Toronto-dominion Bank · TSX:TD
Toronto-dominion Bank — TD Bank Group — Q2 2015 Earnings Presentation
30 slides from Toronto-dominion Bank's earnings presentation, May 28, 2015
Slide 1: TD Bank Group Quarterly Results Presentation Q2 2015
TD Bank Group Quarterly Results Presentation Q2 2015 Thursday May 28th, 2015
Slide 2: Caution Regarding Forward-Looking Statements
Caution Regarding Forward-Looking Statements From time to time, the Bank 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 in other communications. In a
Slide 3: Strategic Overview
Strategic Overview Solid financial results in Q2 2015 Adjusted1 earnings of $2.2B, up 5% YoY; Adjusted EPS up 5% YoY Good results in Canadian and U.S. Retail; strong quarter for Wholesale Restructuring charge announced 1. The Bank prepares its consolidated financial statements in accordance
Slide 4: Q2 2015 Highlights
Q2 2015 Highlights Key Themes Financial Highlights $MM Adjusted1 EPS of $1.14, up 5% YoY P&L Summary Adjusted1 Adjusted Net Income up 5% from Q2/14 Adjusted1 Q2/15 Q1/15 Q2/14 Good contribution from Retail businesses Revenue2 $ 7,178 6,915 6,776 Strong Wholesale performance Expenses 4,243 4,
Slide 5: Q2 2015 Earnings: Items of Note
Q2 2015 Earnings: Items of Note MM EPS Reported net income and EPS (diluted) $1,859 $0.97 Pre Tax After Tax Items of Note EPS (MM) (MM) Amortization of intangibles1 $73 $65 $0.04 Restructuring charges2 $337 $228 $0.12 Litigation and litigation-related charge/reserve3 $52 $32 $0.02 Fair value of deri
Slide 6: Canadian Retail
Canadian Retail Key Themes P&L $MM Adjusted, where applicable1 Adjusted1 net income up 6% YoY Q2/15 QoQ YoY Strong contribution from Banking, Wealth and Insurance Revenue $ 4,778 -2% 2% Insurance Claims 564 -19% -14% Revenue up 2% YoY PCL 239 26% 0% Good volume and wealth asset growth, credi
Slide 7: U.S. Retail
U.S. Retail Key Themes P&L US$MM Adjusted, where applicable1 Q2/15 QoQ YoY Adjusted1 net income up 1% YoY Revenue $ 1,853 -3% -2% Revenue down 2% YoY PCL 104 -32% -33% Relating to Target and lower security gains2 Expenses (adjusted) 1,223 3% 1% Strong volume and fee growth offset by margin E
Slide 8: Wholesale Banking
Wholesale Banking Key Themes P&L $MM Net income up 19% YoY Q2/15 QoQ YoY Revenue $ 784 10% 16% Revenue up 16% YoY PCL 0 NA NA Broad-based contribution from trading, Expenses 447 3% 10% equity and debt underwriting and strong corporate lending growth Net Income $ 246 28% 19% ROE 17.7% Expense
Slide 9: Corporate Segment
Corporate Segment Key Themes P&L $MM Adjusted, where applicable1 Adjusted1 net income down Q2/15 Q1/15 Q2/14 $109MM YoY Net Corporate Expenses $ (177) $ (172) $ (159) Reflects the prior year gain on sale of Other 10 2 103 TD Ameritrade shares and lower Non-Controlling Interests 28 27 26 favourab
Slide 10: Capital & Liquidity
Capital & Liquidity Highlights Basel III Common Equity Tier 11 Basel III Common Equity Tier 1 ratio 9.9% 9.9% Increase QoQ reflects solid 9.3% 9.4% 9.5% 9.2% organic capital generation and RWA reductions, primarily in Wholesale Leverage ratio of 3.7% Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Liquidity c
Slide 11: Restructuring Charge
Restructuring Charge The restructuring charge is the result of a comprehensive review of parts of TD's operating businesses and corporate functions with the objective of improving customer service, reducing organizational complexity and improving efficiency and effectiveness. Three overall areas of
Slide 12: Credit Portfolio Highlights
Credit Portfolio Highlights Highlights PCL Ratio (bps)1 Ongoing strong performance 35 across all portfolios 33 32 Loss rates remain at cyclically low levels 29 PCL and GIL ratios continue to exhibit a 28 stable trend Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 GIL Ratio (bps)2 59 57 56 56 55 Great quarter o
Slide 13: Appendix
Appendix
Slide 14: Q2 2015 Earnings: Items of Note
Q2 2015 Earnings: Items of Note MM EPS Reported net income and EPS (diluted) $1,859 $0.97 Revenue/ Pre Tax After Tax Items of note EPS Segment Expense (MM) (MM) Line Item5 Amortization of intangibles1 $73 $65 $0.04 Corporate pg 9, line 10 Restructuring charges2 $337 $228 $0.12 Corporate pg 9, line 1
Slide 15: Canadian Retail Metrics
Canadian Retail Metrics Net Interest Margin Average Deposits $B 247 250 255 259 260 On Average Earning Assets 17 17 18 18 19 76 78 81 83 81 2.97% 2.98% 2.92% 2.88% 2.89% 154 155 157 158 160 On Loans Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Personal Business Wealth 2.00% 2.00% 2.01% 1.97% 1.94% Average Loans $B
Slide 16: Canadian Wealth
