Sun Bank APS 330 Pillar 3 Disclosure at 30 September 2024

Australia and New Zealand Banking Group Limited
9/833 Collins Street Docklands Victoria 3008 Australia
ABN 11 005 357 522
8 November 2024

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

Suncorp Bank APS 330 Pillar 3 Disclosure at 30 September 2024


Australia and New Zealand Banking Group Limited (ANZ) today released Suncorp Bank’s APS 330 Pillar 3 Disclosure
as at 30 September 2024.

It has been approved for distribution by ANZ’s Continuous Disclosure Committee.

Yours faithfully

Simon Pordage
Company Secretary
Australia and New Zealand Banking Group Limited

Suncorp Bank (Norfina Limited ABN 66 010 831 722 AFSL 229882 Australian Credit Licence 229882)
The SUNCORP brand and Sun Logo are used by Suncorp Bank (Norfina Limited) under licence and Suncorp Bank is not part of the Suncorp Group.





BASEL III
PILLAR 3
DISCLOSURE
AS AT 30 SEPTEMBER 2024
APS 330: PUBLIC DISCLOSURE

SUNCORP BANK
(NORFINA LIMITED)
ABN 66 010 831 722

Suncorp Bank Basel III Pillar 3 Disclosure September 2024
2

Basis of Preparation
This document has been prepared by Suncorp Bank to meet the disclosure obligations under the
Australian Prudential Regulation Authority (APRA) Australian Prudential Standard (APS) 330 Public
Disclosure.
Suncorp Bank is represented by Norfina Limited (formerly Suncorp-Metway Limited) and its subsidiaries.
Suncorp Bank is an authorised deposit-taking institution (ADI) and a wholly owned subsidiary of ANZ
Group. It is represented by ANZ Group Holdings Limited (NOHC) and its subsidiaries.
Other than statutory information required by a regulator (including APRA), all financial information is
measured in accordance with Australian Accounting Standards. All figures have been quoted in Australian
dollars and have been rounded to the nearest million.
Figures relate to the quarter ended 30 September 2024 (unless otherwise stated). This document has not
been audited nor reviewed in accordance with Australian Auditing Standards. It should be read in
conjunction with ANZ Group and Suncorp Bank’s consolidated annual and interim financial reports which
have been either audited or reviewed in accordance with Australian Auditing Standards.
This document is prepared in accordance with Basel III Prudential Capital requirements effective for
reporting periods beginning on or after 1 January 2023.
On 31 July 2024, Australia and New Zealand Banking Group Limited (ANZ BGL) announced the
successful completion of the acquisition of 100% of the shares in SBGH Limited, the immediate holding
company of Suncorp Bank (Norfina Limited).

Disclaimer
This report contains general information which is current as at 8 November 2024. It is information given in
summary form and does not purport to be complete.
It is not a recommendation or advice in relation to Suncorp Bank and ANZ Group or any product or service
offered by its entities or intended to be relied upon as advice.
The information in this report is for general information only. To the extent that the information may
constitute forward-looking statements, the information reflects Suncorp Bank's intent, belief or current
expectations with respect to our business and operations, market conditions, results of operations and
financial condition, capital adequacy, specific provisions and risk management practices at the date of this
report and undertakes no obligation to update any forward-looking statements. Such forward-looking
statements are not guarantees of future performance and involve known and unknown risks and
uncertainties, many of which are beyond Suncorp Bank's control, which may cause actual results to differ
materially from those expressed or implied.


Registered office Investor Relations
Level 9, 833 Collins Street Cameron Davis
Docklands, VIC 3008 Executive Manager, Investor Relations
suncorpbank.com.au +61 3 8654 7716
+61 421 613 819

cameron.davis@anz.com

Suncorp Bank Basel III Pillar 3 Disclosure September 2024
3

Table of contents
Basis of Preparation ...................................................................................................................................................... 2
Overview ....................................................................................................................................................................... 4
Loans and advances ..................................................................................................................................................... 5
Impaired assets and 90+ days past due loans .............................................................................................................. 6
Provision for impairment ................................................................................................................................................ 7
Appendix 1 – APS 330 Tables....................................................................................................................................... 8
Appendix 2 - Definitions .............................................................................................................................................. 16

