Westpac Banking Corporation (WBC) Earnings Call Transcript & Summary

[Presentation] Good morning, ladies and gentlemen, and welcome to the 2021 Annual General Meeting of Westpac Banking Corporation. My name is Tim Hartin, and I am Westpac's Company Secretary. I would first like to acknowledge the traditional owners of the land from where I speak today, the Gadigal people of the Eora Nation, and pay my respects to their elders, past, present and emerging. This AGM is being conducted as a virtual meeting, allowing shareholders the opportunity to participate either online or via telephone. Before I introduce your Chairman, there are a few procedural matters to explain before we formally begin the meeting. This includes the technology being used to conduct today's meeting and the procedures for shareholders to ask questions and to vote. If participating online, you'll see a split screen showing the webcast of the meeting and the presentation slides. You can make either of these larger or smaller by clicking on the Switch View button on the right-hand side of the screen. I can see many shareholders are online already. However, if you have issues with voting, submitting a question or have any technical difficulties, our online AGM guide may assist. This guide is on our AGM website and can also be accessed via the related documents button located under the webcast. We encourage you to download the online AGM guide and have it available in case you encounter a problem along the way. If you have any issues watching the AGM, you can chat online to an operator by clicking the Help Center button located under the webcast. If you need assistance with accessing the AGM online platform to vote or ask questions, please call Link Market Services on 1 (800) 990-363. [Operator Instructions] In the event of a major technical difficulty that requires us to pause or to adjourn proceedings, we will do our best to update you. This may include an update on our AGM website, and if applicable, an ASX announcement. If you are a shareholder or a proxyholder participating online and would like to ask a question, make a comment or to vote, you will need to register on the AGM online platform. To do so, please select the Information tab located below the webcast. You can then select the red button labeled Shareholder Voting and Questions. A new tab will open in a new browser, which will take you to the AGM platform. There is no need to wait for each item of business to submit your questions. And indeed, we encourage you to do so now. To ask a question, click on the Ask a Question button located either at the top or the bottom of your screen. And when submitting a question, we ask that you indicate the item of business it relates to, type your question and then press submit. Your question will be placed in the queue and questions can be up to 1,000 characters long. Please do submit 1 question, though, at a time. At an AGM, where everyone is attending in person, shareholders can listen to questions and modify or withdraw their questions in need. This is, of course, not as easy online, and it's possible that we may receive duplicate questions. If we do receive many questions that are the same or similar, we may only read out one or a selection of those questions or we may consolidate them where they are largely the same. If there are multiple questions on the same topic, and we have thoroughly responded to them, we may move to the next item of business to allow shareholders as a whole the opportunity to participate. If you'd like to ask a question, I encourage you to submit them now via the AGM platform. All resolutions at this AGM will be decided by a poll, and voting eligibility is outlined in the Notice of Meeting. Shareholders and proxyholders participating online may cast the vote at any time during the meeting through the AGM platform. Once logged in, your voting card will appear at the bottom left of the screen. Click on the Edit Card button to access the voting card. Your voting card will appear with all the resolutions listed. And once completed, the card can be submitted. You can edit your online voting card at any time during the meeting by clicking the edit card button again. Voting closes 15 minutes after the conclusion of the meeting. And at the conclusion of the meeting, a countdown timer will appear on the platform, showing how long you have to complete your vote. Please note that you cannot vote over the phone, but you can be on the phone and online at the same time. Shareholders participating via telephone can ask a question into the meeting if they do wish to do so. [Operator Instructions] You will then be put in a queue, where you can still listen to the proceedings. When it's time to ask a question, the moderator will introduce you and unmute your line so you can be heard. [Operator Instructions] For each item of business, we plan to first read the question received for that item on the AGM platform, and the Chairman will then respond. Once we have responded to these questions, we will go to the phones. We do ask that questions are relevant to the items of business of the meeting and to shareholders as a whole. Questions on customer or personal matters may not be put to the meeting. And any questions considered defamatory, inappropriate or containing coarse language will not be put to the meeting. We will also not read out incomplete or partial questions, so please take care before submitting. As a reminder, you may submit your questions online for all resolutions. I'll now hand over to your Chairman, John McFarlane.

Thank you, Tim. Under Westpac's constitution, a quorum is 50 shareholders present in person, by proxy or by representative, holding between them at least 50,000 shares. I'm informed we have a quorum present, and I declare the 2021 Annual General Meeting of Westpac Banking Corporation open. I'd like to welcome everyone joining today, and thank you for your understanding in using this platform once again. I'm personally very keen to get back to face-to-face AGMs, but we had little choice given this further year of uncertainty due to COVID-19. All of the Board are with me today, along with our Company Secretary, who you've heard from, Tim Hartin. I'd also like to welcome Westpac's auditor, Lona Mathis of PwC, who is here today. Before we move to the matters in the Notice of Meeting, both the CEO and I would like to address the meeting. For the banking sector, 2021 was a very positive year with good earnings recovery, dividend enhancements, stock buybacks and significant increases in market value. Westpac generally benefited from this environment with significant earnings and dividend recovery. Earnings more than doubled and capital was maintained at a healthy ratio of 12.3%, enabling dividends to be raised to a more normal full year payment of $1.18 per share fully franked. This also allowed us to announce the return of up to $3.5 billion of capital to shareholders in the form of an off-market buyback. However, these items benefited from lower notable items and impairment charges, and therefore, obscured an overall decline in core earnings. That followed significant but necessary cost increases to fund operational and regulatory improvement. While the decisions we made restored mortgage growth following several periods of decline, this was at the expense of net interest margin, principally due to severe competition in the mortgage market, but also due to our desire to grow our book at market. Overall, the result was disappointing, leading in a drop in our market value, for which I apologize unreservedly on behalf of the Board. However, be assured remedial action has been instituted by the Board and the management to improve performance going forward, including a plan to reduce costs materially over the next 3 years without jeopardizing investment in infrastructure and revenue opportunities. Now there's some skepticism as to whether we can achieve this cost outcome. The Board is nevertheless confident that we will be able to execute this, and we fully expect costs to be down in 2022. So why are we confident about this? Last year's total expenses were $13.3 billion. Excluding notable items, these were $10.9 billion. Of this, $1.1 billion was temporary investment associated with our Fix and Simplify programs, which we expect to roll off. Additionally, some $800 million of costs relate to businesses that are in the process of being sold, leaving an underlying cost base of around $9 billion. Accordingly, to achieve the $8 billion target in 2024 requires a net reduction in costs of 11%, and we believe this is possible given the approved plans now in place. So it should give shareholders some comfort that action is being taken on that but also to stabilize margins and lift growth in some of the higher-margin parts of our portfolio, particularly the business banking. Now standing back from all of this, on the one hand, as Australia's oldest company and bank, we're a company with strong customer franchises, good brands, staff who are genuinely helpful to customers and with leading climate and sustainability programs. However, on the other hand, it's self-evident that Westpac has and continues to face considerable challenges, many long-standing, some of which I alerted shareholders to when I assumed the role of Chairman in April last year. I indicated that we lacked strategic focus and we're operating businesses that no longer made strategic sense. Our financial returns and market share had been weakening over recent years caused by bureaucratic management processes, alongside operational and technological complexity. We were also faced with the need to resolve material, long-standing legal, risk and regulatory issues as well as discovering new issues as we carry out these investigations. Accordingly, we designed and began to implement a comprehensive and ambitious turnaround program through to the end of 2023 such that Westpac would not only be free from these issues, but performing well across the board. At the end of 2020, we announced a strategy to return to core banking and to focus on our home markets of Australia and New Zealand. We designated 9 main businesses for exit. And this has been particularly successful and faster than we anticipated. We've sold 3, announced the sale of 3 and are working to announce the sale of the remaining 3, hopefully, in 2022. We'd also been trailing the market in main bank relationships and mortgage market share over recent years, but we reversed this in 2021. However, this higher growth was at the cost of a decline in margins. And while mortgage margin pressure is an ongoing sector issue, it affected us disproportionately given our large mortgage portfolio and demand for fixed rate mortgages. We were also slower to grow business lending, which is higher margin, and I'm pleased to say that this trend is now reversing. We've also put in place plans to make the company more streamlined, more efficient and more digitally capable with significantly lower costs. This, combined with ongoing work to improve effectiveness and capital allocation, should enable us to improve performance and to return to more appropriate dividend levels. Now on a personal note, in the early days, I found Westpac's embedded culture and processes quite frustrating which made getting traction on the outcomes we really needed much more difficult. Fortunately, however, with the changes in management, this has improved considerably. 2/3 of the senior management team are new, mainly from outside the company. The move to a decentralized management system with individual accountability from a heavily centralized and collective decision system has also improved execution across the board, but particularly in key areas. Now I've been particularly surprised at our performance in exiting noncore businesses as well as improvements in culture. I believe our new team, led by Peter King, the updated strategy and the changes we are making will improve the performance and value of the company going forward. Now turning to the AGM. We have the traditional resolutions around remuneration and some updates to the constitution. Some shareholders have voted against our remuneration this year. And speaking to many, their decision was mostly due to our lower underlying performance and the view that we didn't adequately reflect this in short-term incentive decisions. Now while disappointing, I respect this view, and we will work on our remuneration structure in the year ahead, considering new regulatory requirements also as well as changing shareholder expectations. We also have 2 shareholder resolutions related to climate change reporting. These resolutions relate to our disclosure on climate change, which is already industry-leading. Of the major Australian banks, we have the greatest exposure to greenfield renewables and the least to fossil fuel extraction. We are happy with our climate change position, our action plan and our disclosures, so we're not recommending these resolutions. The Board strongly supports Westpac's approach to climate change, which has been based on science and comprehensive feedback from various experts and stakeholders. The Board and management discuss these matters at length, and we publicly disclose our commitments and action on climate change, and we update our progress twice a year. Further research, however, is also underway to develop Paris-aligned sector financing strategies and portfolio targets for 6 of our most climate-exposed sectors, representing most of our emissions. Our analysis will consider the latest developments from the International Energy Agency and the IPCC. And we're happy to be judged on our actions. We are committed to exiting thermal coal mining by 2030, with our lending to coal mining and to oil and gas extraction declining by 1/3 over the last 2 years. Any new oil and gas customers must have public Paris-aligned business goals and disclosure. Of our lending to electricity generation, almost 80% is to renewables. And we've set emissions intensity targets for electricity generation for 2025 and 2030. Now apart from our own progress, we're working to be the bank that helps customers in their transition, supporting Australia to reach net zero by 2050. Turning to the Board. There have been very significant changes in its membership over the past 2 years. During that time, apart from the change of CEO, 6 Non-Executive Directors retired from the Board and 5 new appointments were made, including my own. During 2021, Steve Harker retired from the Board due to ill health. And Craig Dunn has decided to stand down today after two 3-year terms on the board. I'd therefore like to take this opportunity to thank Steve and Craig for their contribution to the company. Our thoughts are particularly with Steve and his family as he faces a major operation. An important milestone has also been achieved on diversity, where post the AGM, we will have 40% female directors, interestingly, all of whom are up for election today. Margie Seale and Nerida Caesar are up for reelection. And Nora Scheinkestel and Audette Exel joined this year and seek election. Each of the candidates will address the meeting later. Nora, originally a lawyer, is a former bank executive. And more recently, a seasoned Non-Executive Director and Committee Chair for several major Australian companies. Audette, also a former lawyer, is Chair and Founder of Adara Group and CEO of Adara Advisors. She has been both the bank's CEO and a Non-Executive Director. Each of the directors standing for election today bring unique skills and experience to the Board and contribute to its culture. I would like to thank the Board, the executive team and all our people who have shown immense resilience over the year and embrace incredible change internally. With their support, our commitment to customers has remained constant. Most of all, I'd like to thank shareholders for your support and understand during this challenging time and for your patience as we steer ourselves to a better future. Now let me hand over to Peter King, our CEO.

Good morning, fellow shareholders, and let me echo the Chairman's welcome. For Westpac, 2021 was a year of transformation. Profit materially increased, we established the foundations needed to improve the company and we effectively managed the challenges of COVID. At last year's AGM, I shared our plan to transform Westpac. The big shift was sharpening our focus on banking in Australia and New Zealand and driving change using our strategic priorities of Fix, Simplify and Perform. Much of 2021 was focused on the Fix priority, improving risk management, addressing customer remediation and completing regulatory investigations. We've made significant progress on simplifying the company, having exited businesses, closed products and streamlined fees. While our Fix and Simplify priorities remain, our focus is increasingly turning to Perform, to strengthen our franchise, improve returns and reduce costs. I am confident the changes made over the last 18 months set us up to deliver. The scale of change is taking time and significant investment, and I'm acutely aware of the impact on shareholders, their returns and to the value of Westpac shares. Many shareholders have written to us, and I understand your desire that we move quicker to fix our issues. We will continue to challenge ourselves on speed of execution, while balancing the need to ensure that change is enduring. As CEO, I have accountability for delivering the plan. Together with my executive team, I'm confident that we will achieve our targets, particularly on reducing costs and improving returns. When I was appointed CEO, one of my first actions was to renew Westpac's purpose to focus our people on helping Australians and New Zealanders succeed. And our purpose has guided us through the pandemic as we worked to help many customers navigate the uncertainty. We provided 160,000 temporary mortgage repayment deferrals with a value of $60 billion. We processed 233,000 requests for the early release of superannuation. For small businesses, we provided 36,000 temporary loan repayment deferrals and extended more than $0.5 billion in government guaranteed business loans. And I want to specifically recognize our frontline teams who have been outstanding in their commitment to customers despite the disruption the pandemic brought to their own lives. I'm especially proud of the way that we protected customers from scams and have helped customers move to new ways of banking. As one of the country's largest employees, we adopted measures to keep our people safe during the pandemic. We introduced personal protections for those in branches and operation sites and enabled over 20,000 people to work from home. Westpac was one of the first companies to create workplace vaccination for employees and their families. And more recently, we've begun rapid antigen testing. Importantly, this helped us keep branches open during COVID. From earlier this month, employees also began to return to our corporate sites. And to protect our people, employees are required to be fully vaccinated to work at any of our sites. Together with governments and regulators, we have played our part in helping the country navigate this period, and I could not be prouder of our people's commitment. The company we are building is profoundly different to the Westpac of 2 years ago, and it needs to be. The renewed executive team is in place, with more than 70% of my direct reports either new to Westpac or to the team. We are clear on what needs to be achieved to lead the company through this formative time. Strengthening risk management and risk culture is a clear priority. And our Customer Outcomes and Risk Excellence program or what we call CORE is at the heart of this change. The program brings together over 300 activities designed to improve how risks are captured and managed, provide clarity on risk accountability and enhance oversight. We're around 1/3 of the way through the CORE program, and it will remain a priority for the next 2 years. Alongside this program, we are rebuilding our financial crime processes and systems and have dealt with all the matters referenced in AUSTRAC's Statement of Claim. We're now working to embed these changes in our businesses. As part of our Fix agenda, we are reviewing past practices and have uncovered further issues. I know these are disappointing. Nevertheless, it is vital that we work hard to resolve and close them out, to restore the trust that you and our customers should have in us. Refocusing Westpac on banking is a critical step under our Simplify priority, and we've made great progress on exiting noncore businesses. We've completed the sale of General Insurance, Lenders Mortgage Insurance and Vendor Finance. We've sale contracts for Auto Finance and Life Insurance in both Australia and New Zealand, and expect these to close in 2022. We're consolidating our international footprint, having closed subscale offices in Mumbai and Jakarta, with 3 more locations to close in 2022. Improving service by making things simpler, faster and more straightforward is a focus. And our digital plans underpin this shift with this year's highlight, the launch of our new banking app -- mobile app and improving the stability of our banking infrastructure. Looking forward, we're also testing a new payment solution for small businesses that replaces merchant terminals with a new app on their phone. Our focus on the core business, streamlined operations and increase of use of digital is simplifying the bank and improving service to customers. As the Chairman indicated, taking action to limit global warming is an urgent priority. And as a provider of finance, we have a critical role to play. We must lead in our own actions whilst helping the economy transition to net zero by 2050. We backed this by elevating climate response and our climate change plans to be a company priority backed by Board-approved goals. Of course, there's more to do and work is underway to map out what net zero requires from us and customers in high emitting sectors. Consistent with the last 20 years, we'll keep shareholders informed of our plans and progress. And climate change is a risk, but it also presents opportunities. The investment required to change the way we work and live, build new supply chains and electrify the economy is massive, and we will play our part. Turning to performance. We more than doubled earnings over the year with cash earnings up 105% to $5.4 billion, mainly from a turnaround in impairments and lower notable items. While our bottom line was up strongly, core earnings or profit before impairment charges and notable items was down 13%. This decline was mostly due to lower interest rates which impacted margins and higher expenses. Whilst we successfully restored growth in mortgage lending, this year, margins were down 7 basis points from the impact of low interest rates, intense competition and a shift to fixed rate mortgages. We also incurred higher expenses mainly related to lifting our risk management capability. Many shareholders have expressed their disappointment with our risk issues and the size of the investment to fix our management of risk. We know we have to reset our cost base, and we are already taking action to do so. And this year, as the Chairman said, we set a target to cut expenses from $13 billion to $8 billion by FY '24, and we're fully committed to achieving it. Turning to the macro picture. The Australian and New Zealand economies continue to perform well, and we expect them to bounce back as we reopen. This should drive good loan demand and low unemployment, which is a positive for credit quality. However, low interest rates and intense competition will continue to impact sector margins. For Westpac, last year saw us inwardly focused to get our house in order, and that has now changed. We are now directing more energy to customers and that will increase as we further simplify our business portfolio. While we have much to do, the changes made over the last 18 months have made Westpac simpler and stronger. And they've set us up to manage through this period to compete and to grow. And we do this with a strong balance sheet and an incredibly dedicated workforce. I want to particularly thank our people for their commitment to customers. It's been a privilege to lead them through this significant time in our history. And finally, importantly, thank you to shareholders for your continued support. We are committed to rebuilding Westpac's long-term value and improving returns.

