Pillar 3 report Table of contents 2 | Westpac Group September 2021 Pillar 3 report Structure of Pillar 3 report Executive summary 3 Introduction 6 Risk appetite and risk types 7 Controlling and managing risk 8 Group structure 15 Capital overview 17 Leverage ratio 22 Credit risk management 24 Credit risk exposures 34 Credit risk mitigation 58 Counterparty credit risk 60 Securitisation 63 Market risk 73 Interest rate risk in the banking book 77 Operational risk 79 Equity risk 81 Funding and liquidity risk management 83 Liquidity coverage ratio 84 Net stable funding ratio 85 Remuneration 87 Appendices Appendix I – Regulatory capital reconciliation 94 Appendix II – Entities included in regulatory consolidation 100 Appendix III – Level 3 entities’ assets and liabilities 103 Appendix IV – Regulatory expected loss 104 Appendix V – APS330 quantitative requirements 105 Glossary 108 Disclosure regarding forward-looking statements 113 In this report references to ‘Westpac’, ‘Westpac Group’, ‘the Group’, ‘we’, ‘us’ and ‘our’ are to Westpac Banking Corporation and its controlled entities (unless the context indicates otherwise). In this report, unless otherwise stated or the context otherwise requires, references to '$', 'AUD' or 'A$' are to Australian dollars. Any discrepancies between totals and sums of components in tables contained in this report are due to rounding. In this report, unless otherwise stated, disclosures reflect the Australian Prudential Regulation Authority’s (APRA) implementation of Basel III. Information contained in or accessible through the websites mentioned in this report does not form part of this report unless we specifically state that it is incorporated by reference and forms part of this report. All references in this report to websites are inactive textual references and are for information only.

Pillar 3 report Executive summary Westpac Group September 2021 Pillar 3 report | 3 Key capital ratios 30 September 2021 31 March 2021 30 September 2020 Level 2 Regulatory capital structure Common equity Tier 1 capital after deductions $m 53,808 52,932 48,733 Risk weighted assets $m 436,650 428,899 437,905 Common equity Tier 1 capital ratio % 12.32 12.34 11.13 Additional Tier 1 capital ratio % 2.33 2.21 2.10 Tier 1 capital ratio % 14.65 14.55 13.23 Tier 2 capital % 4.21 3.88 3.15 Total regulatory capital ratio % 18.86 18.43 16.38 APRA leverage ratio % 5.99 6.27 5.78 Level 1 Regulatory capital structure Common equity Tier 1 capital after deductions $m 54,314 53,313 49,453 Risk weighted assets $m 431,422 424,656 433,727 Level 1 Common equity Tier 1 capital ratio % 12.59 12.55 11.40 Common equity Tier 1 capital ratio movement for Second Half 2021 (basis points) Westpac’s Common Equity Tier 1 (CET1) capital ratio was 12.32% at 30 September 2021, 2 basis points lower than 31 March 2021. Key movements in the CET1 capital ratio over the half were: Second Half 2021 cash earnings of $3,134 million, excluding notable items (72 basis point increase); Notable items (15 basis point decrease) from: o A $1,319m reduction in cash earnings; and o An increase in the deduction for deferred tax assets; partly offset by o Lower deductions for goodwill and capitalised software; Payment of the 2021 interim dividend (49 basis point decrease); An increase in Risk Weighted Assets (RWA) (16 basis point decrease) mostly related to the application of a mortgage risk weight floor of 25%; Capital deductions and other capital movements (19 basis point decrease) from: o capital invested in entities not consolidated for regulatory purposes; o a higher deduction for capitalised expenditure; o an increase in regulatory expected losses in excess of provisions; and o a revaluation of the defined benefit superannuation obligation; Foreign currency impacts from the depreciation of the A$ against the US$ and NZ$ (1 basis point decrease)1; A 26 basis point increase from divestments comprising: o A 7 basis point increase from the sale of Coinbase Inc. shares; o A 12 basis point increase from the sale of Westpac’s General Insurance business; and o A 7 basis point increase from the sale of Westpac’s Lender’s Mortgage Insurance business. 1 Reflecting the net impact of movements in the foreign currency translation reserve and RWA.

Pillar 3 report Executive summary 4 | Westpac Group September 2021 Pillar 3 report Risk Weighted Assets (RWA) $m 30 September 2021 31 March 202130 September 2020 Risk weighted assets at Level 2 Credit risk 357,295 347,127 359,389 Market risk 6,662 9,490 8,761 Operational risk 55,875 54,090 54,090 Interest rate risk in the banking book 11,446 11,998 9,124 Other 5,372 6,194 6,541 Total RWA 436,650 428,899 437,905 Total Exposure at Default 1,134,083 1,076,503 1,062,238 Total RWA increased $7.8 billion or 1.8% this half from higher credit RWA partly offset by a decrease in non-credit RWA. The $10.2 billion increase in credit RWA included: A $5.6 billion increase from higher lending in mortgages and corporate; A $5.1 billion increase from mortgage credit RWA from the decision to apply a mortgage risk weight floor of 25% (RWA to EAD). This mostly reflects our expectation that mortgage risk weights will rise from APRA’s capital changes, and because some rise in mortgage stress may emerge once COVID-19 stimulus unwinds; Foreign currency translation impacts increased RWA by $2.4 billion, mostly from the depreciation of the A$ against the US$ and NZ$, partially offset by; A $2.3 billion decrease from improved credit quality metrics with lower stressed assets across specialised lending and business lending; and A decrease in credit RWA associated with derivative exposures (counterparty credit risk and mark-to-market related credit risk) of $0.6 billion. Non-credit RWA was $2.4 billion lower, mainly due to a $2.8 billion decrease in market RWA as the volatile period around March 2020 (related to the onset of COVID-19) rolled out of the one-year Value at Risk (VaR) lookback window. Additional Tier 1 and Tier 2 Capital movements for Second Half 2021 On 15 September 2021, Westpac issued $1.75 billion of Additional Tier 1 capital (Westpac Capital Notes 8), of which approximately $1.15 billion comprised reinvestment by the holders of Westpac Capital Notes 4 (WCN 4) 1. The net impact was an increase in Tier 1 capital of approximately 14 basis points. During the half, Westpac issued EUR 1.0 billion (approximately A$1.6 billion) Tier 2 capital instruments. Westpac also redeemed NZ$0.4 billion of Tier 2 capital instruments. The net impact was an increase in the total regulatory capital ratio of approximately 28 basis points. These issues will assist to meet APRA’s increased total capital requirements that must be achieved by 1 January 2024. Exposure at Default Exposure at default increased $57.6 billion over the half, primarily due to an increase in exposure to sovereigns ($33.0 billion) due to higher liquid assets, residential mortgage lending ($19.3 billion) and corporate lending ($5.7 billion). Leverage Ratio The leverage ratio represents the amount of Tier 1 capital relative to exposure2. At 30 September 2021, Westpac’s leverage ratio was 5.99%, down 28 basis points since 31 March 2021. Liquidity Coverage Ratio (LCR) Westpac’s average LCR for the quarter ending 30 September 2021 was 129% (30 June 2021: 127%). 1 At 30 September 2021, approximately $0.6 billion of WCN 4 were outstanding. On 15 October 2021, Westpac issued a redemption notice that all outstanding WCN 4 will be redeemed on the optional redemption date, being 20 December 2021. 2 As defined under Attachment D of APS110: Capital Adequacy.

Pillar 3 report Executive summary Westpac Group September 2021 Pillar 3 report | 5 Net Stable Funding Ratio (NSFR) Westpac had an NSFR of 125%1 as at 30 September 2021 (30 June 2021: 123%). 1 Calculated as total available stable funding divided by total required stable funding as at end of the quarter.

Pillar 3 report Introduction 6 | Westpac Group September 2021 Pillar 3 report Westpac Banking Corporation is an Authorised Deposit-taking Institution (ADI) subject to regulation by APRA. APRA has accredited Westpac to apply advanced models permitted by the Basel III global capital adequacy regime to the measurement of its regulatory capital requirements. Westpac uses the Advanced Internal Ratings- Based approach (Advanced IRB) for credit risk and the Advanced Measurement Approach (AMA) for operational risk. In accordance with APS330 Public Disclosure, financial institutions that have received this accreditation, such as Westpac, are required to disclose prudential information about their risk management practices on a semi-annual basis. A subset of this information must be disclosed quarterly. This report describes Westpac’s risk management practices and presents the prudential assessment of Westpac’s capital adequacy as at 30 September 2021. In addition to this report, the regulatory disclosures section of the Westpac website1 contains the reporting requirements for: Capital instruments under Attachment B of APS330; and The identification of potential Global-Systemically Important Banks (G-SIB) under Attachment H of APS330 (disclosed annually). Capital instruments disclosures are updated when: A new capital instrument is issued that will form part of regulatory capital; or A capital instrument is redeemed, converted into CET1 capital, written off, or its terms and conditions are changed. 1 http://www.westpac.com.au/about-westpac/investor-centre/financial-information/regulatory-disclosures/

Pillar 3 report Risk appetite and risk types Westpac Group September 2021 Pillar 3 report | 7 Westpac’s appetite for risk is informed by our strategic objectives and business plans, regulatory rules and ratios, and the potential for adverse outcomes that result in material impacts on our customers, our staff, our reputation, our regulatory relationships and/or our financial position including the potential for capital and liquidity ratios to fall below target levels in stressed scenarios. Refer to the Strategic Review section of the Westpac 2021 Annual Report for a discussion on the current risk management issues facing Westpac. Westpac distinguishes between different types of risk and takes an integrated approach toward identifying, assessing, and managing risks. The annual review of Westpac’s Risk Management Framework, which includes the Risk Management Strategy and Board Risk Appetite Statement, together with the establishment and monitoring of key controls through supporting frameworks and policies all play vital roles. Overview of key risk types risk culture – the risk that our culture does not promote and reinforce behavioural expectations or structures to identify, understand, discuss and act on risks. This leads to ineffective risk management, poor risk awareness, risk-taking outside of risk appetite that is tolerated and a culture where key learnings are not integrated into Group-wide and customer outcomes, impeding continuous improvement; strategic risk – the risk that Westpac makes inappropriate strategic choices, does not implement its strategies successfully, or does not respond effectively to changes in the operating environment; capital adequacy risk – the risk that Westpac has an inadequate level or composition of capital to support its normal business activities and to meet its regulatory capital requirements under normal operating environments or stressed conditions; funding and liquidity risk – the risk that Westpac cannot meet its payment obligations or that it does not have the appropriate amount, tenor and composition of funding and liquidity to support its assets; credit risk – the risk of financial loss where a customer or counterparty fails to meet their financial obligations to Westpac. Climate risk is considered as a key aspect of managing credit risk at Westpac and has been integrated into the credit risk management framework; market risk – the risk of an adverse impact on earnings resulting from changes in the value of Westpac’s positions because of a change in financial market factors, such as foreign exchange rates, interest rates, commodity prices and equity prices. This includes interest rate risk in the banking book - the risk to interest income from a mismatch between the duration of assets and liabilities that arises in the normal course of business activities; operational risk – the risk of loss resulting from inadequate or failed internal processes, people and systems or from external events. The definition excludes strategic risk. While legal risk and regulatory risk arise through inadequate or failed processes, people, and systems or from external events, these are reflected primarily in compliance and conduct risk; cyber risk – the risk that Westpac or its third parties’ data or technology are inappropriately accessed, manipulated, or damaged from cybersecurity threats or vulnerabilities; compliance and conduct risk – the risk of failing to abide by compliance obligations required of us or otherwise failing to have behaviours and practices that deliver suitable, fair, and clear outcomes for our customers and that support market integrity; reputational and sustainability risk − the risk that an action, inaction, transaction, investment, or event will reduce trust in Westpac’s integrity and competence by clients, counterparties, investors, regulators, employees, or the public; and financial crime risk – the risk that Westpac fails to prevent financial crime and comply with applicable global financial crime regulatory obligations.

Pillar 3 report Controlling and managing risk Westpac Group September 2021 Pillar 3 report | 9 Risk management governance structure (continued) From the perspective of specific types of risk, the Board Risk Committee’s role includes: credit risk – reviewing and approving material policies and limits supporting the Group Credit Risk Management Framework, approving credit provisioning, and monitoring the risk profile, performance, and management of our credit portfolio; funding and liquidity risk – reviewing and approving key policies and limits supporting the Group Liquidity Risk Management Framework, including our annual funding strategy, recovery and resolution plans, liquidity targets and limits, and monitoring the liquidity position and requirements; capital adequacy risk – reviewing and approving key policies and limits supporting the Group Capital Adequacy Risk Management Framework, overseeing and approving the Internal Capital Adequacy Assessment Process (ICAAP) and monitoring the associated management of this risk; market risk – reviewing and approving key policies and limits supporting the Group Market Risk Management Framework, and reviewing and monitoring the market risk performance, exposures, and risk positions; operational risk – reviewing and approving key policies supporting the Group Operational Risk Management Framework and monitoring the performance of operational risk management and controls; cyber risk – reviewing and approving key policies supporting the Group Cyber Risk Management Framework and monitoring safeguards for assuring information and security; risk culture – reviewing and approving the Risk Culture Framework and monitoring the associated measurment and management of this risk; and reputational and sustainability risk – reviewing and approving the Group Reputation and Sustainability Risk Management Frameworks and monitoring the associated management of these risks. The Board Risk Committee also: oversees and approves the ICAAP and in doing so reviews and recommends the target capital ranges for regulatory capital and reviews and monitors capital levels for consistency with Westpac’s risk appetite; reviews, oversees and as appropriate, approves Westpac’s stress testing, including the material scenarios adopted and monitors material stress testing results and management responses; provides relevant periodic assurances and reports (as appropriate) to the Board Audit Committee; forms a view on Westpac’s risk culture and the extent to which it supports the ability of Westpac to operate consistently within the Group Risk Management Framework and Board Risk Appetite Statement and oversees the identification of, and steps taken to address, any desirable changes to risk culture and periodically reports to the Board; refers or recommends to the Board and any other Board Committees (as appropriate) any matters that have come to the attention of the Board Risk Committee that are relevant for the Board or the respective Board Committee; and in its capacity as the Westpac Group’s US Risk Committee, oversees the key risks, risk management framework and policies of Westpac’s US operations.

Pillar 3 report Controlling and managing risk 10 | Westpac Group September 2021 Pillar 3 report Risk management governance structure (continued) Board Legal, Regulatory and Compliance Committee (BLRCC) To assist the Board Risk Committee as it oversees: material legal and regulatory change relevant to Westpac; and Westpac’s management of: o material litigation (including class actions) and regulatory investigations; o compliance; o conduct risk; o financial crime risk; o customer remediation activities and customer complaints; and o such other operational risk activities as are delegated to the Board Legal, Regulatory & Compliance Committee by the Board Risk Committee. From the perspective of specific types of risk, the BLRCC role includes: financial crime risk – reviewing and approving the Group Financial Crime Risk Management Framework and key supporting policies and standards, including receiving information regarding material breaches of Westpac’s Anti-Bribery and Corruption (ABC) Policy and monitoring Westpac’s financial crime risk performance and controls; and compliance and conduct risk - reviewing and approving the Group Compliance and Conduct Risk Management Framework and key supporting policies and standards, and reviewing and monitoring Westpac's risk performance and controls. Board Committees with a Risk Focus Board Audit Committee (BAC) To assist the Board by overseeing the: integrity of financial statements and financial reporting systems of Westpac and its related bodies corporate; external audit engagement, including the external auditor’s appointment, removal and rotation of the lead audit engagement partner, and the external auditor’s qualifications, performance, independence and fees; performance of the internal audit function; and integrity of the Group’s corporate reporting including the Group‘s financial reporting. Board Remuneration Committee (BRC) To assist the Board by reviewing and recommending: the Group Remuneration Policy and assessing its effectiveness; individual remuneration levels of the Non-executive Directors, CEO, Group Executives, and other senior executives; remuneration structures for each category of persons covered by the Group Remuneration Policy; CEO’s goals and objectives and evaluating the CEO’s performance considering these objectives; short and long-term variable reward plans and outcomes and adjustments to variable remuneration for Group Executives and other senior executives; and approval of all equity-based plans. Board Technology Committee (BTC) To assist the Board as it oversees: the implementation of the Group’s technology and data strategy; and the delivery of major technology transformation programs.

Pillar 3 report Controlling and managing risk Westpac Group September 2021 Pillar 3 report | 11 Risk management governance structure (continued) Executive Team Westpac Executive Team (ET) executes the Board-approved strategy; delivers Westpac’s various strategic and performance goals within the approved risk appetite; approves position statements that guide Westpac’s response to sustainability issues; and monitors key risks within each business unit, capital adequacy and Westpac’s reputation. Executive risk committees Westpac Group Executive Risk Committee (RISKCO) leads the management and oversight of material risks across Westpac within the context of the risk appetite approved by the Board; oversees the effectiveness of the Risk Management Framework and the execution of the Risk Management Strategy; monitors and reviews Westpac’s risk profile for all identified material risks; shapes and promotes a strong risk culture; oversees emerging risks and allocates responsibility for assessing impacts and implementing appropriate actions to address these; reviews and monitors risk class risk management frameworks and key supporting policies; monitors the review of risk models, model risk and capital measurements and methodologies; monitors and reviews stress testing and scenario analysis; and supports the ICAAP and Recovery Plan for approval by the Board Risk Committee. Westpac Group Asset & Liability Committee (ALCO) leads the optimisation of funding and liquidity risk-reward across Westpac; reviews the level and quality of capital to ensure that it is commensurate with Westpac’s risk profile, business strategy and risk appetite; oversees the Liquidity Risk Management Framework and key policies; oversees the funding and liquidity risk profile and balance sheet risk profile; and identifies emerging funding and liquidity risks and oversees actions to respond as appropriate. Westpac Group Credit Risk Committee (CREDCO) reviews and oversees the Credit Risk Management Framework, Credit Risk Management Strategy, Credit Risk Appetite Statement, and key supporting policies; oversees Westpac’s credit risk profile; oversees the Climate Change Financial Risk Committee, which is chaired by the Group Chief Credit Officer and is responsible for the oversight of climate-related credit risk, including the potential impact on credit exposures from climate change-related transition and physical risks; and identifies emerging credit risks, allocates responsibility for assessing impacts, and responds as appropriate. Westpac Group Market Risk Committee (MARCO) reviews and oversees the Market Risk Management Framework and key market risk management policies; reviews policies and limits for managing traded and non-traded market risk; and reviews and oversees the market risk, equity risk and insurance risk profile.

