Differentiation

Institutional and Business Services

Salomon Smith Barney Financial Services Conference

Michael Ullmer

4 March 2003

Institutional & Business Services- 2 -

The material that follows is a presentation of general background information about the Bank’s activities current at the date of the presentation, 4 March 2003. It is information given in summary form and does not purport to be complete. It is not intended to be relied upon as advice to investors or potential investors and does not take into account the investment objectives, financial situation or needs of any particular investor. These should be considered, with or without professional advice when deciding if an investment is appropriate.

Disclaimer

Institutional & Business Services- 3 -

Speaker’s Notes

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Institutional & Business Services- 4 -

We have reorganised our business into client and product groups

Institutional Banking

CorporateBanking

BusinessBanking

Global Markets

Working CapitalServices

InstitutionalBanking

Manage Client relationships Design and manufacture product

People Risk Management Technology Brand

Capital and risk management solutions for Institutions and governments in the domestic and international market

Local relationship management for corporate clients in Australia and the top institutional / corporate clients in New Zealand

Integrated financial services for small, medium and rural businesses throughout Australia

Financial markets facing activities including debt capital markets, foreign exchange, derivatives money market, and commodities.

Product range embracing the full capital structure from senior debt to mezzanine to equity using project finance, structured finance, and corporate lending

Products to support financial and operational working capital needs, such as transaction banking, merchant acquiring and asset financing

Institutional & Business Services- 5 -

The elements of our Competitive Advantage are:

Superior understanding of our client’s needs

Excellent understanding of risk & return trade-off

Tailored client relationship management, locally based providing excellent service/effective sales

Integrated product offering with innovative niches

Talented People focused on achieving

flawless execution

Institutional & Business Services- 6 -

Our new client segments better reflect our client base and will facilitate improvement of segment economics

Source: CBA CRIS Quarter March 2002 annualised; Taylor Nelson Sofres July 2002; ABS 2000-2001; Greenwich & Associates 2000; BRW Top 1000 Companies

Client Turnover

($m)

Client Total

Footings($m) Business Model Segment FocusSegment

Small

Institutional

Top TierCorporate

Corporate

Regional

SME

Segmentation criteria

Number Of

Clients

Bu

sin

ess

Co

rpo

rate

>150

10-150 >5

0.85-5

0.85-5

0.15-0.85

<0.15

800

2,200

9,200

4,300

59,000

118,000

RelationshipManaged

RelationshipManaged

ManagedCentrally

•Share of wallet

•New Clients•Share of Wallet

•New Clients•Share of Wallet•Corporate Focus•New Clients•Share of Wallet•Regional Focus

•Share of wallet•Cost

•Cost

Institutional & Business Services- 7 -

Our business models for Corporate and Business Banking involve changes to a number of areas

Sales Service Credit Product

Corporate

SME

Small

Segment

TopTier

Bu

sin

ess

Ba

nki

ng

Co

rpo

rate

Ban

kin

g

Increased client satisfaction through local dedicated Relationship Executives with product support

Relationship served through sales centre and ‘mobile’ salesforce

Streamlined service team aligned with RE and service centre for day-to-day maintenance to speed up simple enquiries

Mostly through service centre with extended hours of support

Streamlined processes for top-ups, property secured and existing relationships to improve client service (instead of mostly full analysis)

Majority of applications ‘fast tracked’ to improve client service (instead of mostly full analysis)

Tailored from standard product to meet more complex client needs

Rationalised from over 100 products to standard packages making choice for the client simple and reducing costs

Lo

cal R

ela

tion

ship

M

an

ag

em

en

tC

en

tra

lise

d R

ela

tion

ship

Ma

na

ge

me

nt

Regional

Institutional & Business Services- 8 -

On the product front, we have an integrated offering with innovative niches...

Institutional

• Environmental initiatives

• Infrastructure financing

• Specialised Lease advisory

Clients

Working Capital Services

• Transaction Banking

Global Markets

• Local presence

• Corporate Bonds

• Precious metals

Other Divisions

• Retail Financial Services

• Premium Financial Services

•Investment and Insurance Services

Institutional & Business Services- 9 -

…while maintaining a sound credit profile

Top 20 exposures as a % of Total Committed Exposure

Dec 2000

Dec 2001

Dec 2002

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

4.0%

Commercial Portfolio

29 27 29

15 15 14

36 39 40

171920

0%

20%

40%

60%

80%

100%

AAA/AA* A BBB Other

Dec 01 Jun 02 Dec 02

Institutional & Business Services- 10 -

Strong execution skills are crucial to client service

BIZ PLANPrioritiesActionsOutcomes

•Developed new strategy•Set key strategic priorities

Strategy

•Key factor for success•Underpinned by people

Execution

Flawless execution of strategy and client service is crucial

Deliver top quartile

performance

Institutional & Business Services- 11 -

In summary, highlights of differentiation are

Delivertop quartile

performance over

rolling five year periods

Superior understanding of our client’s needs

Excellent understanding of risk & return trade-off

Locally based client relationship management

Integrated product offering Fla

wle

ss

Ex

ecu

tio

n

s o l u

t i o

n s

c l i e

n t