Canadian Wealth Wealth Revenue1 Wealth Retail vs. Institutional AUM2 $MM $B 837 841 856 825 127 786 116 118 112 115 112 131 121 121 139 129 124 145 117 115 114 113 112 111 108 571 592 599 613 529 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Wealth Fee & Other Wealth Transaction Wealth
Slide 17: US Retail
US Retail Loans and Deposit Growth Average Deposits Average Loans US$B US$B 117 119 200 201 204 111 114 195 195 108 75 75 75 73 72 58 61 63 54 56 55 55 57 57 57 54 55 56 56 56 67 68 68 69 72 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 1 Personal Business TD Ameritrade IDAs Personal C
Slide 18: TD Ameritrade
TD Ameritrade Highlights TD Bank Group’s Share of TD Ameritrade’s Net Income1 TD’s share of TD Ameritrade’s net US$MM income was C$85 MM in Q2/15, up 9% YoY mainly due to: FX translation partially offset by lower earnings in TD Ameritrade $79 $77 $70 $69 $69 TD Ameritrade Results Net income US
Slide 19: Liquidity Coverage Ratio (LCR)
Liquidity Coverage Ratio (LCR) New Q2 2015 Disclosure What is it? LCR measures a bank’s ability to withstand a liquidity crisis under a severe stress scenario. In other words, does a Bank have sufficient high quality liquid assets (HQLA) to cover projected stressed cash outflows in a thirty day pe
Slide 20: Canadian Housing Market
Canadian Housing Market Portfolio Q2/15 Gross Loans Outstanding $236 B Canadian RESL Percentage Insured 60% Uninsured Residential Mortgages Current LTV1 60% Condo Borrower Gross Loans Outstanding $30 B (Residential Mortgages) Percentage Insured 70% Gross Loans Outstanding $6 B Condo Borrower 37% (HE
Slide 21: Gross Lending Portfolio
Gross Lending Portfolio Includes B/As Balances (C$B unless otherwise noted) Q1/15 Q2/15 Canadian Retail Portfolio $ 339.6 $ 342.4 Personal $ 285.6 $ 287.2 Residential Mortgages 175.3 175.5 Home Equity Lines of Credit (HELOC) 59.7 60.3 Indirect Auto 16.9 17.5 Unsecured Lines of Credit 9.2 9.3 Credit
Slide 22: Gross Impaired Loan Formations
Gross Impaired Loan Formations By Portfolio GIL Formations1: $MM and Ratios2 Highlights Decrease in GIL formations $1,163 $1,168 largely due to improvements in $1,125 $1,092 $1,124 $16 / 5 bps Canadian Real Estate Secured Lending $403 / 34 bps $397 / 33 bps $452 / 36 bps $466 / 34 bps Wholesale
Slide 23: Gross Impaired Loans (GIL)
Gross Impaired Loans (GIL) By Portfolio GIL1: $MM and Ratios2 Highlights GIL are stable across the $2,967 $2,905 portfolio $2,746 $2,731 $13 / 4 bps $28 / 9 bps $2,636 $41 / 18 bps $12 / 5 bps $21 / 9 bps $1,849 / 124 bps $1,801 / 124 bps $1,523 / 130 bps $1,607 / 126 bps $1,489 / 124 bps $1,182 /
Slide 24: Provision for Credit Losses (PCL)
Provision for Credit Losses (PCL) By Portfolio PCL1: $MM and Ratios2 Highlights PCL remains at low levels Canadian PCL increase is a return to typical run rate after the $395 $397 $396 Q1 debt sale $3 / NM $368 $329 $6 / NM $ 3 / NM $174 / 62 bps $164 / 53 bps $152 / 43 bps $119 / 40 bps $183 /
Slide 25: Canadian Personal Banking
Canadian Personal Banking Q2/15 Canadian Personal Banking1 Gross Loans ($B) GIL/ Loans GIL ($MM) PCL2 ($MM) Highlights Residential Mortgages 176 0.25% 437 10 Credit quality remains strong in Home Equity Lines of Credit (HELOC) 60 0.40% 242 2 the Canadian Personal portfolio Indirect Auto 17 0.25% 4
Slide 26: Canadian Commercial and Wholesale Banking
Canadian Commercial and Wholesale Banking Q2/15 Gross Highlights Canadian Commercial and Loans/BAs GIL PCL1 Wholesale Banking ($B) ($MM) ($MM) Canadian Commercial and Commercial Banking2 55 126 12 Wholesale Banking portfolios Wholesale 31 28 (1) continue to perform well Total Canadian Commercial a
Slide 27: U.S. Personal Banking - U.S. Dollars
U.S. Personal Banking- U.S. Dollars Q2/15 Highlights Gross Loans GIL/ GIL U.S. Personal Banking1 PCL2 ($B) Loans ($MM) ($MM) Continued good asset quality Residential Mortgages 21 1.37% 285 12 in U.S. Personal Home Equity Lines of Credit (HELOC)3 10 3.88% 400 0 Increased GIL mainly due to Indirec
Slide 28: U.S. Commercial Banking - U.S. Dollars
U.S. Commercial Banking - U.S. Dollars Q2/15 U.S. Commercial Banking1 Gross Loans/BAs GIL ($MM) PCL2 ($MM) Highlights ($B) Commercial Real Estate (CRE) 17 230 0 Sustained strong portfolio Non-residential Real Estate 13 160 4 quality in U.S. Commercial Residential Real Estate 4 70 (4) Banking Comme
Slide 29: Investor Relations Contacts
Investor Relations Contacts Phone: 416-308-9030 or 1-866-486-4826 Email: Grand Prix for Best Overall Investor Relations: Large Cap tdir@td.com Best Investor Relations by Sector: Financial Services Website: Best Investor Relations www.td.com/investor by a CFO: Large Cap Best Investor Relations Office
Slide 30: TD Bank Group Quarterly Results Presentation Q2 2015
TD Bank Group Quarterly Results Presentation Q2 2015 Thursday May 28th, 2015