Toronto-dominion Bank · TSX:TD
Toronto-dominion Bank — TD Bank Group — Q2 2013 Earnings Presentation
36 slides from Toronto-dominion Bank's earnings presentation, 2013
Slide 1: TD Bank Group Investor Presentation Q2 2013
TD Bank Group Investor Presentation Q2 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 6th largest bank 1 Top 10 Retail Focused North American Bank by Market Cap and Total Assets1 Delivering 2 Proven Performance top tier long term shareholder returns Highly rated by all 3 Strong Balance Sheet and Capital Position major credit rating agencies Targeting 7-10
Slide 4: TD Bank Group
TD Bank Group Our Businesses Canadian Personal & Commercial Personal banking Small business and commercial banking Wealth & Insurance Direct investing Advice-based wealth business Asset management 2,475 Insurance Business Locations1 U.S. Personal & Commercial CAD U.S. Personal banking
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$15.1 trillion Population of 35 million Population of 314 million Canadian Banking System U.S. Banking System Soundest banki
Slide 7: TD Bank Group in North America
TD Bank Group in North America Compared to: Q2 2013 North Canadian (C$ billions) American Peers5 Peers6 Total Assets $826B 2nd 6th Total Deposits $501B 3rd 7th Market Cap (as of May 22, 2013) $77B 2nd 6th Adj. Net Income1 (Trailing 4 Quarters) $7.3B 2nd 6th Rpt. Net Income (Trailing 4 Quarters) $6.8
Slide 8: Composition of Earnings
Composition of Earnings Highlights TD is a top 10 bank in North America1 Increasing retail focus Wholesale 10% Strength of retail franchise Reliable and steady earnings mix U.S. P&C Canadian 21% P&C 49% 3,4 TD AMTD Adjusted Retail Earnings2,5 $7,075 3% 12% Wealth & Wholesale Earnings 13% Ins
Slide 9: Evolution of TD
Evolution of TD Building Franchise Businesses >>> Increasing Retail focus >>> Acquired Acquired TD Chrysler Target credit Waterhouse Financial card portfolio TD Bank Acquired Acquired USA/ Privatized Acquired Commerce Acquired and MBNA and Epoch and Canada Newcrest 51% of Ameritrade TD Commerce Bank
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
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 R CAG s: 11% 3 $7,075 ear g (C$MM) 5-y Earnin : 5% $6,432 s t ed EPS d Adju djuste A $5,228 $4,716 $4,189 $3,813 $3,749 Wholesale Banking U.S. P&C Wealth & Insurance2 Canadian P&C2 2007 2008 2009 2010 2011 2012 YTD 2013 Adjusted Retail
Slide 13: Strong Total Shareholder Returns
Strong Total Shareholder Returns Total Shareholder Return (CAGR1) CDN Peers2 NA Peers3 18.7% 13.1% 11.9% 10.6% 8.6% 8.7% 6.7% 6.0% 4.8% 4.1% 2.7% 0.2% 1 Year 3 Years 5 Years 10 Years Delivering top tier long-term shareholder returns 1. Compounded Annual Growth Rates (CAGRs) for all periods ended Apr
Slide 14: Strong, Consistent Dividend History
Strong, Consistent Dividend History Dividends Per Share (C$) Q1/13: $2.89 Announced $0.04 dividend increase1 w th r o dG Dividend alize nu Yield: An 11 % 3.7%2 $0.38 Q3/12 Increased Target Payout Range: 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 20
Slide 15: Q2 2013 Highlights
Q2 2013 Highlights Key Themes Net Income $MM (Adjusted, where applicable)1 Adjusted1 EPS growth of 4% YoY Q2/13 QoQ YoY and 6% YTD Retail2 $ 1,639 -4% 5% Wholesale 220 38% 12% Solid earnings growth in retail Corporate (26) -153% -30% businesses and a strong Adjusted Net Income $ 1,833 -4% 6% per
Slide 16: Q2 2013 Operating Highlights
Q2 2013 Operating Highlights Key Themes by Segment Adjusted earnings1 up 5% YoY Good performance Canadian Lending volumes solid in personal and strong in business in a challenging P&C Adjusted expenses up 1% YoY operating environment For the first half of 2013, earnings increased by 8% Wea
Slide 17: Q2 2013 Credit Highlights
Q2 2013 Credit Highlights Key Credit Themes PCL Ratio (bps)1,2 48 46 46 Positive credit trends continue: Decreased delinquencies in the 39 35 Canadian and U.S. Personal portfolios Canadian Credit Card loss rates continued to improve PCL rate was comparable to the prior quarter excluding Targ
Slide 18: TD Bank Group – Key Messages
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 Funding Mix
