Toronto-dominion Bank · TSX:TD

Toronto-dominion Bank — The Toronto-Dominion Bank — Q1 2025 Earnings Presentation

58 slides from Toronto-dominion Bank's earnings presentation, Feb 27, 2025

  1. Slide 1: Quarterly Results Presentation

    Quarterly Results Presentation TD Bank Group Q1 2025 February 27, 2025

  2. 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

  3. Slide 3: Strategic Review Update

    Strategic Review Update Adjust business Simplify the Evolve the Bank Drive efficiency mix and capital business and accelerate and operational allocation portfolio capabilities excellence Re-allocate capital and Divest or wind down Streamline operating Improve operations disproportionately invest bus

  4. Slide 4: Q1 2025 Performance

    Q1 2025 Performance Net Income EPS2 PTPP1,3 Growth (YoY) Total Assets Reported: $2.8B Reported: $1.55 Reported: 5.2% $2.1T Adjusted1: $3.6B Adjusted1: $2.02 Adjusted1: 5.7% Efficiency Ratio2 ROE2 ROTCE2 CET 14 Reported: 57.4% Reported: 10.1% Reported: 13.4% 13.1% Adjusted, Net of ISE1,2: 59.0% Adjus

  5. Slide 5: Strong Momentum Across our Businesses

    Strong Momentum Across our Businesses Canadian Personal & Commercial Banking U.S. Retail  Record revenue, PTPP, deposits and loans  AML remediation is the #1 priority  Personal Bank maintained #1 non-term market share  Executing against U.S. balance sheet restructuring and delivered strong YoY t

  6. Slide 6: Continued Adoption of our Digital Channels

    Continued Adoption of our Digital Channels Canadian P&C1 U.S. Retail1 Home & Auto Insurance Digital Adoption (% of total customers)2 +169bps +117bps 65.9 End-to-End Digital Sales (% of all transactions)6 64.2 56.1 57.2 +960 bps 42.9 Q1/24 Q1/25 Q1/24 Q1/25 33.3 Mobile Users (millions)3 +7.7% +3.5% Q

  7. Slide 7: Q1 2025 Sustainability Highlights

    Q1 2025 Sustainability Highlights  Through its 19th annual Housing for Everyone program, the TD Charitable Foundation in the U.S. announced over US$7MM in grants available to nonprofit organizations addressing the growing challenge of sustaining home ownership  Across TD's North American footprint

  8. Slide 8: U.S. AML Remediation

    U.S. AML Remediation1 We remain on track to implement the majority of remediation actions in 2025 as part of our multi-year program Talent, Governance Remaining Appointment of Implement majority Complete remaining & Structure, and implementations Monitorship of remediation Suspicious Activity Policy

  9. Slide 9: U.S. Balance Sheet Restructuring

    U.S. Balance Sheet Restructuring1 Progress Update As of January 31, total assets of ~US$402B vs. US$434B asset limitation2 ~10% Asset Reduction Investment Portfolio Repositioning  Paid down US$25B of borrowings using  ~US$13B notional sold in Q1'25 mainly cash and investment maturities in Q1'25 

  10. Slide 10: Q1 2025 Highlights

    Q1 2025 Highlights EPS of $1.55, flat YoY P&L ($MM)  Adjusted1 EPS of $2.02, up 1% YoY Reported Q1/25 QoQ YoY Revenue 14,049 (9%) 2% PTPP up 5% YoY (Adj1 up 6% YoY, excl. U.S. Strategic Insurance Service Expenses Card Portfolio partners' share (SCP), FX, & ISE) (ISE) 1,507 (36%) 10% PCL Revenue up

  11. Slide 11: Canadian Personal & Commercial Banking

    Canadian Personal & Commercial Banking Record revenue with continued volume growth P&L ($MM) Reported Q1/25 QoQ YoY Net income up 3% YoY; PTPP up 6% YoY Revenue 5,149 2% 5% Revenue up 5% YoY PCL 521 +$91 +$98  Volume growth Impaired 459 +$3 +$95  Loan volumes up 4% Performing 62 +$88 +$3  Deposit

