An old bank€¦ · in Greece. Gold Medal, 1998 Australian RowingChampionships. Bank of Melbourne MIS and Finance Assistant. Partnering our Australian Olympic and Paralympic heroes

An old bank...

2000 Concise Annual Report

in the new

2Chairman’s reportJohn Uhrig outlines the profitresult and progress on keyfinancial objectives in hisfinal report as Chairman.

8Chief ExecutiveOfficer’s reviewDavid Morgan describesprogress on our five pointstrategy for deliveringvalue, and the teams whoare delivering the goods.

30Westpac at a glanceA snapshot of our Company,our executive team and ourbusinesses, including theirleadership positions andopportunities for growth.

36Westpac in the communityAn insight into our communityactivities detailing ourprograms and the greatcontribution from our staff.

40Board of DirectorsA listing of Directors,their qualifications, termin office, backgrounds,experience, and informationon other directorships.

What’s in our report?

1

economy.

42Corporate GovernanceA statement covering the roleof the board, its committeesand meetings, codes ofconduct, policies and othergovernance issues.

48Directors’ reportA report on the affairs of Westpac including details of directors’shareholdings, attendance at board and committeemeetings, remuneration and other matters.

56Ten year summaryand concise financialstatementsA summary of keyinformation for the years1991 through to 2000 andconcise financial statements.

69Shareholder information A financial calendar for2001, information onshareholdings and shareregistry contacts, keyexecutives and pointsof contact.

70Obtaining the FullAnnual ReportWe are providing our reportto shareholders in two parts:this Concise Annual Report,and an Annual FinancialReport. See page 70 toobtain additional copies.

Westpac Banking CorporationABN 33 007 457 141

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Chairman’s report

On track

John Uhrig Chairman

3

“In last year’s report I talked about theopportunities the new century offers us.This year’s result is an excellent first steptowards realising those opportunities. We livein a world where change is the norm, whereold rules no longer apply. We’re facing thechallenge of meeting that change head on.Our first step was to fully understand wherewe are. Now we’re implementing a clear planto unlock our potential even more. In my finalyear as Chairman I’m delighted Westpac hasbeen able to deliver our best-ever result andprovide shareholders with a clear understandingof how we intend to better it in coming years.”

4

Chairman’s report

As an Official Partner of theSydney 2000 Olympic Gamesand Paralympic Games, we sharedin the athletes’ success anddelivered our own record-breakingperformance. The activitiesflowing from our five pointstrategy, outlined in this report,are delivering operationalefficiencies, improved businessgrowth and enhanced shareholdervalue. In many ways it has beena year of Olympic proportions.

Our record result of $1,715 millionprofit after tax is an 18%improvement on 1999. Earningsper share were 88.8 cents, animprovement of 15% on last year.The return on average equity is18.4% compared to last year’sfigure of 16.8%.

Last year I announced that we had established two clear financialobjectives against which we’llmeasure our progress – sustainedreturns on equity well in excessof our cost of capital, and earningsper share growth consistentlyexceeding the economy’sunderlying growth rate.

For the 2000 financial year I’mpleased to report our return onequity was well above our cost ofcapital of 12% and our earningsper share growth was well abovethe economy’s underlying growthrate of 4.5%. By both measuresthis has been a successful year.

As a consequence of the improvedfinancial performance the boardintends declaring a final half yeardividend of 28 cents per share.Together with the interim dividendof 26 cents per share, the full yeardividend of 54 cents per sharefully franked will represent a15%increase on last year’s dividend.

Market capitalisation rose to$23 billion as at 30 September2000 from $17.5 billion theprevious year. This is despite the fact that we bought back108.7 million Westpac shares on-market at a cost of $1.27 billion during the year.

Importantly, the quality of ourassets remains high and issupported by strong credit riskmanagement principles nowfirmly embedded in the business.Although official interest rateshave increased, our bad debtexperience is well withinexpectations and we remaincomfortably provisioned.The levelof total provisions increased to249% of total impaired assets.

We continue to tap into ourcustomer base in a targeted way,improving on the opportunitiesto increase the product take-upof our 7.8 million customers.As evidence of our effectivenessin this area, the number ofcustomers with multiple productholdings has doubled over thepast three years. Improvements inInternet banking and eCommerce,and the changes we’re making toour physical representationnetwork, are providing ourcustomers with 24-hour every dayaccess to the bank in support oftheir increased product holdings.

Steve PorterSilver Medal,Wheelchair Rugby,Sydney 2000Paralympic Games.Represented Australia1999 World WheelchairGames. Won1999Trans Tasman Clash(Australia v’s NewZealand). 1996 AtlantaParalympic Games.1995 WorldChampionships.1994 World WheelchairGames. WestpacTeam Leader HumanRelations Operations.

Liz WeekesGold Medal, WaterPolo, Sydney 2000Olympic Games.Campaigned tirelesslyto ensure women’swater polo wasincluded as an eventfor Sydney 2000.Member of theAustralian gold medalwinning team at the1995 World Cup.Sponsored by Westpacsince 1998.

Amy WintersGold Medal, Athletics,200m and 100m,Bronze Medal 400m,Sydney 2000Paralympic Games.Gold Medal 200m,Bronze Medal100m, 1996 AtlantaParalympic Games.100m world recordholder. 1999 SportNSW Athlete of theYear with a Disability.Marketing Coordinator,Westpac InstitutionalBank, Olympics Unit.

Matt DunnTriple Olympian,Semi-finalistSwimming 200mIndividual Medley,Sydney 2000 OlympicGames.1999 PanPacific 400mIndividual Medleychampion. Member ofworld record-breaking4 X 200m FreestyleRelay team at the1998 CommonwealthGames. Consideredone of the best turnersin world swimming.Sponsored by Westpacsince 1997.

Jane WebbSilver Medal,Wheelchair Basketball,Sydney 2000Paralympic Games.1996 AtlantaParalympic Games.Series winner 2000Australia v’s Canadatest series. Undefeated1999 Australia v’sUSA test series. BronzeMedal, 1998 WorldChampionships. EnergyAustralia Gold Cup1998 (3rd). WestpacProject Manager,Sydney 2000 Olympicsand Paralympics.

Susie O’Neill OAMMadame Butterfly –Australia’s mostsuccessful swimmerever. Gold Medal 200mFreestyle, Sydney 2000Olympic Games. Worldrecord holder 200mButterfly. 35 Australiantitles. Inducted as a fullmember of the IOC,September 2000.Sponsored by Westpacsince 1997.

Christian RyanSilver Medal Men’sEight Rowing, Sydney2000 Olympic Games.1999 World RowingChampionships,Canada. Gold Medal,1998 U/23 WorldRowing Championshipsin Greece. Gold Medal,1998 AustralianRowing Championships.Bank of Melbourne MISand Finance Assistant.

Partnering our Australian Olympic and Paralympic heroesOver the past four years, Westpac has supported 61 Australian athletes. It’s not how they do it, but it does help.

