Heritage Bank Accreditation Presentation

Agenda 1. Who is Heritage Bank? 2. We are here to help 3. Residential mortgages 4. Product range 5. Policy guidelines 6. Tips and hints 7.The Heritage difference 8. The Broker Website 9. Service levels 10. Application process 11. Questions

Who is Heritage Bank?  Australia’s largest customer-owned bank  A mutual organisation with a “People first” philosophy Head office based in Toowoomba, Queensland Contact Centre located in Australia Over 140 years in business Approximately $8 billion in assets Broker support staff based in Brisbane, Sydney, Melbourne, Adelaide and Perth Loans sold into every State and Territory in Australia

We are here to help Offer a full range of financial services Residential loans Personal banking (visa, transaction accounts, personal loans) Investments (term deposits, savings) Insurance (motor vehicle, landlords, residential, mortgage repayment insurance) Financial planning Business Banking Foreign exchange Distribution via: Branch network Broker partners Alliances Service customers via: Contact Centre Internet Telephone & Mobile banking (over-the-counter transactions) at Australia Post outlets ATM network and EFTPOS

Residential Mortgages Purchases Refinance Investment Construction Land purchase Debt consolidation Further advances Bridging finance Line of credit

Let’s look at…  Bridging Loan  Discount Variable Home Loan  Fixed Rate Home Loan  Home Advantage Package  Standard Variable Home Loan

Target Market This loan is for customers who have found a new house to purchase or are in the process of constructing a new House but haven’t sold their existing property yet. The Bridging Loan offers the simple solution of being able to move into their new home while their old home is still on the market. Benefits Competitive Interest rate No repayments necessary until end of loan term No monthly administration fee No early termination fee No servicing assessment required on Bridging loan Interest can be capitalised Additional or lump sum repayments welcome without penalty Valuation fee on first security paid by Heritage up to maximum $330^ Normal LVR requirements apply to new home Bridging loan can be combined with any other Heritage loan type Requirements Application fee of $900 Must be repaid within 12 months Maximum 72% LVR (on property to be sold) Standard term of 6 months Bridging Loan

Example of how a Bridging Loan could work Current home value$350,000 72% Valuation (Bridging Loan)$252,000 Balance of current home loan-$192,000 Equity for purchase$60,000 New home purchase cost$400,000 Costs to purchase new home$20,000 Less Equity from Bridging Loan-$60,000 New home loan required$360,000

Discount Variable home loan Target Market: If your clients are looking for a home loan with a low rate and basic features, the Discount Variable home loan is hard to beat. With an ongoing discounted interest rate and no monthly administration fee, this loan is perfect for people who love a good deal. Benefits: Low rate home loan No monthly administration fee Further advances available Redraw facility available Option to make additional or lump sum repayments without penalty First valuation fee paid by Heritage up to maximum $330^ No offset account available Switching available 30 years maximum loan term Interest only term for Investment loans up to 5 years available Requirements $600 application fee Max 95% LVR – investment loan max 90% LVR Minimum $150,000 loan amount

Home Advantage Package Target Market Our all-in-one Home Advantage Package is ideal if your client wants to have all their main banking needs in one package with one annual fee. Benefits Choose from our variable rate, fixed rate or living equity home loans Competitive Interest rates No application fee – low annual package fee of $350 No monthly administration fee Additional repayments welcome without penalties Free redraw facility No application fee on further advances Loan splits available Valuation fee on first security paid by Heritage up to maximum $330^ Construction loan available Requirements Max 95% LVR on Variable & Fixed rate products, 85% LVR on Living Equity – investment loans max 90% LVR with Variable, Fixed rate & Living Equity products. Must borrow at least $150,000 within the package and hold at least one of the three Home Advantage loan products Must hold any qualifying Visa card Must pay the annual package fee

Home Advantage Package continued Visa Credit card  No annual Fee  12 month introductory interest rate Transactional account  $0 monthly account keeping fee  Unlimited free EFTPOS and Network ATM transactions  Free internet, mobile and phone banking  Visa debit card available  Transact through Insurances  Up to 5% off base premium for most insurances Other Benefits  100% offset account available on variable loans  Partial offset account available on fixed rate loans

