ANZ Group Stock

Thank you for standing by, and welcome to the ANZ 3Q '26 Trading Update. [Operator Instructions] I would now like to hand the conference over to Kylie Bundrock, GGM, Investor Relations and M&A. Please go ahead.

Thank you, Harmony, and good morning, everyone, and thank you for joining ANZ's Third Quarter 2026 update. I'm Kylie Bundrock, ANZ's Group General Manager. On behalf of the ANZ team, I would like to acknowledge the traditional custodians of the land on which we lead this meeting today, the Wurundjeri people, and recognize their continuing connection to land, waters and community. I pay my respects to elders past and present and to the Aboriginal and Torres Strait Islander peoples joining us today. Our CFO, Farhan Faruqui, is having a call this quarter to give you some additional context and provide you with an opportunity to ask questions. We will limit it to one question per person in the interest of time. I'll now hand over to Farhan.

Thank you, Kylie, and good morning, everyone, and thank you for joining. Our third quarter performance reflects momentum building across our businesses and continued execution against our 5 immediate priorities. Our new leadership team is driving our cultural reset. We are continuing to progress the integration of Suncorp Bank and delivery of the ANZ single customer front end and are on track to meet our completion time lines. Our work to reduce duplication and simplify the bank is on track, and we remain focused on improving nonfinancial risk management and are on track to deliver the activities in our root cause remediation plan.

With that, in the quarter, our cash profit increased 1% on the quarterly average of the first half 2026. The quarter 3 return on tangible equity of 11.54% and cost-to-income ratio of 49.66% continue to track to our ANZ 2030 targets. The quarter was impacted by an expense provision of NZD 125 million relating to a high court ruling in New Zealand. We had flagged this in May and have since appealed the decision. Excluding this impact, cash profit increased 5% versus the first half quarterly average. FX translation continued to impact this quarter, but at a profit before provision level, the net FX impact was largely neutralized by our FX hedging strategy.

My comments this morning on the quarter will be on a constant currency basis to better reflect underlying performance versus the first half quarterly average. During the quarter, revenue increased 1% with net interest income ex Markets up 3%, reflecting growth in business volume and an increase in net interest margin. This more than offset reductions in Markets income and other operating income. Business and Private Bank and Australia Retail both delivered strong net interest income outcomes with higher net interest margins and volumes. Net interest income in New Zealand division and Institutional ex Markets were both down slightly, reflecting a disciplined approach to growth in competitive pricing environments.

Markets delivered another quarter of income above $500 million. The reduction versus first half quarterly average was driven primarily by reduced client activity in commodities. Other operating income, excluding Markets, was down, driven by timing, seasonality and pricing-related impacts. This quarter-on-quarter variability is not unusual. However, compared to the third quarter last year, other operating income ex Markets increased 2%. Group NIM increased 1 basis point in the quarter. But notably, NIM ex Markets increased 4 basis points. Key factors driving the increase in Group NIM included higher replicating portfolio earnings and improved deposit margins in a higher interest rate environment.

At the first half results, we had indicated a 7 basis points tailwind in our replicating portfolio over the next 12 to 18 months. We realized 4 basis points in this quarter, and we expect our replicating portfolio to continue to be a tailwind over the next 12 months or so. Now, these benefits were partially offset by competition impacting asset margins and asset and funding mix. We expect some of these headwinds to continue in the fourth quarter. On the balance sheet, customer deposits increased 2% with growth in Business and Private Bank, New Zealand and Institutional. Deposits were stable in Australia Retail with June seasonality. Lending increased 3%. Business and Private Bank delivered strong loan growth of 4% with June marking a record month.

Institutional lending ex Markets grew 2% in the quarter, and Australia Retail lending also grew 2% with Housing lending returning to system growth in the quarter. Now, there has been a lot of recent market commentary around home lending. In that context, ANZ's mortgage application value in the third quarter was flat quarter-on-quarter, supported by our participation in the First Home Buyers Guarantee Scheme from late March. Excluding the impact of the scheme, application value declined 5% quarter-on-quarter and 12% since the changes in May. While system credit growth is moderating, we continue to expect to grow at or around system in second half '26 as previously signaled.

Having said this, I want to be clear, our ANZ 2030 strategy is not over-indexed on mortgages. While mortgages remain an important relationship product, ANZ 2030 is focused on growing everyday banking to deepen customer relationships, supported by ANZ's distinctive and well-diversified portfolio. On expenses, as noted, the New Zealand provision impacted expenses this quarter. Excluding the New Zealand provision, third quarter expenses were down 1%, demonstrating continued progress against our productivity agenda and keeping us on track to deliver $875 million in gross cost savings in FY '26.

At the first half results, we provided FY '26 expense guidance of approximately 5% lower than our full year '25 cost base of $11.85 billion, excluding significant items. We are maintaining this guidance while absorbing both the New Zealand provision and the impact of full ownership of our merchant acquiring business. Now, turning to credit quality. On an annualized basis, our CIC charge for the quarter was 5 basis points. This included an IP charge of 3 basis points, reflecting the continued strength of our portfolio. A 2 basis points collective provision charge of $37 million increased our collective provision balance to $4.48 billion, approximately $2 billion above our base case ECL scenario and providing a collective provision coverage ratio of 1.2%.

Greater than 90 days past due housing loan exposures increased slightly in both Australia and New Zealand, but remained below levels seen this time last year. Group nonperforming exposures remained stable at 55 basis points of total committed exposure, and Group watch and control list exposures reduced over the quarter, while industry sector composition in that portfolio remained broadly stable. Overall, portfolio performance remains in line with the experience of the past 5 years, and we continue to be well provided. But we remain in an uncertain environment and continue to closely monitor geopolitical and macroeconomic conditions, particularly their impact on our domestic markets of Australia and New Zealand.

Turning to capital, our Level 2 CET1 ratio increased 12 basis points to 12.51%. 40 basis points of capital was generated from cash profit, partially offset primarily by 3 items: growth in underlying credit RWA, data and methodology changes and IRRBB RWA, predominantly due to additional hedging of the replicating portfolio. Capital flow adjustment provided a small benefit in the quarter. We maintain a resilient balance sheet with a strong capital, funding and liquidity position. To conclude, the momentum we have built in the first half continues to strengthen. We are becoming a simpler, more efficient organization with disciplined execution. And we are investing in our segment propositions, channels, customer experience and transaction banking in line with our ANZ 2030 strategy. I'll now turn to your questions.

[Operator Instructions] Your first question comes from Ed Henning from CLSA.

Just on the New Zealand cost of the class action, you said you've absorbed it in guidance this year. Have you stopped any spend this year that it will then kind of go forward that you'll need to spend next year? Or should we think about the second half number of costs that's where it's going to grow for next year and you haven't held anything back to hit your guidance this year for that 5%?

No. Thanks, Ed, for that question. No, we haven't held back anything. One of the reasons why we were able to absorb that cost is because we've had some additional FX benefits in our expenses, which partially offset the NZD 125 million impact from the class action. There's also continued cost control that is helping us just in terms of managing our costs well and managing third-party spend, managing any uplift. So we haven't actually stopped doing anything. We are simply managing within our current envelope and ensuring that we absorb this cost.

Your next question comes from Tom Strong from Citi.

I just had a question on the balances at Suncorp. I mean they were down 1% in the quarter despite that channel has been quite price competitive. Can you just talk to what you're seeing behaviorally in terms of your Suncorp customers as we approach the migration over the next 12 months?

Thank you for that, Tom. Look, I don't -- there's nothing particularly to call out from the Suncorp Bank perspective. Obviously, Suncorp Bank is being thoughtful around managing volume and returns in terms of the home loan portfolio. We haven't seen any customer attrition of note that we should call out. And of course, there's been a slight reduction in deposits over the quarter, but that's largely been on the back of treasury term deposits being repaid and being replaced by cheaper wholesale funding, but not particularly any underlying client activity that led to that. So we feel pretty comfortable with where we are right now. Of course, we continue to monitor that as we get closer to year end.

Your next question comes from Andrew Triggs from JPMorgan.

Just a question on the underlying NIM. So just to clarify that it doesn't include any liquids tailwind in that plus 4? And also just related to the underlying NIM, deposit growth really just came from Markets, the Markets franchise in the period. Australian Retail deposits were flat quarter-on-quarter. Can you just talk to that, whether that's, I guess, a sustainable strategy in the longer term? And when would you expect to sort of pick up your growth within the Australian Retail and business deposit framework?

So I just want to clarify. The Australia retail third quarter flatness in deposits is actually reasonably seasonal. And typically, what we see is that Australian household deposits remain reasonably stable to slightly down, and there's a shift towards Business and Private Bank deposits, which did see growth in the quarter. If you look at Institutional, the Institutional ex Markets deposits sort of decreased on an end-of-period basis on a quarter-on-quarter. But from an average perspective, they continue to grow. Average operational volumes were up quarter-on-quarter by about 1% and over the quarter are up 8% versus the first half average and above -- and about 13% versus the prior comparable quarterly average.

So the deposit trends are actually pretty positive. The average deposit trends in Institutional ex Markets are positive. End of period, there were some deposit movements that influenced the outcome. But overall, we feel pretty good in terms of the direction of our PCM business in Institutional. And markets really didn't have a NIM drag, so to speak, because the Markets denominator, the underlying volumes grew pretty much in line with the rest of the Group. It's just that the Markets income was much more reflected in other operating income versus NII. So overall, that had a bit of a drag, but not because of market volumes. Liquids, to your point, had no impact in this quarter.

Your next question comes from Jonathan Mott from Barrenjoey.

I just wanted to clarify one of the comments I think you made. You said that at the half, you thought the replicating portfolio was going to give you about 7 basis points tailwind. And I think you mentioned about 4 of that was achieved. Just clarifying that was correct. I got that right. Does that also imply there's only 3 basis points left to go and effectively, most of the benefit of the replicating portfolio to the NIM is already embedded in the number?

Yes. So look, I think -- so you're right in general, Jon. I think the replicating portfolio did deliver the 4 basis points of the 7 basis points we had called out. The reason, of course, for that is just the fact that we had a concentration of low rate hedges effectively rolling off in this particular quarter. And therefore, by getting invested at a higher rate, they delivered a higher NIM outcome. That impact will moderate or -- and the remaining 3 basis points or thereabouts will be delivered more progressively over the course of the next 12 months. So we still believe that there's an underlying tailwind in replicating, but not to the extent that we've seen certainly in this quarter and what we've seen over the last 12 to 18 months.

Your next question comes from Brian Johnson from MST.

Fahan, just if we have a look at it, we're sitting mid-August. We can see that you're growing at system probably a little bit above if your applications are down 12%. I'm just wondering, growing back at housing system in a market environment where we see crazy competition with the replicating portfolio to fade, is this suggesting that the NIM actually falls from this point? That it's already...

Brian, thanks for that question. Look, I think -- so the fourth quarter housing drawdowns are largely locked in because they were originated sort of in the third quarter. So they're not being impacted. Now we have also seen rising competition, to be fair, to your point, on mortgage lending over the last couple of months. So yes, there would be some impact that will flow through, but it's not -- but we think we have offsetting tailwinds as well. So we'll have to see ultimately where it lands. But overall, as I had said in the first half guidance, our second half NIM has a bias to the upside, and we continue to maintain that position.

So can I just go back on that, Farhan. But in the month of July, is that core NIM, because you've got the data now, is it up or down now that you're growing back at system housing?

So core NIM is -- well, it depends on which segment. In certain segments, it's sort of flat and stable. And in Housing, I would argue that it is down a little bit. But as I said, we also have the compensating tailwinds on the deposits. So hard to give you a sense of where we will land, particularly in the fourth quarter. But overall, we still expect second half to be supportive to margin.

Your next question comes from Richard Wiles from Morgan Stanley.

Could you please comment on the key considerations when thinking about the competitive environment and the outlook for margins in your New Zealand and Institutional businesses, please?

Thanks, Richard. Look, I think from a New Zealand point of view, let me come to that first. So New Zealand had a first quarter impact because of the OCR reductions in New Zealand. That largely flew through between the first and the second quarter in New Zealand. But if I look at New Zealand overall margins, partly -- and I think the first was OCR, the other aspect was also the fact that we probably saw a higher proportion of fixed home loans, probably one of the highest in recent times in New Zealand as people try to lock in the lower rates. So that also had an impact on margin. The housing market competition obviously impacted us as well, but this was offset to some extent by TD margins and deposits.

So it's been a balancing act in New Zealand, as we've always done to make sure that we maintain return discipline in that business. But overall, if I look at the trend, I would argue that the first quarter to second quarter transition reduced margins. But if I look at February to now, we actually have had pretty stable margins in New Zealand overall. So we haven't really seen a deterioration since February on margins, and we expect that to likely continue, and we'll have to see where the rate environment takes us going forward, which certainly looks like it's starting to turn back up again. On Institutional NIM, they're trending modestly lower, partly driven by competition that you can see in peers as well and both on the lending book as well as on the deposit book. But again, we continue to monitor and manage our Institutional business on returns and ensure that we are looking at the whole of customer relationships rather than a pure lending basis.

Your next question comes from Victor German from Macquarie.

Looking at the individual building blocks, the revenue trends appear pretty solid. Your margins, excluding Markets were up 4 basis points, loans, excluding Markets, grew by about 1.5%. And while markets income declined, the reduction was only around $50 million. And when you take it all together, it just makes it quite difficult to reconcile broadly flat income outcome for the half.

So Farhan, maybe could you perhaps help us kind of bridge that gap? And specifically, does this imply that noninterest income ex Markets declined meaningfully? And if there were any one-offs either this half or the previous half that we should be considering, it would be very helpful. And also just to clarify your earlier comment about liquids because it's somewhat difficult to assess given that Markets business actually manages liquids portfolio. Can you just maybe confirm that the net impact of liquids to Group margins is 0, including Markets?

Okay. So let me answer the first one -- the last one first. The answer is yes, the liquid assets, including Markets, is 0 in the third quarter. On the other question, and there was a lot in there, so I'm going to try and see if I can get to all your questions, Victor. But overall, no, there wasn't anything in particular to call out in revenue in the third quarter, which stands out. There was no big one-offs. So we had improvement in net interest income, as we called out. Now, again, we have to think about whether we're talking constant currency or we're talking reported. But overall, I would say that the net interest income travel was in line.

Of course, the month of June was particularly strong in terms of asset growth. So from an AIEA point of view, AIEA might be slightly lower than what the month of June represents in terms of asset growth. So that may not have fully come through in net interest income. On the other hand, you saw the decline in Markets and other operating income. The decline in other operating income wasn't substantial. It's just the combination of all of those things effectively led to a flat reported outcome on net income. And again, part of the reported outcome was impacted by the fact that it had a $91 million negative FX impact in those numbers as well for revenue. Now, part of that gets offset by hedges in OOI, but not in NII.

Okay. So it sounds like it might...

Does that help, Victor?

Yes, no, it does. I mean it sounds like maybe the average interest-earning asset growth was much lower than 1.5% balance sheet growth in the quarter, and that should be coming through in the fourth quarter? Is that right?

That's correct. I think the way to think about it is 2, 3 things. Firstly, yes, you're right on the month of June, but that gives us good exit momentum into fourth quarter. On the other hand, if I -- as I said, there wasn't anything in particular to call out from a margin or one-off perspective as well. So no, nothing unusual really, Victor, as I think through it.

Your next question comes from Matt Dunger from Bank of America.

I just wondered if I could ask about the Markets revenue, specifically the customer franchise revenue. You called out the commodities space. Coming into the fourth quarter, we've seen some risk-weighted asset growth. How should we be thinking about growth in the customer franchise Markets revenue?

Thanks, Matt. Look, I think the -- as I said, so commodities gold prices being low impacted Markets commodities business. So that obviously was one big part of it. The other is that when you're looking at very steep yield curves, both in Aussie dollars and in U.S. dollars, you would tend to -- customers tend to go to the shorter end of FX and rate hedging activity, and that obviously impacts revenue and profitability as well. Now that returns to normal once the yield curves sort of flatten out a bit more, but we did have particularly steep yield curves more recently, and that impacted FX and rates business, but not because of any other underlying reason from a customer activity perspective. So I don't think there's anything -- from a risk-weighted asset perspective in Markets, though, there hasn't been any particularly strong growth in RWA in Markets.

Your next question comes from John Storey from UBS.

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I've just got a question just around the channels through which some of the growth is coming through. Obviously, very strong growth of back to system growth in mortgages and relatively robust growth in business banking. Just if you could comment on where that growth coming from, from a channel perspective.

Can you just repeat the question again? Sorry, John, I missed that last bit.

Yes, sure. Just thinking about the economics of some of the growth that's coming through. So I'd be interested to understand, is this broker-driven? Or is it through your proprietary channels? Obviously, you've got a strategy to try and drive prop, I guess, particularly in mortgages. But I'd be interested too, just around business banking, right? Is that coming through brokers? Or is it coming through your own channels?

So look, I think on the Retail side, on home lending, in particular, there hasn't been a particular shift in terms of our mix between broker and prop channels. Obviously, we are investing now in prop channels in terms of our branches, in terms of bankers and branches, in terms of banker tools, in terms of branch refresh, et cetera, et cetera. All of that is underway, but that hasn't impacted immediately now on the split between broker versus proprietary. So that -- and we don't expect that to change very quickly. Of course, we hope that it will continue to improve progressively. On the business bank side, I think it was probably more on our own channels rather than through broker that the growth came through in June.

There are no further questions at this time. I'll now hand back to Kylie Bundrock for closing remarks.

Okay. Thank you, everyone, for joining the call today. And if you have any follow-up questions, please feel free to reach out to the Investor Relations team. Thank you.

Thank you.

That does conclude our conference for today. Thank you for participating. You may now disconnect.

Good morning, everyone. I'm Kylie Bundrock, ANZ's Group General Manager, Investor Relations and M&A. Thank you for joining us for the presentation of our first half 2026 financial results. which are being presented from ANZ's offices in Melbourne and stand on the lands of the Wurundjeri people. On behalf of the ANZ team, I pay my respects to elders past and present and also extend my respects to any Aboriginal and Torres Strait Islander people joining us for today's presentation.

Our results materials were lodged this morning with the ASX and are also available on the ANZ website in the shareholder center. A replay of this results presentation session, including Q&A, will be available on our website shortly after this session concludes. The results presentation materials and the presentation being broadcast today contain forward-looking statements or opinions. And in that regard, I'll draw your attention to the disclaimer in the front of the results slide pack.

Our CEO, Nuno Matos and CFO, Farhan Faruqui will present for around 45 minutes. After which, I'll go over the procedure for Q&A before moving to questions. Ahead of that, a reminder that if you would like to ask questions, you can only do that via the phone. And so over to you, Nuno.

Thanks, Kylie. Good morning, everyone. Thank you for joining us. It's almost a year since I joined ANZ as CEO, and this has been a period of significant change for our bank. During this time, we launched a refresh strategy, ANZ 2030, including the definition of our strategic pillars and initiatives, clear guidance of our major financial metrics and we outlined our 5 immediate priorities. In parallel, we made good progress in clarifying our dividend outlook as well as strengthening our capital position and increasing our collective provisions and coverage ratio.

These changes have resulted in better managed more than business, which is delivering stronger financial results. While we are early in our transformation, we are already more focused on our customers, simpler, more resilient and have materially improved value for our shareholders. Before turning to performance, I will take a moment to reflect on the external environment. As Australia's most international bank, we have a front row seat to global developments. The real impact of this crisis remains ahead of us. with a physical flow of critical commodities from the Middle East being key. While we have made a small downward adjustment to our global GDP forecast, at this stage, we'll still see the global economy growing at around 3.2% this year.

In Australia, consumer and business confidence is materially weaker. However, spending and business conditions have only impacted modestly so far, and employment growth is stable. This supports our central expectation that Australia will avoid a recession. Although the situation is extremely dynamic and we are prepared for a range of outcomes. The longer the flow of oil is constrained, the greater the chance that crisis shifts from being primarily an inflation challenge, to more of a supply and growth challenge with greater economic impact.

Turning to our customers. Generally, corporates have been taking prudent steps by shoring up liquidity, prioritizing optionality in their treasury management and perhaps most importantly, improving supply chain resilience. For large corporates in sectors which are most impacted such as transport, energy and construction, we are starting to see an increase in working capital needs, reflecting higher input costs longer shipping routes and buffers for future disruption. Unlike other recent disruptions, capital markets have remained open, reducing the need for customers to solely draw on bank lending lines.

While our business banking customers in Australia and New Zealand generally entered this period well prepared for smaller businesses, particularly in the impacted sectors higher operating costs are placing pressure on margins and cash flow. We are supporting our business customers through this time including by offering 0 interest loans through the Australian government's $1 billion economic resilience program, where we are already seeing strong demand.

Turning to our retail customers. households in both Australia and New Zealand entered this period with high saving buffers. And we have not seen any material increase in hardship applications. However, in recent weeks, consumers have needed to sharply increase spending on transport, leaving them with less discretionary spending. We will continue to monitor emerging pressures and support our customers with appropriate assistance. The impact of the current crisis on ANZ's credit, capital and liquidity position has been minimal as of today. Our business is strong and structured to allow us to adapt the periods of uncertainty.

First, we have very limited direct exposure to the Middle East at less than 0.5% of our total group exposure, and we are focused on high-quality investment-grade counterparties. Second, we have a strong balance sheet and continue to have good assets to funding markets with limited increases in funding costs. As one of the world's most highly rated banks, we remain an attractive destination for global debt investors and depositors. And third, we are seeing the benefits of actions taken to transform the profile of ANZ's portfolio over the last decade. This includes prioritizing capital-light flow business over lending, while 83% of our wholesale portfolio is investment grade as relected in our continuing low loss rates.

That said, the situation is dynamic and the longer it continues, the greater the impact. Reflecting this raised risk in the external environment, we have taken a collective provision charge of $126 million this half with our provision coverage ratio up 4 basis points to 1.22% in the half and up 9 basis points since March 2025.

Now turning to our performance for the half. Our return on tangible equity was 11.6%, an improvement of 161 basis points. In parallel, our balance sheet and capital position remains strong with common equity Tier 1 at 12.39% at the end of March, having improved 36 basis points from September. We proposed an interim dividend of $0.83 per share and increased the franking rate to 75% from 70%, reflecting our improved performance in the Australian geography. Our capital levels are appropriate. As a result, we will not apply a discount to the dividend reinvestment plan for the interim dividend which will now be neutralized.

When we launched the ANZ 2030 strategy, last October, we were clear that this is a 2-phase strategy. The first phase across FY '26 and '27, it's about delivering on immediate priorities at pace in order to get the basics right including a substantial improvement in productivity and initial investment for growth. In the second phase, beyond '27, we will realize the benefits of those strong foundations to drive outperformance. In each phase, we expect to improve returns and deliver value. We are now 1/4 of the way through the first stage and already showing tangible progress. We are also investing in capabilities now to execute the second phase, which will differentiate ANZ from our peers while significantly improving our customer experience and the strength of our human and digital channels.

As I said at our Strategy Day, we have 5 immediate priorities and we're committed to regular updates on our progress. First, our new leadership team and our culture reset, last year, we announced 4 new executives who are now firmly embedded in their new roles. Most recently, we appointed Tammy Medard as the Group Executive Business and Private Bank. And just last week, we took another important step in launching our new corporate values aligned to our purpose and our strategy. These values are not a slogan or catch phase. They are action-oriented values, which will guide our people to deliver best outcomes for our customers and shareholders safely and consistently and at pace.

At Strategy Day, we're committed to a safe and secure migration of Suncorp Bank customers to ANZ by June 2027. This program of work was reset in October 2025. At the end of March, we have delivered 34% of this program, and our plan is to get to 57% by the end of this financial year. We remain on track to complete the migration by June '27. During the half, we strengthened the program operating model to support timely decision-making and delivery with clearer accountabilities and enhance executive oversight. We also made progress building and testing the product solutions required for the integration as well as the core data solution and new end-to-end testing environment.

Through this process, we will meet all of our federal and Queensland government commitments. At Strategy Day, we're also committed to delivering a single customer front end by September 2027. Again, this program of work was reset in October '25. By March, we completed 13% of all this work and expect to have completed 45% by the end of this financial year. We remain on track for full delivery by September 27. Once complete, will serve individuals and small business customers with a single ANZ digital platform and brand. This will bring together the ANZ plus experience with the broader products and functionality of ANZ's existing retail and business platforms.

We have made significant progress on our fourth immediate priority, simplifying the bank and reducing duplication. We reduced costs by 9% half-on-half, excluding significant items. And as a result, our cost-to-income ratio reduced to 49.4%, down from 54.6% in the previous half. When launching the strategy, we said we expected the impact of this initial productivity improvements to yield pretax gross cost savings of around $800 million in FY '26. We have realized 49% of the identified productivity savings, and we are on track to deliver in excess of this in the full year. Farhan will provide more detail.

By the end of April, 78% of our announced 3,500 employee exits had occurred as well as more than 1,000 managed services consultant departures. Fifth, we are making good progress on our nonfinancial risk management uplift and remain on track to deliver our root cause remediation plan approved by APRA last September. This is a comprehensive framework that details the activities of our enterprise-wide PACT program standing for people, accountability customers and trust.

Today, we have released the second report by Promontory, the independent reviewer appointed to access this progress and the regulatory reports -- and regular report, sorry, to APRA and the Board on the execution of the RCRP. All reports are and will continue to be available in full on our website. We are now through the setup phase of the PAT program and on track to largely complete the design phase this year. Last September, we also announced that ANZ had established an ASIC resolution program within our federal retail end markets to deliver improvements across a number of areas. This work is progressing and constructive engagement with our regulators on these important matters continues.

I will now turn to the strategic initiatives across our divisions with a focus on the customer first pillar. This includes progress in laying the foundations for the second phase of our strategy to accelerate growth and outperformed the market beyond 2027. In Australia Retail, excluding Suncorp Bank, we have 6.5 million customers and 11.6% of the market viewers as their main financial institution. Our strategic NPS was stable at 2.9, and we remain an uncomfortable #4 of the majors. Total deposits grew 2% with 1% growth in Transact and save.

Home Lending grew 1% at 0.36x system in the half. Having improved service and assessment levels in our home loan business, we increased momentum throughout the half to 0.85x system in March. We expect to be around system or a system in April and in the second half. This will be further supported by us having joined the first homebuyers guarantee scheme. Under our ANZ 2030 Customer First strategy, we are laying foundations for growth through deep propositions for attractive customer segments, including migrants and mass affluent, strengthen proprietary origination and elevated channel experience. Early progress on our customer acquisition enhancements includes enabling New Zealand customers relocating to Australia to open accounts before arrival and launching competitive digital international money transfers to meet core migrant and affluent needs.

Alongside this, we are upgrading our physical and digital channels, including the delivery of the single customer front end in 2027, the ongoing modernization of our call center platform and ATM fleet and a branch refresh across our network. In our Business and Private Bank, which has 580,000 customers, excluding Suncorp, MFI share was steady at 16.4%. Business Bank save and transact deposits and lending grew by 2%, with lending continuing to lock the markets. NPS for the division was down to minus 0.4%, again, an uncomfortable fourth position. Our transformation is focused on improving customer experience and accelerating growth.

In contrast, the private bank performing -- the private bank is performing quite well. Deposits increased by 6%, investment funds under management were up 8% and lending rose 17%. We were recognized with 4 awards by Euromoney, including our Australia's best private bank. Under our ANZ 2030 Strategy, the transformation of the business bank will be driven by building a frontline that matches our ambition in size and quality and ensuring we have the right platform for the right customers, while leveraging our strong private bank foundations. In short, our ambition is to have more business bankers who are highly skilled with better tools.

In this regard, on the front line, our initial focus is on upskilling our business bankers with our upgraded Banker Academy ready for its first major intake. In this half, we have equipped them with better tools, having launched agenting AI-enabled capabilities in our CRM. With the Rod foundations in place, we remain committed to increasing business bankers by close to 50% by 2030. On platforms, we are accelerating the delivery of the single customer front end for small business customers. And for our larger business bank customers we are releasing a new set of improvements to Transactive Global to make it simpler and more agile for this segment.

For Private Bank, we recently completed a stategic review of our products, services, people and platforms, and we are moving forward in accelerating this business. Suncorp Bank NPS and MFI continued to perform well with a stable customer base of 1.26 million. We look forward to bringing these customers into the ANZ franchise by June '27, delivering benefits of scale and experience to both our customers and our shareholders.

Our institutional business continued to deliver strong and consistent earnings, with 2 highlights, 8% growth in operational deposits and 8% growth in market revenues, both FX adjusted half-on-half. Our institutional business is relationship-led with a unique international network and unified digital platform. We have a clear strategy focused on transaction banking services delivered through market-leading platforms, a capital-light profile and target customer acquisition. We are seeing the benefits of this strategy.

Around 1/4 of our strong operational deposit growth has been driven by new clients across target sectors, including financial institutions. Our customers benefited from our continued improvements to our transactive global platform as well as data and insights from our markets platforms, which is helping them manage risk during a period of financial market volatility. In institutional, we have been clear that we focus on supporting our customers in lending in the context of a holistic relationship while balancing risks and returns.

Finally, we recently announced an agreement to acquire Worldline's share in our merchant acquiring joint venture, moving us to full ownership. This will allow us to regain control of the merchant customer relationship and ensure it is consistent with our strategy to be a leading payments and transaction bank. In New Zealand, ANZ remains the largest bank with 2.7 million personal and business banking customers. Refreshed customer propositions helped increase personal and business MFI share to 33.3% and 31.6%, respectively, at the end of March.

On the other hand, our NPS for both personal and business remains a challenge to be addressed. Save and transact deposits grew in the first half by 4%, in line with the market. In New Zealand, we gained share in total deposits and lending across personal and business and agri with the only exception being home lending. To build on our existing scale, we are replatforming for the future to bring the customer experience in line with our leadership position. refreshing our propositions and investing in business bankers.

The replatforming rollout is well underway with the successful migration of customer records to our new model baking platform completed in the first half. Now before I hand to Farhan, I would like to leave you with 3 key messages. Our transformation is running at pace and we are making good progress in executing our 5 immediate priorities safely, sustainably and on time. In parallel, we are investing in line with our ANZ 2030 Strategic initiatives, to deliver for our customers, accelerate growth and outperform the market beyond 2027. And importantly, we are already delivering materially better returns for shareholders.

With that, I will hand over to Farhan. Thank you.

Thank you, Nuno, and good morning to everyone joining us today. We are 6 months into Phase 1 of our ANZ 2030 Strategy. and we have made solid progress this half. As I noted at the end of last half, our focus is on sustainably improving our performance, and that means simplifying our organization to drive more efficient outcomes maintaining a strong balance sheet and capital position and improving returns for our investors. We have delivered on each of these with progress across all our key financial metrics. .

Return on tangible equity increased by 161 basis points to 11.6%. CET1 capital ratio increased by 36 basis points to 12.9%. Cost-to-income ratio improved by 519 basis points to 49.4%. And revenue to risk-weighted assets increased 15 basis points to 4.88%. Importantly, our performance delivered value for our shareholders with a total shareholder return of 10.7% in the half. Dividends were maintained at $0.83 per share and the franking rate increased from 70% to 75%.

As a result of our strong capital position at the end of this half, we will now not be undertaking a second discounted DRP, and the interim DRP will be neutralized. In the first half of '26, the group delivered a cash profit after tax of $3.8 billion. Excluding the significant items announced in the prior half, cash profit increased by 14%, and profit before provisions increased 12% half-on-half. I want to particularly call out the FX movements, which were more pronounced in this half. As previously reported, we hedge a large portion of our non-Australian dollar earnings. And over this half, these hedges helped offset the adverse FX translation impact. In revenue, we had a negative translation impact of $205 million and a hedge benefit of $19 million -- $99 million in other operating income.

In expenses, we benefited from a positive translation impact of $107 million. Therefore, added profit before provisions level the net FX impact was fully neutralized by our hedging strategy. I'll now step through the key drivers of results, starting with revenue. Our half-on-half comments will be based on comparisons to second half '25 financials, excluding significant items. Revenue was flat in the half. However, on a constant currency basis, and excluding the hedge benefit, group revenue increased 1%. On this basis, net interest income was broadly flat. Deposit volume growth and margin management were offset by lending revenue. In addition, lending volume growth softer in the half particularly in Australia Home Lending and the Business Bank.

Other operating income ex markets increased by 2%, and markets delivered another solid result with revenue growth at 8%. I will talk more to deposits and lending volume as well as markets income shortly. Now moving to margins. Headline margin was 1 basis point lower in the half, while margin ex markets was up 2 basis points, reflecting our disciplined approach to margin management. I'll walk through the key factors that impacted NIM this half. Number one, we continued to optimize deposit pricing offsetting the impact of rate cuts and offshore markets in the half, delivering an overall flat margin outcome for deposit pricing.

Asset and funding mix added 2 basis points with growth in save and transact deposits as well as overall deposit growth outpacing lending growth. Three, our replicating portfolios added 2 basis points, benefiting from higher rates and our decision to modestly lengthen the duration of the portfolio; and four, timing impacts from RBA rate changes as well as continued Australia home loan pricing competition drove a 3 basis point asset pricing reduction in the half. When adjusted for temporary factors, we exited March with group NIM consistent with the overall first half average of 1.53%.

In terms of outlook, we remain disciplined in our execution. Looking forward, we face both tailwinds and headwinds, we anticipate that higher term rates in our house view of further RBA and RBNZ cash rate increases will be supportive to NIM. In particular, a further 7 basis points of tailwind to NIM from replicating portfolio earnings is expected over the next 12 to 18 months. However, sustained levels of competition and customers shifting to term deposits as rates increase presents potential margin headwinds. Based on these factors and noting that margin outcomes may vary from quarter-to-quarter. We see a bias to the upside in NIM ex markets in the next half.

Moving to the balance sheet. Ex markets, customer deposits grew by $11 billion in the half, and the performance was stronger on a constant currency basis, with deposits up $20 billion. Volumes grew in all divisions, with the exception of Suncorp Bank where deposits were broadly flat. Core to our strategy is deepening customer relationships and improving the quality of our deposit base. With this focus, we grew our Save in Transact deposits by $16 billion on a constant currency basis this half, delivering a positive mix shift.

Operational deposit growth of 8% and on a constant currency basis was a particular highlight in our payments and cash management business. On the same basis, these deposits have grown 28% over the past 2 years as we continue to prioritize serving the transactional banking needs of our institutional clients. While deposit growth and mix were positive this half, Australia retail deposit growth remained below system and remains a focus, as Nuno has highlighted.

Turning to lending. On a constant currency basis, customer loans and advances increased by $16 million in the half, with all divisions contributing to the growth. In Australia, retail, home loans grew $5 billion, reflecting below system housing growth. As Nuno has said, we expect to be at or around system in April and in the second half. Growth across Business Bank was mixed and below the broader market. This business is in transformation, and we are investing to accelerate growth. In New Zealand, business and agri lending grew at 1.1x system, and home lending grew 0.8x system in a highly competitive market, characterized by a record level of customer switching and migration to lower-margin fixed rate lending.

In institutional growth this offers in shorter tenor supply chain trade finance. This was pronounced particularly towards the end of this quarter as customers started to secure their supply chain inventories given the current geopolitical environment.

Turning to markets. The business again delivered consistent high-quality earnings with income of $1.1 billion, up 8% this half and up 7% on the prior first half on a constant currency basis. This outcome reflects increased customer activity across key products, FX, rates and commodities income all increased compared with the same period last year. In FX and rates, customer demand for structured products increased as customers sought to mitigate downside risks in this environment. In commodities, demand for gold underpinned performance this half. These positive contributions were partly offset by lower franchise credit income due to wider credit spreads.

Balance sheet revenues also grew, driven by higher liquid asset volumes and improved yields. The result was further supported by geographic diversification with 72% of markets income generated outside of Australia providing an important and resilient source of earnings diversification for the group. Looking ahead, our markets business remains well placed to continue to support our customers as they navigate volatile markets. That said, in periods of extreme volatility in financial markets, customers tend to step back from risk management activity and adopt a wait and see approach. This could be a headwind in a prolonged Middle East conflict.

Now turning to expenses. At the full year results last year, we outlined actions to remove duplication and simplify the organization. We delivered a 9% half-on-half reduction in operating expenses and 8% on a constant currency basis. This reflects a substantive shift in how we manage costs and drive operational efficiency across the organization, representing a structural reset of our cost base. Specifically, 78% of the 3,500 FTE reductions have exited the group as at April 30. More than 1,000 managed service contractors were exited at the start of the financial year. We also optimized third-party spend by consolidating and rationalizing our vendor base, reducing total vendors by 80%.

We exited noncore businesses and activities at pace. These exits reduce complexity and lower costs in the half. Together, these actions are delivering a step change in cost discipline and realizing approximately $392 million of productivity in the first half. Suncorp Bank synergies contributed a further $29 million of first half productivity primarily from the removal of duplicative project spend. Investment spend overall was lower this half, reflecting both the seasonal phasing of spend and stopping initiatives not aligned with our strategy. We will remain within our full year investment envelope of approximately $1.5 billion.

Our expense rate for investment continues to be sector-leading approximately 80%. At the full year results, we outlined an expectation that FY '26 costs would be down approximately 3% from the $11.85 billion baseline which reflects the FY '25 cost base adjusted for significant items. Our productivity program is now on track to deliver an estimated $875 million of savings this year, up from our previous target of $800 million. In addition, we expect an FX translation benefit of $210 million this year if FX rates remain consistent with the first half average.

As a result of our recent agreement to acquire Worldline shares in the ANZ World a mention acquiring joint venture, we will consolidate the expense base of the business post regulatory approvals. We remain confident that this expense impact can be absorbed within our overall outlook. Taken together, we are updating our expense outlook. We now expect costs to be down approximately 5% in FY '26 from our FY '25 cost base adjusted for significant items of $11.85 billion.

