Exhibit 1
Commonwealth Bank of Australian – Wealth Management Update
Wealth Management Update Commonwealth Bank of AustraliaACN 123 123 124Wealth Management22 March 2007 |
Disclaimer |
The material that follows is a presentation of general background information about the Bank’s activities current at the date of the presentation, 22 March 2007. It is information given in summary form and does not purport to be complete. It is not intended to be relied upon as advice to investors or potential investors and does not take into account the investment objectives, financial situation or needs of any potential investor. These should be considered, with or without professional advice when deciding if an investment is appropriate. |
2Wealth Management22 March 2007 |
Agenda |
Strategy and Priorities Grahame Petersen |
Results Update Paul Rayson |
Colonial First State Global Asset Management Warwick Negus |
Colonial First State Brian Bissaker |
CommInsure Simon Swanson |
Panel Questions |
3Wealth Management22 March 2007 |
Notes |
Wealth Management22 March 2007 |
Wealth Management Strategy and Priorities |
Grahame Petersen Group ExecutiveWealth Management |
4Wealth Management22 March 2007 |
Organisational structure Wealth Management CFS Global Asset Management Colonial First State CommInsure Finance & Strategy Risk Management & Compliance Human Resources Information Technology Notes Grahame Petersen Brian Bissaker |
Wealth Management 22 March 2007 |
Business Overview CBA Wealth Management Total of 4,430 employees in 7 countries Funds Management |
#1 in Retail Managed Funds #2 in Property Total $131bn FUM 860 FTE in Australia, UK |
and Asia Platforms & Advice |
FirstChoice fastest |
growing retail platform |
#5 in advice (CFP and |
Financial Wisdom) |
Total Retail FUA $83bn 2,060 FTE in Australia |
Insurance |
#1 in Life Insurance #6 in General Insurance (H&C) Total $1,060m in Gross |
Written Premium |
1,420 FTE in Australia |
5Wealth Management22 March 2007 |
Notes |
Wealth Management 22 March 2007 |
Our Aspirations CBA Vision To be Australia’s finest financial services organisation through excelling in customer service To Deliver Superior Investment Performance Aspiration — to exceed benchmarks, peers investment performance and our clients’ expectations over the long term. To Be #1 in Platform, Distribution and Advice Aspiration – to deliver investors and advisers great value, superior service and relevant choice. To Be The Insurer of Choice Aspiration — to provide straightforward insurance solutions to customers and intermediaries through best practice underwriting and claims management. Goal — all key funds to exceed benchmark on a rolling 3 year performance basis. Goal — to rank first for Inforce Premiums in Life Insurance and leverage the Bank to grow General Insurance. Goal — to rank first for net flows in the Plan for Life ‘Administrator’ view. |
6 Wealth Management 22 March 2007 |
Notes Wealth Management 22 March 2007 |
Our Strategic Priorities |
1. Attract, Grow & Retain Talent |
Talent development and succession planning Cultural alignment Improve safety, turnover and absenteeism 2. Get The Basics Right Simplify the business Consolidate legacy systems Improve business processes |
3. Provide Excellent Customer Service |
Sales and Service program Enhance customer experience |
4. Drive Growth Cross Sell to the CBA customer base Innovation in product and service delivery |
7 Wealth Management 22 March 2007 |
CBA vision and priorities Notes |
Group VisionTo be Australia’s finest financial services organisation through excelling in customer service Group Strategic Priorities Customer Service |
Group Aspirations |
Our customers receive excellent service from an admired organisation Business Banking We are widely regarded as the Business Banking partner of choice Our people and customers are supported by best practice technology and processes Technology & Operational Excellence Our service is provided by a highly engaged and collaborative team Trust & Team Spirit |
Wealth Management 22 March 2007 |
Alignment with the CBA group Group Strategic Priorities Wealth Management Strategic Priorities Customer Service Business Banking Technology & Operational Excellence Trust & Team Spirit 1. Attract, grow and retain talent 4. Growth through cross selling and innovation 3. Provide excellent Customer service 2. Get the basics right 8 Wealth Management 22 March 2007 |
People Measurement Notes |
Lost time injury frequency rate 2006 Annualised turnover 2006 (%) |
Aspirational Benchmark Wealth Management 22 March 2007 |
Our Progress |
Cross Sell program yielding results New fund launches and distribution expansion Continued innovation of FirstChoice |
