Toronto-dominion Bank · TSX:TD
Toronto-dominion Bank — TD Bank Group — Q4 2013 Earnings Presentation
36 slides from Toronto-dominion Bank's earnings presentation, 2013
Slide 1: TD Bank Group Investor Presentation Q4 2013
TD Bank Group Investor Presentation Q4 2013
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 U.S. Securities and Exchange Commission, and in other communications. In addition, representativ
Slide 3: TD Bank Group – Key Messages
TD Bank Group – Key Messages 5th largest bank 1 Top 10 Retail Focused North American Bank by Total Assets1 6th largest bank by Market Cap1 Delivering top tier long 2 Proven Performance term shareholder returns Highly rated by all 3 Strong Balance Sheet and Capital Position major credit rating agenci
Slide 4: TD Bank Group
TD Bank Group Our Businesses Canadian Personal & Commercial Personal banking, credit cards and auto finance Small business and commercial banking Wealth & Insurance Direct investing Advice-based wealth business Asset management 2,496 Insurance Business Locations1 U.S. Personal & Commerci
Slide 5: Simple Strategy, Consistent Focus
Simple Strategy, Consistent Focus Building the Better Bank North America Top 10 Bank in North America1 Leverage platform and brand for growth One of only a few banks globally to be rated Aa1 by Moody’s2 Strong employment brand Retail Earnings Focus Leader in customer service and convenienc
Slide 6: Competing in Attractive Markets
Competing in Attractive Markets Country Statistics Country Statistics 10th largest economy World’s largest economy Nominal GDP of C$1.7 trillion Nominal GDP of US$15.1 trillion Population of 35 million Population of 314 million Canadian Banking System U.S. Banking System Soundest banki
Slide 7: TD Bank Group in North America
TD Bank Group in North America Compared to: Q4 2013 North Canadian (C$) American Peers4 Peers5 Total Assets $863B 1st 5th Total Deposits $544B 2nd 6th Market Cap (as of October 31, 2013) $88B 2nd 6th Adjusted Net Income1 (Trailing 4 Quarters) $7.2B 2nd 6th Reported Net Income (Trailing 4 Quarters) $
Slide 8: Composition of Earnings
Composition of Earnings Highlights TD is a top 10 bank in North America1 Increasing retail focus Strength of retail franchise Reliable and steady earnings mix 3,4 Adjusted Retail Earnings2,5 4 $7,158 Wholesale Earnings 4 13% 9% 91% $2,158 42% 2013 Adjusted Retail Earnings2,5 = 91% 58% 2001 2
Slide 9: Evolution of TD
Evolution of TD Building Franchise Businesses >>> Increasing Retail focus >>> Acquired Acquired Target credit TD Chrysler card portfolio Waterhouse Financial & Epoch and TD Bank Acquired Acquired USA/ Privatized Acquired Commerce Acquired and MBNA announced and Canada Newcrest 51% of Ameritrade TD C
Slide 10: Risk Management Framework
Risk Management Framework Our Risk Appetite We take risks required to build our business, but only if those risks: Fit our business strategy and can be understood and managed Do not expose the enterprise to any significant single loss events; we don’t “bet the bank” on any single acquisition, bu
Slide 11: TD Bank Group – Key Messages: Proven Performance
TD Bank Group – Key Messages 1 Top 10 Retail Focused North American Bank1 2 Proven Performance 3 Strong Balance Sheet and Capital Position 4 Focused on Growth Opportunities 10 1. See slide 6.
