Tier 2

Conversion or Write-off of Subordinated Notes on Non-Viability of ANZBGL

A “Non-Viability Trigger Event” means the earlier of:

(a) the issuance to ANZBGL of a written determination from APRA that conversion or write-off of Relevant Securities is necessary because, without it, APRA considers that ANZBGL would become non-viable; or

(b) a determination by APRA, notified to ANZBGL in writing, that without a public sector injection of capital, or equivalent support, ANZBGL would become non-viable,

each such determination being a “Non-Viability Determination”.

The applicable Pricing Supplement will specify whether the “Conversion Option” described below or the “Write-Off Option” described below applies to the Subordinated Notes to which it relates.

In your capacity as a holder of Subordinated Notes, you will have no rights to the ordinary shares of ANZBGL upon such Conversion of Subordinated Notes. For further information on Ordinary Shares, see “Description of the Ordinary Shares to be Issued upon Conversion of Subordinated Notes that are Subject to Conversion”.

Conversion Option

(a) If a Non-Viability Trigger Event occurs:

(i) on the Trigger Event Date, subject only to Section (e) below, such principal amount of the Subordinated Notes will immediately Convert as is required by the Non-Viability Determination provided that:

(A) where the Non-Viability Trigger Event occurs under limb (a) of the definition and such Non-Viability Determination does not require all Relevant Securities to be converted into Ordinary Shares or written-off, such principal amount of the Subordinated Notes shall Convert as is sufficient (determined by ANZBGL in accordance with subsection (a)(ii) below) to satisfy APRA that ANZBGL is viable without further conversion or write-off; and

(B) where the Non-Viability Trigger Event occurs under limb (b) of the definition, all the principal amount of the Subordinated Notes will immediately Convert;

(ii) ANZBGL will determine the principal amount of Subordinated Notes which must be Converted in accordance with subsection (a)(i)(A) under this section titled “Conversion Option,” on the following basis:

(A) first, convert into Ordinary Shares or write-off all Relevant Tier 1 Securities; and

(B) secondly, if conversion into Ordinary Shares or write-off of all Relevant Tier 1 Securities is not sufficient to satisfy the requirements of subsection (a)(i)(A) above (and provided that as a result of the conversion or write-off of Relevant Tier 1 Securities APRA has not withdrawn the Non-Viability Determination), Convert a principal amount of Subordinated Notes and Convert into Ordinary Shares or Write-Off a number or principal amount of other Relevant Tier 2 Securities on an approximately pro-rata basis or in a manner that is otherwise, in the opinion of ANZBGL, fair and reasonable (subject to such adjustment as ANZBGL may determine to take into account the effect on marketable parcels and the need to round to whole numbers the number of Ordinary Shares and the authorized denominations of the principal amount of any Subordinated Notes or the number or principal amount of other Relevant Tier 2 Securities remaining on issue, and the need to effect the conversion immediately) and, for the purposes of the foregoing, where the specified currency of the principal amount of Relevant Tier 2 Securities is not the same for all Relevant Tier 2 Securities, ANZBGL may treat them as if converted into a single currency of ANZBGL’s choice at such rate of exchange as ANZBGL in good faith considers reasonable,

provided that such determination does not impede or delay the immediate Conversion of the relevant principal amount of Subordinated Notes;