)(d) and 2(1)(e) of Schedule 1 of the Order, we report that:
•we have obtained all the information and explanations we have required; and
•in our opinion, proper accounting records have been kept by ANZ New Zealand, as far as appears from our examination of those records.
BASIS FOR OPINION
We conducted our audit in accordance with International Standards on Auditing (New Zealand) (ISAs (NZ)). We believe that the audit evidence we
have obtained is sufficient and appropriate to provide a basis for our opinion.
We are independent of ANZ New Zealand in accordance with Professional and Ethical Standard 1 International Code of Ethics for Assurance
Practitioners (including International Independence Standards) (New Zealand) issued by the New Zealand Auditing and Assurance Standards Board
and the International Ethics Standards Board for Accountants’ International Code of Ethics for Professional Accountants (including International
Independence Standards) (IESBA Code), and we have fulfilled our other ethical responsibilities in accordance with these requirements and the IESBA
Code.
Our responsibilities under ISA’s (NZ) are further described in the auditor’s responsibilities for the audit of the consolidated financial statements and
registered bank disclosures in section B2, B3, B5 and B6 section of our report.
Our firm has also provided other services to ANZ New Zealand in relation to review of regulatory returns, internal controls reports, prospectus
assurance or reviews and agreed upon procedures engagements. Subject to certain restrictions, partners and employees of our firm may also deal
with ANZ New Zealand on normal terms within the ordinary course of trading activities of the business of ANZ New Zealand. These matters have not
impaired our independence as auditor of ANZ New Zealand. The firm has no other relationship with, or interest in, ANZ New Zealand.
KEY AUDIT MATTERS
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the consolidated financial
statements in the current period. We summarise below those matters and our key audit procedures to address those matters in order that the
Directors as a body may better understand the process by which we arrived at our audit opinion. Our procedures were undertaken in the context of
and solely for the purpose of our statutory audit opinion on the consolidated financial statements as a whole and we do not express discrete opinions
on separate elements of the consolidated financial statements.
ALLOWANCE FOR EXPECTED CREDIT LOSSES ($751 MILLION)
Refer to the critical accounting estimates and judgements disclosures in relation to the allowance for expected credit losses in Note 12 to the Consolidated
Financial Statements.
The key audit matter
Allowance for expected credit losses is a key audit matter due to the significance of the loans and advances balance to the consolidated financial
statements and the inherent complexity of ANZ New Zealand’s Expected Credit Loss (ECL) models used to measure ECL allowances. These models are