Let me turn now to portfolio quality. We recorded an individual provision charge for the half of $148 million, including $79 million of our wholesale and small business exposures. This resulted in an annualized individual provision loss rate of 4 basis points, which has now remained stable for 3 consecutive halves and is well below our long-run loss rate of 11 basis points. Our low individual provisions are the product of portfolio derisking over several years to strengthen our asset quality. We have been monitoring developments in the Middle East, where we have limited exposure, less than 0.5% of total group exposure.

This exposure is focused on investment-grade government-related entities, central banks, sovereign wealth funds and sovereign backed corporates. We believe these customers are well placed to withstand stress, and we continue to support them. Our institutional portfolio continues to be high quality, with over 92% of our institutional exposure investment grade. Importantly, nearly 2/3 of this exposure is to financial institutions and sovereigns where we've had near 0 basis points loss experience since the GFC.

For Business and Private Bank, we continue to focus on ensuring strong levels of collateral coverage with 83% of exposure being fully covered by collateral and a loss rate of 13 basis points in the half, down from 20 basis points in the second half '25. Our Australian mortgage customers delinquencies decreased 3 basis points in the half to 83 basis points. And our mortgage customers continue to show resilience with 88% of accounts ahead on repayments and approximately 70% of our customers holding savings buffers of 3 months or more. Similarly, our New Zealand mortgage portfolio delinquency decreased by 6 basis points in the half, down to 80 basis points. Now while we have not seen a material increase in customer requests for hardship relief, we are very conscious of the stress from higher interest rates and cost of living pressures. We are closely monitoring and providing support for our customers against this evolving macroeconomic backdrop.

Now moving to collective provisions, where we considered the Middle East conflict and took a balanced view at the end of March. Transmission to the broader economy is still at an early stage, and our portfolio is strong. but there are clearly risks to both the domestic and global economies, especially if the conflict is not resolved in the near term. We have reflected this view by increasing the weighting to our severe scenario by 2.5%. This increased our collective provision charge by $175 million. Over the half, we also made adjustments to our overlays. And together with portfolio growth, credit quality improvements and model changes are resultant collective provision charge for the half was $126 million.

Overall, the collective provision balance has increased to $4.45 billion, lifting coverage by 4 basis points to 1.22% of credit risk-weighted assets. This new collective provision balance represents a post-COVID high in coverage levels. with the collective provision balance now around $2.5 billion above our base case scenario and $65 million above our downside scenario. In reviewing the adequacy of our settings, we also considered, one, our scenario rates are now skewed 52.5% to our 2 downside scenarios, reflecting the current volatile geopolitical environment.

Two, existing collective provision balance levels cover 13x the individual provision losses taken in FY '25 and 20x based on the average of individual provision losses taken since FY '23. This is well above peers. Three, the continued resilience of our high-quality onshore and offshore portfolios as evidenced by consistently low individual provision loss rates. Overall, these settings reflect an appropriate approach and we will continue to actively review our provision balance as conditions evolve.

Now turning to capital. As I noted earlier, we have taken decisive action to strengthen our capital position, and this is reflected in our CET1 show increasing to 12.39% as at March. The dividend remained stable at $0.83 per share and franking increases from 70% to 75%. This higher franking reflects the improving performance of the Australian geography. At FY '25 results, we had announced the potential to discount the first half 26 interim dividend, subject to our capital position and needs at the time. As I mentioned, this discount will now not occur and the DRP will be neutralized. This is reflective of our improved capital position, including the benefit of higher participation in the full year '25 discounted DRP and clarity on the direction of the RBNZ capital changes. It is also our intention to continue to neutralize future DRPs.

With a stable dividend and improving profit, the payout ratio has reduced to 66% and is now broadly in our target range of 60% to 65%. Our payout ratio at this level retains capital for the underlying growth capacity to deliver on our ANZ 2030 strategy. We welcome the announcements in recent months from both the RBNZ and APRA regarding capital settings and capital reviews and agree that these will encourage better capital management and importantly, better alignment between the risk -- between risk settings and capital allocation.

Notwithstanding some of the recent volatility in the markets and a modest increase in funding costs we have continued to have good access to funding markets and a strong liquidity position. Key funding and liquidity metrics remain well above regulatory minimums. However, uncertainty is heightened, and this is an area we will continue to monitor closely. In closing, I wanted to reiterate the financial targets we have set for ourselves, including the upward revision to our productivity target for FY '26. Phase 1 is progressing as intended and the delivery is now evident in the numbers, improved returns, higher efficiency and strong balance sheet settings while continuing to invest in franchise.

As conditions evolve, including ongoing geopolitical uncertainty, we will continue to actively manage our balance sheet and risk settings and support customers as needed. Our priorities and targets under ANZ 2030 remain very clear. We will continue to report transparently at every result, and we will be held to account on delivery.

Thank you, and I'll now pass to Kylie for Q&A.

Thanks, Farhan. [Operator Instructions] I will now hand to the operator for questions. Thanks, Darcy.

[Operator Instructions] Your first question comes from Andrew Lyons with Jefferies.

Just 2 questions. Just firstly, on your capital position. Slide 63 highlights that the risk impacts were a tailwind for your core equity Tier 1 ratio by lower credit risk-weighted assets in 1H '26, as it has been in recent half. However, I'd just be keen to sort of understand the sensitivity of your capital ratios to a deterioration in the macro economy. So can you maybe just talk to if the macro economy plays out per your base case assumptions that you use in your ECL modeling. How do you expect the risk impact within your credit risk-weighted assets to play out over the next couple of years? And maybe I can to ask what it would look like in the downside scenario as well?

Yes. No, thanks for that question, Andrew. Look, I think we are actually -- from a base case scenario standpoint, we have -- I don't have the numbers for the next 2 years or so, Andrew, but I can tell you that over the next 6 months or so, we haven't estimated, if you were to move to the base case, we would have an estimated $3 billion increase in RWA, which would basically equate to approximately 9 basis points of capital. If we -- I don't have a downside scenario assumption, but I would imagine, obviously, it will be much higher than $3 billion. .

Yes. Okay. No, that's really helpful. And then just a question around your mortgage lending. APRA data yesterday highlighted that you are clearly closing the gap to system in your mortgage lending? I guess 2 parts to the question. Firstly, how should we think about the NIM implications of reinvigorating growth both from the perspective of more aggressive mortgage pricing but also the need to fund that high level of growth? And then also, historically, your systems have impeded your ability to manage a big recovery in volumes. Can I perhaps just ask to date how effectively your systems responded to higher volumes that are now coming ANZ way?

Sure. So this is a topic that we addressed in the last quarters. And we talked about it at length and I think now we are seeing the results of our first actions in this regard. The first thing I would say is we are not targeting mortgage growth just from a growth perspective. We want to grow in a profitable manner. That's the first thing we want to say. So in terms of the levers, we've been working on it. Pricing has been one that clearly we paid a lot of attention. We moved from some competing at structural discount into competing using pricing as another lever tactically when it makes sense. It means we use discounts for a specific segment that we believe is more profitable than others. We don't do discounts across the board.

We are not anymore the cheapest in the market. We changed our competitive stance. And we will keep it that way for the future because, again, as we've been saying, we are targeting sustainable and profitable growth. We also continue to manage aggressively our processes and improving the way we underwrite the way we process loans. And in that regard, as we said, we had significant improvements in this half. We had issues with our loan processing team in last years. that's basically done. That's digested. We have now the right size of a team. We are now in SLAs in market SLAs for basically all products and that's why we feel confident now to regain market flow.

As you can see in October -- sorry, in March, we are very close. And in the second half, starting in April, we should be at market or around market. But we are not only relying on process improvements. We are also improving significantly the quality of our distribution, and that means our proprietary origination teams, we are very much focused on productivity. And that's already a plus in this half. We're able to produce more tickets per individual per lender in our mortgage business. And the way we interact with brokers was also significantly upgraded in terms of time and in terms of experience. But we are also touching the product lever. For example, in the half, we're able to in record time, launch, and we were lagging, to be honest, we were able to launch our first homebuyer proposition.

We entered the scheme. This is an important scheme. It represents roughly almost 10% of the market, so we should be there. So we are touching other levers product, distribution, processes and pricing, and we are getting out of only competing based on pricing, as we've been saying. With that, the production that we are bringing to our balance sheet from the market, it's accretive, and we are comfortable that it will not hurt our margins in the future.

Your next question comes from Ed Henning with CLSA.

First one on margin, the second one on costs. Just the first one on margin. I just confirm, Farhan, what you said on the call is the exit margin was the same as the half, but there's an upward bias. And the upward bias just on the replicating portfolio with the headwinds on competition and stuff a little bit more muted than what you're seeing currently in the environment on the replicating portfolio?

Yes. So thanks, Ed. The -- I talked about the bias to the upside in the next half. It is driven to a great extent by a replicating portfolio. As I said, we have a 7 basis point tailwind in the next 12 to 18 months on replicating portfolio. But majority of that actually comes through in the next half. So that actually is supportive to NIM as well as, obviously, the fact that we have more rate hikes baked into our current house view from both RBA and RBNZ. So I think overall, we feel that we are likely to see more upside on NIM than we are to see anything else from a headwind perspective. .

But -- and just to complement what Farhan is saying. The reason Farhan is saying is the bias up and it's not a full up, obviously, is that we have impacts on both sides, right? Clearly, with higher rates customers will migrate to lower margin products on the funding side. So you would expect that both consumers and small business would migrate to, for example, term deposits. And we also have potential in our offshore business, U.S. rates coming down with a new -- let's say, with the new environment on the Fed. So they are undoubtedly very important tailwinds but not just on one side. There's others also on the other side, but it's a net up. That's what we think.

Yes. And I would just add to that, that some of those headwinds are starting to -- the green shoots of that is starting to show up. So we are starting to see a little bit of activity towards switching into, say, term deposits, et cetera, away from save and transact.

That's great. And just a second question on costs, just to clarify the increase in the savings coming through for '26. is that additional productivity savings, that's not a bring forward of any Suncorp synergies there? And now also with your guidance improved to down 5% this year. Previously, you were indicating likely the '27 will be down again from '26. Does that still hold? Or is that a bit more of a challenge? And obviously, you've got -- you've talked about growing your bankers and staff and it depends on your timing around that as well.

Yes. Let me recap where we are here and reminding you what we guide on this topic. We guide $800 million savings this year and then net of inflation get equated to a 3% reduction on costs. We are now guiding to a 5% reduction on cost for '26, and that means $875 million of savings, not anymore $800 plus the FX -- sorry, yes, the FX translation on the cost line. So if you want the 5%, it's a simple math of the previous 3% plus 1.8% impact of FX translation, plus an additional 0.2% of savings, which is around $75 million.

We also would like to remind that we acquired the stake in Worldline, which makes us now the -- let's say, the full -- we have now full ownership. And that includes -- so we are going to absorb on those 5%, we are going to absorb the additional costs that we'll have by consolidating the Worldline company in our books. So it's a 5%, if you want, is 3%, 1.8% of FX, additional 0.2% of savings and no additionals on the Worldline. On your question of '27, I want to remind you, we did not guide '27. So we did not disclose any guidance in '27. What I can tell you is that we are not moving forward '27 savings to '26. It's not about that. It's to continue to make the company more and more productive. And as we continue to be highly focused on finding those efficiencies, we are not exiting in taking them, and we continue to commit to the mid-40s cost-to-income by 2028.

Yes, just to answer a little bit of your question. So in addition to what Nuno said about not moving forward to synergies from '27. We're also not -- we're also reporting, as you know, at the Suncorp synergies separately. So the $875 million, the new guided number does not include the Suncorp synergies that we're producing, which is separately tracked and I mentioned that in this half was $29 million. So the $875 million does not represent any moving forward of Suncorp synergy benefits. .

Your next question comes from Tom Strong with Citi.

Firstly, perhaps just on the progress of the Suncorp migration and the delivery of the customer front end. I mean you further in front on the migration side, but can you just put a bit more color around the next 12 months around where the material points of financial risk are and technology delivery. So we've got a bit more of a better idea of what to expect and the ability to hold the store count over the next year?

Well, I believe you have -- we have announced for those 2 projects clear time lines in terms of where we expect that to be concluded. And I repeat, September '27 for the single customer front end, which means -- why is this so important? It means that by then, we'll have 8 million customers or retail and small business customers in one single platform. one single brand from what we have today, which are many, right? So it's not a small thing. It's a big thing. We reset the program in October, September '25, when we came to the market with our new strategy, and we start measuring all the tasks we have to do from that date until September '27, we start measuring them.

Obviously, the program started. We have many things that we are leveraging on top from the past. So it's not that we are starting from 0 obviously. But we reset the program and we said what we have to do from September '25 on, we had a book of work, and we are now measuring that execution. We are at 13% in March '26, and we are very clear that we want to be at 45% by the end of this year. So I think you can take that as a clear pace.

Basically, the project will be almost half done 1 year before the finish line. On Suncorp integration, we are at 34%, again, of the reset book resetting the clock at 0 in October '25. A lot of work had been done before. But again, we calculated the remaining book of work and we started from that at 0, 34% at March '26. We expect to be at 57% at September '26. So you will -- we will be publishing every quarter, by the way. In Q3, when we launched -- when we will publish to the market, we will publish again those percentages. And you will be -- every quarter, you will have a very clear definition on where we are.

These programs are not long term anymore. They are next year. It's going to be very easy for you to test if we are on time or not. From a financial perspective, from an investment perspective, we have clear definition of the, let's say, required investment. And we are -- again, this is not long term. We are very convinced that there won't be any material deviations from the numbers we have in our investment planning.

And just to add to that as well, Tom, no deviation. All of those investment asks for both Suncorp bank integration as well as the single customer front end are fully baked into our 5% reduction in total cost for '26.

Okay. That's very clear. And just a second question, if I can. As the Suncorp customers are more graded and we moved to a single customer front end. Can you just talk about any sort of pricing decisions you'll have to make? I mean if I look at Suncorp customers today, you get a slightly sharper mortgage rate and a little bit better in terms of TDs and savings. Does this move to a single front end so you need to harmonize some of those different product pricing between the ANZ and Suncorp front?

Yes. Undoubtedly, our competitive ambition is to have one face to the market, one face in terms of one product suite, one brand and to have a very simple offer to customers. Now when we say customers, we should talk about segments of customers. which means we might have a specific proposition for Segment A, don't read that the Suncorp. and then the repetition for segment B and so on and so forth. So yes, there will be inevitably a certain level of harmonization, we don't believe that it will impact at all our competitive position vis-a-vis Suncorp customers. .

Your next question comes from John Storey with UBS.

Two questions from my side. Obviously, there's a big focus on ANZ lifting revenues over the next few years. I'd be interested if you could just provide a little bit more detail just on the revenue trends that you've seen quarter-on-quarter. It looks to us like operating income is down roughly about 1.9%. Maybe a little bit more detail just on that split between NII and noninterest income, that would be useful. .

Sure. Well, we are absolutely committed and a lot of our attention is dedicated to make sure that growth is part of this journey. And that was very clear when we published the ANZ 2030 Strategy. Now I would say we want to deliver profitable growth. We are not focused on inflating our balance sheet just to show growth and hurt our shareholders and our returns. When we started this journey some months ago, we read quite well our starting point. We read quite well our business capabilities. And we were very clear on which divisions were performing well and which divisions were not performing well and which geographies were performing well and which ones were performing less well.

We also were very clear about -- we took into account our risk management perspectives and capabilities and our regulatory stance. And we read well our returns, our capital levels and our dividend outlook. We took all that into account. And I believe that we set a very clear strategy to address ANZ from a short-term and long-term perspective, right? We communicated 2 phases. In the first phase, which we , if you want, we make it tangible by always reporting on our 5 immediate priorities.

Those are foundational elements. It's important that we understand that without those elements, the company will not be able to run as fast as it can in a sustainable manner, and we are thinking long term for this company. We want the company to be in a fantastic position to run fast in a sustainable manner. And that's '26 and '27, as we said, right? Beyond '27, we expect to grow and outperform the market in a profitable manner in an accretive manner. And that's based in improving the customer experience, especially in Retail and Business Banking in improving our propositions, in strengthening materially our capacity to distribute our products, both from a digital and human perspective and to really focus on being a service bank, we are not a lender only.

We are 360 banks that want to be with customers every single day, and that's transaction banking, right? We also said that we will deliver returns improvement -- improved returns in each phase of our strategy in both phases as we are seeing. But the profile of that improvement is different from -- between Phase I and Phase II. In Phase I, the one we are now, I think you can observe significant improvements in how we are managing productivity and results are coming out of it. Cost management discipline, structured disciplined organizational design discipline significant improvements in margin management and in return management and in capital management, which means we want to generate organic capital we want to be sustainable and accretive.

We want to set the way we compete in our own merits, not on pricing only. And we want and we need to increase significantly the way we manage risk. That's all going on now silently but decisively, we are investing in order to be credible in our commitment to accelerate growth beyond '27. And that means improving customer experience, especially on the 2 divisions we said, which undoubtedly are our biggest opportunities, if you want. We are building propositions especially for the segment we announced, affluent and migrants, which will be launched in due time, even though we are already delivering some tactical improvements. We are, as we speak, replatforming our call center, improving the quality of our ATMs, launching a single customer front end, so important in 2027.

In wholesale, we continue silently to improve our digital transaction banking platforms, not only in Australia, not only in New Zealand but also in our international network. What I'm saying is, at the same time, we put the company in good order, and we set the foundations. At the same time, in parallel, we are improving our capabilities. So undoubtedly, our revenues will improve, but they have to be accretive. They have to deliver good returns. That's our ambition, and that's our commitment. And I think, to be honest, the consensus of the market is agreeing with us. That's what -- that's where the consensus is, is a company that needs to transform itself in order to grow faster. What I can assure you is that we are obsessed with that. But we will not do it without having the right foundations. It's better for shareholders to do it this way.

I can maybe add, if you like, just on the quarter-on-quarter comment, would you like me to answer that now?

Fine. I'll take it with you when we chat a bit later. I'll just ask another one just quickly on the collective provision rate on Slide 73 and 74. It looks to me like you've basically taken effectively a charge of kind of $200 million on to the economic overlays and the reweighting as you called out, a big driver of that. But if you look at actually how the model splits it out in terms of where the provision actually sits from a divisional perspective, it looks like it actually kicks a lot of it out actually into the retail and institutional divisions. I just wanted to ask, like why would you not take a more subjective view on increasing overlays possibly into the business in the Private Banking division, right?

So thanks for that. Look, I think we've -- again, I mean, this has been -- there are some overlays that we've also taken, which we haven't described in great detail. But there are on general macro uncertainty, obviously. There is no trend or any particular impacts that we're starting to see in our business and private bank, and there are also offsetting impacts because where we add some provisions, we also have had reductions to offset the increase in the scenarios as well. So there's been a bit of pluses and minuses. I'm happy to walk you through it in more detail, John, when we speak later. But it's not that we chose not to take in business at Private Bank. All divisions were impacted by the shift in scenario weights, but they were offsetting impacts, which had different outcomes for each division. .

Your next question comes from Matthew Wilson with Jarden.

Matthew Wilson, Jarden. First question, how will the pace of the business banking transformation to accelerate growth and lift returns be impacted by the current macro uncertainty that you sort of outlined given that segment is front and center of the impact, does it create opportunity? How do you avoid adverse selection and the 50% new bankers, what is that in absolute terms? And where will they come from?

Yes. important topic undoubtedly. The transformation of business, it's about building capability, right? So in that regard, the question could be, does that -- do we deviate from our initial plan vis-a-vis the cycle that we might be facing. I wouldn't think so, meaning having to build a new digital front end what we are doing, it's something that we will do it in any case, right? And we are not going to reduce the pace of our digital capabilities in business banking, be it on the small business side, which is single customer front end or as we've been saying, or building transactive -- bringing transactive Global, which is our institutional platform, into the business banking -- bigger canvas in that segment.

Those 2 platforms will continue to be upgraded. One built the other upgraded continuously. We are actually launching in the second half very important release of improvements for business banking customers from transacting global as an example. So that does not change. In terms of the bankers, and this is an important element, we need on our bankers for sales force. We need to do 3 things. We need more undoubtedly, we are underweight versus the industry for a size of our ambition. There's no doubt about it. So the 50% increase stands.

We might fine-tune it according to the cycle to your point, but stands by 2030. We need better banks, better bankers, and that means train them and skill -- making sure they have the right skills to a different level. And the launch of our banker Academy, the new banker Academy it's a reality, and we are going to start having intakes in that academy. We need to significantly have better bankers to face customer needs and the competition. And we need to equip them better with CRM tools. The fact that we, in this half, launched a new CRM platform for them with agentic AI was a big milestone.

So I would say in terms of infrastructure capabilities, no change at all. We are fully committed to improve the platforms to improve the CRM tools to improve their skills. In terms of how fast we go on the 50%, of course, the cycle might inform you if you should go faster or not. It's too soon to say. At this point in time, our appetite has not changed a bit. So we are committed to accelerate if possible, anything we can do in that segment.

That's very clear. And just one final one in your sort of opening remarks in the press release, you mentioned that there's been no material change in the overall borrowing behavior of your customers. If deterioration did materialize in the next 6 to 12 months, as is usually the case when that happens, you see a sort of rapid drawdown of facilities. Is that the sort of leading indicator that you're pointing to? If we did see pickup in system corporate credit growth due to that, then that would be telling us that things are getting a bit tougher in reality.

Undoubtedly. That's one. Okay. That's a very important indicator. when companies start to draw in their liquidity lines. That's one, undoubtedly. But to be honest, there are also other indicators that we should be looking into it, traffic on our highways, on our streets. That's a very important indicator. Discretionary consumer spending, a very important indicator. So there are some leading indicators that we are also looking into it and many others, to be honest, but that one is an important one. To be honest, so far, Yes, there are some cases, but it's still very, very shy. But again, this crisis is still at the beginning, to be honest. There are weeks. It takes some time to really unfold. Hopefully, it will not, but we can't rule out a more nasty environment, undoubtedly.

But just to add to that point as well, Matt, as we look forward, and particularly when we talk about capital, we have stressed our capital to see if there was a more elevated level of corporate borrowing, what would be the impact from a risk-weighted asset respective and capital consumption standpoint so that we can be comfortable that we can continue to accommodate the DRP as well as dividends going forward. .

Your next question comes from Andrew Triggs with JPMorgan.

First question, please. You talked quite a bit about your mortgage growth ambitions into the middle of this year. Can you touch a little bit more on both the Business Banking and Institutional division side of things? On the latter, noting that volumes were soft in the half, and it looks like that was more about the Australian division rather than currency impacts that tends to be the division which is harder to forecast in terms of loan growth. .

Sure. For -- first, I would like to remind or to highlight again what our strategic stands, okay? We see ourselves as a transaction bank, meaning we want to serve customers holistically. We want to be with them on a day-to-day basis. which means we want to be their main bank for their accounts, for their payments, for their effects, for their 360 needs, which include obviously lending, but we are not a lending-driven organization, just to be clear, we are a customer-driven organization, certainly in wholesale.

In terms of the second half and obviously not guiding too much, we would say, first, it's uncertain because the cycle is just unfolding at this point in time. But both in institutional and in business banking. On the deposit side, the behavior was good or at market. In business banking, we feel we grew in deposit side with markets. And in institutional, we feel that it was a good performance.

On the lending side, I would expect to accelerate. Now caveat the cycle. The cycle will inform us if this element I just quoted, it's possible, reasonable dual, et cetera, or desirable. But at this point in time, we think it will be better. In institutional, I want to be very clear, we don't target lending growth, okay? We remain very flexible. We target customer 360 relationships and we target flexibility, and lending is a part of that relationship. This is very, very important, from a return perspective. We want an institutional business that is profitable and is customer focused.

And just in terms of the credit quality looking forward. Obviously, you have a very strong weighting towards institutional, which is very high grade customer base. Can you just talk a little bit more about some of the, I guess, the more energy exposed sectors within that portfolio and how resilient those customers are, especially given they have, I guess, better access to capital markets and the like versus SME customers? .

Sure. I'll give you 2 or 3 data and then Farhan, you can you can add for that. Our institutional portfolio is 83% investment grade globally. Our international network, it's 91% investment grade. So it's a very robust portfolio. It's a portfolio that has been year after year for almost a decade showed extremely low loss profile. And this is not, in our opinion, a coincidence. This is a result of a decade of strategic from a lending driven business to a customer-driven business focused on introduction banking on customers that really value ANZ because of its regional presence in Asia Pacific and it's a global presence as a capital provider. So it's consistent and we don't expect to change but obviously, the cycle is here to test us. With that, Farhan, would you like to add some additional elements?

Yes. Look, I think, Andrew, I mean, I think Nuno has covered it quite well. I mean we talked about some of the statistics, and I think it's worth just repeating them. just to make sure that we are all consistent. But as Nuno said, over 90% of our international exposure is investment grade and is largely driven by high-grade corporates as well as large financial institutions and sovereign exposures. So it's a very well secured portfolio from that perspective and has shown resilience, as Nuno pointed out, over the years. 92% of all of institutional is investment grade, if you look at it from an ex markets perspective.

Our loss rate has been very low. And if you look at our -- some of the exposures that we've had, to our multiple companies, including energy. These energy companies are generally very high-grade companies who are operating in the global space and have not shown signs of stress. So of course, this is an area which we continue to watch. But given the level of coverage that we have from a provisioning point of view, in institutional as well as overall for the group and the high quality of the portfolio that we carry in institutional we feel pretty comfortable with where we are in terms of our provisioning level.

Your next question comes from Brian Johnson with MST.

And just congratulations on the cultural reset that we've seen at ANZ, there's most to be admired. Against the backdrop of that, I just had 2 questions, if I may. The first one is just on the New Zealand dollar hedge. When I over to Page 70 of the 4D, it seems to be declining. When does it basically run out? And when would you be calling out if the New Zealand dollar continues to be where it is, when would you be specifically thinking that this would cause a negative delta in the reported earnings? Is it FY '27 or is it the second half of FY '27?

Thanks, Brian. As you can see in the hedge balances that we have right now in New Zealand dollars, we have about -- just over $2.5 billion of existing hedges at about $1.10. Assuming the FX rate stays exactly where it is today, we expect to see continued benefits coming through in '27 as well. slightly less than what we've seen in '26 or what we will see in '26, but they will continue through '27, and we would expect that all things held equal, if rates don't change, then if there is any headwind that would happen closer to the second half of '28. .

So just on, just having a look at Page 70 of the release, we can see that it looks like you're actually reducing the size of that hedge like a year ago, it was 3.2% -- it was 3.1% at September '25, total hedges were 3.2%. It's now down to 2.5%. you're hedging the statutory earnings doesn't -- just the quantum of it, doesn't that actually imply that it starts to bite in the second half of '27?

We have modestly reduced New Zealand dollar hedges at these levels right now. Brian, but our estimation is that we are in good shape for the next 12 to 18 months, which should take us closer to the end of '27. And then we'll start to see some headwinds coming in '28, a function of what rates are at the time. but we expect closer to the second half of '28 for any material headwind.

And what is important to say, Brian, is that our strategy to hedge our FX exposure of dollars and U.S. dollars has not changed. So we continue to hedge. We obviously have a dynamic approach to -- depending on the levels of New Zealand dollars, but the strategy to hedge continues has not changed.

As U.S. dollars or U.S. dollars. Yes. .

Okay. The second one is that if I have a look at the slides at the back on asset quality. For example, if I have a look at Slide 83, in what I think is a pretty small text that says that you've got $1.4 billion of commercial property lending in Asia outside China. That seems to me like quite a big number. particularly given that the disruption that we're seeing in the Middle East probably has a disproportionate impact in basically Asia as a part is, for example, to Europe. When we have a look at the slide on the long-run loss rate, it seems to me that basically over the GST wasn't a big event in Australia. COVID, we had massive government intervention.

The last time we've really seen the cycle in Australia is -- but I'm just wondering, with your downside scenarios and your severe downside scenarios, can we get a little bit more granularity on when you are assuming the Middle East Gulf opens up. For example, there's reports that it may not be open until the end of August, and that's one of the more optimistic. There are ones that are much longer. Could you just give us a little bit more granularity? Because when we have a look at your ECL provisioning today, based on what we've seen from northern Westpac it looks -- that a preguided on this, it looks a little bit light relative to peers. And I just want to assess whether there's a risk when we're coming back at year-end that we see further to upstart.

There's a lot in that, Brian. So I'm going to try and see how best I can address that, and I'm happy to have a, obviously, a longer conversation later in the afternoon. But look, when we look at -- let me start first, let me just step back and look at the broader collective provision levels. As we consider that collective provision balance and the change and the shift to the downside the severe scenarios from downside by an additional 2.5%. We took a fair bit into context. We obviously wanted to -- we took a balanced view in terms of where the Middle East conflict is going to take us.

Obviously, there is no ability to forecast when exactly you will end but the shift from downside to severe of 2.5% was a reflection of the potential that this work could continue for a period of time. The second part that we considered was that we were still 52.5% weighted to the downside, which reflects the fact that we have a cautious view of the next few months as this war situation plays out. The third, of course, was the fact that we have a strong coverage, as I mentioned, even in high stress periods, I mentioned the last 1 year in the last 3 years where we've had 13 and 20x coverage on individual provision losses.

But even if you were to go back to all the way back to GFC, we -- even in the high stress years, we've had close to 5x coverage. So it has -- we've had -- our portfolio derisking has actually stood the test of time over the years. where our individual provision losses have been well and truly covered at a collective provision balance. So as we took all of those things into account, we felt that the shift and the change that we've made, which, by the way, is equivalent to the percentage shift that our peer banks have done in terms of 4 basis points of collective provision coverage is consistent, with what the others have done.

But that having been said, I think it's important, Brian, that we're not -- this is a -- obviously, this scenario will continue to play out. And we are obviously very closely monitoring how the situation evolves, and we'll continue to ensure that our provisions are appropriate in the settings based on -- and the settings are appropriate based on how the situation evolves. So I think at this point, our view, as we said earlier, even on a 100% downside scenario, as I mentioned, we have $65 million higher collective provision levels if you go to 100% downside.

And we'll continue to monitor that as well. Our portfolio quality, we've talked about the lowest loss rates for the last few years relative to our peers, very stable loss rates over the last 3 halves and a very different portfolio, if you like, relative to our peers. So it's very hard to make that peer comparison given our portfolio and given the derisking that we've done over the years.

I suppose the issue is so, Farhan, it wasn't that long ago that you used to disclose long-run loss rate, and it's less than a year ago, was 18 basis points.

Sure. And Brian, we did update that. .

It kind of disappeared now.

Well, it's not disappeared. What we've done is we basically tried to reflect the current portfolio that we have and applied the loss rate to that portfolio mix. So when we apply that -- when we apply long-run loss rates, our current portfolio mix, our -- our long run loss rate would be about 11 basis points. We're currently at 4.

Your next question comes from Carlos Cacho with Macquarie.

First, I just wanted to ask about kind of mortgage growth. You've talked about targeted growth in certain segments. Can you give us a bit more detail at where you're targeting. If I look on Slide 19, it does look like, at the moment, pretty much all your recent growth is driven by investors, and in particular, IO where from what we hear from brokers, you're well-below peers in that pricing. Is that the primary statement you're going after the investor segment, just given slightly higher margins. And so it's maybe a little bit more accretive to compete aggressively on price there?

We are going 2 segments in general. Obviously, we are targeting the whole market. but we price tactically, as we said at the beginning, to segments that we believe are more profitable when you take into account returns and risk, obviously, and that enabled us to avoid a previous stance where we were at discount for the whole market. So yes, we have been much more considerate at the time of choosing where we apply some additional, if you want, relaxation in pricing.

But in general, especially in the bigger segments, talking about the owner-occupied LTVs below 80%, we are either the second or the third among the 5, and we feel comfortable to be in that position.

And just following up on question about kind of aligning products with the Sun migration and specifically looking at potential margin impacts, at the moment, ANZ progress pay the rate that's 130 bps below the equivalent Suncorp product. If you were to align the rates on that, it wouldn't appear like it's a pretty significant margin headwind, potentially high 4 or 5 basis points. How do you think about that? Are we looking at potentially having another deposit product to avoid that margin headwind? Is that a gradual process? Or does that kick in when the Suncorp customers migrate? Just it would be good to understand how your thinking is about aligning those products where there are pretty material differences in the rates or the [indiscernible].

Sure. An important question undoubtedly. As I said, we will have, and you can -- we can talk about Suncorp if we talk about plus, we will have one set of products under one single brand, a simple set of products, but that does not mean that we have all new one products on each family. We will have several savings products and several potential TV products, obviously, and so on and so forth. So the way we are going to migrate those products into our family will have to obliged to this principle.

We don't expect to have material impact due to the fact that at this point in time, we have 3 different platforms with 2 different products because we feel that they represent different customer needs and customer profiles.

So essentially, there will be Bonus Saver products, 3 online save products once we have the new single customer front end is what it sounds like.

We will manage that accordingly. And again, customers choose the products they want, right? And we are obviously going to simplify and harmonize with time, but that does not mean that we'll have one single offer for everybody from the start.

Your next question comes from Jonathan Mott with Barrenjoey.

I just have 1 question. And sort of sitting back and thinking about the 2030 strategy since it was announced staff in September to where we are today. It's pretty clear that the costs are going really well. You're doing a great job on simplifying the business. But the one thing that's really changed has been the cash flow environment and the bond yield environment and obviously being very beneficial to industry margins and the industry revenue seeing the other bank results and updates on preannouncements coming out, it looks like it's the strongest revenue environment we've seen in a very, very long time, yet when we look at ANZ, the revenue this half was flat.

So I understand the need to get productivity, you need to get the Phase I right before we get Phase 2, and you will see the revenue benefit then. But your revenue share is really suffering through this process. So my question is if you look back and think about it, -- was that something of a mistake that you've lost out in so much revenue relative to your peers? And do you really need to use some of the higher interest rate benefit coming through to get that revenue moving again?

I think I already answered that question very clearly. So I'm not so sure if I should repeat it or not, but I will, with pleasure.

It's just the revenue environment is very different to when you made the decision and we can understand the process that you're going through. But really, the opportunity for revenue is very, very large at the moment. The longer it takes to get there is costing more money.

Yes, I couldn't agree more with you. So I'm going to repeat what I said. We have read the situation of the company 6 months ago or if you want, 12 months ago, we did a very clear review of where we were as a company. And we looked into the business capabilities we had, especially where we were laying the markets in retail and business banking. At the same time, we are making sure we take advantage of our engines that are already in good shape, talking about institutional and New Zealand.

We also read our stance in terms of risk management and our regulatory obligations. And if you recall, we were returning very close to cost of capital -- and our capital was below 12%, and there was debate about our dividend sustainability, right? So we have to face reality. -- we have to face a starting point. And then we draw a strategy, and hopefully, we executed with precision. We were absolutely clear on that strategy, right? We said -- at the beginning, deliveries will be productivity, cost management, structure, margin management, capital management, risk management, retail management I think we have been delivering on it.

In parallel, we also said that we are building the capabilities in order to be able to compete in a profitable manner. And this is very important. We are not here to right tickets to our balance sheet if they are not profitable, if they're not accretive. Shareholders don't pay us for that. Shareholders pay if we write good business profitable that allows them to share with them the benefits of that business. And that comes with time and with patients with a long-term view really thinking about shareholders and not trying to impress in the short term.

That's what we are doing with a lot of function, with a lot of discipline, but with a lot of patients. So yes, we could discount and go back to our old model of competition and get more tickets that wouldn't help shareholders. Frankly, it might not even help customers because it would distract us of the most important thing. We want to compete on our merits, better experience to customers, better propositions to customers, better channels that are able to do their job more effectively and a bank that is not a lender, a bank that is with customers every single day and do and thus fantastic service on their accounts, on their payments, on their effects, on capital-light products and also land with confidence.

That takes its own time, and we will not deviate from that. And I think that's for the best interest of shareholders, as I think it's obvious already.

Your next question comes from Richard Wiles with Morgan Stanley.

I just have one question as well. Farhan, you talked about the group margin being biased to the upside in the second half of '26. Could you talk about the outlook for margins in the Institutional division and also in New Zealand, please?

Sure. I think -- thanks, Richard, for that question. I think it is going to be slightly different outcomes for different divisions. I think that the potential beneficiary of the tailwinds that we have are probably more business and private bank. I think New Zealand, we expect would start to stabilize in the second half. Obviously, it had the impact of the significant negative -- sorry, significant rate reductions -- sorry, significant rate changes over the course of the last half, but we expect to start to see them stabilize I think institutional will remain under pressure in terms of -- in terms of the U.S. dollar rates that we talked about as well as potentially competition, both in lending and in deposits.

So we think that business banking would improve. The New Zealand business will stabilize. And I think overall, with the gives and takes, I think the retail business probably has more tailwind as well versus headwinds. So that's sort of the divisional view. But overall, from a group perspective, Richard, we expect that it will be on the upside. Now as Nuno said, there are other factors which move things around a little bit, but it's a bias to the upside.

Okay. Could I just follow up on the institutional. I think in the half just gone, the margin ex markets in institutional was broadly flat despite the headwind that you would have had from the falling U.S. dollar rates, the U.S. is on hold at the moment. I mean it's unclear what they'll do on rates. But certainly, after this week's announcement, there's -- it looks like the prospect of rate cuts has been pushed out. So given the stable margin in the last quarter, why aren't you more positive on the outlook for the institutional margin?

No, I'm always very confident of the fact that Mark and his team managed the institutional margins very well. I was just pointing out the fact that should there be any U.S. dollar rate reductions, then that would obviously put pressure on institutional margins. Of course, if that environment doesn't materialize, then we think there is a very good possibility that institutional margins remain stable, maybe slightly up. .

