Toronto-dominion Bank · TSX:TD
Toronto-dominion Bank — TD Bank Group — Q4 2018 Earnings Presentation
34 slides from Toronto-dominion Bank's earnings presentation, 2018
Slide 1: TD Bank Group Investor Presentation
TD Bank Group Investor Presentation Q4 2018
Slide 2: Caution Regarding Forward-Looking Statements
Caution Regarding Forward-Looking Statements From time-to-time, the Bank (as defined in this document) makes written and/or oral forward-looking statements, including in this document, in other filings with Canadian regulators or the United States (U.S.) Securities and Exchange Commission (SEC), and
Slide 3: TD Bank Group – Key Themes
TD Bank Group – Key Themes 5th largest bank by Total Assets1 1 Top 10 North American Bank 6th largest bank by Market Cap1 Delivering top tier long 2 Proven Performance term shareholder returns2 Highly rated 3 Strong Balance Sheet and Capital Position by major credit rating agencies Targeting 7-10% 4
Slide 4: TD Snapshot
TD Snapshot Our Businesses Canadian Retail Personal banking, credit cards and auto finance Small business and commercial banking Direct investing, advice-based wealth businesses, and asset management Q4 20181 Canadian U.S. Property, casualty, life and health (C$) Retail Retail insurance Fina
Slide 5: Our Strategy
Our Strategy Own the future TD aims to stand out from its peers by having a differentiated brand – anchored in our proven business model, and rooted in a desire to give our customers, communities and colleagues the confidence to thrive in a changing world. Proven business model Purpose-driven Forwar
Slide 6: TD Framework
TD Framework Our vision Be the better bank Own the future i>) efe Develop Our purpose Enrich the lives of our customers, communities TD Framework and colleagues Think like a customer; Act like an owner; lead provide legendary with integrity to drive experiences business results and trusted advice an
Slide 7: Competing in Attractive Markets
Competing in Attractive Markets Country Statistics Country Statistics 10th largest economy World’s largest economy Real GDP of C$1.9 trillion Real GDP of US$18.6 trillion Population of 37 million Population of 329 million Canadian Banking System U.S. Banking System One of the soundest
Slide 8: Top North American Bank
Top 10 North American Bank North Q4 2018 Canadian American C$ except otherwise noted Ranking4 Ranking5 Total assets $1,335B 1st 5th Total deposits $851B 1st 5th Market capitalization $133.5B 2nd 6th Reported net income (trailing four quarters) $11.3B 2nd 5th Adjusted net income1 (trailing four quart
Slide 9: Diversified Business Mix
Diversified Business Mix Fiscal 2018 Reported Earnings Mix1 Three key business lines Canadian Retail robust retail banking platform in Canada with proven performance Canadian Retail U.S. Retail2 U.S. Retail top 10 bank4 in 58% 28% the U.S. with significant organic growth opportunities Wholesal
Slide 10: Growing platform / North American scale…
Growing platform / North American scale… Increasing Retail Focus Acquired Acquired Target Completed TD Became primary Chrysler credit card portfolio Completed strategic acquisition of Acquired Waterhouse Acquired Commerce Acquired issuer of Aeroplan Completed Privatized Financial & Epoch; and credit
Slide 11: Connected Experiences
Connected Experiences Consistent Strategy Q4 2018 Highlights How we compete >12.5 ~4.7 MILLION ~3.0 MILLION Enabling seamless interactions MILLION CANADIAN MOBILE between customers and the ACTIVE DIGITAL U.S. MOBILE USERS USERS entire organization CUSTOMERS Leveraging industry leading Experience
