Tier 2

Conversion Following a Non-Viability Trigger Event

The primary method of loss absorption is Conversion, subject to possible Write-off. Upon a Non-Viability Trigger Event occurring, the Issuer must Convert (subject to Condition 5.3 (“No further rights”)) all or some Subordinated Notes (or a percentage of the Outstanding Principal Amount of each Subordinated Note).

If for any reason Conversion of a Subordinated Note (or a percentage of the Outstanding Principal Amount of each Subordinated Note) required to be Converted under Condition 5.1 (“Non-Viability Trigger Event”) does not occur within five ASX Business Days after the Non-Viability Trigger Event Date, then the relevant Holders’ rights and claims in relation to such Subordinated Notes or the percentage of the Outstanding Principal Amount of such Subordinated Notes to be Converted (including to payments of interest or accrued but unpaid interest, any Additional Amounts and the repayment of the Outstanding Principal Amount and, in the case of Conversion, to be issued with the Conversion Number of Ordinary Shares in respect of such Subordinated Notes or percentage of the Outstanding Principal Amount of each Subordinated Note), are immediately and irrevocably written-off and terminated with effect on and from the Non-Viability Trigger Event Date and investors will lose all or some of their investment and will not receive any compensation.

In respect of Conversion, Condition 6.10 (“Conversion: Clearing Systems, where the Holder does not wish to receive Ordinary Shares or is an Ineligible Holder”) includes a provision that enables the sale of shares, on Conversion, for cash, subject to possible Write-off.

Non-Viability Trigger Event

A Non-Viability Trigger Event will occur when APRA notifies the Issuer in writing that it believes:

• Conversion or Write-off of Subordinated Notes or conversion, write-off or write down of the Relevant Securities is necessary because, without it, the Issuer would become non-viable; or

• a public sector injection of capital, or equivalent support, is necessary because, without it, the Issuer would become non-viable.

Maximum Conversion Number

Maximum Conversion Number means a number calculated according to the following formula:

Maximum Conversion Number for each Subordinated Note =
Outstanding Principal Amount of the Subordinated Note / 0.20 x Issue Date VWAP

where:

Outstanding Principal Amount has the meaning given to it in Condition 1.1 (“Definitions”), as adjusted in accordance with Condition 6.13 (“Conversion or Write-off of a percentage of Outstanding Principal Amount”).

Issue Date VWAP means, in respect of Subordinated Notes of a Series, the VWAP during the period of 20 ASX Business Days on which trading in Ordinary Shares took place immediately preceding (but not including) the first date on which any Subordinated Notes of that Series were issued, as adjusted in accordance with Condition 6 (“Procedures for Conversion”).