Toronto-dominion Bank · TSX:TD
Toronto-dominion Bank — TD Bank Group — Q4 2018 Earnings Presentation
31 slides from Toronto-dominion Bank's earnings presentation, Nov 29, 2018
Slide 1: TD Bank Group Q4 2018 Quarterly Results Presentation
TD Bank Group Q4 2018 Quarterly Results Presentation Thursday November 29, 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: Fiscal 2018 Overview
Fiscal 2018 Overview Strong financial results Reported earnings up 8% (adjusted1 15%) Reported EPS up 9% (adjusted1 17%) Reported ROE of 16% (adjusted1 17%) Increased dividend paid by 11% over the full year Top total shareholder return over 3, 5 and 10 years2 Repurchased 20 million commo
Slide 4: 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 5: Fiscal 2018 Highlights
Fiscal 2018 Highlights Total Bank Reported Results (YoY) Financial Highlights $MM Reported 2018 2017 YoY EPS up 9% (17% adjusted1) Revenue 38,834 36,149 7% Revenue up 7% PCL 2,480 2,216 12% Expenses 20,137 19,366 4% Expenses up 4% Net Income 11,334 10,517 8% PCL up 12% Diluted EPS ($) 6.01 5.50 9% A
Slide 6: 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 7: Canadian Retail
Canadian Retail Highlights (YoY) P&L $MM Q4/18 QoQ YoY Net income up 5% Revenue 5,852 1% 8% Revenue up 8% Insurance Claims 684 9% 11% Revenue Net of Claims1 5,168 0% 8% Loan volumes up 6% PCL 263 7% 8% Deposit volumes up 3% Expenses 2,530 5% 11% Wealth assets2 up 1% Net Income 1,741 (6)% 5% PC
Slide 8: U.S. Retail
U.S. Retail Highlights US$MM (YoY) P&L US$MM (except where noted) YoY Net income up 38% (34% adjusted)1 Q4/18 QoQ YoY Adj.1 Revenue 2,193 2% 8% 8% Revenue up 8% PCL 187 10% 15% 15% Loan volumes up 3% Expenses 1,256 7% 3% 5% Deposit volumes up 5% U.S. Retail Bank Net Income 680 (3)% 26% 23% TD AM
Slide 9: Wholesale Banking
Wholesale Banking Highlights (YoY) P&L $MM Q4/18 QoQ YoY Net income up 24% Revenue 917 15% 32% Revenue up 32% PCL 8 NM NM Expenses 537 4% 28% Expenses up 28% Net Income 286 28% 24% Higher variable compensation and initiative ROE 18.4% spend Earnings $MM $278 $286 $267 $231 $223 Q4/17 Q1/18 Q2/18 Q
Slide 10: Corporate Segment
Corporate Segment Highlights (YoY) P&L $MM Reported Q4/18 Q3/18 Q4/17 Reported loss of $181MM Net Income (181) (113) 41 Adjusted1 loss of $118MM Dilution gain on Scottrade a year ago Adjusted1,2 Q4/18 Q3/18 Q4/17 Net Corporate Expenses (221) (214) (182) Other 85 87 43 Non-Controlling Interests 1
Slide 11: Capital & Liquidity
Capital & Liquidity Highlights (YoY) Common Equity Tier 1 Common Equity Tier 1 ratio of 12.0% Q3 2018 CET1 Ratio 11.7% Leverage ratio of 4.2% Internal capital generation 39 Actuarial gain on employee pension plans 6 Liquidity coverage ratio of 129% Organic RWA increase and other (10) Announced amend
Slide 12: Gross Impaired Loan Formations
Gross Impaired Loan Formations By Portfolio GIL Formations1: $MM and Ratios2 Highlights Gross impaired loan 20 21 bps formations increased 3 basis 19 18 18 points quarter-over-quarter driven by: $1,424 New formations in the $1,257 Canadian Commercial $1,189 $1,182 $1,149 portfolio from which we
Slide 13: Gross Impaired Loans (GIL)
Gross Impaired Loans (GIL) By Portfolio GIL1: $MM and Ratios2 Highlights Gross impaired loans increased $190MM quarter- 49 49 47 45 47 bps over-quarter reflecting: $97MM in the Canadian $3,085 $3,048 Commercial portfolio $3,154 $37 / 8 bps $31 / 6 bps $2,993 $2,964 US$33MM in the U.S. Credit C
Slide 14: Provision for Credit Losses (PCL)
Provision for Credit Losses (PCL) By Portfolio PCL1: $MM and Ratios2 Highlights $702 PCL increased $108MM $675 $8 quarter-over-quarter $602 $562 $567 reflecting: $183 $16 $155 $132 US$60MM in the U.S. Credit $107 $117 Card and Indirect Auto portfolios driven by $226 $256 $249 seasonal trends $22
Slide 15: Provision for Credit Losses (PCL) by Business Segment
Provision for Credit Losses (PCL)1,2 By Business Segment IAS 39 IFRS 9 Highlights PCL (C$MM) Q4/17 Q3/18 Q4/18 Impaired PCL broadly Total Bank $ 602 $567 $675 stable quarter-over- Impaired $ 557 $ 536 $ 564 quarter and year-over- Performing 45 31 111 Canadian Retail $ 244 $ 246 $ 263 year Impaired
Slide 16: Oil and Gas Exposure