  12. Slide 12: U.S. Retail

    U.S. Retail Continued momentum and progress P&L (US$MM) (except where noted) on balance sheet restructuring Reported Q1/25 QoQ YoY Net income down 62% (Adj1 down 15%) Revenue 1,962 (17%) (24%) PCL 318 +$33 +$33 PTPP down 63% (Adj1 down 12%) Impaired 371 +$65 +$92 Revenue down 24% YoY (Adj1 up 1%) Pe

  13. Slide 13: Wealth Management & Insurance

    Wealth Management & Insurance Record Wealth revenue, strong P&L ($MM) Insurance premium growth Reported Q1/25 QoQ YoY Net income up 23% YoY; PTPP up 27% YoY Revenue 3,598 (9%) 15% Insurance Service Expenses 1,507 (36%) 10% Revenue up 15% YoY (ISE) Revenue, net of ISE 2,091 33% 18%  Wealth Managemen

  14. Slide 14: Wholesale Banking

    Wholesale Banking Record revenue driven by Global Markets business P&L ($MM) Reported Q1/25 QoQ YoY Net income up 46% YoY (Adj1 up 14% YoY) Revenue 2,000 13% 12% PTPP up 66% (Adj1 up 30%) Global Markets 1,279 28% 17% Investment Banking 744 (1%) 5% Revenue up 12% YoY PCL 72 -$62 +$62 Impaired 33 -$10

  15. Slide 15: Corporate Segment

    Corporate Segment Reported net loss of $359MM P&L ($MM)  Adjusted1 loss of $266MM Reported Q1/25 Q4/24 Q1/24 Net Income (Loss) (359) 526 (591) Adjustments for items of note Amortization of acquired intangibles2 61 60 94 Acquisition and integration charges related to - 35 32 the Schwab transaction3

  16. Slide 16: Capital

    Capital1 Strong capital and liquidity QoQ CET 1 ratio management 56 bps CET 1 ratio 13.1%, up 2 bps QoQ (29) bps (2) bps (15) bps  Strong internal capital generation, +27 bps (8) bps (0) bps offset by RWA growth (excl. FX) and Adjusted Internal impact from U.S. balance sheet Capital Generation 13.1

  17. Slide 17: Gross Impaired Loan Formations

    Gross Impaired Loan Formations By Business Segment GIL Formations1: $MM and Ratios2 Highlights 22 21 22 28 25 bps  Gross impaired loan formations decreased 3 basis points quarter- over-quarter, reflected in: $2,657 $2,432 – The Business & Government $292 / lending portfolios $123 / 12 bps 30 bps $2

  18. Slide 18: Gross Impaired Loans (GIL)

    Gross Impaired Loans (GIL) By Business Segment GIL: $MM and Ratios1 Highlights 52 56 bps  Gross impaired loans 41 44 increased quarter-over- 40 quarter, driven by: $5,453 ‒ The consumer and $5 / 6 bps $4,949 Business & Government $5 / 6 bps lending portfolios $421 / $4,170 41 bps ‒ The impact of fo

  19. Slide 19: Provision for Credit Losses (PCL)

    Provision for Credit Losses (PCL) By Business Segment PCL: $MM and Ratios1,2,3 Highlights Wealth Management & Insurance  PCL increase quarter-over- Wholesale Banking quarter, largely reflected in: $1,212 Canadian Personal & Commercial Banking $1,072 $1,109 – Canadian Personal & $1,071 $72 U.S. Reta