Slide 12: Solid Growth and Returns Across Businesses
Solid Growth and Returns Across Businesses Adjusted Earnings1,2 (C$MM) $7,075 $7,158 $6,432 $5,228 $4,716 $3,813 Wholesale Banking U.S. P&C Wealth & Insurance2 Canadian P&C2 2008 2009 2010 2011 2012 2013 Adjusted Retail Earnings as % of 98% 78% 83% 87% 88% 91% Adjusted Earnings Targeting 7-10% adjus
Slide 13: Strong Total Shareholder Returns
Strong Total Shareholder Returns Total Shareholder Return (CAGR1) CDN Peers2 NA Peers3 27.5% 23.8% 22.3% 15.2% 15.9% 13.1% 12.5% 11.7% 11.9% 10.7% 6.9% 5.0% 1 Year 3 Years 5 Years 10 Years Delivering top tier long-term shareholder returns 1. Compounded Annual Growth Rates (CAGRs) for all periods end
Slide 14: Strong, Consistent Dividend History
Strong, Consistent Dividend History Dividends Per Share (C$) Q4/13: $3.24 Announced Stock Dividend with 2:1 Split Effect1 Dividend Yield: 3.5%2 $0.38 Q3/12: Increased Target Payout Range to 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 40%-5
Slide 15: Q4 2013 Highlights
Q4 2013 Highlights Key Themes Net Income $MM (Adjusted, where applicable) Adjusted1 EPS growth of 4% YoY Q4/13 QoQ YoY Retail2 $ 1,752 21% 19% Retail earnings up 19% Wholesale 122 -17% -61% Strong loan and deposit volume growth in Canada and the U.S. Corporate (53) n/a -83% Adjusted Net Income
Slide 16: Q4 2013 Operating Highlights
Q4 2013 Operating Highlights Key Themes by Segment Adjusted earnings1 up 14% YoY Good volume growth, Lending volumes strong in business banking, solid but slowing Canadian expense control and in personal strong credit P&C Adjusted expenses flat YoY performance Strong credit performance: pers
Slide 17: Q4 2013 Credit Highlights
Q4 2013 Credit Highlights Highlights PCL Ratio (bps)1 Strong credit performance Loss rates for Canadian P&C remain historically low Continued improvement in the U.S. Personal and Commercial portfolios Performance expected to continue through 2014 Release of $40MM of Alberta flood related r
Slide 18: TD Bank Group – Key Messages: Strong Balance Sheet
TD Bank Group – Key Messages 1 Top 10 Retail Focused North American Bank1 2 Proven Performance 3 Strong Balance Sheet and Capital Position 4 Focused on Growth Opportunities 17 1. See slide 6.
Slide 19: Attractive Balance Sheet Composition
Attractive Balance Sheet Composition1 Funding Mix2 Wholesale Term Debt Assets Securitized 54% Other Deposits 3 Personal Term Deposits 26% 8% Residential Residential Mortgages Mortgages 52%58% Short Term Liabilities4 Covered Bonds 11% 14% Personal Non‐ Wholesale Term Covered Bonds Term Deposits Debt
Slide 20: Strong Capital Position
Strong Capital Position Highlights Basel III Common Equity Tier 11 Basel III Common Equity Tier 1 ratio 9.0% as of October 31, 2013 Announced stock dividend with 2-for-1 stock split effect in January During fiscal 2013 we repurchased 9 million shares under buyback program Dividends paid up 1
Slide 21: Strong Focus on Risk-Adjusted Return
Strong Focus on Risk-Adjusted Return Citations Adjusted Return on Risk-Weighted Assets1 Global Finance magazine ranked TD as the Safest Bank in North 2.43% 2.33% America and one of the World’s 50 Safest Banks in 2013 1.57% Bloomberg Markets magazine ranked TD as one of the world’s strongest bank
Slide 22: Gross Lending Portfolio
Gross Lending Portfolio Balances Highlights C$B (unless otherwise noted) Q4/13 Canadian Personal & Commercial Portfolio $ 314.6 Canadian portfolio – strong credit quality Personal $ 267.6 Residential Mortgages 164.7 Real estate secured lending volume up 4% YoY Home Equity Lines of Credit (HELOC) 6
Slide 23: TD Bank Group – Key Messages: Growth Opportunities
TD Bank Group – Key Messages 1 Top 10 Retail Focused North American Bank1 2 Proven Performance 3 Strong Balance Sheet and Capital Position 4 Focused on Growth Opportunities 22 1. See slide 6.