5

We have laid sound foundationsfor further growth. We have atrusted brand and a competitiveproduct range, award winninginternet and eCommerce offerings.We have a quality balance sheet,satisfied customers drivingimproving sales volumes andmarket share, and a stronglymotivated workforce. With thesefundamentals in place your Boardis confident that Westpac is wellpositioned to meet the challengesof the future.

For many Australians this hasbeen an exciting year becauseof the 2000 Olympic Games andParalympic Games in Sydney.Being an Official Olympic andParalympic Partner has madethis an especially exciting yearfor us at Westpac in Australia.

Our sponsorship of theseextraordinary events has givenus a high profile in the lead-upto, and during the Games, andis delivering the benefits weenvisaged when, in 1994, weaggressively sought the Games’exclusive banking rights.

We believed that Westpac, asAustralia’s First Bank, should bethe Official Banker to the Games.The wisdom of those actions hasnow been proven by the result.

The financial results we haveachieved and the success of ourOlympic Partnerships reflect theefforts of our staff. They havedemonstrated a capacity forachievement in an environmentof rapid change and increasingcompetition that is trulyremarkable. On behalf of theboard I thank them all for theirhard work and dedication.

Following my retirement from theboard after the Annual GeneralMeeting on 15 December 2000,Deputy Chairman Leon Davis willassume the role of Chairman. I’m confident the bank will be ingood hands under his direction.

Since I became Chairman in 1992we have seen an extraordinarychange in Westpac’s fortunes.

From a position whereshareholders were bearing thefallout from the late 1980s andearly 1990s, we have achieveda remarkable recovery.

This turnaround is symbolisedby the solid improvements in ourfinancial performance in recentyears, and confirmed by anotherrecord performance in thisfinancial year.

It has been a privilege to presideover that period of change, and tosee the bank well equipped, onceagain, to play a leading role in thefinancial affairs of the communitiesit serves.

My thanks to my fellow directors,and to the management and staffof the bank, for their supportduring these historic andinteresting times. My best wishesto all stakeholders in Westpac fora prosperous future.

Karni LiddellBronze Medal 4x50mFreestyle Relay, Sydney2000 ParalympicGames. Gold Medal100m Freestyle, 1999British Nationals. GoldMedal, 50m and 100mFreestyle, 1999German Nationals.Bronze Medal 50mFreestyle, 1996 AtlantaParalympic Games.50m Freestyle worldrecord holder. WestpacProject Assistant, HeadOffice Queensland.

Grant HackettGold Medals for1,500m Freestyle and4 x 200m FreestyleRelay, Sydney 2000Olympic Games.Current World,Commonwealth,Olympic, Pan Pacificand Australian 1,500mFreestyle champion.Second fastest 1,500mFreestyle time inhistory. Sponsored byWestpac since 1998.

Sue GraysonTrack and Field –Marathon. Selectedto the Australian Team1987. RepresentedAustralia at WorldChampionships forroad and crosscountry running in the marathon at the1996 Olympic Games.Westpac Learningand DevelopmentConsultant since1999.

Troy Sachs OAMWheelchair Basketball,Sydney 2000Paralympic Games.Gold Medal, 1996Atlanta ParalympicGames. 1997 MostValuable Player &Highest Scorer NWBL.1996 Athlete of theYear. NSW WheelchairSports Association.1994 WorldChampionships.CommunicationsAssistant, WestpacStakeholderCommunications.

Belinda StowellGold Medal, Sailing,Women’s 470 DinghyClass, Sydney 2000Olympic Games.Winner 470 OlympicClass Championships1997, 1998, 1999.Winner 470 OlympicClass Sydney Regatta1999. Winner 470Olympic Class NewZealand Nationals1998, 1999. AssistantManager, WestpacInstitutional Bank.

Ian ThorpeThe youngest maleworld champion inhistory. 3 Gold Medalsand 3 world recordsfor 400m Freestyle,4 X 200m FreestyleRelay, 4 X100mFreestyle Relay,Sydney 2000 OlympicGames.2000 YoungAustralian of the Year.Sponsored by Westpacsince 1998.

Sally SmalleyRoad Cycling.1998and 1995 Australianteam member. 4thplace in the 1995Oceania Games.Sally’s mantra is“Perseverance – nevergive up – ever!”Customer ServiceRepresentative,Telephone Banking,Bankof Melbourne.

6

$1,715m

So, how well did

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ProfitOperating profit after tax andbefore abnormals, attributableto shareholders.

Operating profit increased by18% to $1,715 million. Thisresult is the eighth consecutiverecord annual result. The latestresult reflects the progress onthe priorities set in1999 toimprove cost efficiency, torealise the potential from theregional bank mergers, and toprogressively tap eCommerceopportunities.

Chairman’s report

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1,132

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88.8c

EarningsEarnings per share, beforeabnormals.

Earnings increased to88.8 cents per share, animprovement of 15% on theprevious year. Including thefull year impact of the NZClass shares issued in October1999 and the distributionson the Tier 1qualifying hybridequity, net of the sharebuy-back, earnings per shareincreased slightly less thanprofit growth.

54c

DividendsDividends per ordinary share.

The return to full franking andthe record profit will allowthe Board to deliver a 15%increase in dividends to54 cents per share.This isin line with the growth inearnings per share, andrepresents a payout ratioof 60.8% for this year.

33

39

43

47

18.4%

96 97 98 99 0096 97 98 99 0096 97 98 99 0096 97 98 99 00

ReturnReturn on average ordinaryequity, before abnormals.

Return on equity increasedto 18.4% from 16.8% last year,continuing the steady andconstant improvement ofrecent years. Returns arenow comfortably above our cost of capital of 12%.

14.6

17.0

15.5

16.8

58.9

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Ten year trends

91 00 91 00 91 00

249%

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233

96 97 98 99 00

7

we do?$1,058m

Economic ProfitThe excess of net profit aftertax, plus 70% of the face valueof franking credits, over theminimum required rate ofreturn on equity invested of 12%

In the latest year, EconomicProfit improved substantiallyto $1,058 million from$669 million last year,reflecting improved profitabilityand the return to fully frankeddividends this year.

554

716

694

669

ProvisionsTotal provisions to totalimpaired assets.

Total provisioning for impairedassets increased in the yearfrom 233% to 249%, providingan increasingly comfortablelevel of cover.

3.1%

96 97 98 99 0096 97 98 99 00

Asset QualityNet impaired assets toequity and general provisions.

The ratio has remained at3.1%, reflecting continuedsound asset quality.

8.9

5.6

5.0

3.1

54.5%

EfficiencyExpense to income ratio,before intangibles.

The ratio has continued toimprove, falling to 54.5% from57.9% last year. Expenses wereflat in nominal terms, adjustedfor one-off accounting impacts,despite the impact of Y2K andGST implementation costs,GST related cost increases, andour Olympic and Paralympicsponsorship program.Efficiency improved throughthe year with the secondhalf-year ratio falling to 53.5%.

62.9

60.7

58.4

57.9

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David Morgan Chief Executive Officer

8

Take five

“We have a long and proud history.For183 years we have been both a leaderand innovator in our industry. We intendto be at the front of the pack as we bridgethe gap between the old and new economies.Here’s our five point plan to ensure we do.”