Thank you, Peter. Each year, many shareholders submit questions ahead of the meeting. This year, we received around 223 questions with the main themes focused on financial performance, executive remuneration, branch closures and climate change. Peter and I have dealt with some of the themes from these questions in our addresses. And as Tim mentioned earlier, we asked that questions from shareholders today be relevant to the items of business and to shareholders as a whole. Questions on customer or personal matters may not be put to the meeting. Where appropriate, you may be contacted by one of our customer representatives after the meeting to discuss any such matters. For shareholders participating by the AGM platform, please submit your questions via the platform, and we will address them in turn. We'll then take questions on the telephone before coming back to any remaining questions on both the platform and the phone. So as Chairman of the meeting, I now formally declare the polls on all resolutions open. You may now vote on all resolutions. Link Market Services is the returning officer for this meeting with responsibility for overseeing the voting process. During the meeting, we will display the number of direct and proxy votes received prior to the meeting on each resolution. This will not include votes submitted on the platform today. The results of the polls will be advised to the ASX and available on the Westpac website as soon as possible after the meeting. I confirm that where undirected proxies have been given to me as Chairman, they'll be voted in favor of resolutions 2 to 5 to the extent permitted and voted against resolutions 6A and 6B. The Notice of Meeting has been distributed and I'll take that as read. A copy of the minutes of the 2020 AGM also are available on our AGM website and via the Related Documents section under the webcast. Those minutes have been signed as a correct record. So we can now move to the matters in the Notice of Meeting. I'll introduce each item of business separately and then respond to questions for that particular item. The first item concerns the receipt and consideration of the financial report, the directors' report and the auditor's report of Westpac Banking Corporation for the year ended the 30th of September 2021. As I noted earlier, Lona Mathis from PwC is here. I would like to thank Lona for her service as this is her last AGM as our lead audit partner, in accordance with the Corporations Act, which requires a rotation of the lead auditor every 5 years. I would also like to welcome Colin Heath from PwC, who will take over as our lead audit partner after this meeting. Shareholders may ask questions of our auditor on the conduct of the audit, the preparation and content of the auditor's report, Westpac's accounting policies and on the independence of the auditor. It's important, however, to note that directors are responsible for the preparation and representation and presentation of our company's financial reports. The auditor's role is to give an independent opinion as to whether the financial reports are prepared in accordance with the accounting standards and the law. Our auditor has received one written question from a shareholder, pertinent to the auditor's report. The question and answer is available under the Related Documents tab in the webcast. The auditor's written response to the question is now formally tabled for the meeting. We'll now move to questions on the financial reports. Questions on remuneration matters will be discussed in item 2. Questions on the grant of equity to the CEO will be discussed during the third item of business. While questions on the individual directors seeking election or reelection will be addressed during the fourth item of business. Questions on the amendments to Westpac's constitution will be discussed during the fifth item of business. And questions on the shareholder requisition resolutions will be addressed during the sixth item of business. As Peter and I alluded to, climate change is a really important issue for the world and for our company. I assure you, the Board has taken it very seriously. Since there are likely to be a number of questions relating to climate change, could I ask that climate-related questions be taken together along with item 6B. This will create a better experience for all not dealing with these matters twice in 2 separate or 3 separate places. So please submit your questions now in the AGM platform. And so can I now have the first question on the financial report, please?

Mr. Chairman, we have a question from Carol Limmer. "How are divestments progressing and is a good price expected? Is Panorama's current performance satisfactory? And if so, why is it being divested?"

Okay. Well, Carol, thank you very much for the question. But also I enjoyed our recent meeting. Thank you for doing that. Thank you for opening on a really positive note because this is the one area that's really outstanding and way ahead of program. And we are getting good prices, not on everything. Part of the reason we're selling them is that they are less valuable than perhaps we thought that it would be. You asked about Panorama. Panorama is performing very well on the platform side of the business, less well on the superannuation side of the business. And in fact, that BT platform, Panorama, is more than $100 billion on that platform and it's performing very well. We do have an issue there is that the costs of the digital and online platforms are superior to ours in efficiency, and therefore, we need to address that to improve the financial performance of Panorama. But actually, Panorama is performing very well. We've had some issues on that platform technologically, and we're addressing those. That's caused a little bit of a jolt, but nevertheless, it's being fixed. Can I have the next question, please?

Mr. Chairman, we have a question from Carol Limmer, "Where will major costs occur, timing of these, and how can shareholders be confident of achieving target? Is there a conflict between need for spend on compliance costs and IT upgrades while at the same time, reducing overall costs?"

Well, again, Carol, thank you very much. I have actually addressed that question, but I'll amplify it a little bit. Most of the costs have already been incurred on these programs. And so the increase from here will not be there. In fact, we're expecting those to be recovered. The cost reductions arise from 4 areas: the nonrecurrence of notables; the exit of specialist businesses, which, as I said earlier, have about $600 million in expenses; the nonrecurrence of oneoff costs on the Fix agenda, which last year were $1.1 billion in cost; and then reductions in the underlying cost base, mostly central costs and mostly head office costs. We are not reducing costs in the front line. If anything, we're trying to improve our service to customers and improve our revenue base. And so I'll repeat, underlying it all, we're targeting a cost of $8 billion by 2024 from an underlying cost base of just over $9 billion last year. Our investment in compliance and IT are part of cost plans and is vital we maintain the service there, but at some point in time, these will be behind us. Can I have the next question, please?

Mr. Chairman, we have a question from Carol Limmer, "How well embedded is the desired new culture at all levels in Westpac?"

Now one of the things about chairing a meeting is I can answer all the questions, but it's probably less interesting for shareholders. And therefore, we do have a number of directors present because it really means it's the Board that needs to address these. And periodically, I will pass the question to another member of the Board. And it will create a bit more interest for shareholders. And this is one that I think I'll pass to the Chief Executive. But I will say that we do surveys to address the culture and the program. And for the top levels of management, 3 layers, that we are now approaching the 75th percentile of all banks globally. And therefore, that is way ahead of what we thought it would be. Anyway, Peter?

Well, thank you, Carol. We use the McKenzie's OHI measure when we think about culture. And as the Chairman just said, we did see an improvement this year from a score of 70 to 74 at a headline level. That is just below the top quartile globally. So I'd say we've made progress, but we have more work to do. We certainly see great engagement in the front line with customers. One of the values that has come up strongly this year as we've run our training programs is risk management in terms of our priority for the company. Customer is not as high as what it needs to be. And performance would be the third one. So we're seeing better performance, but again, it's not where it needs to be. So what I would say is good progress, but still more work to do. And we see this as part of our 3-year CORE program to really lift the culture, particularly on risk management.

In these situations, by the way, it is often that middle and lower middle management that can be a bit sticky and that takes a bit more time to fix. Can I have the next question, please?

Mr. Chairman, we have a question from Carol Limmer, "Are clear succession plans in place for Peter King and his direct reports?"

Very busy today, Carol. Now succession is a very important priority for the Board. But succession plans for Peter King, since he's only been recently appointed, is probably a little premature. And we were going to consider it this calendar year, but we decided it wasn't the time. And therefore, it will be something we'll begin next year. It's very important with CEO succession to develop internal successes. And in fact, one of the things that we've been doing, and this is a very important responsibility for the Board, is that when we're recruiting people reporting to the Chief Executive and to outstanding people below that, these people have got to have one more level in them and some the CEO position, therefore. And therefore, when we've been appointing people, we've been very cognizant of that. Of course, when you do change the CEO, it's very important to have the best person in the world available to us. And we would normally look outside to make sure that we have the best of both, worlds inside and outside. But it's not for today, it's actually for tomorrow. Can I have the next question, please?

Mr. Chairman, we have a question from Carol Limmer, "When will the court be likely to determine in relation to 6 ASIC allegations?"

Well, I think I'll pass that one to the Chief Executive, if I may.

Thank you, Carol. So ASIC and Westpac have agreed facts and penalties on those matters. They will be presented to court next year. We believe, around April, but that's obviously subject to the court, and that's when those matters will be considered by the court.

I would just say that, and I said it in my speech, a lot of these issues, although some of them are current, they actually started quite a long time ago. One of those items went back to 2001. And it's very important that we get these behind us. The problem that we've got, though, is as we continue to investigate, we do turn over stones and new issues do arise. But hopefully, there'll be a point in time where all of it will be behind us. Can I have the next question, please?

Mr. Chairman, we have a question from Carol Limmer, "Note the extension of buyback until February. What if the share price declines further?"

Well, thank you. I'll pass that also to Peter. That said, our priority is to make sure that the latter doesn't happen.

Well, Carol, thank you for the question. In relation to the off-market buyback, that is a risk for the off-market buyback. But we have the intention to return the $3.5 billion in capital. And we also announced that if off-market is not the right structure that we would do it on market. But our course of action at the moment is an off-market offer. We've thought about the share price reducing and we've adjusted the terms of the transaction, as you can see in the scheme booklet. But we want to return that $3.5 billion to shareholders.

Over a number of years, Westpac's share count has increased, reducing earnings per share. So one of the things we want to do is reduce that share count, which is why we're considering buyback, particularly the way we've structured it rather than special dividends because we need an ongoing benefit in earnings per share, and that's why we've chosen this rather than a special dividend. Can I have the next question, please?

Mr. Chairman, we have a question from Carol Limmer, "Will hybrid AGMs, live and online, be held in future given the number of shareholders and how widespread they are?"

Well, like you, I hope not and that at least the ones that we're having today are purely online, I hope we'll see the back of. However, I think hybrid AGMs are going to be with us for some time. And therefore, at the time we will consider hybrid meetings. But I personally think it's better that we get back to face-to-face meetings as quickly as possible. We'll take a decision on hybrid nearer the time, but ideally, we really want to see shareholders face to face. Can I have the next question, please?

Mr. Chairman, we have a question from Duncan Miller Johnson, "There is some suggestion that Westpac New Zealand directors did not have sufficient expertise in the critical areas of banking, risk management and banking technology despite Westpac's board charter requiring them to have these skills. Presumably, Westpac Group directors are not efficient in the above-noted critical areas. D. Johnson, small shareholder."

Well, look, thanks for the question. New Zealand is a subsidiary of Westpac Group. And so I'll pass this -- it reports to the Chief Executive, and so I'll pass it to him.

You might want to comment on the Board question as well, Chair. But in relation to New Zealand, we have appointed new directors with those skills. So we feel like the Board, now for our reserve -- our New Zealand business has the skills that it needs. And I might pass back to you, Chair on the group Board.

Yes. Look, it's a regulatory requirement and also one of our own policies that appointments to subsidiary boards have to be approved by the Westpac Banking Corporation Board. And so we take that very seriously. But these are always on the recommendation of the Chairman of the subsidiary and also on the Chairman -- on the recommendation of the Chief Executive. So while we approved it, the due diligence was done largely by the Boards themselves and the Chairman of the subsidiary boards as well as the Chief Executive, and we were very happy with that. Where it was an important subsidiary, I met all of the candidates for the Chairman's position. And I meet the Chairman regularly -- notwithstanding the report of the Chief Executive, I meet them relatively frequently because it is very important that I understand personally what's going on and that they understand what's happening in the group as well. So thank you. Can I have the next question, please?

Mr. Chairman, we have a question from Michael Friend. "How many customers has Westpac lost? And what is the value of deposited funds lost due to Westpac not being in any way competitive in the savings deposit rates it offers to its customers?"

Okay, peter, that's another question for you. Thank you.

Well, thank you for that question. I think I might start with returns on the deposits are very low at the moment because of low interest rates in the economy. And I think that underpins the question. In terms of our performance in deposits, we've actually grown deposits very strongly. We've seen an increase in the funding provided to loans from deposits. So we've actually done well for what we needed in the deposit market. But I understand at these interest rates that the return on deposits is very low. That's something about the settings in the economy.

Can I have the next question, please?

Mr. Chairman, we have a question from Stephen Mayne. "Did any of the main proxy advisers, ACSI, Ownership Matters, Glass Lewis and ISS, recommend a vote against any of today's resolutions? Which of the proxy advisers are covering us? And has there been a material proxy protest vote against any of today's resolutions? Will you disclose the proxy votes before the debate on today's resolutions so shareholders can ask questions if there have been any protest votes?"

Well, it's been a long time since I've spoken to you because I've been in London for quite a long time. But Stephen, good to see you back. You're pretty much an expert in this area, I know. So therefore, I think you know the answer to this question is that the proxy firms prepare research on us locally and internationally, but they don't make the reports public. And therefore, we can't actually discuss them publicly. I did say, though, that one firm recommended against the remuneration report. And as mentioned in the speech, some shareholders voted against the rem report. Now one of the things about proxy votes. It's really important that shareholders individually form their own view on a situation and therefore deal with it. If we disclose the proxies in advance, then that will -- may have a disproportionately fair or unfair influence on a shareholders' vote. I think it's really more important that the shareholders have the information that all shareholders have in order to form their vote and then we'll release the proxy votes after the questions. And that, as you know, Stephen, is a very traditional way that boards and companies operate. Can I have the next question, please?

Mr. Chairman, we have a question from [indiscernible]. "I am [indiscernible] traditional owner from Narrabri. I have been banking with Westpac for around 20 years. Question to the Board, when will you stop financing Whitehaven Coal to desecrate Gamilaraay country and invest heavily in renewables in Northwest New South Wales?"

We thank you for being a customer. We appreciate it. And we won't comment, unfortunately, because of privacy on individual facilities or individual customers. But what I can say generally is that we've made a commitment to exit thermal coal mining by 2030, and we only have 1 thermal coal customer. Of course, when we go forward, and this is something that's been new for us, new metallurgical coal mining customers must have public Paris-aligned goals for us to finance them. Our total exposure to coal mining is $0.5 billion, which is 0.05% of total committed exposure, less than half of that to thermal coal. So I think in answer to your question, we will come out of thermal coal, but we can't comment on individual customers. Can I have the next question, please?

