issuing more hybrid notes, page-2

RE: Tier 1 / Cap raising.

Here is an article I wrote earlier this month
http://ozbankers.com/index.php?option=com_content&task=view&id=26&Itemid=29

"In July, ANZ completed a $4.7Bn equity raising that involved a Share Purchase Plan (SPP) that was three times oversubscribed. Mike Smith, CEO, described it as a “strong endorsement of ANZ’s super regional strategy”. Since then, ANZ has purchased $687M of RBS’s Asian assets and $1.76Bn of the wealth management and life insurance joint venture from ING. This still leaves ANZ’s Tier 1 Capital to be approximately 9.5% (down from 10.2%), well above the RBA’s guidance. This gives ANZ significant room to purchase more EPS accretive assets, grow net assets, provide shareholder return and still maintain a cautious capital ratio. To put this into perspective, the total aggregated risk-weighted capital ratio (Tier 1 and Tier 2 Upper and Tier 2 Lower) of Australian banks in 1990 ranged from around 9.3% to 9.9%."


Using rough numbers, another $2.4BN spent buying assets would drop T1 to 8.8%... 8.8% is still comfortable and cautious... esp. if ANZ have decent T2U and T2L.

Probably wouldn't want to drop under 8.5% because of Asian exposure, amongst other things..... BUT even 8.8% should be comfortable. Having said that, 8% should still be safe, but, the public may not like it, and, more importantly, it would stop ANZ acquiring assets as it intends.

RE: NZ tax decision. Bah, Meaningless and irrelevant. less than 0.01 basis point effect.

Finally, per Page 2 of "2009 Full Year Results Investor Presentation " September 2009 T1 ratio of 9.5 includes ING and RBS aquisitions.

I can't believe ANZ dropped, even on a red day. These are a fantastic set of account that beat all expectations.

The dividend is quite reasonable too.