Chief Executive Officer’s review

My second year as Chief Executive hasbeen exciting both in terms of the bank’sachievements and our involvement inonce-in-a-lifetime events.

Our role in the Sydney 2000 OlympicGames and Paralympic Games was ahighlight. Operationally we madeprofound changes to the way we dobusiness and provide customer service.Most importantly, we’ve been able todeliver our best ever financial result,achieved in the fiercest competitiveenvironment we’ve ever encountered.

In last year’s annual report I mentionedthat I’d inherited a company with solidfoundations. Much of this is due to thestrong leadership and guidance JohnUhrig has provided throughout his eightyears as Chairman. I also said that wecould now concentrate on improvingour performance. That’s what we’vebeen doing. We’re now starting to reapthe rewards of turning potential intoreality and opportunities into value.

Our Performance Enhancement Program,encompassing initiatives right across theorganisation, has delivered $300 millionin real cost efficiencies. This is providingus with the funds to invest more in thebusinesses that both provide newgrowth and continue to create real value.

During the year we outlined awell-defined customer focused strategy.This not only commits us to continuesearching for cost efficiencies butallows us to capitalise on theopportunities available to us in ourcustomer base. The strategy has fiveelements and will guide us as wecontinue to evolve from being a fullyintegrated manufacturer and distributorof financial products to a trustedprovider of financial solutions.

The key element driving our strategyis our unwavering focus on customers.We recognise that it’s only bysuccessfully satisfying customer needsand improving the customer experiencein dealing with us that we can continueto create value for shareholders.

As we move forward our challenge isto make customer primacy a reality,every day and in every part of ourbusiness, in a way that also deliverssustainable shareholder value. It’s achallenge made more difficult by thecontinuing sophistication of customerneeds and proliferation of competitors.However, we’re excited by and equalto that challenge.

Our Olympic and Paralympic experiencein Australia was one of heightened brandawareness, of participation both as anofficial partner and as the Games’ officialbanker. Our investment in the Sydney2000 Olympics has more than paid foritself. I was particularly proud of howdedicated and professional our staffwere in carrying out Olympic andParalympic associated activities.

Our investment in upgrading oursystems for Y2K readiness paid off.The moment of truth passed withoutany serious incident, confirming thequality of our extensive preparation.

Amid all of this business-focusedactivity, we continued to look forways to provide tangible support to thecommunities in which we operate andwhich support us. Various volunteeringprograms, sponsorships, and otherphilanthropic activities are part of ourcommunity development programwhich reached new heights this year.

The following pages of this report bringour strategic approach alive and providesome examples of the activities flowingfrom it.

I invite you to take five minutes to readon to better understand our strategy,the progress we’re making and howwe’re going about it.

9

1 2 3 4 5Understandingour strengths

Being moreefficient

Finding newopportunities

Getting closer to customers

Backing ourpeople

Where we create valueacross our products

Where we create valueacross our business

What we did•Undertook a major exercise to

identify value in our businesses.

•Looked at our costs, revenues andcapital requirements from all angles.

• Implemented externalbenchmarking to measureour efficiency.

•Identified potential annual costsavings of $300 million acrossthe company.

•Restructured the organisationaround the value chain.

•Set up a strategic sourcing unit tocentralise and automate purchasing.

What we plan to do•Continue to test ourselves against

external benchmarks.

•Further optimise our capital usage.

•Embed economic profit measuresacross the organisation.

•Continue to prioritise ourinvestment opportunitiesbased on enhancement ofshareholder value.

Take 1 2 3 4 5Understandingour strengths

Being moreefficient


Getting closerto customers

Backing ourpeople

To understand our strengths we’ve left no stoneunturned in reviewing our operations over thepast year. We’ve gained a better understandingof just where we’re creating value in ourbusiness and where the opportunities forimprovement lie.

PersonalBanking

Corporate &Institutional

BusinessBanking

Payments

Lending

Investment& Risk

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35%

45%

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50%

11

“ When we value-mapped our business, we found some surprises. We were spending around$1.2 billion through over 10,000 suppliers each year. We were not using our buying power aswell as we could. There were savings to be had, and although individually some savings weresmall, the team believed some $50 million per annum of savings could be found by betterusing our buying power. Better still, by moving much of our purchasing on-line, we are takingthe paper out of the many hundreds of thousands of orders, invoices and payments we carryout each year. So, by taking a closer look at our business, we have been able cut our costs andat the same time have a favourable impact on our environment.”

Saving time and trees.

Chris Hughes, Alex Holcomb, Rachel Lamb, William Ammentorp

We may have been in business for 183years, but we’ve never experienced thedegree of competition and the impact oftechnology that we’re experiencing now.That’s why we pulled our business apart,sliced it and diced it in various ways,and looked at it from every angle to geta really good understanding of how westack up against the new economics.

We compared ourselves with companiesat the frontier of good practice. Now weknow in great detail the parts of thebusiness in good shape and where ouropportunities for improvement are.

Looking across the company and ourportfolio of businesses, we found thegreatest value in our sales andmarketing activities. At the other end,we found we needed to improve thevalue of our servicing and operationsareas. Not a great surprise. But the realrevelation was in discovering that whereour resources and energies were goingwas not fully in line with where wecould generate our best returns.

With this understanding, we’vereorganised ourselves to put ourresources – both money and people –where we can best create value. We’renow shifting the balance to our frontlineactivities and the people who interactwith our customers day-to-day.

But we won’t just neglect the back officeareas. They are vital to our business andthe quality of service our customers get.That’s why we’re actively looking formore cost-effective ways to providethese support and operational functions.

We can generate benefits of scaleby taking many of these activitiesoutside the organisation, by contractingspecialised firms that can often handlethese functions better. We’ve beeninvestigating outsourcing, insourcingand joint venturing to realisethose benefits.

Within our customer groupings oursmall and medium sized businesscustomer group is not only producinghighest value compared to othercustomer groups but offers the bestopportunity to generate further value.

This knowledge is driving a determinedeffort to expand our business bankingfranchise. It includes, among otherthings, diverting resources andreinvesting savings from other areas formore training and development of ourcustomer-facing business banking staff.

We’re also introducing more efficientways to work with our business bankingcustomers. We’re making loan approvaland monitoring simpler. We’veestablished a professional call centrededicated to their service needs. Andbecause our small business customersneeds are less complex than largerbusinesses, and they often needquick and convenient responses,we established our Business Directservice to provide telephone assistanceand easy to use do-it-yourself tools.

One way we’re reducing costs is tobetter manage our purchasing. We’realso introducing eProcurement whichwill not only reduce costs further, butalso save lots of paper.

There are many more cost-saving andincome-increasing opportunities in otherparts of the business. We’re aggressivelyattacking these through this five pointstrategic plan.

Our new insights from getting to thebottom of where we’re delivering thebest returns for shareholders are nowguiding our spending, clarifying ourbusiness direction and creating thepriorities for our strategic initiatives.

one-offaccountingimpacts

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What we did•Set up the Performance

Enhancement Program to realisethe $300 million in identifiedcost savings.

•Completed the initial NetworkDevelopment Program with targetedfloorspace reduction of 30%.