Your next question comes from Matt Dunger of Bank of America.

If I could ask on the institutional business delivering the vast majority of group deposit growth in the half. And you called out a strong results on operational call. It's clear you're not leading with balance sheet on the lending side. So what's happening at the customer level? Where are you winning new flows? And do you think you can sustain this momentum? .

Yes, good question. Well, undoubtedly, our performance in the -- has been for quite some time. On the transactional banking side has been, I would say, very remarkable for quite some years. And we have been growing deposits -- operational deposits at double-digit rates for some time. And that's on top of -- on one hand, our focus on that type of business. And on the consistent investment we have made on having leading platforms for payments, for FX and for markets. So there is a clear strategic rationale for these results.

On the lending side, it's fair to say that we have been cautious and we have been very mindful of returns. We also know that transaction banking and capital finance, they go hand on hand. We know that very well. So we stand very much ready to support our customers. And we are absolutely willing to put more capital into work in this segment and undoubtly. It's also fair to say the following: one of our major sources of growth in institutional has been with financial institutional customers, which, as you know, our customers that are less demanding on finance, they are much more demanding on markets business and then on transactional banking.

The fact that we have been growing a lot in financial institutions allow us to be less dependent on capital deployment, that this is also a strategic direction that we took. So on one hand, the type of customers we have been banking are more capital light, and we have been growing and on the other hand, we are return conscious. But above all, we are absolutely, absolutely ready to deploy more capital, certainly now that our capital levels are at a healthy level in this segment, we want to. But what we will not do it's to go into a capital deployment pre just to, if you want to show up in our balance sheet, that has limited value, as I think we know.

Could I just follow up with the franking rising to 75%, your lending growth has been targeted towards Australia. So just wondering how important it is to sustain this obviously raising the franking positive for your retail shareholder base.

I can't talk about that and then Farhan if you want to add something. But our strategy, as we as we announced it 6 months ago, our strategy is naturally frankly accretive, right? Remember, we clearly said we have 2 divisions that are performing well institution in New Zealand. Those divisions, well, one is New Zealand is outside, obviously, of Australia. And in institutional, there is a part outside of Australia. And then we sell our biggest opportunity, our biggest gap in terms of capabilities and obviously, in terms of results is retail Australia, business Banking Australia. So as we close the gap in these 2 business, which is, again, fair to say, initial phase, more on the productivity side, second phase, more on the revenue side.

Those 2 businesses will become more important on the mix of business of ANZ, which is accretive to franking. So this is to say this 70% to 75%, we expect to absolutely be sustainable. And obviously, we -- this is in the best interest of shareholders. If you want when we announced an $0.83 dividend, and we upgrade franking from 70 to 75, that actually equates to a $0.02 increase on the net dividend for those type of shareholders. Farhan, do you want to?

Yes. I think you've covered it really well. I would just say, as you know well, Matt, that Obviously, our franking is an outcome of our strategy, not the other way around. And as Nuno said, our strategy is very frankly and accretive by definition because it is very much focused on the Australian geography. In fact, our entire 2030 strategy is predicated on the fact that not only will we continue to extend the lead in our businesses in New Zealand and institutional, but we will have a substantial uplift in our businesses in Australia, retail and Australia business and private bank.

So therefore, we obviously are expecting to see franking to continue to increase, as I said, is in line with our strategy. The other point, which we've said before several times, as you know well, is that we have no incentive to keep any franking benefits. On our balance sheet. Our intention is to try and distribute as much of the franking as possible because it doesn't benefit us, but it is a significant benefit in the hands of our shareholders. And we want to make sure that we continue to enhance that value for them as we go forward.

Your next question comes from Brendan Sproules with Goldman Sachs.

Brendan from Goldman Sachs. Just want to follow on, on Slide 54 around the revenue momentum within the institutional division. Obviously, over the last half you've had pretty flat revenue growth from a customer franchise particularly in the non-lending space, despite the fact or operational deposits are kind of up 20%, I think, since September 2024. To what extent is rate rise is important to really get the revenue growing in this business, particularly now that you're not as focused on lending as you may have been in the past? And then I have a second question.

Thanks, Brendan. So obviously, for a transactional banking business, not surprisingly, the rate levels are important. That's very clear. And it is what it is. Having said that, this is a very capital-light business and the fact that we have been growing volumes at a very good pace, above markets. It means that the sustainability of that flow at capital-light flow is very strong, right? And it's on top of great capabilities. On the lending side, we don't target lending intuitional, but again, it's very much part of our offer. We just don't deploy capital without a clear rationale for deploying capital, right?

And it's within a customer relationship, which means it's within a symmetrical and mutual benefit relationship with our customers. And I believe the fact that we are by far are the leading institutional bank in Australia and New Zealand tells you that customers really value the way we serve them, and we operate with them. So yes, rates are important. -- take into account that our replicating portfolio takes a lot of that volatility. So the same way we were hurt when rates start to go down in the last half. It's fair to say that we will benefit going forward. But to move all what we are looking in this business its sustainability in a capital life business, and that's one of the ways to make sure that an institutional business is profitable, right?

And it's profitable in a sustained manner and is not dependent so much on cycles of credit, on credit spreads, on credit demand and potential losses. So we are much more comfortable in being the bank of the day-to-day of companies in a 360 manner, even though, as you said, we will have some fluctuation on rates, but I prefer a fluctuation on rates in a capital-light business than a fluctuation on credit cycles, to be honest.

If I can just add one other point because Nuno is absolutely right. These businesses are, by definition, leverage with the upside on rate. But there is the other element of the fact that Nuno mentioned volumes. But we also very carefully manage and monitor the cost per dollar of in this business because effectively, at the end of the day, we're seeing returns. And those returns from the cash measurement business drive a number of things. They drive what the cost of dollar per fonis, even if rates aren't going up, we monitor volume, obviously. But also, it is a very important feeder product or very much of an integral product to the broader businesses that clients do, whether it's on trade, whether it's on markets flow business, including FX, et cetera, which are intricately linked to payments and cash management.

So it's -- it is a very central part of the ecosystem of what we do with our customers, which is the point that Nuno has made around transaction banking and services being center of plate for our customers. in institutional. So it has a number of other value drivers, which don't necessarily always show up in just fees and commission, for example.

Maybe if I could just follow on from that. I'm just trying to sort of understand where institutional sits in the longer term 2030 vision, obviously, a 13% return on tangible equities, your group target Currently, institutional is your largest contributor from a revenue perspective. It's 30% and its return on tangible equity is 14%. It's been pretty constant. Just given what you outlined there, am I imagining that this will still be your biggest contributing division when you get to 2030 and because of the capital light nature of how you want to run this business, that we can expect that return on tangible equity to grow and be a major contributor to the group's overall target of 13%?

Yes. Important matter, which is the mix of business and how the mix of business will evolve with the strategy. As you know, we didn't guide on mix of business in that regard. Having said that, what I think it's disclosable is the fact that institutional is a business where we are a leader right? We are a leader in Australia, in New Zealand, and we are a highly competitive franchise, especially in Asia Pacific. Leadership has a benefit. It always -- you always over-index in returns when you are the leader, right?

So this is a jewel we have. It's a significant part of our business. We want to make sure that, that business continues to be the leader. In that regard, you should not expect a significant reduction of the mix -- in the mix of ANZ in institutional. Also in that regard, we want to make sure that institutional remains a very profitable part of our franchise. We don't want to, again, depend on credit. But -- and this is an important element for the cycle. The fact that we have good levels of capital in a cycle where credit spreads potentially will improve. We stand ready to benefit from the improvement of credit spreads because, again, we are a capital finance provider. So institution will remain very important. We'll remain a leader in the market we just mentioned. It will continue to be a capital-light business. We don't expect degradation of returns, but there will be obviously cycles. I think with that, you have an idea where we want to stay with this business by 2030.

There are no further questions at this time. I'll now hand back for any closing remarks.

All right. Thank you, Darcy, and thank you, everyone, for joining us today. Before we wrap up, I would like to reiterate our 3 key messages. First, our transformation is running at pace, and we are making good progress in executing our 5 immediate priorities safely, sustainably and on time. Second, in parallel, we are investing in line with our ANZ 2030 strategic initiatives to deliver to our customers to accelerate growth and to outperform the market beyond '27. And very important, we are already delivering materially better returns for shareholders. I look forward to consistently updating you on our progress. Thank you so much.

Good morning, ladies and gentlemen. My name is Clare Morgan, and I am the Group Executive for Business and Private Banking and a member of the Group Executive Committee here at ANZ. I will act as a moderator for today's Annual General Meeting.

We pause to acknowledge the tragic events in Bondi earlier this week and extend our heartfelt thoughts to those impacted as we come together for today's meeting. Our deepest sympathies are with the victims, their families and the wider community as we all navigate the aftermath of this deeply distressing event.

Before the meeting starts, the Chairman has asked me to run through some administrative matters, particularly in relation to voting and asking questions. Today's meeting is an in-person AGM and shareholders and proxy holders in the room have been given a white voting card with a QR code and a poll will be held on each of the resolutions.

To assist with the poll, the Chairman has appointed Mr. Michael Hutchison of Computershare to act as returning officer and KPMG to act as scrutineers. For those with smartphones, when the Chairman opens the poll, please scan the QR code with your devices camera. This will open an online voting page in your browser, accept the terms and conditions, then press the Vote icon and all resolutions will be activated with voting options.

To cast your vote, simply select for, against or abstain. There is no need to hit a submit or enter button as the vote is automatically recorded. You will receive a vote confirmation notification on your screen. Of course, you can change your mind or cancel your vote at any time before the poll is closed. The Chairman will announce when that is about to happen. For those without smartphones, once the Chairman has opened the poll, please complete and sign the voting card provided to you and provide it to a Computershare representative as you leave the room.

As mentioned earlier, this is an in-person meeting. It is also being broadcast online, and we will allow online questions from shareholders and their representatives. After the formal presentations, the Chairman will hold a general question-and-answer session and then question-and-answer sessions on the formal resolutions that I put to the meeting.

As such, I'll now run through the technical process for asking questions or making comments. As is our usual practice, we invited shareholders to send in questions prior to the meeting. The key themes arising from those questions will be addressed in the opening statements from the Chairman and the CEO. We'll be taking questions from both the floor of the meeting and online via our meeting platform.

I'll now cover how to ask questions or make comments online. The Chairman will specify the order in which questions and comments may be asked and will group them by relevant resolutions. [Operator Instructions] Questions and comments received from shareholders online will be read out by me as moderator.

Where we receive questions or comments online that are repetitive, I may read out one, a representative selection or a summary of the questions for the Chairman to address. If they are overly long, a summary may be read out. In the case of multiple questions on the same topic that have already been responded to, the Chairman will advise that those questions have already been adequately answered and move on. As you know, only shareholders and their representatives can ask questions at the meeting in person, those with a white or green registration card today. We may not be able to answer every question or address every comment received.

To give as many shareholders as possible the opportunity to participate, we ask those submitting questions online or in person to limit their questions or comments to 2 per item of business, and your questions or comments to be concise.

We also had the lead Audit Partner, Maria Trinci, from our external auditors, KPMG, available to address any questions shareholders may have on the conduct of the audit or auditors' report on the financial statements.

This being a meeting of shareholders, it's important to note we cannot comment on specific customer matters, including our customers' business activities or any matters subject to legal or other dispute. As such, questions or comments of that nature will not be put to the meeting or answered. For those here in person, we do have members of staff at a booth outside of this room who can assist with such matters. We will also not allow any questions or comments that are abusive, obscene or defamatory in nature. Questions received online may be moderated for inappropriate language.

Any technical issues with the broadcast or the online platform will not affect proceedings here, but we will try and resolve any issues as soon as possible. If you are having connectivity issues, the online meeting guide and frequently asked questions document available at anz.com/agm outlines what to do.

For those in the room, should there be an emergency or disruption, where possible, we will temporarily suspend proceedings and resume as soon as possible. If that is not possible, the Chairman will suspend proceedings till later in the day.

I would now like to introduce Kaylee Hipwell for an acknowledgment of country. Over to you, Kaylee.

[Foreign Language] Good day, everyone. My name is Kaylee Hipwell and I am a proud Wiradjuri woman from Central New South Wales, living on Dharawal country in South West Sydney. I began my journey with ANZ 17 years ago as a school-based indigenous trainee and now work within ANZ's First Nation's Talent and Culture team, having the opportunity to contribute to creating employment pathways for MOB and supporting ANZ's cultural intelligence pillar within our First Nation strategy.

Today, I have the privilege of joining you all to acknowledge and pay respect to the traditional owners of the land on which we gather today. the Gadigal people of the Eora Nation, a place where the harbor itself has long been a source of knowledge, culture and exchange. For thousands of generations, shell work and the harvesting of shells held deep value, not as currency in a Western sense, but as cultural wealth embedded in relationships, ceremony and trade. I pay my respect to elders past, present and emerging for they hold the memories, traditions and hopes of First Nations' people.

We celebrate the diversity of Aboriginal and Torres Strait Islander people across Australia and recognize our enduring connection to culture, country and community, a connection that has never been broken despite the challenges of history. I would like to extend this acknowledgment and pay respect to the traditional owners of the lands from which our virtual participants are joining.

Finally, I want to recognize and pay respect to any of my First Nations' brothers and sisters here in the room or joining online. Your voices and contributions to ANZ are very important and together, we carry the voice, strength and resilience of our people, [Foreign Language]. Thank you.

I will now hand over to our Chairman, Paul O'Sullivan.

Good morning, ladies and gentlemen, and thank you, Kaylee, for such a heartfelt acknowledgment of country and how proud we are to have employees like Kaylee working with us. I too acknowledge the Gadigal people of the Eora Nation as the traditional custodians of the land on which we are meeting today. We respect their spiritual relationship with this country and we pay respect to their elders, past and present. And I also extend that respect to other Aboriginal and Torres Strait Islander people joining the meeting today.

As Kaylee said, my name is Paul O'Sullivan. I am the Chairman of ANZ, and I have the privilege of welcoming you to the 2025 Annual General Meeting of ANZ Group Holdings Limited. Our directors, who include our new Chief Executive, Nuno Matos are here; and Graham Hodges, who's recovering from surgery, but who couldn't be here today, is listening via the webcast, and they join me in welcoming you to this meeting.

On behalf of the Board, I want to start by offering our sincere condolences to all those impacted by the tragic events of last Sunday, particularly the Jewish community in Sydney and across Australia. It was an act of pure terrorism. And I know everyone here is deeply distressed by what occurred. And let me be clear, antisemitism has no place in our society. And as a community, we must do all we can to stamp out antisemitism and all forms of hate, intolerance and division.

There being a quorum present, I now formally declare the meeting open. The notice of the Annual General Meeting has been made available to shareholders, and I will take it as read. This year, we disclosed via the ASX, a summary of proxies on all resolutions received before the meeting, and they are now on screen.

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Indeed, indeed, I may have a spare pair in my bag, I don't know whether that will be of help. They're also available via the ASX website. I confirm that I'm holding available undirected proxies in my capacity as Chair of the meeting. And as disclosed in the Notice of Meeting, I will vote all available proxies in favor of the resolutions in items 2, 3 and 4 and against the resolutions in items 5, 6, 7, 8 and 9.

Now items 7, 8 and 9 are conditional. They're conditional on item 5 being passed by the requisite special majority and based on the proxy instructions received in advance of the meeting and after allowing for the number of votes in the room today, it is clear that item 5 will not pass. Therefore, I will not be putting the resolutions in items 7, 8 and 9 to the meeting. There will, however, be an opportunity for shareholders to ask questions on those items during the Q&A sessions.

As can be seen from the screen and after allowing for the votes that are available in the room, I can confirm that it is clear that more than 25% of the votes to be cast on that item will be against the adoption of the remuneration report. As such, the conditional item 6 will be put to the meeting, but I can also confirm that it is clear in the light of proxy instructions received that item 6 will be rejected by shareholders. If I look at the proxies, there's a 1.45% vote for that resolution.

I will address those items in my speech and more detail on remuneration matters will be provided by the Chair of the People and Culture Committee, Holly Kramer, later in the meeting. I therefore now open the poll for items 2 to 6 being considered at today's meeting. And those in the room may now start casting your votes. I'll also give you a warning before the poll closes at the end of the meeting to ensure you have sufficient time to vote.

Turning to the business of the meeting. The most visible change you can see since our last AGM is that this year, we've welcomed Nuno as our new Chief Executive Officer. He joined us in May this year. Nuno joined ANZ after a 30-year distinguished global banking career, and we are certainly as Directors very pleased to have him on board.

Most recently, he was the global Chief Executive Officer for Wealth and Personal Banking at HSBC, serving approximately 40 million customers across 35 markets. And before that, he held senior roles at Santander in retail and institutional banking across many different countries. Importantly, Nuno has a track record of leading successful bank transformations, driving accountability as well as delivering significant improvements in the management of nonfinancial risk. And despite only being with ANZ for a short time, Nuno has made an immediate impact, most notably invisible to you with the introduction of our refreshed ANZ 2030 Strategy and the appointment of 4 new but very experienced leaders from around the world to join our executive committee.

I think it's important to say that in selecting the new leadership for the bank, your Board has been focused on us appointing group executives with a track record of successful delivery in their area of expertise, and I'll briefly introduce and mention who they are. First, Stephen White, who joined in October as our new Chief Operations Officer with extensive experience from the U.K. as well as Australia; Pedro Rodeia, who's our new Group Executive Retail; Donald Patra, who's our new Group Chief Information Officer; and Christine Palmer, who joined us as our new Group Chief Risk Officer. And combining this new strong experienced talent with our existing strong leaders: Farhan Faruqui is beside me here on the stage, our group CFO; Mark Whelan, who very successfully leads the Institutional Bank; Antonia Watson, the CEO of ANZ in New Zealand; Clare Morgan, who you just heard from, who heads the Business and Private Banking; and Elisa Clements, who leads Talent and Culture.

We believe ANZ's executive team has the right combination, the right mix of global and local talent to help us realize our ambitions, build the right culture and significantly improve the management of your bank.

While our new CEO and Exco members are the most visible sign of the renewal, your Board has been focused on lifting the performance of the bank over many years. In recent years, the Board commissioned independent expert reviews on behalf of the Board into both our nonfinancial risk program and the rollout of ANZ Plus, reviews which have led to major improvements into how we are delivering these important programs.

Looking first at nonfinancial risk, making sustainable and material progress is not just a priority for the bank, it is a core commitment for everyone at ANZ. In fact, when the Board appointed Nuno, we did it with an eye to this critical area, this critical piece of work. And the Board has given Nuno a clear mandate as CEO to drive the fundamental reform ANZ needs.

In addition, the Board agreed to an undertaking with APRA this year to drive a company-wide uplift in nonfinancial risk following the gaps that were identified during investigations into our Australian Markets business.

Under our new CEO's leadership, we have expanded this undertaking into a much wider bank-wide transformation, which we call PACT, P-A-C-T, stands for people, accountability, customers and trust. And it's all about delivering a stronger, more competitive ANZ.

Importantly, and associated with this, we also reached a settlement with ASIC this year on a range of outstanding matters and your Board is acutely aware that this agreement included a significant financial penalty that impacted shareholders. However, on balance, we felt it was the right decision for all our stakeholders.

On ANZ Plus, while our review confirmed the technology platforms are indeed correct, it did recommend changes in how we develop them. And indeed, Nuno has built on this and driven a major change in this program that reflects those findings.

Under our refreshed ANZ 2030 Strategy, which Nuno will outline in greater detail, we have commenced a major restructuring of the bank to make it a simpler and more effective bank, better at serving our customers.

I do want to say, and this is a very important point, the Board recognizes that the organizational restructure being undertaken by the bank is challenging. It's challenging for all our employees and especially for those directly affected by job losses. Sadly, these changes are necessary to ensure that we remain a strong and viable business. But I can say very clearly, on behalf of all my colleagues, no one can undertake a transformation like this without a deep sense of empathy and concern for all those impacted. And we are focused on supporting those impacted individuals with the necessary resources to transition to new employment and providing appropriate financial support.

Turning to our operating performance. This was a challenging year with our full year statutory profit down 10% on the prior year. This was largely due to the actions I've described, which we took to address a range of customer and regulatory matters as well as the steps to restructure our business. Adjusting for these significant items, our cash profit would have been flat at $6.9 billion. We will distribute tomorrow a final dividend per share of $0.83, franked at 70%, bringing the full year dividend to $1.66 per share and that strong dividend performance reflects our confidence in the bank's strategy.

From a divisional perspective, New Zealand performed very well and remains the leading bank in New Zealand. Our institutional bank continued to benefit from the transformation undertaken over recent years, and it remains the leading institutional franchise in Australia and New Zealand and is externally ranked as one of the best institutional banks in our region.

Suncorp Bank, which we acquired in 2024, continues to achieve strong financial and customer outcomes. And as announced by Nuno this year, we expect to deliver significant synergies from the purchase in the coming years.

In Australia, retail and business -- sorry, in Australia Retail and also in Business and Private Banking, despite solid asset and deposit growth, our view is that these businesses are not yet where we want them to be and where they can be. Driving material improvements in these 2 businesses is a major focus of our refreshed strategy, ANZ 2030.

And of course, in addition to appointing a new CEO with the right skills to drive the bank forward, your Board itself has also been through a period of renewal in recent years. In fact, of my colleagues up here today, 6 of the 9 joint group and bank board directors before you today have only been in place since 2023. And in terms of the Board, this evolution is ongoing. And if I am privileged to be elected for a final term today, I will be focused on ensuring we continue to have the right directors with the right mix of skills and experience to take us forward, including as this is going to be my final term if reelected, the appointment of my successor.

Today, we will also invite a vote on the reelection -- on the election and reelection of 2 Board members. In May, we were pleased to welcome the very experienced company Director, Alison Gerry to the ANZ Group and Bank Boards. Alison was previously a Director of ANZ Bank in New Zealand and she brings extensive experience in the financial services and infrastructure sector. And that includes in her role as a Non-Executive Director of Air New Zealand and the Chair of Infratil Limited. Alison has already made a valuable contribution on behalf of shareholders, and she will be addressing the meeting shortly.

Jeff Smith, who brings extensive technology knowledge to the Board and financial services is increasingly all about technology. Jeff will be seeking reelection today, and you will be hearing from him shortly too.

Finally, it's appropriate I give you the perspective from the Chair and the Board on the resolutions being voted on today and the adoption of the remuneration report.

The Board takes our responsibility for executive remuneration very seriously. And in this year's remuneration report, you will note that none of our Australia-based group executives, excluding 2 in acting roles, received short-term variable remuneration or incentives. Importantly, our new CEO also proposed to the Board that he should not receive short-term variable remuneration this year, even though the factors contributing to our decisions predated his arrival. I think this decision reflects very clearly, Nuno's commitment to lead by example and to embed from the top down a culture of accountability, and I applaud him for that.

While the Chair of the People and Culture Committee, Holly Kramer, will cover this in more detail, I think it is important to say that the Board's response this year has been appropriate and proportionate given the challenges ANZ faced. I would also point out that the outcomes regarding unvested equity for some of our former executives have been and will continue to be made as those decisions fall due.

And I want to be really clear on this, the Board can and the Board will make future adjustments to remuneration where appropriate. This methodical assessment over an extended period over several years is consistent with the intent of the law as expressed in regulation following the Royal Commission, deferring incentive payments over many years, ensures accountability and alignment over time. And I would also point out that there have been earlier adjustments to executive remuneration, including in 2022 to reflect issues in nonfinancial risk and ANZ Plus in 2024.

As I said, our remuneration report will receive a strike today despite the strong steps taken by the Board to enforce accountability. But it is worth noting that while a significant minority of shareholders have voted against the remuneration report, including many who told us that we didn't go far enough, on the other hand, we are currently facing litigation from a former executive on this matter. And I want to say very clearly, the Board is very confident in our decision-making and ANZ will defend this court action vigorously.

The other resolution I want to specifically address, and I know this is of interest to many shareholders relates to climate change and our lending to the energy sector. As we have made clear over many years, our commitment is to be a leading bank in supporting an effective and orderly transition for our business customers in line with the targets set by the Paris Agreement. And that's why we were the first Australian bank to formally engage with 100 of our largest carbon-emitting business customers on their transition plans and very importantly, to ask them to disclose their progress. These are actions which have since been followed by our domestic and global banking peers. And what ANZ firmly believes that climate change is a risk that needs to be managed now, the Board does not consider the amendments in the constitution outlined in item 5, along with the resolutions in items 7, 8 and 9 to be in shareholders' best interests.

In relation to the items addressing potential deforestation risk, our position is very clear. We expect our customers to exercise appropriate land management in accordance with regulation and best practice and very importantly to also take steps that avoid or reduce negative impacts.

We consider it is premature to consider adopting a deforestation standard to decide which customers to finance, noting that there are significant gaps in the available data on nature-related issues and an often complex regulatory environment faced by our customers. But the commitment we will make is that we will continue to strengthen our due diligence processes, review our exposure and engage with customers to highlight our expectations on how they address nature risk.

For all our large-emitting customers, carbon-emitting customers, we expect our public targets and strategy to be aligned with the Paris goal of limiting global temperature increases to well below 2 degrees and to strive for 1.5. And in terms of that, we also expect that at a very least to demonstrate progress towards that objective.

We firmly believe that as a bank, we can have the most positive impact for the community, by working with our customers to help reduce their emissions, not by withdrawing finance prematurely and potentially forcing them to borrow from lenders who have lower or no carbon emission standards, and we witnessed an event like that in recent years.

In closing, let me finish by acknowledging the more than 40,000 people who come to work at ANZ every day across 29 markets internationally. This is Australia's biggest global bank. It has been a big year of change, and we appreciate the hard work and dedication of all our people. I'd also like to thank our customers for again trusting us with their business as well as you, our shareholders, for supporting us. Your continued support and your presence here today is much appreciated.

I'll now invite our new Chief Executive, Nuno Matos, to say a few words. Welcome, Nuno.

Good morning, everyone, and welcome. I too would like to acknowledge the Gadigal people of the Eora Nation as the traditional owners of the lands on which we meet today. I pay my respect to elders past and present and extend that respect to other Aboriginal and Torres Strait Islander people joining us today.

Before we begin, I also would like to acknowledge Sunday's devastating terrorist attack at Bondi Beach, not far from where we are meeting today. On behalf of everyone at ANZ, our hearts go out to those who have been impacted, particularly our friends and colleagues in the Jewish community and across Sydney. Hate and violence have no place in our community and our thoughts are with the victims, their families and friends and everyone affected.

Now turning to the business of the day. It was a privilege to join ANZ in May this year as CEO of a bank with a rich 197-year history. Likewise, it was a privilege to be here in Sydney today addressing my first Annual General Meeting for the bank.

Since joining, I have met with many of you, our shareholders as well as our customers, employees and other key stakeholders, and I appreciate your feedback and insights. I spent time in our key markets across Australia, New Zealand, Hong Kong, India, the U.K. and Singapore, while carrying out an extensive strategic review across the bank.

During the year, we took important steps to help clear the path for our future where we will deliver a stronger bank that is focused on our customers and on delivering value. This included a settlement with ASIC to resolve regulatory matters as well as organizational changes to simplify our bank.

As the Chairman noted, our full year statutory profit was down 10%, largely due to the impact of significant items as a result of these actions. Excluding those items, cash profit was flat from the prior year at $6.9 billion, and our cash return on tangible equity was down slightly to 10.5%.

Our balance sheet and capital position remained strong with common equity Tier 1 at 12.03% at the end of September, having improved 25 basis points in the second half. The results demonstrate that while our franchise is strong, action is needed.

Our refreshed ANZ 2030 Strategy, unveiled in October, lays out a clear plan to materially improve the performance of our Australian Retail and Business and Private Banking divisions, while extending our leadership in Institutional and New Zealand. At the heart of this strategy, it's our ambition to unlock ANZ's potential to win the preference of customers, shareholders and other stakeholders.

ANZ 2030 is focused on 4 strategic pillars. Number one, customer first, with market-leading differentiated and superior propositions, we will raise the standard of every digital and human interactions with our customers. Number two, simplicity. To set the market standard for productivity, we will deliver organizational simplification, divest non-core assets and improve efficiency. Number three, resilience. Leading the industry in trust, safety and risk management, we will adhere to the highest standards of nonfinancial risk management and strengthen end-to-end accountability across the bank. And as a consequence, number four, delivering value. To sustainably improve our financial performance, we will create lasting value by delivering higher returning growth and results that matter for our stakeholders.

In delivering these priorities, we are supported by our 4 core enablers -- by our core enablers, sorry, our culture, our people and our technology. Our strategy will be delivered in 2 clear phases. The first phase, across FY '26 and FY '27, it's about delivering on our immediate priorities in order to get the basics right, including a substantial improvement in productivity and initial investment for growth.

In the second phase, beyond FY '27, we will realize the benefits of the strong foundations, accelerate growth and outperform the market. Our most immediate priority has been to ensure we have the right leadership team in place to execute our strategy and build the right culture.

As the Chairman noted, 4 new members have joined my executive committee. Together, we are building a culture of clarity, decisiveness, self-awareness, execution and accountability while fostering an engaged workforce motivated to execute on our strategy.

We are on track for our second priority, which is bringing forward the integration of Suncorp Bank to accelerate value creation to our -- for our shareholders, benefit our customers and significantly reduce operational complexity. We will complete a safe and secure migration of Suncorp Bank customers to ANZ by June 2027 and this work is already underway.

Our third priority is also on track to accelerate the delivery of the ANZ Plus digital front-end to all of our 8 million retail and SME banking customers by September 2027.

We have made significant progress on our fourth priority, simplifying the bank and reducing duplication. This includes stopping initiatives that are not aligned with our strategy and prioritizing what we will make the most difference for our customers. Uplifting our nonfinancial risk management, it's also a key priority, but both now and into the future. A significant amount of work is already underway to support the business and culture transformation, which delivers a better run bank for our customers.

I recognize that as a CEO, I am ultimately accountable for making sure we get this right. As I mentioned earlier, a key pillar for our ANZ 2030 Strategy is to put our customers first. I am well aware that many CEOs say their companies are customer focused. But stating this versus truly living and delivering on it are 2 very different things.

Despite our good intentions, we have not consistently lived up to the expectations of our customers across all of our businesses. I want to stress to you today that we are going to get back to growth by getting back to basics and relentlessly focusing on customers across every segment and business of ANZ.

This is not about the headline on the slide but rather a mindset we are going to drive throughout the organization. We will increase bankers in both Australia Retail and Business & Private Banking by up to 50% over the next 5 years while giving them much better tools.

We will also sharpen our focus on customer service. This will be supported by our recent launch of Bank@Post, providing ANZ customer access to banking services at more than 3,300 participating Australia Post offices nationwide.

Helping customers through tough times is also critical as cost of living pressures continue despite a cyclical reduction in inflation in the past year.

At the end of September, approximately 4 in every 1,000 Australian ANZ home loan customers and approximately 2 in every 1,000 Australian ANZ small business customers were receiving hardship assistance. Importantly, over 68% of customers who enter hardship have either paid out their facility in full or are up-to-date on their repayments within 12 months.

We also remain firmly committed to helping keep customers safe from scams and fraud. In 2025, our people and systems prevented and recovered more than $220 million in scam and fraud-related funds across Australia and New Zealand. Throughout the year, we continued to support the communities in which we operate. In Australia, this included the launch of our First Nations strategy, committed to advancing economic self-determination over the next decade.

We also continue to build our financial education and matched savings program, Saver Plus, which is the largest program of its kind in the world. Funded by ANZ and the Australian government, Saver Plus is delivered in partnership with Berry Street Yooralla, Brotherhood of St Laurence and The Smith Family.

More than 4,000 people participated in Saver Plus this year, totaling more than 66,000 since the program started in 2003 who have received around $28 million in matched savings from ANZ for education costs. Our financial education program, MoneyMinded, also continued to grow, helping more adults on lower incomes build their financial skills, knowledge and confidence.

Looking back on 2025, I view this as a period of significant but necessary change for the bank, which lays strong foundations for growth. As we look ahead to 2026, I would like to remind you of our 3 key strengths. First, our franchise has a strong competitive position. We have 2 scale markets, Australia and New Zealand, and 2 market-leading positions in our Institutional and New Zealand businesses. We also have a well-diversified business benefiting from our strong presence in the fastest growing economic region in the world, Asia.

Second, we have a significant opportunity, indeed obligation, to improve our performance in Australia Retail and Business Banking. In Institutional and New Zealand, we are focused on extending our current leadership.

And third, we have the right strategy, ANZ 2030, to unlock and deliver value from those opportunities. I would like to thank our customers for trusting us this year with their banking needs and our employees for helping drive the change needed to support our strategy. And of course, I thank you, our shareholders, for your support and for joining us today.

I will now hand back to Chairman.

Thank you, Nuno. So we now come to the formal resolutions and the Q&A section of the meeting. Questions can now be submitted online, and we've addressed the group's results in the earlier speeches. And as there is no formal resolution to be passed in relation to the group's 2025 Annual Report, items 5, 7, 8, 9 are external proposals, which I have addressed earlier in my formal speech.

While item 5 has failed to pass and the other items will not be put at the meeting, I will, however, ask Kyle Robertson from Market Forces and Jolene George from the Australian Conservation Foundation to now come to the microphone to briefly address those items. So welcome to you.

So Kyle, are you going to lead off?

I believe I will.

You will, okay, okay. Over to you.

Paul O'Sullivan, I'm over here. It's a big room. Good morning, Mr. O'Sullivan, Mr. Matos, members of the Board and to those in the room and online today.

Thank you for the opportunity to speak to the shareholder resolutions on deforestation on behalf of the co-filers -- co-filing shareholders. In the interest of time, I'll aim to be brief. The International Monetary Fund, the World Bank and a number of central bankers have recognized that our economy is embedded in nature. Healthy ecosystems and biodiversity fundamentally underpin our economy.

While nearly half of our economic output in Australia is directly dependent on nature, there is not a single dollar that does not depend somewhere along its value chain on nature. The unprecedented and rapid decline of nature should be a concern for all of us.

Deforestation represents one of the most damaging forms of nature destruction. The destructions of forest here in Australia is one of the primary drivers of biodiversity decline, and it is a source of both short- and long-term risk for the bank. ANZ's engagement with large business customers, increasingly reflects its focus on nature-related risks, including deforestation.

We've appreciated the constructive engagement with members of the ANZ team over the past year and understand that the bank is conscious of its exposure to deforestation via its lending. However, remains at a much earlier stage than peers in translating this awareness into a broader understanding and action.

ANZ's root cause analysis identified opportunities to strengthen nonfinancial risk management, including through greater openness to benchmarking and peer insights as opportunities to learn and improve. While the risks posed by deforestation are both financial and nonfinancial, addressing deforestation presents an opportunity for ANZ to demonstrate leadership by learning from peers and adopting emerging best practice.

To directly address resolution 7 and 8 before shareholders today. Resolution 7 asked the bank to assess and disclose within a reasonable time frame and omitting proprietary information, the bank's exposure to deforestation through financing to the agricultural sector.

In responding to the resolutions before us today, ANZ has acknowledged that it must build capabilities to understand its exposure to nature-related risks. This is a positive and crucial first step. Resolution 7 does not require the bank to do anything more than disclose this information in a form and time frame determined by management.

Without understanding how and where the bank is exposed to deforestation, policies and procedures to manage the reputational compliance, default and credit risks that can arise from deforestation cannot be effective. For example, focusing on institutional customers, as ANZ has signaled in its Notice of Meeting, without having assessed and disclosed where in the bank, be it institutional, commercial or retail ANZ is most exposed to this issue, risk misdirecting efforts and leaving material exposure unmanaged.

Particularly as our research has indicated, it is not most frequently the largest customers who are at the highest risk of undertaking deforestation. Shareholders need clear assurance the bank has undertaken this analysis and is acting on it.

Resolution 8 asked the bank to disclose the strategy to eliminate finance deforestation in line with credible frameworks and market expectations. Like Resolution 7, the resolution is not prescriptive but seeks disclosure of a strategy to address material nature risk.

Increasingly, markets, governments and the broader community are moving away from deforestation-linked commodities. The resolution is seeking to understand how the bank intends to proactively address this inevitable shift and the material risks that arise from it.

We thank shareholders who have already voted for their strong support on these resolutions and encourage those who have not yet voted to support both resolutions. Thank you very much.

Thank you, Jolene. Thank you for that. And have we got Kyle, who's going to say a few words? Yes, we have.

Thank you, Chair and the Board, and greetings to shareholders present in this room and online. I'm speaking on the resolution at item 9, customer transition plan approach and climate commitments. ANZ has a long-standing commitment of support for the Paris Agreement's goal of transitioning to net zero emissions by 2050 and a commitment to playing its part.

Dating back to 2020, ANZ has stated that it was committed to improving transparency to show how its financing decisions are supporting the achievement of the Paris Agreement's goals. Dating back to 2021, ANZ clarified expectations for fossil fuel customers to establish specific, time-bound, public transition plans and diversification strategies by 2025, further clarifying later that it expected such plans to be Paris aligned.

ANZ has now given its fossil fuel clients 4 years to produce clear and credible transition plans and also given itself 4 years to drive improvements in its client strategies. Yet in 2025, ANZ's disclosures still do not provide clarity on how it is ensuring that its financing decisions are supporting the achievement of the Paris Agreement goals. Its latest climate report states that the bank may reduce support for companies rated in its lowest transition plan ranking category, those classified as emerging.

By ANZ's own definition, companies in this category have not progressed beyond acknowledging the need to develop a transition plan at some point in the future, while simply recognizing that climate change is a significant issue. A company like this would have no public targets to reduce emissions and has no or limited emissions disclosure. What this all adds up to is a definition of a fossil fuel company, which has no transition plan whatsoever and is doing no more than paying lip service to the existential threat of climate change 10 years on from the Paris Agreement.