Suncorp Bank Basel III Pillar 3 Disclosure September 2024
4

Overview
Suncorp Bank’s home lending portfolio grew $1.6 billion or 2.8% (11.2% annualised) through the
September quarter. The continued growth was driven by an uptick in applications and an improved
conversion rate, supported by strong service levels, including consistently low turnaround times and
continual improvements in customer and broker experiences. The Bank remains focused on balancing
growth and margins while optimising risk-adjusted returns. The Bank maintains a high-quality and
conservatively positioned home lending portfolio, weighted towards owner occupiers, on principal and
interest repayment terms and loans with a loan-to-valuation ratio (LVR) below 80%.
Business lending contracted $69 million or 0.5% (2.1% annualised). The agribusiness portfolio contracted
$76 million in line with seasonal trends, and due to heightened external refinances. The small and medium
enterprise (SME) portfolio contracted $28 million, reflecting elevated repayment levels which exceeded
new business volumes. This was partly offset by growth in the commercial real estate portfolio of $35
million, predominantly driven by growth in property finance.
The Bank grew household deposits across all portfolios, including retail transaction deposits (15.8%
annualised), retail term deposits (15.6% annualised) and retail savings account balances (12.9%
annualised). Competition remained strong as customers continued to shift toward higher interest products,
albeit at a slower rate compared to pcp. The Bank continues to prioritise portfolio margin in favour of
market share growth and the portfolio is strategically managed within funding requirements.
The total provision for impairment increased by $13 million to $227 million, reflecting an increase to the
collective provision of $15 million, a $1 million recovery in the specific provision, and continued low levels
of write offs.
Gross impaired assets decreased $10 million to $63 million, with decreases across all lending portfolios.
Total 90+ days past due loans increased $4 million to $527 million or 74 basis points of GLA, down 1 basis
point of GLA from the previous quarter.
The Liquidity Coverage Ratio (LCR) was maintained at an elevated level above the target operating range,
averaging 145% over the quarter, 10% below the June quarterly average, reflecting the decrease in excess
liquidity following the successful acquisition of Suncorp Bank by ANZ. The Net Stable Funding Ratio
(NSFR) ended the period at 124%, demonstrating the continued strength of the Bank’s funding and liquidity
position. The Bank’s capital levels remain sound, with a Common Equity Tier 1 ratio of 10.01% (Jun 2024:
10.33%), within the target operating range of 10.00% to 10.50%.

Suncorp Bank Basel III Pillar 3 Disclosure September 2024
5

Loans and advances

Sep-24Sep-24
Sep-24Jun-24Sep-23 vs Jun-24 vs Sep-23
$M$M$M%%
Hous ing loans - term
52,02150,11748,5423.87.2
Hous ing line of credit
359401473(10.5)(24.1)
Securitis ed hous ing loans and covered bonds
6,2446,4945,722(3.8)9.1
Total housing loans
58,624
57,01254,737
2.87.1
Pers onal loans
171930(10.5)(43.3)
Retail loans
58,641
57,03154,767
2.87.1
SME
2,6422,6702,644(1.0)(0.1)
Com m ercial
5,4665,4315,3770.61.7
Agribus ines s
4,7214,7974,356(1.6)8.4
Total business loans
12,829
12,89812,377
(0.5)3.7
Total lending
71,470
69,92967,144
2.26.4
Provis ion for im pairm ent
(227)(214)(212)6.17.1
Total loans and advances
71,243
69,71566,932
2.26.4
Geographical breakdown - Total lending
Queens land
31,70131,17130,2831.74.7
New South Wales
21,16820,50019,3163.39.6
Victoria
10,36610,1689,9131.94.6
Wes tern Aus tralia
4,5924,5124,3291.86.1
South Aus tralia and other
3,6433,5783,3031.810.3
Outside of Queensland loans
39,76938,75836,8612.67.9
Total lending
71,470
69,92967,144
2.26.4

Suncorp Bank Basel III Pillar 3 Disclosure September 2024
6


Impaired assets and 90+ days past due loans

(1)
Gross non-performing loans in the above table excludes loans that meet additional requirements under the revised APS 220 Credit Risk Management.
(2)
Net of increases in previously recognised impaired assets and impaired assets written off.