  20. Slide 20: Provision for Credit Losses (PCL): Impaired and Performing

    Provision for Credit Losses (PCL) Impaired and Performing PCL1 ($MM) Highlights Q1/24 Q4/24 Q1/25  Impaired PCL increase Total Bank 1,001 1,109 1,212 quarter-over-quarter largely Impaired 934 1,153 1,216 recorded in the U.S. Cards portfolio Performing 67 (44) (4) Canadian Personal & Commercial Bank

  21. Slide 21: Allowance for Credit Losses (ACL)

    Allowance for Credit Losses (ACL) ACL1,2: $B and Coverage Ratios3 Highlights  ACL increased $457 million 99 bps quarter-over-quarter, related to: 93 95 91 United States 74 89 – The impact of foreign Canada $9.1 $9.6 exchange $8.6 $8.8 $8.3 – Overlays in the Business 56% 56% 57% and Government lendi

  22. Slide 22: Appendix

    Appendix 22

  23. Slide 23: Q1 2025: Items of Note

    Q1 2025: Items of Note Revenue/ ($MM) EPS ($) Segment Expense Line Item1 Pre-Tax After Tax Reported net income and EPS (diluted) 2,793 1.55 Items of note Amortization of acquired intangibles2 61 52 0.03 Corporate Page 4, L13, L29 & L44 Acquisition and integration charges related to the Cowen acquisi

  24. Slide 24: U.S. Strategic Card Portfolio: Accounting

    U.S. Strategic Card Portfolio: Accounting Illustrative Example Values below are shown for illustrative purposes only. The percent share is representative of the agreements with the retailer card partners, but the exact split differs by partner. Illustrative Example $MM Credit Card Portfolio 1,000 Me

  25. Slide 25: Q1 2025: PTPP & Operating Leverage

    Q1 2025: PTPP & Operating Leverage1,2 Modified for partners' share of SCP PCL, FX and Insurance Service Expense Q1 2025 Q4 2024 Q1 2024 TOTAL BANK SFI Reference Revenue Expenses Revenue Expenses Revenue Expenses Reported Results ($MM) 14,049 8,070 15,514 8,050 13,714 8,030 Page 2, L3 & L6 1 PTPP 5,9

  26. Slide 26: Net Interest Income Sensitivity (NIIS)

    Net Interest Income Sensitivity (NIIS) Strong deposit base and disciplined ALM management 25 bps change in short-term interest rates 100 bps change in interest rates across the curve  25 bps increase: $51MM increase in NII over a 12-month  100 bps increase: $597MM increase in NII over a 12-month p

  27. Slide 27: Expense Growth Profile

    Expense Growth Profile Reported Expenses ($MM) Reported Expense Growth ($MM) 11,012 8,030 8,401 8,050 8,070 8,030 Expenses relatively flat YoY 8,070 Q1/24 Q2/24 Q3/24 Q4/24 Q1/25 Q1/24 Q1/25 Adjusted1 Expenses ($MM) Adjusted1 Expense Growth ($MM) Adjusted1 Expenses up 12% YoY (~1/3 driven by variabl

  28. Slide 28: Customer Activity

    Customer Activity Canadian Personal and Commercial U.S. Retail Average Volumes Global Wealth Assets2 Banking Average Volumes ($B) (US$B)1 ($B) 2 Year CAGR 12% 6% 300 600 4% 1,200 126 250 -1% 500 119 1,000 749 110 200 109 105 6% 101 400 441 158 458 170 800 591 629 414 162 150 96 95 300 90 600 279 296

  29. Slide 29: Continued Progress on 2023 Investor Day Targets

    Continued Progress on 2023 Investor Day Targets Canadian Personal Bank Outgrow Canada's Population –  Achieved this target in F'24 50% Growth in New to Canada Acquisition1 ​#1 Core Deposits Market  Maintained #1 core deposits market share Share2  Largest customer base in Canada with over 8MM acti