Pillar 3 report Controlling and managing risk 12 | Westpac Group September 2021 Pillar 3 report Risk management governance structure (continued) Westpac Group Operational and Compliance Risk Committee (OPCO) leads the optimisation of operational, conduct and compliance risk across Westpac; reviews and oversees the Operational Risk Management Framework and the Compliance and Conduct Risk Management Framework, and key supporting policies; oversees Westpac’s operational risk and conduct and compliance risk profiles; and identifies emerging operational, conduct and compliance risks and appropriate actions to address these. Westpac Group Remuneration Oversight Committee (ROC) supporting the CEO, BRC and the Board by reviewing and approving remuneration frameworks, guidelines and short term variable reward plans underpinning the Board-approved Westpac Group Remuneration Policy from a Human Resources, Risk (including Compliance), Finance and Legal perspective and in line with external requirements; assisting the BRC and the Board in fulfilling its responsibility to oversee remuneration policies and practices of Westpac in the context that these policies and practices fairly and responsibly reward individuals having regard to customer and shareholder interests, long term financial soundness and prudent risk management; recommending to the CEO for recommendation to the BRC remuneration arrangements including remuneration review and remuneration adjustment outcomes for Responsible Persons, risk and financial control employees, Material Risk Takers and other individuals whose activities may impact the financial soundness of Westpac below the Group Executive level; and recommending to the CEO for recommendation to the BRC the criteria and rationale for determining the total quantum of Westpac’s variable reward pool. Prudential Reporting and Compliance Committee oversees from a Group-wide perspective, Westpac’s compliance with prudential requirements and regulatory reporting; oversees the effective management of prudential compliance breaches, incidents and issues including remediation actions; and monitors and reviews ongoing prudential governance activities, including changes to prudential standards. Reputation Risk Committee reviews issues with material reputation risk that arise in the operations of Westpac’s business to mitigate reputation risk and detrimental customer impacts. Westpac Group Financial Crime Risk and Compliance Committee oversees Anti-Money Laundering and Counter-Terrorism Financing, Anti- Bribery and Corruption, Sanctions and Tax Transparency within the context of the risk appetite approved by the Board; reviews and oversees the Financial Crime Risk Management Framework, key supporting policies, programs and standards; monitors and oversees Westpac’s financial crime risk profile; and identifies emerging financial crime risks, and appropriate actions to address these.

Pillar 3 report Controlling and managing risk Westpac Group September 2021 Pillar 3 report | 13 Risk management governance structure (continued) Risk function Risk Function promotes a strong risk culture; owns the design and content of the Risk Management Framework; defines the structure and coverage of risk appetite; defines the annual Risk Management Strategy to execute the Risk Management Framework ensuring that the management of risks is in alignment with risk appetite and business strategy; establishes risk policies, procedures and limits; measures and reports on risk levels; and provides oversight of and direction on the management of risks. Independent internal review Group Audit reviews the adequacy and effectiveness of management controls over risk. Divisional business units and Functions Business Units and Functions responsible for identifying, evaluating and managing the risks that they originate within approved risk appetite and policies; and establish and maintain appropriate risk management and compliance controls, resources and self-assessment processes.

Pillar 3 report Controlling and managing risk 14 | Westpac Group September 2021 Pillar 3 report Roles and responsibilities We have adopted and continue to embed a Three Lines of Defence model to aid in managing risk, within which all employees play an active role. The 1st Line of Defence – Business and support manages the risks they originate The 1st Line proactively identifies, evaluates, owns, and manages the risks in their business. It also seeks to ensure that business activities are within approved risk appetite and policies. In managing its risk, the 1st Line is required to establish and maintain appropriate governance structures, controls, resources, and self-assessment processes, including issue identification, recording and escalation procedures. This accountability cannot be abrogated. The 1st Line of defence is accountable for ‘self-certification’. The 2nd Line of Defence – Provides oversight, insight and control of 1st Line activities The 2nd Line sets risk frameworks, controls (including policies and limits), and standards for use across the Group. The 2nd Line can require remediation or cessation of activity where these are not adhered to. Their approach is designed to be risk-based and proportionate to 1st Line activities. The 2nd Lines role is to review and challenge 1st Line activities and decisions that may materially affect Westpac’s risk position, and independently evaluates the effectiveness of the 1st Line’s controls, monitoring, compliance, and monitors progress towards mitigating risks. In addition, the 2nd Line provides insight to the 1st Line, assisting in developing, maintaining, and enhancing the Business’ approach to risk management. The 2nd Line considers and reports the aggregated risk profile of the Group to facilitate end-to-end oversight of risk. The 3rd Line of Defence –Provides independent audit Group Audit is Westpac’s internal 3rd Line assurance function that provides the Board and Senior Executives with independent and objective evaluation of the adequacy and effectiveness of the Group’s governance, risk management and internal controls.

Pillar 3 report Group structure 16 | Westpac Group September 2021 Pillar 3 report Subsidiary banking entities Westpac New Zealand Limited (WNZL), a wholly owned subsidiary entity, is a registered bank incorporated in New Zealand and regulated by the Reserve Bank of New Zealand (RBNZ). WNZL uses the Advanced IRB approach for credit risk and the AMA for operational risk. Other subsidiary banking entities in the Group include Westpac Bank PNG-Limited and Westpac Europe Limited. For the purposes of determining Westpac’s capital adequacy subsidiary banking entities are consolidated at Level 2. Restrictions and major impediments on the transfer of funds or regulatory capital within the Group Minimum capital (‘thin capitalisation’) rules Tax legislation in most jurisdictions in which the Group operates prescribes minimum levels of capital that must be retained in that jurisdiction to avoid a portion of the interest costs incurred in the jurisdiction ceasing to be tax deductible. Capital for these purposes includes both contributed capital and non-distributed retained earnings. Westpac seeks to maintain sufficient capital/retained earnings to comply with these rules. Tax costs associated with repatriation Repatriation of retained earnings (and capital) may result in tax being payable in either the jurisdiction from which the repatriation occurs or Australia on receipt of the relevant amounts. This cost would reduce the amount actually repatriated. Intra-group exposure limits Exposures to related entities are managed within the prudential limits prescribed by APRA in APS222 Associations with Related Entities1. Westpac has an internal limit structure and approval process governing credit exposures to related entities. This limit structure and approval process, combined with APRA’s prudential limits, is designed to reduce the potential for unacceptable contagion risk. Prudential regulation of subsidiary entities Certain subsidiary banking, insurance and trustee entities are subject to local prudential regulation in their own right, including capital adequacy requirements and investment or intra-group exposure limits. Westpac seeks to ensure that its subsidiary entities are adequately capitalised and adhere to regulatory requirements at all times. There are no capital deficiencies in subsidiary entities excluded from the regulatory consolidation at Level 2. On 23 March 2021, the RBNZ issued two notices to WNZL under section 95 of the Reserve Bank of New Zealand Act 1989 requiring WNZL to supply two external reviews to the RBNZ. The reviews are required to address prudential concerns raised by the RBNZ around WNZL’s risk governance practices and policies following various compliance issues reported over recent years. Those issues include non-compliance with the RBNZ’s liquidity, capital adequacy and outsourcing requirements and IT outages. While work has been underway to address these areas for some time, more work is required to meet WNZL’s expectations and those of the regulator. From 31 March 2021, the RBNZ amended WNZL’s conditions of registration, requiring WNZL to discount the value of its liquid assets by approximately 14% which at 30 September 2021 was NZ$2.5 billion. This overlay will apply until the RBNZ is satisfied that: the RBNZ's concerns regarding liquidity risk controls have been resolved; and sufficient progress has been made to address risk culture issues in WNZL's Treasury and Market and Liquidity Risk functions. The RBNZ has appointed independent advisers to supply the report on liquidity risk controls and risk culture and the report on the effectiveness of risk governance. 1 For the purposes of APS222, subsidiaries controlled by Westpac, other than subsidiaries that form part of the ELE, represent ‘related entities’. Prudential and internal limits apply to intra-group exposures between the ELE and related entities, both on an individual and aggregate basis.

Pillar 3 report Capital overview Westpac Group September 2021 Pillar 3 report | 17 Capital Structure This table shows Westpac’s capital resources under APS111 Capital Adequacy: Measurement of Capital. 30 September 31 March 30 September $m 2021 2021 2020 Common equity Tier 1 capital Paid up ordinary capital 41,601 41,604 40,509 Treasury shares (663) (660) (620) Equity based remuneration 1,753 1,731 1,661 Foreign currency translation reserve (266) (519) (309) Accumulated other comprehensive income 402 507 126 Non-controlling interests - other 57 49 57 Retained earnings 28,813 29,097 26,533 Less retained earnings in life and general insurance, funds management and securitisation entities (1,118) (1,680) (1,132) Deferred fees 238 230 214 Total common equity Tier 1 capital 70,817 70,359 67,039 Deductions from common equity Tier 1 capital Goodwill (excluding funds management entities) (8,060) (8,529) (8,532) Deferred tax assets (2,429) (2,260) (2,963) Goodwill in life and general insurance, funds management and securitisation entities (209) (451) (535) Capitalised expenditure (1,951) (1,749) (1,576) Capitalised software (1,840) (2,049) (2,137) Investments in subsidiaries not consolidated for regulatory purposes (2,044) (2,063) (1,941) Regulatory expected loss in excess of eligible provisions1 (225) (93) (40) Defined benefit superannuation fund surplus (64) (69) (71) Equity investments (163) (162) (492) Regulatory adjustments to fair value positions (24) (1) (18) Other Tier 1 deductions - (1) (1) Total deductions from common equity Tier 1 capital (17,009) (17,427) (18,306) Total common equity Tier 1 capital after deductions 53,808 52,932 48,733 Additional Tier 1 capital Basel III complying instruments 10,180 9,493 9,206 Total Additional Tier 1 capital 10,180 9,493 9,206 Deductions from Additional Tier 1 capital Holdings of own and other financial institutions Additional Tier 1 capital instruments (25) (25) - Total deductions from Additional Tier 1 capital (25) (25) - Net Addititional Tier 1 regulatory capital 10,155 9,468 9,206 Net Tier 1 regulatory capital 63,963 62,400 57,939 Tier 2 capital Basel III complying instruments 18,228 16,373 13,161 Basel III transitional instruments 487 462 494 Eligible general reserve for credit loss 51 161 397 Total Tier 2 capital 18,766 16,996 14,052 Deductions from Tier 2 capital Investments in subsidiaries not consolidated for regulatory purposes (140) (140) (140) Holdings of own and other financial institutions Tier 2 capital instruments (221) (199) (121) Total deductions from Tier 2 capital (361) (339) (261) Net Tier 2 regulatory capital 18,405 16,657 13,791 Total regulatory capital 82,368 79,057 71,730 1 An explanation of the relationship between this deduction, regulatory expected loss and provisions for impairment charges is contained in Appendix IV.

Pillar 3 report Leverage ratio 22 | Westpac Group September 2021 Pillar 3 report Leverage ratio The following table summarises Westpac’s leverage ratio. This has been determined using APRA’s definition of the leverage ratio as specified in APS110 Capital Adequacy. $ billion 30 September 2021 30 June 2021 31 March 2021 31 December 2020 Tier 1 Capital 64.0 62.2 62.4 61.0 Total Exposures 1,068.3 1,049.9 995.8 984.3 Leverage ratio 6.0% 5.9% 6.3% 6.2% Leverage ratio disclosure $m 30 September 2021 On-balance sheet exposures 1 On-balance sheet items (excluding derivatives and securities financing transactions (SFTs), but including collateral) 912,282 2 (Asset amounts deducted in determining Tier 1 capital) (17,009) 3 Total on-balance sheet exposures (excluding derivatives and SFTs) (sum of rows 1 and 2) 895,273 Derivative exposures 4 Replacement cost associated with all derivatives transactions (i.e. net of eligible cash variation margin) 6,980 5 Add-on amounts for potential future credit exposure (PFCE) associated with all derivatives transactions 15,503 6 3,127 7 (Deductions of receivables assets for cash variation margin provided in derivatives transactions) (5,782) 8 (Exempted central counterparty (CCP) leg of client-cleared trade exposures) - 9 Adjusted effective notional amount of written credit derivatives 1,057 10 (Adjusted effective notional offsets and add-on deductions for written credit derivatives) (1,052) 11 Total derivative exposures (sum of rows 4 to 10) 19,833 SFT exposures 12 Gross SFT assets (with no recognition of netting), after adjusting for sales accounting transactions 38,836 13 (Netted amounts of cash payables and cash receivables of gross SFT assets) - 14 Counterparty credit risk exposure for SFT assets 12,845 15 Agent transaction exposures - 16 Total SFT exposures (sum of rows 12 to 15) 51,681 Other off-balance sheet exposures 17 Off-balance sheet exposure at gross notional amount 213,611 18 (Adjustments for conversion to credit equivalent amounts) (112,080) 19 Other off-balance sheet exposures (sum of rows 17 and 18) 101,531 Capital and total exposures 20Tier 1 Capital 63,963 21 Total exposures (sum of rows 3, 11, 16 and 19) 1,068,318 Leverage ratio % 22 Leverage ratio 5.99% Gross-up for derivatives collateral provided where deducted from the balance sheet assets pursuant to the Australian Accounting Standards

Pillar 3 report Credit risk management 24 | Westpac Group September 2021 Pillar 3 report Credit risk is the potential for financial loss where a customer or counterparty fails to meet their financial obligations to Westpac. Westpac maintains a credit risk management framework and a number of supporting policies, processes and controls governing the assessment, approval and management of customer and counterparty credit risk. These incorporate the assignment of risk grades, the quantification of loss estimates in the event of default, and the segmentation of credit exposures. Structure and organisation The Chief Risk Officer (CRO) is responsible for the effectiveness of overall risk management throughout Westpac, including credit risk. The Group Chief Credit Officer is responsible for the effectiveness of credit risk management, including credit approval decisioning beyond business authority level and appointing our most senior authorised credit officers. Authorised credit officers have delegated authority to approve credit risk exposures, including customer risk grades, other credit parameters and their ongoing review. Our largest exposures are approved by our most experienced authorised credit officers jointly with the most senior business managers. Line business management is responsible for managing credit risks originated in their business and for managing risk adjusted returns from their business credit portfolios, within the approved risk appetite, risk management framework and policies. Credit risk management framework and policies Westpac maintains a credit risk management framework and supporting policies that are designed to clearly define roles and responsibilities, acceptable practices, limits and key controls. The Credit Risk Management Framework describes the principles, methodologies, systems, roles and responsibilities, reports and controls that exist for managing credit risk in Westpac. The Credit Risk Rating System policy describes the credit risk rating system philosophy, design, key features and uses of rating outcomes. Concentration risk policies cover individual counterparties, specific industries (e.g. property) and individual countries. In addition, we have policies covering risk appetite statements, environmental, social and governance (ESG) risk, credit risks and the delegation of credit approval authorities. At the divisional level, credit manuals embed the Group’s framework requirements for application in line businesses. These manuals include policies covering the origination, evaluation, approval, documentation, settlement and on-going management of credit risks, and sector policies to guide the extension of credit where industry-specific guidelines are considered necessary. Credit approval limits govern the extension of credit and represent the formal delegation of credit approval authority to responsible individuals throughout the organisation.

Pillar 3 report Credit risk management 26 | Westpac Group September 2021 Pillar 3 report Mapping of Basel categories to Westpac portfolios APS113 Capital Adequacy: Internal Ratings-Based Approach to Credit Risk, states that under the Advanced IRB approach to credit risk, an ADI must categorise banking book exposures into six broad IRB asset classes and apply the prescribed treatment for those classes to each credit exposure within them for the purposes of deriving its regulatory capital requirement. Standardised and Securitised portfolios are subject to treatment under APS112 Capital Adequacy: Standardised Approach to Credit Risk and APS120 Securitisation respectively. APS Asset Class Sub-asset class Westpac category Segmentation criteria Corporate Corporate Corporate All transaction-managed customers not elsewhere classified where annual turnover exceeds $50 million1. SME Corporate Business Lending All transaction-managed customers not elsewhere classified where annual turnover is $50 million or less. Project Finance (including Object Finance) Specialised Lending- Project Finance Applied to transaction-managed customers where the primary source of debt service, security and repayment is derived from the revenue generated by a completed project (e.g. infrastructure such as toll roads or railways). Income- producing Real Estate Specialised Lending- Property Finance Applied to transaction-managed customers where the primary source of debt service, security and repayment is derived from either the sale of a property development or income produced by one or more investment properties2. Sovereign Sovereign Applied to transaction-managed exposures backed by governments. Bank Bank Applied to transaction-managed exposures to deposit-taking institutions and foreign equivalents. Residential Mortgages Residential Mortgages Exposures secured by residential mortgages not elsewhere classified. Qualifying Revolving Retail Australian Credit Cards Program-managed credit cards with low volatility in loss rates. The New Zealand cards portfolio is not eligible for Qualifying Revolving Retail treatment and is classified in Other Retail. Other Retail Small Business Program-managed business lending exposures under $1 million where complex products are not utilised by the customer. Other Retail All other program-managed lending to retail customers, including New Zealand credit cards. 1 Includes all NZ agribusiness loans, regardless of turnover. 2 Excludes large diversified property groups and property trusts, which appear in the Corporate asset class.

Pillar 3 report Credit risk management Westpac Group September 2021 Pillar 3 report | 27 Mapping of Credit risk approach to Basel categories and exposure types Approach APS asset class Types of exposures Transaction-Managed Portfolios Corporate Sovereign Bank Direct lending Contingent lending Derivative counterparty Asset warehousing Underwriting Secondary market trading Foreign exchange settlement Other intra-day settlement obligations Program-Managed Portfolios Residential mortgage Mortgages Equity access loans Qualifying revolving retail Australian credit cards Other retail Personal loans Overdrafts New Zealand credit cards Auto and equipment finance Business development loans Business overdrafts Other term products Internal ratings process for transaction-managed portfolios The process for assigning and approving individual customer PDs and facility LGDs involves: Business unit representatives recommend the CRG and facility LGDs under the guidance of criteria set out in established credit policies. Each CRG is associated with an estimated PD; Authorised credit officers evaluate the recommendations and approve the final CRG and facility LGDs. Authorised credit officers may override line business unit recommendations; An expert judgement decisioning process is employed to evaluate CRG and the outputs of various risk grading models are used as one of several inputs into that process; and Authorised credit officers’ decisions are subject to reviews to ensure consistent quality and confirm compliance with approval authority. For on-going exposures to transaction-managed customers, risk grades and facility LGDs are required to be reviewed at least annually, but also whenever material changes occur. No material deviations from the reference definition of default are permitted. Internal ratings process for program-managed portfolios The process for assigning PDs, LGDs and EADs to the program-managed portfolio involves dividing the portfolio into a number of pools per product. These pools are created by analysing risk characteristics that have historically predicted that an account is likely to go into default or loss. No material deviations from the reference definition of default are permitted. Internal credit risk ratings system In addition to using the credit risk estimates as the basis for regulatory capital purposes, they are also used for the purposes described below: Economic capital - Economic capital includes both credit and non-credit components. Economic credit capital is calculated using a framework that considers estimates of PD, LGD, EAD, total committed exposure and loan tenor, as well as measures of portfolio composition not reflected in regulatory capital formulae. Provisioning - Credit provisions are held by Westpac to cover expected credit losses in the loan portfolio. Provisioning includes both individual and collective components. Individual provisions are calculated on impaired loans taking into account management’s best estimate of the present value of future cashflows.