In the 10 years since Paris, global emissions from fossil fuels have continued to set all-time annual records with another expected to be set in 2025. In recognition of the growing threat from climate change and the urgency of meeting their climate commitments, ANZ's big 4 peers, Commbank, NAB and even Westpac have all set bare minimum standards for a fossil fuel company to meet with its transition plan. If it fails to meet those standards, it won't be banked. ANZ is an outlier in the sector on this issue.

It is the only big 4 Australian bank, which has no red lines for fossil fuel clients' transition plans. This sends a clear signal to ANZ's fossil fuel customers. But despite having no plans to reduce emissions, they are still a bankable prospect. For years, ANZ has said that it would expect the Paris-aligned transition plan by the end of 2025. Yet we are at the end of 2025, and it is clear from the bank's own disclosures that this is not ANZ's expectation because it is still willing to bank clients which don't have a transition plan at all. This has been reflected in its financing decisions.

Earlier this year, ANZ took part in a $12.9 billion loan for BP, around the same time the company abandoned its renewables diversification strategy to focus on developing 20 oil and gas expansion projects by the end of this decade. In June, ANZ took part in a $1.8 billion for Woodside, a company which just 2 months earlier sanctioned one of its biggest LNG projects ever in the United States. This decade alone, Woodside is already committed to spending almost USD 30 billion on new oil and gas projects. Apparently, this hasn't been enough to make ANZ reconsider it support.

Finally, in November, just over a month after its requirement for credible transition plans came into effect, ANZ acted as a co-manager for a $1.5 billion bond for Santos, a company pursuing up to 3 new oil and gas projects and just announced plans to begin drilling in one of Australia's biggest proposed gas fracking developments, the Beetaloo sub-basin.

ANZ's financing decisions to support these clients are not supporting the Paris goals because the expansion plans of these companies are actively undermining and threatening any possibility of achieving them. If ANZ is committed to the goals of the Paris agreement, it should be withdrawing financial support to fossil fuel clients that fail to present a credible transition plan. We strongly urge shareholders to vote in favor of this resolution, not only for a better planet but for a better future for our bank. Thank you.

Thank you, Kyle. And whilst I don't necessarily agree with your characterization of events, nonetheless, I think it's so important to give you the opportunity to raise these issues. So thank you.

Okay. I will now take questions on the annual report, general questions and answers and the external resolutions being item 5 and the conditional items 7, 8 and 9, which although they're not being put in the meeting today, we are happy to answer Q&A. And we'll do that before we have presentations and Q&A on the other formal resolutions.

To be clear, this session will include any and all questions and comments in relation to deforestation, climate or environmental matters, which we will not be responding to later in the meeting. I get those questions in now.

And a quick reminder, we ask that you respect the rights of others at the meeting and be as concise as possible when addressing the meeting. For those in the room, the people you see at the microphones are ANZ staff members. So microphone 1, we have [indiscernible]; at microphone #2, we have [indiscernible]; at microphone #3, we have Shital Shah; and at microphone #4, we have [indiscernible]. So thank you, all of you for agreeing to do this and for helping us with today's meeting.

If you are a shareholder, proxy or corporate representative -- sorry, if you are a shareholder, a proxy or a corporate representative, and you'd like to ask a question, please approach one of the microphone attendants, show them your white or green card and give them your name. And I'm going to start with an initial question from the floor, and we'll rotate between questions from the floor and from the online platform. So with that, can I have the first question from microphone #2, please.

Thank you, Chairman. We've got a question from [ Sue House ] from the Australian Shareholders Association.

Thank you. Good morning, Mr. Chairman. My name is Sue House, and I'm a volunteer representing the Australian Shareholders Association. Today, I hold proxies from 970 members and nonmembers for approximately 4.8 million shares in ANZ Group Holdings, which, if consolidated, make our organization #17 on your top 20 shareholder list. We note that you have over 480,000 registered shareholders, which does not include those who have an interest in ANZ via their superannuation fund. 90% of these shareholders hold 5,000 or fewer shares and therefore, fall within our target membership base of representing mom-and-dad shareholders.

Given that enormous retail shareholder base, today's annual meeting is the most important event on their calendar as it is the only opportunity they have to hear firsthand from the Board and management and vote on matters put before them. We, therefore, look forward to a productive and respectful meeting this morning. We would like to commence proceeding by raising 2 questions on behalf of the Australian Shareholders Association and I've also received one question from a New Zealand retail shareholder that I would like to put to the meeting.

The first question is, in recent AGMs, both you and the previous CEO gave assurances that regulatory matters in dispute with APRA and ASIC were being dealt with appropriately by the company. In light of the substantial penalty agreements reached with both these regulators over this past year and the significant loss of shareholders' funds as a result, how can shareholders trust any reassurances given by the current boards in terms of risk management?

So I'll answer your questions one at a time. Okay. And thank you. The ASA does very important work. And as you said, you are all volunteers. So we appreciate that you do that on behalf of retail shareholders. I think it's important to describe the role of the Board in how it runs ANZ. We don't run the day-to-day operation, we provide the governance role. And the governance role is all about, first of all, agreeing and setting the objectives for management; second of all, approving the strategy they identified to get there; and thirdly, monitoring performance and taking action where necessary.

And what that means is when things don't work out, that the Board is willing to act independently of management, get to the bottom of issues, establish the facts, drive change where it's needed and enforce accountability. And in terms of that, what you've seen as shareholders in the case of ANZ and in terms of these regulatory matters is we have acted independently. We've appointed our own independent external experts where required. We have established the facts. Where necessary, we have established accountability, as you can see in today's report. And finally, we've driven change, which you've seen with significant refresh of the leadership team and we've appointed an external person who's got tremendous experience in driving transformation and change within the organization.

The final point I'll make is we thought it was in the best interest of shareholders to agree with regulators what was necessary in order to resolve any of their concerns and not to get involved in extended and expensive litigation. So I think your Board has actually acted with a degree of strong diligence in these matters.

And so a follow-up to that, could you comment on the timeliness of the Board's reaction to the various things that have been raised in these investigations?

I will indeed. And in fact, it's important to point out the Board has been through a lot of renewals. So 6 of the 9 Directors you see here today, as I mentioned, have joined the Board in recent years since 2023. But actually, the Board, as a team, have been leaning in on issues for quite some time. We agreed with management a reset of culture in -- post the Royal Commission, which is all about our focus on helping communities thrive.

In 2022, the Board lent in when it saw that a major program on nonfinancial risk was not being executed as it needed to. The Board appointed an independent expert to review it, drove changes in the leadership and the way the program was being run, agreed a new technology platform and appointed an external party to continue to review and track progress on the program.

When the markets issue arose, the Board appointed its own independent legal counsel, insisted that there was forensic analysis done on the bond trading that actually allowed us to protect shareholders because we pushed back against well-intentioned parties outside who claim there was more serious charges of market manipulation the Board said, no, there isn't. And ultimately, the settlement we reached with ASIC accepted that.

We appointed an external reviewer on ANZ Plus to report directly to the Board when we were not confident with the rate at which that technology was moving. So the Board has been diligent and timely throughout. Look, things will go wrong and what matters to you as shareholders is does the Board act independently, get at the bottom of issues, identify what changes are needed and make them and enforce accountability. And in that respect, the Board has been proactive throughout.

My second question is, ANZ is the only bank to still have a capital overlay placed upon it by APRA. Earlier this year, APRA imposed a further $250 million capital overlay requirement on the bank, taking it to $1 billion in total. Due to its concerns around nonfinancial risk, when can shareholders expect a resolution of APRA's negative assessment of the bank on this matter and have this capital overlay requirement of $1 billion removed?

Thank you, Sue. And these issues largely flowed as a result of the market this year last year, which then led to further reviews, and we offered an court-enforceable undertaking to APRA. Building on that, we've actually widened the program to not just deliver what we've committed to APRA, but to drive a wider transformation across the bank. And what does that mean in practical terms? What we are doing is doing a review of all of our core processes, reengineering them where we need to be, establishing new ideally automated controls and reporting and driving a big cultural change across the bank. And that's been Nuno's initiative, which I described earlier as packed.

We hired a senior executive who led a similar program at one of the other banks who is highly respected by APRA and who I believe has given them a lot of confidence. We believe that these initiatives will actually lead to a much stronger and better bank, and I've heard that feedback from the leaders in other banks in Australia who've been through the same process. Typically, what happens is it takes about 3 years at least before you're able to show significant progress. Usually partway through this, APRA will start to recognize progress by reducing the overlay. And then ultimately, when you complete, they will remove it. So that gives you an expectation. But fundamentally, we don't see this as a compliance exercise. We see this as an important moment to actually transform and change the bank.

And then I have one question from a New Zealand retail shareholder. Independent analysts indicate New Zealand operations return on equity is 21%, whereas management indicates this is 13%. New Zealand has provided significant profitability to the group. Given the 3 New Zealand government inquiries, is New Zealand a risk and governance issue for shareholders? And can you explain the Board's position?

Well, we think New Zealand is actually a badge of honor or badge of pride for the bank. We are the #1 bank in New Zealand, one in every two Kiwis banks with ANZ. It's an incredibly well-run bank. That's the reason why it is a leading bank in New Zealand. It has performed strongly and well. And we actually have 2 New Zealand directors on the Board to reflect the importance of that franchise to us. So I hear the concerns. But I think if you look at the actual performance of ANZ in New Zealand, it's been very strong.

Okay. Next question is on microphone #3, which is Michael Sanderson.

Thank you, Chairman. I have Michael Sanderson from Hunter Valley.

Welcome back, Michael. You are a marker for me of Christmas every year. I know it must be coming when I see you in your bow tie at the AGM.

Thanks very much, Paul. Just for housekeeping. Section 250 of the Corporation's Act requires a Chair of the AGM to allow reasonable questions and comments, and it's an offense of strict liability under Section 6.1 of the criminal code, not to do so.

My concern is, it's been this thing about 2 items per -- 2 questions per item. That in itself isn't so concerning, but I've heard it from a number of banks this year, which suggests there's some collusion on online questions, I'd caution you against editing them. I know I put in a number of questions to Bendigo Bank because I wasn't able to travel due to a pacemaker. So I'm now bionic, it's going to be around for a few years.

All those questions were altered. And the result was not the question I asked, now that's subject to an ASIC thing. One more comment, not to diminish the issue at Bondi Beach in any way. Violent deaths in Ukraine, this is civilian deaths, 2,311; Sudan, 3,384; Gaza, approximately 70,000, U.S.A. 13,821. It seems that avoiding it's not our backyard, it's of little consequence on to my questions.

I have got a number of questions. I'll do 2 now, sit down. I'm quite sure other people in the room will probably address some of mine. It's been reported that General Counsel, Ken Adams held a function at his home after the ASIC $240 million penalty. I believe there was about 30 guests catered for 4x4 side events. The menu included Laurent-Perrier champagne and canapés. I believe Laurent-Pierre goes from $100 to $500 bottle. The question there is why not bring sausages or bring a plate.

I believe this is all paid by ANZ shareholders. What was the total cost? Who approved it? And which ANZ policy allowed it? Why was this held at all? What was being celebrated? Was it the $240 million penalty that could have been worse, if ASIC was fit for purpose. I believe a judge said it was a bit on the light side. Did ANZ, and this is important, did ANZ seek, negotiate or receive a discount from ASIC?

Can I just clarify the question then, Michael, is the question about the catering?

The question was about the catering, the purpose of the party and what were they celebrating?

Okay. So in terms of that, and this has been reported in one of today's media outlets. As is common in many organizations, if people are putting an extraordinary effort, then I think it is appropriate, indeed, it's important that there is a recognition of that. And so Ken's event was to thank people who had worked over weekends and nights over many, many months on your behalf as shareholders to make sure we had the best possible position in our engagement with regulators.

These are people who got families, and then they're willing to stay away from families in order to work on your and my behalf. So it is a way of saying thank you to them for that. It was not a celebration of an outcome. It was a thank you for what you've done. And I frankly think it was very appropriate. I think it would be wrong of us not to do it. I should also say, Ken is an outstanding council. We are very fortunate as shareholders to have him on our team. He's one of Australia's leading litigation experts, a great expert on corporate law. So I fully acknowledge the question, but I want to reassure you, it was very appropriate.

I don't accept that response. These people aren't on a minimum wage, are they?

These people are working very hard. But next question.

You still haven't addressed the -- did you seek or negotiate or received a discount from ASIC?

We did -- we thought it was important as a Board that we provide a proactive approach to the regulators. So we did approach ASIC and say we were willing to have a conversation and discussion, willing to share the information that we'd identified in the Board's own independent reviews and that led to a discussion which led to the ultimate settlement. And that's what you would want us to do as shareholders to be responsible and not to get involved in expensive litigation, which could prolong things and also have a significant drawn-out impact on reputation.

So things haven't really changed since the Royal Commission.

Well, I would disagree strongly with that, but nonetheless. Next -- you've done 2 questions, Michael. And I give the floor -- I would remind you, part of my obligation in the Corps Act is to make sure every shareholder has a chance to ask a question. So that's one of the reasons why we're keen to make sure no one stands too long at the microphone.

That's my 1 question. My second question is relates to greenwashing. The Recent House Economics Committee, Mr. Matos told Parliament that the ANZ remains committed to its 2030 targets and the Paris Agreement. Dr. Warren told Parliament, it is now a very clear public policy that gas plays an important role.

Peer-reviewed research by Professor Howarth found that LNG has a life cycle greenhouse footprint, about 24% to 275% higher than the life cycle emissions of coal. 170 scientists, including Howarth wrote to President Biden warning gas is worse for climate than coal. Were those comments to the committee made in ignorance of the science or to curry political favor? Will ANZ correct the parliamentary record? Would ANZ agree that we don't need more gas, we need less gas exports and is ANZ greenwashing for profit?

Thank you, Michael. This is a copy of ANZ's 2025 climate report. It is available to all of you online or you can have a hard copy if you apply to us. And in that, we are disclosing sector by sector how we're honoring our commitment to reduce carbon emissions to the people we lend to in line with the Paris Agreement. It is available and public. I will add, we have made a commitment that we would publicly reduce our finance exposure to oil and gas by 40% by 2025, we've actually achieved 56%. So we are being fully transparent and accountable.

I have said previously, and we are very public, gas has an important role to play in transition. It will allow Australia to shut down far more damaging coal plants. Over half our electricity today is generated by coal. And as we switch to renewables, we need the ability for plants that can be brought on quickly or turned off. You can't do that with coal. You got to leave it on most of the time. So gas plants will allow us to have more renewables in the grid and will provide reliability of supply.

It is a transition fuel we have committed to reduce emissions in our loan portfolio in line with the Paris Agreement. That continues but gas may play a part in delivering that. That's something I've been talking about for at least the last 12 months. I think I may have even mentioned it 2 years ago in my AGM address.

You've missed the core bit.

I think you've had your 3 questions now, Michael. So I'm going to give somebody else an opportunity to ask a question. If we have time, we will come back and allow you to ask more.

Okay. So I've now got microphone #2.

Thank you, Chairman. I have Craig Caulfield from Queensland regarding item #1.

Welcome, Craig. Good to see you again, too. As I said, Christmas is definitely on the way.

Nice to see you. How will the Board be viewing Shayne Elliott's unvested $8 million bonus given his undeniable, poor, very costly leadership of the bank and what could be argued as ANZ's worst decade of malfeasance under his direct control.

Thank you, Craig. I think it's very important to you as shareholders and to our people out of the community that we are seen to be balanced and fair. I think it's important to recognize, Shayne did do some very important good things for the bank. He's widely applauded for the work he did on reversing ANZ out of its Asian expansion strategy. He assisted us in acquiring Suncorp and despite getting initially rejected by the regulator, getting it approved. And as Nuno recently highlighted, we have actually pretty much doubled the synergies we expect to get out of Suncorp.

But as you say, there have also been issues where we need to take some accountability. CPS 511, which is the regulators mechanism for how we set up salaries and incentive payments in the sector provides the mechanism for that. It requires us to stream incentives to executives out over many years. And what you've seen in this year's rem report is we have enforced some accountability in terms of the former CEO in terms of reducing and taking away some of those payments in future years.

And in my speech, I made the commitment that we will continue to work in that mechanism to be just and fair and to take any action that is merited.

Thank you. Well, you talk of being just and fair and trying to be balanced. Consider that Mr. Elliott has been paid $70 million during his tenure, he's received many bonuses along the way. And we're talking about bonuses, short-term and long-term bonuses, were the Board was derelict in deducting those bonuses or removing those bonuses. I thought you were disingenuous in your answer to the Australian Shareholders Association about the penalties ASIC and APRA.

So is this a question, Craig, or you making a speech?

Yes, It's a question.

What is the question?

There's a lot of context to this. Everyone in this room and all the shareholders listening are interested in Shayne Elliot's pay.

Can you get to the question?

Shayne Elliott is paid $2.5 million as a base rate regardless of the bonuses. So $70 million is being paid, $2.5 million and all of the areas that have been in the past not resolved, I don't agree that this $8 million should not be left for you to agree to give him a bonus, he should have all bonuses removed. He still gets his $2.5 million.

Thank you for expressing your views. What is the question, Craig?

Will you remove the $8 million unvested bonus?

We are required, and you can see that this issue before the courts. We are required to act in a just and fair way, but I've been quite clear in my speech, where it is merited, we will act.

Thank you. Next question, which is online. So Clare, are you going to read the question out for us?

I have a question from Ms. Luisa Williams. How can you justify removing contractor roles as a sweeping reduction without actually considering what they do? You mentioned empathy, yet these individuals have been given no support. How does the bank expect to service customers when less people are being asked to do more?

Thank you. And there's a number of elements in there, and I might even invite Nuno to add to my comments, but it's very important to state that, first of all, nobody, nobody wants to undertake a restructure like this unless they really have to. I've worked in organizations myself, and I know the impact both on those staying as well as on those leaving. But the reality is that where we see duplication, where we see things which are not core to the strategy we need to undertake, where we are carrying a higher cost due to the same activity than our competitors, we reluctantly have to take action. And so that's what we are doing. We do provide support to departing employees. And I'll invite Nuno to just talk a little bit about the work we've done to make sure we are treating people in just and fair way.

Sure. Thanks, Paul. And again, like you said, Paul, this is one of the toughest decisions one can make when we are leading a business or a company. It's certainly something we don't do lightly, it is certainly always want to avoid. But it's also something that a company leader has to take when is the right moment to do it after due consideration. We -- for all employees impacted, we have put in place a program which -- by the way, in part of the program, we had the consultation with the FSU and we build it together, especially on the mental support part.

The program has 3 components. The first component has to do without placement and we offer services that include advice on how to approach the next job, how to create the resume, how to prepare for interviews and financial advice. The second component is about well-being, and we offer confidential services to our employees to access our employee assistance program. And by the way, we have people in the room, if needed.

We also have our ANZ well-being team, which includes registered psychologist. And as a third part of the program, we also provide financial support if needed. If any employee is struggling with their finances, they can access our hardship support services. And again, ANZ has a mental health road map and program, which was developed in consultation with the financial service unit, and this road map is essentially to our strategy to enable a safe workplace.

Thank you, Nuno. Okay. I think we've got another online question. So Claire, are you going to read that for us?

We have 2 questions from Ms. Shirley McLeish. First question, there has been a lot in the news about 3,500 people being let go from ANZ. How many have actually been let go? And if there are more retrenchments to come, when will the final number be reached?

So I think as we disclosed at our results, 30% of the 3,500 had left at the end -- by the end of October. We're on track for the majority, almost everyone who is leaving the organization to have left by the end of the first half of 2026. Nuno, anything you want to add to that?

That's exactly it, Paul.

Thank you. Okay. Next question.

Second question. The issues ANZ have been having have clearly been growing for some time. Adjustments to executive remuneration are warranted. But what about accountability that the Board itself is taking for lack of governance while these issues have developed?

I think I'm in danger of repeating my first question and answer, which is Boards provide governance, the question to be asked on board accountability, was the Board proactive in identifying issues, stepping in and taking action and establishing the need for change. We did it on nonfinancial risk way back in '22. We stepped in on ANZ Plus. We've stepped in on markets. We have stepped in on other issues. The Board has been proactive.

The challenge you've got is as you set the objectives, you agree the strategy, you monitor performance and you step in when you're not getting it and the Board has demonstrated that. Finally, I would add 6 of the 9 directors have joined us just in the last 2.5 years. So I think that's also something to be taken into account. Despite all that, the Board has been strong in its actions and in enforcing accountability.

Next question, please. Microphone number #2.

Thank you, Chairman. I have Moira Corfield from Queensland regarding topic 1.

Are you in some way related to Craig?

Yes, I'm his wife.

Well, welcome. Good to have you here.

This question has been asked, but I'd like clarity on it, please. So if I can ask my question and then you answer that would be much appreciate.

Well, the answer is already being given.

No, I want clarity please. In 2019, APRA deemed that ANZ for several years had multiple failures across the organization in governance, culture and accountability. In 2024, ANZ had not repaired this and APRA in frustration added a further capital penalty of $250 million saying the Board is negligent. Chairman, you apologized profusely and said you were taking this seriously. Well, in 2025, we could see that you hadn't taken it seriously, either in 2019 or in 2024, and APRA proposed a further capital penalty of $250 million cascading to a total of $1 billion.

Based on the series of cascading failures across many divisions over many years, largely under Shayne Elliott's watch. But also under your purview from the Board, transparency has been missing, accountability has been missing. You have an opportunity today this morning to refresh with our new CEO, Mr. Matos, to say transparency counts, and we are releasing the 2019 APRA report in full. Just like the Commonwealth Bank did, just like NAB did and just like Westpac did. Chairman, will you release the original APRA report now?

Okay. Thank you for the question. And obviously, I don't agree with the characterization in your statement. But this was a decision in terms of the release of that statement that was made before I took on as Chair and indeed, think before I even joined the Board. I haven't given it any thought a consideration. So I'll take your question on notice.

Wow, after all this time, you're saying that, that's disgraceful. Thank you.

Thank you. Thank you. Thank you for the compliment. Next question, please. Microphone number #1.

Thank you, Chairman. We've got Noel Ambler from the Gold Coast.

Good morning, Chairman. And first thing, congratulations on the Board appointing new CEO and obviously, the Board supporting him. That's a bit of a change from the previous question, isn't it?

There's a thought coming, isn't there now.

However, recently, my business and quite a few other small businesses, and individuals had their accounts frozen by the KYC team.

For everyone's benefit, that's Know Your Customer. It's a legal requirement that we can prove we know who are banking, and is designed to prevent money laundering and criminality.

It didn't really answer the question. However, it continues. This was done -- our accounts frozen after receiving an e-mail thanking us for supplying information previously requested. One of the internal procedures and oversight mechanisms ANZ follows that fail to prevent the second unwarranted account freezing on the 18th of June, especially considering assurance was given after the first incident that the action would never happen again. And how does ANZ account for the failure to document prior resolutions and assurances within the KYC system.

Before you answer, it gets worse. The action of freezing our accounts was taken on pay day. How does ANZ propose to provide adequate compensation for the costs and significant stress caused by freezing the account on a staff payroll day, specifically addressing appreciate the financial distress potentially being caused to over 50 staff members, many of whom live week to week and rely on their pay day to meet essential commitments, house payments and living expenses and rent, et cetera. And what compensation is offered to our personal staff member who transferred money from our own personal account into the wages account so those staff would be paid.

Does ANZ acknowledge the enormous reputational damage. Given the actions, as you said earlier, were instituted under the anti-money laundering Act, and the reputation that our business could have suffered if those staff had not been paid. And the inference was it was caused by our business money laundering. After all the correspondence, which I have addressed to ANZ on this matter, it's been totally ignored. So which director can I speak to after the meeting today and have a further chat?

Well, first of all, Noel, I come from a small business family. My mom and dad ran a small business. So I know the mayhem that can be caused if you're not able to deliver payroll on the day you need to. So I apologize. That is not a situation we would ever want to put a valued customer in. So my apologies for that. We would like to benefit from learning what's happened here. We -- in fact, I'm happy to receive the information myself via one of our team. And obviously, we'll follow up.

Typically, there is a process which goes through a fairly systematic set of steps before we would actually freeze an account. So I'll need to get to the bottom of it and understand what happened in your case and take the learnings and make sure we apply them in the future. It is a serious issue. The government quite rightly is wanting to make sure that terrorism, crime, drugs, et cetera, cannot be facilitated by banks allowing payments to be made or money to be transferred, but I absolutely apologize for any inconvenience because you pass the information to one of the teams with microphone or indeed, right to me at ANZ, and I'm happy to follow up and respond to you personally.

Thank you, Mr. Chairman. I already did write you and unfortunately, didn't seem to get through.

Didn't go through. I do get complaints and I do normally follow them up. So I don't know what happened. Again, if -- you may contact one of the team, they can come to me and I'll make sure if you give them your e-mail address, we'll reach out to you.

Thank you, Mr. Chairman. I look forward to a response, especially with this new, what was it again, customer first from Nuno.

Okay. Next question, please. We're again at microphone #2.

Thank you, Mr. Chairman. I have Paul Herman regarding item #1.

Good morning, everybody. I run a couple of customer support groups. So one is Bank [indiscernible] customer support group and ANZ Unhappy Customer Support groups. I've actually had some experiences which led me to do that to run those support groups. But look, I just did some research. And of the 4 big banks, ANZ has the highest rate of complaints -- customer complaints as a percent of customers according to AFCA Datacube. ANZ's complaint density is the highest. ANZ was fined $240,000 by ASIC in part for failing to respond to customers adequately. At the last AGM, I was referred to the customer advocate Meg [indiscernible]. Your website actually says that Meg's still working for you. But apparently, she has left ANZ.

One of the things that I have a real difficulty with dealing with ANZ staff is various tactics used on me, and I've heard the same with -- through my support groups that we had weeks of delay in receiving responses to e-mails that I send, had missed appointments, had canceled appointments at short notice, which -- and this repeated pattern really inconvenienced me and inconvenienced my support people. These tactics I just Joe Longo said from -- who is the ASIC Chair said time and time again, ANZ has betrayed the trust of Australians, and he described ANZ's behavior as scrubby.

Can you guarantee that these tactics will stop in regard to dealing with especially legacy cases such as my own. But look, I have so many customers, ANZ customers who are legacy cases who are struggling to deal with ANZ sometimes through the court system, sometimes just in -- as in my case, dealing with the customer advocate.

Okay. Thank you for the question. One of the things I mentioned earlier that we are doing as part of the customer first is going through all of our processes and understanding where are they creating any issues or any friction points. So that will be a company-wide program where you'll be able to see a significant uplift in our performance over time. I'd acknowledge clearly from what you've said that there have been some poor experiences, and I think we would be keen to understand and benefit from those as well. Nuno, is there anything you'd like to comment on, particularly in terms of the work we're doing on customer first?

Sure. Obviously, the first thing I would say is acknowledged the fact that we settled with ASIC because we recognize that we had failings in those areas. So we agree that we need to do a much better job. That's the first one. The second one is we have no intention at all, certainly not as a policy or a procedure to delay anything. That's absolutely not the intent. So I apologize also if that happened in a specific case or in specific cases.

Our customer first strategy is exactly about delivering the right experience to customers, okay? And the complaint management is a critical part of it. We want to make sure that when customers complain, obviously, we expect them to not complain because services are doing well. But in the reorganization, as always, complaints, it's part of how things evolve. We want to be the minimal number.

I don't have the minimum number, but when they occur, we are trying to solve them as fast as we can and in the first contact point, even though our numbers today are not where they should be, I am very proud to say that at this point in time, we are making sure we collect all the complaints from all channels, so we don't miss any. And we have all of them registered. I also received many by the way, individually, and I read them all, and I pass them to the right teams, and I make sure they are addressed.

Second, I'm also pleased to say that we are now addressing them much faster. In terms of our number of complaints that are still open, they almost halved from May to October. So while we are not there, and we agree with you, I must say that the direction is the right one. And I ensure -- I can assure that this is absolutely priority #1 of the team.

Okay. I think that sounds great. And I think that if that reflects in the AFCA's numbers on DataCube, that would be really great because ANZ at the moment is the worst or has been the worst. But personally, what I've been concerned about is negotiation tactics. So especially, like I -- as you well know, I have fought for justice with the ANZ Bank. And in response, I feel that ANZ Bank has used tactics, which are inappropriate. And some of these delaying tactics just keep recurring from the same employee, especially -- I was dealing with Meg and just kept recurring. So yes, I'm very concerned about that and so are other customers who had difficulties.

Thank you for the feedback, and we acknowledge and we'll work hard to address. Thank you.

Who can I speak to...

We have some of our customer team here today. What I will ask is that one of them makes contact with you while you're here.

I look forward to having a good working relationship with them. So what's in the past is in the past. And I hope that in future, we can work constructively together.

Thank you for that. Okay. Next question is on microphone #4.

Thank you, Chairman. I have Natasha Lee regarding Item number.

Welcome, Natasha.

Firstly, I'd like to make a comment and basically complaints about the security, which happened, notwithstanding the tragic events over the weekend that they already require a bag search and they've got metal detectors. Is it necessary for us to carry everything in our hand. It's totally ridiculous given that we are the owners of this company. I know that this is an ICC matter.

Well, Natasha in fairness, we've got an obligation to everybody here to keep you safe. And sadly, there are people who look to disrupt these meetings. So it is inconvenient, but actually, it's been done with an eye to protecting your safety.

I think, yes, it's just a bit over the top. And I think that there are probably better ways rather than treating everybody as a criminal. But anyway. And I think that there's been issues with this venue in the past.

Natasha, can I get you to ask the question so we can make sure we keep the meeting moving.

Okay. Your ANZ recourse remediation plan, which is costing $150 million in basically next year. You said it's being funded by deprioritizing our initiatives. Now I know that the organization is going through cultural change. And there's a degree of technology. I just wanted to clarify what processes and how are you managing this deprioritization of other initiatives to make sure that things don't fall through the cracks. I think that whilst say it's customer first, there is a tendency to put everybody in the same pigeon hole, which doesn't necessarily translate to customer first.

Thank you, Natasha. So Nuno articulated this when he did the 2030 Strategy, but he worked with the Board over several sessions to agree a change and a redirection of our strategy. The biggest area is where we're able to drive some efficiency in the retail area, where we are reducing duplication because we have a set of activities that support Suncorp, a set of activities that support what we call our classic base and a set of activities, which support ANZ Plus. So Nuno is moving very quickly to bring those 3 into one team and to reduce duplication and cost. And that's mirrored in technology where we've been able to shut down a lot of activities and programs, and that's our focus moving forward.

Very importantly, we have ensured that there is almost no impact on the front line because we realize the importance of servicing customers, and that's been a priority for us. Nuno, anything you'd want to add to that?

I would just say, Natasha, that you pose a very important question, and I agree with you, but I would just want to make sure that we understand the rationale. And you've been highlighting. This is a moment to concentrate on improving the customer service. And by the way, the NFR and the root cause provision plan is about improving the customer service and not doing other things that should come later or doing things that are not -- or not doing things that are not aligned with the strategy. So it's a prioritization is what companies do. And at this point in time, the most important thing we have to do in this company is to get the basics right and deliver basic service in the right way to our customers as some of your peers just asked.

Okay. Yes, you keep saying things like that, and I suppose only time will tell whether you can deliver. I note that the costs associated -- sorry, the net interest margin on Suncorp Bank is a bit higher than the Australian Retail. So is part of that strategy to pick up or understand why those margins are higher and how to, say, duplicate onto to the Australian Retail side?

And Natasha, I can assure you, your Board asks exactly the same questions. We are always keen to understand the drivers of NIM, net interest margin. I do understand the reasons for variances, but Nuno, likewise has interrogated this. I should add, Nuno has very deep experience in retail, which has been a real advantage for us.

As we said, in a very transparent way, of our 4 divisions, Retail is one of those where we have the biggest opportunity, where we need to do better. And that means, again, improving the customer service, delivering products, which are more fit for purpose for those customers. and making sure that we deliver profitable services and obviously, also for our shareholders, and that means improving margins where we can. So all of that is being considered. Suncorp was a great acquisition, Suncorp is a good example for us in ANZ in retail. And again, it reinforces the benefit of that acquisition.

So you've identified the reasons why Suncorp is performing better. And hopefully, that will continue into the future.

Not only on that issue, but actually, in general, the way we view the acquisition, which, by the way, is the most significant change in the banking industry in terms of acquisitions in many decades. But what we've said is, let's take the best of Suncorp and the best of ANZ and pick whichever one is a top performer for us to use. So we've been very focused on that Natasha.

Okay. I've got some more questions, which hopefully, you'll allow me to come back later.

Happy. I just want to give everyone a chance to speak, and Farhan was going to add something brief.

The Suncorp net interest margin is not just the retail business, it also includes the commercial business within Suncorp. So when we compare it to Australia Retail, it is different in terms of the comparison. And the second thing I would just add is that Suncorp Bank does not attract any major bank levy versus ANZ, which, of course, does. So there are those differences in terms of mix, in terms of business banking as well as the major bank levy.

Thank you. Okay. Next question is we'll go to microphone #2.

Thank you, Chairman I have Morgan Pickett regarding Item #9.

Thank you, Chair. Last year, ANZ announced two policies, project finance restrictions on upstream oil and gas fields and new LNG export projects. But you are the only Big 4 bank to not have a project finance restriction for new pipelines. APA Group, a client of ANZ and Australia's largest gas pipeline company is pursuing enormous capital-intensive pipeline developments, solely dedicated to establishing what could be the biggest gas fracking development in Australia, the Beetaloo Basin. Given ANZ would not finance the upstream development, why has ANZ left itself open to financing the pipeline and will ANZ introduce a policy to restrict project finance for new oil and gas pipelines?

Thank you for the question. And look, we don't comment on individual customers. It wouldn't be appropriate, and they would be very unhappy with us if we did. We do bank energy infrastructure, and we are very focused on ensuring that there is adequate supply, and that's our philosophy. Overall, as I've said earlier, we are disclosing the emissions associated with our lending book and we have not resiled whilst other banks have, from the target that we set several years ago of bringing down emissions that we finance in line with the Paris Agreement.

But I've also been quite clear. I'm not looking -- there's no tricks as Nuno often says, no tricks, we are fully open and transparent. We do bank energy infrastructure that we think is important to ensure security of supply.

My second question. In 2021, ANZ introduced a policy to align its lending decisions to the Paris Agreement goals. ANZ stated that by 2025, the bank would expect energy customers to establish specific time-bound public transition plans and diversification strategies. This policy and clear expectation has been restated and further refined in each subsequent year.

By the end of financial year '25, institutional energy customers will establish specific time bound, public, Paris-aligned transition plans and diversification strategies for their businesses. The implication being that customers failing to meet the bank's expectation for such a transition plan would lead to the bank reassessing its relationship with that customer. And if it were to be in step with its domestic peers, ANZ would no longer offer new or renewed finance to companies that did not meet the bank's base level expectation.

However, this year, in the bank's renewed energy customer approach policy, this expectation was entirely removed. The requirement for Paris aligned transition plans has also been removed from the bank's 2025 climate report. My question is, why did ANZ remove this clear substantive policy requirement for a Paris aligned transition plan?

Just to clarify the question. So we have removed what?

From the energy customer approach, you've removed that -- let me quote you. This was your existing policy that by the end of financial year 2025, institutional energy customers will establish specific time-bound public Paris aligned transition plans and diversification strategies. That is now no longer your policy. It does not -- is not featured in your energy customer approach 2025.

Well, and it's actually -- I was just looking at Page 12 of our climate report where we actually talk about our LEAP program, and we're quite clear in there. We say that there are a number of customers who have improved during the year, and we talk about different categories of customers emerging, progressing and mature. 10 of our customers actually were upgraded this year in terms of that. We've assessed the majority of our energy cohort, and we've assessed them as having met or made substantial progress towards meeting our expectations.

What we say in the report is that we still have 16 customers that have remained in the emerging phase this year. And we are very tailored and focused with them. And what we've said about those customers is that if we don't see significant progress, we will either cap or reduce support in terms of credit limits. And ultimately, if we don't feel there's significant progress, we would exit the relationship with the customer.

And so from my perspective, we are still honoring the commitment we made in those years. And I want to be quite clear with you, we are absolutely focused on delivering our commitment in terms of the Paris Agreement.

Thank you. Well, in that same page and what you quote there, emerging and progressing companies, ANZ says are ones that are not Paris aligned. They don't have Scope 1 and 2 emission reduction targets aligned with Paris, they don't have material Scope 3 emissions reductions in line with Paris. But they are still eligible for new finance and you expect them to improve over undisclosed period of time. You have been working with these clients for at least the last 5 years and telling your shareholders and customers that you are working with them to improve their transition plans so that they do become Paris aligned by end of 2025, yet here we are. They are unchanged. They have not improved. In fact, they're expanding like they never had before, particularly in the oil and gas area and you were continuing to bank them.

I wouldn't agree with the characterization because actually, as I mentioned, we've actually upgraded. So the work we've done has led to 10 customers improving their actual stance on this year. And I have to say, obviously, I want to talk about individuals. But where we have not seen people cooperate, we have capped or reduced limits. We've refused to participate in new capital raisings. And when we feel someone's just not serious about it, we have exited. And one of those was quite high profile a few years ago. We prefer not to make a fuss about it because it's actually quite damaging to the customer when they seem to exit.

That's fine. I'm not asking you to out clients and name them and shame them. But all I want to understand is does ANZ acquire our Paris-aligned transition plan from its institutional customers?

Yes, that the goal. The goal is that if customer...

That is the goal or that's what's happening, the requirement?