Target Market: Fixed Rate loans are attractive to cautious borrowers and/or first homebuyers who maybe concerned about the affordability of their loan should interest rates rise. Benefits: $5 monthly administration fee (waived for loans in a package) Unrestricted redraw facility Extra repayments welcome with no penalty Partial offset account available Guaranteed interest rate and set repayment for up to 5 years at a time Interest only term for Investment loans up to 5 years available Rate guarantee available at 0.12% of basic loan amount Available for Construction Loans Refix at end of fixed term at no cost Reverts to Standard Variable when fixed term expires Valuation fee on first security paid by Heritage up to $330^ Requirements $600 application fee Max 95% LVR – investment loans max 90% LVR Minimum $20,000 loan amount Fixed Rate Home Loans

Other product parameters to note ProductMax LVR Owner Occupied Max LVR Investment Standard Variable, Fixed, Discount Variable, Home Advantage Package 95% (including LMI) 90% (including LMI) Refinance90% (including LMI) Living Equity85% (including LMI) Debt Consolidation85% (plus LMI) Bridging Finance72% Line of Credit  $8 Administration fee  Interest only repayments for the first 10 years  Up to 5 sub-accounts available  Additional repayments can be made without penalty  Minimum credit limit of $20,000  Maximum credit limit of $500,000  Available funds may be drawn at any time up to the approved credit limit  Funds may be accessed using a Heritage Visa Debit card

Policy guidelines to note  Maximum Net Surplus Ratio allowable 95%  Overtime and commission income is an acceptable form of income. Conditions apply.  Third party guarantor loans will only be acceptable for husband and wife structures  Loan qualifying rate is 7.15% Loan TypeCommitment Calculation New Mortgage Loans (fixed / variable)*Higher of the Qualifying Rate or actual rate + 2% Existing Variable rateHigher of the Qualifying Rate or actual rate + 2% Existing Fixed rate (within 24 months of expiring)Higher of the Qualifying Rate or actual rate + 2% Existing Fixed rate (with more than 24 months remaining) Higher of the Qualifying Rate or actual rate + 2% Interest Only Loans Based on the principal amount owing, amortised over the remaining principal & interest period applicable to the loan. The maximum principal & interest period (or where the remaining principal & interest term is unascertainable) is to be 25 years. Line of Credits Based on the facility Limit, amortised over the remaining principal & interest period applicable to the loan. The maximum principal & interest period (or where there isn't a principal & interest period or the remaining principal & interest term is unascertainable) is to be 20 years. * New mortgage loans / new lending are defined as loans which have not been funded, irrespective of the financier or purpose of the loan.

Tips & Hints  Ensure brief summary of loan is given  For refinance applications, provide the outgoing Financial Institutions most current refinance form signed by the borrower  For all fixed rate loan applications ensure the Rate Guarantee Acknowledgement form is completed and signed  Ensure clients provide explanations with defaults  Supporting information corresponds to checklist on application  Pre-Approvals/Approvals in principal will not be assessed – Contracts must be provided  Supporting information is legible  No company applications accepted  Purpose is clearly stated  Internet statements must have client details on them to be accepted

The Heritage Difference Credit card limits - ignored in special circumstances Company vehicle - $150 net per week allowed < 80% LVR Petrol card - $50 net per week allowed < 80% LVR 2 nd Mortgage finance available Rural Residential (zoning) – max 85% LVR Owner Occupier & 80% LVR Investment Bridging finance is serviced on end debt Value for money lending BDM’s are experienced lenders not just salespeople Direct access to loan assessors and processors No credit scoring of home loan applications <80% LVR

The Broker website The site offers a range of information on Heritage’s products, policies and loan tracking system.  Forms  Rates  Product information  Policies and procedures  Calculators  Contacts  Accreditation Presentation  Loan Tracking System

Service Levels Receipt of applicationSame day Conditional Approval48 hours Formal Approval – following receipt of acceptable valuation and all conditions satisfied 48 hours Offer documentation48 hours Settlement4 working days

Loan application process Application submitted electronically to Heritage Bank. Application reviewed to ensure Minimum Documents received. Does the app have sufficient info? Application Assessed by MPO. Application Withdrawn after 5 days. More information requested from Broker. Application held for 5 working days then withdrawn. Does the app meet guidelines? Application Declined – Notification Issued Conditional Issued. Valuation ordered. Formal Approval (48 Hours) Formal Documentation (48 hours) File Settled No Yes No