Mr. Chairman, we have a question from Stephen Mayne. "The $3.5 billion off-market buyback was meant to be closing on December 17, but you have now extended it until February 11. How many shares had been tendered at the time you announced the extension? And did you change the discount range from 8% to 14% to 0% to 10% before it had become apparent? The take-up rate would be substantially below $3.5 billion, mainly because the fully franked dividend component was going to be less than 50% of the total return for participants."

Yes. I'll share this answer with Peter. The reason we changed it was very simply the fall in the share price, that therefore, it didn't make it as attractive to shareholders. And that was the reason. And in fact, the number of people who subscribed was relatively small. But they all have the option now to change those subscriptions to the new discount period. And we've also said we want to lower the share count. And if we don't achieve the $3.5 billion by 11th of February 2022, we will launch an on-market buyback within a residual. But Peter, I don't know if there's anything.

I'd just say, Stephen, there were some early applications as you usually do in these processes, but you don't expect applications to close -- most of the applications to close to the date. We look at the analysis of different shareholders and how they -- how attractive it is. And when we looked at it, the share price, we thought the change in terms was the best thing for all shareholders.

And for that reason, that wasn't anything to do with why we changed the terms. Can I have the next question, please?

Mr. Chairman, we have a question from ABOL Pty Ltd. "Chairman, you've noted poor processes, repeated regulatory failures and the requirement to change management, change the culture and fix remediation issues. Given this litany of issues: one, what implications does this present for the 6 Board members appointed prior to 2020 who oversaw these failures; two, does this imply that Westpac overpaid previous Board and management, given based on your assessment, they were ineffective; three, how do shareholders hold existing Board and management to account given the failures of previous Board and management that you have highlighted?"

Well, thank you for your question. I did see a general point, which is that the issues have been long-standing. And in fact, if you wanted a number, most of them were built before 2019 rather than 2020. And so a lot of the directors who are on the board prior to 2020 actually were recently elected, and therefore, it's a little unfair to say that they really were accountable for some of those issues. Anyway, it's very important that Boards get renewed. And we've changed the Board with 5 new directors and 6 directors have retired. The Board has been very focused on these issues and resolving these issues some of which, as I say, go back an awful long way, some of them have gone back to 2001. So it's really important that we get these things behind us. And that's one of the reasons we've been working with ASIC, in particular, on the ASIC issues to just put those behind us and rather than drag them out so that we can actually have some blue sky on these issues. So can I have the next question, please?

Mr. Chairman, we have a question from Stephen Mayne. "The Chairman made much today the bureaucratic Westpac was before he joined the Board and how important it was to completely overhaul the management team, given the poor performance. What does that say about the historical performance of new CEO, Peter King, who joined Westpac in 1994 and had been CFO since 2014? How can Peter talk about Westpac being profoundly different from 2 years ago when he was a key executive who built the business up until 2019. Could Peter comment on what mistakes he felt Westpac made during his 5-year stint as CFO?"

Thank you, Stephen, nice try, but I'm not going to have Peter answer his own question here. I'll deal with that. We were very careful in our deliberation as to who we should appoint as Chief Executive. And if you remember, Peter was acting as Chief Executive at the time and doing a good job of it. We did have internal candidates as well. We had outside candidates and we chose the best person, which is Peter. I think though, I do agree with you that one of the things that I did before I joined and agreed to take the Chairman's role is I did a 10-year spreadsheet of the financial performance of the company, which is something I always do before I join a board. And it was fair to say that at the time I did that, which is not quite -- it's 2 years ago, the performance over the preceding 5 years had been in decline. And so it is accurate to say that there have been a declining performance. It wasn't poor and that the company, if you recall, were still trading at a multiple of book. And so relative to banks worldwide, it was doing reasonably well, but it was in decline. And therefore, it was something we had to address. Can I have the next question, please?

Mr. Chairman, we have a question from Reese Alan Matthews. "What do you think the future holds for Westpac Group if the Australian government introduces a central bank digital currency?"

Now this is something that central banks worldwide are, in fact, considering. And no doubt that will be true here and in the other places we're operating. Now nobody has done this at this point in time, and therefore, Westpac has a working group established to deal with that, as have the central banks around the world. So I do think the impact will actually be closely aligned with the onset of digitization. And therefore, that will go hand in hand with the facilitation of digitization. But I don't know if, Peter, you wanted to say anything more on that.

The one thing I'd add is, I think the role of retail banks to take deposits, lend money and do maturity transformation will always be critical in the economy. I don't see the digital currencies as fulfilling that role. Certainly, in payments, there's a lot of different opportunities and disruption coming into payments, but I think the core business that we do will be needed. I haven't seen anyone from the Reserve Bank talk about that, taking on that maturity transformation role that banks do. That, I think, will stay.

That, as Peter said, the private ones are very different to those issued by central banks. And therefore, if it is issued by a central bank, it then becomes effectively the currency of the country. Can I have the next question, please?

Mr. Chairman, we have a question from Rita Mazalevskis. "Chairman, read the recently established Board, Legal, Regulatory and Compliance Committee. Last year, you and Mr. Marriott said nonfinancial risk required specialist attention and that you increased the scope of the committee to cover nonfinancial risk in general, including compliance, conduct risk, financial crime risk, customer complaints and remediation and other risk activities. Also, so there could be additional board focus, legal, regulatory and broader compliance matters, which were previously covered by the Board Risk Committee were transferred to the BLRCC. Given ASIC has recently launched further multiple legal actions against Westpac for continued widespread breaches, do you think the BLRCC is effective enough to cope with Westpac's continued serious breaches and the committee members are sufficient in numbers and experience to have oversight of these serious matters? Rita."

Rita, thank you very much. I mean you've clearly done your homework here. But I'm very happy with the performance of the BLRCC. I'm actually going to have Peter Marriott, who is with us today to comment as well because he's actually a subcommittee of the Risk Committee. I'm very happy. And in fact, the resolution of those ASIC matters were brought forward by the current BLRCC, which is performing incredibly well and is operating very effectively. We also, if you could recall, we changed the management of these matters and allocated them to a different group executive at the same time. And therefore, we thought it was very important to mirror that specialization at the Board to improve the oversight of nonfinancial risks and financial crime. Peter?

Thanks, Rita, and thanks, Chairman. I guess, I can certainly reinforce that the BLRC has been working very effectively. The matters that you referred to, Rita, the ASIC has recently raised, were in fact matters that mostly existed before the BLRC was actually even established. And indeed, the BLRC has been presiding over those matters they've gone to ASIC and then through the processes there. The BLRC has focused a lot during the current 12 months on the financial crime, which you call was a key matter for us, and has progressed that very well to the point we're feeling much more comfortable about our controls over financial crime. So I feel the BLRC has been working effectively.

Now of course, we -- any refunds or remediation to customers, we've done, and we've apologized to those customers. And we've dealt with the majority of these issues anyway. The reason for the delay is that ASIC, in order to extract penalties from the group, they have to go through the courts, and that takes time. Could I have the next question, please?

Mr. Chairman, we have a question from Michael Friend, "How many high net worth customers have been lost to our competitors, and what is the value of funds lost from those customers as a result of the decision to take away personal business bankers and replace them with a call center?"

I'll refer that to the Chief Executive. Thank you.

Well, thank you, Michael. In relation to that particular issue, I think if I look at the mortgage portfolio, we've actually -- where a lot of the businesses, we've actually grown that in deposits. But if there is a particular issue that you'd like me to look at, please write to me and I can engage with you directly.

Can I have the next question, please?

Mr. Chairman, we have a question from Stephen Mayne. "The pledge to cut costs from $13 billion to $8 billion by 2024 is incredibly ambitious. How much are we currently spending maintaining our Australian branch network? How large was our branch network at the peak after the St. George acquisition? What is it down to now? And what will the numbers likely be at the end of 2024?"

Well, thank you, Stephen. I will pass the branch question to the CEO. And you're right, the cost target does look ambitious when you look at it going from $13 billion to $8 billion. But as I've explained, if you take the underlying costs rather than the increases in costs that we've had to fix and simplify things as well as those businesses that we're selling, it actually means that the challenge isn't as ambitious as we thought. And I think perhaps we could have done a better job perhaps explaining that in advance to shareholders because the market has probably seen this as ultra ambitious, whereas when you really stand back from it, I don't think an 11% reduction over 3 years is particularly ambitious. But Peter?

Well, Stephen, our physical branch network is changing. It's around 98% of transaction actually happen outside the branches now, so 2% in the branches. On your question, I think from memory, it was 1,100 or 1,200 branches or about 840 in Australia at this point in terms of branches. And we've also added the Australia Post 3,500 points of presence as well. So we've expanded through the Australia Post relationship. In terms of where that settles in 2024, it will be lower. We haven't outlined what that looks like because it really depends on customers and digital adoption. But certainly, what we see in the bank and across the economy is fast uptake of digital. So branches will always have a role, but they're changing in that role, and they'll be more about helping customers with particular needs as opposed to service and maintenance, which is really going digital at the moment.

I mean, Stephen, it's going to go the way of checks in a sense that the branch net will be used for customer service in problem-solving areas rather than for basic transactions. The number of checks now used in banks is absolutely minimal. And so that said, I think it's very important that clients have a face-to-face offering. Can I have the next question, please?

Mr. Chairman, we have a question from Craig Caulfield. "Good morning, Mr. McFarlane. Westpac genuinely engaged with us in introducing fairness and model litigant principles. These principles add a degree of fairness when a customer has a serious, long-standing or legal dispute with Westpac. As a founder of Bank Warriors, I am privy to many victims fights with banks. They are invariably unable to match the financial firepower and legal expertise of Westpac. Would the Board please consider adopting a quality of arms as recommended by the Attorney General so that a victim of banking malfeasance when in a legal fight with Westpac has an equal opportunity to fund preparing and presenting their case? As a footnote, thank you to Company Secretary, Mr. Hartin, who engaged with us regarding amendments to make access at virtual AGMs for shareholders easier during these difficult times."

Okay. Thank you very much. And I know Peter will want to comment on this. But we do use model litigant procedures for our consumer or small business customers. We like to have complaints dealt with at the moment with the individual accountable for the customer. And most of our issues get resolved that way. When they can't get resolved, they pass through an independent body inside the organization to resolve them, completely separate from those who are responsible from a profit and loss so that the customer gets a fair hearing. But, Peter?

The only thing I'd add, Chairman, is that is the role of AFCA. And I know Mr. Caulfield that you think it needs to be improved and we'll certainly work to have the appropriate -- AFCA process improved. And if we do have a long-standing matter, we do look to deal with that through the customer advocate is the other angle as well.

I mean I've been doing just a long, long time. And my experience of the internal ombudsman or the independent people who research on balance, they find for the customer rather than for the company. And so I think this has been handled properly. Can I have the next question, please?

Mr. Chairman, we have a question from Mauro Lombardo. "With regards to the buyback, who is responsible for this as it has been a significant failure and has not been equitable to retail shareholders? Will there be some accountability on how this has been executed?"

Well, thank you for the question. Look, I don't think really that given the fall in the share price, we really didn't have any choice here but to amend the terms. And as I've said earlier, is we really do want to reduce the share count, and that's something that shareholders have been raising with us every year for some time. And therefore, it's really important that we do, do the buyback rather than any other means. We have, in fact, increased the dividend, of course. Shareholders are now getting a franked dividend yield of well over 7% now. And so we are rewarding shareholders. Ideally, we would have preferred a higher share price. So we've amended the terms in order to make sure that there's a good chance of it being executed. We've changed the discount rate. It was 8% to 14%, it's now 0% to 10%. There's more of a chance now that, that can happen. And we've given people much longer time to consider this. And it also -- it gives the market more time to digest information coming out of Westpac. Peter, was there anything else you wanted to add?

No, I think we've responded to the conditions. And from a shareholder perspective, all shareholders will benefit through a lower share count.

And we'll also benefit because we're going to buy back the stock at a lower price, if you recall. So can I have the next question, please?

Mr. Chairman, we have a question from Rita Mazalevskis. "Chairman, Westpac divested Pendal and BT Investment Management, which whilst owned by Westpac, it sold its own manufactured products. Due to serious conflicts of interest, has Westpac initiated any investigation into these serious matters? And is a remediation process underway for innocent-affected customers? Rita."

Rita, thank you. I will ask Peter to comment, but I'll just say one thing is when we think of some of these long-standing issues, regulatory and customer issues. Those ASIC issues, most of them were not in the commercial bank. They were in the businesses that we've either sold, are preparing for sale or were looking to sell. And so these businesses have had more than their share of these issues. Anyway, Peter, I wasn't here in 2007, so...

Yes. Thank you, Rita. The sale of BTIM was because of a strategic decision. There were no issues or concerns with that business. And in terms of the superannuation business, which was -- BTIM was an investment for them, they managed that process, and I'm not aware of any issues with conflicts of interest.

Can I have the next question, please?

Mr. Chairman, we have a question from Daisy Gardener. "Westpac is no longer a Workplace Gender Equality Agency Employer of Choice and is not on the list for the 2020 to 2022 application group. Being an Employer of Choice recognizes progress on gender balancing leadership, gender pay equity and preventing gender-based harassment as well as other important measures. Why is Westpac no longer an Employer of Choice for Gender Equality?"

Peter might add a comment here, but we are compliant with WGEA Statutory Reporting. And therefore, we are effectively implementing that. We work closely with them, and we provide our submissions to the gender equality reporting. But we're doing pretty well here. We've got 50% women in leadership. We've got 40% of the female senior executives are women. We joined the investor-led 40-40 vision initiative, and we've improved the diversity at the Board. But I don't know if there's anything specific you want to add, Peter.

No, there's many organizations that report on this particular matter for us. As the Chairman said, it's about being a good employer for women. We're focused on not only representation at Board executive but through the company and leadership. And also we've reviewed the pay gap and there's no significant pay gaps in terms of pay levels between males and females.

Next question, please.

Mr. Chairman, we have a question from Daisy Gardener. "What is the Board doing to ensure there are improvements on gender equality into the future, including best practice sexual harassment prevention and response measures?"

The Board does review this on an ongoing basis and actually has set requirements of women in leadership, which we are already meeting because we already have 50% women in leadership. We've got a new program underway to further strengthen that position on gender. We've got stand-alone sexual harassment policy in line with legislative changes and 2020 Respect@Work report recommendations. And all leaders in the company, including the Board, have been through sexual harassment training in the last 6 months. Peter, I don't know if there's anything you want to say here because it's, in general, it's a management matter.

Yes. I'd just add that one of the major developments this year was we added a no bias standard policy into the policies that the Chairman referred to -- And that is a signal from my perspective of no tolerance.

Can I have the next question, please?

Mr. Chairman, we have a question from Daisy Gardener. "Do you know whether any Board Directors are member of clubs that choose to exclude women?"

The answer is I have no idea. But in general, these are for people themselves. I'm certainly not a member of a club that doesn't have women members. In fact, I'm members of 3 clubs, none of them in Australia, believe it or not. And in fact, all of them have women members. So -- but I don't know the answer and it's actually a matter for each director. Can I have next question, please?

Mr. Chairman, we have a question from Rita Mazalevskis. "Chairman, could you and the Board confirm the banking code of practice continues to form part of Westpac's relevant suite of lending contracts today, which provides consumers safeguards and protections that aren't set out in the law? Rita."

Well, Rita, this is easy. Yes, it does form part of relevant contracts. Thank you. Can I have the next question, please?

Mr. Chairman, we have a question from Mauro Lombardo. "With such a significant failure of previous and current Board members and senior executives, what is the cause of action to hold these leaders accountable?"

Look, the Board is accountable for what goes on in the company. And as is the management. If management needs to do better, then we set programs, and then we measure them against those programs and hold them accountable. If they fail, then we change them. And that is a normal management discipline. It's a normal discipline by Boards. I also get annually a Board review, which includes feedback on -- independent feedback on individual directors, and I have a meeting with each director and I discuss the review with those directors. And so we do hold individual directors accountable for the performance on the Board, not individually because it's the Board as a whole that's responsible for the company, but not individually for matters, individual matters. Can I have the next question, please.