Sep-24Sep-24
Sep-24Jun-24Sep-23 vs Jun-24 vs Sep-23
$M$M$M%%
Gross balances of individually impaired loans
Retail lending27 30 27 (10.0) -
Agribus ines s lending11 14 15 (21.4) (26.7)
Com m ercial lending22 24 27 (8.3) (18.5)
SME lending3 5 7 (40.0) (57.1)
Gross impaired assets63 73 76 (13.7) (17.1)
Im pairm ent provis ion(13) (15) (24)(13.3) (45.8)
Net impaired assets50 58 52 (13.8) (3.8)
Impairment provisions expressed as a percentage of
gross impaired assets
21%21%32%
90+ days past due loans not shown as impaired assets527 523 380 0.8 38.7
Gross non-performing loans
(1)
590 596 456 (1.0) 29.4
Analysis of movements in gross individually impaired
assets
Balance at the beginning of the period73 68 101 7.9 (27.7)
Recognition of new im paired as s ets 2 23 2 (91.3) -
Other m ovem ents in im paired as s ets
(2)
- (4) (3)(100.0) (100.0)
Im paired as s ets which have been reclas s ed as
perform ing as s ets or repaid
(12) (14) (24)(14.3) (50.0)
Balance at the end of the period63 73 76 (13.7) (17.1)
Quarter Ended

Suncorp Bank Basel III Pillar 3 Disclosure September 2024
7

Provision for impairment


Sep-24Sep-24
Sep-24Jun-24Sep-23 vs Jun-24 vs Sep-23
$M$M$M%%
Collective provision
Balance at the beginning of the period2001901905.35.3
Charge agains t im pairm ent los s es1510-50.0n/a
Balance at the end of the period2152001907.513.2
Specific provision
Balance at the beginning of the period141929(26.3)(51.7)
(Releas e)/charge agains t im pairm ent los s es(1)1(3)(200.0)(66.7)
Im pairm ent provis ion written off
(1)
(1)(6)(4)(83.3)(75.0)
Balance at the end of the period121422(14.3)(45.5)
Total provision for impairment - Banking activities 2272142126.17.1
(1)
Includes unwind of dis count.
Provision for impairment expressed as a percentage of gross
loans and advances are as follows:
%%%
Collective provis ion0.30 0.29 0.28
Specific provis ion0.02 0.02 0.03
Total provision
0.32 0.31 0.31
Quarter Ended

Suncorp Bank Basel III Pillar 3 Disclosure September 2024
8

Appendix 1 – APS 330 Tables
 Table 1: Capital disclosure template – not applicable for this reporting period. This table was
disclosed in the June 2024 reporting period.
 Table 2: Main features of capital instruments
 Table 3: Capital adequacy
 Table 4: Credit risk
 Table 5: Securitisation exposures
 Table 20: Liquidity Coverage Ratio Disclosure

Table 2: Main Features of Capital Instruments
Attachment B of Prudential Standard APS 330 details the continuous disclosure requirements for the main
features of all capital instruments included in Suncorp Bank’s regulatory capital.
The Suncorp Bank’s main features of capital instruments are updated on an ongoing basis and are
available at https://www.suncorpbank.com.au/about-us/investors/regulatory-disclosures-current.html.

Suncorp Bank Basel III Pillar 3 Disclosure September 2024
9


Table 3: Capital Adequacy



Sep-24Jun-24
$M$M
On-balance sheet credit risk-weighted assets
Claim s s ecured by res idential m ortgage19,10618,689
Other retail7981
Bank8046
Governm ent--
Corporates
(1)
8,6418,847
Securis ation613
All other expos ures242163
Total on-balance sheet assets28,15427,839
Off-balance sheet exposures
Non-m arket related off-balance s heet expos ures2,4262,474
Market related off-balance s heet expos ures5174
Securitis ation 813
Total off-balance sheet exposures2,4852,561
Total on-balance sheet assets and off-balance sheet positions30,63930,400
Market risk capital charge95158
Operational risk capital charge2,6882,688
Total risk-weighted assets33,42233,246
Sep-24Jun-24
%%
Com m on Equity Tier 1 10.0110.33
Tier 111.6812.01
Tier 22.532.50
Total risk-weighted capital ratio 14.2114.51
Capital Ratios
Risk Weighted Assets
(1)
Includes co mm ercial pro pert y and land acquisitio n, develo pment, and c o nstructio n expo sures.

