NAB.005.419.0001

2015 Year End Employee Share Offer Guide

March 2016

This guide explains the terms and conditions of your invitation to participate in the Offer. The NAB shares on offer are provided under the Plan which, together with this guide, sets out the terms and conditions of the NAB shares. You can obtain a copy of the Plan, without charge, by contacting Computershare during AEDT business hours. Copies are also available on the NAB Employee Online Website. The terms set out in this guide may vary from those previously communicated and you should read them carefully. In the event of any inconsistency, the terms in this guide expressly prevail over any communications relating to your NAB shares. The information in this guide, any accompanying information and any advice provided by NAB in connection with the Offer is general advice only and does not take into account your personal objectives, financial situation and needs. You should consider obtaining your own financial product advice from an independent person who is appropriately authorised or licenced to give such advice. This document has not been reviewed by or registered with any regulatory authority in any jurisdiction.

National Australia Bank Limited ABN 12 004 044 937 NAB.005.419.0002

1. Key dates

Key dates

Offer period 5 February 2016 to 19 February 2016

Opt-out Date 5:00pm 19 February 2016 (AEDT)

WASP Period The five trading days from 22 February 2016 to 26 February 2016 inclusive

Anticipated Allocation Date 2 March 2016

End of the Restriction Period 2 March 2019

End of the Retention Period1 2 September 2019

2. Details of the offer

Key questions Answer

What’s on offer? NAB shares to the approximate value of A$1,000 to recognise Group performance in the last financial year.

How many NAB The number of NAB shares on offer is worked out using the following formula: shares are on offer? A$1,000 WASP at which NAB shares are traded on the ASX during the WASP Period (rounded down to the nearest whole number of NAB shares)

This WASP can differ from the average closing prices over the WASP Period because it reflects the volume of NAB shares traded and the price at which they were traded.

Who can participate You need to meet the following 3 criteria to be eligible to participate in the Offer: in the offer? 1. You need to have been a Permanent Employee with at least six months continuous service as at the end of NAB’s last financial year. This is required as the offer recognises the Group’s performance in the last financial year. Casual and temporary employees and employees on career break are not eligible to participate. 2. You must still be a Permanent Employee on the Allocation Date 3. You must not be eligible to participate in the Executive Long Term Incentive program or a business unit specific long term incentive program. You are not eligible to receive NAB shares simply because you have received this guide.

1 Only applicable if you are a UK Material Risk Taker (as advised by NAB). NAB Year End Share Offer Guide Page 2 NAB.005.419.0003

Key questions Answer

What do I need to do You do not need to take any action to participate in the offer and you do not need to to participate? pay anything to be allocated the NAB shares.2

What do I do if I don’t If you DO NOT want to participate, then you need to opt-out before 5pm AEDT on the want to participate? Opt-out Date. You can opt-out by visiting www.computershare.com/employee/au/offerlogin/nab and following the prompts to complete the opt-out process. You will receive a confirmation of your opt-out approximately one week after you have completed the online opt-out process. If you qualify for this Offer and you opt out, then you will not receive NAB shares. In addition, cash will not be provided as an alternative.

How will I know if I You will receive a confirmation of the share allocation from Computershare shortly after have received the the Allocation Date. NAB shares?

3. Dealing in the NAB shares

Key questions Answer

Will I be free to deal No. If you participate, your NAB shares will be held by the Trustee on your behalf until with my NAB shares the earlier of: from the Allocation  three years from the Allocation Date; or Date?  the date on which you cease “relevant employment” (see below). This period is called the Restriction Period. You can’t deal in your NAB shares during that time. 3

What can I do at the You can choose to either sell or keep the NAB shares. Information on how to do this end of the can be obtained from Computershare at the end of the Restriction Period. If you Restriction Period? 4 decide to sell the NAB shares you will then receive the proceeds of sale (after sale costs have been deducted). If you don’t give any instructions about how you want to deal with the NAB shares, the Trustee can still decide to sell them on your behalf or alternatively it can transfer them into your name. The Trustee may require you to reimburse costs associated with any transfer or sale.

2 New Zealand employees only:  You must pay the Trustee the nominal amount of NZ$1.00 for all shares acquired under the Plan. If you do not opt out, the Bank of New Zealand or National Nominees Limited (as applicable) are authorised, at a time determined by NAB, to deduct from your salary or nominated bank account (if on extended unpaid leave), the amount of NZ$1.00 to be paid to the Trustee in respect of this Offer. The Trust Deed governing the Plan provides that you may apply for a loan for the NZ$1.00; and  You also instruct the Trustee to subscribe for or purchase (as NAB thinks fit) the shares on your behalf to be held under the terms of the Plan and by doing so you irrevocably confirm that, whilst the shares are held in trust, you will not participate in NAB's Bonus Share Plan or Share Purchase Plan or seek to instruct the Trustee to do so and, accordingly, irrevocably you instruct NAB to disregard any request or instruction to the contrary. You agree to be bound by the terms and conditions of the Offer, the Trust Deed of the Plan and the constitution of NAB. 3 UK Employees Only: If you are a UK Material Risk Taker (as advised by NAB):  at the end of the Restriction Period there is a further Retention Period which ends on the earlier of:  the End of the Retention Period (as described in the Key Dates section); or  the date on which you cease "relevant employment".  you can’t deal in your NAB shares during the Restriction Period or the Retention Period although, where required by law, the Trustee may transfer or deal with your shares even though the Restriction Period or Retention Period has not ended; and  if you have a tax liability at the End of the Restriction Period, the default position is that NAB (and/or your employer or former employer) will sell or procure the sale of a sufficient number of your NAB shares at that time to fund your tax liability (unless the liability is met by deducting the necessary amount from your remuneration or you paying the necessary amount directly to the NAB Group) and only a net number of shares will be subject to the Retention Period. 4 Or, if you are a UK Material Risk Taker (as advised by NAB), at the End of the Retention Period. NAB Year End Share Offer Guide Page 3 NAB.005.419.0004