Mr. Chairman, we have a question from Stephen Mayne. "Westpac has slipped from being close to the most valuable Australian Bank after the St. George acquisition in 2008 to now being the fifth most valuable bank having even fallen behind Macquarie Group in recent weeks. As the former CEO of ANZ, could John McFarlane please comment on what has led Westpac to be the worst-performing major bank for shareholders over the past decade?"

Well, Stephen, well, I agree with you, this hurts, okay? And it's not the right position for Westpac. Traditionally, with our business mix, we've always expected Westpac to sit around the #2 position. Now that excludes Macquarie, who are in a completely different business. But relative to the other major trading banks. That would be the traditional business. But when I stand back from it, a number of things have happened at Westpac that I wasn't aware of when I was outside the organization, but I've become aware of since I joined the organization. The first is that we've lost market share in a number of our areas. Secondly, if you looked at the return on equity and return on tangible equity, which you I know are pretty familiar with because you're a former analyst, Stephen, that, that if you look at the period prior to my joining, that had actually on an annual basis, been declining partly due to increases in capital requirements from a regulatory standpoint, but partly due to our own making. And so it is true that in a number of ways that the company hasn't been performing. Now it's only recently that we've shifted from that #2 position, and that's largely been a result of our return on tangible equity, which is sitting below the comparable majors. And therefore, the recent result, which we've explained already and the return on tangible equity level currently, which we need to improve, have been a major factor in the rebalancing of that rating of the organization. What we need to do is completely reverse that, get into businesses that we really should be in, get out of businesses that we shouldn't be in, and which are rerouting value and then improve the way we run the enterprise for shareholders going forward. So can I have the next question, please?

Mr. Chairman, we have a question from Carol Limmer. "It's Carol Limmer, ASA. We have over 1,500 proxies and over 9 million votes, equivalent to the 13th largest shareholder, what is considered the biggest positive factor in Westpac's current performance and what is the poorest?"

Well, thank you for the question. I'll keep this really simple because I've answered quite a lot of it. The Westpac still has a fantastic customer franchise. Also, if you look at the last 2 years, we've made an awful lot of progress in an awful lot of areas. And therefore, that's been really good. Now I mentioned specifically the exiting of noncore businesses. Of course, the challenge that we've got is twofold. At the macro level, we've got an awful lot on. And we've got to get all of it right and we've got to get all of it done. Now given that where the share price has moved to, which obviously has affected shareholders, that has pushed performance and shareholder value right to the top priority going forward. Can I have the next question, please?

Mr. Chairman, we have a question from Michael Friend. "A follow-up question, please. Mr. King, in your answer to my earlier question, you've blamed lower market savings, interest rates, that is a given. Could you please answer the question as to why Westpac savings interest rates are lower than almost every one of our competitors?"

I will have the Chief Executive address this. Thank you.

Well, thank you, Michael. I think we are competing in deposits in different ways. Certainly, the key people that we look at are the other major banks. And some prices will be higher and some will be lower. So I understand it's a tough time at the moment in terms of being positive, but there will be offers that do match competitors.

Can I have the next question, please?

Mr. Chairman, we have a question from Rita Mazalevskis. "Chairman, Directors usually receive an induction pack upon appointment, among other things. This includes a letter agreement, which the director countersigns which usually sets out the directors' powers and duties and obliges directors to comply with relevant laws, policies, procedures and codes. Does this process apply to Westpac's directors? If not, how are they appointed? And how is the directors conduct and performance assessed and measured throughout their appointment?"

Well, Rita, thank you. You are absolutely correct here that this process does apply to us. New directors do receive an induction pack setting out the conditions of appointment. And the Board's performance, as I've said to another question, is assessed annually. And individual directors do get feedback from the Chairman following the Board review. And all of this is set out in our Corporate Governance statement. When we're looking for new directors, I like Boards to be relatively intimate so that you don't have to be in a queue to make a comment or ask a question. And so it's finding that sweet spot between the right number of directors and not having too many. And I think we're pretty -- getting pretty close to that by the end of next year, if we don't change any appointments with retirements this year and next year, we'll probably end up with a Board of 9, which is pretty good for Westpac, and it actually does increase the level of intimacy on the Board. Now of course, the Board has got to fulfill all of its obligations. And therefore, we need directors who are skilled in the major factors that the Board has to deal with. And therefore, the mix of the Board is assessed by the Nominations Committee of the Board, which I chair, and we determine the specification of the type of directors we want. Then it becomes a matter of identifying individual directors. We always search for directors because some people do approach us. And in fact, some of our existing directors that we've appointed did approach us and have been appointed. But in general, it comes from outside through a search process. It's very rigorous search process. It's -- there is a rigorous process by the Nominations Committee to make a recommendation to the Board. And in fact, we ask individual Non-Executive Directors and the Chief Executive, if they would like to interview a candidate who is applying to join the Board. And in general, that is granted. So we have a very, very thorough and rigorous appointment, and I think we have a very good Board. Can I have the next question, please?

Mr. Chairman, we have a question from Josh Kirkman. "As the CEO of Surfers for Climate, my job is to mobilize as many surfers as possible and help them take deeper and more meaningful climate action. It's baffling that as a bank committed to the Paris Climate Agreement and helping create positive social and environmental impact, Westpac just months ago participated in a $600 million loan for Beach Energy. As a lifelong customer of the bank, I won't be sticking around if Westpac decides to continue funding Beach Energy. My mother has worked for the bank for over 2 decades. And when she soon retires, I will be retiring my financial relationship with Westpac as a result of your current lending practices, too. When will the bank call off its funding arrangement with Beach Energy and commit to not funding any new oil and gas infrastructure or extraction in Australian waters? My experience with Westpac has been great, but if you can't change, I'll change for you."

Well, Josh, thank you. I hope you don't go and do stay with us. Now I actually don't know whether we do or do not have an arrangement with Beach Energy. But I don't think it's appropriate for privacy reasons for us to discuss any individual customer or any individual exposure. It's just not appropriate for us to deal with it. But I can deal with the generality of what you raised. And I'll be quite blunt here. But the easy decision for this Board and this bank is to cease financing all fossil fuel exposures and put this issue out of the way. It's the easy decision, and it's happened to a number of European banks who have done that. But given Australia, it's not the right answer. And that the country does need us to finance various parts of the sectors, including electricity generation. And we know that gas is going to be with us for some time to come in order for baseload fuel, et cetera. And we're not going to be able to do with renewals immediately. So we've taken the view that we want to reduce our exposure to fossil fuels, and we've cut it by 1/3. And we're coming out of coal, as you know. It will continue to reduce as time goes on. But we want to honor our obligations to the industries that we serve, the customers we serve and work with them through their own transitions as well as our own, which we think that is the right answer for the customers, and it's the right answer for the customer. But we'll end up in the same place as you want us to get to eventually, but just not now. Can I have the next question, please?

Mr. Chairman, we have a question from Stuart Palmer. "The Chair and CEO have referred to investment in risk management and progress on culture change. We are 3 years on from the conclusion of the Banking Royal Commission and 6 years on from the Paris Climate Agreement. While resolution of the latest ASIC proceedings may have been accelerated with the help of the BLRCC, those proceedings raise ongoing questions about managers, failing to elevate issues for action and about underinvestment in preventing, identifying and fixing problems. Will these concerns and incidents still continuing into 2021? On climate strategies and targets for high-emission sectors like oil and gas are still being deferred to future years, the latest peremptory report suggests an organization still struggling with compliance and staying the course. How does the Board and management assess whether it is on track with its transformation and that sufficient investment has been made?"

Thank you for your question. I've just answered a question on climate change but I said I wouldn't answer until later on in the proceedings. However, I did answer it because you asked it. But -- so I'm not going to cover the climate change aspect of what you say here. We'll deal with that. Now with respect to compliance, it's a very, very important issue for the organization, as you can see from the number of issues that we've had from the AUSTRAC matter ongoing. And therefore, not only do we have management processes that have been upgraded and are continuing to be upgraded and a number of work streams. In fact, there are 19 work streams with 327 activities, 149 of which have been completed. That program is overseen by the management, the CEO, but also by the group executive who's responsible for that area, but also by the Board, the Risk Committee and the BLRCC Committee. And so this is getting a lot of attention, a lot of oversight and a lot of time. These committees sit for several hours considering these matters. And I can assure you, this is being treated thoroughly by the Board and by the management. Now hopefully, gradually, these items get put to bed, our capabilities increase. And therefore, this program, all are things being equal, we expect to be completed by 2023 and ongoing up until that point. So we've made a lot of investment in this area, in risk management, and we're comfortable with the amount that we're spending. And if anything, as we're fixing items, we really want that number to come down and to improve returns. Can I have the next question, please?

Mr. Chairman, there are no further questions from the online platform. The first telephone question is from Dr. Peter Sainsbury.

Sorry, I was just making myself a coffee. So I just need to return to my computer. I have 2 questions both related to the annual report, Mr. Chairman. Page 29 of the report shows that our exposure to the retailing and distribution of oil and gas increased by almost 60% year-on-year from $1.3 billion in financial year 2020 to $2.1 billion in financial year 2021. I know it's inconsistent with the trend of our overall oil and gas exposure which has decreased by 20% from $7.5 billion in financial year 2020 to just over $6 billion in financial year '21. So what's driving this increase in exposure to oil and gas retailing and distribution? And do we intend our exposure across all oil and gas subsectors to decline moving forward in line with our commitment to the Paris Agreement? So do you want to answer that? Or would you like me to ask my second question?

No, we'll answer that question. We do expect them to decline, but I'm going to -- A, I want to thank you for reading the annual report. And B, I will pass the question to Peter.

Peter, there was one particular large transaction -- proposed transaction with a customer related to M&A, which was in our exposure at the end of the year. The transaction didn't go ahead. So that will actually reduce this year. But as the Chairman said, these areas will be reduced down, but it was one particular transaction that drove that increase. There were some small increases in other customers, but that M&A transaction was the particular one.

Next question.

Forgive my ignorance, what's M&A?

Mergers and acquisitions.

Proposed acquisition, apologies...

One company wanted to acquire another company and asked us to finance that.

M&A. Question 2, again, Page 29 of the annual report and under the heading Mining Exposure, we reported our exposure to oil and gas extraction is $2.4 billion in 2021. But this thing is different to one reported on the same page, under the heading Energy Sector Value Chain, where just to sort of explain, your exposure to oil and gas extraction and exploration is reportedly about $2.2 billion, basically adding up $1.84 billion and $0.33 billion, a bit of rounding. So this is a bit confusing for a simple soul. Is our exposure to oil and gas extraction $2.4 billion or $2.2 billion?

Thank you. I mean, fortunately, our Chief Executive was the former Chief Financial Officer.

So it's exploring for oil and then someone actually extracting oil. I missed the nuance to the question, sorry. So if you add them together, you're looking at exploration and extraction. So looking for oil as well as extracting oil. I don't know if that helps or not.

He's basically saying the 2 numbers are correct and consistent. Well, can I have the next question, please.

Mr. Chairman, we have a question from [ Jean Christi for Linda Wilson ].

The International Energy Agency stated earlier this year, that no new fossil fuel projects could be approved in order to achieve net zero by 2050. In larger base, [ Trembell ] Westpac commit to provide no further finance the company such as Woodside and BHP who are planning to develop controversial [ carbon ] gas field of the Western Australian Coast.

Well, [ Jean ], thank you for the question, which I've answered in general anyway, and that we can't comment on individual exposures. But also that I think we're doing a good job as the least exposed bank in this area, and we're making very big reductions and we'll continue to make big reductions in our exposures. Peter?

And any...

But unfortunately, I can't comment on the specific question you raised. But in general, we're getting lower and lower exposures as time goes on, which we think that's the right answer. Can I have the next question, please.

Mr. Chairman, we have a question from Glenn Walker.

The United Nations and International Energy Agency have both clearly said that Australia needs to stop burning coal for power generation by 2030 to meet the goals of the Paris Climate Agreement. Given the bank supports the Paris Climate Agreement, will the Board commit to aligning its climate policies with this 2030 deadline as soon as possible by not funding companies burning coal beyond 2030? And specifically, will the Board commit to not funding AGL or its proposed spin-off company, Xcel Energy, unless that company brings forward the closure of its coal burning power stations from 2035 and 2048 to at least 2030?

Well, again, I'm not going to comment on AGL or any other customer. And we're fairly public that we -- we'll have no thermal coal exposure beyond 2030, but we will continue to finance metallurgical coals in the meantime. Peter?

I think the only thing I'd add is 79% of our lending for electricity generation in Australia and New Zealand is to renewables now. And obviously, we will work with these customers to be Paris aligned in terms of working with their transition.

Yes. We actually will require the customers to be Paris aligned and for their disclosures to be adequate in order for us to consider financing transitions and helping them with our transitions. Can I have the next question, please.

Mr. Chairman, we have a question from Jack Bertolus.

It's Jack Bertolus. And I'm from Market Forces. According to analysis from Market Forces, since 2016, Westpac has loaned over $2 billion to 14 companies developing new or expanded fossil fuel projects. Earlier this year, the International Energy Agency concluded that achieving the global goal of net zero emissions by 2050 leaves no room for new fossil fuel supply projects. Yet Westpac continues to threaten -- sorry, yet Westpac threatens to continue its track record of funding companies like Whitehaven Coal, Santos and Woodside that are actively developing massive new and polluting coal and gas projects. For example, major gas producer and Westpac customer, Woodside, recently announced its intention to develop the largest gas project Australia has seen in a decade. Over its lifetime, emissions from the Scarborough, Pluto project would total 1.6 billion tonnes of CO2 equivalent to 15 coal-fired power stations running for 30 years. As the bank supposedly committed to net zero emissions by 2050 and the Paris Agreement, when will Westpac commit to stop funding companies whose business plans are consistent with the failure of these climate goals?

Now, Jack, you do know you're going to speak to us later and exactly on this subject. And therefore, we'll take all of that then notwithstanding, we've already answered the question that we're not going to talk about the individual exposures. And we've explained our policy position very clearly. But you're going to get another crack at this one anyway later in the meeting. Can I have the next question, please?

Mr. Chairman, we have a question from [ Marie from McCosi Investments ].

I have 2 questions. My first is approximately half of Australia's largest super funds by assets under management, have divested from thermal coal and some are cutting investments in oil and gas producers across their entire funds. I'm asking this question at item 1 because climate change is a material business risk and therefore, appropriate for consideration at this item. So my question is, BT Super's default option still has no fossil fuel exclusions. Will BT Super continue to lag its peers in this regard? Or will it move to a leadership position by divesting from all companies pursuing fossil fuel expansion, which is incompatible with the Paris climate goals?

We will actually deal with the generality of this question, [ Marie ], later on. But Peter, is there anything you can say about BT?

Well, I think the first thing is the superannuation business has its own independent Board, which has to meet the requirements. So that's where the decision is made, and they make it in the best interest of shareholders. We'll certainly provide the feedback to that Board. From the group's perspective, superannuation is one of the businesses that we will be divesting out of the group portfolio. So we don't see it as a long-term issue for the group in terms of superannuation investment.

Well, thank you for your question. Can I have the next one, please?

Mr. Chairman, we have a question from Sally Hunter.

I'm Sally Hunter, and I'm calling in from my farm in Narrabri in Northwest New South Wales on Gomorrah Country. I'm a long-term Westpac customer and my local renewable energy company is also a long-term Westpac customer. Thank you for clarifying that you only have $1 billion -- $0.5 billion of investment in coal mining companies now. But from my calculations, that means 22% of that investment would be with Whitehaven Coal, who is a pure-play coal company with no plans to transition. You have stated that you will exit thermal coal by 2030. But in terms of Whitehaven's Narrabri underground expansion that will seek extra investment from you soon pending approval, they've been telling us locally very proudly that, that will keep the mining well beyond 2040. It's worth noting that this expansion will produce only more thermal coal, and it will be a large [indiscernible] of Scope 1 and 2 emissions. I'd like to raise with you what a poor choice and investment that this company is, Whitehaven along with its associated entities has so far had 46 breaches, fines, official caution and penalty notices in the last 9 years. 46 is not a normal way of doing business. This is a systemic calculated and planned method of operating. It's a conscious decision to break the law, do the illegal activity and accept the fine as part of the cost of doing business. Their most recent environmentally and socially reprehensible behavior was being found guilty for stealing surface water for more than 3 years during the height of the worst drought in living history. This was a deliberate proactive action to steal water whilst the rest of us suffered the drought. By providing finance to an environmentally and socially reprehensible company like Whitehaven, Westpac Board, staff and shareholders are part of the problem. The standard that you walk past is the standard that you accept. We invited Westpac staff to meet with 4 of my neighbors and myself earlier this year, but this was not responded to. I hope this will happen in the future. My question to the Board and shareholders of Westpac is, when will you hold financing environmentally and socially reprehensible companies such as Whitehaven Coal and its associated entities?