Suncorp Bank Basel III Pillar 3 Disclosure September 2024
10

Table 4: Credit Risk
Table 4A: Credit risk by gross credit exposure





Notes:
(1)
Gross credit exposures and Average gross credit exposures reflect on balance sheet exposures and credit equivalent amounts for off balance sheet
exposures.
(2)
Receivables due from other Banks include collateral deposits provided to derivative counterparties.
(3)
Off-balance sheet exposures represent the credit equivalent amount in accordance with APS 112 Capital Adequacy: Standardised Approach to Credit
Risk.
(4)
Total credit risk excludes cash at bank and other money market placements.
(5)
Securitisation exposures for September 2024 include $2,922 million in Loans and advances, $29 million in Investment Securities, $28 million in
Derivatives and $335 million in Off-balance sheet exposures. The securitisation exposures for Loans and advances qualify for regulatory capital relief
under APS 120 Securitisation and therefore do not contribute to the Bank’s total gross credit risk. The remaining securitisation exposures carry credit
risk commensurate with their respective asset classes in accordance with APS 120 Securitisation.
(6)
Includes commercial property and land acquisition, development, and construction exposures.



Sep-24 Jun-24 Sep-24 Jun-24
$M$M$M$M
Revers e repurchas e agreem ents 1,3001,6311,4661,627
Receivables due from other Banks
(2)
909739824777
Trading Securities 1,8432,1541,9992,573
Derivatives
(3)
63957990
Inves tm ent Securities 9,7689,7849,7769,967
Loans and Advances 68,10166,77667,43967,028
Off-balance s heet expos ures
(3)
5,9615,8065,8835,703
Total gross credit risk
(4)
87,94586,98587,46687,765
Securitis ation expos ures
(5)
3,3143,6023,4583,051
Total including securitisation exposures 91,25990,58790,92490,816
Im pairm ent provis ion(227)(214)(221)(212)
Total91,03290,37390,70390,604
Gross Credit Exposure
(1)
Exposure Type
Average Gross Credit Exposure
(1)
Sep-24 Jun-24 Sep-24 Jun-24
$M$M$M$M
Claim s s ecured by res idential m ortgage 60,96559,45660,21159,762
Other retail as s ets 959897101
Bank 1,5141,7631,6391,788
Governm ent 12,18412,53012,35713,137
Corporates
(6)
12,97612,99612,98612,840
All other expos ures211142176137
Total gross credit risk
(4)
87,94586,98587,46687,765
Securitis ation expos ures
(5)
3,3143,6023,4583,051
Total including securitisation exposures 91,25990,58790,92490,816
Im pairm ent provis ion(227)(214)(221)(212)
Total91,03290,37390,70390,604
Portfolios Subject to the Standardised Approach
Gross Credit Exposure
(1)
Average Gross Credit Exposure
(1)

Suncorp Bank Basel III Pillar 3 Disclosure September 2024
11

Table 4: Credit Risk (Continued)
Table 4B: Credit risk by portfolio

(1)
The specific provisions of $12 million represents the specific provisions for accounting purposes. It excludes the ineligible collective provisions of $46
million which in accordance with APS 220 Credit Risk Management are regulatory specific provisions. The regulatory specific provisions under APS
220 Credit Risk Management are $58 million.
(2)
Includes commercial property and land acquisition, development, and construction exposures.



(1)
The specific provisions of $14 million represents the specific provisions for accounting purposes. It excludes the ineligible collective provisions of $46
million which in accordance with APS 220 Credit Risk Management are regulatory specific provisions. The regulatory specific provisions under APS
220 Credit Risk Management are $60 million.
(2)
Includes commercial property and land acquisition, development, and construction exposures.





Non-performing
loans
Specific
Provisions
(1)
Charges/(Releases)
for Specific
Provisions &
Write Offs
Sep-24Sep-24Sep-24
$M$M$M
Claim s s ecured by res idential m ortgage 6225-
Other retail as s ets 411
Bank ---
Governm ent ---
Corporates
(2)
1576(1)
All other expos ures---
Total gross credit risk78312-
Securitis ation expos ures 22-
Total including securitisation exposures 80512
Im pairm ent provis ion (11)-
Total79412
Portfolios Subject to the Standardised Approach
Non-performing
loans
Specific
Provisions
(1)
Charges/(Releases)
for Specific
Provisions &
Write Offs
Jun-24Jun-24 Jun-24
$M$M$M
Claim s s ecured by res idential m ortgage 65851
Other retail as s ets 511
Bank ---
Governm ent ---
Corporates
(2)
1748(1)
All other expos ures---
Total gross credit risk837141
Securitis ation expos ures 26-
Total including securitisation exposures 86314
Im pairm ent provis ion(12) -
Total85114
Portfolios Subject to the Standardised Approach