Pillar 3 report Credit risk management 28 | Westpac Group September 2021 Pillar 3 report Collective provisions are established on a portfolio basis using a framework that considers PD, LGD, EAD, total committed exposure, level of arrears, recent past experience and forward looking macro-economic forecasts. Risk-adjusted performance measurement - Business performance is measured using allocated capital, which incorporates charges for economic capital and regulatory capital, including credit capital and capital for other risk types. Pricing - Westpac prices loans to produce an acceptable return on the capital allocated to the loan. Returns include interest income and fees after expected credit losses and other costs. Credit approval - For transaction-managed facilities, approval authorities are tiered based on the CRG, with lower limits applicable for customers with a higher PD. Program-managed facilities are approved on the basis of application scorecard outcomes and product based approval authorities. Control mechanisms for the credit risk rating system include: Westpac’s credit risk rating system is reviewed annually to confirm that the rating criteria and procedures are appropriate given the current portfolio and external conditions; All models materially impacting the risk rating process are periodically reviewed in accordance with Westpac’s model risk policy; Specific credit risk estimates (including PD, LGD and EAD levels) are overseen, reviewed annually and supported by the Credit Risk Estimates Committee (a sub-committee of CREDCO) for approval by General Manager, Enterprise Risk; Credit Risk Assurance undertake an independent annual end-to-end technical and operational review of the overall process; and CREDCO, RISKCO and BRiskC monitor the risk profile, performance and management of Westpac’s credit portfolio and the development and review of key credit risk policies. Risk reporting A comprehensive report on Westpac's credit risk portfolio is provided to CREDCO, RISKCO and BRiskC quarterly. It details the current level of impairment losses, stressed exposures, delinquency trends, provisions, impaired assets and key performance metrics. It also reports on portfolio concentrations and large exposures. Credit risk and asset quality are also reported to the Board, including details of impairment losses, stressed exposures, delinquency trends and key performance metrics. Response to COVID-19 Westpac remains focused on supporting customers. In response to the COVID-19 pandemic Westpac introduced a range of support packages such as lowering interest rates on certain products, waiving certain fees and providing impacted customers with an option to defer repayments. APRA permitted customers approved for deferrals to be excluded from traditional stress metrics while part of these support packages but customers were to be closely monitored, particularly once the deferral period ended. APRA has also revised prudential standard APS 220 Credit Quality to provide temporary capital relief for eligible credit exposures to certain individuals and small to medium sized enterprises, where the borrower has been affected by the COVID-19 pandemic. Under the current prudential standard, this concessional treatment can be applied to eligible exposures in the period from 8 July 2021 to 30 September 2021. The Australian Government SME Recovery Loan Scheme (SMERLS) provides eligible companies assistance with dealing with the economic impacts of COVID-19. The Australian Government announced on 25 August 2021, companies are no longer required to have received JobKeeper during the March quarter of 2021, or to have been a flood affected business, to be eligible. Westpac has confirmed to the Australian Government Federal Treasury our participation to the scheme.

Pillar 3 report Credit risk management 30 | Westpac Group September 2021 Pillar 3 report Loan impairment provisions Expected credit losses (ECL) are estimates of the cashflow shortfalls expected to result from defaults over the relevant timeframe. They are determined by evaluating a range of possible outcomes and taking into account the time value of money, past events, current conditions and forecasts of future economic conditions. Westpac calculates provisions for ECL based on a three-stage approach: Stage 1: 12 months ECL (performing) - For financial assets where there has been no significant increase in credit risk since origination, a provision for 12-month ECL is recognised. Stage 2: Lifetime ECL (performing) - For financial assets where there has been a significant increase in credit risk since origination and where the asset is still performing, a provision for lifetime ECL is recognised. Determining when a financial asset has experienced a significant increase in credit risk since origination is a critical accounting judgement. In the current period the Group has revised the methodology to determine a significant increase in risk from one which was primarily based on changes in internal customer risk grades since origination of the facility and based on a sliding scale, to one which is directly driven by the change in the probability of default (PD) since origination. In determining whether a change in PD represents a significant increase in risk, relative changes in PD and absolute PD thresholds are both considered based on the portfolio of the exposure. This change did not have a material impact to the Group. Stage 3: Lifetime ECL (non-performing) - For financial assets that are non-performing a provision for lifetime ECL is recognised. Indicators include a breach of contract with Westpac such as a default on interest or principal payments, a borrower experiencing significant financial difficulties. Collective and individual assessment - Financial assets that are in Stages 1 and 2 are assessed on a collective basis as are financial assets in Stage 3 below specified exposure thresholds. Those financial assets in Stage 3 above the specified exposure thresholds are assessed on an individual basis. Expected life - Lifetime ECL represents the expected credit losses that result from default events over the expected life of a financial instrument. In considering lifetime ECL, the remaining contractual life is used for non- retail portfolios. For retail portfolios lifetime ECL is calibrated to historically observed portfolio behaviour. Forward looking information - The measurement of ECL for each stage and the assessment of significant increase in credit risk considers information about past events and current conditions as well as reasonable and supportable projections of future events and economic conditions. In order to capture the asymmetry of the losses expected over the range of plausible future events and economic conditions, Westpac considers three future macroeconomic scenarios i.e. base, upside and downside scenarios. The macroeconomic variables used in these scenarios, include (but are not limited to) employment to population ratio, real gross domestic product growth rates and residential and commercial property price indices. The ECL is a weighted average of the credit losses expected under these three scenarios. The scenario weights are based on Westpac’s assessment of upside and downside risks taking into account current trends, forward looking conditions and the degree of uncertainty attached to these projections. Regulatory classification of loan impairment provisions APS220 Credit Quality requires that Westpac report specific provisions and a General Reserve for Credit Loss (GRCL). All IAPs raised under Australian Accounting Standards (AAS) are classified as specific provisions. All Collectively Assessed Provisions (CAPs) raised under AAS are either classified into specific provisions or a GRCL.

Pillar 3 report Credit risk management Westpac Group September 2021 Pillar 3 report | 31 Expected credit loss provision 1 30 September 2021 Total Regulatory $m IAPs CAPs Provisions Specific Provisions for impaired loans 832 334 1,166 for defaulted but not impaired loans - 806 806 For Stage 2 - 1,877 1,877 Total Specific Provision1 832 3,017 3,849 General Reserve for Credit Loss1 - 1,158 1,158 Total provisions for ECL 832 4,175 5,007 31 March 2021 Total Regulatory $m IAPs CAPs Provisions Specific Provisions for impaired loans 564 410 974 for defaulted but not impaired loans NA 918 918 For Stage 2 NA 2,051 2,051 Total Specific Provision1 564 3,379 3,943 General Reserve for Credit Loss1 NA 1,565 1,565 Total provisions for ECL 564 4,944 5,508 30 September 2020 Total Regulatory $m IAPs CAPs Provisions Specific Provisions for impaired loans 611 541 1,152 for defaulted but not impaired loans NA 1,021 1,021 For Stage 2 NA 2,199 2,199 Total Specific Provision1 611 3,761 4,372 General Reserve for Credit Loss1 NA 1,791 1,791 Total provisions for ECL 611 5,552 6,163 A-IFRS Provisions A-IFRS Provisions A-IFRS Provisions 1 Provisions classified according to APRA’s letter dated 4 July 2017 “Provisions for regulatory purposes and AASB 9 financial instruments”.

Pillar 3 report Credit risk exposures Westpac Group September 2021 Pillar 3 report | 35 Exposure at Default by measurement method 30 September 2021 IRB Standardised Total Exposure $m Approach Approach at Default Corporate 130,245 6,839 137,084 Business lending 52,420 685 53,105 Sovereign 176,238 1,312 177,550 Bank 21,283 144 21,427 Residential mortgages 582,136 5,516 587,652 Australian credit cards 15,394 - 15,394 Other retail 11,518 1,815 13,333 Small business 30,877 - 30,877 Specialised lending 66,732 368 67,100 Securitisation 30,561 - 30,561 Total 1,117,404 16,679 1,134,083 31 March 2021 IRB Standardised Total Exposure $m Approach Approach at Default Corporate 124,567 5,113 129,680 Business lending 53,052 766 53,818 Sovereign 143,237 1,081 144,318 Bank 23,404 140 23,544 Residential mortgages 562,798 6,006 568,804 Australian credit cards 16,459 - 16,459 Other retail 12,579 1,812 14,391 Small business 31,941 - 31,941 Specialised lending 64,867 382 65,249 Securitisation 28,299 - 28,299 Total 1,061,203 15,300 1,076,503 30 September 2020 IRB Standardised Total Exposure $m Approach Approach at Default Corporate 129,988 6,131 136,119 Business lending 54,542 866 55,408 Sovereign 131,857 1,216 133,073 Bank 23,244 152 23,396 Residential mortgages 550,133 6,471 556,604 Australian credit cards 16,944 - 16,944 Other retail 13,471 1,735 15,206 Small business 32,758 - 32,758 Specialised lending 65,491 422 65,913 Securitisation 26,817 - 26,817 Total 1,045,245 16,993 1,062,238

Pillar 3 report Credit risk exposures 46 | Westpac Group September 2021 Pillar 3 report Project and object finance 30 September 2021 Exposure at Regulatory Risk Weighted $m Risk Weight Default Expected Loss Assets Strong 70% 7,158 29 5,011 Good 90% 1,242 10 1,118 Satisfactory 115% 275 8 316 Weak 250% 120 10 299 Default NA - - - Total 8,795 56 6,744 31 March 2021 Exposure at Regulatory Risk Weighted $m Risk Weight Default Expected Loss Assets Strong 70% 6,341 25 4,439 Good 90% 1,521 12 1,369 Satisfactory 115% 303 8 348 Weak 250% 93 7 233 Default NA - - - Total 8,258 54 6,389 30 September 2020 Exposure at Regulatory Risk Weighted $m Risk Weight Default Expected Loss Assets Strong 70% 6,769 27 4,738 Good 90% 1,183 9 1,065 Satisfactory 115% 751 21 864 Weak 250% 41 3 103 Default NA 18 9 - Total 8,762 69 6,770

Pillar 3 report Credit risk mitigation 58 | Westpac Group September 2021 Pillar 3 report This section describes the way in which Westpac reduces its credit risk by using financial collateral, guarantees or credit derivatives for the Corporate, Sovereign and Bank asset classes. Approach Westpac recognises credit risk mitigation only when formal legal documentation is held that establishes Westpac’s direct, irrevocable and unconditional recourse to the collateral or to an unrelated credit risk mitigation provider. Minimum standards for recognising credit risk mitigation are set out in Westpac's credit rules and policies. All proposals for recognising risk mitigation require approval by an authorised credit officer. Authorised credit officer approval is also required for existing risk mitigation to be discontinued or withdrawn. The amount of credit risk mitigation recognised is the face value of the mitigation instrument, adjusted by the application of discounts for any maturity and/or currency mismatch with the underlying obligation, so that a discounted amount is recognised when calculating the residual exposure after mitigation. For regulatory capital purposes: exposures secured by eligible financial collateral, either cash or certain government or semi-government securities, or where protection is bought via credit linked notes, provided proceeds are invested in eligible financial collateral, are included at the gross value, with risk weighted assets for the portion thus secured calculated by applying a 5% LGD1; exposures mitigated by eligible guarantees, standby letters of credit or similar instruments, where Westpac has direct recourse to an unrelated third party, or credit protection bought via credit default swaps where Westpac is entitled to recover either full principal or credit losses on occurrence of defined credit events, are treated under double default rules where the protection provider is rated A-/A3 or better. The GCCO has the authority to approve exceptions to the A-/A3 minimum; and exposures mitigated by guarantees, letters of credit, credit default swaps or similar instruments, which are not eligible for double default treatment are treated under the substitution approach. When Westpac uses credit risk mitigation techniques to reduce counterparty exposure, limits are applied to both gross (i.e. pre-mitigation) and net exposure. Furthermore, exposure is recorded against the provider of any credit risk mitigation and a limit framework prevents excessive concentration to such counterparties. Netting Risk reduction by way of current account set-offs is recognised for exposures to creditworthy customers domiciled in Australia and New Zealand only. Customers are required to enter into formal agreements giving Westpac the unfettered right to set-off gross credit and debit balances in their nominated accounts to determine Westpac’s net exposure within each of these two jurisdictions. Cross-border set-offs are not permitted. Close-out netting is undertaken for off-balance sheet financial market transactions with counterparties with whom Westpac has entered into master netting agreements which allow such netting in specified jurisdictions. Close-out netting effectively aggregates pre-settlement risk exposure at time of default, thus reducing overall exposure. Collateral valuation and management Westpac revalues financial markets and associated collateral positions on a daily basis to monitor the net risk position, and has formal processes in place so that calls for collateral top-up or exposure reduction are made promptly. An independent operational unit has responsibility for monitoring these positions. The collateralisation arrangements are documented via the Credit Support Annex of the International Swaps and Derivatives Association (ISDA) master agreement for derivatives transactions and Global Master Repurchase Agreement (GMRA) for repurchase transactions and Clearing Agreements for cleared trades. 1 Excludes collateralised derivative transactions.

Pillar 3 report Counterparty credit risk 60 | Westpac Group September 2021 Pillar 3 report This section describes Westpac’s exposure to credit risk arising from derivative and treasury products. Approach Westpac actively assesses and manages the derivative and treasury credit risk (known collectively as counterparty credit risk) arising from its derivatives business. Westpac’s process for managing counterparty credit risk is based on its assessment of the potential future credit risk Westpac is exposed to when dealing in derivatives products and securities financing transactions. Westpac quantifies this risk through a daily simulation of future market price and rate shocks and converts the effect of these shocks on the mark-to-market value of Westpac’s positions to a credit exposure using Westpac’s Derivative Risk Equivalent (DRE) methodology. Exposures are loaded into Westpac’s credit limit management system where they are checked against pre-settlement risk limits that are set at the counterparty level. Limit excesses are reported to credit managers and actioned within strict timeframes. Structure and organisation The Financial Markets Credit management team is charged with managing the counterparty credit exposure arising from derivatives and treasury products. Market related credit risk There are two components to the regulatory capital requirements for credit risk arising from derivative products: capital to absorb losses arising from the default of derivative counterparties; and capital to absorb losses arising from mark-to-market valuation movements resulting from changes in the credit quality of derivative counterparties. These valuation movements are referred to as credit valuation adjustments (CVA) and this risk is sometimes labelled as CVA risk. Westpac refers to this requirement as mark-to-market related credit risk. Risk mitigation Mitigation is achieved in a number of ways: the limit system monitors for excesses of the pre-defined limits, with any excesses being notified to authorised credit officers; Westpac has netting agreements with counterparties to allow the exposure across a portfolio of trades with the same counterparty to be netted; Westpac has collateral agreements with its largest counterparties. The market value of the counterparty’s portfolio is used to recalculate the credit position at each end of day, with collateral being called for when certain pre-set limits are met or exceeded. Westpac exchanges Initial Margin with eligible counterparties for eligible products as protection against potential future exposure to changes in market value; Westpac has initial margin agreements with qualifying counterparties subject to relevant international regulations. The exchange of initial margin for eligible products covers the potential future exposure that could arise from changes in the market value of derivative transactions over the close-out period in the event of a counterparty default; credit derivatives are used to mitigate credit exposure against certain counterparties; and regular marking to market and settling of the foreign exchange components of foreign exchange reset contracts. Counterparty derivative exposures and limits The risk management methodology for counterparty derivatives exposures is similar to the credit methodology for transaction-managed loans. The main difference is in the estimation of the exposure for derivatives which is based on the DRE methodology. DRE is a credit exposure measure for derivative trades which is calibrated to a ‘loan- equivalent’ exposure. Counterparty credit limits are approved on an uncommitted and unadvised basis by authorised credit officers. This follows an evaluation of each counterparty’s credit worthiness and establishing an agreed credit risk appetite for the nature and extent of prospective business.

Pillar 3 report Counterparty credit risk 62 | Westpac Group September 2021 Pillar 3 report 30 September 2020 Westpac Portfolio Intermediation activities Credit derivatives products used ($m) Bought Sold Bought Sold Credit Default Swaps - 8 - - Total Return Swaps - - - - Credit options - - - - Credit linked notes - - - - Collateralised Loan Obligations - - - - Other - - - - Total - 8 - -

Pillar 3 report Securitisation Westpac Group September 2021 Pillar 3 report | 63 A securitisation is a financial structure where the cash flow from a pool of assets is used to service obligations to at least two different tranches or classes of creditors (typically holders of debt securities), with each class or tranche reflecting a different degree of credit risk (i.e. one class of creditors is entitled to receive payments from the pool before another class of creditors). Securitisation transactions are generally grouped into two broad categories: traditional or true sale securitisations, which involve the transfer of ownership of the underlying asset pool to a third party; and synthetic transactions, where the ownership of the pool remains with the originator and only the credit risk of the pool is transferred to a third party, using credit derivatives or guarantees. Covered bond transactions, in which bonds issued by Westpac are guaranteed by assets held in a special purpose vehicle, are not considered to be securitisation transactions. Approach Westpac’s involvement in securitisation activities ranges from a seller of its own assets to an investor in third-party transactions and includes the arranging of transactions, the provision of securitisation services and the provision of funding for clients, including clients requiring access to capital markets. Securitisation of Westpac originated assets - Securitisation is a funding, liquidity and capital management tool. It allows Westpac the ability to liquefy a pool of assets and increase Westpac’s wholesale funding capacity. Westpac may provide arm’s length facilities to the securitisation vehicles. The facilities entered into typically include the provision of liquidity, funding, underwriting and derivative contracts. Westpac has entered into on balance sheet securitisation transactions whereby loans originated by Westpac are transformed into stocks of saleable mortgage backed securities and held in the originating bank’s liquid asset portfolio. These ‘self securitisations’ do not change risk weighted assets1. No securitisation transactions for Westpac originated assets are classified as a resecuritisation. Securitisation in the management of Westpac’s credit portfolio - Westpac uses securitisation, including portfolio credit default swaps, to manage its corporate and institutional loan and counterparty credit risk portfolios. Single name credit default swaps are not treated as securitisations but as credit risk mitigation facilities. Transactions are entered into to manage counterparty credit risk or concentration risks. Provision of securitisation services, including funding and arranging asset backed bond issues – Westpac provides services to clients wishing to access asset-backed financing through securitisation. Those services include the provision of warehouse and term funding of securitised assets and arranging asset backed bond issues. Securitisation facilities provided by Westpac include resecuritisation exposures which are securitisation exposures in which the risk associated with an underlying pool of exposures is tranched and at least one of the underlying exposures is itself a securitisation exposure. Westpac also buys and sells securitisation exposures in the secondary market to facilitate portfolio management activity by its institutional customers who hold asset backed bonds. Westpac’s role in the securitisation process Securitisation activity Role played by Westpac Securitisation of Westpac originated assets Arranger Asset originator Bond distributor Facility provider Note holder Trust manager Swap provider Servicer Securitisation in the management of Westpac’s credit portfolio Hedger - protection purchaser Investor - protection seller Investor - purchaser of securitisation exposures 1 The credit exposures of the underlying loans are measured in accordance with APS113.