Again, Sally, you know the answer, it's by 2030. And it will be declining between now and then. Can I have the next question, please?

Mr. Chairman, we have a question from [ James William Sibil ].

In May, the Federal Court found that the Minister of Environment has a duty of care to protect young people from the harms caused by climate change. As climate changes is a material business risk, I believe it's appropriate to consider this question under item 1. In his judgment, Justice Bromberg found that evidence demonstrates that a reasonable person in the position of the minister [ would cause feedback ] by reason of the Vickery project effect on increased CO2 in Earth's atmosphere and a consequential increase in global surface temperatures. Each of the children is exposed to risk of death or other personal injury. The Vickery coal project is being developed by Whitehaven Coal, a company Westpac loaned $110 million to in February 2020 as part of a syndicated $1 billion facility. Whitehaven has indicated it will seek to refinance this facility in 2022. I am one of the young people that brought the class action against the environment Minister Sussan Ley over the Vickery extension project. What risk assessment of Whitehaven has Westpac conducted and will this be updated to consider the risks of death and personal injury outlined by the Federal Court? Given Whitehaven's intention to refinance its debt facility in 2022, will Westpac commit not to refinance this deal and rule out funding for any other companies pursuing new coal mines and expansions?

Well, thank you again. As I've explained several times, I can't answer that question. But I recall, we will exit thermal coal by 2030. Can I have the next question, please?

Mr. Chairman, we have a question from [ Abigail Shepard ].

My question is about legal risk to Westpac. Other questions have referred to the International Energy Agency reporting that in a plan to achieve net zero by 2050, there's no need for investment in your fossil supply. And you have said widely that Westpac is committed to managing its business in alignment with your support for the Paris Climate Agreement to the need to transition to net zero emissions by 2050. What I want to ask you about is about the additional legal advice that we've had from Noel Hutley SC and his colleague. In April this year, that was published by the Center for Policy Development about corporate legal obligations in connection with climate issues. That advice clearly identifies how important it is for companies to have a reasonable basis for their statements about climate goals and targets and about the risk and legal consequences of greenwashing that is making inaccurate commitments or without a reasonable basis. Now despite this, Westpac has continued to support fossil fuel projects and including some new ones. And I'm well aware of your target that you're going to get out of fossil -- sorry, thermal coal by 2030. But in the light of the matters that I have referred you to and Mr. Hutley's advice, are you concerned about Westpac having engaged in greenwashing?

Thank you for your question. I've got the Chairman of the Risk Committee and the Chairman -- and the Chief Executive here, who will maybe able to help with this. But I think the one thing is all our policies are legally scrutinized. And therefore, this is no exception.

Well, I think just on disclosure, we're following the TCFD guidance in terms of disclosure, and we believe that we are disclosing appropriately so you can see what exposures do we have, and we had a question on that before. In relation to other disclosures that we make, we carefully consider the basis on which we're making all disclosures, including environmental disclosures. So it's treated seriously, and our commitments are treated seriously as well.

Can I have the next question, please?

Mr. Chairman, we have a question from [ Helen Adel Danes ]. Mr. Chairman, we'll move to the next question. The next question is from Julien Vincent.

My question goes to Page 30 of the 2021 sustainability supplement, where it states that from this year, we expect new oil and gas and metallurgical coal customers to have publicly disclosed Paris aligned transition goals. And there's an inconsistency that gets created with this because we've also said we will wait another 2 years before establishing the criteria for sectors representing the majority of our finance emissions, which includes oil and gas companies. So what this inconsistency mean? Is Westpac can continue funding oil and gas majors like Woodside and Santos? And I'm not asking you to comment on client relationships. I'm more than happy to clarify to everybody that there is [indiscernible] a relationship Woodside and Santos. Both of these companies are pursuing massive new gas projects, which undermine the goal of net zero emissions by 2050, which we are signed up to commit to. And the next 2 years will determine when these projects proceed. So can you provide any rationale as to why an exemption has been created for existing clients in the oil and gas sector to have another couple of years to -- within which they could conceivably lock in billions of tonnes more CO2 emissions before they're required to demonstrate any sort of alignment with Paris, which to date they've shown no intention of doing?

Julien, look, I do appreciate you asking questions related to item 6 and item 1. And we all know that this hasn't to do with our financial report, has to do with climate change is the thrust of your question. Peter, I don't know if there's anything specific.

I just -- Julien, thank you for the question. We did add the new requirement this year, as you referenced in your question for new clients. And in relation to our approach to oil and gas, we're doing the work now. So that is one of the sectors, 1 of the 6 sectors that we're doing the heavy lifting and analysis on now, and that will build into our future refresher plans.

Can I have the next question, please.

Mr. Chairman, we have a question from [ David Graham Chadwick ].

Good afternoon. My name is [ David Chadwick ] I'm from [ Canemeral ]. Over the last 40 years, I have operated as a livestock and property agent across the Eastern half of Australia. We also have a family farm of about 10,000 hectares, which we produced amongst other things, over 100,000 serving of beef per day, 365 days of the year. Our business is only one small cog in the wheel that feeds the world. But if we're going to continue to keep producing food, we need you to stop funding the companies responsible for what we consider the single greatest threat to rural communities. And, therefore, food production, coal seam gas or CSG for sure. We call it mother nature's melanoma. A particular concern is Santos is now Pilliga CSG project, which is proposed for the most sensitive recharge zone of the Great Artesian Basin. The proposed APA Western Slopes Pipeline in Queensland, Hunter Pipelines facilitate this risk. Not only will these projects contribute to global emissions, but they threaten the Great Artesian Basin, which is the only secure and unpolluted water supply of 23% of Australia. There are plenty of alternative sources of energy, but there are no alternative sources of food. With further inflation of 30% and forecast to rise further, we need to consider what's going to our children and grandchildren's lunchboxes. Has the bank considered the threat of CSG and associated infrastructure to food production and the consequence of the opportunity costs? And whilst I note your previous comments about your 2030 position, shouldn't you, therefore, with the food production issues in mind, consider completely stop funding these companies, proposing and developing these dangerous CSG operations and their associated infrastructure within our communities?

Well, David, your point is well made here. And as I've said before, an easy call for us is to have shorter AGMs by not being in this exposure at all. And -- but the trouble with that is that there are a range of positions here from those who wish an acceleration of the reduction and those who wish us to continue to finance. And of course, some of this is consistent with government policy, both federally and in the States. And so whatever we do here, we're going to be in trouble with somebody. And so we're trying to find the best position here. And I think we've done reasonably well here. Firstly, we do have targets. Secondly, they're Paris aligned. And thirdly, nearly 80% of our lending is to renewables and not to fossil fuel. So in finding that middle ground, in all honesty, I think we're doing a pretty reasonable job and we're doing a better job than some of our competitors. So can I have the next question, please?

Mr. Chairman, we have a question from [ Peter Star ].

It seems 2 years ago, when a number of our shareholders -- and I represent a number of shareholders. I'm also a private equity adviser, and I'm representing clients of the bank as well, my clients. 2 years ago, we talked about fixing issues within the bank and culture and fixing -- so we wouldn't be [ seen ] all over the television. Well, you tell me Mr. McFarlane, and you, Mr. King, what has changed? We have to have Channel 9 dragged Westpac because we can't get our person's home loan right, then we have to compensate them. And who release the funds and overseeing the Bill Papas scandal as it become known as? Who's sowing off on all that nonsense. And then on top of that, we've got $1.3 billion of write-downs. And to further top it off, Mr. McFarlane, I know this isn't your doing, you've only come in. And we've lost -- we've got rid of 6 directors who were probably seeing the wheel of the Board, but there's no accountability here. Who is going to put their hand up and take accountability for the Papas scandal? Who's going to take the -- put their hand up and take accountability for the $1.3 billion write-downs that the bank had to do?

Yes. Well, look, I'm not sure who's the most frustrated here, you or me. And that I actually agree with you here that these things shouldn't happen. And although I've said before, a lot of them are very long-standing even the AUSTRAC matter, which was the $1.3 billion, went over a very long period of time in history. And so it was discovered prior to my time, but the cost of it is in my time. So it is actually very frustrating. And of course, I won't comment specific -- even though it's public on the fraud you mentioned, that these things shouldn't happen. And I can tell you when those do happen, there is accountability, certainly in the management team. I don't think there's any individual director who's accountable for individual matters. But look, I agree with you. This is incredibly frustrating for me. It's frustrating for the Board. It's frustrating for the Chief Executive, and it shouldn't be happening. Now the -- I've said another thing, a lot of these issues have arisen in stuff we don't want to be part of. And therefore, we're dealing with that strategically. And that will be the bulk of the -- certainly the asset-type issues. So that's one we are dealing with it. The other way of dealing with it is not making mistakes in the first place. And when you've made them, dealing with them quickly and making sure they can't happen again. Now we've got an enormous program and a lot of cost because you've seen the fix -- I said to you that the fix had $1.1 billion in costs alone in 2021. So we're throwing a lot of bodies and a lot of money and a lot of Board time at actually trying to get to the end of this. And the only thing I can say to you is it is actually getting better, and that there are less issues as we knock an issue on the head, unless we find a new one, which we do find because we are uncovering stones, things gradually get better. Now I can't promise you and no bank can promise you. We're not going to make any mistakes because that's just not the real world. What we've got to do is be better than everybody else, and that's our mission. I don't know if the Chief Executive wants to say -- well, look, you're absolutely correct. You're within your rights to be frustrated here. I think I'm more frustrated than you are, but I'm more accountable than you are. And therefore, we've just got to get this done. Can I have the next question, please?

Mr. Chairman, we have a question from [ Marie from McCosi Investments ].

Page 20 of our sustainability supplement states that BT Super was recognized for industry-leading sustainable behavior and genuine commitment to responsible investment principles. However, I was unable to find any information on BT Super's investment holdings. Unlike other super funds, I can't see for myself what BT funds are invested in. So how do I know whether it's sustainable or not? And when will the Board commit to transparency and disclose the list of companies that BT Super's money is invested in?

Okay. Well, we'll have Peter deal with it. I mean one of the things that I can say is that, hopefully, by the -- sometime in the next year or so, it won't be a Westpac matter.

Yes. I think -- so obviously, it's the subsidiary Board, not the group board that makes the decisions on investment given it's mostly superannuation. And I understand that there's further disclosures on the BT website, and they understand they follow the TCFD exposures as well in terms of exposure to fossil fuels.

Thank you for your question. Can I have the next one, please?

Mr. Chairman, we have a question from [ Peter Star ].

Thank you, Mr. McFarlane. You're absolutely right. You can feel the frustration in my voice because I'm representing my clients and the stakeholders and shareholders. We're absolutely frustrated. 2 years ago, you promised that these things are behind us. And yet we've got now being taken to court because we've taken money from dead people. I mean I don't know how much -- The frustration here is really, really -- and I appreciate you acknowledge my frustration, you appreciate the question. I'm representing the people that have asked me to represent them because they're shareholders or they're investors in the bank, Mr. McFarlane. There needs to be some real accountability here. On another point, it should be noted that Mr. Adrian Ahern, who's your group customer advocate, you might want to elevate him a little bit. I've got nothing but praise for him. I've got to tell you, whenever I phone him, he comes back to me straight away. And I've got a challenge for you, Mr. McFarlane and for you, Mr. King, find some time to have a meeting with me, okay? It's good enough for your group customer advocate, Mr. Ahern, to return calls and speak on all, any matters. So that's my challenge to you, gentlemen.

Well, that's an easy challenge. Of course, we'll meet you. And we need to make sure we've got your details so that we can arrange it. But it will either be physical or it might be by video depending on circumstances, but we can do that. The other point I would make is -- I mean you can't make some of this stuff up, to be honest. It's completely unreasonable. Some of the things that have happened here. And therefore, I'm as bamboozled as you are with respect to some of this stuff. And we just -- now I never promised that we would solve it. And remember, as it is in 2 years, I haven't actually been here 2 years, but I didn't promise we could solve it in that time because we knew it was going to take longer and a lot of money and particularly some of the regulatory issues. And of course, we're finding new ones, hopefully, not as bizarre as some of the ones that you've referred to. But hopefully, gradually, we sort of get to the end of this and get the company back on track. But look, very happy to meet you, and I think it will be interesting. So please, let's make sure we can do that. We'll make sure one of us does it, whoever is appropriate at the time that, if that's all right. Peter knows more about the company than I do, as you can imagine. So -- but I'm very happy to meet you if that's what you want to do. Next question, please.

Mr. Chairman, we have a question from David Payne, "Does the bank generally earn a relative higher return on finance provided for oil gas development or retailing activities?"

The answer to that, I will answer, and that is -- I know it doesn't. It actually generates far higher returns in retail, which is partly one of the reasons we're reallocating capital away from lower-return segments to higher-return segments. Can I have the next question, please?

Mr. Chairman, we have a question from [ Peter Star ].

Just so you're both aware, Mr. Ahern has all my details and I'm sure he'd be happy to facilitate that. So I thank you for that on behalf of the people I represent. Thank you for your candid answers, it's appreciated. I want to pay my respect to Stephen, who's got to undergo the surgery. I hope he's been -- I wish him well. I hope he can make a recovery and our thoughts are with his family as well. Please, Peter, you're the CEO of the bank. When these things were going to happen, you're going to leave the bank you as Chief Financial Officer, you've now stayed. You've been now gazetted in, you have to look at management. You have to find out why these things are still happening, Peter. It's not good enough that Channel 9 drags us screaming and kicking because a loan application can't be processed properly, they lose their deposit and it's through the full of Westpac and then news compensate them, and should never have happen. And if you don't have those details and you know across it, I suggest that you talk to the group customer advocate because he's across it.

No, I know the matter, Peter. And I appreciate your comments and we're -- the management team is doing all that we can to line up about -- around customer and improve our policies, processes and technology. We don't always get it right, unfortunately, but we do get it right in a lot of times. But you rightly highlight a case that shouldn't have happened.

And Peter, it's no excuse, but a lot of the issues that have been arising have been in businesses that we no longer want to be in. And therefore, I know there'll be a drop dead time on all of those because we won't be in them. I mean we'll have some indemnification for certain aspects. But in general, that will make it a lot easier to run a business that we know how to do much better than what we've been doing in the past. And thank you for your compliments. Can I have the next question? Thanks.

Mr. Chairman, we have a question from Rita Mazalevskis. "Chairman, when Westpac provides a customer an unsuitable incorrect loan, this can be a complex financial arrangement by the bank and maybe in another currency and can have detrimental impacts and causes the borrower to suffer actual losses, including through increased interest, fees and charges, depending on the Australian dollar due to foreign exchange markets, which can be volatile. The amount owing under the facility can increase significantly and Westpac may enforce a credit limit reduction if this occurs. This causes the customer unfair significant financial harm. Does Westpac alert their customers of these errors? And how does Westpac address, rectify and compensate their customers who relied on the financial expertise of the bank in the first instance?"

Rita, thank you for asking a foreign exchange question, given I used to run foreign exchange. And so I know a little bit about it. And you're making absolutely the right point, is that if it's in a different currency and credit limits are struck in our local currency, then this risk is real. But Peter, I don't know if there's anything you want to say.

Well, Rita, it feels like an issue that Westpac had in the past. I'm not aware of that issue now. But I'm certainly happy to hear from you if there are specifics that I need to look at.

Okay. Can I have the next question, please?