Suncorp Bank Basel III Pillar 3 Disclosure September 2024
12

Table 4: Credit Risk (Continued)
Table 4C: Provisions eligible for inclusion in Tier 2 capital
(1)


(1)
Provisions held against performing exposures that represent a purely forward-looking amount for future losses that are presently unidentified.
(2)
Ineligible collective provisions represent the collective provision for impairment on Stage 3 ECL loans and advances and Stage 2 ECL loans and
advances with any level of arrears. Ineligible collective provision is considered a specific provision for regulatory purposes under APS 220 Credit Risk
Management.
(3)
Following removal of the ERCL (equity reserve for credit losses) requirement in APS 220 Credit Risk Management from 1 January 2022, the general
equity reserve has been established in its place. The general equity reserve will be maintained at this level ($76 million) pending further consideration
of its future treatment.


Sep-24Jun-24
$M$M
Collective provis ion for im pairm ent215200
Ineligible collective provis ions
(2)
(46)(46)
Eligible collective provis ions169154
General equity res erve
(3)
7676
245230Provisions eligible for inclusion in Tier 2 capital (Standardised approach)

Suncorp Bank Basel III Pillar 3 Disclosure September 2024
13

Table 5: Securitisation Exposures
Table 5A: Summary of securitisation activity for the period
There was no new securitisation activity undertaken during the quarter ending 30 September 2024 (quarter
ending 30 June 2024: $1,250M).



Table 5B(i): Aggregate of on-balance sheet securitisation exposures by exposure type



Table 5B(ii): Aggregate of off-balance sheet securitisation exposures by exposure type







Sep-24Jun-24Sep-24Jun-24
$M$M$M$M
Res idential m ortgages-1,250--
Total exposures securitised during the period-1,250--
Exposures
Securitised
Recognised Gain or
(Loss) on Sale
Sep-24Jun-24
Exposure type$M$M
2965
2965Total on-balance sheet securitisation exposures
Debt s ecurities
Sep-24Jun-24
Exposure type$M$M
1819
2847
Total off-balance sheet securitisation exposures4666
Liquidity facilities
Derivative expos ures

Suncorp Bank Basel III Pillar 3 Disclosure


September 2024


14
Table 20: Liquidity Coverage Ratio Disclosure



Sep-24
Sep-24
Jun-24
Jun-24
Mar-24
Mar-24
$M
$M
$M
$M
$M
$M
Liquid assets, of which:
High-quality liquid assets (
HQLA
)
13,037
13,874
13,964

Alternative liquid assets (
ALA
)
-
-
-

Cash outflows
Retail deposits and deposits from small business cu
stomers, of which:
36,632
3,621

36,140
3,579
36,005

3,565
stable deposits
23,216


1,161


22,919


1,146


22,807


1,140


less stable deposits
13,416


2,460


13,221


2,433


13,198


2,425


Unsecured wholesale funding, of which:
4,796


3,132


5,132


3,298


5,148


3,291


operational deposits (all counterparties) and depos
its in network s for cooperative bank s
-
-
-

-
-

-
non-operational deposits (all counterparties)
3,605


1,941


3,635


1,801


3,712


1,855


unsecured debt
1,191


1,191


1,497


1,497


1,436


1,436


Secured wholesale funding
93


450


208


Additional requirements, of which:
9,577


1,288


9,815


1,607


9,467


1,280


outflows related to derivatives exposures and other
collateral requirements
841


841


1,164


1,164


836


836


outflows related to loss of funding on debt product
s
-


-


-


-


-


-


credit and liquidity facilities
8,736


447


8,651


443


8,631


444


Other contractual funding obligations
1,372


1,064


1,107


797


1,117


818


Other contingent funding obligations
8,689


833


8,251


706


7,675


695


Total cash outflows
10,031


10,437


9,857


Cash inflows
Secured lending (e.g. reverse repos)
768


-


754


-


1,448


-


Inflows from fully performing exposures
650


341


675


364


651


352


Other cash inflows
692


692


1,118


1,118


673


673


Total cash inflows
2,110


1,033


2,547


1,482


2,772


1,025


Total liquid assets
13,037
13,874

13,964
Total net cash outflows
8,998
8,955

8,832
Liquidity Coverage Ratio (%)
145
15
5
158
Number of data points used
66
63
62