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT
INDEPENDENT AUDITOR’S REPORT
90
reliant on data and a number of estimates including impacts of multiple economic scenarios, and other assumptions such as defining a Significant
Increase in Credit Risk (SICR).
NZ IFRS 9 requires ANZ New Zealand to measure ECL on a forward-looking basis reflecting a range of future economic conditions. Post-model
adjustments to the ECL results are also made by ANZ New Zealand to address known ECL model limitations or emerging trends in the loan portfolios.
We exercise significant judgement in challenging both the economic scenarios used and the judgemental overlays that ANZ New Zealand applies to
the ECL results.
Additional subjectivity and judgement has been introduced into ANZ New Zealand’s measurement of ECL due to the heightened uncertainty
associated with the impact of the economic outlook on ANZ New Zealand’s customers, increasing our audit effort thereon.
ANZ New Zealand’s criteria selected to identify a SICR, such as a decrease in customer credit rating (CCR), are key areas of judgement within ANZ New
Zealand’s ECL methodology as these criteria determine if a forward-looking 12 month or lifetime allowance is recorded.
Additionally, the determination of an allowance for individually assessed impairment on Business and Institutional (wholesale) loans requires
significant judgement in estimating the e xpected future cash repayments and proceeds from the value of the collateral held in respect of the loans.
How t
he matter was addressed in our audit
Our audit procedures for the allowance for ECL and disclosures included assessing ANZ New Zealand’s significant accounting policies against the
requirements of the accounting standard. KPMG Financial Risk Management and Economic specialists were used in ECL audit procedures as a core
part of our audit team.
We tested key controls in relation to:
•ANZ New Zealand’s ECL model governance and validation processes which involved assessment of model performance;
•ANZ New Zealand’s assessment and approval of the forward-looking macroeconomic assumptions and scenario weightings through challenge
applied by ANZ New Zealand’s internal governance processes;
•Reconciliation of the data used in the ECL calculation process to gross balances recorded within the general ledger as well as source systems;
•Counterparty risk grading for wholesale loans (larger customer exposures are monitored individually). We tested the approval of new lending
facilities against ANZ New Zealand’s lending policies, and controls over the monitoring of counterparty credit quality; and
•ANZ New Zealand’s oversight of the portfolios, with a focus on controls over delinquency monitoring.
We also tested relevant General Information Technology Controls over the key IT applications used by ANZ New Zealand in measuring ECL
allowances, as detailed in the IT Systems and Controls key audit matter below.
In a
ddition to controls testing, our procedures included:
•Re-performing credit assessments of a sample of wholesale loans controlled by ANZ New Zealand’s specialist workout and recovery team, who
assessed these as higher risk or impaired, and a sample of other loans, focusing on larger exposures assessed by ANZ N ew Zealand as showing
signs of deterioration, or in areas of emerging risk. For each loan sampled, we challenged ANZ New Zealand’s CCR and Security Indicator,
assessment of loan recoverability, valuation of security and the impact on the credit allowance. To do this, we reviewed the information on ANZ
New Zealand’s loan file, understood the facts and circumstances of the case with the relationship manager, and performed our own assessment
of recoverability. Exercising our judgement, our procedures included using our understanding of relevant industries and the macroeconomic
environment, and comparing data and assumptions used by ANZ New Zealand in recoverability assessments to externally sourced evidence,
such as external property sale information;
•Obtaining an understanding of ANZ New Zealand’s processes to determine ECL allowances, evaluating ANZ New Zealand’s ECL model
methodologies against established market practices and criteria in the accounting standards;
•Working with KPMG Financial Risk Management specialists, we assessed the accuracy of ANZ New Zealand’s ECL model estimates by re -
performing, for a sample of loans, the ECL allowance using our independently derived calculation tools and comparing this to the amount
recorded by ANZ New Zealand;
•W
orking with our KPMG Economic specialists, we challenged ANZ New Zealand’s forward-looking macroeconomic assumptions and scenarios
incorporated in ANZ New Zealand’s ECL models. We compared ANZ New Zealand’s forecast GDP and unemployment rates, to relevant publicly
available macro-economic information, and considered other known variables and information obtained through our other audit procedures to
identify contradictory indicators;
•Testing ANZ New Zealand’s SICR methodology by re -performing the staging calculation for a sample of loans taking into consideration
movements in the CCR from loan origination CCR and comparing our expectation to actual staging applied on an individual account level in
ANZ New Zealand’s ECL model; and
•Assessing the accuracy of the data used in the ECL models by confirming a sample of data fields such as account balance and CCR to relevant
source systems.
We also challenged key assumptions in the components of ANZ New Zealand’s post-model adjustments to the ECL allowance balance. This i ncluded:
•Assessing post-model adjustments against ANZ New Zealand’s ECL model and data deficiencies identified by ANZ New Zealand’s ECL model
validation processes, particularly in light of the significant volatility in economic scenarios;
•Evaluating underlying data used in concentration risk and economic cycle allowances by comparing underlying portfolio characteristics to loss
experience, current market conditions and specific risks inherent in ANZ New Zealand’s loan portfolios;
•A
ssessing the impacts on t he modelled ECL and the requirement for out of model adjustments. We also assessed assumptions used to
determine whether a SICR event has occurred; and
•Assessing the completeness of post-model adjustments by checking the consistency of risks we identified in the portfolios against ANZ New
Zealand’s assessment.
We assessed the appropriateness of ANZ New Zealand’s disclosures in the consolidated financial statements using our understanding obtained from
our testing and against the requirements of NZ IFRS.