Mr. Chairman, we have a question from Carol Limmer. "It's Carol Limmer from the Australian Shareholders Association. We have over 1,500 proxies with over 9 million votes equivalent to the 13th largest shareholder. What currently concerns the Board Chair the most with Westpac's current performance and what is being done to fix it?"

Well, thank you, Carol. I've actually -- you've asked this in a different way earlier. And so I'll just simply say this that we've got a lot to fix here in terms of creating a better performance for the group. And as I said before, the key thing is to identify these things, put programs in place to fix them, make sure they happen and then get it done and put it behind us. But as I also said, what concerns me the most is the bulk of that. But in particular, our financial performance needs to be improved. Next question please.

Mr. Chairman, we have a question from [ Marie Cavolf ]. "This is a finance and funding question. Dr. Lucy Watt is an emergency physician and a long-standing customer of Westpac. In 2017, when Cyclone Debbie struck the Northern part of New South Wales, where she lives and works, her patients, colleagues and Dr. Watt herself were flooded in at their hospital. For 3 days, she worked in the ED, providing care for severely ill patients who had no choice but to ride it out. Months later, Dr. Watts community are still seeing the effects of Debbie in people who had lost loved ones, livelihoods and homes. Despite the climate crisis Australians are already experiencing, Westpac is still willing to provide finance for Australia's biggest carbon polluter, AGL, who intend to keep polluting until 2048. And so on behalf of Dr. Watt and other health concern professionals like her, will Westpac agree to stop funding energy companies whose policies are not in line with combating climate change?"

Well, again, thank you. I've answered this several times. And yes, we actually are reducing funding to companies whose policies are not in line with combating climate change, as you suggest, and that will be stronger and stronger as time goes on. Can I have the next question, please?

Mr. Chairman, we have a question on the telephone from [ Peter Star ].

Mr. Chair, given that we had the $1.3 billion in write-downs, if those write-downs didn't occur and had those impairment charges, what would the dividend really look like for shareholders? That's the critical thing here.

Yes. Well, look, I don't think -- I'll give it to you in a minute. But Peter, I don't think it specifically would have affected the dividend for 2 reasons. One, in the first half of last year -- the previous year, we weren't allowed to pay dividends at all. And the second half, we were able to pay a reduced dividend, which obviously would have been reduced by any charges. I think the fact that we've paid out the maximum and with respect -- or near the maximum with respect to our payout ratio, that I don't think that specifically has caused us to have a lower dividend payout for last year. And because I think we would have -- probably have stuck to that payout ratio. No, we might have had more to payout.

Peter, it's a bit of a technical answer, unfortunately, but the majority of those assets that were written off related to goodwill and software capitalization, previous expenditure, which were already deducted in our capital ratio. So it had no impact on our Common Equity Tier 1 or our excess capital, if you like. So it didn't really impact our capital position. Therefore, hasn't impacted the size of the dividend or the buyback.

Although the size of earnings generally does -- because of the dividend payout ratio does influence the size of the dividend also. Can I have another question, please?

Mr. Chairman, we have a question from [ Helen Adel Danes ].

I'm [ Austin ]. I'm on behalf of Helen. I'm a young person from Melbourne. I'm from School Strike for Climate, a national organization that has young people from all across Australia with our biggest strike getting 300,000 young people involved. I, like so many young people from all over Australia, are concerned about the climate crisis. Young people will see the effects of climate change caused by fossil fuels. That's why my question is, when will Westpac commit to stop funding new fossil fuel projects and instead focus on the transition to clean renewable energy?

Well, thank you very much, and you've obviously got a big organization there behind you. Look, the answer is we're doing the right thing as far as we can judge at this point in time. We're making the right progress. And I think we'll end up in the right place, but perhaps a little later than you would like us to. Can I have the next question?

Mr. Chairman, we have a question from Mauro Lombardo, "How will Westpac rein in costs across the group?"

I'll let Peter answer that. But essentially, we've got a massive cost reduction program in place, and we set targets on that for this year, next year and the following year. And those have all been approved by the Board, and we will monitor that progress is made in line with those. Peter?

4 areas I'd just highlight. The first is improving our risk management, our control framework. We'll see lower notable items. So that's the first large bucket. The second one is as we exit the businesses we want to exit, we will see the costs reduce. We'll get some capital back as we sell. The third bit is less one-off investment in the fixing of risk management. And then finally, the reduction of the $9 billion cost base to $8 billion. So Chairman and I went through that in our upfront remarks, but there's 4 buckets that we're particularly focused on there.

I mean, look, it is the right question because this is a -- if we execute this, which we believe we will, this is a massive increase in profitability, which is, therefore, gives us more capacity for dividends and for capital returns for shareholders. So you're raising the right point here. Can I have the next question?

Mr. Chairman, we have a telephone question from [ Peter Star ].

Just to pick up, I appreciate what Mr. King had to say in response to my last question, Mr. Chair. But what should be noted here is the AUSTRAC fine was cash paid out -- When we got that fine from AUSTRAC...

That's right.

And that -- Yes, so that does affect the dividends. One other -- and one other thing, Mr. McFarlane, and this is probably to you, Peter, what other outstanding legacy cases is Westpac, whether they be individuals or whatever, are we working on? And is the group customer advocate being given the pound to get those things fixed and resolved, so we can get those matters off the books as in your words, it's settled, so we can move it forward. I remember 2 years ago, and this is before Mr. McFarlane came. Now I know he has had experience as the CEO of ANZ. But given the fact that we suffered so badly through that AUSTRAC debacle and the terrible things as investors and customers and everything else in the bank, what an absolute disgrace that was. And you know that, Peter. So thank you.

Look, just a general point. I mean, we would rather not have paid that fine, as you can imagine. But it was the only way that we could just put this matter behind us. But, Peter?

Yes. So you're right on the AUSTRAC fine. And certainly, at the time of the 2019 AGM, I expressed how disappointed that I was, both in what happened in the company and what we did to kids, that was -- it was bad. But looking forward, we've got to invest to improve the risk management, which we are, and we've sorted out the financial crime piece and got it up to a level that we need. Now we need to do the same in the bank, assuming that we are successful in exiting the businesses that we want to exit. And that needs us to get back to running a great bank, running it well, running it end to end, focusing on the customer, and that's what the program is about. In relation to outstanding matters, there are still a few. We note them in our contingent liability report. And in relation to agent and customer matters, we will work through those. He calls me if he needs to. He has full delegation to sort matters out. And often, he does without calling me. But if he needs to get me involved, then he just calls me. So Adrian does a great job, our customer advocate, and we've still got a few issues which are outlined in our contingent liability in Directors' report.

Yes, Peter, anything up to the 30th of September that's material is disclosed. It's already been disclosed to you. It's only items that arise subsequently, which we hope are reducing. Can I have the next question, please?

Mr. Chairman, there are no further questions for this item of business.

Well, thank you. We'll now move to the items of business requiring a vote. Shareholders were able to vote directly on the resolutions ahead of the AGM as an alternative to casting a vote via the online platform. Valid direct votes will automatically be counted in the poll on each resolution. Proxy forms and direct votes received before 10:00 a.m. Sydney time on Monday, the 13th of December '21 have been placed in the returning officer's possession. All members participating in this meeting and their validly appointed proxies, attorneys, representatives are eligible to vote via the AGM platform, subject to the voting rules and have been entered into the voting register. If members need any additional assistance on how to vote, please refer to the online AGM guide or contact link on 1 (800) 990-363. If you leave the meeting early, please submit your votes first. Voting closes 15 minutes after the completion of the business of the meeting, and that completes the first item of business. The second item of business is to adopt the remuneration report for the year ended 30th September 2021. If you'd like to ask a question on Item 2, please submit it now through the AGM platform. [Operator Instructions] Under the relevant legislation, the vote on this resolution is advisory only and therefore, nonbinding. While the poll on the remuneration report has not been completed, based on votes already received, more than 25% will be against this resolution, which means that we will incur a first strike on this item. As mentioned in my address, having spoken to many shareholders, we understand the reasons for this outcome, given performance was below expectations. So while voting on this resolution is advisory, we do take shareholder feedback very seriously, and we'll continue to engage with shareholders to meet your ongoing expectations.

So I'll now take questions on the 2021 Remuneration Report. And can I have the first question, please?

Mr. Chairman, we have a question from Mauro Lombardo. "With Westpac spending $1 billion on Panorama, who is being held responsible for these decisions and failure on delivery and profitability?"

Peter, this is a highly technical matter. And what happened here was a system change where we were trying to put into a more effective platform, which was the cloud. And unfortunately, as does happen in these circumstances, it actually didn't institute appropriately, and it caused an outage, which was unfortunate and for which we apologize. Peter?

I don't think there's anything else to add other than it was a complex issue. And it took us too long to find, and we did make available alternative mechanisms for people to trade and refunded the fees for the week and the following week.

Next question, please.

Mr. Chairman, we have a question from Stephen Mayne. "Well done to Westpac for producing its first AGM transcript last year. Given the interesting discussions across a range of topics today, including on this remuneration report, could the Chair undertake to make an archived copy of the webcast plus a full transcript of proceedings available on the company's website? A number of companies, including Nine Entertainment, Afterpay, AGL Energy, ASX, CIMIC, Domino's Pizza, Freedom Foods, Lendlease, Mineral Resources and Mirvac have produced AGM transcripts for the first time this year. Will Westpac stay ahead of this group by producing a second AGM transcript after today's meeting?

Yes, absolutely, Steven. The transcript of the meeting will be available on our website as soon as practical after the meeting. Can I have the next question, please?

Mr. Chairman, there are no further questions for this item of business.

Well, thank you. The direct votes cast and the position of proxy votes received on item 2 prior to the meeting will now appear on the screen. As you can see from the proxies, there's 29.71% votes against. These votes, of course, do not include those already submitted on the platform today or about to be submitted. Any proxies received before the start of the meeting today aren't material. As the meeting Chairman, any proxies given to me will be voted in favor of this resolution, unless specifically directed otherwise. However, in accordance with the Corporations Act, other than the proxies granted to me as the Chairman, all key management personnel and their closely related parties are not eligible to vote on this resolution and will abstain from voting. Key management personnel includes the Directors. Key management personnel and their closely related parties are, however, permitted to exercise a directed proxy on behalf of a person entitled to vote on this resolution. And I'll now formally propose the following resolution, which is to adopt the remuneration report for the year ended 30th September 2021. If you haven't completed your voting card for this resolution, please do it now. Only eligible voting card holders can vote on this item, and that completes the second item of business. The next item of business is item 3, seeking shareholder approval for the grant of performance share rights under the long-term variable reward plan for the 2022 financial year to the Managing Director and CEO. If you'd like to ask a question, please submit through the AGM platform [Operator Instructions]. A summary of the CEO's incentives are in the Notice of Meeting anyway with further detail in the remuneration report. Now the Board believes it's important for executives to receive a high portion of the remuneration as performance-hurdled equity rather than in cash. This encourages longer-term increases in performance and more closely aligns their interest with those of shareholders. The Board recommends this resolution to you, and I now ask if there are any questions on resolution 3 relating to equity grants to the Managing Director and CEO. And can I have the first question, please?

Mr. Chairman, we have a question from Stephen Mayne. "When disclosing the outcome of voting today, including on this LTI grant, would you be able to include data on how many shareholders voted for and against each item, similar to what happens with the scheme of arrangement? This is a disclosure initiative embraced by the likes of Altium, Metcash and Dexus in recent weeks and provides an insight into retail shareholder sentiment at a time when voter participation at AGMs continues to fall as many feel overwhelmed by the big institutional investors and don't bother to vote at all.

Well, again, thank you for your request. We had some of them prior to the meeting. You make very good points as usual. And we'd be happy to discuss these with you further, which I think is probably better than in this forum. You've got 3 requests here. One, can we make voting results available earlier. And we have actually had a pre-discussion on that with you. About disclosing the number of shareholders voting in addition to shares, and transcript on the website, which we're already doing. Can I have the next question, please?

Mr. Chairman, there are no further questions for this item of business.

Well, thank you. The direct votes cast and the position of proxies received on item 3 prior to this meeting will now appear on the screen. As you can see, there's more than 95% votes in favor just on the proxies. They don't include those already submitted on the platform today. And any proxies revoked before the start of the meeting are not material. As the meeting Chairman, therefore, any proxies given to me will be voted in favor of this resolution, unless specifically directed otherwise. In accordance with the Corporations Act, other than the proxies granted to me as Chairman, all key MP personnel and their closely related parties are not eligible to vote any undirected proxies on this resolution and will abstain from voting any undirected proxies. Key management personnel and their closely related parties are, however, permitted to vote on this resolution and exercise a directed proxy on behalf of a person entitled to vote on this resolution. So in accordance with the Corporations Act and the ASX Listing Rules, Peter King and any associate of Peter are not eligible to vote on this resolution other than in their exercising directed proxy. And I'll now formally propose the following resolution, to approve the grant of performance share rights under the long-term variable reward plan for the 2022 financial year to your Chief Executive, Peter King, under the relevant LTVR plan rules and on terms summarized in the explanatory notice in the Notice of Meeting. Approval is being sought for all purposes, including ASX Listing Rule 10.14 and Sections 200B and 200E of the Corporation Act. If you've not completed your voting card for this resolution via the AGM platform, do it now, and that completes item 3. The fourth item of business is the reelection and election of Directors. If you'd like to ask a question, please submit it through the AGM platform now [Operator Instructions]. Under Westpac's constitution, 1/3 of the current Directors, excluding the Managing Director, and any Director filling a casual vacancy must retire by rotation at each AGM. And as indicated in the Notice of Meeting, Craig Dunn is retiring as a Director at the conclusion of this meeting. Nerida Caesar and Margie Seale are retiring by rotation at this meeting, and being eligible, are offering themselves for reelection in accordance with the constitution. Nora Scheinkestel was appointed on the 1st of March 2021, and Audette Exel was appointed on the 1st of September 2021 and are both seeking election at this meeting in accordance with the constitution. I'd like to advise that the Board, other than the Director concerned in each case, has considered the performance of each Director standing for election or reelection under this item. And following this review, the Board unanimously recommends that Nerida, Margie, Nora and Audette be submitted for reelection or election to the Board. Each of these Directors abstained from making a recommendation on their own election or reelection. The reelection of Nerida Caesar is the next item of business at today's meeting. Nerida was appointed a Director in September 2017. Now I know in Australia, it's common practice and that shareholders do like to hear from Directors who are coming up for election or reelection, and I'll therefore now ask Nerida to address the meeting.

Thank you, Chairman. It has been an honor to serve you as a Non-Executive Director of Westpac for the past 4 years. Today, I seek your support for reelection for a further 3-year term. As the country's oldest bank, we continue to play a critical role in the lives of Australian and New Zealand consumers, businesses and importantly, economies. We have supported customers through the pandemic while responding to our own challenges and carrying out a significant change program to become a stronger bank. I believe we have the right plan and team in place to turn Westpac around, and I am committed to continuing to serve on the Board and help to steer the company through the next phase of transformation and growth. My executive career of 31 years was spent in the technology sector, leading large corporate listed and unlisted businesses in Australia and Asia. I have been through many transformations of varying levels of complexity, and I feel I am well suited for this next phase. I have a deep understanding of customers, products, data and analytics and technology. These are critical skills in banking today as the sector digitizes and increasingly competes with technology companies. I believe my experience as a technology executive and as a CEO of an ASX-listed company in my last role, provide a valuable perspective that can help Westpac navigate this next period. I serve on 2 committees, the Legal, Regulatory and Compliance Committee and the Technology Committee. My skills and background are well suited to both. I also serve on a number of smaller Boards in the technology sector and chair a charity that provides consulting and platform services to corporates to support payroll-giving for staff. While the path ahead will continue to be challenging as we rebuild our brand, transform our systems and processes and develop a truly differentiated customer experience, I welcome the opportunity to contribute my skills and commitment for another 3-year term. Thank you for your time and consideration today. I am a committed and dedicated Director, and I would be honored to have your support today.

Thank you, Nerida. And can I have the first question, please?