4. Drive Growth |
Improved advocacy scores Over 50% of IFAs use FirstChoice 72% of funds outperforming benchmark |
3. Provide Excellent Customer Service |
Rationalised 9 IT systems Improved claims management Reduced application processing time |
2. Get The Basics Right |
Improved internal staff engagement scores LTIF rate down Turnover down |
1. Attract, Grow & Retain Talent |
Wealth Management 22 March 2007 |
Wealth Management 22 March 2007 Notes |
Wealth Management 22 March 2007 Wealth Management Results Update Paul Rayson Chief Financial Officer Wealth Management 22 March 2007 10 |
Wealth Management 22 March 2007 Notes |
Wealth Management 22 March 2007 Composition of Results Asset Management Australia UK Asia Funds Management Insurance Platforms Advice Life Insurance General Insurance Advice & Non-Advice Legacy Investment Business International Financial Services New Zealand (Sovereign) Indonesia Fiji HK (sold 1H06) 11 |
Wealth Management 22 March 2007 Funds Management Notes |
Wealth Management 22 March 2007 Funds Management NPAT up 27% |
Revenue growth of 25% underpinned |
by solid inflows, investment returns and stable margins |
Underlying volume expenses in line |
with revenue growth |
Expense growth supporting revenue |
generating capability |
Steady improvement in profit margins |
Funds Management Underlying NPAT 1H07 vs 1H06 Funds Management – PBT Margin 12 |
Wealth Management 22 March 2007 FUA business mix Notes |
Wealth Management 22 March 2007 FUA growth of 22% |
Growth driven by solid inflows and |
favourable markets |
Strong growth in platform business and |
internationally sourced funds |
Outflows impacted by sale of |
wholesale funds and volatility in short term investments |
Margins stable at 1.13% Retail Fund market share increased |
to 15.4% FUA Growth by Flow ($b) Total Retail Funds Market Share — Administrator View 13 |
Wealth Management 22 March 2007 Net flows Notes |
Wealth Management 22 March 2007 FirstChoice Flows Remain Strong |
Continued strength in net flows FUA grew 48% to $31bn FirstChoice increased platform |
market share to 8.2% (Dec 05 — 7%) |
Well positioned for 2H inflows |
FirstChoice Funds Under Administration Balance & Market Share FUA Market Share: Plan For Life All Master Funds – Administrator View Flagship Retail Platforms: Market Share 14 |
Wealth Management 22 March 2007 Insurance Segment Notes |
Wealth Management 22 March 2007 Insurance NPAT up 18% #¡ Total insurance segment underlying NPAT up 18% #¡ Australian underlying NPAT up 25% driven by strong growth and improved margins #¡ Operating Cost to Net Income improved from 52.6% to 51.5% #¡ Total Risk market share increased 13.7% (Dec ‘05 — 13.5%)CBA Insurance NPAT 1H07 vs 1H06 (excl HK) CommInsure NPAT 1H07 vs 1H06 18% Underlying NPAT 25% Underlying NPAT 15 |
Wealth Management 22 March 2007 Inforce Premium Notes |
Wealth Management 22 March 2007 Strong growth and improved quality |
Inforce Premium growth of 18% Major Group Risk wins Retail Risk sales impacted by delays |
in new quoting tool |
Early progress in GI sales Quality of the result significantly improved |
Commlnsure Inforce Growth Year Ended 31 Dec 2006 ($m) CommInsure Source of Underlying NPAT ($m) 16 |
Wealth Management 22 March 2007 Notes |
Wealth Management 22 March 2007 Wealth Management CFS Global Asset Management Strategy Update Warwick Negus Chief Executive Officer Colonial First State Global Asset Management Wealth Management 22 March 2007 17 |
Wealth Management 22 March 2007 Notes |
Wealth Management 22 March 2007 A global business Australia Funds under management: $98bn Staff: 500 United Kingdom Funds under management: $23bn Staff: 166 Asia Funds under management $8.6bn Staff: 104 New Zealand Funds under management $1.5bn Staff: 93 Total Global Funds under management: $131bn Staff: 863 As at 28 February 2007 18 |
Wealth Management 22 March 2007 Notes |
Wealth Management 22 March 2007 Leading Fund ManagerFunds Under Management by Asset Class as at February 2007Funds Under Management as at September 2006Source: Rainmaker (as at 30 Sept 06) 19 |
Wealth Management 22 March 2007 Notes |
Wealth Management 22 March 2007 Grow by leveraging strengths |
Attract and retain talent to support growth Use our competitive advantages |
to differentiate |
Emphasis on: |
– Innovative investment solutions – Total return strategies – Diversification of asset classes 20 |
Wealth Management 22 March 2007 Notes |
Wealth Management 22 March 2007 72% of funds outperforming 78% of domestic funds have outperformed benchmark on a 3 year basis Percentage of Funds Outperforming the Benchmark by Asset Class as at Februrary 2007 21 |
Wealth Management 22 March 2007 Notes |