  30. Slide 30: Continued Progress on 2023 Investor Day Targets

    Continued Progress on 2023 Investor Day Targets Wealth Management  #1 institutional market share among Big 5 Banks1 Asset Management - #1  Among the industry's fastest growing ETF franchises, leading Big 5 Banks in Institutional Market Share1 and $80B Net Asset Growth market share growth1  Expand

  31. Slide 31: Canadian Personal & Commercial Banking

    Canadian Personal & Commercial Banking Margins, Volumes and Efficiency Net Interest Margin (NIM) Average Loans ($B)1 560 564 572 578 583 2.84% 2.84% 119 121 122 123 126 2.81% 2.80% 2.81% 441 444 450 454 458 Q1/24 Q2/24 Q3/24 Q4/24 Q1/25 Q1/24 Q2/24 Q3/24 Q4/24 Q1/25 Personal Business Efficiency Rati

  32. Slide 32: U.S. Retail

    U.S. Retail Margins, Volumes and Efficiency Net Interest Margin (NIM)1,2 Average Loans (US$B)3 191 192 193 193 193 96 98 97 96 95 3.03% 2.99% 3.02% 3.01% 3.05% 2.86% 95 95 96 97 98 2.77% Q1/24 Q2/24 Q3/24 Q4/24 Q1/25 Q1/24 Q2/24 Q3/24 Q4/24 Q1/25 NIM Excl. Liquidity Actions Personal Business Efficie

  33. Slide 33: U.S. Retail

    U.S. Retail Wealth Assets (US$B) Schwab EPU Schwab1 – Q1 2025 52 TD’s share of Schwab’s net income was C$231MM on a 51 49 reported basis, of which C$199MM (US$142MM) was 47 47 8 9 recorded in the U.S. Retail segment 8 7 7  TD's share of Schwab's net income was C$257MM on an adjusted2 basis Schwab Q

  34. Slide 34: Schwab Equity Pickup

    Schwab Equity Pickup Q1 2025 Reconciliation U.S. Retail P&L ($MM)1 TDBG Corporate Segment $C $US Reported Schwab Equity Pickup2 231 199 142 32 Amortization of acquired intangibles3 26 0 0 26 Adjusted4 Schwab Equity Pickup 257 199 142 58 Financial Statement Reference TDBG U.S. Retail Corporate Segmen

  35. Slide 35: Wealth Management & Insurance

    Wealth Management & Insurance Volumes and Efficiency Insurance Premiums ($MM) Average AverageLoans Loans($B) $B 1,853 1,831 7.4 1,337 1,460 1,514 6.4 6.7 6.9 6.2 Q1/24 Q2/24 Q3/24 Q4/24 Q1/25 Q1/24 Q2/24 Q3/24 Q4/24 Q1/25 Efficiency Ratio Average AverageDeposits Deposits($B) $B 70.4% 65.7% 59.2% 56.

  36. Slide 36: Wealth Management & Insurance

    Wealth Management & Insurance Wealth Revenue ($MM) Wealth Assets ($B) 1,738 600 1,558 1,594 1,600 287 1,481 1,409 687 236 233 651 217 632 201 240 596 198 576 556 1,200 188 500 185 523 530 157 512 489 479 448 800 415 418 400 355 400 1,137 1,211 1,079 1,160 1,051 0 300 Q1/24 Q2/24 Q3/24 Q4/24 Q1/25 Q1

  37. Slide 37: Wholesale Banking

    Wholesale Banking Revenue Loans1 Q1 2025 Q1 2025 -1% 4% 37% 34% $2.0B $100.9B 64% 62% Corporate and Canada United States International Global Markets Other2 Investment Banking 37

  38. Slide 38: Gross Lending Portfolio

    Gross Lending Portfolio Period-End Balances ($B unless otherwise noted) Q4/24 Q1/25 Canadian Personal and Commercial Portfolio 583.1 587.0 Personal 457.0 457.9 Residential Mortgages 270.9 270.5 Home Equity Lines of Credit (HELOC) 123.0 124.2 Indirect Auto 29.9 30.1 Credit Cards 20.5 20.4 Other Perso