Key questions Answer

What happens to my Your “relevant employment” continues provided you continue to be employed by the NAB shares if I cease company that employed you on the Allocation Date. It will also continue if you cease to employment with the be employed by that company, but you remain employed by a company in the NAB NAB Group? Group. If you cease “relevant employment” before the Restriction Period is over, you can either keep or sell your NAB shares at that time.5 You will need to instruct the Trustee once you have decided what you would like to do. Information on how to do this will be provided by Computershare at the relevant time.

4. Other important information6

Key questions Answer

Will I receive All dividends earned from the NAB shares are yours from the Allocation Date. dividends on my NAB’s dividends are generally paid twice a year. However, the payment of dividends NAB shares? depends on a number of things including NAB’s profitability and dividend policy. You will need to ensure that your banking details for any future dividends are up to date. Any dividend paid will be credited to the account into which NAB pays your salary. 7 If you do not want your dividend to be paid into that account and would prefer to provide alternative payment instructions you can update your payment details by submitting instructions online at www.computershare.com/employee/nab. NAB shares acquired under the offer are eligible to participate in NAB’s Dividend Reinvestment Plan even while they are held in trust.8

Can I vote my NAB You can vote at shareholder meetings while the NAB shares are held by the Trustee shares? but to do so you must instruct the Trustee in writing how to vote on your behalf. To be valid, your instructions must be received by the Trustee no later than 72 hours before the start of the relevant shareholder meeting. To receive notices of meeting, you must first contact the Trustee and instruct it that you wish to receive the notices for that particular calendar year. The Trustee can be contacted through Computershare.

5 For United States employees only:  If during the Restriction Period you cease to be employed by the Group:  by reason of resignation or dismissal, the shares will be forfeited; or  by reason of attainment of age 65, the Group retains the discretion to determine if your shares will be forfeited or if you will be eligible to keep or sell the shares; or  for any other reason (e.g. death, accident, sickness, or redundancy) you will be able to choose whether to keep, or to sell the shares at that time. For United Kingdom employees only:  If during the Restriction Period you cease to be employed by the Group:  by reason of resignation or dismissal, the shares will be forfeited; or  for any other reason (e.g. death, accident, sickness, retirement or redundancy) you will be able to choose whether to keep, or to sell the shares at that time. For New Zealand employees only:  If during the three year Restriction Period you cease to be employed by the Group by reason of death, permanent disability, redundancy or retirement at normal retiring age, the Trustee will transfer the shares to you.; or  If you cease to be employed for any other reason (for example voluntary resignation or dismissal), the Trustee will purchase the shares from you for the nominal price of NZ$1.00. Accordingly, in those circumstances, you will effectively receive no benefit from the Plan. 6 Important notice for Hong Kong employees: The contents of this document have not been reviewed by any regulatory authority in Hong Kong. You are advised to exercise caution in relation to the Offer. If you are in doubt about any of the contents of this document, you should obtain independent professional advice. Important notice for Singapore employees: This document has not been registered as a prospectus with the Monetary Authority of Singapore. Accordingly, this document and any other document or material in connection with the offer or sale, or invitation for subscription or purchase, of NAB shares may not be circulated or distributed, nor may NAB shares be offered or sold, or be made the subject of an invitation for subscription or purchase, whether directly or indirectly, to persons in Singapore other than pursuant to, and in accordance with, the conditions of an exemption under any provision of Subdivision (4) of Division 1 of Part XIII of the Securities and Futures Act, Chapter 289 of Singapore. Important notice for Japanese employees: No registration statement has been filed for this offer since Article 4, Paragraphs 1 to 3 of the Financial Instruments and Exchange Act do not apply to this offer. 7 Not applicable to employees based in Asia. 8 Employees based in the United States will not be entitled to participate in NAB’s Dividend Reinvestment Plan.

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Key questions Answer

Can I participate in While the NAB shares are held by the Trustee, you will be able to participate in any rights issues and NAB bonus issues and rights issues. You will be contacted directly if NAB conducts a bonus issues? bonus issue or rights issue.

What are the risks? There are a number of potential risks that you should consider before accepting the NAB shares, including risks that may affect NAB’s business and financial performance. A selection of those risks, which have been based on an assessment of a combination of the probability of the risk occurring and the impact of the risk if it did occur, are included in NAB’s most recent annual report which is available at www.nabgroup.com/annualreports. Before accepting any NAB shares, you should consider whether NAB shares are suitable for you.