Wealth Management 22 March 2007 A global leader through innovation Existing Strategies in New Markets New Strategies with Existing teams New Teams and New Strategies 22 |
Wealth Management 22 March 2007 Since Inception Gross Returns — to 28 Feb 2007 0% 2% 4% 6% 8% 10% 12% 14% 16% Wholesale Infrastructure Income Fund Infrastructure and Utilities Fund Airports Fund Fund Performance Benchmark 2-Year Gross Returns — to 28 Feb 2007 0% 5% 10% 15% 20% 25% Wholesale Infrastructure Income Fund Infrastructure and Utilities Fund Airports Fund Fund Performance Benchmark Notes Infrastructure returns |
Wealth Management 22 March 2007 Established player in infrastructure |
Strong track record since 1994 Significant international experience Investor aligned model Scale to pursue new initiatives Dedicated transaction execution team |
23 |
Wealth Management 22 March 2007 Notes |
22 March 2007 Wealth Management Colonial First State Strategy Update Brian Bissaker Chief Executive Officer Colonial First State Wealth Management 22 March 2007 24 |
Wealth Management 22 March 2007 Notes |
Wealth Management 22 March 2007 Simple yet powerful value proposition |
Great Value Superior Service Relevant Choice |
25 |
Wealth Management 22 March 2007 Notes Platform Functionality Platform Functionality Ranking — Standard* Copyright 2006 Investment Trends Platform Report. Reprinted with permission of Investment Trends Pty Limited. Source: 2006 Platform Report, Appendix A – Overall – Standard. * Ranking and rating based on 302 criteria, excludes product/wrap functionality. Additional analysis on broader rakings can be found in the 2006 Platform Report. Top 10 out of 24 platforms shown. |
Wealth Management 22 March 2007 FirstChoice delivered 50% growth |
Unique mandate structure Adviser tools New funds and features |
Platform Yearly Net Flow As at December 2006 Source: Plan for Life, December 2006 (Administrator View), CBA internal data $m 26 |
Wealth Management 22 March 2007 Notes |
Wealth Management 22 March 2007 Improving advice quality and capacity |
Transformation of advice businesses Pipeline of new financial planners Referrals from frontline staff |
27 |
Wealth Management 22 March 2007 Notes |
Wealth Management 22 March 2007 Shaping industry evolution |
Investment choice Fee choice Simplicity and transparency |
28 |
Wealth Management 22 March 2007 Notes |
Wealth Management 22 March 2007 Wealth Management CommInsure Strategy Update Simon Swanson Managing Director CommInsure 22 March 2007 29 |
Wealth Management 22 March 2007 Total Risk Inforce Premium Total Risk Inforce Premium Notes Source: Plan For Life, Sep 2006 CommInsure |
Wealth Management 22 March 2007 Strategy focused on four priorities 30 Reduced operational risk and improve systems and processes Attract, grow and retain talent Provide excellent customer service Growth through cross-sell and innovation |
Wealth Management 22 March 2007 Notes |
Wealth Management 22 March 2007 Getting the basics right is fundamental |
Simplifying processes Rationalising legacy systems Strengthening risk management |
31 |
Wealth Management 22 March 2007 Notes |
Wealth Management 22 March 2007 Upskilling people for changing demands The Changing Nature of Underwriting and Claims |
Product complexity Increased morbidity More advanced pricing |
Claims management |
Wealth Management 22 March 2007 Notes |
Wealth Management 22 March 2007 Cross sell program is delivering 73 new Branch Insurance Representatives Direct Banking sales increased Home Loan / Home & Contents Insurance cross sell rates up from 23% to 29% General insurance sales up 29%General Insurance Sales — BIR v Non BIR Regions July Aug Sept Oct Nov Dec Jan BIR — GI Actuals Non BIR — GI Actuals BIR Regions — Sales Trend 33 |
Wealth Management 22 March 2007 Notes Did you know ? |
1 in 270 cars are stolen each year Someone is burgled approximately every minute There are over 10,000 house fires each year 1 in 3 will die during their working life 1 million people experience serious injuries or illness which |
either require hospitalisation or prevents them from working each year |
Half of all serious accidents occur away from work 2 in 3 males and 1 in 4 females will suffer from a critical |
illness between age 30 and 64 |
Wealth Management 22 March 2007 What’s your most important asset? 2% 5% 9% 17% 72% 87% 87% Trauma TPD Income Life Home Building Home Contents Motor Vehicle Monthly Premium $40 $11 $44 $56 $40 $36 $92 True Value ($) 34 |
Notes Wealth Management 22 March 2007 |
Simon Swanson Warwick Negus Grahame Petersen Brian Bissaker Paul Rayson Panel Questions 35 Wealth Management 22 March 2007 |
Wealth Management Update Wealth Management 22 March 2007 Commonwealth Bank of Australia ACN 123 123 124 |