Awards and Recognition Australian Home Loan Awards 2013 – Gold Medal – Best Loan for 1 st Home Buyers Australian Home Loan Awards 2013 – Silver Medal – Bank of the Year Australian Home Loan Awards 2013 – Silver Medal – Best Variable Rate Home Loans Australian Home Loan Awards 2013 – Bronze Medal – Best Fixed Rate Home Loans Mozo People’s Choice Awards 2014 – Top 5 Mutual Bank Mozo Experts Choice Awards 2015 – Discount Variable Special Rate Loan – Best Value Variable Rate Home Loan Money Magazine Best of the Best Awards 2015 – Home Advantage Variable - Cheapest Home Loan Package & Home Advantage Living Equity – Cheapest Line of Credit

Contacts – New South Wales  Paul Moses, State Intermediaries Manager  Phone: (02)  Mobile:  Fax: (02)   Jeff Thomas, Business Development Manager  Phone: (02)  Mobile:  Fax: (02)   Supporting Documents   Fax: (02)  Office Address Suite 2, Level 6, KPMG Building 111 Philip Street Parramatta NSW 2150  Credit Assessment  Phone: (02)  Fax: (02)  Broker Website   Gerald Allan, Business Development Manager  Phone: (02)  Mobile:  Fax: (02) 

Contacts – Northern Territory  Robin Rose, State Intermediaries Manager  Phone: (07)  Mobile:  Fax: (07)   Ken Sloane, Business Development Manager  Phone: (07)  Mobile:  Fax: (07)   Supporting Documents   Fax: (07)  Office Address Level 2, Petrie House 80 Petrie Terrace Brisbane Qld 4000  Credit Assessment  Phone: (07)  Fax: (07)  Broker Website 

Contacts – Queensland  Robin Rose, State Intermediaries Manager  Phone: (07)  Mobile:  Fax: (07)   Andrew Galloway, Business Development Manager  Phone: (07)  Mobile:  Fax: (07)   Ken Sloane, Business Development Manager  Phone: (07)  Mobile:  Fax: (07)   Supporting Documents   Fax: (07)  Office Address Level 2, Petrie House 80 Petrie Terrace Brisbane Qld 4000  Credit Assessment  Phone: (07)  Fax: (07)  Broker Website   Troy Cornelius, Business Development Manager  Phone: (07)  Mobile:  Fax: (07) 

Contacts – South Australia  Arthur Karvelas, State Intermediaries Manager  Phone: (03)  Mobile:  Fax: (03)   Mary Tarling, Business Development Manager  Mobile:  Fax:   Supporting Documents   Fax:  Office Address PO Box 506 Prospect East SA 5082  Credit Assessment  Phone:  Fax:  Broker Website 

Contacts – Tasmania  Arthur Karvelas, State Intermediaries Manager  Phone: (03)  Mobile:  Fax: (03)   Scott Cornford, Business Development Manager  Phone: (03)  Mobile:  Fax: (03)   Supporting Documents   Fax:  Office Address Suite 11c Professional Suites Como Centre 299 Toorak Road South Yarra Vic 3141  Credit Assessment  Phone: (03)  Fax: (03)  Broker Website 

Contacts – Victoria  Arthur Karvelas, State Intermediaries Manager  Phone: (03)  Mobile:  Fax: (03)   Scott Cornford, Business Development Manager  Phone: (03)  Mobile:  Fax: (03)   Tanya Brimblecombe, Business Development Manager  Phone: (03)  Mobile:  Fax: (03)   Supporting Documents   Fax: (03)  Office Address Suite 11c Professional Suites Como Centre 299 Toorak Road South Yarra Vic 3141  Credit Assessment  Phone: (03)  Fax: (03)  Broker Website 

Contacts – Western Australia  Paul Moses, State Intermediaries Manager  Phone: (02)  Mobile:  Fax: (02)   Jean Marie, Business Development Manager  Mobile:  Fax:   Supporting Documents   Fax:  Office Address Suite 2, Level 6, KPMG Building 111 Philip Street Parramatta NSW 2150  Credit Assessment  Phone: (02)  Fax: (02)  Broker Website   Kelvin Tan, Business Development Manager  Mobile:  Fax: 

All loans subject to application and approval. Fees, charges and conditions apply. Information correct as at 11 January 2016 and subject to change without notice. Heritage Bank Limited ABN AFSL Australian Credit Licence ^Where a valuation is required and only one property is offered as security, Heritage will pay for the valuation. If two or more securities are involved, or valuation costs exceed $330 (inclusive of GST), the difference is to be borne by the borrower.