Slide 24: Canadian Personal & Commercial Banking
Canadian Personal & Commercial Banking Consistent Strategy Adjusted Net Income1 (C$MM) $3,766 $3,408 Where we compete $3,095 $3,051 $2,424 $2,472 Continue to win in retail banking Higher growth opportunities Business banking Credit cards Auto lending 2008 2009 2010 2011 2012 2013 How we wi
Slide 25: Canadian Personal & Commercial Banking
Canadian Personal & Commercial Banking Leaders in customer service and convenience TD has opened approximately 1 out of every 3 new branches1 On average 45% longer branch hours than peers2 Sunday banking in more than 425 branches Integrated product offerings #1 or #2 market share in most ret
Slide 26: Wealth & Insurance
Wealth & Insurance Consistent Strategy Net Income1 (C$MM) $1,367 $1,314 $1,153 Where we compete $557 $541 $216 Wealth $769 $246 $641 $209 Mass affluent and high net worth TD clients in $289 $597 $207 Canada and U.S. $194 $252 Self-directed investors in selected markets $566 $601 $691 $480 $447 $
Slide 27: Wealth & Insurance
Wealth & Insurance Leading market positions #1 Online brokerage in Canada for assets and trades1 #2 Execution-only brokerage in the U.K.2 #1 Institutional Asset Management3 #1 Direct writer of home & auto insurance in Canada4 #1 Affinity home and auto insurance4 Leverage TD brand and clien
Slide 28: U.S. Personal & Commercial Banking
U.S. Personal & Commercial Banking Consistent Strategy Adjusted Net Income2 ($MM) $1,627 $1,422 $1,270 Where we compete $1,042 $909 Retail and commercial banking along the C$ $806 Eastern Seaboard Operate in 5 of the top 10 MSAs1 and 7 of the 10 wealthiest states US$ $794 $781 $1,008 $1,289 $1,4
Slide 29: U.S. Personal & Commercial Banking
U.S. Personal & Commercial Banking Lead in customer service and convenience Committed to providing legendary service and unparalleled convenience Open longer than the competition, including Sunday banking in most markets 24/7/365 live customer contact center support Significant scale and envia
Slide 30: Wholesale Banking
Wholesale Banking Consistent Strategy Adjusted Net Income1 (C$MM) Where we compete $1,137 $987 Canada $880 $815 Be the top-ranked integrated investment $648 dealer Fully aligned with TD Bank Group partners U.S. Extend the goals of the Canadian franchise $65 into the U.S. Build U.S. franchise
Slide 31: Wholesale Banking
Wholesale Banking Focus on client-driven franchise businesses Diversified business mix with a North American focus Presence in key global financial centres Evolved the business model by strategically repositioning the dealer to concentrate on core-client driven activities #1 Canadian (e.g.: ex
Slide 32: TD Model Has Proven Its Resilience
TD Model Has Proven Its Resilience Simple Strategy Headwinds Consistent Focus Superior Execution Slowing loan growth in Canada Lead with service and convenience Low interest rate environment Leverage TD brand across all segments Demanding regulatory environment Continue to invest while driving
Slide 33: Commitment to Corporate & Social Responsibility
Commitment to Corporate & Social Responsibility Corporate Leadership Extraordinary Workplace that Embraces Diversity One of Canada’s “Most Responsible One of the 50 Best Employers in Canada1 Companies” (Macleans magazine and Named one of The Best Places to Work for LGBT Sustainalytics, 2011, 2
Slide 34: Environmental Leadership & Community Engagement
Environmental Leadership & Community Engagement Environmental Leader One of the world’s top 500 corporate environmental leaders Framework of environmental/sustainability policies: (Newsweek 2012) TD Asset Management is a signatory to United Nations Only Canadian bank recognized in the 2013 G
Slide 35: Investor Relations Contacts
Investor Relations Contacts Phone: 416-308-9030 or 1-866-486-4826 Grand Prix for Best Overall Investor Relations: Large Cap Best Investor Relations by Email: Sector: Financial Services Best Investor Relations tdir@td.com by a CEO: Large Cap Best Investor Relations by a CFO: Large Cap Website: Best I
Slide 36: TD Bank Group
TD Bank Group Investor Presentation Q4 2013