•Outsourced our telecommunications,information technology andoperations to IBM GSA and Telstra,saving 15-20% on prospective costs.

•Consolidated Operations Centresfrom four to two.

•Created a Business Services Groupto provide shared professionalservices to all business units.

What we plan to do

•Implement eProcurement.

•e-enable legacy systems andeliminate paper based processes.

•Enhance the efficiency and scopeof our Call Centres.

•Explore and realise operationalefficiencies between Australiaand New Zealand.

Take

Being more efficient means we must have allparts of our business as productive as they canbe. Our customers shouldn’t have to, and won’t,pay for any inefficiences. And our competitorsare all too ready to grab the advantage wherethey see a weakness.

1 2 3 4 5Understandingour strengths

Being moreefficient



Backing ourpeople

Keeping our costs flat

How our distribution networkis changing (Australia)

How our customersmake financial transactions

14

Branches

Other90%

10%

“To try to get the best out of our businesses, an obvious focus for attention was our branchnetwork. With customers increasingly using the phone, ATMs, EFTPOS and now the internet,the traditional branch was clearly not going to be viable in many areas in the future. Closingbranches completely didn’t appeal to us or our customers, and so we went back to the futureto resurrect an idea from the 1960s. With new technology we were able to use the old thirdparty agency concept and greatly expand our services. And so in-store banking was born.”

Breaking with tradition was the breakthrough we needed.

Vikki Davis, Daniel Musson, Peter Mair, Allan Phelps, Peter Troy

15

Being more efficient isn’t just aboutdelivering better earnings, it’s the realpath to growing our business.

That’s why we’ve been working steadilyto reduce costs across our traditionalbusinesses and to improve the way wedo things. Put simply, we need run ourexisting enterprises more cost-efficientlyto have the funds to invest in new areasof opportunity.

Last year we launched our PerformanceEnhancement Program. Through this wenot only improved our processes butreduced our operating expenses bysome $300 million.

We’re leaving nothing untouched aswe bring the power of the internet andnew technologies to all our businessactivities. Through these we’re not onlyimproving our servicing and delivery,we’re doing it more cheaply.

We’re using the savings to invest in ourfuture. By being able to keep overallcosts flat we have the ideal platform toenhance our financial performance anddeliver real benefits to shareholders.

There is no better insight into how we’reimproving service while reducing coststhan how customers are choosing tointeract with the bank. Our customers areso attracted to the convenience of ATMs,EFTPOS, telephone and internet banking,they’re conducting about 90% of theirtransactions via these and other meansoutside our traditional branches. Thisproportion is increasing daily.

With customers leading the way wehad to look at whether our widenetwork of full service branches wouldadequately meet their growing needs forlower cost, more convenient channels.And it wouldn’t. That’s why we’restreamlining the costs of our face-to-facebanking outlets to make them affordablefor customers and more viable from abusiness viewpoint.

To date 105 branches have eitherbeen refurbished or moved to moreaccessible locations. In 118 instanceswe amalgamated branches that wereclose to each other and where it madesense to bring them together. We alsoresponded to our customers by givingmore than 500 branches new sales andcustomer education facilities. And inall our full-service branches we’veincreased staff training in sales andcustomer service to ensure a consistentexperience wherever our customersvisit a branch.

For places where full service branchesare not economically viable wedeveloped what we call ‘in-storebanking’. This makes sure thecommunity still has face-to-face bankingservices. Our customers like it. Theyappreciate the greater conveniencebecause our in-store banking hosts –be they newsagents, pharmacists, orother kinds of store owners – usuallytrade beyond normal banking hours,often including weekends.

From four test sites some two yearsago, we now have169 in-stores rangingacross small remote communities tosuburban metropolitan locations,including ten towns where we had nobranch. This unique, fully-branded thirdparty banking network in Australiarepresents 20% of our face-to-facebanking network.

Getting the best out of our businessdoes not stop there. It’s a never-endingtask to continue responding tocustomers’ evolving needs andemerging technology and businesspractices. By continually reviewingwhere we are, we can be ready to meetnew opportunities for efficiency andeffectiveness in serving our customers.We’ll continue to take up the challengeto be the best we can be.

What we did•Redesigned and extended our

website.

•Launched leading-edge on-line andeBusiness initiatives including:

– Westpac broking

– Internet banking in New Zealand

– Healthpay payroll solution

– SME superannuation

– Yieldbroker

– domain.com.au housing portal

– eMarket

– Online FX

– eBonds

•Purchased a 49% stake in MetiomAustralasia, a business-to-businessand eProcurement portal.

• Introduced Australia’s first WirelessApplication Protocol (WAP)banking service.

•Originated 500 personal loans and1,600 credit cards per monthon-line (equivalent to sales volumeachieved across 80 branches).

What we plan to do

•Extend our on-line offerings.

•Deliver greater personalisationand customisation.

•Deliver electronic bill presentment solutions.

•Enhance our on-line Investor Centre.


Being moreefficient



Backing ourpeople

Finding new opportunities is all about believingthe sky’s the limit and being passionate aboutcreating better solutions for our customers.

18

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Take-up for internet banking

Take-up for internet broking

Personal loan and credit cardapplications on-line

Personal LoansCredit Cards

19

“Getting to the bank can be a major logistical exercise, but banking and making paymentson-line at a time that suits is a wonderful alternative, and it’s easy to do. That’s just the kindof outcome we wanted when we developed on-line banking and extended our website to offernew on-line services such as Westpac Broking. And it’s why we made the site more interestingand easy to navigate, so that no-one would feel intimidated when visiting www.westpac.com.au,except perhaps another bank.”

There’s a lot of room to move in cyberspace.

Vanessa Pickford, Thien Lam, Emmy Riggall, John Durand, Jennifer Rufati, Ian Muir

Increasingly, the internet is becomingpart of our everyday life. Whether it’sfor communication, entertainment,education, shopping, trading or banking,the internet is being used more andmore because of its convenience.

Across Australia over 35% of adultsare now on-line and 60% of smallbusinesses are now connected. So it’sno surprise the internet represents agreat opportunity for us to expand thescope of our existing businesses andto create new ones.

Helping our customers manage theirfinancial affairs and conduct theirtrading activity is something we’vealways done. So it’s natural for us tolook for ways to continue doing thisvia the internet, and to pursue thenew opportunities it provides.

One thing’s for sure – the internet hasbrought about a shift in power to thecustomer. Customers are enjoying morechoice and access to an ever-increasingamount of information on which to basetheir buying decisions.The challengefor us, and the key to our strategy, is tobecome their trusted on-line financialpartner as they embrace the internetand expand their horizons.

And we’re responding. Over 490,000of our customers now use our on-linebanking and 51,000 are using WestpacBroking, our on-line discount sharebroking offering. And many more aretaking advantage of eMarket, our securepayments environment for on-lineshopping. Through the internet wecan now transfer funds from a WestpacGroup account to any account at anybank, building society or credit unionwithin Australia, on-line. And werecently launched Australia’s firstWireless Application Protocol (WAP)internet banking service that allowscustomers to do on-line banking fromtheir mobile phones.

