Presentation at Auckland Analyst Briefing ASB Bank Sovereign

Presentations Accompanying Analyst Visit to ASB Bank, Auckland 8th December 2003 Disclaimer The material that follows is a presentation of general background information about ASB Group’s activities current at the date of the presentation, December 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 Presentation Overview Overview of ASB Group and ASB Bank  Sovereign  Personal Banking and Contact Centre  Business Banking  Institutional Banking Page Page 15 Page 21 Page 28 Page 33  Overview of Service Ethic in the Support Functions – Insurance Services – ASB Online – Internal Audit Page 39 Page 44 Page 48 ASB Group History of ASB Group       ASB Bank established in 1847 CBA initial investment (75%) in 1989 Sovereign purchase in December 1998 CBA acquisition of Colonial in June 2000 CBA acquired remaining 25% of ASB Group in October 2000 ASB Group Investments formed in 2003 ASB Group Structure Banking ts en Ja cq ue sM ar tin hn ASB Group Support Services e fic f O ol o gy o E fC O nc e Pr op er ty Te c In su ce kD ir ec t n g i re e v So CFS m st ve In AEGIS an n i F Ba n Li fe B S A ASB Bank s e i it r cu e S ASB Bank History of ASB Bank          Started as Auckland Savings Bank in 1847 Real time systems implemented in 1969 Launched NZ’s first ATM in 1981 Launched NZ’s first EFTPOS system in 1984 Launched NZ’s first interactive response system (FASTPHONE) in 1988 Launched vision of ASB Bank being the best bank in NZ through total customer satisfaction in 1991 Representation across NZ established in 1991 Launched NZ’s first internet banking service in 1997 Launched ASB Securities in 1999 Over 10 years, ASB Bank’s Profitability CAGR 20%+ 300 278 Profit (NZ$m) 250 224.7 183.4 200 150.1 150 92.5 100 50 45.5 33.7 37.5 35.4 38.5 107.9 116.9 65.3 71.7 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 Financial Year Over 10 years, ASB Bank Grows 5.5 Times Larger Balance Sheet (NZ$b) 25 20 15 10 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 Financial Year Advances Deposits Motivation  Involve all staff in planning and goal setting  Provide regular feedback and tracking  Incentive program rewarding goaled outcomes  Celebrate success Feedback From Staff  It is great to receive recognition from other     areas Contributes towards positive work environment It makes me proud to be part of the number team Gives us the extra push and drive to be the best We what we best and we genuinely like to help people Breakthrough Service in ASB Online 44 Who We Are  We provide group-wide online support (internet + intranet)  Horizontal not vertical focus  97% of ASB’s regular internet customers are satisfied or very satisfied with ASB Bank’s online banking service – AC Nielsen Consult 1st Half 2003  times top department for breakthrough service performance  Stakeholder Customers  Challenges of IT are many How We Serve  A very clear service vision  Online leadership focus  Our people know how they contribute  Continuous improvement EXECUTE ON OUR SERVICE PROMISE Breakthrough Service Approach  Breakthrough service gives a common framework  Look at the trends not absolutes  We focus on WHAT/HOW not WHO  Recognition WE KNOW WHAT WE LIKE, SO WE DELIVER THAT Breakthrough Service in Group Audit & Risk Management 48 Breakthrough Service Performance: Implementation in Group Audit & Risk Management BANK’S VISION & CULTURE Is to be New Zealand’s best Bank and Financial Services provider, excelling in Customer Service AUDIT & RISK MANAGEMENT’S BREAKTHROUGH SERVICE OBJECTIVE To excel in providing service and value to our clients • Induction Program CHANGING BEHAVIOURS, EVOLVING CULTURE • Service Initiatives • Rewards & Recognition Audit & Risk Management supports Breakthrough Service Performance by ensuring it:  Is aligned with the Bank’s vision  Engages ALL team members  Clearly communicates service standards and  expectations Is regularly and positively reinforced HAVING THE RIGHT “CULTURE CLIMATE” HELPS SUPPORT IMPLEMENTATION OF BREAKTHROUGH SERVICE The Key to Changing Behaviours and Successful Implementation  Making BSP an essential part of the team  induction program Holding regular breakthrough service meetings to agree standards – hold objection clinics, etc –  Rewards and recognition – a key ingredient – hard versus soft R&R ASB Bank Culture Supplementary Information 52 SUCCESS bl Cl pa ea r The S.U.C.C.E.S.S Triangle Ca e Key Attributes  Now a part of “Branch Life”  Understood by all staff  Structured, yet focuses on the client’s needs  Positively impacts on growth, service and profit Motivated ONE TEAM  Encourages interdivisional referrals and communication  Accountability for the process and outcomes  Recognition and reward framework  Published weekly/monthly leader board results Breakthrough Service Delivers end to end service excellence Support Frontline Areas Sales Staff Clients  Identified key service behaviours  Measured through internal customer satisfaction surveys   – All support units measured – Achieving top quartile satisfaction scores Leader boards published Rewards for top performing/most improved teams Presentations Accompanying Analyst Visit to ASB Bank, Auckland 8th December 2003 56