  39. Slide 39: Commercial Real Estate (CRE)

    Commercial Real Estate (CRE) Commercial Real Estate Portfolio Overview: Highlights $99B  Commercial Real Estate represents $99B or 10% of Total Bank gross loans1 – Portfolio is well diversified across Office Retail geographies and sub segments 10% 18% – 55% of CRE portfolio in Canada and Other 5% 4

  40. Slide 40: Canadian Real Estate Secured Lending Portfolio

    Canadian Real Estate Highlights Secured Lending Portfolio  Total Canadian real estate secured lending portfolio at $397B Maturity Schedule ($B)1 – 91% of RESL portfolio is amortizing4, of $111.9 which 72% of HELOC portfolio is Variable Rate $110.6 $29.2 amortizing Fixed Rate $45.1 $55.1 – 36% varia

  41. Slide 41: Canadian Personal Banking

    Canadian Personal Banking Canadian Personal Banking (Q1/25)1 Highlights Gross Loans ($B) GIL ($MM) GIL/Loans (%)  Some increase in gross Residential Mortgages 270.5 322 0.12 impaired loans quarter-over- Home Equity Lines of Credit (HELOC) 124.2 189 0.15 quarter as we progress Indirect Auto 30.1 146

  42. Slide 42: Canadian Commercial and Wholesale Banking

    Canadian Commercial and Wholesale Banking Canadian Commercial and Wholesale Banking (Q1/25) Highlights Gross Loans GIL GIL/Loans ($B) ($MM) (%)  Gross impaired loans Commercial Banking1 129.1 1,119 0.87 increased quarter-over- Wholesale Banking 101.7 421 0.41 quarter, primarily related to a few new

  43. Slide 43: U.S. Personal Banking

    U.S. Personal Banking U.S. Personal Banking (Q1/25) Highlights Gross Loans GIL GIL/Loans In USD unless otherwise specified ($B) ($MM) (%)  Continued good asset quality Residential Mortgages 42.2 391 0.93 in U.S. Personal Banking Home Equity Lines of Credit (HELOC)1 8.4 210 2.50 Indirect Auto 30.8 2

  44. Slide 44: U.S. Commercial Banking

    U.S. Commercial Banking U.S. Commercial Banking (Q1/25) Highlights Gross Loans GIL GIL/Loans In USD unless otherwise specified ($B) ($MM) (%)  Gross impaired loans Commercial Real Estate (CRE) 29.2 517 1.77 increased quarter-over- Non-residential Real Estate 19.4 336 1.73 quarter, driven by a few R

  45. Slide 45: Provision for Credit Losses – Impaired

    Provision for Credit Losses – Impaired1 By Geographic Location Canada U.S. Total Bank Impaired PCL Rate - Personal 0.30% 1.60% 0.59% 0.28% 1.48% 1.36% 0.52% 0.50% 0.49% 0.25% 0.25% 0.24% 1.29% 1.26% 0.47% Q1/24 Q2/24 Q3/24 Q4/24 Q1/25 Q1/24 Q2/24 Q3/24 Q4/24 Q1/25 Q1/24 Q2/24 Q3/24 Q4/24 Q1/25 Canad

  46. Slide 46: Endnotes on Slides 3-4

    Endnotes on Slides 3-4 Slide 3 1. The Bank’s ability to successfully dispose of the assets is subject to inherent risks and uncertainty and there is no guarantee that the Bank will be able to sell the assets in the timeline outlined or achieve the purchase price which it currently expects. The abili

  47. Slide 47: Endnotes on Slides 5-6

    Endnotes on Slides 5-6 Slide 5 1. As measured by OSFI market share data. 2. Based on the Brand Finance Global 500 2025 report. 3. Loan portfolios identified for sale or run-off include correspondent lending, residential jumbo mortgage, export and import lending, commercial auto dealer portfolio, and