Mr. Chairman, we have a question from Stephen Mayne. "The Chairman stated earlier in the meeting that some of our new Directors pitch themselves to the Directors, and others were approached by Westpac's headhunting. If comfortable, could the 4 Directors up for election today please clarify what their situation was, and how they found the recruitment process?"

Well, look, thank you very much, Stephen. I won't answer the question as to whether they pitch for the role or not because that would be inappropriate. But as I understand it, I think it's probably more important that I answer this question than the individuals. I think the situation that they found themselves is the -- was the Board was very thorough and very constructive and the induction processes were very comprehensive. And I trust that the Directors did find that we handled the issue properly. Can I have the next question, please?

Yes. One more question.

Mr. Chairman, we have a question from Mauro Lombardo. "What value have you provided to Westpac? Given you have been a member since 2017, what accountability do you take on the recent failures in technology at WBC?"

Well, again, I will answer that question in that many of our issues, as I said before, preceded Nerida's appointment on the Board. And I don't think Non-Executive Directors individually need to take individual accountability for any particular issue relating to technology at WBC. So can I have the next question, please?

Mr. Chairman, there are no further questions for this item of business.

Thank you. The direct votes cast and the position of proxy votes received on item 4A prior to this meeting will now appear on the screen. These votes do not include those already submitted on the platform today. Any proxies revoked before the start of the meeting today are not material. As the meeting Chairman, any proxies given to me will be voted in favor of this resolution, unless specifically directed otherwise in the proxy form. I'll now formally propose the following resolution, to reelect Nerida Caesar as a Director. If you haven't completed your voting form from this resolution, do it now. Only eligible voting cardholders can vote on this item. The next item of business is the reelection of Margie Seale. Margie was appointed a Director in March 2019. And I'll now ask Margie to address the meeting.

Thank you, Chairman. I joined the Westpac Board almost 3 years ago, and those years have been a time of considerable challenge, change and development for the organization. We've had to face issues of the past, the need to dramatically transform and to become a simpler, stronger bank. Despite these difficulties, I've been heartened by the qualities that run deep in the organization. Westpac's values are strong. Its people want to and do help thousands of customers daily, and its franchise is robust. We've learned a lot in the past few years and are making progress on strengthening risk management and culture and refocusing on our core business. But there is much more to do to hasten the delivery of our strategy, build better relationships with customers and improve performance and returns to you, our shareholders. The Board's role since I joined has not been an easy one, but I believe we are doing what we must to guide and govern Westpac. In this climate of constant change and ever new demands from customers about how, when and what services they require, the market and you, our shareholders, demand that we both stay on our transformation track as well as invest in the financial services world of the future. Should I be reelected today, I will continue to make sure we prosecute both those paths. As Chair of the Board Legal, Regulatory and Compliance Committee, along with my colleagues, I've overseen Westpac's response to the AUSTRAC matter and the improvement of our financial crime processes. Management has worked hard to address and complete all the issues in AUSTRAC Statement of Claim. You will have heard about the CORE program already this morning. And through that program, risk management and risk culture are becoming stronger, and accountability is clearer. But as the CORE program is only 1/3 of the way through, we have a long way to go and need to stay the course. This requires discipline, sticktuitiveness and an eye both on improvements internally as well as better performance and development externally. I'm pleased we are delivering our digital programs with vigor and achieving results, but know that nothing stands still, and there is yet much to achieve. Westpac has always been part of my life. My grandfather was a Bank of New South Wales bank manager in the country town of Casino. And like him, I'm very proud to serve this company. My experience as an Executive and Non-Executive Director over many years, spanning a range of geographies, complex operating environments and technological and digital challenges, I hope, equips me with the necessary skills and insights to contribute to Westpac's future success. I ask for your support for my reelection today. Thank you.

Well, thank you, Margie. Can I have the first question, please?

Mr. Chairman, we have a question from Stephen Mayne. "The Board appears to be set on a plan today of not disclosing the proxy position on item 6B, the climate resolution, until after the debate has closed. Woodside did something similar earlier this year so shareholders were unable to discuss the record rejection of the Board's climate voting advice at its AGM. Could Margie Seale comment on why she supports withholding the voting data rather than putting it out there early so investors can ask questions if there has been a big climate protest vote?"

Well, Stephen, I'll answer the question. I mean, one of the things I admired about you is that you're an innovator. And also, the other thing is that you do tell us in advance of the things that you're interested in changing, which we genuinely appreciate it. But I think we've taken the view that it's not appropriate to have proxy votes influence shareholders, given that all shareholders should have equal information to vote on an AGM, and that is the view we take. So can I have the next question, please?

Mr. Chairman, we have a question from Stephen Mayne. "There was a 21% protest vote against Nerida Caesar, suggesting that shareholders are lashing out against longer-serving Directors. Has Margaret suffered a similar protest? And which of the proxy advisers was responsible for recommending this outcome?"

The -- look, I think you're making -- you are making a point that because the company has some long-term issues that, in general, there is a correlation between the longer you've been on the Board, then shareholders are actually imputing some accountability or greater accountability the longer you've been on the Board, which may or may not be justified in fact. So I do think you are making a point here, which seems to be playing out. Now I really shouldn't answer this question, but Margie did not suffer a similar protest and -- as you'll see later. Can I have the next question, please?

Mr. Chairman, we have a question from David Payne. "Please allow more freedom for the Director candidates to directly answer questions put to them rather than have the questions deflected by the meeting Chairman. I would like to be able to better assess the quality of the potential Directors by hearing from them more directly. Thank you."

Well, thank you, David, for your suggestion. I think we've gone quite a long way in Australia to have the Directors speak to you in the first place, which does not happen in most other countries. And so I think that's a big win for you. I think having them being questioned by you, I don't think, is part of the process. So I doubt that we're going to go in that direction unless it's legally required. But thanks for the suggestion. Can I have the next question, please?

Mr. Chairman, there are no further questions for this item of business.

Well, thank you. The direct votes cast and the position of the proxy votes received on item 4B prior to the meeting will now appear on the screen. And as you can see, Stephen, I've answered that question. The votes do not include those already submitted on the platform today. Any proxies revoked before the start of the meeting today are not material. And as the meeting Chairman, any proxies given to me will be voted in favor of this resolution, unless specifically directed otherwise in the proxy form. So I'll now propose formally the following resolution, to reelect Margaret Seale as a Director. If you have not completed your voting card for this resolution, please do so now. Only eligible voting card holders can vote on this item. Item 4C considers the election of Nora Scheinkestel, who is seeking election as a Director. I'll now ask Nora to address the meeting.

Thank you, Chairman. Good afternoon, everyone. My name is Nora Scheinkestel. I joined the Board in March this year and have served on the Risk and Remuneration Committees. Should you choose to support my election today, I will assume the Chair of the Remuneration Committee after this meeting. When I was interviewed at the time I joined about why I had wanted to join the Board, I said Westpac as a major Australian bank plays a pivotal role in our society. It's a lubricant of the economy, and an enabler of people's dreams. What a privilege to be asked to play a part in helping Westpac complete the transformation it is undergoing. And then fulfill its purpose of helping Australians and New Zealanders succeed. I have joined Westpac at a critical moment, both for the bank and our broader economy and society. As we emerge from the pandemic, Westpac has not only the opportunity but the responsibility to play a key role in supporting customers, both retail and business. We will be doing this against a backdrop of significant societal challenges, including climate change and inequality, where the bank has already shown an awareness and willingness to engage and contribute to solutions. I believe I can help the bank in forging this path forward. I have been a Non-Executive Director and Chairman of both listed and unlisted companies for some 27 years, working across pretty much every sector of the economy. I have served on and often chaired Board committees across the entire range of a Board's responsibility. I've been through economic cycles. I've been involved in companies at all stages of development, and through myriad of corporate transactions. I've worked with companies facing profound disruption in their markets and with organizations in heavily regulated industries. Many of the companies I've been involved with have undertaken major transformation programs, including both technological and cultural change, and all needing to deeply understand the needs and wants of our customers who are also experiencing fundamental change in how they want to live, work and play. My background and experience across all these areas will be of direct benefit to Westpac and the work that lies ahead of us. Westpac is well progressed on its transformation, but there is still much to do. Peter and the management team are committed to deliver on the strategy of Fix, Simplify and Perform. And in so doing, delivering a superb customer experience and appropriate returns to our shareholders. I believe the depth and breadth of my experience will allow me to assist the management team and work with my Board colleagues to deliver on these objectives. Thank you.

Well, thank you, Nora. And can I have the first question, please?

Mr. Chairman, we have a question from Stephen Mayne. "As the incoming Rem Committee Chair, what does Nora think about today's 29.7% protest vote against the rem report? Does she have a history of dealing with proxy advisers and institutional investors to respond to protest votes such as today's? How does she intend to go about it?"

Well, given it's conceptual, Stephen, and it's in the future, I think it's not appropriate to see what she will do. But I can imagine she thinks it's fair. But what I will do is to ask our current Remuneration Committee Chair of an observation as to how he feels about this.

Yes. Thank you, Chairman. Thank you for the question. Obviously, it's a disappointing result, and it's something that we'll reflect on deeply, as the Chair said, in his opening remarks. As a standard process on the remuneration report, which I'm sure Nora will adopt going forward, is we do review all the feedback we get in the lead up to an AGM from proxy advisers and also other shareholders, including questions asked at the AGM. And that feedback will form a good basis of information for us to take forward when we consider a range of factors going forward, including the disclosures we include in our remuneration report. And one thing the Remuneration Committee will need to address going forward is the new prudential standard on remuneration by APRA, and that's something that Nora will pick up as the incoming chair of the Remuneration Committee.

Just I would add something, Stephen. That the remuneration of executives at Westpac in the last 12 months wasn't aggressive, as you and I both know, that the long-term variable reward system has not paid out for 6 years, that because of AUSTRAC rather than that being zeroed for the year in which that arose. In fact, it was at my instigation, I zeroed the STVR for the group executives last year, and so Peter didn't receive any STVR last year. So -- and this year's was discounted because of the reduction in core earnings, which we felt was done at the right level. I think the protest vote is perfectly respectable, and it relates to the fall in the share price, which related principally to analysts marking down their forecast following the margin, and also the cost issue. Although I've explained the cost issue, I don't think was the same reason for them adjusting their reports. Can I have the first question -- the next question, please.

Mr. Chairman, there are no further questions from the online platform. The first telephone question is from Peter Star.

Nora, I've known you for a long while, while you're on the Telstra Board. So we'll be definitely voting for you. And I wish you all the best, and you've certainly got a job ahead of you given the protest vote today, and it's probably rightly deserved, and you know the issues. Get in there and get the things fixed. Thank you.

Well, thank you for your advice. Can I have the next question, please?

Mr. Chairman, there are no further questions for this item of business.

Well, thank you. The direct votes cast and the position of proxy votes received on Resolution 4C prior to the meeting will now appear on the screen. Those votes do not include those already submitted on the platform today. Any proxies revoked before the start of the meeting today aren't material. So as the meeting Chairman, any proxies given to me will be voted in favor of this resolution, unless specifically directed otherwise in the proxy form. And I'll now formally propose the following resolution, to elect Nora Scheinkestel as a Director. If you haven't completed your voting card for this resolution, do so now. Only eligible voting card holders can vote on this item. Item 4D considers the election of Audette Exel, who is seeking election as a Director. So I'll now ask Audette to address the meeting.

Thank you, Chairman. It's an honor to be before you, our shareholders, today seeking election to the Board of this great company, Westpac. I joined the Board in September this year, and I would be very proud to be elected to serve on your Board for the next 3 years. I've had a very lucky life in Korea, spanning the world of law, banking, insurance, independent directorships and social entrepreneurship. Some highlights for me include acting as an adviser to major companies in my role as a lawyer with Allen's and also with Linklaters. And as I currently do as a corporate adviser in my own business, Adara Partners. I went from advising on balance sheets to running one and spent 3 years as the Managing Director of a publicly traded bank in Bermuda. That role taught me a great deal about managing teams, businesses, NIMs, balance sheets and how complex that can be. During that time, I was also a Chair of the Bermuda Stock Exchange. Then I was a poacher turned gamekeeper and sat on the Board of the Bermuda Regulator, the BMA, regulating both insurance and reinsurance companies as well as banks. I've also been a Non-Executive Director with some great companies around the world including most recently 8 years on the Board of Suncorp. I am most proud of my role as a social entrepreneur having founded and built the Adara Group over the last, amazingly, nearly 24 years. Adara has 2 different parts: our corporate advice businesses for purpose; and our international development organization. Even though we have 2 different parts, we only have 1 single purpose, and that is providing health and education services to hundreds of thousands of people in extreme poverty year after year in some of the world's most remote places. I profoundly believe that the provision of financial services to a level of excellence is a social good and critical to the well-being of so many, including shareholders, customers, staff and communities more broadly, and of course, also of great importance to the environment. Westpac has an incredibly important role in Australian life. As we face the mistakes of the past and we dig deep to further implement Fix, Simplify and Perform, I believe Westpac will stand as a bank that everyone who is associated with it at every level will be proud of. If I'm elected today, I will do my best on the Board to steer Westpac to the next stage of its journey and to ensure that it rewards and supports all its stakeholders at this critical time in our history. Thank you.

Well, thank you, Audette. And can I have the first question, please?

Mr. Chairman, we have a question from Michael Friend. "Surely, with a huge vote against the election of Nerida Caesar by shareholders, she will reconsider her position on the Board. Will you, as Chairman, commit to Audette Exel doing the same if the vote against is of a similar nature?"

I'm not going to answer what happens in the future and speculate. And actually, I don't want Nerida to reconsider her position on the Board. And in fact, while it hasn't been concluded, you've seen the proxy votes, they're primarily in favor of Nerida's election. And I think that answers the question. Can I have the next question, please?

Mr. Chairman, there are no further questions for this item of business.

Well, thank you. The direct votes cast and the position of proxy votes received on item 4D prior to this meeting will now appear on the screen. These votes do not include those already submitted on the platform today, and any proxies revoked before the start of the meeting today aren't material. So as the meeting Chairman, any proxies given to me will be voted in favor of this resolution, unless specifically directed otherwise in the proxy form. I'll now formally propose the following resolution, to elect Audette Exel as a Director. If you haven't completed your voting card for this resolution, please do so now. Only eligible voting card holders can vote on this item. Now that completes item 4. And I'd just say that of the 4 Directors that we've been voting here, we are very lucky to have them on the Board, and they do a great job. So turning to item 5, which requires a special resolution to amend the constitution. Following a review by the Board, a number of targeted amendments are recommended to accommodate regulatory developments, changing market practice and to more closely align the constitution to the ASX Listing Rules. The constitution was last amended in 2012. The proposed amendments to the constitution are available on Westpac's AGM website and the Related Documents tab under the webcast, and are summarized in the Notice of Meeting. So I now ask if there are any questions on Resolution 5 relating to the proposed amendments to the Westpac constitution can be heard now. So can I have the first question, please?

Mr. Chairman, there are no questions for this item of business.

Well, thank you. The direct votes cast and the position of proxies received on item 5 prior to the meeting will now be on the screen. They don't include those already submitted on the platform today. And any proxies revoked before the start of the meeting today aren't material. As the meeting Chairman, any proxies given to me will be voted in favor of this resolution, unless specifically directed otherwise. So in accordance with the Corporations Act as a special resolution, it will only be passed if at least 75% of the votes cast on this item are in favor of the resolution. And I'll now formally propose the following resolution as a special resolution, that the Westpac constitution be amended to adopt those changes as set out in the documents made available at westpac.com.au/AGM and as described in the explanatory notes to this meeting in the Notice of Meeting. With effect to the close of the AGM, if you've not completed your voting card for this resolution via the AGM platform, please do it now. And that completes item 5. Now the next item of business is item 6A. Now as you have noticed that throughout item 1, we have answered quite a lot of questions relating to this. This resolution also relates to proposed amendments to the Westpac constitution and has been requisitioned by a group of shareholders. This resolution is required to be passed as a special resolution. And item 6B, which is also requisitioned by the same group of shareholders, is conditional on 6A passing. Under the Corporations Act, shareholders can propose to move a resolution at a general meeting. In this instance, Market Forces, put forward this resolution with more than 100 signatories. The explanatory notes in the Notice of Meeting contains an explanation from Market Forces on why this resolution is being put forward along with the Board's view. The resolution is not recommended by the Board. Nevertheless, we do respect the right of shareholders to make such resolutions, and we will now play a video from Market Forces on these resolutions.