Pillar 3 report Securitisation 64 | Westpac Group September 2021 Pillar 3 report Provision of securitisation services including funding and arranging asset backed bond issues Arranger Bond distributor Credit enhancement provider Funder Liquidity facility provider Swap counterparty servicer Market maker and broker for distributed bonds Key Objectives Securitisation of Westpac originated assets - The securitisation of Westpac's own assets provides funding diversity, and is a core tool of liquidity management. Securitisation in the management of Westpac’s credit portfolio - Westpac acts as principal in transactions and will buy and sell protection in order to meet its portfolio management objectives. Westpac also purchases securitisation exposures in order to earn income. All securitisation activity must follow Westpac’s credit policies and approval processes. Provision of securitisation services including funding and arranging asset backed bond issues - Westpac receives market-based fees in return for its services as servicer, swap counterparty, arranger and facility provider and program fees, interest margins and bond distribution fees on warehouse and term funding facilities. Westpac facilitates portfolio management activity by its institutional customers by buying and selling securitisation exposures in the secondary market and is compensated through an interest margin and bid-offer spread on the transactions. Structure and organisation Securitisation of Westpac originated assets - Westpac’s Treasury operations are responsible for all Westpac originated securitisation activity including funding, liquidity and capital management. Securitisation in the management of Westpac’s credit portfolio - Westpac’s exposure arising from securitisation, including portfolio hedging, is managed by Westpac Institutional Bank (WIB) and integrated within Westpac’s standard risk reporting and management systems. Provision of securitisation services including funding and arranging asset backed bond issues - These services are provided by WIB and include the provision of liquidity, credit enhancement, funding and derivative facilities, servicer and arranger services, and market-making and broking of asset-backed bonds. Risk reporting Credit exposure - Funding, liquidity, credit enhancement and redraw facilities, swap arrangements and counterparty exposures are captured and monitored in key source systems along with other facilities/derivatives entered into by Westpac. Operational risk exposure - The operational risk review process for Westpac includes the identification of risks, controls and key performance indicators in relation to all securitisation activity and services provided by Westpac or any of its subsidiaries. Market risk exposure - Exposures arising from transactions with the securitisation conduit and other counterparties are captured as part of Westpac’s traded and non-traded market risk reporting and limit management framework. Liquidity risk exposure - Exposure to, and the impact of, securitisation transactions are managed under the Liquidity Risk Management Framework and are integrated into routine reporting for capital and liquidity positions, net interest margin analysis, balance sheet forecasting and funding scenario testing. The annual funding plan incorporates consideration of overall liquidity risk limits and the securitisation of Westpac originated assets. Risk mitigation Securitisation of Westpac originated assets - The interest rate and basis risks generated by Westpac’s hedging arrangements to each securitisation trust are captured and managed within Westpac’s asset and liability management framework. The liquidity risk generated by Westpac’s liquidity and redraw facilities to each securitisation trust is captured and managed in accordance with Westpac’s liquidity management policies along with all other contingent liquidity facilities. Securitisation in the management of Westpac’s credit portfolio - Transactions are approved in accordance with Westpac’s credit risk mitigation approach (see pages 58 and 59).

Pillar 3 report Securitisation Westpac Group September 2021 Pillar 3 report | 65 Provision of securitisation services including funding and arranging asset backed bond issues - All securitisation transactions are approved within the context of a securitisation credit policy that sets detailed transaction-specific guidelines that regulate servicer counterparty risk appetite, transaction tenor, asset class, third party credit support and portfolio quality. This policy is applied in conjunction with other credit and market risk policies that governs the provision of derivative and other services that support securitisation transactions. In particular, credit hedging transactions are subject to Westpac’s credit risk mitigation approach (see pages 58 and 59). Any interest rate or currency hedging is subject to counterparty credit risk management (see pages 60 and 61) and market risk management (see pages 73 and 74) policies and processes. Regulatory capital approaches The regulatory capital treatment of all securitisation exposures is measured in accordance with APS120. APS120 specifies that securitisation exposures held in the trading book are subject to the requirements of Prudential Standard APS 116 Capital Adequacy: Market Risk. Under APS120 the approaches employed include the External Rating Based Approach (ERBA) and the Supervisory Formula Approach (SFA). Under the ERBA, APRA provides risk-weights that are matched to external credit ratings and takes into account tranche maturity and tranche thickness. The SFA applicable to unrated exposures dynamically looks at the type and performance of underlying asset pools funded by the securitisation exposure as well as the structural features of the transaction to determine capital requirements. The Internal Assessment Approach (IAA) is not permitted under APS120. Securitisation of Westpac originated assets - The assets sold by Westpac to a securitisation trust are excluded from Westpac’s calculation of credit risk weighted assets if capital relief is sought and the requirements of APS120 are satisfied1. Westpac cannot rely on external rating when risk weighting its exposure to these trusts and must use the SFA instead. In instances where insufficient risk transfer is achieved by the transaction for regulatory purposes, the capital calculation is performed on the underlying asset pool while the facilities provided to such securitisation vehicles do not attract regulatory capital charges. Securitisation in the management of Westpac’s credit portfolio - Securitisation exposures are assessed using either the ERBA or SFA approaches. Provision of securitisation services including funding - Westpac uses the ERBA and the SFA methodology when determining regulatory capital requirements for warehouse and term funding facilities related to securitised assets on Westpac’s balance sheet. The External Credit Assessment Institutions that can be used by Westpac for securitisations are Standard & Poor’s, Moody’s and Fitch. Westpac’s accounting policies for securitisation activities Securitisation of Westpac originated assets - The assets sold by Westpac to a securitisation trust remain on Westpac’s balance sheet for accounting purposes. Securitisation in the management of Westpac’s credit portfolio - For risk mitigation using synthetic securitisation, the underlying assets remain on Westpac's balance sheet for accounting purposes. The accounting treatment of the assets will depend on their nature. They could include loans and receivables, available for sale securities or derivatives. The most common form of synthetic securitisation is via a credit default swap, which is treated as a derivative and recognised in the profit and loss statement at fair value. For investment in securitisation exposures, if the instrument has been designated on initial recognition at fair value (including instruments containing a credit default swap), the exposure will be measured at fair value through the Income Statement. All other investments in securitisation exposures will be classified as available-for-sale (AFS) and measured at fair value through Other Comprehensive Income (within the AFS securities reserve). Provision of securitisation services including funding and arranging asset backed bond issues - Fee income from these services is recognised on an accrual basis. Liquidity and funding facilities are treated as commitments to provide finance, with fee and margin income recognised on an accrual basis. Warehouse and term funding facilities are treated as loans. 1 Including the requirements to achieve capital relief.

Pillar 3 report Securitisation 66 | Westpac Group September 2021 Pillar 3 report Banking book summary of assets securitised by Westpac This table shows outstanding banking book securitisation assets and assets intended to be securitised12for Westpac originated assets by underlying asset type. It includes the amount of impaired and past due assets, along with any losses recognised by Westpac during the current period. Securitised assets are held in securitisation trusts. Trusts which meet requirements to achieve capital relief do not form part of the Level 2 consolidated group. Self securitisation trusts remain consolidated at Level 2 and the assets transferred to these trusts are risk weighted in accordance with APS113. Assets Westpac 30 September 2021 Traditional Synthetic intended to be Impaired Past due recognised $m Securitisation2 Securitisation securitised loans assets losses Residential mortgages 141,414 - - 41 1,075 - Credit cards - - - - - - Auto and equipment finance 861 - - 13 - - Business lending - - - - - - Investments in ABS - - - - - - Other - - - - - - Total 142,275 - - 54 1,075 - Assets Westpac 31 March 2021 Traditional Synthetic intended to be Impaired Past due recognised $m Securitisation2 Securitisation securitised loans assets losses Residential mortgages 137,681 - - 42 1,068 - Credit cards - - - - - - Auto and equipment finance 1,483 - - 34 - - Business lending - - - - - - Investments in ABS - - - - - - Other - - - - - - Total 139,164 - - 76 1,068 - Assets Westpac 30 September 2020 Traditional Synthetic intended to be Impaired Past due recognised $m Securitisation2 Securitisation securitised loans assets losses Residential mortgages 145,384 - - 56 1,407 - Credit cards - - - - - - Auto and equipment finance 1,735 - - 53 - - Business lending - - - - - - Investments in ABS - - - - - - Other - - - - - - Total 147,119 - - 109 1,407 - Total outstanding securitised by ADI Total outstanding securitised by ADI Total outstanding securitised by ADI Banking book summary of total Westpac sponsored third party assets securitised This table represents banking book third party assets where Westpac acts as a sponsor. $m 30 September 2021 31 March 2021 30 September 2020 Residential mortgages 111 95 113 Credit cards - - - Auto and equipment finance - - - Business lending - - - Investments in ABS - - - Other - - - Total 111 95 113 1 Represents securitisation activity from the end of the reporting period to the disclosure date of this report. 2 Includes self-securitisation assets of $136,266 million as at 30 September 2021 ($131,646 million as at 31 March 2021 and $138,333 million as at 30 September 2020).

Pillar 3 report Securitisation Westpac Group September 2021 Pillar 3 report | 67 Banking book summary of securitisation activity by asset type This table shows assets transferred into securitisation schemes by underlying asset type (ADI originated) for the relevant period. For the 12 months ended 30 September 2021 Amount Recognised gain or $m securitised loss on sale Residential mortgages 35,124 - Credit cards - - Auto and equipment finance 325 - Business lending - - Investments in ABS - - Other - - Total 35,449 - For the 6 months ended 31 March 2021 Amount Recognised gain or $m securitised loss on sale Residential mortgages 9,925 - Credit cards - - Auto and equipment finance 325 - Business lending - - Investments in ABS - - Other - - Total 10,250 - For the 12 months ended 30 September 2020 Amount Recognised gain or $m securitised loss on sale Residential mortgages 76,353 - Credit cards - - Auto and equipment finance 506 - Business lending - - Investments in ABS - - Other - - Total 76,859 -

Pillar 3 report Securitisation 68 | Westpac Group September 2021 Pillar 3 report Banking book summary of on and off-balance sheet securitisation by exposure type 30 September 2021 Off-balance Total Exposure $m Securitisation retained Securitisation purchased sheet at Default Securities - 8,025 38 8,063 Liquidity facilities - - 251 251 Funding facilities 3,870 - 1,466 5,336 Underwriting facilities - - - - Lending facilities 791 - 328 1,119 Warehouse facilities 10,742 - 5,050 15,793 Total 15,404 8,025 7,133 30,561 31 March 2021 Off-balance Total Exposure $m Securitisation retained Securitisation purchased sheet at Default Securities - 7,303 37 7,340 Liquidity facilities - - 273 273 Funding facilities 2,951 - 1,451 4,402 Underwriting facilities - - - - Lending facilities 625 - 540 1,165 Warehouse facilities 9,265 - 5,854 15,119 Total 12,841 7,303 8,155 28,299 30 September 2020 Off-balance Total Exposure $m Securitisation retained Securitisation purchased sheet at Default Securities - 7,650 19 7,669 Liquidity facilities - - 308 308 Funding facilities 2,167 - 1,589 3,756 Underwriting facilities - - - - Lending facilities 551 - 404 956 Warehouse facilities 10,173 - 3,955 14,128 Total 12,892 7,650 6,275 26,817 On balance sheet On balance sheet On balance sheet

Pillar 3 report Securitisation 70 | Westpac Group September 2021 Pillar 3 report Banking book resecuritisation exposure to guarantors Westpac has no third party guarantors providing guarantees for securitised assets, principal or interest repayments as at 30 September 2021 (nil as at 31 March 2021). Trading book summary of assets securitised by Westpac As at 30 September 2021 there was nil in outstanding securitisation exposures for Westpac originated assets held in the trading book (nil as at 31 March 2021). Trading book summary of total Westpac sponsored third party assets securitised There are no third party assets held in the trading book where Westpac is responsible for the establishment of the securitisation program and subsequent management as at 30 September 2021 (nil as at 31 March 2021). Trading book summary of securitisation activity by asset type There is no originated securitisation activity in the trading book for the 12 months to 30 September 2021 (nil for the 6 months to 31 March 2021). Trading book aggregated amount of exposure securitised by Westpac and subject to APS116 Capital Adequacy: Market Risk As at 30 September 2021 there is no Westpac originated outstanding securitisation exposure held in the trading book subject to APS116 Capital Adequacy: Market Risk (nil as at 31 March 2021).

Pillar 3 report Securitisation 72 | Westpac Group September 2021 Pillar 3 report Trading book securitisation exposure deducted from capital There is no trading book capital deduction for 30 September 2021 (nil for 31 March 2021). Trading book securitisation subject to early amortisation treatment There is no securitisation exposure in the trading book that is subject to early amortisation treatment for 30 September 2021 (nil for 31 March 2021). Trading book resecuritisation exposure subject to CRM Westpac has no resecuritisation exposure subject to CRM at 30 September 2021 (nil for 31 March 2021). Trading book resecuritisation by guarantor creditworthiness Westpac has no third party guarantors providing guarantees for securitised assets, principal or interest repayments for 30 September 2021 (nil for 31 March 2021).

Pillar 3 report Market risk Westpac Group September 2021 Pillar 3 report | 73 Westpac’s exposure to market risk arises out of its Financial Markets and Treasury trading activities. This is quantified for regulatory capital purposes using both the standard method and the internal model approach, details of which are provided below. Approach Financial Markets’ trading activity includes dealings that encompass book running and distribution activity. The types of market risk arising from these activities include interest rate, foreign exchange, commodity, equity price, credit spread and volatility risk. Treasury’s trading activity includes the management of interest rate, foreign exchange and credit spread risks associated with the wholesale funding book, liquid asset portfolios and foreign exchange repatriations. Treasury also manages banking book risk which is discussed in the Interest Rate Risk in the Banking Book section. Trading activities are managed within a BRiskC approved market risk framework that incorporates BRiskC approved value at risk (VaR) and stressed value at risk (SVaR) limits. VaR and SVaR are the primary mechanisms for measuring and managing market risk. Market risk is managed using VaR, SVaR and structural risk limits (including volume limits and basis point value limits) in conjunction with scenario analysis and stress testing. Market risk limits are allocated to business management based upon Westpac’s risk appetite and business strategies, in addition to the consideration of market liquidity and concentration risk. Trades are fair valued daily using rates that have been captured from an independent market data source that has been approved by the Revaluation Committee (RC). Where there is no source of independent rates, data will either be derived using a methodology approved by the RC or sourced from dealer contributions. Rates that are dealer-sourced or have limited independent sources are reviewed at least on a monthly basis. The RC meets monthly to review the results of independent price verification performed by the Finance valuation function. In addition, valuation adjustments may be made as deductions from Common Equity Tier 1 Capital for exposures which are not captured through the fair valuation framework. VaR and SVaR limits Market risk arising from trading book activities is primarily measured using VaR based on an historical simulation methodology. Westpac estimates VaR as the potential loss in earnings from adverse market movements and is calculated to a 99% confidence level using the most recent 12 months of historical market data. SVaR is an additional VaR measure which uses 12 months of historical market data that includes a period of significant financial stress. VaR and SVaR take account of all material market variables that may cause a change in the value of the trading portfolio, including interest rates, foreign exchange rates, price changes, volatility, and the correlation between these variables. The BRiskC approved market risk VaR and SVaR limits for trading activities include separate VaR and SVaR sub- limits for the trading activities of Financial Markets and Treasury. Backtesting Daily backtesting of VaR results is performed to ensure that model integrity is maintained. A review of both the actual and potential profit and loss outcomes is also undertaken to monitor any skew created by the historical data. Stress testing Daily stress testing against pre-determined scenarios is carried out to analyse potential losses beyond the 99% confidence level. An escalation framework around selective stress tests is approved by the Head of Market Risk. Profit and loss notification framework The BRiskC has approved a profit and loss notification framework. Included in this framework are levels of escalation in accordance with the size of the profit or loss. Triggers are applied to both a 1-day and a rolling 20- day cumulative total.