  48. Slide 48: Endnotes on Slides 8-9

    Endnotes on Slides 8-9 Slide 8 1. Year references represent calendar years. 2. As previously disclosed in the Bank’s 2024 MD&A, on October 10, 2024, the Bank announced that, following active cooperation and engagement with authorities and regulators, it reached a resolution of previously disclosed i

  49. Slide 49: Endnotes on Slides 10-11

    Endnotes on Slides 10-11 Slide 10 1. Please refer to Slide 4, Endnote 1. 2. The Bank’s expectations regarding expense growth are based on the Bank’s assumptions regarding certain factors, including risk and control investments, employee-related expenses, foreign exchange impact, gross-up of the reta

  50. Slide 50: Endnotes on Slides 12-14

    Endnotes on Slides 12-14 Slide 12 1. Please refer to Slide 4, Endnote 1. 2. Net interest margin is calculated by dividing U.S. Retail segment’s net interest income by average interest-earning assets. For the U.S. Retail segment, this calculation excludes the impact related to sweep deposits arrangem

  51. Slide 51: Endnotes on Slides 15-18

    Endnotes on Slides 15-18 Slide 15 1. Please refer to Slide 4, Endnote 1. 2. Amortization of acquired intangibles relates to intangibles acquired as a result of asset acquisitions and business combinations, including the after-tax amounts for amortization of acquired intangibles relating to the share

  52. Slide 52: Endnotes on Slides 19-23

    Endnotes on Slides 19-23 Slide 19 1. PCL Ratio: Provision for Credit Losses on a quarterly annualized basis/Average Net Loans & Acceptances. 2. Net Total Bank and U.S. Retail PCL ratios exclude credit losses associated with the retailer program partners' share of the U.S. Strategic Cards Portfolio,

  53. Slide 53: Endnotes on Slides 25-28

    Endnotes on Slides 25-28 Slide 25 1. Please refer to Slide 4, Endnote 1. 2. Operating leverage is a non-GAAP measure. At the total Bank level, TD calculates operating leverage as the difference between the % change in adjusted revenue (U.S. Retail in source currency) net of insurance service expense

  54. Slide 54: Endnotes on Slides 29-32

    Endnotes on Slides 29-32 Slide 29 . 1. 50% growth in annual New-to-Canada acquisition relative to 2022, measured by Chequing Account sales units. 2. As measured by OSFI 'non-term' market share data. 3. Based on credit card outstanding balances. 4. Portfolio balances. 5. Spot basis. Business loan vol

  55. Slide 55: Endnotes on Slides 33-37

    Endnotes on Slides 33-37 Slide 33 1. TD's share of net income in US$ is the corresponding C$ net income contribution of Schwab to the U.S. Retail segment included in the Bank's Q1 2025 Report to Shareholders for the relevant quarters, divided by the average FX rate. For additional information, pleas

  56. Slide 56: Endnotes on Slides 38-40

    Endnotes on Slides 38-40 Slide 38 1. U.S. HELOC includes Home Equity Lines of Credit and Home Equity Loans. 2. Includes acquired credit impaired loans and loans booked in the Corporate segment. 3. Includes loans measured at fair value through other comprehensive income. Slide 39 1. Gross Loans outst

  57. Slide 57: Endnotes on Slides 41-45

    Endnotes on Slides 41-45 Slide 41 1. Excludes Wealth Management & Insurance segment and Wholesale mortgage portfolio. 2. Please refer to Slide 40, Endnote 2. 3. Please refer to Slide 40, Endnote 3. Slide 42 1. Includes Small Business Banking and Business Credit Cards. 2. Consumer includes: Food, Bev

  58. Slide 58: Investor Relations Contacts

    Investor Relations Contacts Phone: (416) 308-9030 or 1 (866) 486-4826 Email: tdir@td.com Website: www.td.com/investor 58

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