Total adjusted
value
Total adjusted
value
Total adjusted
value
Total
unweighted
value
(average)
Total
weighted
value
(average)
Total
unweighted
value
(average)
Total
weighted
value
(average)
Total
unweighted
value
(average)
Total
weighted
value
(average)

Suncorp Bank Basel III Pillar 3 Disclosure September 2024

15

Overview
The Liquidity Coverage Ratio (LCR) promotes shorter-term resilience by requiring ADIs to maintain
sufficient qualifying High Quality Liquid Assets (HQLA) to meet expected net cash outflows (NCO) under
an APRA prescribed 30 calendar day stress scenario. Suncorp Bank manages its LCR on a daily basis and
maintains a buffer over the regulatory minimum of 100%.
Liquidity and Funding Risk Management Framework
The Suncorp Bank (Norfina Limited) Board is responsible for the sound and prudent management of
liquidity risk across the Bank, with authority delegated to the Suncorp Bank Board Risk Committee.
Executive management of liquidity and funding risk is overseen through the Suncorp Bank Asset and
Liability Committee (SBALCO) which reviews risk measures and limits, endorses and monitors funding and
liquidity strategies and ensures stress tests, the Contingency Funding Plan and holdings of high-quality
liquid assets are effective and appropriate. Operational management of liquidity risk is delegated to a
centralised function in the Bank Treasury division.
Liquidity and Funding Management
The quantum of liquid assets held considers the amount needed to meet prudential and internal
requirements (including a variety of internal stress scenarios as part of the risk management framework)
and suitable buffers as appropriate.
Liquid assets included in the LCR consist of HQLA (such as cash, Australian Semi-Government and
Commonwealth Government securities).
Other contractual funding obligations and other net inflows represent gross flows not included elsewhere in
the LCR. Over time, key balances in these categories can be material to the Bank’s net cash outflow.
During the quarter, the material balances of net other cashflows were due to forecast loan disbursements,
regulatory liquidity held against the NCD portfolio as well as settlement periods for liquid assets and
funding transactions (such as the $1.4bn Senior Unsecured transaction).
Contingency Funding Plan
Suncorp Bank maintains a Contingency Funding Plan (CFP) which outlines funding and management
strategies to address liquidity shortfalls under stressed conditions. The CFP establishes clear lines of
responsibility and provides a comprehensive list of liquidity options to enable swift, decisive action to
support the mitigation of any potential liquidity risks.
Suncorp Bank also monitors several Early Warning Indicators that serve as metrics complementary to its
other liquidity risk limits, to identify the emergence of increased risk or vulnerabilities and support in the
decision-making around any activation of the CFP.
Liquidity Coverage Ratio
Suncorp Bank calculates its LCR position on a daily basis, ensuring a buffer is maintained over the
regulatory requirement of 100% and the Board’s risk appetite. The Liquidity Coverage Ratio (LCR) was
maintained at an elevated level above the target operating range ahead of completion of the sale to ANZ,
averaging 145% over the quarter. Excess liquidity levels normalised following the successful acquisition of
Suncorp Bank by ANZ, with the quarterly average 10% below the June quarterly average.
There was approximately $900m in domestic term maturities across the September quarter. These were
replaced by a $1.4bn Senior Unsecured transaction in late September with the issue of a 3 and 5-year
floating rate note. On average, unsecured debt exposure was lower through the quarter driven by a
reduction in US Commercial Paper in the LCR 30-day window. The Bank saw an increase in outflows
related to derivatives exposures towards the end of the quarter as a number of offshore maturities entered
the NCO.
No term maturities were present in the NCO window at quarter end, contributing to an LCR of 137% on
30th September 2024. During the quarter the lowest point of the LCR was 133% on 17th September with
liquidity being reduced prior to the pricing of the $1.4bn Senior Unsecured transaction.