INDEPENDENT AUDITOR’S REPORT
91
VALUATION OF FINANCIAL INSTRUMENTS
Fair value of Level 2 financial instruments in asset positions $17,493 million
Fair value of Level 2 financial instruments in liability positions $16, 506 million
Refer to the critical accounting estimates, judgements and disclosures of fair values in Note 16 to the Consolidated Financial Statements.
The key audit matter
The fair value of ANZ New Zealand’s financial instruments is determined by ANZ New Zealand through the application of valuation techniques which
often involve the exercise of judgement and the use of assumption and estimates.
The valuation of Level 2 financial instruments held at fair value is a key audit matter due to the complexity associated with the valuation methodology
and models of certain more complex Level 2 financial instruments leading to an increase in subjectivity and estimation uncertainty. Level 2 financial
instruments represent 51% of ANZ New Zealand’s financial assets carried at fair value and 98% of ANZ New Zealand’s financial liabilities c arried at fair
value.
How the matter was addressed in our audit
Our audit procedures for the valuation of financial instruments held at fair value included:
Performing an assessment of the population of financial instruments held at fair value to identify portfolios that have a higher risk of misstatement
arising from significant judgment over valuation either due to unobservable inputs or complex models.
We t
ested the design and operating effectiveness of key controls relating specifically to these financial instruments, including:
•Independent Price Verification (IPV), including completeness of portfolios and valuation inputs subject to IPV;
•Model validation at inception and periodically, including assessment of model limitation and assumptions;
•Review and challenge of daily profit and loss by a control function;
•Collateral management process, including review of margin reconciliations with clearing houses; and
•Review and approval of fair value adjustments (FVAs), including exit price and portfolio level adjustments.
With the assistance of KPMG valuation specialists, we independently revalued a selection of financial instruments and FVAs on level 2 instruments. This
involved sourcing independent inputs from market data providers or external sources and using our own valuation models. We challenged ANZ New
Zealand where our revaluations significantly differed from ANZ New Zealand’s valuations.
We assessed ANZ New Zealand’s consolidated financial statement disclosures, including key judgements and assumptions using our understanding
obtained from our testing and against NZ IFRS.
IT SYSTEMS AND CONTROLS
The key audit matter
As a major New Zealand bank, ANZ New Zealand’s businesses utilise a large number of complex, interdependent Information Technology (IT) systems
to process and record a high volume of transactions. The c ontrols over access, changes to and operations of IT systems are critical to the recording of
financial information and the preparation of financial statements which provide a true and fair view of ANZ New Zealand’s financial position and
performance. The IT systems and controls, as they impact the financial recording and reporting of transactions, is a key audit matter and our audit
approach could significantly differ depending on the effective operation of ANZ New Zealand’s IT controls.
How t
he matter was addressed in our audit
We tested the control environment for key IT applications used in processing significant transactions and recording balances in the general ledger. We
also tested automated controls embedded within these systems which support the effective operation of technology-enabled business processes.
KPMG IT specialists were used throughout the engagement as a core part of our audit team.
Our audit procedures included:
•Assessing the governance and higher-level controls in place across the IT environment, including the approach to ANZ New Zealand policy
design, review and awareness, and IT risk and cyber security management practices;
•Design and operating effectiveness testing of controls across the User Access Management Lifecycle, including how users are on-boarded,
reviewed, and removed on a timely basis from critical IT applications and supporting infrastructure. We also examined how privileged roles and
functions are managed across each IT application and the supporting infrastructure;
•Design and operating effectiveness testing of controls in place over change management, including how changes are initiated, documented,
approved, tested and authorised prior to migration into the production environment of critical IT applications. We also assessed the
appropriateness of users with access to make changes to IT applications across ANZ New Zealand and whether access was commensurate with
their job responsibilities;
•D
esign and operating effectiveness testing of controls used by ANZ New Zealand’s technology teams to schedule system jobs and monitor
system integrity;
•Design and operating effectiveness testing of controls related to significant IT application programs per the ANZ Delivery Framework; and
•Design and operating effectiveness testing of automated business process controls including those that enforce segregation of duties between
conflicting roles within IT applications, configurations in place to perform calculations, mappings, and flagging of financial transactions,
automated reconciliation controls (both between systems, and intra-system) and data integrity of critical system reporting used by us in our
audit to select samples and analysis data used by management to generate financial reporting.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT
INDEPENDENT AUDITOR’S REPORT
92
CARRYING VALUE OF GOODWILL ($3,006 MILLION)
Refer to the critical accounting estimates, judgements and disclosures in Note 19 to the Consolidated Financial Statements.
The key audit matter
The carrying value of goodwill is a key audit matter where there are a number of judgements required in the determination of the recoverable
amount of goodwill, and where the carrying value of goodwill is financially significant at the reporting date.
ANZ New Zealand uses a value-in -use (VIU) approach to estimate the recoverable amount of each Cash Generating Unit (CGU) to which goodwill is
allocated. The reasonableness of the recoverable amounts was assessed using an implied market-multiples approach.
The uncertainties associated with the economic outlook increases the potential for impairment and our audit effort in this area remains elevated.
There is increased judgement in forecasting cash flows and assumptions used in the discounted cash flow models and market-multiples used in the
reasonableness assessment.
We focused on the significant forward-looking assumptions ANZ New Zealand applied as part of its annual impairment test as at 28 February 2022,
including:
•Revenue growth rates, and terminal growth rates in the VIU model. Available headroom for some CGUs is sensitive to small changes in these
assumptions, reducing available headroom or indicating possible impairment. This drives additional audit effort specific to their feasibility and
consistency of application to ANZ New Zealand’s strategy; and
•Discount rates in the VIU model and the control premium in the market-multiples reasonableness assessment. These are complicated in nature
and vary according to the conditions and environment the specific CGU is subject to from time to time.
How the matter was addressed in our audit
We involved valuation specialists to supplement our senior team members in assessing this key audit matter.
Working with our valuation specialists, our procedures included:
•In accordance with accounting standards, assessing the reasonableness of the amounts allocated to the CGUs to which ANZ New Zealand
allocated goodwill;
•Considering the appropriateness of the valuation method applied by ANZ New Zealand to perform their annual test for impairment against the
requirements of the accounting standards;
•Assessing the integrity of the VIU model used by ANZ New Zealand, including the accuracy of the underlying calculation formulae;
•Assessing the accuracy of previous ANZ New Zealand forecasts to inform our evaluation of forecasts incorporated in the VIU model;
•For each CGU, assessing ANZ New Zealand’s key assumptions used in the VIU model, including discount rates, revenue growth rates, and
terminal growth rates by comparing to external observable metrics, historical experience, our knowledge of the markets and current market
practice;
•Stress testing key VIU assumptions to consider reasonably possible alternatives;
•Comparing the forecast cash flows contained in the model to the revised Operational forecast, reflecting the higher interest rate environment,
the increased regulatory minimum capital requirements and economic outlook;
•Assessing key assumptions used in the market-multiples reasonableness assessment, which we assessed as being equivalent to a fair value less
costs of disposal approach. These assumptions included future maintainable earnings, the control premium comparing the implied multiples
from comparable market transactions to the implied multiples used in the VIU model;
•Determining whether there is sufficient appropriate evidence to support ANZ New Zealand’s conclusion that there is no impairment in goodwill
associated with any CGU;
•Assessing the reasonableness of ANZ New Zealand’s review for potential internal and external indicators of impairment. This review considered
the period from the annual impairment test as at 28 February 2022 up to financial year end; and
•Assessing the disclosures in the financial statements against the requirements of the accounting standards.
OTHER INFORMATION
The Directors, on behalf of ANZ New Zealand, are responsible for the general disclosures required to be included in ANZ New Zealand’s Disclosure
Statement in accordance with Schedule 2 of the Order (section B1).
Our opinion on the consolidated financial statements does not cover section B1 (referred to as ‘other information’) and we do not express any form of
assurance conclusion thereon.
In connection with our audit of the consolidated financial statements our responsibility is to read the other information and, in doing so, consider
whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the audit or
otherwise appears materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report in this regard.
RESPONSIBILITIES OF DIRECTORS FOR THE CONSOLIDATED FINANCIAL STATEMENTS AND REGISTERED BANK
DISCLOSURES IN SECTION B1, B2, B3, B5 AND B6
The Directors, on behalf of ANZ New Zealand, are responsible for:
•the preparation and fair presentation of the consolidated financial statements in accordance with Clause 25 of the Order, NZ IFRS and
International Financial Reporting Standards;
•the preparation and fair presentation of supplementary information, in accordance with Schedules 2, 4, 7, 11 and 13 of the Order;
•implementing necessary internal control to enable the preparation of consolidated financial statements that are fairly presented and free from
material misstatement, whether due to fraud or error; and
•assessing the ability to continue as a going concern. This includes disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless they either intend to liquidate or to cease operations, or have no realistic alternative but to do so.