Slide 12: The Better Bank
The Better Bank The Ready Commitment: Targeting $1 billion in community giving by 2030 The Ready Commitment targets Financial Security $1 billion by 2030 Opening doors Vibrant Planet for a more inclusive tomorrow Connected Communities Better Health Q4 Highlight: Awarded community organizations $10 m
Slide 13: Corporate Responsibility Performance
Corporate Responsibility Performance Highlights TD's low carbon commitment will target $100B by 2030 to support the transition to a low-carbon economy, Low Carbon Early UN PRI Top Green Bond drive innovation, accelerate renewable energy Commitment signatory underwriter targets $100B by and UNEP FI
Slide 14: TD Bank Group – Key Themes
TD Bank Group – Key Themes 5th largest bank by Total Assets1 1 Top 10 North American Bank 6th largest bank by Market Cap1 Delivering top tier long 2 Proven Performance term shareholder returns2 Highly rated 3 Strong Balance Sheet and Capital Position by major credit rating agencies Targeting 7-10% 4
Slide 15: Consistent Earnings Growth
Consistent Earnings Growth Targeting 7-10% adjusted EPS growth over the medium term4 Reported Earnings1,2 (C$MM) $11,334 Wholesale Banking $10,517 U.S. Retail $8,936 $8,024 Canadian Retail $7,883 $6,640 2013 2014 2015 2016 2017 2018 1. For the purpose of calculating contribution by each business seg
Slide 16: Solid Total Shareholder Returns
Solid Total Shareholder Returns Top tier total shareholder returns in 3, 5 and 10 year periods1 Canadian North American Ranking2 Ranking3 One-Year 3.1% 3rd 4th Three-Year 14.9% 1st 4th Five-Year 12.8% 1st 4th 10-Year 14.0% 1st 1st 1. Total shareholder return (TSR) calculated based on share price mov
Slide 17: Strong, Consistent Dividend History
Strong, Consistent Dividend History Dividends Per Share $2.68 (C$) Q1/18: Announced $0.07 dividend increase1 Dividend yield: 3.5%2 Q3/12: Increased target $0.33 payout range to 40%-50%3 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 4 1. For
Slide 18: High Quality Loan Portfolio
High Quality Loan Portfolio Balances ($B unless otherwise noted) Q3/18 Q4/18 Canadian Retail Portfolio $409.1 $416.7 Personal $335.1 $341.1 Residential Mortgages 191.8 194.1 Home Equity Lines of Credit (HELOC) 83.4 86.3 Indirect Auto 23.8 24.2 Unsecured Lines of Credit 9.9 10.1 Credit Cards 17.9 18.
Slide 19: Strong Credit Quality
Strong Credit Quality GIL and PCL Ratios (bps) 83 81 78 66 63 61 60 58 58 56 50 49 47 50 43 41 39 38 39 37 37 34 34 31 2007 2008 2009 1 2010 2011 2012 2013 2014 2015 2016 2017 2018 2 IFRS IFRS 9 Gross Impaired Loans / Gross Loans and Acceptances (bps) Provision for Credit Losses / Average Net Loans
Slide 20: Q4 2018 Highlights
Q4 2018 Highlights Total Bank Reported Results (YoY) Financial Highlights $MM Reported Q4/18 Q3/18 Q4/17 EPS up 11% Revenue 10,122 9,885 9,270 Adjusted1 EPS up 20% PCL 670 561 578 Revenue up 9% Expenses 5,352 5,117 4,828 Net Income 2,960 3,105 2,712 Expenses up 11% Diluted EPS ($) 1.58 1.65 1.42 P
Slide 21: Q4 2018 Segment Highlights
Q4 2018 Segment Highlights Net income was $1.7B, up 5% YoY, on good revenue growth, partially offset by higher non-interest expenses, insurance claims and PCL PCL increased by $17MM QoQ. PCL-impaired increased $19MM, primarily reflecting Canadian the higher provisions in the auto-finance, real e
Slide 22: TD Bank Group – Key Themes
TD Bank Group – Key Themes 5th largest bank by Total Assets1 1 Top 10 North American Bank 6th largest bank by Market Cap1 Delivering top tier long 2 Proven Performance term shareholder returns2 Highly rated 3 Strong Balance Sheet and Capital Position by major credit rating agencies Targeting 7-10% 4