In realising that more and more peopleare using the net to search for their idealhome, we’ve brought our home loan tothem through the leading real estatesite, www.domain.com.au.

Even at the big end of town we’vebeen busy with eBonds, an on-line bond distribution platform; Online FX;Yieldbroker, an on-line fixed interesttrading hub; and HealthPay, Australia’sfirst electronic service offering a totalpayroll deduction processing solutionfor employers and recipient funds.

We are committed to continuing tosupport our customers’ transactingneeds, particularly as businessincreasingly moves to trading via theinternet. Westpac is a leading providerof payment and transactional servicesin Australia and New Zealand today,with 35% of leading companies usingus as their principal provider of theseservices. We’re determined to stay atthe forefront of developments.

We’re not only enhancing our servicesusing the new technologies, we’realso creating new businesses. Ourinvestment in Metiom Australasia(formerly Intelisys Australasia) to provide an infrastructure for openbusiness-to-business marketplacetrading is a good example.

Like an iceberg, most eCommerceactivity is not readily visible. The effects,however, are already truly astonishing,even though we’re still in the earlystages of discovering what’s possible.As more and more customers areconnected, and as the scope of theirneeds inevitably increases, we believethe sky’s the limit in us becoming theirtrusted financial services provider.

0%

5%

10%

15%

20%

25%

Last year’s growth inkey products (Australia)

What we did•Made 3 million pre-qualified

offers to customers.

• Installed Siebel Systems CustomerRelationship Management software.

• Installed ENACT salesmanagement software.

•Created Business Direct CallCentres for SMEs.

•Conducted 148,000 customer needsanalysis interviews via our 545Financial Planners and Advisers.

•Achieved strong growth inkey products.

•Doubled the number of ourvaluable customers (essentiallythose with multiple products).

What we plan to do•Double the value of our customers,

based upon economic profit, overthe next three years.

•Continue to focus on customerretention.

•Extend the use of CustomerRelationship Management solutionsto all customer segments.

•Use customer scoring andpre-approvals to deliver quickercredit decisions.

•Further simplify sales processes.

•Extend our on-line offerings.


Being moreefficient



Backing ourpeople

Getting closer to customers is about gettingto really understand what makes them tick.We’re privileged to have such a large customerfranchise. But while we have a lot of informationabout our customers, we haven’t always usedit well. Now our customers are telling us weneed to know them better.

Growth in higher valuecustomers

22

Home mortgagesCredit card outstandings

Retail funds under managementGeneral insurance sales

Nov97

Sept98

Sept99

Sept00

400,000

600,000

800,000

1,000,000

1,200,000

Cust

om

ers

“Broadening and deepening our customer relationships involves just about everyone. It startswith getting our customer information organised, understanding needs, having leading-edgetechnology, putting all of this in the hands of our sales-force and finally delivering a greatcustomer experience. The technology is the easy bit – the secret is in the seamless teamwork.Knowing our customers well and deepening our financial relationships have other benefits too,like knowing where to get the best yum cha.”

Like the community we serve, we’re a multicultural lot.

Jim L’Estrange, Virginia Hottes, Eriko Kinoshita, John Horosko, Jenni Yap, Judy Ruoso, Deborah Thompson

To get a better insight into the needsof our customers, we invested intechnology to bring together all theinformation we have scatteredthroughout our various business areas.This has given us the best holisticGroup-wide view of our customersthat we’ve ever had – just what they’retelling us we need.

Each of our 7.8 million customers hastheir own lifestyle, personal interests andfinancial position, so there’s a wide rangeof financial needs we want to satisfy.

What we’ve found in all that diversity,however, is that there are some reallybasic expectations common to all ourcustomers. Interestingly, these aren’t somuch about products or price, or evenhow we deliver our services, but moreabout their relationship with us andhow we interact with them day to day.

Our customers are saying “Show me youknow me. Recognise me when I contactyou, regardless of how I contact you.Know what’s happened before. Don’tpass me off. Surprise me with yourinitiative – show you have my interestsat heart.”

Winning customer confidence and trust,which are so vital to our business, is allabout the less tangible service andrelationship fundamentals. That’s whywe’ve concentrated on meeting thesebasic customer expectations across ourentire business. During the last yearwe’ve made good progress on this front.

Meeting these expectations has meantchanging our approach to sales anddistribution. Rather than starting withproducts, geographical areas ordistribution channels, we now startwith the needs of customers.

The key to understanding their needsis to make good use of the informationthey give us. By knowing our customersbetter we’ve increased product usageacross every customer segment in thelast 12 months. During this period,for example, we delivered almost threemillion offers to customers who werepre-qualified on the basis of theinformation we have about them.

Not surprisingly, this has not onlystrengthened our relationships withcustomers but it has lifted theirsatisfaction levels as well.

As a result, over the past three yearswe’ve doubled the number of ourpersonal customers who have more than three products, and seen the valueof our business customers increase bymore than 50%.

To build on this success we’re nowusing the world’s leading CustomerRelationship Management softwarefrom Seibel Systems. This systemprovides us with a proactive approachto meeting our customers’ totalfinancial needs. And our customersare responding favourably.

The statistics are impressive and theresults are the best we’ve ever achieved.But in all of this, we’re very clear thatit’s a journey that can only be successfulif we continue to focus on what ourcustomers are telling us: “Do the basicsreally well. Continue to delight me withyour initiative. Most importantly, showyou are really with me.”

23

What we did•Introduced Westpac Learning Maps.

•CEO conducted two sets of PeopleManagement Forums with 700 ofour senior managers.

•Aligned executive remuneration toshareholder value based measures.

•Approx 50% of staff have becomeshareholders under our employeeshare plan.

•Reorganised our Training andDevelopment in line withbest practice.

•Enhanced our staff benefitsprogram.

•Opened our fourth Westpac staffchild care centre.

•Closely tracked the views ofour staff.

What we plan to do•Relentlessly embed a

performance culture.

•Address the issues raised by staffand conduct follow-up surveys.

•Continue to improve the way wecommunicate with our people.

•Get all staff to be shareholdersunder our employee share plan.

•Improve flexible workingarrangements for employees.

•Broaden understanding of thebenefits of workforce diversity.

Backing our people means rethinking how wework together to reach our goals. We can’texpect our people’s full support if they don’tunderstand why we’re doing what we’re doing.And if we aren’t all working towards the sameobjective, it’s doubtful we’ll get there.

Leadership

Competitive Position & Customer Experience

Training, Learning & Development

Work Processes/Systems

Working Relationships

Performance

Communications

0% 25% 50% 75% 100%

Staff who feel positive

WestpacGlobal financial services norm


Being moreefficient



Backing ourpeople

26

What our staff aretelling us

“ When we initially canvassed the idea of using visual Learning Maps to give our people abetter understanding of our business, our executive team volunteered to be the guinea pigs.They thought it was such an engaging experience and were so enthusiastic about the ideathat we immediately started to develop our own learning maps with US-based Root Learning,the leader in this field. The outcome has been well above our expectations. Everyone in thecompany is getting to share some of the same information the board and executives sawand can now draw their own conclusions while gaining a better understanding of thebackground to the changes affecting them. In a way, all our staff get to sit in the big chair.”