Pillar 3 report Market risk 74 | Westpac Group September 2021 Pillar 3 report Risk reporting Daily monitoring of current exposure and limit utilisation is conducted independently by risk managers in the Market Risk and Treasury Risk teams, who monitor market risk exposures against VaR, SVaR and structural limits. Daily VaR and SVaR position reports are produced by risk type, by product lines and by geographic region. These are supplemented by structural risk reporting, advice of profit and loss trigger levels and stress test escalation trigger points. Model accreditation has been granted by APRA for the use of an internal model for the determination of regulatory capital for the key classes of interest rate (general market), foreign exchange, commodity and equity risks (including equity specific risk). Under the model, regulatory capital is derived from both the current VaR window (based upon the most recent 12 months of historical market data) and a SVaR window (12 months of market data that includes a period of significant financial stress), where these VaR measures are calculated over a 10-day time horizon to a 99th percentile, one-tailed confidence interval. Specific risk refers to the variations in individual security prices that cannot be explained by general market movements, and event and default risk. Interest rate specific risk capital (specific issuer risk) is calculated using the Standard method and is added to the VaR regulatory capital measure. Risk mitigation Market risk positions are managed by the trading desks consistent with delegated trading and product authorities. Risks are consolidated into portfolios based on product and risk type. Risk management is carried out by qualified personnel with varying levels of seniority commensurate with the nature and scale of market risks under management. The following controls allow monitoring by management: trading authorities and responsibilities are clearly delineated at all levels; a structured system of limits and reporting of risk exposures, including stress testing; surveillance of dealing room conduct; all new products and significant product variations undergo a rigorous approval process to identify business risks prior to launch; models that are used to determine risk or profit and loss for Westpac’s accounts are independently reviewed; duties are segregated so that employees involved in the origination, processing and valuation of transactions operate under separate reporting lines, minimising the opportunity for collusion; and legal personnel review documentation for compliance with relevant laws and regulations. In addition, Group Audit independently reviews compliance with policies, procedures and limits. Market risk regulatory capital and risk weighted assets The Internal model approach uses VaR and Stressed VaR, while the Standard approach is used for interest rate specific risk. $m 30 September 2021 31 March 2021 30 September 2020 Internal model approach 472 680 630 Standard approach 61 79 71 Total capital required 533 759 701 Risk weighted assets 6,662 9,490 8,761

Pillar 3 report Market risk 76 | Westpac Group September 2021 Pillar 3 report 30 September 2020 $m High Low Average Period end Interest rate risk 76.0 41.0 58.7 42.5 Foreign exchange risk 17.4 1.5 6.3 2.5 Equity risk 0.9 0.1 0.2 0.2 Commodity risk 5.1 0.8 2.4 1.1 Other market risks 19.2 12.2 14.9 12.9 Diversification benefit NA NA (72.5) (10.3) Net market risk1 94.0 40.9 68.6 49.0 For the 6 months ended Back-testing results1 The following graph gives a comparison of actual profit and loss to VaR over the 6 months ended 30 September 2021. Each point on the graph represents 1 day’s trading profit or loss. This result is placed on the graph relative to the associated VaR utilisation. The downward sloping line represents the point where a loss is equal to VaR utilisation. 1 The net market risk measure reflects the aggregate diversified risk position for the period. Therefore, individual risk factors will not sum to this total.

Pillar 3 report Interest Rate Risk in the Banking Book (IRRBB) Westpac Group September 2021 Pillar 3 report | 77 Interest Rate Risk in the Banking Book (IRRBB) is the risk to interest income arising predominately from a mismatch between the duration of assets and liabilities that arises through the course of banking activities. Approach The banking book activities that give rise to market risk include lending activities, balance sheet funding and capital management. Interest rate risk, basis risk, currency risk and funding and liquidity risk are inherent in these activities. Treasury’s Asset & Liability Management (ALM) unit is responsible for managing market risk arising from Westpac’s banking book activity. All material regions, business lines and legal entities are included in Westpac’s IRRBB framework. Model accreditation has been granted by APRA for the use of an internal model for the determination of IRRBB regulatory capital. Under the model, regulatory capital is primarily derived from a VaR measure using 6 years of historical data with a scaled 1 year, 99th percentile, one-tailed confidence interval. Asset and liability management The ALM unit manages the structural interest rate mismatch associated with the transfer priced balance sheet, including the investment of Westpac’s capital to its agreed benchmark duration. A key risk management objective is to achieve reasonable stability of Net Interest Income (NII) over time. These activities are performed under the oversight of ALCO and the Treasury Risk team. Net Interest Income sensitivity NII sensitivity is managed in terms of the net interest income-at-risk (NaR) modelled over a set time horizon using defined scenarios for movements in wholesale market interest rates. The NII measurement framework combines the underlying statement of financial position data with assumptions about runoff and new business, expected repricing behaviour and changes in wholesale market interest rates. The interest rate scenarios modelled include those projected using 100 and 200 basis point shifts up and down from current market yield curves. A comparison between the NII outcomes from these modelled scenarios indicates the sensitivity to interest rate changes. On and off-balance sheet instruments are then used to manage this interest rate risk. NaR limit The BRiskC has approved a NaR limit. This limit is managed by the Group Treasurer and is expressed as a defined basis point shock over a one year risk horizon. This limit is monitored by the Treasury Risk team. VaR limit The BRiskC has also approved an interest rate VaR limit for ALM activities. This limit is managed by the Group Treasurer and monitored by the Treasury Risk team. Additionally, the BRiskC and the Treasury Risk team set structural risk limits to prevent undue concentration of risk. Structural foreign exchange rate risk Structural foreign exchange rate risk results from the generation of foreign currency denominated earnings and from Westpac's capital deployed in offshore branches and subsidiaries, where it is denominated in currencies other than Australian dollars. The Australian dollar equivalent of offshore earnings and capital is subject to change as exchange rates fluctuate, which could introduce significant variability to Westpac's reported financial results. ALCO provides oversight of the appropriateness of foreign exchange hedges on earnings and capital. Risk reporting Interest rate risk in the banking book risk measurement systems include front office product systems, which capture all treasury funding and derivative transactions; the transfer pricing system, which captures all retail and other business transactions; and the asset and liability management risk system, which calculates ALM VaR and NaR. Daily monitoring of market risk exposure against VaR and structural risk limits is conducted independently by the Treasury Risk team, with NaR monitored on a monthly basis. Management reports detailing structural positions and VaR are produced and distributed daily for use by dealers and management across all stakeholder groups. Quarterly reports are produced for the senior management market risk forums of RISKCO and BRiskC to provide transparency of material market risks and issues.

Pillar 3 report Interest Rate Risk in the Banking Book (IRRBB) 78 | Westpac Group September 2021 Pillar 3 report Risk mitigation Market risk arising in the banking book stems from the ordinary course of banking activities, including structural interest rate risk (the mismatch between the duration of assets and liabilities) and capital management. Hedging Westpac’s exposure to interest rate risk is undertaken using derivatives. The hedge accounting strategy adopted utilises a combination of the cash flow, fair value and net investment hedge approaches. Some derivatives held for economic hedging purposes do not meet the criteria for hedge accounting as defined under AASB 139 Financial Instruments: Recognition and Measurement and therefore are accounted for in the same way as derivatives held for trading. The same controls used to monitor traded market risk allow for continuous monitoring by management. Change in economic value of a sudden upward and downward movement in interest rates 30 September 2021 200bp parallel 200bp parallel $m increase decrease AUD 292.1 (309.2) NZD (10.8) 11.5 USD 35.7 (42.5) Total 317.0 (340.2) 31 March 2021 200bp parallel 200bp parallel $m increase decrease AUD (470.2) 511.5 NZD 4.7 (4.2) USD 32.5 (38.8) Total (433.0) 468.5 30 September 2020 200bp parallel 200bp parallel $m increase decrease AUD (290.1) 237.4 NZD (10.0) 12.3 USD 45.8 (54.9) Total (254.3) 194.8 VaR results for non-traded interest rate risk1 For the For the For the 6 months ended 6 months ended 6 months ended 30 September 31 March 30 September $m 2021 2021 2020 High 75.4 224.3 219.7 Low 59.7 69.9 166.9 Average 66.5 190.1 207.0 Period end 63.7 69.9 202.4 Interest rate risk in the banking book regulatory capital and risk weighted assets 30 September 31 March 30 September $m 2021 2021 2020 Total capital required 916 960 730 Risk weighted assets 11,446 11,998 9,124 1 IRRBB VaR includes interest rate risk, credit spread risk in liquid assets and other basis risks as used for internal management reporting purposes.

Pillar 3 report Operational risk Westpac Group September 2021 Pillar 3 report | 79 Operational risk is defined as the risk of loss resulting from inadequate or failed internal processes, people and systems or from external events. This definition includes legal and regulatory risk but excludes strategic risk. Westpac’s operational risk definition is aligned to APS115 Capital Adequacy: Advanced Measurement Approaches to Operational Risk (AMA). Approach Westpac has been accredited to use the AMA in accordance with APS115. Westpac’s operational risk is measured and managed in accordance with the policies and processes defined in its Operational Risk Management Framework. Westpac’s Operational Risk Management Framework The Operational Risk Management Framework outlines our approach to the: identification, measurement and management of operational risks that may impede Westpac’s ability to achieve its strategic objectives and vision; identification and escalation of operational risk incidents to mitigate potential financial loss, regulatory impacts and reputational damage that may impact shareholders, the community, and employees; and calculation of operational risk capital. The key components of Westpac’s operational risk management framework are listed below: Governance - The governance structure provides clearly defined roles and responsibilities for overseeing and reviewing operational risk exposure and its management. The Board and BRiskC are supported by committees, including RISKCO, that monitor the Group’s operational risk profile and the effectiveness of operational risk management practices, including operational risk capital. Risk and Control Assessment (RCA) - The RCA process provides a structured and consistent approach for the Business to develop risk profiles and thereby supports them in implementing appropriate actions where the risk is outside the defined Risk Appetite. Issue and Action Management - The Issue and Action Management process encompasses the identification and management of issues, which relate to control deficiencies or gaps, to ensure that they are effectively addressed through action plans. Key Indicators (KIs) - are objective measures used by management to monitor the current risk and control environment, inform the assessment of risk and to assist in prompting management action when the metrics indicate that the level of risk is increasing. Incident Management – The Incident Management process assists in implementing consistent identification, recording, escalation and rectification of incidents and related losses in a transparent and practical way. This assists the Group to comply with all legal and regulatory obligations and licensing conditions (including reporting material regulatory breaches to regulatory authorities). Data - The framework includes principles and processes to ensure the integrity of operational risk data used to support management decision-making and calculate and allocate capital. The principles apply to the governance, input and capture, reconciliation, and validation, reporting and storage of operational risk data. Operational risk data is subject to independent validation on a regular basis. Scenario Analysis - is used to provide a forward looking-view and facilitate a structured and consistent approach to assess the impacts of severe but plausible loss events on the Group’s objectives and operations. Scenario Analysis is also an input to the calculation of operational risk capital. Reporting - Regular reporting of operational risk information to governance bodies and senior management is used to support timely and proactive management of operational risk and enable transparent and formal oversight of the risk and control environment.

Pillar 3 report Operational risk 80 | Westpac Group September 2021 Pillar 3 report AMA capital model overview Operational risk regulatory capital is calculated on a quarterly basis. Westpac’s operational risk capital is based on three primary data sources: Internal Loss Data – operational risk losses experienced by Westpac; External Loss Data – operational risk losses experienced by other financial institutions; and Scenario Data – potential losses from severe but plausible events relevant to Westpac. These data sources together represent the internal and external operational risk profile, across the spectrum of operational risk losses, from both historical and forward-looking perspectives. The model combines these data sources to produce a loss distribution. Westpac has identified a breach of APS115 requirements related to a failure to review and, as appropriate, incorporate refreshed scenario inputs into its AMA model since August 2017. Westpac has notified APRA, investigated the root cause and has raised an issue to record and track remedial actions. Westpac is satisfied the overall level of Operational risk regulatory capital is adequate, when taking into consideration the significant overlays applied. SMA Capital Overlay Westpac has agreed with APRA in June 2018 to apply an SMA capital overlay to current Advanced Measurement Approach (AMA). The overlay broadly aligns Westpac’s operational risk capital to our estimate of the Standardised Measurement Approach (SMA). The overlay is calculated annually based on year-end financials and treats SMA estimates as a capital floor. The overlay will be maintained until the AMA approach is retired and formally replaced by the SMA. The overlay was estimated for 30 September 2021 to be $765m. Expected loss offsets and risk mitigation No adjustments or deductions are currently made to Westpac’s measurement of operational risk regulatory capital for the mitigating impacts of insurance or expected operational risk losses. Operational Risk regulatory capital and risk weighted assets $m 30 September 2021 31 March 2021 30 September 2020 Model based capital 2,705 2,562 2,562 Standardised approach overlay 765 765 765 Culture, Governance & Accountability Review overlay 500 500 500 AUSTRAC related overlay 500 500 500 Total capital required 4,470 4,327 4,327 Risk weighted assets 55,875 54,090 54,090

Pillar 3 report Equity risk Westpac Group September 2021 Pillar 3 report | 81 Equity risk is defined as the potential for financial loss arising from movements in equity values. The disclosures in this section exclude investments in equities made by Westpac subsidiaries outside the regulatory Level 2 group. Structure and organisation Portfolio and transactional limits for Westpac’s direct equity investments are governed by various supporting policies and delegated approval limits. Where appropriate, the BRiskC (under delegation from the Westpac Board) will consider and approve risks beyond management’s approval authority. Approach Westpac has established a comprehensive set of policies defining the management of equity risk. These policies are reviewed and approved periodically (in most cases annually). Risk mitigation Westpac does not use financial instruments to mitigate its exposure to equities in the banking book. Banking book positions Hybrid equity underwriting and equity warehousing risk - As a financial intermediary Westpac underwrites listed and unlisted hybrid equity securities. Investment securities - Westpac undertakes, as part of the ordinary course of business, certain investments in strategic equity holdings and over time the nature of underlying investments will vary. Measurement of equity securities - Equity securities are generally carried at their fair value. Fair value for equities that have a quoted market price (in an active market) is determined based upon current bid prices. If a market for a financial asset is not active, fair value is determined based upon a valuation technique. This includes the use of recent arms-length transactions, discounted cash flow analysis, option pricing models and other valuation techniques commonly used by market participants to price similar instruments. In the event that the fair value of an unlisted security cannot be measured reliably, these investments are measured at cost. Where the investment is held for long term strategic purposes, these investments are accounted for either at fair value through other comprehensive income (OCI), fair values through profit and loss, or equity accounted for and recognised as a share in associates. Other related matters Fair value should not differ to the listed stock price. Should a listed stock price not be available, fair value is estimated using the valuation techniques referred to above. The book value of certain unlisted investments for which active markets do not exist are measured at cost because cost is considered to be a reasonable approximation of fair value. The equity method of accounting is used for investments in Associates. Associates are entities in which the Group has significant influence, but not control, over the operating and financial policies. Risk reporting Westpac manages equity risk in two ways, VaR limits and investment limits: A VaR limit (in conjunction with structural limits) is used to manage traded equity. This limit is a sub-limit of the overall VaR limit for Financial Markets trading activities. Equity trading activity is overseen by the independent Market Risk function applying the same controls used for monitoring other trading book activities in Financial Markets and Treasury; and Investment exposures are reported annually to MARCO.

Pillar 3 report Equity risk 82 | Westpac Group September 2021 Pillar 3 report Book value of equity exposures 30 September 31 March 30 September $m 2021 2021 2020 Listed equity exposures (publicly traded) 3 40 365 Unlisted equity exposures (privately traded) 160 122 127 Total book value of equity exposures 163 162 492 Gains/losses 30 September 31 March 30 September $m 2021 2021 2020 Cumulative realised gains (losses) - 32 47 Total unrealised gains (losses) through profit & loss 5 - 303 Total unrealised gains (losses) through equity - - - Total latent revaluation gains (losses) - - -

Pillar 3 report Funding and liquidity risk management Westpac Group September 2021 Pillar 3 report | 83 Funding and liquidity risk is the risk that Westpac cannot meet its payment obligations or that it does not have the appropriate amount, tenor and composition of funding and liquidity to support its assets. Approach Funding and liquidity risk is measured and managed in accordance with the policies and processes defined in the Board-approved Liquidity Risk Management Framework which is part of the Westpac Board-approved Risk Management Strategy. Responsibility for managing Westpac’s liquidity and funding positions in accordance with the Liquidity Risk Management Framework is delegated to Treasury, under the oversight of Group ALCO and Treasury Risk. Liquidity Risk Management Framework The Liquidity Risk Management Framework sets out Westpac’s funding and liquidity risk appetite, roles and responsibilities of key people managing funding and liquidity risk within Westpac, risk reporting and control processes and limits and targets used to manage Westpac’s balance sheet. Key components of Westpac’s approach to liquidity risk management are listed below. Funding strategy Treasury undertakes an annual funding review that outlines Westpac’s balance sheet funding strategy over a three year period. This review encompasses trends in global markets, peer analysis, wholesale funding capacity, expected funding requirements and a funding risk analysis. This strategy is continuously reviewed to take account of changing market conditions, investor sentiment and estimations of asset and liability growth rates. Westpac monitors the composition and stability of its funding so that it remains within its funding risk appetite. This includes compliance with both the LCR and NSFR. Liquid asset holdings Westpac holds a portfolio of liquid assets for several purposes, including as a buffer against unforeseen funding requirements. The level of liquid assets held takes into account the liquidity requirements of Westpac’s balance sheet under normal and stress conditions. Liquidity modelling In managing liquidity for Westpac, Treasury utilises balance sheet forecasts and the maturity profile of Westpac’s wholesale funding portfolio to project liquidity outcomes. Local liquidity limits are also used by Westpac in applicable jurisdictions to ensure liquidity is managed efficiently and prudently. In addition, Westpac conducts regular stress testing to assess its ability to meet cash flow obligations under a range of market conditions and scenarios. These scenarios inform liquidity limits and strategic planning. Liquidity transfer pricing Westpac has a liquidity transfer pricing framework which allocates liquidity costs across Westpac. Contingency planning Treasury maintains a contingent funding plan that outlines the steps that should be taken by Westpac in the event of an emerging ‘funding crisis’. The plan is aligned with Westpac’s broader Liquidity Crisis Management Policy which is approved annually by the Board. Liquidity reporting Daily liquidity risk reports are reviewed by the Group’s Treasury and Treasury Risk teams. Liquidity reports are presented to ALCO monthly and to the Board quarterly. Committed Liquidity Facility In September 2021, APRA announced it expects Authorised Deposit-taking Institutions (ADIs) subject to the LCR to reduce their Committed Liquidity Facility (CLF) usage to zero by the end of 2022, subject to financial market conditions. The reduction is expected to occur in stages, with the first reduction scheduled for 1 January 2022. As a result, Westpac’s current CLF allocation is expected to be replaced by additional High Quality Liquid Assets (HQLA) over 2022.