Slide 23: Low Risk, Deposit Rich Balance Sheet
Low Risk, Deposit Rich Balance Sheet1 Funding Mix2 Wholesale Term Debt6 Trading Deposits5 10% P&C Deposits 65% Senior Unsecured MTN 49% Personal Non-Term Deposits Term Asset Backed 37% Securities Wholesale Term 4% Debt 13% Mortgage Securitization Covered Bonds 10% 25% Capital9 12% Other Deposits3 23
Slide 24: Strong Capital & Liquidity Positions
Strong Capital & Liquidity Positions Common Equity Tier 11 Highlights Common Equity Tier 1 ratio of 12.0% Q3 2018 CET1 Ratio 11.7% Internal capital generation 39 Leverage ratio of 4.2% Actuarial gain on employee pension plans 6 Organic RWA increase and other (10) Liquidity coverage ratio of 12
Slide 25: Industry-Leading Credit Ratings
Industry-Leading Credit Ratings Issuer Ratings1 Senior Debt Legacy Senior Rating Agencies Outlook Ratings2 Debt Ratings3 Moody's Aa3 Stable Aa1 S&P A Stable AA- DBRS Aa (low) Positive AA Ratings vs. Peer Group1 Moody’s Senior Debt2 / HoldCo6 Rating S&P Senior Debt2 / HoldCo6 Rating 18 Aa1 14- AA 16
Slide 26: TD Bank Group – Key Themes
TD Bank Group – Key Themes 5th largest bank by Total Assets1 1 Top 10 North American Bank 6th largest bank by Market Cap1 Delivering top tier long 2 Proven Performance term shareholder returns2 Highly rated 3 Strong Balance Sheet and Capital Position by major credit rating agencies Targeting 7-10% 4
Slide 27: Canadian Retail
Canadian Retail Consistent Strategy Reported Net Income (C$MM) $7,183 $6,525 $5,938 $5,988 How we compete $5,237 Legendary personal connected customer service Focus on underrepresented products and markets $5,490 $5,490 $5,938 $6,525 $7,183 Adjusted1 The power of One TD 2014 2015 2016 2017 201
Slide 28: Canadian Retail
Canadian Retail Personal Banking #1 or #2 market share in most retail products1 On average, 38% longer branch hours than peers2 with 346 branches offering Sunday banking Digital banking leadership in Canada with the highest number of digital unique visitors and the most digital engagement3 A
Slide 29: U.S. Retail
U.S. Retail Reported Net Income Consistent Strategy (US$MM) $3,253 How we compete $2,536 $2,007 $2,234 Legendary service and convenience $1,938 Grow and deepen customer relationships Differentiated brand as the “human” bank $1,938 $2,053 $2,234 $2,565 $3,401 Adjusted1 Productivity initiative
Slide 30: U.S. Retail
U.S. Retail Personal & Commercial Banking Top 10 bank1 with over 9MM customers, operating retail stores in 15 states and the District of Columbia Open longer than the competition, including Sunday banking in most markets #3 market share in NYC2 and targeting top 5 market share in all of our ma
Slide 31: Wholesale Banking
Wholesale Banking Consistent Strategy Net Income (C$MM) $1,039 $1,054 How we compete $920 $873 $813 Solidify our leadership in Canada Build our U.S. dollar capabilities Expand the client franchise organically by deepening client relationships, adding people, and investing in our products and s
Slide 32: Wholesale Banking
Wholesale Banking Positioned for growth Be the top ranked investment dealer in Canada with global execution capabilities by deepening client relationships #1 or #2 ranking in key domestic categories, including equity block trading and equity options block trading, government and corporate debt u
Slide 33: Investor Relations Contacts
Investor Relations Contacts Phone: 416-308-9030 or 1-866-486-4826 Email: tdir@td.com Website: www.td.com/investor
Slide 34: TD Bank Group
TD Bank Group Investor Presentation Q4 2018