Teaching the teachers – everyone has something new to learn.

Peter Freese, Lisa Thomson, Gaby Pimstone, Louise Coughlan, Elaine Hornsby

27

If we’re to make the most of theopportunities outlined in the first fourparts of our five point plan, then wemust continue to develop our peoplewith an eye to tomorrow. We need aworkforce with an unwavering focus onour customers, adaptable to change, andable to deliver service excellence. We’llalso need to change the way we work.

This will be a massive task becauseit not only involves new skills, it alsorequires a major cultural change. Whenthe history of this period is written itwon’t only be about technologicaladvances and ordinary people’s masteryof that, it will be about the revolutionin the way people work and how theyrelate to each other in the workplace.

We are all seeing the death of theold ‘command and control’ cultureand the end of the divide betweenmanagement and staff. Now, leadersand managers are responsible forteams possessing knowledge that theydon’t possess themselves.These leadersdon’t direct, they facilitate, motivateand coach.

Increasingly, in this performance-drivenworld people need to have initiative andadaptability. In this new workplace, wemust have both the human capabilitiesand a culture that recognises andrewards success.

An important first step was to get ourpeople committed to our strategy. Thismeant giving them the opportunity tounderstand the business environmentand their part in it. We had to line uptheir individual efforts towards acommon goal. And we had to developtheir skills to deal successfully with theever increasing rate of change. We areprogressing on all three.

As an Australian first, we developed‘learning maps’ to improve understandingthroughout the organisation. The firstthree maps focus on our competitiveenvironment, on creating shareholdervalue, and on our customers. Throughthese maps our people get a greaterunderstanding of the issues thatchallenge us. From these maps they’llbe able to draw their own conclusionson what it all means for the shape ofour company’s future.

To use an old saying, this processhelps our people understand thatthey’re building a cathedral, not justcutting stone.

We’ve also been making sure our peoplehave performance objectives with clearsightline to overall business performance.And we’ve begun a formal ‘shareholdervalue management program’ to measure,manage for and reward value, so thatprofessional rewards link directly withshareholder interests.

To change behaviour we have a programwe call ‘the leadership journey’. Thisfocuses on key behaviours necessary forsuccess in our competitive marketplace.Most importantly we will be making itavailable on-line, thanks to the progressin e-enabling the organisation.

We know what we have to do to buildour organisation’s capabilities andculture to succeed. We know it’s a bigtask but we’re getting on with it.

Personnel by region (FTE)

Australia 23,711

New Zealand 5,557

Other 1,252

Total 30,520

Total assets $billion

Australia $133.7

New Zealand $24.9

Other $9.0

Total $167.6

Customers million

Australia 6.30

New Zealand 1.23

Other 0.27

Total 7.80

30

Did you know?

David MorganBEc, MSc, PhDChief Executive Officer

Appointed CEO in 1999,David has led all the majorbusinesses in Westpac,including Westpac FinancialServices, Retail Banking,Commercial Banking,Corporate and InstitutionalBanking, and InternationalBanking, since joining thecompany in1990. David hasextensive experience in thefinancial sector, havingworked in the InternationalMonetary Fund in the1970s, and the FederalTreasury in the 1980s asSenior Deputy Secretary.

Patrick HandleyBA, MBAExecutive Director, andChief Financial Officer

Appointed Chief FinancialOfficer in1993. In1997Pat was appointed ExecutiveDirector, responsible forFinance, Taxation andAccounting, Group Treasury,Risk Management, Legaland Investor Relations.Prior to Westpac Pat had23 years bankingexperience in the US.At BancOne Corporation forthirteen years, he was ChiefFinancial Officer for eightof them, with additionalmanagement responsibilitiesfor its mortgage and leasingsubsidiaries as well as itsacquisition program.

David ClarkeLLB (NZ)Group Executive, BankingFinancial Services

David recently joinedWestpac to lead thebusiness unit responsiblefor developing andaggregating productsolutions for customers.This encompasses thecredit card operation,finance company, fundsmanagement business,and personal and businessproducts. Previously anExecutive Director with theLend Lease Group, he hassubstantial financialservices experience havingbuilt MLC into one ofAustralia’s leading fundsmanagement businesses.

Jeremy GrossBBusGroup Executive, InformationTechnology and Operations

Jerry joined Westpac lastyear to advance theefficiency of the corporationand drive the eCommerceagenda. Since then he hasembarked on one of thelargest outsourcing dealsin the global financialservices sector and begunthe integration of theNew Zealand and Australianoperations. Previously,Jerry was Chief TechnologyOfficer at Countrywide inthe US, a company engagedprimarily in the mortgagebanking business, and waskey to positioningCountrywide as theglobal leader in mortgageprocessing on-line.

Michael HawkerBScGroup Executive,Australian Businessand Personal Banking

Michael was appointedGroup Executive of WestpacAustralian Banking in1997 with responsibilityfor personal and businessbanking nationally.He has worked in boththe wholesale and retaildivisions of Westpac sincehe joined us as GeneralManager, Financial MarketsDivision in 1995. Michaelhas worked with Citibankin Australia becomingDeputy Managing Director,and subsequently inLondon as an ExecutiveDirector of Citibank PLC.

Top team

Westpac at a glance

Profit by region

SnapshotRevenue by key business unit Assets by region

73% Australian Retail Financial Services

1% Other

12% Institutional Bank

14% New ZealandRetail

68% Australia

13% Other

19% New Zealand

80% Australia

5% Other

15% New Zealand

Credit ratings Short term Long term

Moody’sInvestor Services P-1 Aa3

Standard & Poor’s A-1+ AA-

Fitch IBCA F1+ AA-

Distribution Branches/In-stores ATMs

Australia 857 1507

New Zealand 209 487

Other 55 8

Total 1,121 2,002

31

Ilana AtlasBJuris, LLB, LLMGroup Secretary andGeneral Counsel

Ilana recently joinedWestpac, and worksclosely with the Chairmanof the Board and the otherdirectors. She has workedextensively as a corporatelawyer and in managerialroles including responsibilityfor human resources, andthen as the ManagingPartner of MallesonsStephen Jacques. Havingadvised many of Australia’slargest corporations andGovernments, she has beeninvolved in demutualisationsin the financial servicessector and privatisationof major companies.

Alexandra HolcombBA, MBA, MA,Dip. Fr. Bus and Cult.Group Executive,Group Strategy

With Westpac since 1996Alex has been responsiblefor the Institutional andInternational Bank Strategy,and more recently, theWestpac Group strategy.She has helped shape thestrategic choices made bythe corporation, includingthe customer-focusedstrategy. Previously withBooz-Allen & Hamilton andChase based in New York,Singapore and Australia,she has worked extensivelyin financial servicesthroughout Asia, Europeand the US for 17 years.