Suncorp Bank Basel III Pillar 3 Disclosure September 2024

16

Appendix 2 - Definitions
AASB 9 AASB 9 Financial Instruments was issued in December 2014. It addresses recognition and
measurement requirements for financial assets and financial liabilities, impairment requirements that
introduce a forward-looking expected credit loss impairment model, and general hedge accounting
requirements which more closely align with risk management activities undertaken when hedging
financial and non-
financial risks. This standard became mandatory for the annual reporting period from
1 July 2018.
Capital adequacy ratio Capital base divided by total assessed risk, as defined by APRA.
Collective provision A collective provision is established to determine expected credit losses (see also Expected Credit
Losses definition below) for loan exposures which are not specifically provisioned and can be in the
performing or non-performing portfolios. For business banking exposures, a ratings-based approach is
applied using estimates of probability of default and loss given default, at a customer level. For
portfolio managed exposures, the portfolios are split into pools with homogenous risk profiles and pool
estimates of probability of default and loss given default are used to calculate the collective provision.
Common Equity Tier 1 (CET1) Common Equity Tier 1 capital comprises accounting equity plus adjustments for intangible assets and
regulatory reserves.
Common Equity Tier 1 ratio Common Equity Tier 1 divided by total risk weighted assets, as defined by APRA.
Credit value adjustment (CVA) A capital charge that covers the risk of mark-to-market losses on the counterparty credit risk.
Eligible collective provisions Primarily represents the collective provision for impairment on loans and advances in Stage 1
(performing and/or newly originated assets). Provisions for loans and advances in Stage 1 are
established to provide for expected credit losses (ECL) for a period of 12 months. Forward-looking
provisions for future, presently unidentified losses are also included within the Eligible collective
provision balance.
Expected credit losses (ECL) Expected credit losses (ECL) are calculated as the probability of default (PD) x loss given default
(LGD) x exposure at default. The credit models are calibrated to reflect PD and LGD estimates based
on historical observed experience, as well as reflecting unbiased forward-looking views of
macroeconomic conditions, through macroeconomic variables that influence credit losses, for example
unemployment rates and changes in house prices.
Ineligible collective provisions Represents the collective provision for impairment on loans and advances in Stage 2 or Stage 3. Stage
2 assets include assets that have experienced a significant increase in credit risk (SICR) since
origination (under-performing loans). Stage 3 assets within ineligible collective provisions include ‘past
due but not impaired’ and ‘impaired assets’ (non-performing loans, other than those for which a
specific provision is held under AASB 9). Collective provisions for loans and advances in Stage 2 and
Stage 3 are established to provide for ECL for the remaining term of the loans and advances (lifetime
ECL). Ineligible collective provision is considered as specific provision for regulatory purposes under
APS 220 Credit Risk Management.
Liquidity coverage ratio (LCR) An APRA requirement to maintain a sufficient level of qualifying high-quality liquid assets to meet
liquidity needs under an APRA-defined significant stress event lasting for 30 calendar days. Absent of
a situation of financial stress, the LCR must not be less than 100%. The LCR is calculated as the ratio
of qualifying high-quality liquid assets relative to net cash outflows in a modelled APRA-defined 30-
day
stress scenario.
Loan-to-value ratio (LVR) Ratio of a loan to the value of the asset purchased.
Non-performing exposure An exposure that is in default. A default is considered to have occurred with regard to a particular
borrower when either, or both, of the events in sub-paragraphs (i) or (ii) have taken place: (i) the ADI
considers that the borrower is unlikely to pay its credit obligations to the ADI in full, without recourse by
the ADI to actions such as realising available security;
(ii) the borrower is 90 days or more past-due on a credit obligation to the ADI or, in the case of
subsidiaries in jurisdictions where a different number of days past-due is set for exposures to
individuals (i.e. natural persons) or public sector entities by the national regulator, the borrower is past-
due by the number of days (or more) specified by that national regulator.
Past due loans An exposure for which any amount due under a contract (interest, principal, fee or other amount) has
not been paid in full at the date when it was due. An exposure is considered past-due from the first day
of missed payment.
Risk weighted assets Total of the carrying value of each asset class multiplied by their assigned risk weighting, as defined by
APRA.
Specific provision
A specific provision for impairment is recognised where there is objective evidence of impairment and
full recovery of principal and interest is considered doubtful. The present value of the expected future
cash flows is compared to the carrying amount of the loan to determine the specific provision required.
Total assessed risk Credit risk-weighted assets, off-balance sheet positions, market risk capital charge and operational risk
charge, as defined by APRA.