Our objective is that our portfolio of customers have set clear targets that they have a governance process internally for measuring and tracking them and that they give some form of external reporting that we can check and verify. That's what we want to get all of our customers to. It is a work in progress. I mean we could easily walk away from people, where will they go? They'll go to a bank that may not require them to perform this work. They may go to a bank that may not have the skills and training internally for people to help them get to this work.

Our energy customers, for example, go through a very strict and rigorous process for approvals for any funding and finance. And that's elevated above what our normal processes would be. So we think we're being very responsible. It's constructive engagement and an attempt to get customers into the right place.

And yet you continue to bank them. The money keeps flowing.

If someone is working to try and get there, we will continue to work with them in the hope that we can get them to where they should be. And that's better for Australia.

And that's fine. But for an emerging or progressing...

If they're not making progress, as I've said, we'll cap the limits. And ultimately, as we have done, we will withdraw and stop the relationship. I think we've aired it enough. So thank you. So we'll move on.

Okay. Next question, please, which is microphone #4.

Thank you, Chairman. I have Martin Mansfield from Sydney, Items 7 and 8.

Chair, Board and Mr. Matos, my family are long-standing shareholders in ANZ with the shares I inherited having been held in the family since 1990. As an avid bird watcher and a grandfather of 2-year old, I'm also aware that we've seen a dramatic drop in the abundance of bird life in Australia. The bush is getting quieter. And a big reason for this is the destruction of habitat across the very broad ranges they inhabit, particularly for migratory birds such as the critically endangered Regent Honey eater and swift parrot. As a Board that relies on the trust of the community, can you please expand on how you think about our moral obligation to leave future generations with a world at least as abundant in life as we found it.

Thank you, Martin. It's an important question. And I think as we said earlier, Bank would only ever do as well as community does. This is a very important area that's emerging. So we've been talking earlier about carbon and climate that's governed by an international protocol called the TCFD, which is all about the disclosures and reporting. We're watching that evolved now in nature with a TNFD, and ANZ is very actively involved with that. We already require our customers who have a significant impact on land to adopt policies, which we ensure they comply with local regulation but also to minimize any potential harm or damage they may do.

And if we think a customer is in a higher risk category, we actually elevate the scrutiny and review of them. The challenge we have in terms of term all organizations have in terms of the emerging nature reporting is that we can get good data and good reporting from a large agri business and large organizations. But there's a significant presence here of farmers and small entities for which there isn't good data and good reporting. So I want to be clear that our unwillingness to make specific commitments about formulas for finance relates to the absence of data. It is our policy today to minimize the impact on nature. And we would hope that through the TNFD, we can develop industry-wide standards that we can then enforce.

So you would agree we have a moral obligation to leave the world as good as we found it.

Well, the bank's obligation ultimately is to act in the best long-term interest of the business. But from our point of view, as a Board, the long-term interest of the business are ensuring the well-being of Australian society, New Zealand Society and other markets in which we operate in. That's why we've acted proactively and at the forefront of the industry on climate, and that's why we are, again, very proactive on nature.

Next question, please. Microphone #1.

Thank you, Chairman. We've got Wendy Streets from the Financial Sector Union.

Thank you, Chair. I'm here this morning to talk as the National President of the Finance Sector Union of Australia. We've been representing members in the Australian finance industry for 106 years. We would normally have members here asking questions as we have done at every other bank AGM this year in recent months. Unfortunately, our ANZ members at the moment are too scared to talk. So I'm asking the questions today.

The behavior of the bank since the 9th of September this year has been nothing but atrocious when it comes to the treatment of your staff. You've said today you have empathy and concern for all of your staff. This has not played out since the 9th of September. 3,500 was the announcement made that day. The union has been accused recently by one of your most senior employee relations person for whipping our members into a frenzy and causing their mental anguish because we won't let this story drop in the media. I found that to be absolutely insulting to say the least.

We have been meeting weekly with your bank to try to make consultation work for our members. At this point in time, 2/3 of the 3,500, know that they're either gone or they are going on the week of Christmas. We've asked this bank to extend that. Your competitors, CBA and Westpac, not usually willing to do good things for their staff either, but they extended across the Christmas period to their staff who wanted to stay. And to those who wanted to go, they actually gave them the extra weeks pay.

ANZ flatly refused to do that. So your staff who have left in the last couple of months are on the unemployment line, leading into one of the most difficult periods of the year to find new employment with just a flat note from the bank. We've also asked for pay increases that are delivered in September but not paid until December but back paid to September to be honored for the previous 12 months' work for those walking out the door. That was a flat note as well. So the retrenchments were done on 2024 pay, not 2025 pay. No reflection of the extreme work that they've done over that period. In fact, what I would tell for shareholders is every single thing the union has asked for from ANZ to help these workers has been declined. Not one of our asks was accepted by ANZ.

When we went to the Fair Work Commission because we are still trying to identify the last 900 people. So there's about 14,000 staff who have the threat of their job hanging over their head. And in spite of weekly meetings, in spite of going to Fair Work, we cannot get an answer out of the bank as to whether staff are in scope or not. You've said here today, everyone will be gone by mid next year. You could at least put people at rest to know whether they're in scope for losing their job or whether they have an ongoing role in ANZ.

But to the best of our endeavors, we cannot get that answer out of the bank.

So Wendy, can you distill then your thoughts into -- what's the question you'd like for myself or Nuno to answer?

Sure. We would like to know we would like to be able to tell your staff, whether they are in scope, and we would like to know when will you know that? Because I can't for the love of God believe that you do not know where these cuts are coming from. You're going to get rid of another 1,000 people before June next year. You know which departments they work in. We can't even get that basic information. That's what I'd like to know.

Thank you, Wendy. And thank you for coming today. There is always a balancing act here because as you pointed out, people don't want the uncertainty, but we also need to make sure that we can do it in an organized way and that people are given clarity about what their retrenchment package is and what support we're willing to -- are able to offer them. And we have, we believe, been quite generous in our retrenchment, which includes placement support. We have met regularly with the union, and we believe that we have been forthright and open, but we will take the feedback.

It is a difficult issue. It is a very challenging issue. The feedback we do get from our staff is that they want the certainty but we also want to make sure we do it appropriately, carefully and that we don't miscommunicate. And as you know, we did have one episode where there was a miscommunication and so we're very sensitive about that happening again.

Nuno, is there anything you'd like to add?

It is to confirm what you just said, Paul, we want to do this right. It's a very tough situation for the employees that are impacted. So we want to make sure that we take the right decisions. If we do it too fast, we run risks to be unfair, and we don't want to be unfair to people. If we do it too slow, it creates anxiety, as you just said, so we are trying to make it right. And I'm glad that we are talking with you on a weekly basis. I certainly appreciate that. I know the dialogue is continuous.

You have my commitment that, that dialogue will continue. We are the most interested in having a company where there is a safe workplace and people are motivated to work. So let's continue to talk. Let's continue to interchange our ideas and you have our commitment that we are doing this for the right reasons.

Can I just say, Chair, the meeting where the union was accused of whipping staff into a frenzy and causing their mental health anguish was the meeting where we gave our survey results on how your staff were feeling. Like I don't think that's the way to go. I don't think transferring -- we didn't sack 3,500 people for goodness sake. I think an organization this big can do way better than that, and I think they should.

Thank you, Wendy. I acknowledge feedback, and I am also aware of your survey. Thank you. Okay. Next is at microphone #2.

Thank you, Chairman. I have Kyle Robertson in regards to item #9.

I'll keep this brief. So CEO, Nuno Matos recently commented at a Senate estimates hearing, that if we want to transition to a greener economy into a more sustainable economy, gas is part of that equation. And you yourself Chair made comments just 30 minutes ago that were very similar in sentiment. But my question relates to ANZ's views on gas' role in the transition given its commitments to the goals of the Paris Agreement. Because I think you would probably acknowledge there is a big difference between the use of gas peakers as firming for the grid and the enormous wave of LNG expansion, which is being pursued by the oil and gas majors, many of which are funded by ANZ. So my question is, is ANZ prepared to give further detail on the role it sees gas playing in the transition?

In general, we're happy to talk about our policies and our approach. I think we've been clear on the role of gas, which we think is important to transition, Kyle, let me take it on notice. I guess is there a specific area you'd like us to comment on?

I suppose if I can put a bit more meat on that question in a bit more details. The investment decisions of the oil and gas majors at a global scale and the intention of the industry based on those investment decisions seems not to be to play a supporting role in the transition to net zero. It instead seems to be to lock in large-scale, long-term dependence on their product for decades to come. I mean the amount of LNG capacity currently under construction in the world is going to see a 42% increase. And that doesn't include the amount of proposed LNG expansion, which would be a 225% increase.

I mean we're talking about a massive expansion of the burning of methane, a greenhouse gas, which is 80x more potent in the atmosphere than CO2.

And so if I know where you're taking it, Kyle, so thanks for giving you a bit more flavor. So what can we as a bank do in our backyard, we are quite clear. We have committed to reduce the emissions associated with our financing in line with the Paris Agreement. I already talked about the reductions we've made in oil and gas extraction. We've reduced our exposure to those in terms of what we finance. We said we'd do about 40%. We've achieved 56%. We've reduced the emissions associated with our oil and gas funding by 62%, so we have committed to you and to all shareholders to reduce it in line with Paris. So that will be the envelope within which we'll have to operate.

If I can make 1 final point and kind of where I'm getting at this is when as a bank that's committed to Paris, you say gas is a transition fuel. All the nuance in that is lost because the reality of what the global oil and gas majors are actually investing in is not that gas as a transition fuel, is that it is a dominant energy source for decades to come. So it is really important as a bank, even in the rhetoric that the leadership says publicly but when it says gas is a transition fuel, that it does get into the specifics about what is in and what is out because if this goes ahead, the result is going to be 3 degrees of warming. That's not aligned with your commitments.

And Kyle, I heard this morning that this is going to be a peak year according the IEA for coal production globally. And the only way we're going to get people off coal is by giving them alternatives, ultimately renewables, and we have to be able to support that. So we keep all of that in mind. We have said gas is an important part of that transition. I hear your feedback and we've been very public in terms of our commitments. The one thing I think we've always said is for Australia and New Zealand, where gas is required as part of our energy security, and that is an evolving policy with government, as you know where gas is required as part of energy security, we will fund it because we think it's important that our nation has access to affordable and reliable energy.

The one final thing I just want to ask there is ANZ as a bank concerned about the amount of proposed gas production that is currently occurring in the world and the fact that this could displace renewable energy projects and delay the adoption of the energy system.

Well, Kyle, I think we've been quite public, and I would hope you would welcome it, given what we've seen some international banks doing withdrawing from these areas, we've been quite public that we believe in the climate science. And we think it is prudent and sensible as a bank that finances things to do our bit to reduce global warming as well as of which we're also aware of the transition risk that there is for the wider economy as we move to a lower carbon future. So we're there. I think we're trying to get to the same place. The challenge is you're not always happy with the way we do it, but we're trying to be open and transparent and to get to the same destination. So we share your concerns.

The details are very important.

Okay. Next, we've got a question on microphone #3.

Chairman. I have [ Ram Mehta ] from [ McGervey ], and he has a general question.

Good morning, everyone. I have got ANZ shares for the last 3 decades. I have seen the number of ups and downs in the share price and the dividends and the franking credits. For the last 5 years, the performance of the bank, the profit is coming down and the operating expenses are increasing. Though the dividend is maintained, the franking credits are not actually not even 100% like a few years ago. So what I want to ask you is here, most of the people who are small investors, they are very much dependent on the dividend that we received from ANZ bank. That is a very important thing for us.

So that is one important thing. And another thing is the share price of the bank. In the last 30 years, I have seen -- I have not seen stagnating at same levels for quite some time now. So my question is, to your 2030 vision, how we are going to maintain the dividend and keep the share price high for all the shareholders here.

Thank you. Thank you, [ Ram ], and I would hope you would be appreciative of the fact that actually our total shareholder return in this calendar year is one of the leading in the industry, which reflects investors' reaction to Nuno's 2030 Strategy. Having said that, part of that strategy says that we are going to improve the return on tangible equity over time. We've given a target that we said we will go towards by 2028 and 13% by 2030.

We set a 3% cost down target for this year. We said we'll get cost to income for the bank back to the mid-40s in the forward time period. And what you have seen this year is despite the pressure that there was on profits from the significant items like the regulatory settlements, we maintained the dividend because we recognize two things. One is how important it is to shareholders like you and second of all, because of our confidence that the strategy will deliver and that we will be able to continue to support our shareholders. So hopefully, I've given you some reassurance. The 2030 Strategy has already won very strong investor support, which I believe is part of the reason you've seen such sharp increase in the share price over the last 6 months.

Mr. Nuno Matos' confidence and his assurance in his voice will certainly assure me that the bank will go in the right direction.

Thank you. Next question is microphone #4. And I'm keen to keep us moving because I know the longer these sessions go some of our shareholders leave. So I'm going to encourage everyone to be briefer in their questions, less statements and maybe quicker to the actual question.

Roman [indiscernible] from Sydney, Item #1.

Welcome Mr. Matos. My name is Roman [indiscernible], and I'm a shareholder. Chairman may comments to all shareholders regarding dispute/court proceeding with former CEO, Mr. Elliott.

I'm sorry, can you ask that again, please?

Can you make the comments regarding dispute or court proceeding with former CEO, Mr. Elliot.

Thanks, Roman. Apologies, I had a very temporary failure of the mic there. So no, I can't. It's before the courts. Clearly, there are legal proceedings. What I can say, the limited bit I can say is the Board was very deliberate and balanced in its decision-making and we are very confident of our legal position, and we will defend ANZ's position vigorously.

Good luck with this. My question is...

I think that was a positive good luck. Was it?

Yes. Yes. very positive. My question is, why this bank wasting money on misleading advertisement if the bank don't want to deal with small business?

Okay. In what respect has it been misleading?

You have great advertisement where the guy bring in a box of...

And he locks himself in the office and he's able to do his bank application in no time.

Yes. Great advertisement except my dealing with this bank, I need to bring 5 boxes and it's still not enough. You still asking for more and more and more documents. It's ridiculous. So why waste the money of this bank, if you don't want to deal with small business.

Each customer may be different. And so I don't know your a particular circumstance. We do have a customer team here today if you would like to have a chat to them. But there are customers for whom that process works very well.

I would love to chat with them. And my last question is your complaint department processes. Can you explain to all shareholders? I got 3 complaint numbers, and it's it. This is all your complaint process. You're getting the number, and then you wait for 2 years.

I think Nuno has already talked about the work we're doing on complaints. And by the way, we made a big investment in improving the technology for capturing, reporting and tracking complaint progress very recently.

But obviously, my suggestion, Roman is on both accounts. On the SME, on the small business issue that you have in terms of a lot of documentation that was asked from you. And in terms of the complaint delays, if you could write directly to me or I can call you if you want, I would be very much interested to understand because we are on this mission of improving customer service. So all information about it is absolutely useful. So whether you're write to me or I would call you, I would like to know. Okay. Thank you so much.

Sure. I tried to contact current Chairman, and it's just did not -- e-mail did not get through. But what really amazed me, when I try it to escalate a supervisor, I actually got another load of documents, which I need to bring to give the same -- it's absolutely ridiculous, but I'm happy to discuss it after the meeting.

Thank you for continuing to engage with us. Next question is microphone #1.

We Got Paul Fanning from Melbourne.

Nuno, welcome to ANZ, and I have traveled extensively in the Hispanic world and I can relate to your background in Banco Santander. Now look, I'm asking questions in regard to items 1 in the annual report. We have a very cut down governance report from Pages 16 forward in the annual report. Now your company secretary, probably, Simon [indiscernible] has deemed that there should be no skills matrix included into the main annual report. Now clearly, even your other 3 bank competitors have -- actually do have some form of skills matrix for the Board of Directors and yourself as the Chair.

Now that needs a clear fix, that need to be pulled -- if it's in the governance report, it needs to be pulled out and put into the annual report like your 3 competitors doing. Further, we need the skills matrix to be actually broken down to each Board Director and the attributes need to be assigned things your attributes for say 8 or 10...

So Paul, I hear you. Can you get to the question, please ?

Yes, my question is, are you prepared to take it on and do something about it? Why has it not been done? And what is your strategy for the future?

Thanks, Paul. And so to your point, on the corporate governance statement, also available online. And On Page 9 of that, we actually list the Board skills and experience that we want on the board. We have chosen this year not to put in the matrix which is because we're going through a review internally on both whether we've got the right skills and also on the profile we want in the future. That's part of our PACT program, but we would intend from next year to disclose them.

In common with other bank Chairs, I don't believe you want to do it by individual director in the annual report. I think that invites a degree of populism and a degree of argument of definition. But you would want to know that as a Board, we have the requisite skills on the board. And that's why we have listed what we want on Page 9 of the governance report. And then I will give you a commitment to have a more comprehensive skills metrics in the annual report next year.

Okay. Paul, we might need to do enough discussion meeting after the meeting. But clearly, if you can please get the skills matrix back into the body of the annual report and...

Consider it done Paul, consider it done.

And I'll have questions on REM and the Board election. And I can come again.

Thank you, Paul. Okay. We have another question on microphone #4, welcome Rita. You're another one of our stalwarts.

I've got Rita Mazelsky from Perth, Item #1.

Merry Christmas.

Merry Christmas to you.

I just want to say I arrived here on Sunday and I was watching the TV in my hotel room, and I just want to express my condolences to all the Bondi victims families because it's just shocking to know that it happened a couple of miles up the street from where we were all sitting.

And sadly, as we speak, there are still people in hospital.

Yes. Just for the record, we've kind of done questions in line with the notice of meeting, and it's been changed whilst we're here. So when people get up if they just want to ask if they ask questions under the wrong item number. It's because we've been told differently once we got here to address the items that you're showing up there. So there might be a little bit of confusion. So please bear with shareholders if that happens.

Okay. Sure, Rita. And I'm going to courage you to be brief because we absolutely do want to get to some of those other items.

Yes, I have come from Perth. And you're a very quick, fast person and you process things quickly as corporate people and the Board should do. But I think you need to have a bit of patience with shareholders because we're not all like you and we don't operate like that. So if someone's talking, I just feel it's been a bit unfair to ask someone to hurry up.

So my role is chair of the meeting and make sure everyone gets a say in...

Chairing the meeting and bossing people to be quick, is a little bit unfair. It doesn't happen in other AGM.

Let's get to your question, Rita.

All right. Firstly, Mr. Matos, it's not a question. I just want to say welcome. And I just wanted to touch on when the Chair said, it was like recruiting a star soccer player when you were appointed. I just want to say my dad was a star soccer player, but is most certainly could not run a bank. So in regards to customer complaints, I'm excited that Mr. Matos, the CEO and ANZ is taking a new direction to have a look what's going on in the bank and what's not being addressed.

As you know, there's a lot of long-standing customers that have issues. And for whatever reason, whether the bank doesn't understand or in my case, the bank won't meet with me, each case is different and should not be grouped into a long-standing group of cases that just gets wiped under the mat and ignored. They all need to be addressed so that the bank moved on because they will not go away, and you know that. and they are significant to the bank and significant to all the issues that have been happening with the governance and risk values.

To touch on it, in regards to lending, the bank has -- ANZ has an application process where customers must sign an ANZ personal statement of financial position. And ANZ confirmed this through the banking royal commission in 2017/'18. The document states assets liabilities and expenditure and ANZ is required to provide financial services efficiently, honestly and fairly as required with the license under Section 912 of the Corporations Act.

I've repeatedly advised ANZ, including the former CEO, the current CEO and yourself Chair and the Board that ANZ manager filled out that form for me, and I've never completed signed [indiscernible] statement. It's do with the process.

Okay. Because we're consistent in saying we don't deal with individual customer complaints in the meeting.

Yes. Well, this is about the process because this is actually systemic.

Can you clarify the question then for us?

Yes. And you're pushing me, which I've asked not to happen. My ANZ case, which I won't go into, but overarching had the ANZ break-free package, how does finance, had alone, had internal fraud, misrepresentation and manipulation, amongst other things. This has caused a flawed internal dispute resolution process in ANZ, which is significant because you are relying on your own falsified information for many customers across the board for different products and then making them go to AFCA based on your falsified information.

Rita, can I push you to clarify the question for us, so we can answer it.

So my question is given the significance of that document to responsible lending, forward risk and financial and customer harm, what governance controls and independent review processes does the Board rely on to ensure such matters are not dismissed or managed within the same business lines involved? And how does the Board ensure itself that unauthorized completion and reliance on false customer financial information are independently assessed and escalated rather than closed or ignored, particularly where the customer continues to be exposed to ongoing financial and nonfinancial harm due to ANZ's continued values.

Thank you, Rita. And I'll have a go at answering. There are a number of controls that exist when we're creating products include reviews by our risk team and reviews by our legal team. As we deliver day to day, the Board has supported a major investment in customer complaint technology so that every complaint is tracked from the moment that arrives. We're able to see its progress, and we're able to get themes and escalations. Major disputes will often come to the attention of myself or the Chief Executive. There's also the AFCA process for people to raise complaints, which is an independent body that then brings them back to us.

And then finally, I would say that in terms of ultimate issues, we also operate a very strong internal audit role, which does an audit review, and we have a whistleblower program or by any whistleblower issue is automatically recorded and flagged and the Board reviews those on a regular basis to the point in which we even interrogate specific issues and ask for more information where it's needed.

And that's -- everything that you've said is fantastic, and it's an awesome process if it was applied. How can legal, AFCA or ANZ internal order or investigations have a proper truthful investigation when it's relying on its own falsified information that its own staff filled out and paperwork customers has never seen to ensure that ANZ maximizes its benefit based off of our asset that you put a strangle hold on and you're going fine and you use for financial transactions, and we can't use the benefit of our asset.

Rita, you've raised these issues before, and I know you've also raised them through other bodies. And so I said we're not going to comment on specific issues here, but thank you for your question.

But who can I speak to or given that you've got a new process that you now track do legacy people have to now reapply with a new complaint to get a number in the system.

No.

Okay.Well, no one will meet with me. So what do I do?

Well, I'm not going to comment on your specific case, but we do have the customer...

You don't have to, I'm asking about a meeting.

We do have the customer team here today, and we'll make sure that somebody there makes contact with you.

I've actually written to Mr. Matos because you and the Board and the previous CEO have failed me since 2018 and decided to take a stance to continue ongoing financial harm instead of addressing my case.

And you are entitled to have your view of things and we're entitled to have our ours.

It's not a view. I have got the documentation that ANZ falsified and manger's name.

Thank you very much, Rita. Thank you. Let's move on to the next question. So microphone #2.

Thank you, Chairman. I have Ron Strauss for a general question.

The question and slight commentary is to do with the transition to the ANZ platform. It's not -- hasn't been really as smooth as it should have been. There's been lots of issues. They had 2 face-to-face offices in Sydney and Melbourne, they were closed without notice. The interest rates initially appeared attractive, and the names of the accounts changed. It was just like a game that was evolving. I mean even the young kid would have been confused.

Now the issue that I want to raise is we heard in the press that Mr. Matos was putting a dampener on the transition to ANZ Plus. Today we hear he's accelerating the process. So where do we really stand from this? And the other issue to deal with is lots of games. For instance, the man in charge of interest rates would know that you are forced to move some of your money to ANZ Plus to get a comparable interest rate to other banks. I mean it's like the Harbor Bridge, you're being forced to go over a bridge. And when you get across the bridge, there's one good thing that happens to you, you can view your other accounts through ANZ Plus, but you can't view your ANZ Plus accounts through the ordinary ANZ app.

So my main question is this. Is Mr. Matos committed to the program. He said today, he is. And my final question is when it does become operational in 2027, and we have this a mythical belief that everybody will have been transitioned to the ANZ platform, how many more job losses can we expect? And how many more branch losses can we expect? Because ANZ Plus is not a very personal service at all.

Thank you. Thank you for the feedback. These are precisely the issues that Nuno is looking to address, but I'll let him speak for himself.

Yes. Thank you so much for the question. Our intention is to have 1 single platform for all our retail customers in Australia. And that includes our classic platform, our Plus platform and in the 2027 Suncorp customers. We want customers to experience only one platform. That's the first thing I would like to say. The second thing I would to say is that the Plus platform after a thorough evaluation demonstrated to have the right architecture and solid technology. However, as the Chairman said, the sequence of build was not the adequate one. So what we are embarking, what we already embarked, it's in a program that is going to make sure that by September '27, all our customers in Australia, the 8 million I mentioned, including small business customers, will have access, will be migrated into this new platform, which will have all the products of the company in that platform.

That's our strategy. That's what we're committed to do. And to your point, it is not about games. It is about doing it for the customers.

Thank you . Next question, microphone #4.

Rachel Dobrik, Action 8, general questions.

Mr. Chair and the board. So I come from Action 8, a women's rights and climate justice organization working in 70 countries around the world. And we're concerned about the human rights violations associated with the fossil fuel industry and the human rights impacts of fossil fuel-driven climate change. And so I have a couple of questions for you about ANZ's grievance mechanism. Of course, your grievance mechanism provides a framework to accept and to consider human rights complaints associated with your institutional or corporate lending customers.

However, the mechanism does require that customers consent to a complaint proceeding through the grievance process. We asked about your grievance mechanism at last year's AGM and Mr. Chair, you told my colleague that it is designed to provide a solid vehicle for people to escalate and raise issues. We now understand that within the last year, at least one complaint from an effected community has been closed prematurely because a customer did not give consent to participate in the grievous process.

I'm not asking you to speak specifically on that issue. But given this, our first question to you is whether you believe ANZ's mechanism truly is a solid vehicle to enable effective communities to raise human rights-related complaints and to protect ANZ and its shareholders from financial and reputational risk.

Thank you. Thank you, Rachel, and thank you also for the letter that Action 8 wrote to our CEO, and I believe our ESG team has met with you. For the benefit of everyone...

We'll be meeting soon.

Oh, you're meeting soon. Okay. For the benefit of everybody, ANZ as a result actually of a dispute in the country, took the learning from that many years ago and put in place what we believe is a world first, which is a grievance mechanism, whereby people can raise human rights issues, and we will commit to respond to them. Look, I realize there is a complication for us because we have a requirement to get the customers' consent, but having said that, we still think we have an important role to play by raising issues with customers and by attempting to bring them together with those who've raised concerns or raised the dispute.

There were 2 grievances in 2025, one resolved, one is still open. To your point, even if we're unable to get the customer to agree, let me assure you that we absolutely take it into account in our own view of the customer. We have our own policy, our own tools and screening processes for what we call high-risk sectors, high-risk countries, high-risk customers. And in those cases, senior management is required to look at the customer if they want any new financing to look at them at least annually and to take into account any material transactions they may do. So even if they don't come formally into the mechanism, it is absolutely taking into account in terms of the relationship that we're running on going with the customer. Hopefully, that is it.

I have a couple of quick follow-up questions. The first, in response to you saying that you do identify some high-risk sectors, would you consider fossil fuels to be among those?

Well, actually, climate change is seen as a material risk for the bank. And as a result, it attaches a higher level of scrutiny and a higher level of review within the bank.

Okay. I'm just going to pause for a second. We seem to be getting a bit of interference? Maybe I'll -- shall I rely on the standard microphone and turn this off. Let's see if that works. Okay. No, still getting it. So I'll just pause for a moment, we'll let our sound people work on things. So, Rachel, I think your question was, do we see fossil fuels as a significant risk?

You mentioned that you have some sectors you would consider as high risk.

Anything associated with climate change is a material risk for the Bank, which means that it has additional scrutiny, reporting and tracking for the Board. And we ask our Chief Risk Officer, to ensure we have the processes in place across the bank to manage it.

I had one further follow-up question and then a second question. So my last follow-up question there is that your mechanism does allow the Bank to use leverage for customers that aren't willing to consent to be part of the grievance process. So I just wanted to ask whether ANZ would consider refusal of finance, a valid form of leverage.

Absolutely. Absolutely.

And what other actions the Bank might take as leverage to this way customers...

So very similar to what I mentioned earlier to Kaylee in terms of gas. If we don't feel a customer is someone who we want to bank reputationally, if we think they are abusing the communities in which they operate, we would walk away. If we feel that somebody who's maybe done it with poor intention or poor process, but actually wants to get to the right place, we would look to work with them and to give them an opportunity to improve. But all of that attracts significant scrutiny and tracking within the bank.

Great. And my second question is whether ANZ considers human rights complaints made about a customer either under your own grievance mechanism or to other bodies in making a decision to provide or facilitate financial customer?

Absolutely. I mean, as I mentioned earlier, it's that we -- our relationship managers would be absolutely aware of it, and we would take it into account.

Okay. Next question is microphone #3.

Thank you, Chairman. I have Lachlan Wells from Perth.

In just last month, you financed or you provided a $1.5 billion bond to a company that is expanding some of Australia's largest oil and gas projects. Now I won't name that individual company because I know that you don't like to discuss individual decisions. But I'd just like to ask how a decision like this is consistent with your commitment to not finance new oil and gas projects?

Thank you, and that's a really good question. Where -- in certain sectors, we have enhanced due diligence. They're actually energy and transport are 2 of those sectors, which means that a decision like that would very often include the senior management, the general -- the leader of the Institutional Bank, the Group Chief Risk Officer, and we also have a team who look at climate issues. So it normally goes through a screening process there. We consider any decisions relating to energy to acquire those additional controls and restrictions. And that all comes back to the commitment we've made to report annually on the emissions associated with our financing and to bring those down over time.

Okay. So can I confirm that you will finance companies that are pursuing or that are expanding gas in Australia potentially?

Well, it's not linear. So we -- what we've said is we're going to bring emissions down. The portfolio will change from time to time. And I was also clear in saying that if we feel actually it's going to enhance Australia's overall position in terms of reducing the burning of coal, for example, we would consider it on its merits.

Okay. So it sounds like then that, yes, what you value is -- or you believe that coal -- sorry, that gas is a transition fuel, and that will reduce Australia's reliance on coal.

That's exactly they're producing.

And I would assume that perhaps you made the same assumptions about exporting gas to Southeast Asia. In that case, why rule out financing for new gas projects?

I think because we need some flexibility and it's not linear for the reasons we just discussed, it's a transition fuel. What you have got is the commitment of the bank to bring down the emissions that we fund and finance in our portfolio in line with the Paris Agreement and to report it externally. You can actually track our performance annually by sector in our disclosures. So within that, there will be different customers. Our mix will change from time to time, and we look at each deal on its merits. So it's not a linear decision, and that's why we don't put a firm and rigid formula out there.

I understand that, but I'm just wondering what information I can rely on then because if you are not willing to put any red lines in place, how can I trust the decisions that you...

You can track us. You can track us. It's in the report. So literally, sector by sector, there's energy, there's oil and gas, there's what we're actually financing compared to the target. We're reporting it annually. We're giving you that transparency.

I understand that and you have an individual target for reducing emissions in the oil and gas sector in Australia, and I appreciate that. I just don't understand why you would have this requirement to -- why you would rule out finance for new gas projects.

For the reason I said, because the portfolio changes, it's dynamic, customers change. And also, we need to look at each loan on its merit. Our ESG is very happy to meet with you. I think I've answered the question as much as I can. I'm getting repetitive. But if you want to, we'll be happy to facilitate a meeting with our ESG team.

I would appreciate that. So thank you...

I'll ask the team to follow up with you before you go.

Next question is at microphone #4.

Thank you, Chairman. [ Ash from ActionAid ], general questions.

Welcome, Ash.

Thank you, and thank you to everyone. Greetings to the Board and shareholders online and in person. I'm Ash from ActionAid, a global women's rights organization. I have 2 questions relating to ANZ's financing decision-making. So my first question is, how are ANZ's commitments to achieving gender equality considered when making finance decisions? And a bit more clearly, does ANZ consider clients record on upholding gender equality in their projects?

We certainly have internal targets we ourselves have set, and we've made good progress on those over the last few years. I can't answer the question universally actually. I think -- I don't know, Nuno, whether you can provide some background on that.

I think we, as a company, believe firmly in diversity in general and including gender diversity. We would expect society to obviously adopt the same stance. We take it in our own company. I can't say at this point in time that we have a full developed policy to make sure that customers also follow the same approach. We can follow up with pleasure.

Thank you. And as you know, diversity is a very important issue to me personally. So take the feedback. It's a very interesting question to raise.

And for my second question, so we understand that ANZ prides its human rights-related policies and practice, but we're quite interested in how these are actually implemented. Can you confirm whether ANZ has ever refused to provide or facilitate finance to a fossil fuel company or project or to any other company, specifically on the grounds of human rights risks and impact? If not, what would constitute grounds for refusal?

Look, I think as I said earlier, we've got very specific tools and screening processes for customers we identify as being in what we call high-risk areas. That could be a country, it can be a sector, it can be a practice. And we are very conscious of the importance of that. I would be very confident, but I can't give you specific examples. I'll be very confident that we have walked away from deals because we weren't satisfied with the track record of the client we're working with. But that's based simply on my recollection, I can't give you a categoric assurance on that.

Okay. Next question is microphone # 3. Welcome back, Michael. I'm going to encourage us all to be brief because I want to make sure we can get on to the other resolutions before people have to go elsewhere.

Thank you, Chairman. We have Michael Sanderson, again.

Just let you know, I run the Chairman's lounge and they're prepared to hold it open if you...

I'm not planning to be in the Chairman's lounge anytime soon. So -- but presumably, that's helpful to you, Michael, based if you got your phone number.

Just another comment. I think people get the impression that I don't genuinely care for banks. I'd like to put that one to bed. My eldest great grandson is called banks. To balance that, my other great grandson who was born on the 15th is called Loki. My question. Media reports say the ANZ engaged Allens after complaints about Ms. Jane Halton's comment on the U.S. Board trip. She referred to 2 women of color as the hope, and that the external review upheld most of the substance of the complaints. She exited quietly with praising statements. When did ANZ first become aware? And what action did ANZ take at the time? If the complaints were upheld, why did ANZ then appoint Ms. Halton to lead Suncorp Bank's Board? Why did ANZ publicly praise her departure without stating any conduct findings or reasons? Did Ms. Halton receive any payment, benefit or agreement exit terms linked to her departure?

So I think there's 3 questions there, I think. One is a question about.

Well, I could put and between them a lot and make it one question.

Yes, I'm trying to make sure I answer them, Michael. So there's a question about an event. There's a question around did we give any special terms? And there was another question in there. But let me get going.

Is there any benefit agreement...

Any benefit or agreement, yes. So look, there was a question about Suncorp. You asked the change...

The question was about Halton's comments and the fact that she's able to exit ANZ without any marks.

If I try and go through the 3 topics that you've raised under that umbrella, look, like any large organization, we have lots of opportunity for people to raise issues, concerns at all levels. We take them very seriously. And as you would have seen from the things I talked about earlier, we have very well-created processes and systems for managing these issues. But because of that, if there was an investigation, I'm not saying there was, if there was an investigation, we are required to preserve the confidentiality of those who may have raised an issue or indeed anyone who's been on the receiving end. So I'm not going to comment either way in terms of confirming or denying whether that happened.

In terms of Jane being appointed to Suncorp, when we acquired Suncorp, as I mentioned earlier, it is one of the biggest banking deals, one of the biggest changing -- changes in industry structure in Australia for several decades, and it transformed ANZ in terms of our retail positioning. But as we've also stated, we needed some time to be ready to integrate it into ANZ. And as Nuno has mentioned, that's scheduled now for 2027. So we currently have a separate banking license for Suncorp. It's required to have its own Board and its own governance. It's a large entity in its own right.

So in selecting someone to chair that, we needed someone who's got a track record of serious governance, who understands and has the experience of running complex operations. And if we looked at Jane, we saw someone who led the Department of Finance and the Commonwealth Department of Health at various times, she has a public service metal, which is a recognition of our capability. And she, as it happens, is the most senior serving director in ANZ on the Board other than myself. So those were the reasons we appointed her to Suncorp. And as you can see from today, we've been very focused on ensuring Suncorp goes well.

There was no special treatment for Jane in terms of her terms and conditions on exit. She did say the 2 reasons that she was keen to go were the fact that she's chairing a global Board that works in public health, and she needed to spend more time on it as the United States withdrew funding and the fact that we were about to sign an undertaking with APRA, and she was due to step off the Board around now. But look, I'll let Jane speak for herself otherwise, but that gives you some background to our decision-making.

I just find it peculiar that you ignore the racial slur and prop up everything else really...

Any issues that raised with us is not ignored. I want to assure you of that.

Okay. I'm going to move this one. And I'd like to acknowledge Mr. Matos, by the way, with his personal commitment to meet with the co fields personally that he made at the HEC committee. I hope he honors that.

So I'm going to encourage you, Michael to get to your question, and that will be -- I've given you 4 at that rate. You get a special treatment.

This is a solution. The Australian Attorney General said that a fair hearing requires a quality of arms where each party has a reasonable chance to present its case. Yet as Senator Paul McLean showed in Bankers and Bastards, justice against a bank is often virtually unattainable because rights become assets that are bought at a price. My aim isn't to attack ANZ, but to help you live up to your commitments to fairness, to vulnerable, small business and farming customers.

So have you got a question...

Once ANZ decides to sue the support is over at that point and only a quality of arms mechanism like a financial services law force can make those commitments real rather than tokenistic. Will the Board support the establishment of a financial service law force? If not, why not?

To be honest, it's not a topic I'm particularly familiar with, so I can't make a commitment.

Is there somebody within the bank? I've pedal this around parliament for 7-odd years. I've got no pushback. Is there anybody in your bank I can speak with afterwards?

I'm sure if you look, Michael, have you already made a submission to us on this?

No, I haven't. I've met personally with other banks. For instance, NAB reached out and we had actually -- I'd like to open that protocol.

To be honest, it's a matter for government, right, rather than for us.

Well, you instruct government, and that I can point you to the document...

I think the last 12 months would show very clearly, we don't instruct government.

Well, I've got a list that says, it's okay, government. You can hold a Financial Royal Commission. So I think you actually...