INDEPENDENT AUDITOR’S REPORT
93

AUDITOR’S RESPONSIBILITIES FOR THE AUDIT OF THE CONSOLIDATED FINANCIAL STATEMENTS AND
REGISTERED BANK DISCLOSURES IN SECTION B2, B3, B5 AND B6
Our objective is:
•to obtain reasonable assurance about whether the Disclosure Statement, including the consolidated financial statements prepared in
accordance with Clause 25 of the Order, and registered bank disclosures in section B2, B3, B5 and B6, prepared in accordance with Schedules 4,
7, 11 and 13 of the Order as a whole is free from material misstatement, whether due to fraud or error; and
•to issue an independent auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (NZ) will always detect a
material misstatement when it exists.

Misstatements can arise from fraud or error. They are considered material if, individually or in the aggregate, they could reasonably be expected to
influence the economic decisions of users taken on the basis of the consolidated financial statements.

A further description of our responsibilities for the audit of these consolidated financial statements is located at the External Reporting Board (the XRB)
website at:

http://www.xrb.govt.nz/standards-for-assurance-practitioners/auditors-responsibilities/audit-report-1/
This description forms part of our independent auditor’s report.
REVIEW CONCLUSION ON THE REGISTERED BANK DISCLOSURES IN SECTION B4 RELATING TO CREDIT AND
MARKET RISK EXPOSURES AND CAPITAL ADEQUACY (SECTION B4)
Based on our review, nothing has come to our attention that causes us to believe that the registered bank disclosures relating to credit and market
risk exposures and capital adequacy as disclosed in section B4 of the Disclosure Statement, is not, in all material respects disclosed in accordance
with Schedule 9 of the Order.
We have reviewed the registered bank disclosures, as disclosed in section B4 of the Disclosure Statement for the year ended 30 September 2022,
which are required to be disclosed in accordance with Schedule 9 of the Order.
BASIS FOR CONCLUSION ON THE REGISTERED BANK DISCLOSURES IN SECTION B4
A review of the registered bank disclosures in section B4 in accordance with NZ SRE 2410 Review of Financial Statements Performed by the Independent
Auditor of the Entity (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. Our responsibilities under
that standard are further described in the Auditor’s Responsibilities for the Review of the registered bank disclosures in section B4 of our report.
As the auditor of ANZ New Zealand, NZ SRE 2410 requires that we comply with the ethical requirements relevant to the audit of the annual financial
statements.
RESPONSIBILITIES OF DIRECTORS FOR THE REGISTERED BANK DISCLOSURES IN SECTION B4
The Directors, on behalf of ANZ New Zealand, are responsible for the preparation of the registered bank disclosures in section B4, that is required to be
prepared in accordance with Schedule 9 of the Order.
AUDITOR’S RESPONSIBILITIES FOR THE REVIEW OF THE REGISTERED BANK DISCLOSURES IN SECTION B4
Our responsibility is to express a conclusion on the registered bank disclosures in section B4 based on our review. We conducted our review in
accordance with NZ SRE 2410 issued by the New Zealand External Reporting Board. As the auditor of ANZ New Zealand, NZ SRE 2410 requires that we
comply with the ethical requirements relevant to the audit of the annual financial statements, and plan and perform the review to obtain limited
assurance about whether the registered bank disclosures in section B4 is, in all material respects, disclosed in accordance with Schedule 9 of the Order.

A review of the registered bank disclosures in section B4 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 ISAs (NZ). Accordingly we
do not express an audit opinion on the registered bank disclosures in section B4.

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED - ANZ NEW ZEALAND 2022 DISCLOSURE STATEMENT

INDEPENDENT AUDITOR’S REPORT

94
USE OF THIS INDEPENDENT AUDITOR’S REPORT
This independent auditor’s report is made solely to the Directors as a body. Our work has been undertaken so that we might state to the Directors
those matters we are required to state to them in the independent auditor’s 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 Directors as a body for our work, this independent auditor’s report, or any of the
opinions or conclusions we have formed.
The engagement partner on the audit resulting in this independent auditor's report is Jamie Munro.

For and on behalf of

KPMG
Auckland
11 November 2022

T
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ANZ – wholesale debt ANZHAX – interest payment details Application for quotation of securities – ANZ

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