Pillar 3 report Remuneration Westpac Group September 2021 Pillar 3 report | 87 Employees subject to the remuneration disclosure requirements under APS 330 Attachment G are: Senior managers1: There are 35 employees identified by the Westpac Group Fit & Proper Policy as responsible persons. These employees include the most senior executives of Westpac and other senior employees with particular management responsibilities as set out under paragraph 25 of APRA Prudential Standard CPS 520 Fit and Proper; and Material risk takers: In addition to the senior managers, there are 7 employees who have been assessed as having the ability to affect the financial soundness of Westpac as an Authorised Deposit-taking Institution. These are employees with senior accountability and authority who can influence key risks. Qualitative disclosures Westpac Group Remuneration Policy The Group Remuneration Policy sets out the mandatory requirements to be reflected in the design and management of remuneration arrangements across Westpac. Westpac’s purpose is to help Australians and New Zealanders succeed. The policy supports Westpac’s purpose by requiring the design and management of remuneration to align with stakeholder interests, support long-term financial soundness and encourage prudent risk management. The policy applies to all legal entities, business units and employees of Westpac and its related bodies corporate2 (except temporary and casual employees). The policy is reviewed by the Board Remuneration Committee (BRC) on a regular basis. The policy was last approved by the Westpac Board in October 2020 with amendments made to strengthen references to regulatory requirements, remove operational elements and reflect Westpac’s refreshed Purpose, Values and Behaviours. The policy was also updated and reviewed by the BRC in September 2021 with clarifications made to the definitions of responsible persons and material risk takers as well as updated references to related policies and practices. Reward strategy and 2021 framework Westpac’s remuneration strategy is designed to attract and retain talented employees by rewarding them for achieving high performance and delivering superior long-term results for our customers and shareholders, while adhering to sound risk management and governance principles. Senior managers and material risk takers are rewarded based on a total reward framework which is designed to: align remuneration with customer and shareholder interests; support an appropriate risk culture and employee conduct; differentiate pay for behaviour and performance in line with our purpose and strategy; provide market competitive and fair remuneration; enable recruitment and retention of talented employees; provide the ability to risk-adjust remuneration; and be simple, flexible and transparent. For senior managers and material risk takers at or above the General Manager level, the total reward framework has three components: fixed remuneration, Short Term Variable Reward (STVR) and Long Term Variable Reward (LTVR) as outlined in the table below. The total reward framework is benchmarked against other financial services companies both in Australia and internationally as relevant. 1 The senior manager definition utilised in these disclosures reflects the APRA reference to “responsible person” under paragraph 57(a) of Prudential Standard CPS 510 Governance. The Westpac equivalent is the CEO, Group Executives and certain General Managers designated as responsible persons in the Authorised Deposit-taking Institution. 2 This policy does not extend to any related bodies corporate which are separately listed on the Australian Securities Exchange.

Pillar 3 report Remuneration 88 | Westpac Group September 2021 Pillar 3 report Fixed remuneration Variable reward STVR LTVR Purpose Attract and retain high quality employees. Ensure a portion of remuneration is variable, at- risk and linked to the delivery of agreed plan targets for financial and non-financial measures that support Westpac’s strategic priorities. Align accountability and remuneration with the long-term interests of shareholders. Delivery Fixed remuneration comprises cash salary, salary sacrificed items, and employer superannuation contributions. STVR is awarded in cash and restricted shares1 based on an assessment of performance over the preceding year. Performance is assessed against a balanced scorecard comprising: a values and behaviours assessment against Westpac's values; financial and non-financial measures linked to the Group’s strategic priorities; and a modifier to support adjustment of the outcome, upwards or downwards (including to zero), for risk and reputation matters, people management matters and any other matters as determined by the Board. Restricted shares vest in portions reflecting the scope and nature of an individual’s role and responsibility, subject to continued service and adjustment. The maximum STVR opportunity for these employees is capped. LTVR comprises: for Group Executives, performance share rights which vest after four years subject to the achievement of a relative Total Shareholder Return (TSR) performance hurdle, continued service and adjustment; and for General Managers, restricted shares or share rights without performance hurdles which vest after four years, subject to continued service and adjustment. Eligible employees may receive an annual award of Westpac ordinary shares up to the value of $1,000 under the Employee Share Plan. Employees who received an equity award during the year, for example, as deferred STVR or LTVR, are not eligible to receive an Employee Share Plan award for that year. The target mix of fixed and variable reward varies across employees and groups of employees. Factors that can influence the mix include the role type, regulatory requirement of the role, level of responsibility of the individual, market benchmarks and performance. Fixed remuneration Fixed remuneration is aligned to the market and reviewed annually. It takes into account the size, responsibilities and complexity of the role, as well as the skills and experience of the employee. Fixed remuneration comprises: cash salary; salary sacrificed items; and superannuation or superannuation equivalent contributions for employees in Australia, New Zealand and some other countries in which we operate. Variable reward Variable reward is designed to: encourage employee conduct aligned to customer interests; support Westpac’s long term financial soundness and risk management framework; align remuneration with prudent risk-taking and allow for adjustments to reflect the outcomes of business activities, the risks related to business activities (taking account of the cost of the associated capital, where relevant) and the time necessary for outcomes to be reliably measured; allow for an adjustment by an amount that is proportionate to the failure of an Accountable Person2 to comply with their accountability obligations under the Banking Executive Accountability Regime; and reflect Australian and international regulatory requirements. 1 Deferred STVR is awarded in unhurdled share rights to some employees outside Australia. 2 As defined in the Banking Act 1959 excluding Non-executive Directors.

Pillar 3 report Remuneration Westpac Group September 2021 Pillar 3 report | 89 There are two forms of variable reward: Short Term Variable Reward Performance is measured against risk-adjusted financial and non-financial measures that support the Group's strategy to determine the size of the award. STVR is awarded in cash and, if STVR is above the deferral thresholds, a portion of the STVR is allocated as restricted shares or unhurdled share rights. Information on the deferral framework is set out in the table below. Long Term Variable Reward The CEO and Group Executives receive annual LTVR awards in the form of performance share rights which vest after four years subject to the achievement of a performance hurdle, continued service and adjustment. The CEO and Group Executives only receive value from their LTVR awards where vesting occurs. The performance hurdle for the grants of performance share rights allocated in December 2020 is relative TSR. A performance share right is not a Westpac share and does not attract the payment of dividends. Senior managers and material risk takers at the General Manager level receive annual LTVR awards in the form of restricted shares under the Restricted Share Plan or unhurdled share rights under the Westpac Performance Plan. The size of the award is set with reference to market benchmarks, individual performance over time, succession potential and key skills. Employees are required to comply with risk management and compliance requirements as they apply to their particular role and business. Failure to meet these requirements will impact remuneration, including eligibility for a fixed pay adjustment and variable reward participation. Deferral All employees who receive an STVR award above a certain threshold have a portion of the award deferred. Deferral arrangements depend on the value of the award and the level and type of role. The table below sets out the variable reward deferral arrangements for senior managers and material risk takers. Role Type Deferral Arrangement1 CEO and Group Executives 50% of any STVR is deferred equally over two years General Managers 40% of any STVR is deferred equally over two years General Managers in Westpac Institutional Bank and Treasury 40% of any STVR is deferred for four years 50% deferral for portion of allocation above $500,000, vesting in full after four years Westpac Institutional Bank and Treasury employees 25% deferral where STVR allocation is $150,000 or greater, vesting equally over three years 50% deferral for portion of allocation above $500,000, vesting equally over three years 70% deferral for portion of allocation above $2,000,000, vesting equally over three years Other employees 25% deferral where STVR allocation is $150,000 or greater, vesting equally over two years 50% deferral for portion of allocation above $500,000, vesting equally over two years 70% deferral for portion of allocation above $2,000,000, vesting equally over two years STVR deferral periods are set within the context of the market and the overall Group risk profile. The STVR deferral period for employees in Westpac Institutional Bank and Treasury is longer than the rest of the Group. STVR is deferred into equity in the form of restricted Westpac ordinary shares (for most employees) or Westpac share rights (for some employees outside Australia). By deferring a portion of the STVR as restricted equity, STVR awards are better aligned with the interests of shareholders as the value of the deferred portion is tied to the share price at the end of the restriction period. The deferral framework provides the ability to reduce unvested STVR, including to zero, if: having regard to circumstances or information which has come to light after the grant of the award, all or part of the initial award was not justified; necessary to protect the financial soundness of Westpac or to respond to significant unexpected or unintended consequences that were not foreseen; and/or an accountable person has failed to comply with their accountability obligations under the Banking Executive Accountability Regime. 1 Thresholds shown in dollars apply to Australia and New Zealand.

Pillar 3 report Remuneration 90 | Westpac Group September 2021 Pillar 3 report Remuneration governance The Group Remuneration Policy is supported by an established governance structure, plans and frameworks that are designed to support remuneration decision-making across the Group. Board The Board provides strategic guidance for the Group and has oversight of management’s implementation of Westpac’s strategic initiatives. The Board has overall accountability for reviewing and approving remuneration for select groups of employees. Without limiting its role, the Board approves (following recommendation from the Board Remuneration Committee, where applicable): corporate goals and objectives relevant to the remuneration of the CEO; the size of the variable reward pool; adjustments to variable reward (including forfeiture and clawback) in accordance with the Group Remuneration Policy; and remuneration (including variable reward targets and performance outcomes) for the CEO, Group Executives, other executives who report directly to the CEO, any other accountable persons under the Banking Executive Accountability Regime, other persons whose activities in the Board’s opinion affect the financial soundness of the Group, any other person specified by APRA and any other person the Board determines. The Board has the discretion to defer, adjust or withdraw aggregate and individual variable reward. Further detail is contained in the Board and Committee Charters which are available on Westpac’s website. Board Remuneration Committee The Board Remuneration Committee assists the Board to discharge its responsibility by overseeing remuneration policies and practices of Westpac and its related bodies corporate in the context that these policies and practices fairly and responsibly reward individuals having regard to performance, and reflect Westpac’s risk management framework, the law and the highest standard of governance. The Board Remuneration Committee reviews and makes recommendations to the Board in relation to: the Group Remuneration Policy; remuneration arrangements for the individuals and groups outlined above; the remuneration structures for each category of persons covered by the Group Remuneration Policy; corporate goals and objectives relevant to the remuneration of the CEO; STVR and LTVR plans and outcomes and adjustments (including forfeiture and clawback) for the Group Executives, any other accountable persons under the Banking Executive Accountability Regime and any other person the Board determines; and approving any equity-based plans. In carrying out its duties, the Board Remuneration Committee accesses risk and financial control personnel and engages external advisers who are independent of management. Members of the Board Remuneration Committee are independent Non-executive Directors. Further detail is contained in the Board Remuneration Committee Charter which is available on Westpac’s website. There were eight Board Remuneration Committee meetings held during the financial year ended 30 September 2021 (FY21). The FY21 Board Remuneration Committee Chairman fee was $63,800 and the FY21 base fee for Board Remuneration Committee members was $29,000. Interaction with other Board Committees Management remuneration oversight committees Members of the Board Remuneration Committee are all members of either the Board Risk Committee or the Board Legal, Regulatory & Compliance Committee. The cross membership of those Committees supports alignment between risk and reward. The Board Remuneration Committee seeks feedback from and considers matters raised by other Board Committees with respect to remuneration outcomes, adjustments to remuneration in light of relevant matters and alignment of remuneration with the risk management framework. Divisional remuneration oversight committees consider areas of risk and consider potential implications for remuneration. These committees report to the Group Remuneration Oversight Committee which in turn considers consistency of remuneration across the Group and provides information to the Board Remuneration Committee and Board for review and decision- making as appropriate. During the financial year, remuneration governance arrangements were reviewed and minor changes were made to enhance the Terms of Reference for the Group Remuneration Oversight Committee. Remuneration consultants In 2021, the Board retained Guerdon Associates to provide specialist information on executive remuneration and other remuneration matters. The services were provided directly to the Board Remuneration Committee independent of management. The Chairman of the Board Remuneration Committee oversees the engagement and associated costs. Work undertaken by Guerdon Associates during 2021 included the provision of information relating to the benchmarking of Non-executive Director, CEO and Group Executive remuneration. In 2021, no remuneration recommendations, as prescribed under the Corporations Act 2001 (Cth) (Corporations Act), were made by Board advisors. Independence of risk and financial control employees The remuneration structure for risk and financial control employees is designed to support independence and avoid conflicts of interest. The remuneration mix for risk and financial control employees generally consists of a higher proportion of fixed pay to variable reward. In addition, the Group follows a process of ‘two-up’ approval for all remuneration decisions. This means that

Pillar 3 report Remuneration Westpac Group September 2021 Pillar 3 report | 91 remuneration is approved by the next most senior person above the employee’s manager. This approach is also reflected in our requirement for the Board, based on recommendations from the Board Remuneration Committee, to approve performance outcomes and remuneration for specified groups including the CEO and Group Executives and other persons whose activities in the Board’s opinion may affect the financial soundness of the Group and any other person specified by APRA. Remuneration and risk Westpac’s remuneration strategy, total reward framework, policies and practices reflect the sound risk management that is fundamental to the way the Group operates. Westpac integrates risk management into remuneration by designing and managing arrangements in a manner that encourages behaviour that supports our long term financial soundness and risk management framework. The performance of the Group and each division is reviewed and measured with reference to how risk is managed in line with Westpac’s Risk Appetite Statement and the results influence remuneration outcomes. The key risks that are considered include strategic risk, risk culture, operational risk, compliance and conduct, financial crime, cyber risk, reputational and sustainability risk, capital adequacy, funding and liquidity risk, credit risk and market risk. In addition, STVR outcomes are influenced by relevant risk-related measures as well as matters through the Board’s application of the scorecard modifier, which is informed by risk and compliance input independent of the business or functional area. The deferral framework provides consistency across the Group and enhances our remuneration framework from a risk management perspective. The deferral framework provides the Board with the ability to adjust all forms of unvested deferred variable reward downwards, including to zero, if having regard to circumstances or information which has come to light after the grant of the deferred equity or cash, all or part of the initial award was not justified. In addition, failure to meet mandatory risk management and compliance requirements impacts eligibility for a fixed pay adjustment and variable reward participation, and may result in disciplinary action and/or termination of employment. Remuneration adjustments for prior period matters The Board may adjust all forms of unvested deferred variable reward downward, including to zero, for matters arising from a prior period if circumstances or information come to light which mean that in the Board’s view all or part of the award was not appropriate. Having decided that a downward adjustment is appropriate and determined the amount of any adjustment, typically the Board will first apply that adjustment against the STVR for the current performance period. In instances where an adjustment to current year STVR is insufficient or unavailable, the Board may apply the adjustment to unvested deferred variable reward. Clawback provides an additional mechanism to recover vested deferred variable reward in certain limited circumstances for awards made in respect of performance periods commencing on or after 1 October 2019. It is the Board’s current intention that clawback will only be considered for relevant conduct that occurred on or after 1 October 2019. Variable reward pool The Board determines the size of the variable reward pool each year. This is based on the Group’s performance for the year and an assessment of how profit should be shared between shareholders and employees while retaining sufficient capital for growth. A broad range of non-financial measures including customer outcomes, talent retention and market competitiveness are considered when determining the pool. Scorecards STVR awards are determined with reference to an assessment of performance. For FY21, the CEO, Group Executives and General Managers performance was assessed against a scorecard split into three sections. Values and behaviours assessment: Consideration of the degree to which individuals have demonstrated Westpac's values of 'Helpful, Ethical, Leading change, Performing and Simple'. Focus areas: Consideration of financial and non-financial measures aligned to Westpac’s key strategic priorities to support an initial scorecard result. In assessing outcomes for each focus area, a number of factors are taken into account. For example: o matters not known or not relevant at the beginning of the performance period which are relevant to the under or over performance of the employee over the performance period; o the degree of difficulty associated with achieving the targets that had been set in the scorecard (and the context of those targets);

Pillar 3 report Remuneration 92 | Westpac Group September 2021 Pillar 3 report o whether the budgetary assumptions that were present when performance targets were set remain correct (and the current financial environment compared with those assumptions); and o comparisons with the performance of Westpac’s main competitors having regard to major shareholder and customer benchmarks as well as the composition and/or consistency of financial result performance. Modifier: Consideration of significant matters not fully reflected in the focus areas, including risk and reputation matters, people management matters, and any other matters as determined by the Board, to support the adjustment of the overall scorecard result, upwards or downwards (including to zero). The table below sets out the focus areas of the Group scorecard for FY21 which forms part of the CEO scorecard. Category Weighting Examples of measures1 Fix 30% Delivery of the Customer Outcomes and Risk Excellence (CORE) Integrated Plan measured by committed activities and associated outcomes. Simplify 20% Exit of non-core businesses and consolidating international operations Embedding the Lines of Business operating model Using data and technology to transform the customer experience Reducing systems and technology complexity Perform 50% Enhancing financial returns and optimising capital Growth in key markets Resetting the cost base Providing market leading customer service Westpac’s strategic priorities are cascaded from the CEO’s scorecard to the scorecards of senior managers and material risk takers in combination with other divisional or functional measures which support the Group’s strategic short and long term goals. Weightings and measures reflect variations in roles. The performance measures and weightings within the CEO scorecard were updated to reflect the Group’s strategic priorities of ‘Fix. Simplify. Perform’. This included embedding the requirements of the Enforceable Undertaking by placing a weighting of 30% for the delivery of the Customer Outcomes and Risk Excellence (CORE) Integrated Plan. The impact of these changes on remuneration outcomes was informed by Group and individual performance in these areas. Scorecard focus areas for senior managers and material risk takers are consistent with that of the CEO’s: Performance measures such as Westpac Group and divisional cash earnings, return on tangible equity, core earnings growth, expense to income and expense management accounted for up to 45% of senior managers’ scorecards. The CEO and each senior manager are assessed on specific risk measures that may influence any discretionary adjustment to the scorecard. Scorecards for material risk takers at the General Manager level may also include risk measures related to financial risk and balance sheet management with non financial risk included in the modifier section of the scorecard. Metrics include the common equity tier 1 ratio, the net stable funding ratio and the liquidity coverage ratio. Senior Managers and material risk takers below the General Manager level have goals and objectives that are set in agreement with their manager with no standardised percentage weightings. 1 Individual measures will differ for each senior manager.