Honestly, Michael, I think that's a question of national policy and for the politicians to decide. So I think that's probably the best place. And you clearly have your advocacy there.

Mike, I'm going to give other people a chance to speak. Thank you very much. Next is microphone #4.

Thank you, Chairman. Jonathan Moylan, Australian Conservation Foundation, speaking on Item 7.

Welcome, Jonathan.

Thank you, Chair. And it was excellent to see you or hear you in your opening remarks talk about the fact that the bank wants to build its capacity to understand nature-related risks and to understand and conduct greater due diligence on deforestation.

My first question is whether given you've engaged more on this than probably most people in the country, you could explain a little bit more about what the economy's dependence on natural capital means. And given that in the notice of meeting, the bank says that it intends to review its exposure to deforestation, whether there was any reason why the bank couldn't support Resolution 7, which is about the assessment and disclosure of that exposure this year or next year?

You would be better than me talking about the reliance of our country on nature. It's in almost everything. If you look at the supply chains, they all ultimately come back to that. If you look at community well-being and health, it goes all the way back to that. So I reckon -- I'd be wasting my breath trying to talk in the presence of yourself on the importance of nature. What's important is the bank's commitment to try and understand this better and to do a better job.

In terms of the resolutions, we're very conscious of not being seen to be hypocritical or greenwashing. The reality is it's difficult today, both in terms of regulation and data to be confident that you can set a policy and you can stick to it. For example, when we back burn forestry for preventing bushfires, is that deforestation? Should that be included? Different states have got different rules. When it comes to data, we are working with our large agribusiness customers to gather data and to gather with their help, good data on this, but there's a huge sector of small farmers and farming in Australia where data is not gathered. And again, we could be lending to someone there and unwittingly breaching the rules in terms of deforestation. So we have committed to work on this, to develop the database, to develop the policies and to try and navigate our way through the regulation. My hope would be that we're able to get to where we got to on climate within the next few years and to be able to give a similar level of reporting and rigor.

Thank you. Okay. So we have a question online.

I have a question from [ Mr. Ted Leo ]. Full dividend franking. When can the bank fully frank its dividend now that it has fully merged Suncorp Bank's profits?

Thank you. That's a good question. And there was a question earlier about our franking. And our franking ability is based on the amount of tax we pay in Australia. And that in turn relates to how much of our income we're earning in Australia. Because we are the biggest international bank that's based in Australia and New Zealand, then by definition, we have a larger share of our earnings coming from offshore. So 70% today is roughly the percentage of our mix that reflects our Australian earnings. The work that Nuno has outlined in the 2030 strategy is all about lifting the performance of 2 of our businesses in Australia, which we believe will allow us to generate more income in Australia and hopefully improve the franking position. But that's the reason why it is what it is.

Next question is microphone #2, and I think we've got Craig again. Back to you, Craig.

Thank you, Chairman. We have Craig on topic one.

Thank you, Mr. O'Sullivan. I've been a customer, I think you're aware of some of these comments, I'd like to pass through to Mr. Matos at your...

Are they a question, Craig, or are they a statement?

I've only just started, please. Please let me continue my question.

Is a question?

I've got a statement and a question.

Well, I'm going to suggest that you maybe make the statement separately be for the benefit of everybody else in the meeting.

The statement...

I think, that's relevant to the question...

Mr. O'Sullivan, I've been up 12 seconds and you stopped me. This is grossly unfair. My last question was very short.

I have an obligation to make sure everyone gets to say at the microphone.

Mr. O'Sullivan, you gave me 8 seconds before you intervened.

The question is, have you got a statement or a question?

I've got a statement for context and a question.

I'll allow you to make a brief statement and then go to the question.

I've listened to the others, and I'll make the statement as I need, and it is reasonable.

If you don't observe the protocol of the meeting, Craig, I'm going to have to ask you to leave.

Mr. O'Sullivan, I've observed the protocol of the meeting. My last question was...

We've always had a respectful relationship, and I hope we could continue that.

Absolutely. I've been a customer for 50 years, unbroken. That is almost unheard of for customers with a bank. I've had 42 loans. I'm also the founder of Bank Warriors, along with colleagues that are here today and other groups, and we have 20,000 members and followers. Paul talks of tactics that the bank uses. I can only agree with him. The tactics in ANZ are appalling. Long-standing customer complaints, there are too many. The AFCA data cube shows that. Mr. Kalashnikov mentioned that he puts up questions, complaints and they're answered. And I agree with you, Mr. O'Sullivan. You've made improvements. You've got this system going in response to ASIC and APRA, but the actual execution is missing. I made indeed a complaint against Shayne Elliott with you and you accepted it and you lodged it, and I got the auto response and nothing happens after that. It's a failed system. That's why I'm saying I want these to resonate with Mr. Matos. Mr. Matos is refreshing the organization. I welcome Mr. Matos. Thank you for being here. I'm pleased to see the back end of Mr. Elliott.

The root cause analysis that's in here identifies poor outcomes for customers. The reason you're in trouble with the regulators that the other banks aren't is because your customer complaint system is not working. All I'm asking is, I would like ANZ with Mr. Matos to have a customer committee, a committee where the customers can actually help the bank. We can come in with goodwill and good ideas because I can tell you the regulators come in late. It's the customers that are the canary in the coal mine. We're the ones that identify what the problems are. What you need is a customer committee that is not just up at Board level, but it includes someone from customer groups. Will you do that? That's my question. I am finished.

We'll consider your suggestion, but thank you. We'll certainly note it. Thank you.

Can I have a comment from Mr. Matos, please?

Craig, we certainly have already included the voice of the customer in the way we are managing the improvement on customer service. So your suggestion is not only welcome, but it's already incorporated, and I hope it will yield benefits in the future. Thank you so much.

Thank you, Craig. Okay. Next question. And we are hopefully down to the last few because we will need to get on to some other resolutions. Microphone #4.

Thank you, Mr. Chairman. Welcome back Natasha Lee from Sydney, Item #1.

Thank you, Mr. Chair. Very quickly, just inquiring whether -- well, start off again that ANZ is an international bank. Now there seems to have been a bit of a push coming from China to have payments of goods in their currency, the RMB. Is this something which ANZ is looking at doing -- is that part of your strategy to look at that...

Just to clarify, that would be people being able to pay -- I mean, you can do that today, right? You can do a currency transfer today.

No, well, not so much currency transfers. These people -- companies buying goods, so the movement of payments, both exports and imports...

So let's just say I'll buy some [indiscernible] made in China, but I want to import them to Australia. So today, we would help you with that -- with our finance.

We're talking about large purchases.

So we -- globally, there are some countries that already have specific swap lines with -- in RMB, which allow them to do trade finance in other currencies than the traditional dollar. I'm not aware if we are offering that. We'll come back to you on that. Thank you so much.

Now on -- let's see. I noticed that the audit fees have increased significantly, particularly the Australian component of the audit fee. I know that business is more complex than things, but the level of increase does seem to be out of proportion to that. Can you comment or explain why -- basically, the total Australian audit fee went from just under $16 million to just over $21 million last year.

And there's some important reasons for that. Don't forget as well, we've also got Suncorp Bank, which we've now got to cover off as well. But -- okay, Farhan, anything to add that?

That's exactly the main reason. It's the inclusion of Suncorp Bank, which adds to the audit fees. And of course, there is normal inflation.

Right. If I could just do a very quick thing is that on Page 36...

Michael is going to hit me in a moment because I'm allowing you to exceed your quota of questions by a long way.

Just Page 36 and the 116, you showed operating expenses as $12.880 billion. But on Page 109 and Page 96, it's $13.023 billion. Is there a reason for that discrepancy?

Sorry, what was the first page in terms of...

36. You've got operating expenses $12.880 billion. And then if you flip to 107, it shows $13.023 billion.

Flip to what, sorry? What page was the -- second page?

The second page, 107 as well as 96.

I think -- it would be the difference between statutory profit versus cash profit or statutory report versus cash profit accounting. That's where the difference is.

Okay. Okay. Well, that's all my questions on the slot.

Thank you, Natasha. Okay. We've got another question on microphone #2.

Thank you, Chairman. I have [ Moira Caulfield ] for Topic 1.

Good afternoon, everybody. I would like to thank Mr. Matos for agreeing to meet with us at a future date to discuss serious and long-standing issues. My husband, myself and my daughter appreciated meeting you at the Parliamentary House Economics Committee on the 19th of November. My question is, despite giving us your word, shaking our hands, and receiving many e-mails from us, you have not responded. You speak of putting customers first. We have been ANZ customers unbroken for 50 years. When will this meeting take place, please?

My team has clear instructions to welcome you at a point in the future. So I'm honoring my word here in public. Thank you so much.

Thank you so much.

Thank you. Next question is microphone #4.

Thank you, Chairman. I have Peter Stark regarding Item #1.

Fellow shareholders. Welcome, Mr. Matos. Last year's AGM in Melbourne, I asked about what was going on in the dealing room in relation to the bond issue. And you told me there was nothing to see. I'm paraphrasing what you said to me. The Oliver Wyman report, are you prepared to release that full report?

Just to clarify, any comments I would have made last year would have been that we were still investigating and what we had identified were behavioral issues in the Sydney trading room, which we taken account of, but there was still work ongoing. And indeed, the Board had commissioned a lot of -- sorry, Board is receiving a lot of independent work that was underway.

In terms of the Oliver Wyman report, look, we've got an obligation to make sure that we are protecting the best interest of the bank, and therefore, we have to navigate carefully what information we put in the public domain. So we've disclosed a summary. We've been quite open in terms of our root cause analysis. And what's most important is -- we've just had the root cause remediation plan that we proposed to APRA approved by them. And that's fairly voluminous and contains a lot of information, which is all designed to address items that include the findings in the Oliver Wyman report.

I'm aware of that, notwithstanding that.

And by the way, it was -- the report was released on our website when it was originally done.

I did ask at the ANZ head office in Sydney for one of your senior executives to send me the hard copy. I'm still waiting for that.

Okay. It is available on the website, if you look for it.

I did ask for a hard copy. Notwithstanding that, Mr. O'Sullivan, the judge -- the matter in the Federal Court has still not said if he's exactly happy or given that you said the undertakings and everything else. And given that this has happened, not more than one occasion, it's happened time and time again with the regulator having to drag you guys to get undertakings and enforceable undertakings. All that money that the company pays affects everybody in this room that are shareholders in relation to their dividend. And I'm absolutely gods that the Board here never took a pay cut of 25% themselves. CBA and Westpac did when their findings were handed down. And the Board should have stepped up to the plate and taken that.

And is that the question why...

Yes. And two, if it was good enough for the new incoming CEO to say that he wasn't going to take any remuneration or bonuses given to what he's inherited. And to be fair to him, he's inherited this and he's got to fix it. The problem was that the Board let Mr. Elliott get away with things and just either had their head in the sand or whatever, but the mom and dad shareholders and every other shareholder pays the consequences for that because it's that money that goes to pay these fines reflects in the dividend.

Thank you. And I acknowledged exactly that point that you just made in my own comments at the beginning that we're acutely aware of that. There are 3 reasons why the Board has not taken a cut in fees. First one I gave right back at the beginning of the meeting, actually, the Board has been leaning in on this issue. We are the governance people. We don't run the organization, but it is our job to set goals, track performance and when things don't happen as they should to step in, and the Board has done that.

Secondly, philosophically, and I know people have varying views, but a strong view that I hold as someone who's worked in corporate governance for over a decade is that it's a very dangerous game to start putting boards on variable pay. Are you going to pay them more if profit is better this year or less if it's not? Is that going to discourage them from making tough decisions like restructuring the business, which means that you'd actually take a hit this financial year? Could it encourage boards to encourage management to go after short-term unsustainable sources of revenue? Boards need to be independent. They need to be kept a little bit distant from management, and they need to apply their governance independently.

And the final point I'll make is 6 of the 9 Board Directors joined in the last 2.5 years. But having said that, I still believe the Board has acted diligently and proactively on these issues. And I share your disappointment that we've had to pay those fines. That's precisely why we've acted the way we have. And I will add, we haven't forced accountability on remuneration this year. Indeed, it's a subject of a legal dispute. Thank you.

Just one other quick thing. Mr. Matos, I'd like to meet with you after the meeting, please. Can I have a commitment?

Look, I think we will endeavor to mix with shareholders if we can. We just have to check what the time we finish is at. We've already been going now for 3 hours. So it'll just depend and run the time the meeting finishes in fairness.

Okay. We've got a question on microphone #2.

Thank you, Chairman. I have Paul Herman in regards to Topic #1.

Thank you. A question for Mr. Matos. I'm not sure if you are aware that in 2021, UBS did a survey, which found that 55% of ANZ Bank loans were liar loans where information was falsified. There were 6 UBS surveys since 2015. They detected collectively about 500 ANZ liar loans. UBS found in the 2021 survey that 81% of ANZ customers with liar loans said that ANZ staff told them to lie to give false information. That means in 2021, I did a rough calculation, it's about 74 ANZ staff members who told customers to falsify their information on their loan applications.

That's according to the survey.

Yes, according to the survey. That's outrageous if it's true. Will you investigate loans, liar loans and fraud? I have -- in my support groups, I have many ANZ customers where staff forged loan application forms, in some cases, forging signatures. In my case, inflating income by 625%, where both [ FOS ] and AFCA found irresponsible lending. Our experience indicates -- and also some of my colleagues have reiterated those experiences. It indicates a culture of crime at times in ANZ. So my question is, what is the rate of liar loans at ANZ at the moment? And will you meet with me, Mr. Matos, today?

I'm going to take the first part of that question, Paul, and we've been down this path before. I'm not going to comment on the survey or how it's done. I'll simply say that we have very strict policies and strict legal and regulatory requirements about responsible lending, and we observe those very carefully. And indeed, given the survey is now, what, 5 years old or there have been surveys over 5 or 6 years...

It's 4 years here.

4 years. If you have a look at our loss rates on home loans, they're actually traveling below the 90 days past due, is traveling below the level it was in pre-COVID.

We've got a boom in property, which hides that...

As I said, we've got very strict obligations that we observe. So I don't know, Nuno, is there anything you want to add to that?

We are acutely aware of the fact that our policy needs to be strong enough to avoid that kind of misrepresentation of information. And I believe we are getting it right. I believe that data, which I'm aware, it's already updated. And I think we are in a different place. Having said that, as Paul just mentioned, this is part of our priorities on a daily basis. We want to do lending in the right way.

I've had these questions popped off. Since 2020, I think -- because I brought up the question of liar loans, I just think that it's just the denials, I think, are too easy. And I don't believe it. So...

Well, you're entitled to your view, Paul, and we respect it. The facts speak for themselves, and you've heard our response.

Yes. I would like to have a meeting with Mr. Matos...

I'll let Nuno take that on notice and let him decide what to do. Thank you.

I want to go next to a question -- I think we've got a question online, which, in fact, is feedback for all of us in the room and feedback for me by the sounds of it, too. So Clare, did you want to read that?

I have a question from Mr. Stuart Bell and Mrs. Christine Bell. After 3 hours, it is regrettable that what I hoped was to be an AGM has been nothing more than personal grievances and climate change issues. Chairman, 2024 and 2025 has again proven to be incapable of conducting a focused AGM. Surely by the end of 3 hours, voting issues should have been completed, then the majority of shareholders could leave the meeting. I have attended many AGMs, both in person and via Zoom, and AGM for ANZ is indeed a guaranteed bad experience.

Okay. Thank you, Mr. and Mrs. Bell. And that is precisely why I'm asking people to be brief and quick in their questions and comments. So thank you. Let's go on to the next question, which again is online.

We have 2 questions from Mr. Ronald Guy. First question, does ANZ review investment in regard to modern day slavery? Recently, the supply chain of Ansell in regards to Bangladeshi workers in Malaysia who were allegedly treated like slaves with passports withheld, et cetera. There currently is a complaint with the OECD. How far does ANZ go to review such supply chains in supply lines? Woolworths stock Ansell products, for example?

So I'll take that question first. I will let you know, why don't you go -- there's a second question you said?

Second question. Francesca Albanese highlighted certain companies that are allegedly involved in genocide. Does ANZ take these UN rulings into consideration when working with companies that do business with ANZ? Does ANZ actively pursue these public concerns? What is the process for following up such concerns?

So we -- thank you for the question, Ronald. We do screen customers for modern slavery and human rights. We also screen our own suppliers in terms of what we buy. If there are credible allegations, and that includes any case that might have gone to the United Nations, we will look to review those through our policies. We also ask for our customers and our suppliers to disclose to us how they're approaching any complaints or any issues that may have been raised. Thank you for the question.

We've got a question on microphone #4.

Thank you, Mr. Chairman. I've got Grahame Thompson from Canberra. General questions.

Mr. Sullivan, my question is addressed to your inner self. You've either sat up there or stood up there for the last 6 years. And over that period, there's been a continuous almost run of missteps, failures and collapses of your governance, of your Board at the present time, almost personally selected. And my question is, when are you going to retire, seriously?

Thank you for the question.

You must go.

Thank you. And if I can provide some -- thank you for the question and for the critique. If I can provide some balance, actually, there's been a lot of work done by the Board during the last 5 or 6 years to renew the bank. I'm not going to go over all the things that we've done.

Please, don't.

But the bank is in a stronger position today than it was 5, 6 years ago. I will also add that Board Directors are not selected by me. They are ultimately selected by the Board. So thank you for the question.

Fair actor.

Indeed. Next question, please.

Thank you, Mr. Chairman. Back in #4. I've called Rita Majewski regarding item #1.

Welcome back, Rita. I hope you're going to help us...

These microphones are in very...

I hope you're going to help us get on to the next items of business.

I just hope you're going to let me and the others speak, which is a recurring theme today. So in regards to the annual report, Page 30, ANZ defines financial crime risk as a key nonfinancial risk and describes its responsibility to prevent money laundering, terrorism financing, sanctions evasion, bribery and corruption as well as internal and external fraud. The report states the financial crime portfolio is responsible for meeting ANZ's regulatory obligations through its AML/CTF, sanctions, anti-bribery and anticorruption and anti-fraud programs in order to protect customers and the broader community.

These risks are explicitly linked to compliance and conduct risk, resilience risk and operational risk, all of which fairly -- sorry, all which falls squarely within the Board's oversight responsibilities. However, on Page 32, under delivering on the root cause remediation plan, the report states ANZ has an opportunity to improve the way it operates to ensure it is providing customers a simple, efficient and reliable service that meets their needs, keeps its promises and consistently delivers the experience they should expect from ANZ.

My question is, given that providing safe, reliable and compliant services is a fundamental expectation of customers and regulators, why does the Board now describe this as an opportunity to improve only in the context of a root cause mitigation plan? And what does this say about the effectiveness of the Board's oversight of nonfinancial risks prior to regulatory intervention?

Thank you for the question. And I think it's fair to say every organization is always looking to improve. But in terms of non...

yes, but which [indiscernible] ANZ...

In terms of nonfinancial risk, the Board actually stepped in on this, and there was an extensive program, which the Board drove a reset in 2022. That included appointing external examination of why the program was not delivering as it should. It included making changes in the leadership of the program, making changes in the sponsorship, underpinning the investment in new technology to track nonfinancial risk issues and appointing an external party to continue to audit and track performance against it. So that's an example of where the Board has been exercising its governance, has been leaning in and doing its job. And as is clear from the report, we're now focused on the PACT program, which is all about driving a company-wide, a bank-wide uplift in processes and controls.

Yes, I'm just a bit -- well, not a bit a lot concerned. There are significant nonfinancial risks which were outstanding since the end of 2017 when the Royal Finance -- Royal Commission started.

Haven't been...

These have remained ignored by ANZ. So how many significant ones fallen through the cracks?

They haven't been ignored. There's been a program to address nonfinancial risk, the issues around execution and delivery. And as you can see, we have made changes and refreshed the leadership of the bank.

It's been refreshed a few times. It's just not working.

Thank you. Thank you for the feedback, Rita. Okay. I think that was the last question. There are no more questions on this part of the meeting. We'll now move on to the next resolutions.

So we now move to the items concerning remuneration. Item 3 concerns an advisory vote on the adoption of the remuneration report and Item 4 is in respect of the long-term incentives to be issued to our new CEO, Nuno Matos. The words of the proposed motions are now displayed on the screen. To provide you with an overview of both matters, I now invite Holly Kramer, the Chair of the People and Culture Committee, to address the meeting. Over to you, Holly.

Thank you, Chair, and good afternoon, shareholders. You've seen earlier in the meeting or yes, I think it was earlier in the meeting, the status of voting resolutions 3 and 4. We, the Board, particularly seek your support for Resolution 4 as we have full confidence in our new CEO and recognize the importance of having his long-term remuneration aligned to the future delivery of robust performance and risk outcomes. The structure of our rem is consistent with guidance from APRA, which allows for the vesting of these rewards to be tested over a number of years, rewarding great results, but also providing the opportunity for the Board to hold leaders to account when performance does not meet expectations.

We're seeking your approval today to allocate long-term restricted rights and performance rights to Nuno, noting that he was awarded, as has been mentioned a number of times today, 0% short-term award in 2025 at his request to lead by example despite the fact that the issues predated his arrival, and we, the Board, are grateful for this leadership. The long-term award has a combined current face value of $4.69 million, which equates to the sum of 135% of Nuno's fixed remuneration for 2026 and 53% of his fixed remuneration for 2025 as a top-up relating to his time since his commencement with the bank as CEO.

Whether Nuno receives any value from these rights will depend on whether the performance conditions and risk evaluations are met at the end of a 4-year performance period.

But now let me turn back to Resolution 3, the 2025 remuneration report. Prior to today's AGM, we engaged widely with our largest shareholders and with the Australian Shareholders' Association and with the proxy advisers, and we thank them for their consideration and their feedback. We recognize and we respect that there's been a range of views on the Board's decision on executive remuneration this year, many of which we've heard from you today. I must stress that there is no simple formula for determining outcomes.

The Board is obliged to make decisions that are appropriate, proportionate and fair and reflect the Board's thoughtful consideration of a range of multiple factors spanning multiple years. We make these decisions with full visibility to all performance factors, both the positive and the negative. And you heard our Chair talk earlier today about some of the positive and of course, some of the negative. But we have to take those all into account as well as an individual's leadership behaviors and their own personal leadership and management of risk. The report provides detailed information regarding how the Board considered all of these factors, including the application of consequences where required.

This resulted in the Board awarding 0 2025 short-term variable outcomes for our current and former Australian-based leadership team, reduced 2026 long-term grants for 2 of our current executives and the application of Malus to unvested equity for the former CEO and 3 former executives. The application of Malus means that we forfeited the equity that those executives had on foot. This led to executives with the greatest accountability for these matters receiving the most significant impact to their overall remuneration outcomes, particularly the former CEO, who was ultimately accountable.

Now as the Chair noted earlier, these decisions have resulted in just over a 30% vote against our remuneration report and many shareholders have suggested to us, including some of you today that the Board should have gone further. And yet, as you've also heard, we're currently facing litigation on this matter suggesting that we went too far. What's very important is that the structure of our executive remuneration framework allows for consequence management by Boards over an extended period of time.

This means that this year's outcomes do not guarantee in any way that our current or former executives will receive their unvested equity in the future. Rather that the Board will continue to consider the appropriate, proportionate outcomes for remaining unvested equity as or before they fall due and if further information comes to light or if further consequences occur from already known information.

This methodical and considered approach is in the best interest of shareholders, and it demonstrates to our new and ongoing management, particularly during a period of such significant transformation that the Board is prepared to take decisive action when required, but in a balanced and thoughtful way. Thank you.

And with that, I'll hand you back to the Chairman.

Thank you, Holly. Thank you. Okay. So we'll now take shareholder questions on items 3, 4 and 6 being the remuneration and Board-related resolutions.

So I think we had a question, microphone #1.

Thank you, Chairman. We've got Sue Howes from Australian Shareholders' Association.

Mr. Chairman, we applaud the new CEO for proposing he received no entitlement under the short-term variable remuneration plan. We note that all of the regulatory issues that have come to light predate his appointment, and therefore, he has no personal involvement. Nevertheless, he made the sacrifice to lead by example and as a reflection of his commitment to the ANZ team. Given this team approach, did directors also consider making some sacrifice of their director fees given their accountability for the governance of the company and the severity of financial penalties now imposed on the company?

Thank you, Sue. I think I've answered that question earlier, but very quickly. It's a different type of accountability. The question is, does the Board lean in on governance. And I've given you several examples where it did. And when it didn't see the results coming through, it's made changes. And so from that point of view, the Board has been doing its job. I also think, as I said earlier, one's got to be very careful about introducing variable pay for Boards. It may distort their behavior.

So just to clarify, the Board didn't...

The Board discussed what would be appropriate. Next question is, I think, a question online.

I have a question from Mr. Stephen Mayne. Thank you for disclosing the proxy position early, both to the ASX and at this meeting, which allows for a more fully informed debate. Which of the proxy advisers recommended against the Board's recommendation on both remuneration matters and the shareholder resolutions, where minority opposition peaked at 32% on the remuneration report and 22.7% on Resolution 7 related to financing deforestation.

Please don't say proxy adviser recommendations are confidential. It is standard for a Chair to summarize the recommendations and rationale where relevant, and this is not a request to publish the actual proxy adviser reports.

Thank you, Stephen. Look, my understanding is it is not customary to discuss the details in proxy adviser reports. They're not actually our reports, they're proprietary reports provided by another party. Holly has provided explanation today as to how we came to the rem decisions. I'll take on board the rest of your feedback about whether there is some way in which we can summarize some of the output at a future meeting. Thank you.

Next question, please, is microphone #1.

Thank you, Chairman. We've got Paul Fanning from Melbourne with questions on items 3 and 4.

Thank you, Paul. And look, initially, I'll have a question in regard to the rem report, and this may be one direct to Holly Kramer through the Chair. And then there will be an item -- a question on Item 4, which is on [indiscernible] variable pay. First one is I look at -- through the Chair, Holly I look at the 5.3 on Pages 60 and 61, and I ask myself about the STBR. I assume what we see here is what was in FY '25. Given the turmoil, given APRA intervention, are you and probably through the Chair, Paul, happy with what the composition of the STBR scorecard is? And will the scorecard vary for the FY '26 year?

I can start by talking about and saying Holly led a very extensive review exercise of our scorecard, which included meeting with shareholders and hearing their feedback. And the feedback was that people wanted a simpler scorecard made up of fewer items and with clear metrics. And that's why you have the scorecard that we had for 2025. We have again listened to shareholders and made some feedback for 2026, and that includes a significant weighting towards the delivery of our transformation initiatives under the PACT program and compliance. Anything to add, Holly?

I'll just add 2 comments. One is that our scorecard outcome for this year, as you would have seen in the remuneration report, was significantly downgraded with the use of the risk modifier. So the Board has great discretion regardless of the specific outcomes. In an ideal year, they would fall the way they fall based on performance. But this year, the Board took a significant downgrade. There is a change to next year where we had a 15% weight on what we call improving core platform resilience, which meant delivering the transformation of nonfinancial risk.

We have upgraded that program to 25% for next year. That program next year is the PACT program that Paul -- the Chair has mentioned a number of times, and it's both a risk and culture transformation. It's extremely important to the future success of the bank. And so we have upweighted it in next year's scorecard. Thank you for your question.

Paul, you had a question on Nuno's LTVR.

Item 4, Page 9 of the NoM, Notice of Meeting, the third column. The question relates to the 50% LTVR restricted rights and the 50% LTVR performance rights. We are told here that the LTVR restricted rights will be nonfinancial measures. Can you define in more detail what are the nonfinancial measures or metrics? And b, for the LTVR performance rights, who are the select financial service comparator group? Which I assume be financial services companies.

So thanks, Paul. We actually outlined on Pages 65 -- 64 and 65, the process we go through for pre-grant and pre-vest assessment in terms of the restricted rights. And they're principally associated with looking at prudential soundness, risk measures, and we retain overall Board discretion in the event that there's been an event that we think should be taken into account. We do also disclose the group -- the comparative group, and I just can't pull up to hand exactly where it is. If I may take it on notice, but basically, you're correct. It is banking equivalents, which page?

Yes, it is. It's on Page 64 right in the middle of is comparator company.

There it is. Thank you, Holly. Halfway down, Page 64. Bank of Queensland, Bendigo and Adelaide Bank, Commonwealth Bank, Macquarie Group, NAB, Standard Chartered plc and Westpac.

Thank you, Paul. Microphone #3 is back to Michael.

Yes. Thank you, Mr. Chairman. Michael Sanderson with items 3 and 4.

Again. Just a quick comment. Just a couple that rang up and said that people are using the meeting for airing personal things. I don't think that's the case. I think that's a misrepresentation. If you're worried about the length of the meeting, there's always a webcast I can refer to. And if they've got short memory spans, I publish each individual question individually on my YouTube channel.

Thank you, Michael. You've got a question for us?

Yes, I have. I have 2 for remuneration. I've got one for the other one, but Anyway, APRA has forced ANZ to hold an extra $1 billion in capital. ASIC has imposed about $240 million in penalties for widespread misconduct. The union describes ANZ as a banking crisis. ANZ's own material says the Executive Committee still receives about 65% of their target short-term bonuses in the year these problems peaked.

Two major proxy advisers are again recommending that shareholders vote against this report. Is this just a pay framework that rewards a small group at the top while everyone else wears the cost? Can I indeed spell out the exact circumstance in which every member of the Executive Committee would receive 0 variable pay for a year?

Thank you, Michael. Well, in fact, if you go to Page 53 of the annual report, we're outlining that other than some people in acting roles and CEO of New Zealand, none of the Executive Committee received a short-term payment this year, short-term variable payment this year. And we've outlined clearly the way we look at LTVR, long-term variable remuneration. And again, in Holly's letter on Page 53, we show how we have forfeited those rights and applied Malus where appropriate.

So actually, we have been quite active. I would also say this is a bank that certainly has issues it's working through, but it is also a bank that is well positioned for the future. In terms of the acquisition we made of Suncorp, which we managed to get approved despite initial regulatory disapproval. We've recently doubled the synergies we expect to receive from that purchase. The technology choice we made in Plus, other banks are only getting into their technology choices now.

Likewise, in the institutional bank, we've made significant technology gains and the refresh in leadership and the Board that I talked about. So the bank has its challenges, but is also in a much stronger position to create value and generate growth.

Number 2 on the remuneration -- remuneration, sorry, I get that wrong. Now rather than use a complex data to question your very generous remuneration. I've opted for a simple thought experiment to members of the Board. Consider you are one of 6 people on an island. There is a builder, an engineer, a teacher, a doctor and most importantly, a laborer and yourself. What would you offer the other 5 in return for their services? And what would entitle you to an average of 380% more of the island's real resources. The Board has not demonstrated competent oversight. Why shouldn't shareholders view the current Board remuneration as insulated disproportionate rent extraction?

So I'm going to end up repeating a previous answer. Unlike criticism of some other boards, this Board has been leaning into issues, setting clear objectives, agreeing strategy, supporting management in getting there and stepping in when it is -- when management is not delivering and making the necessary changes and enforcing accountability. I won't go over it all again, but this is a Board that's been doing its job and has positioned the bank today with a refreshed team, a refreshed strategy and well positioned for growth.

I think you applied that rationale to the other Board you referred to that come up short as well. Look, I've got one more for the Matos rights. Do you want me to deal with now or sit down and let someone...

Deal with it now because I think we have to acknowledge Michael, I've been very generous with you today.

Well, as I said, to engage with us during the year, you wouldn't get this challenge.

That's your question.

Meaningfully engaged, I mean. Mr. Matos, I don't know whether you picked up [indiscernible]. You're now the [indiscernible] cutter. But at HEC, you look like a dear in the headlights. APRA has imposed a court enforceable undertaking and a $1 billion capital penalty for serious and persistent failures in ANZ's nonfinancial risk and culture. ASIC has imposed a record $240 million penalty for widespread misconduct.

ANZ is cutting 3,500 jobs in the financial sector caused to the banking crisis. The Board plans to give Mr. Matos his full term incentive of $4.7 million and 140,000 share rights. Why should shareholders approve this grant? Will ANZ commit that none of these rights vest while there is any APRA or ASIC penalty or enforcement undertaking in place? And until a truly independent reviewer confirms, the cultural failures are fixed.

The answer, Michael, is no. The way we structured our remuneration program is very clearly outlined. Thank you for your question.

I -- you can give a longer answer. I've got no issues.

No. The answer is no. Thank you. We've had 6 questions from you, Michael. So thank you for your contribution.

Okay. We've got any more questions -- microphone #2. We've got another question.

Yes. Thank you, Chairman. I have Paul Herman with a general question.

Welcome, Paul.

Thank you, Mr. Sullivan. The need to invest in gas is only required if there is not adequate investment in storage. What is ANZ doing to encourage investment in storage?

So we're dealing at the moment with the resolutions on remuneration. Is that relevant to...

Actually, sorry, this was a post -- a question post that. So on remuneration.

So Paul, can you help me understand? So we're dealing with the remuneration report and the remuneration proposals. So I'm trying to find a link between that.

Sorry, I was going to ask a question after the remuneration matters were dealt with. So I'm sorry if I came up at the wrong time.

That's all right. Thank you, Paul.

Can you answer the question later?

No, I'm happy -- if it's relevant to bring it up at the relevant time. Okay. Any other question from microphone #4?

Thank you, Chairman. I have Rita Majewski regarding Item #3.

The November 2025 root cause analysis identified a deep seated cultural and behavioral drivers contributing to ANZ's nonfinancial risk weaknesses, including reluctance to change and a reactive approach to risk management. The question is, how has accountability for the 6 enterprise-wide root causes been explicitly assigned at executive level? And how is delivery against those accountabilities reinforced through performance assessment and consequence management?

Thank you, Rita. And if you look at Holly's letter on Page 53 of the annual report, you can see there very clearly the adjustments we've made to remuneration for various issues through the year. And I think it would be fair to say they're fairly significant. In fact, we summarized the last 2 years, and we express what's been forfeited in terms of remuneration as a percentage of people's fixed salary. And moving forward, as Holly said, we've attached to the scorecard in the year ahead, a significant weighting towards the delivery of our commitments in terms of the undertakings, but also in our transformation plan.

Okay. I'll just do my second one. The ASX Corporate Governance Council sets out 8 corporate governance principles, including effective Board oversight, lawful and ethical conduct, risk management, accurate disclosure and fair and responsible remuneration. Justice Owen in the HIH Royal Commission defined corporate governance as the framework of rules, relationships, systems and processes within and by which authority is exercised and controlled in corporations, including the practices by which that authority is, in fact, exercised.

In ANZ's 2025 Corporate Governance Statement on Page 2, the Board states that ANZ Group Holdings Limited and its subsidiaries have followed the ASX Corporate Governance Council's recommendations throughout the 2025 financial year and that the Board is responsible for the oversight and strategic direction of the ANZ Group through its governance framework, including the Board and its committees.

However, recent ASIC findings and the $240 million penalty for systemic governance values raised serious questions about whether ANZ has, in practice, complied with those principles, particularly in relation to Board oversight, risk management, ethical conduct and accurate disclosure. The question is, in light of these findings, do you and the Board accept its statement of compliance with the ASX Corporate Governance Council's recommendations is no longer accurate in substance. And will the Board commit to correcting or qualifying those statements? Further, given the governance values identified, why have nonexecutive director fees not been reduced as a matter of accountability?

So I've answered a number of elements of that question already, but I would say very strongly, this Board has demonstrated precisely what those principles require. For example, on the issue of cease to states where we are paid a fine, the Board was overseeing management's implementation of a disease to states program, that included hiring an executive from another organization who had a good track record in that area. The program did not deliver fully to the Board's requirements and expectations.

And that's the reason we've ended up paying the fine. So that's an example of where there has been Board governance, and I can go across the other issues as well. The issue is the Board has been applying governance when things haven't been delivered. The Board has stepped in. It has got to the bottom of issues. It has established the facts independently. It has driven change and it has enforced accountability. And that is what those governance principles are designed to do. I would argue that, in fact, the Board has demonstrated strong leadership in terms of its commitment. So I'm very confident we comply to the [indiscernible].

But ANZ has said it's followed those principles, but it hasn't. So in the annual report...

We'll agree to disagree on that, Rita.

If you're Writing in your annual report.

Thank you for your review. Okay. There are no more questions on this topic. So there haven't been a reasonable opportunity for questions on these matters.

We'll now deal with the election and reelection of directors. Details of the experience and profile of the directors standing are included in the Notice of Meeting and the Board, excluding the respective directors due to their own interest, recommends that shareholders vote in favor of the directors' election or reelection. We move first to the election of Alison Gerry. Alison joined the Board in May this year and is retiring in accordance with the company's constitution. Being eligible, she offers herself for election. And Alison will now say a few words. Welcome, Alison.

Thank you, Paul. Good afternoon, everyone. It is a privilege to stand before you today for election to the ANZ Board to serve you, our shareholders. I'm honored to be considered for this important role at a time of ongoing transformation for banks and rapidly evolving expectations among the communities we serve. These changes present significant opportunities for us to innovate, grow and make a positive impact. My 35 years of experience across a broad range of sectors has reinforced the importance of robust oversight and prudent risk management to drive good outcomes for customers and shareholders alike.

In terms of executive experience, I held leadership roles in finance, treasury and risk management for corporates and financial institutions for close to 20 years, primarily in Asia and Australia. Since moving into a governance career in 2007, I've served on a range of Boards, including ANZ Bank New Zealand from 2019 until May this year as well as Kiwibank, NZX, Air New Zealand and Infratil. As Founding Chair of [indiscernible], I steered corporate governance of the online investment platform through a period of significant digital innovation, an area that remains highly relevant for all banks, including ANZ.