Harry PriceGroup Executive,WestpacTrust, PacificBanking, and PerformanceEnhancement Program

Harry joined Westpac’spredecessor, the Bankof New South Wales, inDunedin New Zealand in1961. He has had extensivebanking experience, andwas appointed ChiefExecutive for New Zealandin1992. Following ouracquisition of Trust BankNew Zealand Ltd in1996he was appointed ChiefExecutive of WestpacTrust.His appointment as GroupExecutive in 1999 hasbroadened his responsibilitiesto include Pacific Bankingand the Group-widePerformance EnhancementProgram.

Ann SherryBA, Grad. Dip. IR, Grad. Dip. ErgGroup Executive,Human Resources

After joining Westpac in1995 Ann headed theHuman Resources functionfor the International andInstitutional Bank, andsubsequently led the teammanaging human resources,change management, andpublic affairs for the mergerwith the Bank of Melbourne.She was appointed Headof Westpac Group HumanResources in1999. Ann hashad extensive experiencein Government. She wasFirst Assistant Secretary ofthe Office of the Status ofWomen, advising thePrime Minister.

David WillisBCom, MAICA, MNZSAGroup Executive, WestpacInstitutional Bank

David joined Westpac in1996 and now leads ourglobal wholesale bankingoperation, spanningAustralia and New Zealand,US, UK and Asia. Previouslywith Lloyds Bank PLC asManaging Director of itsAustralian operations, hehas extensive experiencein Financial and CapitalMarkets, Corporate lending,Private Banking andCorporate Advisory Services.This included extensiveperiods living and workingin Boston, New York, Londonand Tokyo.

0.3% 100,0001+

37.2% 1,001- 5,000

7.0% 5,001- 10,000

5.0% 10,001- 100,000

50.5% 1- 1,000

Assets by key business unit Shareholders by size

Who we are

Westpac Banking Corporation wasfounded in Sydney in 1817 as the Bankof New South Wales; and in1982 wechanged our name. With almost eightmillion customers, Westpac today isa leading provider of banking andfinancial services in Australia, NewZealand and nine Pacific Island nations.In these markets we operate throughmore than 1,100 branches and agencies.

We also maintain offices in the keyfinancial centres around the world.Across the company we provide abroad range of banking and financialservices for personal, business, andinstitutional customers. Our activitiesinclude a full range of traditionalbanking services, plus investmentmanagement and insurance, and finance company activities.

What we value

Our values represent the essential spiritof our company – our corporate religion.We have three core values.

• Teamwork Working together toachieve common goals.

• Integrity Act honestly. Do what yousay you will do.

• Performance Deliver superior results.

60% Australian Retail Financial Services

9% New ZealandRetail

2% Other

29% Institutional Bank

Market capitalisation30 Sept 2000 $23 billion

Listed on

• Australian Stock Exchange

• New York Stock Exchange (ADR’s)

• Tokyo Stock Exchange

• New Zealand Stock Exchange

92.8% Australia

0.3% US

4.7% New Zealand

0.6% Other

0.8% Japan0.9% UK

Shareholders by region

32

Australian Retail Financial Services

Australian Retail Financial Servicesrepresents the regional bank operationsbranded Westpac in New South Wales,Queensland, South Australia,Tasmania, and Northern Territory, Bank of Melbournein Victoria, and Challenge Bank in WesternAustralia, plus the Australian operationsof Australian Guarantee Corporation, andWestpac Financial Services Group.We conduct our activities via a nationwidenetwork of 857 branches, banking centres

and in-store branches, 1,507 automaticteller machines (ATMs) and over 46,900electronic funds transfer (EFTPOS)terminals, as well as a national telephonebanking service and an internet bankingservice providing 7-24 convenient access.Our retail banking operations cater forpersonal and business customers, andinclude deposit taking, transactionaccounts, credit cards, and other lending.We are a major home loan provider, and

we meet the finance needs of businesscustomers up to $20 million. Investment,superannuation, and general and lifeinsurance products are also sold throughour branch network. Australian Guarantee Corporation, ourfinance company, is one of Australia’slargest and provides motor dealer finance,business finance, personal finance, andpersonal investment products.

Private BankingLeadership position•18,000 high net worth clients

representing a growing market shareof this segment.

•Each client has a dedicated ExecutiveManager.

•Total financial services, includinginvestment planning and financial advice,customised to client needs.

Opportunities for growth•Improve competitive differentiation

through superior relationshipmanagement.

•Consolidate our client relationshipsby seeking greater share of totalfinancial services.

•Product innovation for customised andexclusive investment opportunities.

•Greater emphasis on risk managementand protection products.

•Deepen understanding and provisionof customised wealth creation solutionsfor the affluent segment.

Priority BankingLeadership position•817,000 customers and expanding rapidly

– some relationship-managed.•72 Priority Banking Relationship

Managers.•Specially tailored product offerings.•Special packages for professionals.•20% of total housing market.

Opportunities for growth•Upsell potential in the 3.8 million

personal banking customers.•Increase cross-sales to this high potential

customer base.•Deepen customer relationships

by product packaging.•More focused, timely, and coordinated

customer contact programs.•Special offers for professionals and

other high income groups based uponspecific needs.

•Improve customer retention throughsuperior customer service and targetedproduct initiatives.

Personal BankingLeadership position•3.8 million customers representing

25% market reach.•Nation-wide multi-channel distribution

network with 857 services outlets.•Comprehensive product range

with 7-24 convenient access.•Specialist offerings to market segments,

including youth and the elderly.

Opportunities for growth•Increase the number of products

per customer.•Use customer information better

to drive product offers and service.•Identify potentially valuable customers

and upsell to priority customer status. •Lower the cost to serve.•Continue to unwind historical

cross-subsidies.•Fully e-enable customer services

and processes.•Speed up our credit decisions via

customer scoring and improvedcredit scorecards.

Who we are and what we do

Westpac at a glance

33

Small BusinessLeadership position•365,000 customers. •Business Direct, providing immediate

telephone access to a specialisedbusiness banking manager.

•Professional call centre facilitiesdedicated to resolving operationalmatters for business customers.

Opportunities for growth•Realise the great potential for

expanded relationships. •Use customer information better to

anticipate and respond to customer needs.•Encourage customers through pricing

strategies to take multiple products andto bring more of their business to us.

•Broaden services and access viadevelopment of a business desktop(internet).

Middle Market BusinessLeadership position•Main bank to 18% of the market with

approximately 140,000 customers.•Full range of financial services covering

local and global operations.•Wide distribution of business banking

teams throughout the branch network.•Sector specialists, including agribusiness,

franchising, imports/exports,and property finance, providingspecialised advice.

•In excess of $20 billion committedto Australian business.

Opportunities for growth•Realise the great potential for expanded

customer relationships by meeting moreof their financial needs.

•Encourage customers through pricingstrategies to take multiple products.

•Improve sales management and salesforce productivity though CustomerRelationship Management technology and practices.

•Target industries where we have anopportunity gap, such as health andcommunity services, communicationservices, and agribusiness growth sectors.

•Use pricing strategies to encouragecustomers to deepen relationships.

Australian GuaranteeCorporation LimitedLeadership position•Australia’s most profitable finance

company with a well known andrespected brand.

•Wholesale finance provided to 250 motordealers and retail finance provided tonew and used car buyers throughdealers at point of sale.