Oil and Gas Exposure Corporate and Commercial Outstandings Highlights by Sector ($B): Oil and Gas Producers and Services outstandings continue to represent <1% of total gross loans and acceptances Producers 73% 27% $3.0 $35MM impaired loans in Commercial; nil in Wholesale 1 Outstandings to Pro
Slide 17: Appendix
Appendix
Slide 18: Q4 2018: Items of Note
Q4 2018: Items of Note $MM EPS ($) Reported net income and EPS (diluted) 2,960 1.58 Revenue/ Expense Items of note Pre Tax After Tax EPS Segment Line Item4 Amortization of intangibles1 76 63 0.04 Corporate page 8, line 14 Charges associated with the Scottrade transaction2 25 25 0.01 U.S. Retail page
Slide 19: Fiscal 2018: Items of Note
Fiscal 2018: Items of Note $MM EPS ($) Reported net income and EPS (diluted) 11,334 6.01 Revenue/ Expense Items of note Pre Tax After Tax EPS Segment Line Item5 Amortization of intangibles1 324 269 0.15 Corporate page 8, line 14 Charges associated with the Scottrade transaction2 193 188 0.10 U.S. Re
Slide 20: Canadian Retail
Canadian Retail Net Interest Margin Average Deposits $B 317 323 323 327 329 23 24 24 24 24 2.93% 2.94% 2.91% 107 109 110 112 113 2.86% 2.88% 186 189 190 191 192 Q4/17 Q1/18 Q2/18 Q3/18 Q4/18 Q4/17 Q1/18 Q2/18 Q3/18 Q4/18 Personal Business Wealth Efficiency Ratio Average Loans $B 399 406 415 390 395
Slide 21: Canadian Retail: Wealth
Canadian Retail: Wealth Wealth Revenue $MM Wealth Assets $B1 1,053 1,047 1,069 1,016 966 144 156 159 147 134 158 135 157 397 392 403 389 137 387 115 289 289 297 289 283 717 751 732 756 753 Q4/17 Q1/18 Q2/18 Q3/18 Q4/18 Q4/17 Q1/18 Q2/18 Q3/18 Q4/18 Fee & Other Transaction NII AUA AUM 21 1. Canadian
Slide 22: U.S. Retail
U.S. Retail Net Interest Margin1 Average Deposits US$B 261 265 263 264 250 3.33% 3.33% 109 110 109 107 99 3.23% 3.19% 66 65 66 65 69 3.18% 85 87 88 88 88 Q4/17 Q1/18 Q2/18 Q3/18 Q4/18 Q4/17 Q1/18 Q2/18 Q3/18 Q4/18 3 Personal Business TD Ameritrade IDAs Efficiency Ratio2 Average Loans US$B 148 151 15
Slide 23: U.S. Retail: Wealth and TD Ameritrade
U.S. Retail: Wealth and TD Ameritrade TD Wealth Assets US$B1 TD Ameritrade2 – Q4 2018 TD’s share of TD Ameritrade’s net income was 65 US$175MM on a reported basis and US$194MM 63 59 58 on an adjusted3 basis, up 96% YoY reflecting: 52 Contribution from Scottrade, higher interest rates, lower corpor
Slide 24: Gross Lending Portfolio
Gross Lending Portfolio Includes B/As Balances ($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 Card
Slide 25: Canadian Real Estate Secured Lending Portfolio
Canadian Real Estate Secured Lending Portfolio Quarterly Portfolio Volumes $B Highlights $265 $267 $269 $275 $280 Canadian RESL credit quality remains 58% 59% 61% 63% 65% strong Uninsured Uninsured and insured portfolio loan-to-value Insured 42% 41% rates stable 39% 37% 35% Less than 1% of unins
Slide 26: Canadian Personal Banking
Canadian Personal Banking Q4/18 Gross GIL GIL / Highlights Canadian Personal Banking Loans ($B) ($MM) Loans Credit quality remains strong Residential Mortgages $194 $264 0.14% in the Canadian Personal Home Equity Lines of Credit (HELOC) 86 130 0.15% portfolio Indirect Auto 24 69 0.28% Credit Cards
Slide 27: Canadian Commercial and Wholesale Banking
Canadian Commercial and Wholesale Banking Gross Q4/18 Highlights Canadian Commercial and GIL GIL/ Loans/BAs Canadian Commercial and Wholesale Banking ($MM) Loans ($B) Commercial Banking1 $76 $288 0.38% Wholesale Banking portfolios continue to perform well Wholesale 51 - 0.00% Total Canadian Commer
Slide 28: U.S. Personal Banking – U.S. Dollars
U.S. Personal Banking – U.S. Dollars Q4/18 Gross GIL GIL / U.S. Personal Banking1 Loans ($B) ($MM) Loans Highlights Residential Mortgages $23 $338 1.47% Continued good asset quality Home Equity Lines of Credit (HELOC)2 9 650 6.93% in U.S. Personal Indirect Auto 23 169 0.75% Credit Cards 13 244 1.9
Slide 29: U.S. Commercial Banking – U.S. Dollars
U.S. Commercial Banking – U.S. Dollars Q4/18 U.S. Commercial Banking1 Gross Loans / BAs GIL GIL/ Highlights ($B) ($MM) Loans Sustained good credit quality Commercial Real Estate (CRE) $23 $101 0.45% in U.S. Commercial banking Non-residential Real Estate 17 79 0.47% Residential Real Estate 6 22 0.3
Slide 30: 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 31: TD Bank Group Q4 2018 Quarterly Results Presentation
TD Bank Group Q4 2018 Quarterly Results Presentation Thursday November 29, 2018