Attractive Funding Mix Funding Mix1 Wholesale Term Debt2 Other Deposits3 Personal 26% Assets Securitized Term Deposits 61% 9% Short Term Liabilities4 11% Personal Non‐ Term Deposits Wholesale Term Covered Bonds 36% Debt Senior 15% 10% Debt 24% Sub‐ Trading Debt Deposits 1% 7% P&C Deposits 71% Person
Slide 20: Strong Capital Position
Strong Capital Position Highlights Basel III Common Equity Tier 11 8.8% 8.8% Basel III Common Equity Tier 1 8.2% 7.4% 7.7% ratio of 8.8% as of April 30, 2013 Exceeded 7% regulatory requirement on a fully phased-in basis Includes 30 bps of relief from OSFI on treatment of CVA Q2/12 Q3/12 Q4/12
Slide 21: Strong Focus on Risk – Adjusted Return
Strong Focus on Risk – Adjusted Return Citations Adjusted Return on Risk-Weighted Assets1 Global Finance magazine 2.59% ranked TD as the Safest Bank 2.34% in North America and one of 1.67% the World’s 50 Safest Banks (February 2013) Bloomberg Markets magazine ranked TD as the world’s 8th stronge
Slide 22: Gross Lending Portfolio
Gross Lending Portfolio Balances Highlights C$B (unless otherwise noted) Q2/13 Canadian Personal & Commercial Portfolio $ 304.5 Canadian portfolio – strong credit quality Personal $ 259.6 Residential Mortgages 156.7 Real estate secured lending volume up 4% YoY Home Equity Lines of Credit (HELOC) 6
Slide 23: TD Bank Group – Key Messages
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) $3,408 $3,095 $3,051 Where we compete $2,424 $2,472 $2,253 Continue to win in retail banking $1,821 Higher growth opportunities Business banking Credit cards Auto lending 2007 2008 2009 2010 2011 2012 YT
Slide 25: Canadian Personal & Commercial Banking
Canadian Personal & Commercial Banking Leaders in customer service and convenience TD has opened approximately 1 out of every 3 new branches1 On average 45% longer branch hours than peers2 Sunday banking in more than 415 branches Integrated product offerings #1 or #2 market share in most ret
Slide 26: Wealth & Insurance
Wealth & Insurance Consistent Strategy Net Income1 (C$MM) $1,367 $1,314 Where we compete $557 $541 Wealth $762 $769 $741 $641 $209 $597 Mass affluent and high net worth TD clients in $261 $289 $207 $318 Canada and U.S. $252 $194 $100 Self-directed investors in selected markets $501 $566 $601 $48
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 Private Investment Counsel4 #1 Direct writer of home & auto insurance in Canada5 #1 Affinity home and auto insur
Slide 28: U.S. Personal & Commercial Banking
U.S. Personal & Commercial Banking Consistent Strategy Adjusted Net Income2 $1,422 ($MM) $1,270 Where we compete $909 $1,042 $806 $783 Retail and commercial banking along the Eastern Seaboard C$ $359 Operate in 5 of the top 10 MSAs1 and 7 of the 10 wealthiest states US$ $328 $794 $781 $1,008 $1,
Slide 29: U.S. Personal & Commercial Banking
U.S. Personal & Commercial Banking Lead in customer service and convenience Committed to providing legendary service and unparalleled convenience Open longer than the competition, including Sunday banking in most markets 24/7/365 live customer contact center support Significant scale and envia
Slide 30: Wholesale Banking
Wholesale Banking Consistent Strategy Adjusted Net Income1 (C$MM) Where we compete $1,137 $987 Canada $880 $824 $815 Be the top-ranked integrated investment dealer U.S. $379 Extend the goals of the Canadian franchise $65 Be a Wholesale dealer to U.S. P&C Grow U.S. fixed income and foreign 20
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 Top-Rated (e.g.: exit
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 Lower for longer interest rates Leverage TD brand across all segments Demanding regulatory environment Continue to invest Focus on or
Slide 33: Commitment to Corporate and Social Responsibility
Commitment to Corporate and Social Responsibility Corporate Leadership Extraordinary Workplace that Embraces Diversity One of Canada’s “Most Responsible One of the 50 Best Employers in Canada and one of Companies” (Macleans magazine and the Top 30 Green Employers1 Sustainalytics, in both 2011 an
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 One of Canada’s top 20 organizations in ter
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 Q2 2013