Personally, in joining our Board, it's important for me that I have a connection with the company I represent and that our values are closely aligned. Having been a customer of ANZ's retail bank and having worked with ANZ's institutional bankers during my time in corporates, I've had direct experience of what the bank does well and what we need to do better. I've also seen firsthand the key role a bank like ANZ plays supporting the Australian and New Zealand economies, helping everyday households as well as companies looking to connect to other parts of the world.

I know ANZ is committed to making a positive difference to these customers, and I'll be wholeheartedly focused on supporting these efforts in this director's role. I acknowledge the responsibility and hard work that goes into this, and I humbly seek your support. Thank you.

Thank you, Alison. We now move to the reelection of Jeff Smith. Jeff joined the Board in 2022, and he was elected by shareholders at the 2022 AGM. He's retiring in accordance with the company's constitution and being eligible, he offers himself for reelection. Jeff will now say a few words. Welcome, Jeff.

Thank you, Paul, and good afternoon, shareholders. I appear before you today seeking your support for reelection to the ANZ Board. As the Chair said, I joined as a Non-Executive Director in 2022 and have served as a member on several key Board committees, including people and culture, risk, nomination and Board operations as well as serving as Chair of the Digital Business and Technology Committee since 2024. In these roles, I have been focused on supporting ANZ's ongoing transformation during a period of profound change for the financial services sector. I'm a proud dual citizen of both Australia and the United States and have spent a significant amount of time here in Sydney as well as Brisbane and Melbourne. Throughout my 35-year executive career, I have held chief technology and operations roles across various organizations, including IBM, Telstra, Suncorp Group and Toyota.

My focus has been on aligning technology with business outcomes, leading digital transformations and building cultures that can respond effectively to disruption. This experience has given me a deep global perspective and strengthened my firm belief that innovation and resilience are key to long-term success. Since joining ANZ, I've taken steps to ensure I can dedicate appropriate time to my Board duties, stepping away from advisory roles I have with both Box and Zoom. I continue to serve on the Board of Sunrise Security, a leading provider of cloud security and data governance solutions as well as PEXA Australia Limited, a digital platform for online property settlement and lodgement.

Cybersecurity and digital innovation remain key themes across all industries, including banking. This experience, combined with my other Board roles has allowed me to develop a deep understanding of governance, risk management and strategic oversight.

Looking ahead, I am committed to helping ensure ANZ remains well positioned to navigate the rapidly evolving environment. If reelected, I will continue to bring my global experience to the Board, working collaboratively to ensure ANZ remains a trusted and innovative partner for our customers, communities and shareholders. Thank you for your consideration and support as I seek reelection.

Thank you, Jeff. I'll now take questions on Items 2A and 2C, which are the election of Alison Gerry and the reelection of Jeff Smith.

So microphone #1, we've got a question from Sue.

A question to Ms. Gerry, please, from the ASA. Ms. Gerry, given this is the Chair's final term, as a member of the Board and Operations Nomination Committee, what qualities and skills do you believe the next Chairman of ANZ should hold?

Thank you for your question. I have been on the Board. I think my first meeting was perhaps early June. So I am very new to this. However, I think the most important qualities that a Chairperson would have would be have the appropriate skills and experiences, capabilities and particularly the capacity because this is a very all-encompassing role as the Chairman. I would say that Paul has worked every hour of every day on ANZ. He is passionate about making a difference for customers and for shareholders, and that is an important quality for a new Chair. I think we do have around the Board table the right skills and experiences. And so it's something that will be discussed, I think, at a later date, but we are very fortunate to have Paul in this role for another 3 years.

Thanks, Alison. Sue, is there another question?

I've got a question for Mr. Smith, please. Mr. Chairman, a question to Mr. Smith from the ASA, please. A fundamental indicator ASA looks for when assessing a director for reelection is the number of shares they hold in the company. We see this as a demonstration of the directors' commitment and reflects their alignment or skin in the game with shareholders. We note that since your appointment on 1st August 2022, you have acquired 174 shares as part of a rights issue. You hold 2,605 shares on your appointment and therefore, now hold 2,779 ordinary shares. Can you advise the meeting when you intend to commit some of your directors' fees to acquiring more shares in the company, please?

I mean, typically, if I was to answer the question, as you know, there is a period of grace given to directors to make those investments. And Jeff is within that period. I don't know if Jeff particularly wants to answer the question, but he's certainly within his rights to stick with the policy.

My intent is to keep within what's required and to buy additional shares. So I do intend to do that.

Okay. Thank you, Sue. Got a question from Michael on microphone #3.

I noticed Vince and Peter is still running the country over there. Ms. Gerry, I was just going to pronounce that, Gerry, but it's wrong. Your own ANZ bio notes that you have been a Director of ANZ Bank of New Zealand since 2019. You now sit on this group's Board Audit, People and Culture, Digital and Nomination Committees. Over this period, ANZ has been hit with $750 million APRA Capital Overlay for persistent failures in nonfinancial risk management. ANZ has entered into an enforceable undertaking after the Oliver Wyman review uncovered serious deficiencies in risk governance and culture in the global markets business. Given you are already in the tent as an ANZ director while these failures developed, why should shareholders believe your election represents genuine Board renewal rather than recycling the same governance that presided over these problems?

And I think to be clear, we've talked a lot about some of these issues already, Michael, but ANZ New Zealand is required to operate with a degree of autonomy and independence in order to meet New Zealand regulatory requirements. And in that sense, Alison has not been involved in any of the issues in Australia that you mentioned. If we look at the performance of ANZ New Zealand, I think I mentioned in my speech, it's actually been a very strong performer for the bank. If I recall, the CAGR of net interest income we're getting in New Zealand is something like 7% over the last 5 years. It's certainly a standout performer in terms of a local market. So I think Alison's experience in working on the New Zealand Board is something that we value, and she was not involved with issues that are associated with the group Board.

This is unrelated. I just want a quick response on this. As shareholders, me, am I able to access the Wyman report? I'm not asking...

It's on the website. It's on our website.

It is the whole report?

That's my -- yes, my understanding, yes.

I'll have a [indiscernible] of that. Mr. Smith, you're Chair of ANZ's Digital Business and Technology Committee and a member of the Risk Committee. You have overseen a period where Australians are losing billions to digital scams. ANZ has suffered repeated app and online outages. ANZ is closing branches and pushing regional and vulnerable customers on to unsafe, fragile digital-only channels. You also sit on the Board of PEXA, a near monopoly digital settlement platform with a history of outages, which ANZ is a major customer and user. ASIC is seeking a $240 million penalty for nonfinancial risk failures in this area -- in areas tied to this technology and systems that your Digital Business and Technology Committee oversees. With ANZ forced acceleration into digital, bank branch closures and reduced cash access, why should shareholders trust your judgment? You also live in the United States and hold multiple roles there. Is ANZ just a side gig for you?

So if I can initially answer those questions, Jeff's actually made a very important contribution to some of the issues we talked about. It was his technology background and knowledge that helped us assemble the people who did the strategic review of our ANZ Plus technology that concluded it is very much fit for purpose, but that we needed to change the way in which we're implementing it. Jeff has also been a key adviser to us and other major technology projects. For example, we are a leader in payments and cash management in Australia. In fact, we've added $60 billion to the amount of payments that go through that business in the last 5 years, and that we believe we've got a technology lead in that area. He's also clearly in a position to help us with the major transformation and technology underway in New Zealand.

That's, of course, along Jeff's general contribution to the issues I've talked about, such as the Suncorp acquisition, the refreshing of the Board. In terms of branches, the reality that every bank faces in Australia is that there's been an almost 80%, 8-0 percent decline in transactions undertaken in branches over the last 5, 6 years. In fact, 96% of transactions today are done outside of a branch. Only 5% of Australians actually rely on a branch for their banking. We understand how important they are, and we've given a commitment not to close regional branches or to close Queensland branches for a period. But this is an industry issue we have to face, and I don't think you can hold Jeff to account for those activities.

Jeff is based in the United States, but he also has spent -- he has worked in Australia. He has family in Australia. He is an Australian citizen. And part of his commitment to joining the Board was that he would spend considerable time here, and he does as witnessed by his appointment to the PEXA Board. He's a real asset for the bank. Most banks are now realizing that financial services is a technology arms race. And having a Board member with a deep background in technology is very important. So we are very appreciative of having Jeff on the Board. Jeff, is there anything you wanted to add to my response?

No. Just to reinforce, I am committed to ANZ in supporting. I made 9 trips last year for all the Board meetings. I have a son that lives here and we have interests here. So I think for me, you're getting a commitment to also bring technology expertise from the U.S., which happens to be where we source a lot of our technology from.

I should add -- sorry, Mark, I should add, of course, that we get a free kick because he's based in the United States. So Jeff's got an involvement in a number of significant circles in the U.S. on technology. So we actually bring that knowledge to the Board. And the last bit I just wanted to mention briefly, of course, anyone we appoint to the Board has to go through a fit and proper assessment. And so regulators have the opportunity then to ask any questions about their appointment. So everyone who we appoint to the Board has been through that process.

This bank wouldn't have any issue then with supporting a public bank that established real branches through the post office footprint?

We've actually recently made ANZ available at Bank at Post actually as part of the response to your question. On national policy issues, Michael, I'll defer to your advocacy in Canberra. Thank you. Okay. Next question is microphone #4.

Thank you, Mr. Chairman, reintroducing Natasha Lee, 2(a).

Welcome back, Natasha. I hope you are going to get to the question quickly for me.

I thought I was getting to the question fairly quickly. Not specifically concerning Alison. I think that there's an issue that you've got candidates which sort of look good on paper, but I feel that some of the shortcomings, which have happened and which have been raised by shareholders, even though you've, to a certain extent, cited them is because of the lack of diversity and particularly life experience. So I think that if the Board appointed will look to qualify people from a wider range within the community to better reflect the makeup of the Australian community, then potentially some of these problems, which arose would not have done so.

Thank you. And obviously, I disagree with your characterization. I believe the Board has faced into these issues in a way that many boards in Australia have not. But having said that, I take your point, which is that it's important to have diversity on the Board, and that is certainly something we are keen to get.

Right. That's what I'm asking for.

Okay. Next question, we've got a question, I think, online.

I have a question from Mr. Stephen Mayne. Jeff Smith, question. We seem to have a very diverse Board and senior management team in terms of having offshore experience. Dual citizens can't serve in the Australian Parliament. Do any of our regulators such as APRA, ASIC and the RBA have a view as to whether a major Australian financial institution like ANZ can and should be led by noncitizens or dual citizens?

Thank you, Stephen. And the answer is very similar to the last 2 questions ago. But we do believe, to the point Natasha made that having a diverse Board is a good thing, certainly being able to tap into other sources of background and information. And as I said, the regulators have an opportunity to ask questions about our appointments because our directors go through a fit and proper process. And I'm not aware of any concerns about dual citizenship with the regulators. Thank you. Back to microphone #4.

Thank you, Mr. Chairman, reintroducing Peter Stark for 2(a).

Thank you, Chair. Just a quick clarification. It says there in relation to Alison that she was on the ANZ Board.

In New Zealand.

In New Zealand, she has resigned from that?

Yes. Yes.

Okay. And just quickly, just in relation to Mr. Smith. You said I believe he's an Australian citizen.

Correct.

And does he also hold U.S. citizenship as well?

Yes. Yes, he does.

No problem. Thank you.

Thank you. Okay. Have we -- I think we have -- we have another question in the microphone #4.

Thank you, Mr. Chairman, reintroducing Rita.

Welcome back, Rita.

Mr. Smith, just in regards to your digital business technology and risk management roles, on Page 30 of the annual report, it states we maintain a financial crime management program that anticipates and navigates criminal threats and the financial crime portfolio continues to be responsible for ensuring that ANZ meets its regulatory obligations through its anti-money laundering, counterterrorism financing, anti-fraud programs and policies amongst other things. This allows ANZ to deliver detection, investigate and intelligence capability focused on identifying, mitigating and managing financial crime to help protect the community. Could you please tell us, whether it's you, Mr. Smith or the Chair, what powers does ANZ have to investigate fraud internally and also episodes externally to the bank on its customers?

You mean legal powers or you mean capability?

No, powers. There's a difference.

And to be fair, this is really a question about director reelection. Can you tell me how that's relevant to Jeff's...

Well, it comes under risk management and the financial crime portfolio and managing it through the risk management process, and there's a lot of scams through technology and everything. So I thought it would be appropriate for Mr. Smith. So given that there's a lot of self-assessment, self-reporting, self-investigating, what powers does the bank have to actually investigate fraud legally?

And why is that relevant to Jeff's reelection?

This is extremely relevant.

Can you link it for me, Rita, I'm happy to answer it if it's relevant.

As I said, I've asked this question because of him sitting on the Committee for Digital Business and Technology and Risk Management, which nonfinancial risks and financial crime come under.

Look, I'm going to give you a very quick answer, but frankly, the question is not relevant. But in terms of the initiatives the bank has done, yes, we have -- where we're allowed by law, we work quite hard to identify fraud. We run a number of algorithms internally to look for unusual patterns of behavior, and we have been recognized by AUSTRAC as an organization that is at the forefront and is very proactive in working to identify potential sources of financial crime. And in terms of ourselves, we've worked quite hard to deliver the payee confirmation, which has been worked across all the banks. That saved 300,000 payments, which were canceled by customers over the last several months as a result of seeing a mismatch. I could go on, but honestly, in terms of the power we have, we obviously have a power to investigate, which we exercise appropriately, but there's a certain point at which we have to operate with law enforcement, and they're the ones that have the ultimate authority.

So are those powers given through the Corporations Act?

When you say power, I'm interpreting it as what capability have we got internally to look at things, and we look for patterns which are unusual, and we see our obligations as being important in terms of spotting unusual transactions.

Sorry about that.

Honestly, after that, Rita, I just don't know...

I just wanted to ask, so just what you said just before, just to clarify. So with instances of internal or external fraud, do you actually involve Report to the police and get the police involved?

If we identify a suspicious transaction, we are obliged by law to report it to AUSTRAC, correct.

And the police.

It will be the decision on when to involve the police, as I understand it, is a separate matter. It depends on the nature of the initial findings.

Has the bank done that in the last 12 months?

I can't answer, but Rita, I'm pretty sure they would have.

For any matters?

But again, how is this relevant to direct Jeff's reelection?

Because I'm an owner of the bank, and I'm asking.

I'm sorry, Rita, I've given you plenty of time on that. I have to make sure the meeting stays on track. So I think we've answered that.

I just note for the record that that's not a proper answer.

Thank you. Thank you, Rita. Okay. Let's move on to Item 2(b) because we have no more questions on that. So we now move to my reelection as a director. I'll say a few words, and then I'll ask Christine O’Reilly as our most senior serving Executive Director, to chair the meeting for the session. So if I can talk a little bit about why I believe why I'm seeking your support. It has been a privilege serving as your Chair since 2020, and I'm certainly honored and aware of the privilege I have in being able to put myself forward today for reelection. Since joining the Board in 2019, I've worked closely with my fellow directors and the management team to strengthen our bank while preparing ANZ for the challenges and opportunities ahead.

And as I've said earlier, a key focus has been ensuring a successful change in the leadership of the bank with the appointment of ANZ's new CEO, Nuno Matos. And I'm confident he is taking the right steps to position your bank for long-term sustainable growth. In addition, the Board has worked with Nuno to deliver renewal in the executive leadership team with 4 new internationally experienced executives joining the ExCo team. The Board itself has undertaken significant renewal. 6 of the 9 non-executive directors who are before you on the combined bank and group boards have joined since 2023.

Beyond my ANZ responsibilities, I serve as the Chair of a government business entity called the Western Sydney Airport Corporation and a nonprofit entity, St. Vincent's Health Australia. My professional experience spans leadership roles across the public, private and not-for-profit sectors, including serving as CEO of Optus from 2004 until 2012 and later as the CEO of Singtels Group Consumer. My time leading large organizations and serving as a non-executive director has provided me with deep experience in governance and a clear understanding of the importance of creating sustainable value for shareholders. Looking ahead, if reelected, my priorities will be to support the Board and the management team in the transformation program that Nuno and I described in our opening remarks.

Another key priority is to strengthen the Board by bringing in additional retail and commercial experience. And very importantly, I am committed, picking up on the earlier question, to ensure a smooth transition to a new Board Chair during my final term. As I've indicated, I firmly believe ANZ is well positioned for the future. We have a highly capable team led by Nuno. We have a clear refreshed strategy in ANZ 2030 and a strong commitment to do the right thing for our customers while delivering ongoing value for you, our shareholders. I acknowledge the responsibility that comes with the role, and I respectfully ask for shareholder support as I seek reelection as Chair of the ANZ Board.

Thank you. And as such, I'll now ask Christine O’Reilly to chair the meeting for this part of the meeting.

Thank you, Paul, and good afternoon, everyone. I'll now invite shareholders to ask questions on the Chairman's reelection as a director.

And I think the first question is from Sue Howes. Sue?

Thank you. I would like to ask a question to the Chairman. As this is your final term as a director of the company, what are your 3 priorities over this coming period?

Thank you, Chair. So obviously, to support Nuno in delivering on the transformation that we have committed to; to ensure that the Board has the right mix of capabilities and directors; and to ensure a smooth transition to the new Chair.

Thank you, Sue. And our next question is online, Clare.

I have a question from Mr. Stephen Mayne. Is the Chair intending to serve a full 3-year term and retire as Chair after the 2028 AGM? Does the Chair believe the next Chair is currently serving on the Board? Have we retained a recruitment firm to assist with the Chair succession process? And will the search extend to individuals not currently serving on the Board? Westpac Chair, Stephen Greg, told his AGM last week that Westpac has the most banking experience on its Board out of the big 4 banks. Does our Chair agree with that assessment? And where does he think ANZ currently sits in the rankings on that metric?

Thank you, Chair. I'm going to give Stephen the Michael Sanders prize for multiple questions in one. So let me try and work through them. I have said in my letter in the annual report that my goal is to have a smooth transition to the new Chair during my term. And in other words, that I don't plan to stay until the very last day. In terms of the process, actually, the way the process works is that the Board establishes a committee who oversees the search, and they will decide on the recruitment firm that is used for that. We do have a recruitment firm currently who do extensive work for us on building a pipeline of candidates who could serve on the Board with the right qualifications.

Yes, I would expect, but it is the Board's decision that the search for a new Chair will extend to individuals not currently serving on the Board, but it will, of course, consider directors who do sit on the Board. In terms of the Board makeup, I think I've flagged that we do have an experienced Board, but I think I've said publicly that our commitment is to add additional retail/commercial experience to the Board moving forward. And I'll probably leave it at that.

Thank you, Paul. And we have another question from Stephen, so maybe don't sit down just quite yet, Paul. Clare.

Another question from Mr. Stephen Mayne. Paul O’Sullivan reelection question. How many of ANZ's circa 450,000 shareholders voted in favor of Chair Paul O’Sullivan's reelection by proxy and how many voted against? If even gambling company, Betr and Myer can voluntarily produce this sort of proxy voting data at their recent AGMs, why can't ANZ? Computershare runs a share register, and they published the headcount data in the poll results after its own AGM. So will we request the same data from Computershare and include the headcount data when releasing the poll results to the ASX later today? You've got the data, so please let the sun shine in on the sad fact that less than 3% of your shareholders will participate in voting at today's AGM.

Thank you, Stephen. The answer is that we don't share the number of shareholders. We disclose the number of votes cast as the law requires, but not the number of shareholders that cast them. So -- and the next question is from the floor, Mr. Sanderson.

Yes. Thanks again. Surname correct. It's not Sanders. McDonald Gary. We do make Vat 69 whiskey, I believe.

I do apologize, Michael, if I got it wrong.

Accepted. We won't go to dispute over that. Mr. O’Sullivan, media reports say that ANZ hired Brunswick including Pru Bennett to contact major shareholders and proxy advisers ahead of your reelection. The Australian Shareholders' Association recommends a vote against your reelection. Will you disclose the Brunswick contact today? Who approved it? What was its mandate? What was its start and end dates? What was the monthly retainer? What was the total budget? Is there any fee tied to voting result or vote percentage threshold? I have heard $55,000 a month and a $100,000 success bonus. Will you confirm or deny those figures? Will you state the total cost to shareholders of this reelection campaign?

Thank you, Michael. And I think it's important to characterize Brunswick's role. Brunswick, who advise a number of the ASX top 100 companies were brought in to help us with our wider investor relations program. There were a number of things they did. They help us with an investor survey to understand what are the issues that are important to investors, what are the concerns that we need to make sure the Board is taking into account. And that's a very common practice across industry. And we also had them assistance. We've done some reorganizing in our investor relations team. And Pru, you mentioned is a very experienced investor relations person, and she's been there to provide some support to the team as we made those changes.

I think we have disclosed that we did have an arrangement with them, which included the fact that there was a performance goal that was set in terms of helping us explain our remuneration and getting support for the remuneration report. But as you can see, that report hasn't succeeded today. But beyond that, I don't think I'm at liberty to release anything else other than to say there was no incentive tied to my reelection.

Okay. My question was specific to your reelection, not the big picture, but I'll accept that at this point. Lucky last one all over. Mr. O’Sullivan, you approved Ms. Houlton's appointment to the Chair of Suncorp Board. At the time, ANZ had serious complaints about her conduct. Why did you still back her? What checks did you do? Did you disclose the compliant findings to the Suncorp Bank Board before the appointment? Did Ms. Houlton's exit from ANZ involve an understanding benefit or trade-off link to future -- to a future role? Will you publish the approval chain, the minutes and the conflict checks for her Suncorp appointment?

I think the broad answer, Michael, will be no. I think I answered earlier the rationale for appointing Jane. I think I've also pointed out through the meeting that we have very formal and independent processes. If there are any issues that are identified, and I'm not saying there were, but if there were, it would have gone through a very formal process. Those are confidential because if there was an issue and someone raised it, we need to protect the individuals involved. And I think I explained this is a big bank requiring someone who's got tremendously -- tremendous experience and knowledge about how to handle large organizations, and Jane's background and qualifications made her appropriate for that.

So somebody that was the help would have no chance of getting on to your Board.

Well, I think the fact that you've got a migrant like me who arrived here 35 years ago without a job and that someone like me can get on to the Board, it shows you that the help can get there. And I have certainly worked my way through organizations from the bottom.

Okay. Well, that's me for today. Thank you very much for your patience.

Thank you.

And we have Mr. Fanning.

Through the Chair, and Paul, this is a question for you. No doubt in recent years, you have had a torrid time as the Chair of the Board. I don't envy your time and effort and dedication you've put in. Could you, in hindsight, have identified the regulatory issues in the nonfinancial issues of the bank earlier on?

So it's a good question, Paul, if I'm okay to answer, Chair. It's a very good question to ask. And as I describe the role of a director and of a Board, we don't run the company day-to-day, but we set the objectives. We agree the strategy of management. And then we try to help management with advice, and we monitor performance. And the balancing act, the tight rope you walk as a director is always, on the one hand, wanting to be supportive and offer assistance. And on the other hand, deciding when is the time to call it to say it's not going to happen. We need to make a change. That's the challenging bit. And in hindsight, you'll always ask yourself whether you could have moved earlier or whether you move too quickly. And I would doubt that you would meet a nonexecutive director in Australia today who wouldn't share those observations.

Other than that, what I would say is the Board was leaning proactively into these issues. We were proactively leaning in nonfinancial risk. We were proactively leaning in on disease states. We had assurances that were given to us in terms of a hardship. We proactively leaned into our markets. So the Board was very active and proactive in leaning in on the issues. The question would always be, in hindsight, what's the right timing?

Okay. Look, congratulations on the job well done. And the second part of the question is relates to 10.1.2, Page 88. And Paul, you did address it before, but I would have liked to put a little bit more meat on the bone. What is the specific policy for NEDs to acquire shares after joining the Board? I mean, is there a time period? Or is it so many shares per year? Or is it X percentage of the directors' fees? Can you just perhaps enumerate that for us, please?

I'm trying to find it's actually stated somewhere in the annual report.

I'm looking at Page 88, but...

Basically, it's -- there's a period of time, I think it's 5 years in which directors have an opportunity to acquire sufficient fees that reflect their fees. And in my case, I've got to get to -- I can't remember the exact percentage, but I think it's 100% of my fees that I've got to cover. As you -- it's not in the report, but I recently sold down -- when I finally had an opportunity to trade, I sold down my capital notes and then reinvested in shares. And I've also recently invested my net fees for being a Board Director and Chair into shares. And I've given a commitment that moving forward, I will invest every period that I'm paid my net fees and buy ANZ shares, and I will hold them until I finish my tenure as Board Chair. So there's very strong alignment with me and all other shareholders.

I'm glad you -- Paul, you set an example for other Board directors.

Thank you, Paul.

Thank you. And we appear to have another question from Ms. Mazalevskis.

Chair, since 2016, ASIC has taken 11 civil actions against ANZ, most recently, the $240 million penalty for serious misconduct. You only left Optus, a subsidiary of Singtel in August this year, towards the end of August, I think it was. While you were Chair of Optus, a major systems failure in November '23 left around 10 million customers without phone or Internet services, including 2,100 people unable to make Triple Zero emergency calls. Australians were assured it would not happen again, yet subsequent outages did occur.

The Bean Review made 18 recommendations and Optus declined to clearly confirm which had been implemented instead promising its own independent review. Across both ANZ and Optus, we see repeated failures in systems, controls, transparency and customer protection while you have been Chair of both companies. My questions are, how can customers and shareholders be expected to trust assurances of accountability and culture change when leadership remains unchanged? And do you accept that remaining in your role under these circumstances undermines public trust and falls short of the standards ANZ's customers and investors and Australians reasonably expect?

Thank you, Rita.

I don't think it's appropriate for our Chairman to be talking about Optus in this meeting. We are talking about ANZ. I do appreciate your question was broader than that. I actually do think Paul has addressed a number of those issues already in this meeting. But I don't know, Paul, if there's anything you want to add.

Just to add that I think you're conflating 2 quite different things. And when we talked before at AGMs, the Optus role was in an organization where the equivalent Board to this was actually the Singapore Singtel Board. I was not a member of that Board. My role was largely advisory and to be an escalation point for government issues in Australia. That did change in early '24, and I helped Singtel and Optus set up the local governance prior to stepping off shortly later. So a lot of the issues you raised actually happened under a different governance model.

Yes, but your role was Chairman. Okay. I'll just ask my other quick one. Earlier, Chair, you said that you do get complaints and you do normally follow them up. At last year's AGM, you asked me to e-mail you directly regarding my unresolved matters, which I have done, yet I've received no response. Instead, I was advised by ANZ customer resolution that any further correspondence on the matter would be filed without response. Can you explain what governance or escalation process applies when a shareholder follows a direct request from the Chair and receives no acknowledgment or response and how the Board satisfies itself that such matters are handled appropriately? Now in total, there's about 8 or 9 e-mails that you haven't responded to. I feel like I'm being ghosted in other words.

Okay. Thank you, Rita.

Could I have a response?

So I did pass on your queries, and I did ask the team to brief me and the response, which is what you got, was that these issues have already been well examined and ventilated.

No, I've already explained that it was through ANZ management fraudulent documents.

Which is your view and the view of our expert team...

It's not my view, it's your documents.

The expert view of our team is different, and that's why they...

Chair,if I'm making that statement you're making yourself and ANZ complicit in the fraud of my loan and my matters. Do you not understand that?

Can I finish answering the question, Rita?

Well, can I finish because you've been cutting everyone off all day. So please have the decency because you destroyed our lives, not just me, not you, ANZ, there has been underhandedness, wrongdoing and fraud within the bank, which we need to do a push to have a Royal Commission because it's not being investigated and there are very long-term long-standing customers who are victims that you refuse to acknowledge your help. I've had shareholders today come up to me today and say, why don't they fix your matter? Why don't they meet with you? Why don't they address what's happened? And I said, well, you go and ask them.

Well, if I can...

And we have to come year after year. So...

If I can respond, Rita. I would say I was officially concerned with your statements that I did ask to be briefed and I asked them to look at it. The feedback was it has been well examined, well ventilated that you have actually been through a number of processes. And therefore, the response you got was an honest answer from ANZ, which is we've exhausted all our avenues of inquiry.

[indiscernible] it's very rude to cut me off.

So I think you've made...

I've also asked to meet with Mr. Matos and I'm waiting for a response to that e-mail as well. You are highly refined fraud and it is very negligent to not at least meet with me so I can present the actual facts to show you what your bank has done.

So I'm actually going to cut this off now. We have given you an adequate forum. I just have to listen to Paul if he says he's examined the facts. I know him to be a person that will have examined the facts, and it's not appropriate that we speak about a personal matter. So there are no more questions. So Paul, I'll hand back to you.

Thank you. Thank you, Christine. Okay. Having dealt with all the formal matters of the meeting, the ability for people in the room to vote via their smartphone will close in 1 minute. For anyone in the room using hard copy voting cards, can I please remind you to sign them and give them to a Computershare representative before you leave today, and you can see them moving around with the boxes. This concludes the formal business of the meeting. Final results of the resolutions will be announced via the ASX as soon as possible. And on behalf of my fellow directors, I thank you all for attending this AGM and for your ongoing interest as shareholders of ANZ. Subject to the finalization of the poll, I now declare this AGM closed, and I wish you all the best for the festive season. Thank you.

All right. Good morning, everyone. I'm Kylie Bundrock, ANZ's Head of Investor Relations. Thank you for joining us for our strategy update.

On behalf of all of the ANZ speakers, I would like to acknowledge the traditional custodians of the land on which we meet today, the Wurundjeri People of the Kulin Nation. I pay my respects to Elders, past and present, and extend that respect to Aboriginal and Torres Strait Islander peoples joining us today. I recognize their enduring connection to land, waters and cultures.

You will have seen that the relevant materials were lodged this morning with the ASX and are also available on the ANZ website in the shareholder center. A replay of this presentation, including the Q&A, will be available on our website shortly after the session concludes. The discussion presentation materials and the presentation itself will contain forward-looking statements or opinions. And in that regard, I draw your attention to the disclaimer in the front of the slide pack. Our CEO, Nuno Matos; and CFO, Farhan Faruqui, will present for around 45 minutes. After that, we'll go to Q&A in the room. With that, I'll hand over to Nuno. Thank you.

Thanks, Kylie. Good morning, everyone, and welcome. Thank you so much for joining us this morning. I'm going to do an exception today. As you will see, I will allow more than 5 slides on the presentation. I hope you will forgive me for that. Let's see how it goes.

All right. So today, it's an important date for ANZ, for our customers, our people and our stakeholders. The purpose of today's session is to update you on ANZ's strategy for the next 5 years and set a very clear ambition for the future of the bank, ANZ 2030. This includes our immediate priorities, which are already underway, as well as our broader areas of strategic focus out to 2030. I will then hand over to our CFO, Farhan Faruqui, to cover the financial section of today's presentation before wrapping up and taking your questions.

To help set the scene, for our strategy, I want to share my thoughts on the Australian banking sector and ANZ's position in the market. First, some reflections on my early days as CEO of ANZ. It has been nearly since a year since I was announced in this role and just over 5 months since I started. In that time, I have spoken with many of you and reflected on your feedback and insights. I also have met thousands of our people, hundreds of our customers, many of our regulators and a range of government leaders. I have spent time in our key markets across Australia, New Zealand, Hong Kong, India and Singapore, while carrying out an extensive strategic review across the bank. This has helped me develop a clear view of our business and our position across our markets, the strength of our franchise as well as the opportunities and the areas for improvement to realize our untapped potential.

During this time, I announced 4 new members of the Executive Committee, who, combined with my existing strong leadership team, are the right people to deliver our

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Decisions have helped me clear the path for the future. To help set the scene for our strategy, I will now share some of our reflections on the industry. Banking in Australia and New Zealand, it's highly competitive with a 30% decline in returns across the major banks over the last decades. The Australian market, in particular, is operating in a highly commoditized way, will limit the differentiation among propositions, few value-added services such as wealth management offerings, and an increasing level of disintermediation. It also has a much higher reliance on net interest income at more than 80% of the industry bank's operating income compared, for example, with 50% of the major banks in the U.K. or Canada. There is also a high reliance on third-party distributors relative to many other markets.

In parallel, Australia has also some of the highest bank capital requirements in the world, which sets a higher bar to deliver returns to shareholders. Having said that, the Australian market offers great opportunities. It's a large market with a growing population and customer base, a stable economy and strong governance. The stronger asset quality and higher capital requirements for Australian banks support better ratings relative to our global peers. This allow us to be competitively positioned in terms of our customers trusting us with their payments and cash management needs. Within this competitive landscape, I'm absolutely convinced ANZ has the portfolio and potential to deliver better outcomes for customers and strong growth for shareholders.

With 197 years of heritage, today, we serve 8 million customers in Australia retail; 700,000 customers in commercial; and we have 30% market share in New Zealand. We are the #1 bank in New Zealand, the #1 institutional bank in Australia and New Zealand, and we have a global footprint across 29 markets. We are and have a fantastic combination of 2 scale markets, 2 market-leading positions in Institutional and New Zealand, and a well-diversified business model, which includes Asia, the fastest-growing economic region in the world.

Well executed, this combination is certainly more powerful than a single market or single segment concentration. We have 4 divisions, and we have the right strategic perimeter. And we are the banking -- we are banking the right customers and the right segments in the right geographies.

Now 2 divisions have performed consistently well: Institutional New Zealand with solid returns and contributing to around 50% of the group revenues. However, and to be clear, the other 2 divisions, Australia Retail and Commercial, have underperformed. In these divisions, which at industry level represent around 75% of the revenue pool in Australia, we see a significant opportunity to grow, materially enhance our returns and deliver better to our customers. In addition, our company, overall, has become too complex. And at times, disintermediated from our customers, and we clearly need to improve how we manage our nonfinancial risks. I am fully committed to driving the changes required to significantly simplify the organization and see all 4 divisions performed well and deliver material growth in line with their potential.

This is our time to deliver and we are excited to execute our ANZ 2030 strategy. Our ambition is for ANZ to unlock our potential to win the preference of customers, shareholders and the community. Our strategy is focused on 4 strategic pillars. Number one, customer first. With market-leading differentiated and superior propositions, we will raise the standard of every digital and human interaction for our customers. Number two, simplicity. To set the market standard for productivity, we will deliver organizational simplification, divest noncore assets and improve efficiency. Number three, resilience. Leading the industry in trust, safety and risk management, we will adhere to the highest standards of nonfinancial risk and strengthen end-to-end accountability across the bank. As a consequence, number four, delivering value to sustainably improve our financial performance, we will create lasting value by delivering a higher return in growth and results that matter for our stakeholders.

In delivering these priorities, we are supported by our core enablers, culture, our people and our technology. Today, I'm laying out this in 2 clear phases. The first phase across '26 and '27, it's about delivering on our immediate priorities in order to get the basics right, including a substantial improvement in productivity and initial investment for growth. In the second phase, beyond '27, we will realize the benefits of these strong foundations, accelerate growth and outperform the market. Very important, in both phases, since day 1, we will continuously improve our returns and deliver value.

I will now move into the first phase of our ANZ 2030 strategy, which is comprised of 5 immediate priorities, which I expect to be at the forefront of your minds. My first immediate priority is to embed my new leadership team, and together, we will continue to drive a cultural reset. Having the right people and the right culture are key to executing our strategy. I have announced 4 new leaders joining my executive committee, bringing significant global and local experience, complementing well the existing bench strength. My team has the mandate to execute our strategy at pace and to continue to promote a culture reset. We are building a culture of clarity, decisiveness, self-awareness, execution and accountability; a culture based on talent and performance that focus on customer needs, promotes healthy and sustainable ambition, external competitiveness and a desire to outperform while ensuring compliance with no shortcuts. It's about pursuing a culture that attracts both those who seek excellence and those that engage with the bank. Our culture will become the biggest selling point for attracting and retaining talent. Our people will know they are part of something special, a journey to become the best bank for customers and shareholders in Australia and New Zealand.

Our second immediate priority is to bring forward the integration of Suncorp Bank to accelerate creation for our shareholders -- value creation -- to benefit our customers and to significantly reduce operational complexity. In August '24, we acquired Suncorp Bank with its high-quality customer franchise of 1.1 million retail customers, of whom 40% are NFI, and more than 100,000 SME customers. That also gave us increased exposure to Queensland, a state where we were materially underweight. As noted at our half year results, Suncorp continues to perform well. However, to achieve the benefits of scale, we absolutely need to bring the 2 banks together and faster. We will complete a safe and secure migration of Suncorp Bank to ANZ by June 2027. As you expect, this work is already well underway. On migration, Suncorp customers will be moved into our existing stable and safe system stack and ANZ-branded channels and products. They will immediately benefit from access to a wider range of products and ANZ-expanded nationwide branch network. When we announced the acquisition, we estimated full run rate annualized cost synergies of $260 million. We are now updating these estimates to the full run rate NOI cost synergies of approximately -- sorry, annualized synergies of approximately $500 million per year, cost synergies, of which the vast majority will be captured in 2028. Throughout this journey, we will meet all of our federal and Queensland government commitments.

I will now turn to our third immediate priority, which is accelerating the delivery of ANZ Plus digital front end to all of our retail and small business customers. Stepping back, let me remind you what ANZ Plus was designed to do. It was a full replatforming of our retail and SME business, including the front-end channels, products and all platforms other than the core banking platform. The need to modernize and replatform these 2 business remains an undeniable fact. Having undertaken a comprehensive review, I am confident that our ANZ Plus technology, architecture and platforms provide the right foundation to deliver a market-leading customer experience.

However, the pace of the rollout of ANZ Plus has been too slow. This has led to structural and system duplication, brand and channel ambiguity and created a financial burden for the group. This was due to 2 major factors. On one hand, the sequence of development was predominantly vertical, product by product, which put the customer at the end of the journey, meaning, we would only have a viable end-to-end proposition when all products were built in our middleware and subsequently reflected in our front end. Second, our delivery model was inefficient. It was expensive with complex processes, a lack of prioritization and capability gaps.