Pillar 3 report Appendix I | Regulatory capital reconciliation Westpac Group September 2021 Pillar 3 report | 95 $m 30 September 2021 Capital Disclosure Template Reference Table a Deferred Tax Assets Total Deferred Tax Assets per level 2 Regulatory Balance Sheet 2,429 Add: Held for sale deferred tax assets (per Level 2) - Deferred tax asset adjustment before applying prescribed thresholds 2,429 Row 26e Less: Amounts below prescribed threshold - risk weighted (2,429) Row 75 Total per Capital Disclosure Template - Deferred Tax Asset - Row 21 / 25 $m 30 September 2021 Capital Disclosure Template Reference Table b Goodwill and other intangible assets Total Goodwill and Intangibles Assets per level 2 Regulatory Balance Sheet 10,109 Less: Capitalised Software Disclosed Under Intangibles (1,840) Row 9 Total per Capital Disclosure Template - Goodwill 8,269 Row 8 $m 30 September 2021 Capital Disclosure Template Reference Table c Equity Investments Significant Investment in financial entities 31 Equity Investments in non-consolidated subsidiaries 2,044 Total Significant Investment in financial entities 2,075 Row 73 Non-significant Investment in financial entities 102 Row 72 Total Investments in financial institutions 2,177 Row 26d Investment in commercial entities 30 Row 26g Total Equity Investments before applying prescribed threshold 2,207 Less: Amounts below prescribed threshold (2,207) Total per Capital Disclosure Template - Equity Investments - Row 18/ 19/ 23 $m 30 September 2021 Capital Disclosure Template Reference Table d Additional Tier 1 Capital Total Loan Capital per Level 2 Regulatory Balance Sheet 29,067 Less: Tier 2 Capital Instruments Reported Below (18,851) Add: Capitalised Issue Costs for Additional Tier 1 Capital Instruments1 54 Less: Fair Value Adjustment2 (90) Total per Capital Disclosure Template - Tier 1 Capital 10,180 Row 36 Additional Tier 1 Capital included in Regulatory Capital Westpac Capital Notes 2 1,311 Westpac Capital Notes 4 550 Westpac Capital Notes 5 1,690 Westpac Capital Notes 6 1,423 SEC Registered Capital Securities 1,733 Westpac Capital Notes 7 1,723 Westpac Capital Notes 8 1,750 Total Basel III complying instruments 10,180 Row 30 Total Basel III non complying instruments - Row 33 Total per Capital Disclosure Template - Additional Tier 1 Capital Instruments 10,180 Row 36 12 1 Unamortised issue costs relating to capital instruments are netted off against each instrument in the Balance Sheet. For regulatory capital purposes, these capital instruments are shown gross of unamortised issue costs. The unamortised issue costs are deducted from CET1 as part of capitalised expenses in Row 26f in the capital disclosure template. 2 For regulatory capital purposes, APRA requires these instruments to be included as if they were unhedged.

Pillar 3 report Appendix I | Regulatory capital reconciliation 96 | Westpac Group September 2021 Pillar 3 report $m 30 September 2021 Capital Disclosure Template Reference Table e Tier 2 Capital Total Tier 2 Capital per Level 2 Regulatory Balance Sheet 18,851 Add: Capitalised Issue Costs for Tier 2 Capital Instruments1 43 Less: Fair Value Adjustment2 (179) Less: Cumulative amortisation of Tier 2 Capital Instruments - Less: Basel III transitional adjustment - Row 56c Provisions 51 Row 50 / 76 Total per Capital Disclosure Template - Tier 2 18,766 Row 51 Tier 2 Capital included in Regulatory Capital AUD350 million Westpac Subordinated Notes 350 SDG325 million Westpac Subordinated Notes 331 USD100 million Westpac Subordinated Notes 138 JPY20,000 million Westpac Subordinated Notes 248 JPY10,200 million Westpac Subordinated Notes 127 JPY10,000 million Westpac Subordinated Notes 124 AUD175 million Westpac Subordinated Notes 175 USD1,500 million Westpac Subordinated Notes 2,077 JPY8,000 million Westpac Subordinated Notes 99 JPY13,500 million Westpac Subordinated Notes 167 JPY12,000 million Westpac Subordinated Notes 149 HKD 600 million Westpac Subordinated Notes 107 AUD350 million Westpac Subordinated Notes 350 AUD185 million Westpac Subordinated Notes 185 AUD250 million Westpac Subordinated Notes 250 AUD130 million Westpac Subordinated Notes 130 AUD725 million Westpac Subordinated Notes II 725 USD1,000 million Westpac Subordinated Notes 1,380 USD1,250 million Westpac Subordinated Notes 1,730 AUD1,000 million Westpac Subordinated Notes 1,000 USD1,500 million Westpac Subordinated Notes 2,077 USD1,000 million Westpac Subordinated Notes 1,380 USD1,500 million Westpac Subordinated Notes 2,075 AUD1,250 million Westpac Subordinated Notes 1,250 EUR1,000 million Westpac Subordinated Notes 1,604 Total Basel III complying instruments 18,228 Row 46 USD352 million Perpetual Floating Rate Notes 487 Total Basel III non complying instruments 487 Less: Basel III transitional adjustment - Row 85 Total Basel III non complying instruments after transitional adjustment 487 Row 47 Provisions 51 Row 50 / 76 Total per Capital Disclosure Template - Tier 2 Capital Instruments 18,766 Row 51 $m 30 September 2021 Capital Disclosure Template Reference Table f Treasury Shares and RSP Treasury Shares Total treasury shares per Level 2 Regulatory Balance Sheet (606) Less: Treasury Shares not included for Level 2 Regulatory Capital (57) Total per Capital Disclosure Template - Treasury Shares (663) Row 26a $m 30 September 2021 Capital Disclosure Template Reference Table g Accumulated Other Comprehensive Income (and other reserves) Total reserves per Level 2 Regulatory Balance Sheet 2,138 Less: Share Based Payment Reserve not included within capital (53) Total per Capital Disclosure Template - Accumulated Other Comprehensive Income (and other reserves) 2,085 Row 3 1 1 For regulatory capital purposes, APRA requires these instruments to be included as if they were unhedged.

Pillar 3 report Appendix I | Regulatory capital reconciliation Westpac Group September 2021 Pillar 3 report | 99 $m 30 September 2021 Table Reference Capital ratios and buffers 61 Common Equity Tier 1 (as a percentage of risk-weighted assets) 12.3% 62 Tier 1 (as a percentage of risk-weighted assets) 14.6% 63 Total capital (as a percentage of risk-weighted assets) 18.9% 64 Buffer requirement (minimum CET1 requirement of 4.5% plus capital conservation buffer of 2.5% plus any countercyclical buffer requirements expressed as a percentage of risk-weighted assets)1 8.0% 65 of which: capital conservation buffer requirement1 3.5% 66 of which: ADI-specific countercyclical buffer requirements 0.0% 67 of which: G-SIB buffer requirement (not applicable) NA 68 Common Equity Tier 1 available to meet buffers (as a percentage of risk-weighted assets) 12.3% National minima (if different from Basel III) 69 National Common Equity Tier 1 minimum ratio (if different from Basel III minimum) 4.5% 70 National Tier 1 minimum ratio (if different from Basel III minimum) 6.0% 71 National total capital minimum ratio (if different from Basel III minimum) 8.0% Amount below thresholds for deductions (not risk-weighted) 72 Non-significant investments in the capital of other financial entities 102 Table c 73 Significant investments in the ordinary shares of financial entities 2,075 Table c 74 Mortgage servicing rights (net of related tax liability) - 75 Deferred tax assets arising from temporary differences (net of related tax liability) 2,429 Table a Applicable caps on the inclusion of provisions in Tier 2 76 Provisions eligible for inclusion in Tier 2 in respect of exposures subject to standardised approach (prior to application of cap) 51 Table e 77 Cap on inclusion of provisions in Tier 2 under standardised approach 177 78 Provisions eligible for inclusion in Tier 2 in respect of exposures subject to internal ratings-based approach (prior to application of cap) - Table e 79 Cap for inclusion of provisions in Tier 2 under internal ratings-based approach 2,022 Capital instruments subject to phase-out arrangements (only applicable between 1 Jan 2018 and 1 Jan 2022) 80 Current cap on CET1 instruments subject to phase out arrangements NA 81 Amount excluded from CET1 due to cap (excess over cap after redemptions and maturities) NA 82 Current cap on AT1 instruments subject to phase out arrangements 557 83 Amount excluded from AT1 instruments due to cap (excess over cap after redemptions and maturities) - 84 Current cap on T2 instruments subject to phase out arrangements 569 85 Amount excluded from T2 due to cap (excess over cap after redemptions and maturities) - Table e Countercyclical buffer12 The table below details Westpac’s countercyclical buffer requirement. Exposure at default Risk Weighted Assets2 Jurisdictional buffer ADI-specific buffer Hong Kong 1,150 504 1.000% 0.00140% Luxembourg 2 1 0.500% 0.00000% Norway 1 1 1.000% 0.00000% Other 1,132,930 359,765 0.000% 0.00000% Total 1,134,083 360,270 0.00140% Total Risk Weighted Assets 436,650 Countercyclical capital buffer 6 1 Includes 1% Domestic Systemically Important Bank (D-SIB) requirement. 2 Represents total private sector (excludes Banks and Sovereigns) credit and specific market risk weighted assets.

Pillar 3 report Appendix II | Entities included in regulatory consolidation 100 | Westpac Group September 2021 Pillar 3 report This appendix lists all subsidiaries controlled by Westpac according to their level of regulatory consolidation. Level 1 Entities The following controlled entities have been approved by APRA for inclusion in the Westpac ADI’s ‘Extended Licensed Entity’ (ELE) for the purposes of measuring capital adequacy at Level 1: Westpac Banking Corporation Westpac Capital-NZ-Limited 1925 (Commercial) Pty Limited Westpac Debt Securities Pty Limited 1925 (Industrial) Pty Limited Westpac Direct Equity Investments Pty Limited Belliston Pty Limited Westpac Equity Investments NZ Limited Bill Acceptance Corporation Pty Limited Westpac Finance (HK) Limited Capital Finance Australia Limited Westpac Financial Holdings Pty Limited CBA Pty Limited Westpac Group Investment-NZ-Limited Challenge Limited Westpac Holdings-NZ-Limited Mortgage Management Pty Limited Westpac Investment Capital Corporation Partnership Pacific Pty Limited Westpac Investment Vehicle No.2 Pty Limited Partnership Pacific Securities Pty Limited Westpac Investment Vehicle Pty Limited Pashley Investments Pty Limited Westpac Leasing Nominees-Vic.-Pty Limited Sallmoor Pty Limited Westpac New Zealand Group Limited Sixty Martin Place (Holdings) Pty Limited Westpac Overseas Holdings No. 2 Pty Limited St.George Business Finance Pty Limited Westpac Overseas Holdings Pty Limited St.George Equity Finance Limited Westpac Properties Limited St.George Finance Holdings Limited Westpac Securitisation Holdings Pty Limited St.George Security Holdings Pty Limited Westpac Structured Products Limited Value Nominees Pty Limited Westpac TPS Trust Westpac Administration 2 Pty Limited Westpac Unit Trust Westpac Administration Pty Limited Westpac USA Inc. Westpac Americas Inc. Level 2 Entities The following controlled entities are included in the Level 2 consolidation (along with the ELE entities) for the purposes of measuring capital adequacy: 1925 Advances Pty Limited Capital Fleetlease Pty Limited Altitude Administration Pty Limited Capital Motor Finance Pty Limited Altitude Rewards Pty Limited Capital Rent Group Pty Limited Aotearoa Financial Services Limited Crusade ABS Series 2017-1P Trust BT (Queensland) Pty Limited Crusade ABS Series 2018-1P Trust BT Australia Pty Limited Crusade Trust No.2P of 2008 BT Financial Group (NZ) Limited Danaby Pty Limited BT Financial Group Pty Limited General Credits Pty Limited BT Securities Limited Hastings Management Pty Limited Capital Corporate Finance Pty Limited Net Nominees Limited Capital Finance (NZ) Pty Limited Number 120 Limited

Pillar 3 report Appendix II | Entities included in regulatory consolidation Westpac Group September 2021 Pillar 3 report | 101 Level 2 Entities (Continued) Qvalent Pty Limited Westpac Capital Markets LLC RAMS Financial Group Pty Limited Westpac Cash PIE Fund RMS Warehouse Trust 2007-1 Westpac Covered Bond Trust Series 2008-1M WST Trust Westpac Digital Partnerships Pty Ltd Series 2012-1 WST Trust Westpac Equity Holdings Pty Limited Series 2013-1 WST Trust Westpac Europe GmbH Series 2013-2 WST Trust Westpac Europe Limited Series 2014-1 WST Trust Westpac Financial Consultants Pty Limited Series 2014-2 WST Trust Westpac Financial Services Group Limited Series 2015-1 WST Trust Westpac Financial Services Group-NZ-Limited Series 2019-1 WST Trust Westpac Global Capital Markets Pty Limited Series 2020-1 WST Trust Westpac Investment Vehicle No.3 Pty Limited Series 2021-1 WST Trust Westpac New Zealand Limited SIE-LEASE (Australia) Pty Limited Westpac Notice Saver PIE Fund St.George Commercial Credit Corporation Pty Limited Westpac NZ Covered Bond Holdings Limited St.George Finance Limited Westpac NZ Covered Bond Limited St.George Motor Finance Limited Westpac NZ Operations Limited The Home Mortgage Company Limited Westpac NZ Securitisation Holdings Limited W2 Investments Pty Limited Westpac NZ Securitisation Limited Westpac (NZ) Investments Limited Westpac NZ Securitisation No.2 Limited Westpac Administration 3 Pty Limited Westpac Securities Limited Westpac Administration 4 Pty Limited Westpac Securities NZ Limited Westpac Altitude Rewards Trust Westpac Securitisation Management Pty Limited Westpac Asian Lending Pty Limited Westpac Singapore Limited Westpac Bank-PNG-Limited Westpac Syndications Management Pty Limited Westpac Capital Markets Holding Corp. Westpac Term PIE Fund

Pillar 3 report Appendix II | Entities included in regulatory consolidation 102 | Westpac Group September 2021 Pillar 3 report Level 3 Entities The following controlled entities are excluded from the Level 2 consolidation but form part of the conglomerate group at Level 3: Advance Asset Management Limited Reinventure Fund III I.L.P Asgard Capital Management Limited Reinventure Special Purpose Investment Unit Trust Asgard Wealth Solutions Limited Securitor Financial Group Pty Limited BT Funds Management (NZ) Limited Sydney Capital Corporation Inc. BT Funds Management Limited Waratah Receivables Corporation Pty Limited BT Funds Management No.2 Limited Waratah Securities Australia Limited BT Portfolio Services Limited Westpac Custodian Nominees Pty Limited eQR Securities Pty. Limited Westpac Financial Services Limited GIS Private Nominees Pty Limited Westpac Life Insurance Services Limited Hastings Funds Management Pty Limited Westpac Life-NZ-Limited Hyde Potts Insurance Services Pte. Limited Westpac New Zealand Staff Superannuation Scheme Trustee Limited Magnitude Group Pty Limited Pendal Short Term Income Fund Westpac Nominees-NZ-Limited Red Bird Ventures Limited Westpac RE Limited Reinventure Fund, I.L.P. Westpac Securities Administration Limited Reinventure Fund II I.L.P Westpac Superannuation Nominees-NZ-Limited

Pillar 3 report Appendix III | Level 3 entities’ assets and liabilities Westpac Group September 2021 Pillar 3 report | 103 The following legal entities are excluded from the regulatory scope of consolidation. The total assets and liabilities should not be aggregated because some of the entities are holding companies for other entities in the table shown below. 30 September 2021 $m Total Assets a) Securitisation Sydney Capital Corporation Inc. - - Waratah Receivables Corporation Pty Limited - 1 Waratah Securities Australia Limited - - b) Insurance, funds management and other Advance Asset Management Limited 58 39 Asgard Capital Management Limited 51 26 Asgard Wealth Solutions Limited 24 7 BT Funds Management (NZ) Limited 93 17 BT Funds Management Limited 510 390 BT Funds Management No.2 Limited 9 2 BT Portfolio Services Limited 154 90 eQR Securities Pty. Limited - - GIS Private Nominees Pty Limited 9 3 Hastings Funds Management Pty Limited - - Hyde Potts Insurance Services Pte. Limited 17 - Magnitude Group Pty Limited 4 - Pendal Short Term Income Fund 301 301 Red Bird Ventures Limited 6 2 Reinventure Fund II I.L.P 66 - Reinventure Fund III I.L.P 27 - Reinventure Fund, I.L.P. 140 85 Reinventure Special Purpose Investment Unit Trust 41 2 Securitor Financial Group Pty Limited 3 - Westpac Custodian Nominees Pty Limited - - Westpac Financial Services Limited 40 22 Westpac Life Insurance Services Limited 3,265 1,170 Westpac Life-NZ-Limited 259 (24) Westpac New Zealand Staff Superannuation Scheme Trustee Limited - - Westpac Nominees-NZ-Limited 4 - Westpac RE Limited 9 1 Westpac Securities Administration Limited 7 - Westpac Superannuation Nominees-NZ-Limited - - Liabilities (excluding equity)

Pillar 3 report Appendix IV | Regulatory expected loss 104 | Westpac Group September 2021 Pillar 3 report Capital deduction for regulatory expected loss2 For capital adequacy purposes APRA requires the amount of regulatory expected credit losses in excess of eligible provisions to be deducted from capital. The following table shows how the deduction is calculated. 30 September 31 March 30 September $m 2021 2021 2020 Provisions associated with eligible portfolios Total provisions for impairment charges 5,007 5,508 6,163 plus general reserve for credit losses adjustment - - - plus provisions associated with partial write-offs 40 20 26 less ineligible provisions1 (104) (106) (118) Total eligible provisions 4,943 5,422 6,071 Regulatory expected downturn loss 5,168 5,419 5,801 Excess/(shortfall) in eligible provisions compared to regulatory expected downturn loss (225) 3 270 Common equity Tier 1 capital deduction for regulatory expected downturn loss in excess of eligible provisions2 (225) (93) (40) 1 Provisions associated with portfolios subject to the Basel standardised approach to credit risk are not eligible. 2 Regulatory expected loss is calculated for portfolios subject to the Basel advanced IRB approach to credit risk. The comparison between regulatory expected loss and eligible provisions is performed separately for defaulted and non-defaulted exposures. As at 30 September 2021, there was $129 million excess of regulatory expected loss compared to eligible provisions for defaulted exposures (31 March 2020: $93 million).

