New Zealand - a message from Graham Hodges

Four years after completing the acquisition of The National Bank in New Zealand, we have achieved a great deal. The integration of the two banks is now well behind us, we have clearly defined our key retail banking customer propositions and all the businesses are performing well.

Now we are investing to grow our businesses for the medium term. We launched mobile phone banking, and are investing in our call centre, internet banking and telling platforms. We are also focused on growing where we are underweight in our market share (consumer finance and private banking) and developing new products and services in our traditional heartlands of Rural, Corporate and Institutional banking.

Our strategy is yielding good results. Profit was up 6% on 2006 with stable or growing market share in most segments of the business and customer satisfaction maintained at very high levels. As well the number of bank customers who either use or would consider using either of our two main brands (our total customer reach) has risen from 53% to 55% over the past year (ACNielsen Consumer Finance Monitor).

ANZ National Bank was the 2007 INFINZ Bank of the Year, and retained its position as the Business Finance Monitor's² Number One Bank for rural agri-business customers.

While there are some uncertainties in the New Zealand economy, overall the banking environment there remains conducive to reasonable earnings growth.