To be clear, we are fully committed to delivering ANZ Plus but in a different sequence and through a new much more efficient delivery model. We are prioritizing the development of the front end of ANZ Plus, and we'll upgrade all 8 million retail customers in Australia to this new superior single channel experience by September '27. As a result, the experience for ANZ customers will be significantly modernized and improved while also providing better security and features. We are bringing the comprehensive and competitive ANZ Plus front-end experience to all of our Australian retail and small business customers across all of our retail and small business products, including credit cards and home loans connected to all of our channels.

In terms of tangible outcomes for ANZ, this plan delivers a profound and simpler and stronger Australian Retail and Commercial division. There will be 1 team with 1 brand, 1 single customer front end, 1 system stack instead of almost 3 of everything, and much sooner than previously planned. Once we have all of our Australia retail and small business customers on to the single customer front end, we will move to the next phase post '27, completing the replatforming of the middleware and eliminating existing legacy platforms with the exception of our core banking system to be very clear. Importantly, this will be done with minimal impact to customers.

Our fourth immediate priority is to reduce duplication and simplify the organization. We are stopping initiatives that are not aligned with our strategy and prioritizing what will make the most difference to our customers. Across the group, we have identified substantial opportunities to radically improve productivity through a simple organizational structure and operating model. This is already reflected in our announcement that we'll reduce 3,500 roles by September '26 as well as a further 1,000 managed service contractors. Around 60% of the ANZ rules are from group technology and Australia retail as we merge 2 teams and streamline support functions. The remaining roles come from consolidating middle office roles across the whole organization. There will be very limited impact on frontline roles in branches, contact centers, RMs or customer support in general. And there will be no overall impact to ANZ's known financial risk and management capability. In fact, that capability will be strengthened to ensure that ANZ meets its obligations and commitments.

We have also stopped projects and platform developments that don't serve our strategy or deliver tangible benefits for our customers. We have already exiting known bank activities that lack economic or strategic rationale such as cash rewards or -- and 1835i. We expect the impact of this initial productivity improvements to yield pretax annual gross cost savings of around $800 million in 2026.

Our fifth immediate priority and one which is critical across everything we do, it's improving nonfinancial risk management. This is a core part of our strategy and the key component of our third strategic pillar, resilience. A significant amount of work is already underway. I outlined much of it when I spoke with you last month following our settlement with ASIC in relation to matters within our markets and Australia retail business. This is a business and a culture transformation that delivers a better-run bank for our customers and will be executed at pace. In addition, the comprehensive enterprise-wide root cause analysis that was conducted gave critical transparency to the challenges we have in managing nonfinancial risk. We are making strong progress in addressing this.

I manage a weekly forum of my executive team to oversee products, drive accountability and remove roadblocks. We are driving better accountability and a culture of constructive challenge. We have appointed the right leadership to deliver this work, including Les Vance, who is reporting to me directly to coordinate the change required across ANZ. Importantly, we will lead an integrated program of work which addresses the requirements under the Court Enforceable Undertaking while also ensuring we address the ASIC Matters Resolution program and other critical risk programs in an integrated and holistic way.

Last month, we delivered a comprehensive Root Cause Remediation Plan to APRA as required by the CEU. We expect this work to take 3 years with the first year dedicated to design, followed by 2 years to implement and embed. I want to stress that I am ultimately accountable for making sure we get this right. These immediate priorities in our first phase will ensure we get the basics right while delivering significant cost benefit. This position us well for the second phase of our strategy, attacking the market with confidence and resetting the bank for growth and outperformance.

I will now address the strategic pillars that underpin the ANZ 2030 strategy with an emphasis on customer first. Allow me to be direct. It's quite fashionable to claim as the CEO of any organization that you are customer-focused or customer-centric. But stating this versus truly living and delivering on it are 2 very different things. Despite our good intentions, we have not consistently lived up to the expectations of our customers across all our business, in particular, in Australia Retail and Commercial.

The most important strategic shift I want to underline today, it's how we are going to get back to growth by relentlessly focusing on customers across every segment and business of ANZ. This is not about a headline on the slide, but rather a mindset we are going to drive throughout the organization that will strengthen loyalty and retention of those we bank with us while attracting much more new customers. We are focused on a set of initiatives, which will make a real difference to our customers and will drive growth and revenue outperformance over time.

As you might expect, the level of strategic change in Australia Retail and Commercial is more significant, while in institutional New Zealand, we are focused on extending and accelerating and optimizing our solid competitive position.

I will now run through some of these strategic initiatives by the vision starting with our Australia Retail. In this business, our deposit gathering franchise has not been strong, and we have lost share in MFI. We have not put the same level of energy and focus on our own proprietary channels as we have for brokers. We have underinvested in physical proprietary channels and not delivered on time in our digital channels.

This will change. First, in order to attract high-quality deposits and accelerate our customer growth, we will design differentiated propositions to customer segments, including the mass affluent segment and the people-relocating-to-Australia segment. The mass affluent segment is nearly -- it's a near $1.7 trillion source of investable deposits in wealth, which offers a high-quality growing source of bank deposits. We already have more than 200,000 customers with the right profile for this segment. And for people relocating to Australia, by far, the largest source of new-to-banking customers in Australia, we have an undeniable advantage in being the only major international Australian bank brand in most of the relevant migrant corridors, particularly Asia and New Zealand. In parallel, we will reinvigorate our transactional banking and credit card capabilities, regaining market share in these portfolios as we improved the quality of our propositions.

Second, a retail bank like ANZ needs multiple and strong customer acquisition channels. Without compromising our great broker relationships, we will materially invest and train our own mortgage sales force, aiming to increase the performance and the number of lenders in our branches by up to 50% over the next 5 years. This is already underway. In addition, we are uplifting capacity in our home loan assessment teams and making process improvements to remove friction whilst also investing in automation.

Third, we will continue to invest in our branches by improving our banker tools to support the work of our frontline employees. As we speak, we are also replatforming our contact center experience. And as I mentioned, we are developing our single customer front end to provide a leading digital experience. We will have the propositions, products and channel experience to win customers and grow our retail franchise. I want to mention here that we are also aware of our commitments to support the communities in which we operate by improving our case propositions. We also seek to support the inclusion and economic self-determination of First Nations people across Australia through our First Nation strategy. We have also have our Maori economic development strategy in New Zealand.

Turning now to our Australian commercial business. This is an attractive segment of the market. It is highly competitive, and we have materially underinvested in recent years. Today, our banker workforce is not matched in scale to meet our ambition, and our product platforms and processes do not meet customer expectations. In order to address these issues, first, we will increase our bankers materially starting now by close to 50%. We'll also boost capability and productivity by giving these bankers much better tools and systems and increasing the strength of our proprietary origination muscle. To support this, we will develop talent from within the bank through a Commercial Bankers Academy. Second, we will deliver Transactive Global, our best-in-class institutional platform to the middle market segment. We'll deliver the Plus front end to our small business customers by the end of 2027, as I said, 3 years early than was estimated. These investments will allow us to capture customers who are heavy users of payments, cash management and FX, the most profitable segment of the wholesale market. We will be leading transactional banking for all business segments in Australia, and we are currently -- as we currently are for institutional.

The third initiative I will focus on is in private banking. This business serves 70,500 customers and is growing fast with a focus on generating value through capital-light fee-driven services. We have a strong foothold in family offices and highly experienced private bankers with an average tenor of around 12 years. This financial year, we have grown investment funds by 20%, commercial lending by 17% and mortgages by 11%. We will be increasing the size of our relationship manager workforce, improving the quality of our offering and leveraging the work we are doing in Australia retail with the mass affluent segment.

I will now turn to Institutional and New Zealand. I would like to reiterate that these are both market-leading business, and our goal with both is to ensure we invest appropriately so they can maintain and grow their strong positions. Institutional, over the last decade, has transformed its customer relationships, geographic footprint digital capabilities and financial performance. Our starting position is strong. We have developed a capital-light business model having reduced our customer base from 27,000 to 6,000 with a clear focus on transaction banking and market flow products. It is delivering consistent returns above cost of capital while maintaining a low credit risk profile.

The 3 most significant actions we'll be pursuing to protect and grow these leading franchises are: first, leveraging our leading platforms and unique footprint to drive target customer acquisition. This includes, specifically, financial institutions and corporates with links to our home markets in Australia and New Zealand and multinationals operating intra-Asia. Our regional footprint is valuable, providing significant opportunities to participate in economic growth within the Asia Pacific region. We will continue to be the bank that connects Australia and New Zealand companies to the rest of the world and vice versa. Of course, growth will be targeted with the right customers in the right markets.

Second, continuing to invest in our transaction banking and markets platforms. We are focused on extending our leading position in payments and cash management and market flow products in Australia and New Zealand, and we will broaden these capabilities across our international network. Third, very important, strengthening our capital management muscle to optimize returns. We recently created a capital management structure within institutional which will build and enhance our capabilities in originate to distribute and balance sheet recycling. We are shaping an institutional business that is increasingly resilient to the credit cycle, financial market conditions and interest rates.

In New Zealand, we operate the country's biggest bank and serve 1 in 2 Kiwis, while delivering stable resilient growth, efficiency and shareholder returns. We are now about midway through the replatforming much of the business, including, in this case, core banking in train since 2022. This is being delivered on time, on budget and will be substantially completed by 2028. We are creating momentum to accelerate growth in New Zealand, and we are doing this by bringing the customer experience in line with our leadership position in the market by redesigning the customer journey to resolve pain points. Second, delivering bespoke propositions to customer segments, including to affluent and small business banking customers. And third, investing significantly in giving our business RMs, the right tools to outperform in target segments. This work might be furthered by the Reserve Bank of New Zealand's recently announced review of its 2019 capital requirements. As you can see, across of our 4 divisions, all of the initiatives I've shared are focused on delivering for our customers by meeting their needs and driving growth and outperformance.

I will now talk about our next 2 pillars briefly: Simplicity and resilience. Our simplicity pillar focused on our continued productivity program. We need to concentrate on meeting core banking needs and on doing work with the highest level of efficiency. To be clear, we'll avoid distractions. We have already taken the first steps to simplify our organizational structure, and we will be reducing the direct reports to the Executive Committee by 20%. We are implementing aligned structures across the enterprise and consistency in role definition, bringing clarity of expectations and improved oversight. We have created cost management units and giving a clear mandate and accountability to our senior leaders to manage enterprise-wide cost reductions. This is driving a culture shift in the organization which is necessary to successfully achieve a step change in cost management discipline. Beyond these organizational simplification efforts, we have identified significant opportunities to be managed through a formal program across 4 areas. These are: first one, process improvements through automation and AI; external spend optimization; organizational change; and investment portfolio review. For example, in our global capability centers in Bangalore and in Philippines, Manila, we will capture a new wave of productivity by running the teams in a horizontal manner, improving efficiency and scalability. We are also reengineering and automating lending submissions and manual processes and using AI to improve, among other things, quality control and complaints analytics. In addition, we are embedding a far more disciplined approach to our external spend, including strength in procurement practices and significantly reducing the number of vendors. In technology, we are challenging our vendor partners to work much more effectively with us to avoid and remove unnecessary expenditure on technology. The program of initiatives is designed to deliver sustained and expanded productivity throughout the full plan until 2030, giving us the flexibility to reinvest in growth initiatives.

The next pillar is resilience. It has been a cornerstone of ANZ's strength, resilience, for almost 200 years, and it's our third strategic pillar. We are strong in capital, liquidity and in our credit quality. We have a resilient capital position, and we are highly rated, one of the only 11 comparable banks globally rated in the AA band by all 3 agencies with a well-diversified and high-quality portfolio. The work we have undertaken over a number of years to reshape our lending book continues to drive good risk outcomes, which we firmly believe are structural in nature. We have a high proportion of investment-grade exposure than our -- any of our domestic peers. Around 83% of wholesale exposures are investment grade. We have also delivered peer-leading provision charges. Throughout our plan, we are also driving better returns, improving organic capital generation and further strengthening our resilience. In addition, our NFR program, as I said, is ensuring we have a better-run bank.

I will now hand over to Farhan who we will speak further about our fourth pillar, delivering value, which I'm sure will attract a lot of attention. Farhan.

Thank you. Thank you, Nuno, and good morning, everyone. Today, I'll discuss how we are delivering value from the ANZ 2030 strategy that has just been outlined by Nuno and how we will measure our progress over the next 5 years. And in particular, around the latter, I have connected with many of you and received feedback on the quality and consistency of our disclosures. We have heard your concerns.

So going forward, number one, we will report at each result a consistent set of metrics, which are foundational for the performance of the bank and outcomes for our customers and which align to the strategic pillars that Nuno has spoken to, and I will talk about these in a minute.

Number two, we will move to providing trading updates at the end of each quarter, starting from quarter 1 '26, in line with our peers.

And number three, we will ensure that we include consistent disclosures, including the drivers of performance such as NIM at our half year and full year results.

These disclosures will show that the plan we are announcing today drives stronger returns for our shareholders.

As Nuno indicated, the first phase of our plan is about getting the basics right and delivering value through a material improvement in productivity, while we execute the Suncorp Bank integration and move to a single customer front end. In that respect, on Suncorp Bank, Nuno outlined $500 million per annum in expected synergies. With clarity on the timing and plan for the migration of Suncorp Bank customers, we now have greater confidence on the increased synergy benefits. This is as a result of rolling off the transitional service agreement, consolidating head office functions, brand consolidation and reduced project spend, et cetera.

To give further context, the $500 million synergy number represents around 50% to 55% of Suncorp Bank's cost base, which is in line with the ranges you would see in global benchmarks for similar transactions when well executed. At the same time, while we are delivering greater synergies, we expect higher restructuring charges, which will lead to a 10% increase in integration costs to around $750 million in aggregate.

Our productivity program of initiatives, including role reductions and exit of noncore businesses, both of which we just talked about and announced last month, are expected to deliver gross cost savings of approximately $800 million in FY '26. Our productivity focus will continue in subsequent years, of course, and we will report progress at our results.

As we progress, we will be able to redirect more resources and investment into our strategic priorities to drive revenue benefits into the second phase of the plan. This includes capital-light revenue from targeting specific cohorts of customers, increasing the effectiveness of our customer-facing staff and scaling our technology and capabilities to improve customer experience. To support these immediate and broader strategic priorities, we will remain within an investment envelope of approximately $1.5 billion annually.

Throughout this plan, we will also take a highly disciplined approach to investment spend as we move through our phases of strategy, driving more value per dollar of spend. This will flow from a combination of better prioritization and improved technology productivity.

Now moving to capital and dividends. As we execute on our strategic pillars, we will be taking end-of-year specific items that impact capital. 2/3 of those have already been announced, i.e., the restructuring charges and the ASIC settlement. In addition, we are reviewing other large and notable items to be included in our FY '25 results that do not impact our capital. And these predominantly relate to potential adjustments to the carrying value of our Asian investments. These are being finalized and will be disclosed as part of normal year-end process, so we will not be addressing these further today.

In order to maintain a resilient balance sheet, including taking into account these items and to further strengthen our capital position, we will be implementing the following capital management actions. First, we will cease the remaining approximately $800 million of the share buyback. This will allow us to return surplus capital of approximately $1 billion from our nonoperating holding company back to the bank. Second, we expect to apply a 1.5% discount on the next 2 dividend reinvestment plans, which we also expect will not be neutralized.

Regarding the dividend, the Board recognizes the importance of consistency and stability that our shareholders expect. Our final 2025 dividend is subject to determination by the Board and will be announced with the release of our full year audited results. However, the Board is confident in the strategy and, with the capital actions just announced, expects the final dividend to remain unchanged from the first half. The franking rate for that dividend is also expected to be maintained.

The plan we have presented today gives us confidence in the organic capital-generating capacity of the bank. This, and the capital actions I've just announced, ensure that our balance sheet and our capital position are strengthened, enabling us to deliver on our priorities while supporting our customers and delivering value to our shareholders. To be clear, this also includes the impact of the acceleration of the integration of Suncorp Bank as presented today.

In terms of our scorecard, we are committed to transparently reporting progress against our strategic pillars. And as I said, we will improve consistency in our disclosures. Accordingly, we have established a set of key metrics aligned with our strategic pillars including our primary targets. Under customer first, we will focus on reporting NPS and relationship strength indicators and on the key measure of MFI growth. In simplicity, we will report progress on our gross cost savings of $800 million in FY '26 and on delivering the Suncorp Bank synergies. We will also report our cost-to-income ratio for the group. For resilience, we will report progress against our NFR remediation plan and common equity Tier 1 capital ratio. And in delivering value, we will report on our return on tangible equity and revenue to risk-weighted assets. These will be included in our regular disclosures with updates provided at each results announcement.

In addition to these clear metrics, we are, today, committing to a set of critical targets that will deliver value for our shareholders, and these are: Increased return on tangible equity from 10.3% as reported for FY '24 towards 12% by FY '28 and towards 13% by FY '30; achieve a cost-to-income ratio in the mid-40s percent by FY '28 and sustained through to FY '30 within that range. That will include the impact of the estimated gross cost savings of $800 million to be delivered in FY '26 as well as the impact of the estimated Suncorp Bank synergies of $500 million, with full run rate synergies, as Nuno outlined, realized in FY '29.

I am confident that our ANZ 2030 strategy will allow us to deliver on these targets and deliver value to you, our shareholders. Thank you very much. And with that, I'll hand back to you, Nuno.

Thanks, Farhan. We are acutely aware that delivery and execution are central to our ability to meet and exceed the expectations of our shareholders, customers and colleagues. This starts with leadership and how we role model. We have a refreshed leadership team with the right capabilities, and we'll continue to invest in attracting and developing high performance, high-performing talent. And we are committed to transparency around the reporting of clear measures, which we are accountable for, as discussed by Farhan.

So to summarize, we will be delivering our strategy in 2 clear phases. In the first phase, we will get back to basics and deliver material productivity through the execution of our immediate priorities while initiating the necessary investments for future growth. As we transition into our second phase, we will see an acceleration in revenue growth with all 4 divisions performing strong as a result of our differentiated propositions, proper origination and channel upgrades, reduce the disintermediation and extend the leadership in transactional banking and market flows products. The group will be positioned to deliver to our full potential with a clear strategy, strong leadership. And this [indiscernible] execution, we are well placed to deliver meaningful value for our shareholders.

With that, I will now hand back to Kylie to manage the Q&A session. Thank you so much.

Okay. Thank you, Nuno, and thank you, Farhan. So we'll be taking questions from the room today. When you ask a question, if you could please introduce yourself and where you are from. And please, can you keep your questions to 2 per person. And then if we have time, we will come back to you for further questions.

So we've got Cameron with the microphone. And so Cameron, if you could please hand the microphone. Thank you.

Rich Wiles from Morgan Stanley. I have 2 questions. The first relates to the $800 million of cost savings. You want to achieve that by the end of FY '26. Is it reasonable to assume that you'll be targeting additional cost savings through FY '28 and FY '30 in order to drive the higher returns that you're targeting?

Yes. So we wanted to signal the $800 million in 2026, which, by the way, just to be clear. When we say by the end of '26, it doesn't mean that we only achieved that run rate at the end of '26. It means that in the year of '26, there will be cost savings of $800 million, just to be very clear.

We want to single that number on the first year to send a clear message that our plan is not about a plan that takes the benefits or puts the benefits at the end of the 5 years. It's a plan that continuously improve returns year after year, starting on year 1, okay?

For that, it's fair to say that in the first 2 years, productivity, it's more important than revenue outperformance, to be clear. On the 3 last years, the revenue outperformance is, in relative terms, slightly more important than productivity, okay? So $800 million is just a part of the productivity. $500 million is another part. The Suncorp synergies, they intersect between the $500 million and the $800 million is minimal, to be honest, $800 million is the first year Suncorp, we actually can start synergizing after the merger, which happened in '27. There are some elements we are achieving in the short term, which we have been communicating.

So you can have $800 million, $500 million and some additional elements that will be conquering as we automate the company. The first year, the opportunities we have to rationalize the company are so obvious, so obvious in terms of duplication, in terms of things we should not be doing that they add to this possibility of reduce $800 million. Don't expect $800 million every year, but expect productivity to be a quite important component of year 1 and year 2 and continues to deliver in years 3, 4 and 5.

My second question relates to your deposit pricing in the retail bank. I think you've acknowledged that you've had different customer propositions across the Plus products and the classic products. It appears to me that you've got a real challenge with your deposit pricing for many of your customers. The ANZ Progress Saver is well below market, and the Bonus Saver is also well below market or the progress over in the Online Saver below market. Can you talk about how you might address that and whether you should have single pricing for all your customers?

As we said very clearly, very soon, there won't be 2 front doors for customers, there won't be 2 brands, there won't be 2 system stacks, there won't be 2 teams. Actually, on the 2 teams, that's already been addressed, which means that very soon, we'll have 1 pricing scheme and 1 set of products, right? So that's -- I think that answers clearly to the question of are we continuing to have different prices? No. They will be integrated quite obviously.

And what I would add is I don't believe that a universe scale back that delivers good services to customers, which is a very big vision of us, should be structurally competing on price. I don't think that's a sustainable long-term strategy by no means, which means that you could say you have 1 competing on price and the other -- on the other side of the equation, as we integrate the 2 brands and the 2 systems and the 2 customer base, if you want, that will be rationalized. And you could say, one, we have to be more generous and the other less generous as we integrate. But as you can imagine, I cannot talk a little bit -- a lot more about pricing, but your point is good. We are on top of it. And it's very clear what we want to do and what we don't want to do. Thanks.

Thank you.

Tom Strong from Citi. I just want to talk about your growth ambitions in the retail and commercial bank over the next couple of years while you sort of build out some of these initiatives on the productivity side. I mean arguably, the deposit franchise has held back profitable growth in the retail bank in recent years. So how should we think about your appetite to grow that division while you make the necessary changes in terms of these new propositions on the technology side?

Full appetite. Okay. And full appetite, not because -- not because I think retail is a nice thing to have, it's that retail and commercial in Australia it's 3 quarters of the revenue pool of this market. So not doing those things in line with the potential, it punishes your company. So undoubtedly, we are fully committed to reset the bar of retail and commercial in many ways and forms, right?

The deposit franchise, it's not something you can address in 6 months. It's a long game, as you know. I'll be very simple. For fixing it, you need to have 2 things: more customers; and customers that really like you really engage with you and they really treat you as you're a primary bank. So all the things we are thinking about is to address that. First, to get the basics right. All the services have to be upgraded materially, and we are on it. Second, your 8 million customers, they don't look like the same. If you treat them all the time, you are doing a big mistake. You have to treat according with their needs, which means differentiate and deliver superior propositions, which allows them also to pick you as your primary bank. We are happy to commit to this. Obviously, then your channels have to work in parallel to make that happen. Your brands have to be much more powerful in how do they go up to the markets. Your digital channel has to be one, no confusion and complete. Your call center has to be automated. And to be honest, it's becoming a commodity using AI to make it like that. So we have clear ideas of what to do.

It takes time. And this is a plan which is realistic. We're not going to promise you a miracle in the next 2 years. it will be naive. We are silently upgrading our capabilities, making sure the bank is in shape, investing today. In the next 3 years, in the following 3 years, we will outperform because we have clear ideas. You're absolutely right, but we will do it in due time. Okay.

Great. My second question is just around the resequencing of Plus. Does this require new investment into middleware to bring it to the 8 million customers? And will that get captured in the investment spend on the [ what ] of $1.5 billion over the next couple of years?

No, it does not. What we are doing is -- and to be clear, because I know Plus has been obviously a theme, the thesis of replatforming the commercial and the retail bank at ANZ, their thesis was right. We need to modernize the systems that we operate, okay? And as I said, the initial idea was we will replatform everything except the core banking system. So the middleware, the product systems, if you want, the horizontal platforms and the front ends to the market, right? Their thesis was right.

As I said, 2 things were not right and made it too slow and too expensive. The number one was the sequence. Plus was built vertically product by product, which means you could only offer a comprehensive front end at the end of the journey. Only at the end of the journey, you will have all the products to show up in your front end, right? That's one.

The second is the way we build Plus clearly was not efficient for many reasons, not efficient. So we are saying the obvious thing, the architecture, the technology is the right one. But the way we are going to do this from now on is very different. And it does not need more money, needs less money. We are going first. We are going to build the bank horizontally. What customers see, they see a front end. That's what they see from us. They see our channels. They see the mobile, they see the Internet, they deal with our branch. They do it at the call center. They don't see the rest. So the first thing we have to do is deliver them a best-in-class front end with one brand, don't confuse them. One brand, one front end that is connected with all channels, digital customers, physical customers, doesn't matter, one front end, one way or track with customers. That's Phase 1. That's what we're posing right now. And those customers will be there in '27.

After that, you digest the rest of the middleware, at your pace, at the pace that your ambition, your financials, your sustainable investment levels allows. And customers would not feel it because they have the best front end. That's what we should be doing. That's what banks do globally. They deliver transformations horizontally, platform by platform, horizontally, not vertically. So great technology, great platform, let's do it with the right delivery model. Everybody wins.

Just to be clear to your second part of your question, yes, it is part of the $1.5 billion investment envelope, the part that we are following.

There is nothing outside of that envelope.

Andrew Lyons from Jefferies. Nuno, you mentioned in your speaking notes, the retail and commercial in recent years has been somewhat starved of investment, which does appear to have adversely impacted the revenue generation of the franchise. Now what you've announced today, there's obviously a lot in it, but the first phase of the strategy does appear very cost focused. And there's no change in your investment spend at sort of around $1.5 billion. How do you get comfortable that this won't further impact the revenue generation of the broader franchise?

Yes, it's a very important question. Fully confident for the following. If you decompose where we are investing our let's say, $1.5 billion. And the $1.5 billion is what we call our investments like there is much more investment in the total technology volume, if you want. But let's talk about the $1.5 billion. We are fully funding our Suncorp migration. We are fully funding the front end Plus buildup. But it's much less expensive than what we needed to do in the past, just to be clear. We are increasing our commercial investment by 70% in technology, 70%. We are increasing our New Zealand investment in 2026 because New Zealand is in a position where they have their basics right. They can run faster right now, okay? We are investing the same in institutional. And we are investing in the biggest programs in the company. We are doing less, but well. We are investing in re-platforming our call center, as we said. We are investing in a new lending origination for wholesale and new collateral platforms. We are investing more on the things that are important to compensate for this, you would say, well, but then we stopped doing a lot of stuff that didn't make sense for the company. And the productivity of each dollar we'll invest in technology is being increased significantly. We tend to -- and I understand why because that's what you have and that's sometimes what we have. We tend to associate dollars to outcomes. Well, it's a proxy. But our observation is we can be much more successful in squeezing outcomes of each dollar we spend in technology.

And by the way, there is a legend that ANZ spends less than the others. It's not true. Absolutely not true in terms of technology. So we thought about that very clearly on what goes up and what goes -- what stays and what is not done.

And then just a second one. You've spoken to the $800 million of gross cost savings by FY '26. Just to help us, I guess, understand the path to your FY '28 targets. Can you maybe just talk to how those gross savings must -- to what extent some of those gross savings might be reinvested in the business? Or to what extent should we see them fall through to the bottom line?

Yes. So you have almost everything because we told you how much we're going to invest. We told you our cost savings. We have inflation. So listen, you have almost everything to guide '26, right? It's just mathematics and you put the rest, right? '27, you also have the synergies of Suncorp, which will start to be material in '28, just to be clear. We are not guiding year-by-year, sorry. We're not guiding not -- we're not putting our P&L in front of you. We're not guiding division by division. What I would say is the first 2 years, productivity gains are quite important. But we have clear visibility on how to achieve them. They are not a number, they're not a number. In '26, '27, that's a part -- a significant part of our returns improvement that they are material. And then '28, '29, '30, less -- in relative terms, less productivity improvements, but still and revenues start to outperform, okay? That's what I would say. In terms of composition, some business go faster than others because they have better positions to start this next phase, this race, this next 5 years race or marathon, if you want. And I already addressed which ones.

But Andrew, we will continue to report on a half yearly basis, those metrics. We are being very clear in terms of indicating what our target CTI is by '28, and we will show progress against that. Initially, as Nuno said, that will come from cost in the first couple of years. Productivity has to be part of our DNA going forward forever. It's not a one-off outcome. But we -- but insofar as the reinvestment is concerned, the $800 million of gross product -- gross productivity in '26 to the extent that's offset by inflation should fall into the bottom line as we're keeping investment flat.

That's right.

Ed Henning from CLSA. Just a follow-on from Andrew's questions on the total cost. You've obviously -- you've obviously talked about cost to income, your cost about savings. You talked about inflation coming through. Just as we push forward, can we think about the underlying cost growth of the BAU around inflation costs while you're still pulling up productivities and you're investing in the business? How should we think about that underlying cost number?

We're not guiding year-by-year again. And Farhan, you -- please keep me well behaved here. But you should expect the first 2 years to be very successful in improving our cost to income, right? Our guidance is very clear. By '28, we are saying mid-40s. And by the way, 48 is not mid-40s, okay? Some people yesterday were in the room saying, hey, 48 is mid-40s because I am 48. Am I too old? No. Yes, you are too old. So mid-40s is mid 40s. It doesn't accept a lot of -- there are no tricks on the words, okay? It's just -- it's around mid-40s, but it's not 48, just to be clear, right?

So in order to get to that number of mid-40s in roughly 2.5 years, right, let's say '28 is half -- it's average '28, you have to run fast in your productivity program in '26 and '27 because we're not going to have a part in revenues, nobody is probably. So you have to run fast your program, doing it well. And at the same time, you have to invest smartly on the things that matter, the ones we said here, in order then to allow the bank to unlock its full potential. So that's the equation.

And Ed, I think this is a more meaningful conversation at results because when we have the full year result numbers, we can talk more specifically to what '26 would look like.

And so just following up on the cost, is there any change in the investment or capitalized expense of your investment spend? Are you still -- you guys haven't got a big capitalized software balance which is obviously a positive for you now, but is there any change going forward?

Not any material change. That guidance will continue -- will continue to be the outlier versus the rest of the industry. But Farhan, you want to give it?

No, I think that's right. And we will -- obviously, Ed, as you know, with the shape of investments, there could be shift in capitalization levels. But broadly speaking, we're not changing our capitalization policy. We're not announcing any change. And to the extent that there is impact, we will continue to guide at results.

And just a second question. You touched on before about not pulling the price lever too hard. It was a part question. The second leaf out of BJ's book. Just talking about you're not pulling the price lever and you're obviously in 2 segments in the commercial and retail you're underway. To get back there, obviously, you need to -- using technology and you're adding bankers and stuff, but to get in people's -- right in front of them, do you need to pull the price lever initially to help get that momentum going?

There is structural -- there is being a structural discount competitor. And then there is campaigns and, let's say, a moment where you can do A, B and C. I have been very clear to the team, and the team have been executing it clearly, about not competing structurally on discount. Now that will be certainly much more effective as we pull together our capabilities, okay. But you probably saw, for example, in mortgages, we just took out the cash back for refinance for mortgages. We took it out. And it was something that some of you sometimes commented by the way, not because of you, but I certainly didn't enjoy that. As you know, mortgage is a business that came down in [indiscernible] in terms of returns quite clearly. So we all need to think about how to make it sustainable from a return perspective. And we thought that it was the moment to send a message to ourselves that we need to build advantages on our front and on our processing that takes us to a point where we don't need to compete with those elements, okay?

Today, as we all know, we are not flowing in the market in mortgage, market share perspective, and that's conscious because we want to put the house in order in terms of front and the house in order in terms of back, which we expect to be in 2026, middle of the year. So we've been thinking about those things very clearly. And what I would say is structurally, no price discounts structurally. Obviously, we're a competitor. Moments in time, we can have campaigns and stuff and things like that

Jon Mott from Barrenjoey. You talked about before cost to income, mid-40s means mid-40s. You also used the word towards 12% ROTE and towards 13%. I want to play on this because accountability is very important. So are you committing to 12% and 13% ROTE? Are you committing towards because they're very different numbers. So what do you actually mean by that?

12% and 13%.

So that is the word towards...

12% and 13%. Yes.

Or just replace 12% and 13%?

12% and 13%. As you obviously know, there is no trick, just to be clear, no tricks on what we are saying, 0. Towards, this because we are coming from below. So we have to go there. That's -- you know what I mean if it was this is going up. But we're not playing games. It's 12%, 13%. Now obviously, we are not positioned to the point that I can promise a 12% one point. So it's towards, but that's the number, 12% and 13%, no games there.

Yes. Thanks. No, that's exactly right. Our plans are designed to deliver those numbers, Jon. But I think it's also important to mention that it's not a ceiling either. So it's not that we are saying, well, we'll hit 12% and then we'll stop.

Second question around the dividend, and you commented, obviously, it's the Board's decision, but having a 1.5% discount on the DRP for the next couple of JVs and holding it flat, we have seen regional banks use discount DRPs to raise equity in the past. But their justification has always been that they've got excess franking that they need to distribute. You've got the opposite of the shortage of franking. So you're effectively doing a DRP discount on a partially unfranked dividend, which seems completely economically irrational. Can you explain the economic rationality of that decision?

Yes, we can.

Look, I can start and certainly Nuno can add. I would say 3 things at this point, Jon, and we can certainly debate it more at results, if you like. Number one, we are confident in our strategy, the capital generation under the strategy that we've announced, and the ability to not only sustain dividends over this period of the plan period. But as we see NPAT growing faster than dividends, we expect that we should have capacity should the Board agree to pay higher dividends over this period of time.

So that's -- so dividends is not the fundamental issue here that we're trying to address. What we're trying to address is the specific items that we've announced, and we wanted to make sure that we had specific solution for those without signaling anything around our capacity because we are very confident around our capacity.

The second thing I would say is that we are -- the Board is very clear as is management around making sure that we are very focused on stability and consistency of dividends. But I would say the other aspect of this, which is really important, Jon, is that the Board makes this decision in the context of all of our shareholders and the better interest of all of our shareholders. So it's finding that balance between dividends and potential DRP/equity exercises.

The third thing, which is really important because we are raising a bit more capital than we have -- than we are announcing through our specific items at the end of the year. We want to be very clear. We want to take capital off the table. We will have sufficient capacity to not only invest and deliver on our priorities, but have the ability to be flexible and have the ability to manage through any potential shifts in terms of the environment so that we can be confident that we have sufficient capital to deliver on what we have explained today.

So it is the combination of those 3 things, Jon, which has driven us to get to that point. We didn't think that a dividend cut of the magnitude that we had to do to deliver that capital strength would have been preferred relative to the exercise we're doing now.

It was undoubtedly the best option to compensate for the one-offs that you just announced, and for the fact that we want to play with capital levels around 12%. So if you combine those 2 things, we want to go through all of this process. It's not a target, by the way, just to be clear, but it's that we are doing this for 2 reasons: obviously, absorb the one-offs, they are one-offs in nature. There is no rationale to do any structural change in our capital, and we want to play with capital levels very much in line with the industry and peers. That was it.

Andrew Triggs from JPMorgan. As the nature of these things, you've given us gross cost-out targets, but could you give us some view of offsetting cost in as distinct from investment spend itself required in the retail and commercial banks? And you've noted, obviously, hiring a business in retail bankers or proper channel bankers. And what should we think about the sequencing of these? I think you said it's quite upfront.

So you're talking about investments, right?

Investment, which goes into investment spend slide. And then there's actual hiring bankers won't necessarily go into investment spend, but it will be an offset to that $800 million gross number you've given us.

So all our -- our plan takes into account obviously, the productivity that action that we are taking, and they are quite substantial and well sought. And just to be precise, all of those productivity measures that we have in our plan out to 2030, they have clear chapters. We mentioned the 4 major chapters. Beyond -- below those 4 major chapters, they have subchapters, which then have names of people, which has have quantification, which then are sliced between '26, '27, '28, '29, '30. The teams know exactly what they need to execute to get there on the productivity side. Actually, productivity should be about that because it's -- in theory, it's up to you to execute them. It's less difficult when you have to deal with the market on revenues is more complex because it depends on competition, services, et cetera. So that plan, it's very clearly there, right?

The plan also defines clearly which of these savings, even though it's in pockets, have to flow into investments. So the plan has all the initiatives I just talked about it. And as you can imagine, I went to 3 major initiatives for each of the 4 divisions. They are the 3 most important ones, but there are others. All those initiatives, they have chapters and subchapters with the amounts of necessary investment and when the outcomes come in revenues year after year, '27, '28, '29, '30, okay?

All of this is in the plan. I will not tell you how much we'll invest in each year because then I would start disclosing to levels that we are not guiding today, okay? What I can tell you is that the plan that we have that is supporting the number that we are guiding today, it's a very detailed plan at initiative level, at individual level, accountability level. That's how we operate in this company.

To be clear, is there a material offset to the $800 million gross savings in FY '26 from...

No. No. And I think I was very clear, meaning I told inflation. Inflation. That's what I said for your numbers. So again, no tricks. It wouldn't make sense to tell $800 million then come here and say, but we consume that in -- we're not going to talk with a market like that. if we highlighted $800 million, it's because there is a special meaning of the $800 million, okay? And we were very clear also, the $1.5 billion on tech, which, as you know, typically is the biggest investment item in banks -- in bank's P&L, it's a $1.5 billion. It's basically the same as the previous year, but much more focused on doing the right things and the things that matter, right? So yes, allow me to say there.

And then Slide 15, I think it was on ANZ Plus. Just keen to understand exactly what customers will see. So effectively in the future, ANZ Plus customers their ANZ Plus customers, they'll just be an ANZ customer. In terms of the duplicated or the dual-run costs involved with the platform, when can we sort of think about those starting to come out of the bank?