I'm Jack Bertolus from Market Forces. We work with shareholders to coordinate items 6A and B, and I'll speak briefly today in favor of the resolution calling on Westpac to commit to no longer finance new fossil fuel projects and to disclose targets to reduce exposure to fossil fuels, consistent with net-zero greenhouse gas emissions by 2050. Westpac supports the net-zero by 2050 goal. Climate science and energy modeling make it abundantly clear that achieving this goal leaves no room for new fossil fuel projects and requires rapid declines in the production and use of coal, oil and gas. Yet Westpac continues to fund new fossil fuel projects and the company is pursuing them and continues to delay action to address this. For example, Westpac intends to wait another 2 years before establishing financing strategies and portfolio targets for sectors including oil and gas. This resolution, therefore, presents a necessary opportunity to bring Westpac's fossil fuel lending into line with its stated support for global climate goals. Failure to bridge this gap would lead Westpac exposed to needless financial climate change transition risks as well as reputation and legal risks as the world moves to rapidly decarbonize. Shareholders do not want to see this company exposed to stranded fossil fuel assets, being publicly called out for funding climate-wrecking companies or being sued over inconsistencies between its statements and actions. We therefore ask shareholders to support this resolution with the long-term interests and sustainability of the company in mind and thank those that have already cast votes in favor of the resolution. Thank you.

Well, thank you. I now ask if there are any questions in relation to resolution 6A. And can I have the first question, please?

Mr. Chairman, we have a question from Stephen Mayne. "The Chair earlier requested that all climate-related questions be deferred until we dealt with Item 6b today. Does he agree this was somewhat disingenuous, seeing as there won't be any debate on item 6B because he knows that the proxies for item 6A show that has been overwhelmingly rejected, meaning that there won't be any debate on item 6B, which was contingent on item 6A passing?"

Stephen, I think you and I both know that there will be discussion on this item. And I don't think it's disingenuous. So can I have the next question, please?

Mr. Chairman, there are no further questions for this item of business.

Well, thank you. We certainly dealt with it, the issue of climate change, and I will summarize our position again. We're trying to do the right thing here, that we are very sympathetic. And in fact, it won't take us 2 years. We're doing the work now, and hopefully, that we will align ourselves to the Banking Alliance, which supports net-zero by 2050. And so I believe we're doing the right thing. We cannot sign that document until we've done the work because we only have 18 months to be able to implement it. So aside from our position on financing fossil fuels, our disclosures are ahead of the industry and our exposures are below the industry and are reducing faster than the industry. And the work we are doing is sector-leading. So I do believe we're doing the right thing here and finding the right balance. And the direct votes cast and the position of proxy votes received on item 6A prior to the meeting will now appear on the screen. These votes don't include those already submitted on the platform today. And any proxies revoked before the start of the meeting today are not material. As the Chairman of the meeting, any proxies given to me will be voted against this resolution, unless specifically directed otherwise. And I'll now formally propose the following resolution 6A as a special resolution, to consider, and if thought fit, pass the following resolution as a special resolution. Insert into the constitution in Clause 7, general meetings, the following new Subclause 7.3A advisory resolutions. The company in general meeting may by ordinary resolution express an opinion or request information about the way in which a power of the company, partially or exclusively vested in the Directors, has been or should be exercised. Such a resolution must relate to a material risk identified by the Directors of the company and cannot advocate action that would violate any law or relate to any personal claim or grievance. Such a resolution is advisory only and doesn't bind the Directors of the company. If you haven't completed your voting card for this resolution, please do it now. Only eligible voting card holders can vote on this item. As the proxy voting and the proposed amendment to the Westpac's constitution has shown an against vote of significantly more than 25%, and this will not be material of impact by votes received by the platform today, this means that shareholders have voted against the proposed amendments to the constitution. And as resolution 6A did not pass, resolution 6B will not be put to the meeting. However, we do know this is an important matter for many shareholders, and we will allow discussion on resolution 6B. This resolution relates to Westpac's disclosure of strategies and targets for which -- for how Westpac will manage its fossil fuel exposures. Now while this vote is not required, the direct votes cast and the position of the proxy votes received on item 6B prior to the meeting will now appear on the screen. Any proxies revoked before the start of the meeting today aren't material. So I'll now ask if there are any questions in relationship to Resolution 6B. And can I have the first question, please?

Mr. Chairman, we have a telephone question from Tracy Hamilton.

Look, I'm a long-term Westpac customer, and I've still got some issues concerning around your climate change strategy. And look, I've read your annual report, and it talks a lot about sustainability and our lending to renewable energy. Page 29 shows that exposure to fossil fuels is $7.4 billion, which is more than double of exposure to renewable energy. Do you really expect we take you seriously on climate change when your loan book is so heavily weighted towards fossil fuels?

Well, thank you for the question. When you consider the size of our exposures to fossil fuels in the context of the corporation, it is well under 1%. So our book is not skewed to fossil fuels. But I'll pass the question to Peter since it's come up before.

Well, I think we would just go back to the points that we've made previously in the meeting. As John said, the lending to fossil fuel mining is down 14%. We've got the lowest exposure to coal mining, oil and gas extraction of the majors. We're exiting thermal coal by 2030, and new lending to metallurgical coal, oil and gas mining customers must be Paris-aligned. So I think we are doing a lot. And as the Chairman said, the exposure in the context of the bank is small, but obviously important.

And fossil fuels are going down. And exposures -- and renewables are going up. And exposures, the line will cross. And therefore, the second part of your question will become academic. Can I have the next question, please?

Mr. Chairman, there are no further questions for this item of business.

Well, that completes all items of business. Before I formally close the meeting, I wanted to check if there were any further questions or comments submitted via the AGM platform or on the telephone during the meeting that we've not yet had the opportunity to consider.

Mr. Chairman, we have a question from Rita Mazalevskis in relation to item 2. "In September, KPMG were fined $613,000 by the U.S. accounting watchdog after a review found widespread cheating by staff on trading tests over a 4-year period. The U.S. Public Company Accounting Oversight Board found that approximately 12% or more than 1,000 Australian staff had cheated on important professional compliance tests that ensure staff members are aware of various laws and accounting standards. Is the Board and Westpac aware if their auditor company, PwC, has any of these serious issues?"

Well, the one thing I would say, Rita, about this is that if there are material issues affecting the performance of the audit or their role as auditor, they are required to disclose it to us. And we have received no such disclosures. And therefore, we're not aware of any of these material matters. Are there any other questions?

Mr. Chairman, we have a question from Daisy Gardner regarding item 1. "Given the International Energy Agency has concluded that we cannot develop any new or expanded fossil fuel projects if we are to limit global warming to 1.5 degrees, will Westpac rule out financing any company planning to develop gas reserves in the Bitaloo Basin?"

Well, again, thank you very much for the question, Daisy, which I think I've answered in about 6 different ways now. That I realize you feel really strong about this, and I realize that you can comment on individual exposures that I can't comment on. Just repeat, the general proposition is that our exposure to fossil fuels has declined and is going to continue to decline, and our exposure to renewables is high and is increasing. And that this issue over time will be resolved. Are there any other questions?

Mr. Chairman, we have a question from Stephen Mayne regarding item 3. "There was a 29.7% protest vote against the rem grant. Were shareholders also concerned about this remuneration item? And please comment further on why shareholders revolted against the rem report?"

Look, Stephen, you and I have been doing this long enough that we know that what we were putting forward with respect to executive remuneration was not aggressive and, in fact, was well below our competitors as it should have been, given the nature of the performance. We thought we struck the right balance here. But of course, there were new information came afterwards with respect to shareholders and analyst reaction to the performance or aspects of the performance, which we weren't aware of at the time. And therefore, that has probably created what you've said is a protest vote. And this is a way of shareholders expressing concern over matters. And one of the ways they can do that is on the voting for the remuneration. And I thought shareholders have voted, they've actually voted more than 25%. We've got a first strike against it. Now I mean, I know -- I mean I'm concerned about underlying performance. And I know shareholders are concerned about it. And I've discussed that with shareholders. And I've actually discussed it at some length here today. Anyway, we've ended up where we've ended up, and we just got to do better going forward. Are there any other questions, please?

Mr. Chairman, we have a question from Wendy Wallace regarding item 6B. "Just a heartfelt comment. What a trial this meeting has been, over 3 hours with far too much time taken up by climate activists and others, all pushing their own agendas. What an arrogant, inconsiderate waste of everyone's lives. It does nothing to engender sympathy for their causes. In fact, it engenders aversion, both to them and to their causes."

Wendy, thank you very much for your sincere comment here, which I won't amplify or comment on, but it is appreciated that you've taken the trouble. Are there any other questions?

Mr. Chairman, we have a question from Stuart Palmer regarding item 6B. "I'm Stuart Palmer from Australian Ethical Investment. The Chair has referred to the requirement for new oil and gas clients to have Paris-aligned targets. Why are existing and new customers treated differently? For example, why doesn't the same test apply to new bank funding or refinancing for an existing client, which is expanding its oil and gas exploration and extraction? What steps is the bank taking to be satisfied that client targets are real and not window dressing and that clients are actually testing new capital expenditure against their targets?"

Look, that's a very, very good point, and you're absolutely correct here that there is an issue about existing and new exposures. I would say this, though, that most of this is new to many companies in this country and elsewhere. And although the bank is quite far advanced in this area, not all our clients are as far advanced as we are in this area and haven't really gotten to the same stage of addressing these matters as the bank has. I know you want us to address it even further. But gradually, what will happen is that we're asking our existing and our new customers to address it equally and to disclose it adequately equally as such that we are then fully informed. And therefore, we can satisfy ourselves as to whether this is a legitimate transitioning request or an illegitimate transitioning request, and we'll be more informed as time goes on. But given that this is relatively new and that the government has only committed to this 2050 target, I think it's unreasonable to expect that everybody is in the right position -- in the same position now. So I think this is going to take some time. And therefore, I would ask for some patience really by you on this. Now are there any other questions on this or other topics?

Mr. Chairman, we have a question from David Payne regarding item 6B. "Will Westpac continue to provide sustaining funding for existing fossil fuel operations or projects while reducing, then potentially eliminating funding to new projects?"

I won't differentiate between existing and new projects. One of the problems that a bank gets technically, and I don't want to bore you here, is that if a term loan, which has got a fixed amount of time, finishes, and we renew that, that is a new loan. It's not an existing loan, okay? So basically, it's in the same category as the new financing. And therefore, ultimately, all things end up in the same place as either not a new request or a request to have a new facility, which becomes a new project. So I don't differentiate between these because technically, you can't. What I will say and what I have said is we will finance respectable programs over time, which are Paris-aligned and adequately disclosed. And we think that's a responsible thing to do, helping customers transition to the 2030 and 2050 targets. Are there any other questions?

Mr. Chairman, we have a question from David Payne regarding item 1. "Is Westpac likely to continue with the current dividend payout policy?"

Well, we don't ever commit to dividend policy because we can't predict the future. But we would like to is the truth of the matter. And in fact, I'm a big believer in a low-growth environment of a significant dividend yield, particularly fully franked dividend because you get your returns in 2 ways here. You get increases and/or reductions in the stock price and/or through the dividend. And so I do think dividend play a different part in different parts of the cycle. In this part of the cycle, bank earnings growth isn't extraordinarily high. And therefore, I think my judgment is that dividends are paying an unusually high role. And therefore, I'm quite comfortable with a good dividend yield. I mean, I prefer that dividend yield was -- because of increases in dividends and not reductions in the stock price. But -- and so I do think that we're doing the right thing here. We've got an account policy of dividend payout ratio range. We like to operate high in the range if we're able to. And so all other things being equal, I hope we will, but I can't promise it. Any other questions?

Mr. Chairman, we have a question from Michael Friend regarding item 4A. "Thank you to the Chairman for your candid answers today, very good compared to other companies. I am a shareholder and voted against Nerida Caesar today. This was not a protest vote, but a well thought out vote.

Well, thank you very much. You're perfectly entitled to that vote, and thank you for making the point. Are there any other questions, please?

Mr. Chairman, we have a telephone question from Tracy Hamilton regarding item 6B.

Just trying to understand, you've got a target of $15 billion in new lending for climate change solutions between 2020 and 2030. I understand these solutions include funding for a variety of activities, including alternative waste treatment, rehabilitate the waterways and transportation, including aviation biofuels. How much will this be directed to funding renewable energy?

I've made the general point about we're looking for more exposure and more relative exposure to renewables. But, Peter?

Tracy, I think there's not a specific part of that $15 billion that is targeted to that area. But what I would say in the $15 billion is it's probably too low. I think we'll end up funding more than $15 billion because of the speed at which climate change is happening and solutions are being developed. The $15 billion was set in the past, and I just think the economy is moving fast. And therefore, we'll end up with more, and we'll be looking to take the opportunity to support the development in that sector.

Any other questions, please?

Mr. Chairman, we have a question from Glenn Mann in relation to item 6B.

My question is basically a comment that back in Nature 42 of September 16, 2003, an article entitled High CO2 Levels in the proterozoic atmosphere estimated from analysis of individual microfossils referred to carbon dioxide levels of between 10 and 200x present atmospheric levels found in eukaryotic algal microfossils dated at 1.5 giga-annum. Now unfortunately, we have been overwhelmed with many, many different reports and figures given for current greenhouse gas emissions. And my point is that there seems to be still so much evidence that the current carbon dioxide levels are not a danger. But who actually has the final say because whenever we get reports from the climate alarmists, they throw up in our face that the banking industry worldwide has reduced funding for whatever the new coal-fired power station, gas-fired power stations as if that is a crime to be supporting those industries. And then we now have the other side of it where there is climate alarmists demanding the changes by the financial industries. So for me, I think Westpac has done the right thing by taking a measured approach rather than immediately jumping to these total bans that some of them are now demanding.

Well, look, thank you for your considered approach here. That one of the issues, of course, as you point out, is facts relate to today and what we know and what we used to know. But they don't -- you haven't got any facts with respect to the future. You've only got estimates and opinions. And these, as you've said, are wide ranging. And therefore, this, I think, is going to be an evolving situation. And that was just sort of a personal thought, though. I mean, I think we've got to have some thought to what if we're wrong here either way? And the one where you don't want to be wrong is that climate change is real and we haven't done anything about it on balance. I mean, I don't know what you'd do with that, but that would just be maybe just a thought to consider. But I think your point is well made, and thank you for making it. Do we have any other questions?

Mr. Chairman, we have a question from Stuart Palmer regarding item 6B, "A comment. A gradual approach to climate change misses the urgency of action needed and dismisses the extreme weather and fire impacts many Australians are suffering today. We are 6 years on from the Paris agreement."

Well, again, Stuart, thank you for, again, your opinion. And it is your opinion. It's not necessarily a fact. It's not necessarily agreed by everyone, and it isn't apparently agreed by the governments of Australia. So I do think we are where we are. We're trying to take a middle course of action. The middle course of action is to do the right thing with renewables and to reduce our exposure. We are actually accelerating a reduction. So I think Westpac is in a good place here, if not perfect in your mind. Any other questions?

Mr. Chairman, there are no further questions.

Well, thank you. As there are no further questions, that completes the business of the meeting. The polls will close in 15 minutes on all resolutions, at which time I will declare that the meeting will be formally closed. So if you haven't completed your voting form via the AGM platform, please do it now, bearing in mind the voting rules set out in the Notice of Meeting. A countdown timer will appear on the AGM platform. Once that timer expires, any votes that you've entered on your online voted card but not yet submitted will be automatically submitted for you. So thank you for joining, and I look forward, hopefully, to seeing you in person next year. And I want to take this opportunity of wishing you all a very safe and happy holiday period. Thank you.