•Leading provider of vendor finance via8,000 retail stores and specialist suppliers.

•Provides a wide range of business finance– equipment finance, vendor rental,insurance premium funding and currentasset finance.

•Funded by 140,000 personal investorsproviding $6.2 billion via a range of fixedrate/fixed term debentures, short-termdeposits and money market accessaccounts.

Opportunities for growth•Expand the product range delivered

under the AGC brand to include homeloans, insurance and credit cards.

•Increase the cross-sell to the 26,000new customers acquired every month.

•Increase emphasis on customer retention.•Apply internet technology to the point of

sale opportunities generated by morethan 8,000 intermediaries.

The detail 2000 1999 1998Profit on operations $1,075m $900m $766m(after tax)

Economic profit $700m $595m $407m

Total assets $101.0bn $81.6bn $73.8bn

Expense to income ratio 57.9% 61.1% 62.7%

Personnel numbers 22,297 25,060 25,869

Business group results

To enable a more detailed analysis ofour results, the results of our businessoperations shown on pages 32 to 35 of this report have been presented on amanagement reporting basis. Internalcharges and adjustments have beenincluded in the performance of each

business group to reflect the management

of our business rather than our legalstructure. Therefore these results cannotbe compared directly to public disclosureof the performance of our individuallegal entities or geographic disclosureselsewhere in this report.

34

Financial MarketsLeadership positions•Frequently voted the leading bank in the

domestic markets.•Consistently recognised internationally

as the leading bank for AUD and NZDexposure management.

•Leaders in industry based research.

Opportunities for growth•Develop new products in commodities.•Cross-sell WIB products/services to

smaller business banking customers.•Cross-sell structured investment products

into the retail market.•Better serve customers with internet-

enabled products.•Continue to develop risk management.

Funding (debt and equity)Leadership positions•Leading corporate bond house (Best

domestic bond house – EuromoneyMagazine – Pacific Rim Awards, July 2000;Australian bond house of the year – IFRAsia 1999; and Debt house of the year –INSTO Distinction Awards 1999).

•Well developed capability to cross-sellinto retail markets.

•Leading provider of on balancesheet finance.

Opportunities for growth•Develop a wider range of capital offerings

for retail customers.•Develop more structured products for

customers with specific needs.

AdviceLeadership positions•Specialists in Australian and

New Zealand business.•Capacity to leverage the extensive

intellectual capital of the entire Westpac Group.

•Capacity to enhance the growthstrategies of customers.

Opportunities for growth•Improve cross sales of advisory services

to transactional customers.•Use our specialised understanding of

business in Australia and New Zealandto broaden our customer base.

Transactional Services (cashmanagement and payments)Leadership positions•Leading provider of domestic and

international payment and trade services.•Principal transaction banker to 35% of

the top 500 companies in Australia.

Opportunities for growth•Leverage our strong product offering

and eCommerce position to enhanceour customers’ operational efficiency.

•Expand solutions across the supplychain to assist our customers tomanage payment relationships withtheir customers.

•Expand application and transactionalsolutions to our business customers.

Westpac Institutional BankWho we are and what we doOur Institutional Bank provides financial services to the corporate and institutional customerbase. To do this, we assist and advise in the management of cash, funding, capital and marketrisk, for companies, institutions and governments operating in or investing in Australia andNew Zealand. Our 13 industry teams assist businesses in meeting their financial needs.The strength of this business is demonstrated by the leading customer and product marketshares and the numerous other awards received. We have the highest customer satisfactionrating among the domestic major banks, and have the most nominations as principalcorporate and transactional banker to Australia’s top 500 companies.*We operate through branches and subsidiaries located in Australia, New Zealand, New York,London, Tokyo, Singapore, Hong Kong; are represented in Thailand, Indonesia, and China;and maintain correspondent relationships with approximately 1,500 international financialinstitutions in over 90 countries to facilitate trade payments and capital transactions.

The details 2000 1999 1998Profit on operations $306m $248m $180m(after tax)





Westpac at a glance

* (East & Partners, Australian Corporate Banking Report, April 2000)

35

WestpacTrust

Personal BankingLeadership position•Largest customer base of any

New Zealand bank.•150 years of serving New Zealand.•Extensive national network. •Strong community focus.•Supporter of important community

initiatives, including rescue helicopters,Life Education Trust and sports stadiums.

Opportunities for growth•Increase share of Auckland housing market.•Improve cross-selling of financial services.•Improve credit card take-up and use.•Extend on-line Banking services.•Develop more tailored product packages.•Leverage business and corporate

relationships.

Business BankingLeadership position•Commitment to supporting

New Zealand business.•Largest in SME market.•Largest provider of card merchant services.•Dominant in transaction business.•Leading provider of on-line

banking solutions.

Opportunities for growth•Leverage Government and small/middle

business relationships throughdevelopment of internet capability.

•Improve penetration of largebusiness market.

•Improve market share in agribusiness. •Integrate products and services

in targeted packages.•Leverage our relationships with

corporates and professional associations.

Leadership position•Depth of experience (Fiji Centenary 2001,

first bank in Papua New Guinea –90 years).

•Breadth of representation: nine Pacific countries.

•Low cost operations.•Local focus, global strength. •First bank to introduce Telephone

Banking to the Pacific.

Opportunities for growth•Increase distribution channels.•Leverage new branding (now consistent

with Westpac Australia in most locations).•Develop eBusiness capability.•Develop interchange arrangements

in Fiji and Papua New Guinea.•Leverage the Australian bank’s standard

operating model in all locations toachieve greater synergies and lower costs.

•Leverage Australian Investment/FundsManagement and Insurance capabilities.

Who we are and what we doWestpacTrust is one of New Zealand’s leadingfull service banks with 1.23 million customers.More than one in three New Zealanders hasa relationship with WestpacTrust. It is theleading provider of banking services to smalland medium business, and is the bankerto the New Zealand Government.WestpacTrust has 209 branches nationwide,487 ATMs, Phone Banking and Phone Assistcall centres. Its on-line Banking service waslaunched in April 2000 and already has over55,000 registered customers.

Pacific BankingWho we are and what we doPacific Banking provides a full range ofdeposit, loan, transaction account andinternational trade facilities to personal andbusiness customers. In selected locations,finance company activities such as leasing,equipment finance and motor vehicleloans are also offered. It is represented innine Pacific Island nations, and operatesthrough 55 outlets, eight ATMs and anextensive EFTPOS network.

The details 2000 1999 1998Profit on operations $250m $258m $212m(after tax)





The details 2000 1999 1998Profit on operations $31.1m $58.7m $58.5m(after tax)


Total assets $840.8m $690.8m $1,760m



(The figures above relate to retail operations in New Zealand. Anyinstitutional banking activities carried out under the WestpacTrustbanner are included in the figures for Westpac Institutional Bank onpage 34.

Operating results reflect the impact of the fall in the NZ dollar relativeto the Australian dollar over the period between 1998 and 2000.)

Documents

An old bank€¦ · in Greece. Gold Medal, 1998 Australian RowingChampionships. Bank of Melbourne MIS and Finance Assistant. Partnering our Australian Olympic and Paralympic heroes