Are there insider Yes - as an employee of the NAB Group you may be in a privileged position where you trading rules I need know something that is not yet public knowledge but could affect the NAB share price to consider? when made public. You are not allowed to make financial gain for yourself using this knowledge. You should check NAB’s Group Securities Trading Policy (available at http://www.nab.com.au/about-us/our-business/corporate-governance) before applying for, buying, selling or transferring NAB shares. If you believe you have price-sensitive information you cannot buy, sell or otherwise transfer your NAB shares. If you are uncertain of your position, you should discuss your circumstances with Group Governance on (+61 3) 8634 2345. It is a condition of the Offer that you comply with NAB’s Group Securities Trading Policy in relation to your NAB shares at all times.

How do I obtain NAB’s Intranet home page and Internet site (http://www.nab.com.au) both contain NAB’s share price information on the current share price. Several other sites on the internet provide and most recent broader share market information, and most Australian major newspapers contain a list annual report? of daily share prices in the business section. Computershare can also provide you with the current market price of NAB shares and will ensure that you get this information promptly by phone or email. You may obtain a copy of NAB's most recent annual report and the most recent published financial statements at http://www.nab.com.au/about-us/shareholder- centre/financial-disclosuresandreporting/reports-and-presentations. You may also request printed copies, free of charge, from Computershare either by email at [email protected] or by telephone on 1300 367 647 (within Australia) or +61 3 9415 4299 (outside Australia).

Are there any other NAB may amend the Plan from time to time, provided that the amendment does not key terms of the Plan reduce the existing rights of participating employees (except in certain limited I need to be aware circumstances). of? The Board’s decision as to the interpretation, effect or application of the Plan is final and conclusive. The Board may make further rules for the operation of the Plan, which are consistent with the Plan. Any powers or discretions that are conferred on the Board under the Plan may be exercised by the Board or any person or persons appointed to act on its behalf. The Board can decide to suspend or cancel the Plan at any time. The suspension or cancellation of the Plan will not prejudice the existing rights of participating employees. Nothing in the Plan confers on any employee the right to receive NAB shares or to continue as an employee of the Group, nor affects any rights of the Group to terminate an employee’s employment.

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Key questions Answer

What happens if NAB If NAB (or a member of the Group) is required to account to a tax authority for any tax, is required to levy or charge on your behalf in relation to your NAB shares, then the relevant Group account to a tax company may recover an amount equal to the tax liability from you in any manner that authority for any tax the Board thinks fit. Subject to applicable law, this may involve: on my behalf?  deducting an amount equal to the tax liability from your remuneration; or  you paying an amount equal to the tax liability directly to the relevant Group company.

What do I need to NAB Group will collect, use and disclose your personal information for the purpose of know about privacy? administering your participation in the Offer and the Plan, and as otherwise permitted by law. Your personal information may also be disclosed to third parties (such as share registries, print and mail service providers and investment advisers) for these purposes (Third Parties). NAB Group and Third Parties may operate in countries other than Australia; please see www.nab.com.au/overseascountrieslist Please note that if you do not provide any of the information requested by NAB it may not be possible for you to participate in the Offer or to process your request to opt-out. If you would like to access or correct your personal information, or for further information, including about complaint handling, please see www.nab.com.au/privacy

Who do I contact if I Contact Computershare: have a question? GPO Box 658, Melbourne, Victoria, 3001, Australia Phone: 1300 556 324 or (+613) 9415 4298 [email protected] Visit the NAB Employee Centre at www.computershare.com/employee/nab Email NAB Performance and Rewards at [email protected]

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5. Glossary

A$ Australian dollars

Allocation Date The date the NAB shares are allocated to you

ASX Australian Securities Exchange Limited or the securities market operated by it

Board All or some NAB directors acting as a board or a committee of directors (or delegate)

Computershare – Computershare Plan Managers maintains records of NAB shares, NAB shareholders keeping records and Plan participants. The records maintained by Computershare are relied on for such things as the payment of dividends and dispatch of notices to employee shareholders – it’s important to let them know if you change your address and other personal details

Group or NAB Group NAB and its subsidiary companies

NAB National Australia Bank Limited

NAB Employee www.computershare.com/employee/nab Online Website

NAB shares Ordinary fully paid shares in NAB

Offer Year End Employee Share Offer

Permanent Employee A permanent employee (including an employee on a fixed term contract) of a company in the Group

Plan For Australian and Asia employees means the National Australia Bank Staff Share Allocation Plan For NZ employees means the National Australia Bank New Zealand Staff Share Allocation Plan For United States and United Kingdom employees means National Australia Bank Staff Share Ownership Plan

Restriction Period The period during which your NAB shares will be held by the Trustee on your behalf and you cannot deal with those NAB shares

Trustee A trustee is a person or company that holds the assets of a trust on behalf of other people. A trustee is given powers, within legal obligations, to administer the trust. The current trustee is National Australia Trustees Limited

WASP Weighted average share price

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