Pillar 3 report Appendix V | APS330 quantitative requirements Westpac Group September 2021 Pillar 3 report | 105 The following table cross-references the quantitative disclosure requirements given by Attachments A, C, D and E of APS330 to the quantitative disclosures made in this report. The continuous reporting requirements for capital instruments under Attachment B are satisfied separately and can be found on the regulatory disclosures section on the Westpac website In addition to this report, the regulatory disclosures section of the Westpac website1 contains the reporting requirements for: Capital instruments under Attachment B of APS330; and The identification of potential Global-Systemically Important Banks (G-SIB) under Attachment H of APS330 (disclosed annually). APS330 reference Westpac disclosure Page General Requirements Paragraph 12 (a) (c) to (d) Balance Sheet Reconciliation 94 Paragraph 13 Level 3 entities’ assets and liabilities 103 Paragraph 49 Summary leverage ratio 22 Attachment A: Table 1: Capital disclosure template Capital disclosure template 97 Attachment C: Table 3: Capital adequacy (a) to (e) Capital requirements 20 (f) Westpac’s capital adequacy ratios 19 Capital adequacy ratios of major subsidiary banks 19 Table 4: Credit risk (a) Exposure at Default by major type 34 (b) Impaired and past due loans by portfolio 41 (c) General reserve for credit losses 31 Table 5: Securitisation exposures (a) Banking book summary of securitisation activity by asset type 67 (b) Banking book summary of on and off-balance sheet securitisation by exposure type 68 (c) Trading book summary of on and off-balance sheet securitisation by exposure type 71 Attachment D: Table 6: Capital adequacy (b) to (f) Capital requirements 20 (g) Westpac’s capital adequacy ratios 19 Capital adequacy ratios of major subsidiary banks 19 Table 7: Credit risk - general disclosures (b) Exposure at Default by major type 34 (c) Exposure at Default by geography 39 (d) Exposure at Default by industry classification 36 (e) Exposure at Default by residual contractual maturity 40 (f) Impaired and past due loans by industry classification 42 (g) Impaired and past due loans by geography 43 (h) Movement in provisions for impairment charges 32 (h) Loan impairment provisions 31 (i) Exposure at Default by measurement method 35 (j) General reserve for credit losses 31 Table 8: Credit risk - disclosures for portfolios subject to the standardised approach and supervisory risk-weights in the IRB approaches (formerly Table 5) (b) Portfolios subject to the standardised approach 44 Property finance 45 Project finance 46 1 http://www.westpac.com.au/about-westpac/investor-centre/financial-information/regulatory-disclosures/

Pillar 3 report Appendix V | APS330 quantitative requirements 106 | Westpac Group September 2021 Pillar 3 report APS330 reference Westpac disclosure Page Table 9: Credit risk - disclosures for portfolios subject to IRB approaches (d) Corporate portfolio by external credit rating 47 Business lending portfolio by external credit rating 48 Sovereign portfolio by external credit rating 49 Bank portfolio by external credit rating 50 Residential mortgages portfolio by PD band 51 Australian credit cards portfolio by PD band 52 Other retail portfolio by PD band 53 Small business portfolio by PD band 54 (e) Actual losses 55 (f) Comparison of regulatory expected and actual loss rates 56 Table 10: Credit risk mitigation disclosures (b) to (c) Total exposure covered by collateral, credit derivatives and guarantees 59 Table 11: General disclosure for exposures related to counterparty credit risk (b) Counterparty credit risk summary 61 (c) Credit derivative transactions that create exposures to counterparty credit risk 61 Table 12: Securitisation exposures Banking Book (g) part i and (h) to (i) Summary of assets securitised by Westpac 66 (g) part ii Summary of total Westpac sponsored third party assets securitised 66 (j) Summary of securitisation activity by asset type 67 (k) Summary of on and off-balance sheet securitisation by exposure type 68 (l) part i Securitisation exposure by risk weight band 69 (l) part ii Securitisation exposures deducted from capital 69 (m) Securitisation subject to early amortisation treatment 69 (n) part i Resecuritisation exposure subject to credit risk mitigation 69 (n) part ii Resecuritisation exposure to guarantors 70 Trading Book (o) part i and (p) Summary of assets securitised by Westpac 70 (o) part ii Summary of total Westpac sponsored third party assets securitised 70 (q) Summary of securitisation activity by asset type 70 (r) Aggregate amount of exposures securitised by Westpac and subject to APS116 Capital Adequacy: Market Risk 70 (s) Summary of on and off-balance sheet securitisation by exposure type 71 (t) part i Securitisation exposure retained or purchase subject to specific risk 71 (t) part ii Securitisation exposure subject to APS120 for Specific risk by risk weight band 71 (u) part i Capital requirements for securitisation exposure subject to internal models approach (IMA) by risk classification 71 (u) part ii Capital requirements for securitisation regulatory capital approaches by risk weight band 71 (u) part iii Securitisation exposures deducted from capital 72 (v) Securitisation subject to early amortisation treatment 72 (w) part i Aggregate resecuritisation exposures retain or purchased subject to credit risk mitigation 72 (w) part ii Resecuritisation exposure to guarantors credit worthiness 72

Pillar 3 report Appendix V | APS330 quantitative requirements Westpac Group September 2021 Pillar 3 report | 107 APS330 reference Westpac disclosure Page Table 13: Market risk - disclosures for ADIs using the standard method (b) Market Risk regulatory capital and risk weighted assets 74 Table 14: Market risk - disclosures for ADIs using the IMA for trading portfolios (d) VaR and Stressed VaR by risk type 75 Table 16: Equities - disclosures for banking book positions (b) to (c) Book value of listed equity exposures by industry classification / Book value of unlisted equity exposures by industry classification 82 (d) to (e) Gains/losses 82 (f) Capital requirement1 NA Table 17: Interest rate risk in the banking book (b) Change in economic value of sudden upward and downward movement in interest rates 78 (b) Capital requirement 78 Attachment E Table 18: Leverage ratio disclosure template Leverage ratio disclosure 22 Table 19: Summary comparison of accounting assets vs leverage ratio exposure measure Summary comparison of accounting assets vs leverage ratio exposure measure 23 Attachment F Table 20: Liquidity Coverage Ratio disclosure template Liquidity Coverage Ratio disclosure 84 Table 21: Net Stable Funding Ratio template Net Stable Funding Ratio disclosure 85 Attachment G2 Table 21: Remuneration disclosure requirements (g) Governance structure 90 (h) Quantitative Disclosures 93 (i) Deferred remuneration 93 (j) to (k) Total value of remuneration awards for the current financial year for senior managers and material risk takers 93 1 Equity exposures are not risk weighted at Level 2. 2 Remuneration disclosure is an annual reporting requirement under APS330.

Pillar 3 report Glossary Westpac Group September 2021 Pillar 3 report | 109 Term Description Defaulted not impaired Includes facilities where: contractual payments of interest and/or principal are 90 or more calendar days overdue, including overdrafts or other revolving facilities that remain continuously outside approved limits by material amounts for 90 or more calendar days (including accounts for customers who have been granted hardship assistance); or an order has been sought for the customer’s bankruptcy or similar legal action has been instituted, which may avoid or delay repayment of its credit obligations; and the estimated net realisable value of assets/security to which Westpac has recourse is sufficient to cover repayment of all principal and interest, or where there are otherwise reasonable grounds to expect payment in full and interest is being taken to profit on an accrual basis. These facilities, while in default, are not treated as impaired for accounting purposes. Double default rules Double default applies to exposures where a particular obligor’s exposure has been hedged by the purchase of credit protection from a counterparty and loss will only occur if both obligor and counterparty default. In this instance, capital can be reduced. Exposure at default (EAD) EAD is calculated at facility level and includes outstandings as well as the proportion of committed undrawn that is expected to be drawn in the event of a future default. Extended licensed entity (ELE) An extended licensed entity (ELE) comprises an ADI and any subsidiaries of the ADI that have been approved by APRA as being part of a single ‘stand- alone’ entity. External credit assessment institution (ECAI) ECAI is an external institution recognised by APRA (directly or indirectly) to provide credit assessment in determining the risk-weights on financial institutions’ rated credit exposures (including securitisation exposures). Geography Geographic segmentation of exposures is based on the location of the office in which these items were booked. High-quality liquid assets (HQLA) Assets which meet APRA’s criteria for inclusion as HQLA in the numerator of the LCR. Impaired exposures Includes exposures that have deteriorated to the point where full collection of interest and principal is in doubt, based on an assessment of the customer’s outlook, cashflow, and the net realisation of value of assets to which recourse is held: facilities 90 days or more past due, and full recovery is in doubt: exposures where contractual payments are 90 or more days in arrears and the net realisable value of assets to which recourse is held may not be sufficient to allow full collection of interest and principal, including overdrafts or other revolving facilities that remain continuously outside approved limits by material amounts for 90 or more calendar days; non-accrual facilities: exposures with individually assessed impairment provisions held against them, excluding restructured loans; restructured facilities: exposures where the original contractual terms have been formally modified to provide for concessions of interest or principal for reasons related to the financial difficulties of the customer; other assets acquired through security enforcement (includes other real estate owned): includes the value of any other assets acquired as full or partial settlement of outstanding obligations through the enforcement of security arrangements; and any other facilities where the full collection of interest and principal is in doubt.

Pillar 3 report Glossary 110 | Westpac Group September 2021 Pillar 3 report Term Description Industry Exposures to businesses, government and other financial institutions are classified into industry clusters based upon groups of related ANZSIC codes. Companies that operate in multiple industries are classified according to their primary industry. Consumer customers as classified as “retail” and not further broken down. Interest rate risk in the banking book (IRRBB) The risk to current and future year interest income arising from a mismatch between the duration of assets and liabilities that arises in the normal course of banking activities. Internal ratings-based approach (IRB & Advanced IRB) These approaches allow banks to use internal estimates of the risks of their loans as inputs into the determination of the amount of credit risk capital needed to support the organisation. In the Advanced IRB approach, banks must supply their own estimates for all three credit parameters – Probability of Default, Loss Given Default and Exposure at Default. Leverage ratio The leverage ratio is defined by APRA as Tier 1 capital divided by the “Exposure measure” and is expressed as a percentage. “Exposure measure” includes on-balance sheet exposures, derivatives exposures, securities financing transaction (SFT) exposures, and other off-balance sheet exposures. Liquidity coverage ratio (LCR) An APRA requirement to maintain an adequate level of unencumbered high quality liquid assets, to meet liquidity needs for a 30 calendar day period under an APRA-defined severe stress scenario. Absent a situation of financial stress, the value of the LCR must not be less than 100%. LCR is calculated as the percentage ratio of stock of HQLA, CLF and qualifying Reserve Bank of New Zealand securities over the total net cash out flows in a modelled 30 day defined stressed scenario. Loss given default (LGD) The LGD represents an estimate of the expected severity of a loss to Westpac should a customer default occur during a severe economic downturn. Westpac assigns LGD to each credit facility, assuming an event of default has occurred and taking into account a conservative estimate of the net realisable value of assets to which Westpac has recourse and over which it has security. LGDs also reflect the seniority of exposure in the customer’s capital and debt structure. Maturity The maturity date used is drawn from the contractual maturity date of the customer loans. Mark-to-market related credit risk The risk of mark-to-market losses related to deterioration in the credit quality of a derivative counterparty also referred to as credit valuation adjustment (CVA) risk. Monte Carlo simulation A method of random sampling to achieve numerical solutions to mathematical problems. Net cash outflows Total expected cash outflows minus total expected cash inflows in the specified LCR stress scenario calculated in accordance with APRA’s liquidity standard. Net interest income at risk (NaR) BRiskC approved limit expressed as a defined basis point shock in interest rates over a one year risk horizon. Net Stable Funding Ratio (NSFR) The NSFR is defined as the ratio of the amount of available stable funding (ASF) to the amount of required stable funding (RSF) defined by APRA. The amount of ASF is the portion of an ADI’s capital and liabilities expected to be a reliable source of funds over a one year time horizon. The amount of RSF is a function of the liquidity characteristics and residual maturities of an ADI’s assets and off-balance sheet activities. ADI’s must maintain an NSFR of at least 100%. Off-balance sheet exposure Credit exposures arising from facilities that are not recorded on Westpac's balance sheet (under accounting methodology). Undrawn commitments and the expected future exposure calculated for Westpac's derivative products are included in off-balance sheet exposure.

Pillar 3 report Glossary Westpac Group September 2021 Pillar 3 report | 111 Term Description On balance sheet exposure Credit exposures arising from facilities that are recorded on Westpac's balance sheet (under accounting methodology). Potential future credit exposure (PFCE) The PFCE for each transaction is calculated by multiplying the effective notional principal amount by a credit conversion factor specified in APS112. Probability of default (PD) Probability of default is a through-the-cycle assessment of the likelihood of a customer defaulting on its financial obligations within one year. Resecuritisation A resecuritisation exposure is a securitisation exposure in which the risk associated with an underlying pool of exposures is tranched and at least one of the underlying exposures is a securitisation exposure. In addition, an exposure to one or more resecuritisation exposures is a resecuritisation exposure; Risk weighted assets (RWA) Assets (both on and off-balance sheet) are risk weighted according to each asset's inherent potential for default and what the likely losses would be in case of default. In the case of non-asset backed risks (i.e. market and operational risk), RWA is determined by multiplying the capital requirements for those risks by 12.5. Securitisation purchased The purchase of third party securitisation exposure, for example residential mortgage backed securities. Securitisation retained Securitisation exposures arising through Westpac originated assets or generated by Westpac third party securitisation activity. Securities financing transactions (SFT) APRA defines SFTs as “transactions such as repurchase agreements, reverse repurchase agreements, and security lending and borrowing, and margin lending transactions, where the value of the transactions depends on the market valuation of securities and the transactions are typically subject to margin agreements.” Sponsor An ADI would generally be considered a sponsor if it, in fact or substance, manages or advises the securitisation program, places securities into the market, or provide liquidity and/or credit enhancements. Standard model The standard model for Market risk applies supervisory risk weights to trading positions. Stressed VaR (SVaR) Stressed VaR uses the approved VaR model but applies a period of significant market stress. Market risk capital is estimated by adding Stressed VaR to regular VaR. Substitution approach Substitutions refers to the rules governing the circumstances when capital can be reduced because an obligor’s exposure has been hedged by the purchase of credit protection from a counterparty and the counterparty’s PD is used in place of the obligors’ PD. Supervisory Formula Approach (SFA) The SFA applicable to unrated exposures dynamically looks at the type and performance of underlying asset pools funded by the securitisation exposure as well as the structural features of the transaction to determine capital requirements Tier 2 capital Includes other capital elements, which, to varying degrees, fall short of the quality of Tier 1 capital but still contribute to the overall strength of an entity as a gone concern capital.

Pillar 3 report Glossary 112 | Westpac Group September 2021 Pillar 3 report Term Description Trading book Trading book activity represents dealings that encompass book running and distribution activity. The types of market risk arising from trading activity include interest rate risk, foreign exchange risk, commodity risk, equity price risk, credit spread risk and volatility risk. Financial Markets and Treasury are responsible for managing market risk arising from Westpac’s trading activity. Value at risk (VaR) VaR is the potential loss in earnings from adverse market movements and is calculated over a one-day time horizon at a 99% confidence level using a minimum of one year of historical rate data. VaR takes account of all material market variables that may cause a change in the value of the trading portfolio and the banking book including interest rates, foreign exchange rates, price changes, volatility, and the correlation among these variables. Exchange rates The following exchange rates were used in the Westpac Pillar 3 report, and reflect spot rates for the period end. $ 30 September 2021 31 March 2021 30 September 2020 USD 0.7205 0.7596 0.7108 GBP 0.5359 0.5536 0.5540 NZD 1.0477 1.0892 1.0802 EUR 0.6211 0.6487 0.6060

Pillar 3 report Disclosure regarding forward-looking statements Westpac Group September 2021 Pillar 3 report | 113 This report contains statements that constitute ‘forward-looking statements’ within the meaning of Section 21E of the US Securities Exchange Act of 1934. Forward-looking statements are statements about matters that are not historical facts. Forward-looking statements appear in a number of places in this report and include statements regarding Westpac’s intent, belief or current expectations with respect to its business and operations, market conditions, results of operations and financial condition, including, without limitation, future loan loss provisions and financial support to certain borrowers. Words such as ‘will’, ‘may’, ‘expect’, ‘intend’, ‘seek’, ‘would’, ‘should’, ‘could’, ‘continue’, ‘plan’, ‘estimate’, ‘anticipate’, ‘believe’, ‘probability’, ‘risk’, ‘aim’, ‘outlook’ or other similar words are used to identify forward-looking statements. These forward-looking statements reflect Westpac’s current views with respect to future events and are subject to change, certain risks, uncertainties and assumptions which are, in many instances, beyond Westpac’s control, and have been made based upon management’s expectations and beliefs concerning future developments and their potential effect upon Westpac. There can be no assurance that future developments will be in accordance with Westpac’s expectations or that the effect of future developments on Westpac will be those anticipated. Actual results could differ materially from those expected, depending on the outcome of various factors, including, but not limited to: information security breaches, including cyberattacks; the effect of the global COVID-19 pandemic, which has had, and may continue to have, a negative impact on our business and global economic conditions, adversely affect a wide-range of Westpac’s key suppliers, third- party contractors and customers, create increased volatility in financial markets and result in increased impairments, defaults and write-offs; the effect of, and changes in, laws, regulations, taxation or accounting standards or practices and government policy, particularly changes to liquidity, leverage and capital requirements; regulatory investigations, reviews and other actions, inquiries, litigation, fines, penalties, restrictions or other regulator imposed conditions, including as a result of our actual or alleged failure to comply with laws (such as financial crime laws), regulations or regulatory policy; the effectiveness of Westpac’s risk management policies, including internal processes, systems and employees, and operational risks resulting from ineffective processes and controls, as well as breakdowns in processes and procedures requiring remediation activity; the failure to comply with financial crime obligations, which has had, and could further have, adverse effects on our business and reputation; the occurrence of environmental change (including as a result of climate change) or external events in countries in which Westpac or its customers or counterparties conduct their operations; internal and external events which may adversely impact Westpac’s reputation; litigation and other legal proceedings and regulator investigations and enforcement actions; reliability and security of Westpac’s technology and risks associated with changes to technology systems; the stability of Australian and international financial systems and disruptions to financial markets and any losses or business impacts Westpac or its customers or counterparties may experience as a result; market volatility, including uncertain conditions in funding, equity and asset markets; the incidence of inadequate capital levels under stressed conditions; the risk that governments will default on their debt obligations or will be unable to refinance their debts as they fall due; changes to Westpac’s credit ratings or the methodology used by credit rating agencies; changes in political, social or economic conditions in any of the major markets in which Westpac or its customers or counterparties operate; changes in economic conditions, consumer spending, saving and borrowing habits in Australia, New Zealand and other countries (including as a result of tariffs and other protectionist trade measures) in which Westpac or its customers or counterparties conduct their operations and Westpac’s ability to maintain or to increase market share, margins and fees, and control expenses; adverse asset, credit or capital market conditions; an increase in defaults in credit exposures because of a deterioration in economic conditions; an increase in defaults, write-offs and provisions for credit impairments; the effects of competition, including from established providers of financial services and from non-financial services entities, in the geographic and business areas in which Westpac conducts its operations; levels of inflation, interest rates (including low or negative interest rates), exchange rates and market and monetary fluctuations and volatility; poor data quality or poor data retention; strategic decisions including diversification, innovation, divestment, acquisitions or business expansion activity, including the integration of new businesses;