Toronto-dominion Bank · TSX:TD
Toronto-dominion Bank — TD Bank Group — Q3 2013 Earnings Presentation
36 slides from Toronto-dominion Bank's earnings presentation, 2013
Slide 1: TD Bank Group Investor Presentation Q3 2013
TD Bank Group Investor Presentation Q3 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, credit cards and auto finance Small business and commercial banking Wealth & Insurance Direct investing Advice-based wealth business Asset management 2,481 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$15.1 trillion Population of 35 million Population of 314 million Canadian Banking System U.S. Banking System Soundest banki
Slide 7: TD Bank Group in North America
TD Bank Group in North America Compared to: Q3 2013 North Canadian (C$ billions) American Peers5 Peers6 Total Assets $835B 2nd 6th Total Deposits $508B 2nd 6th Market Cap (as of August 30, 2013) $82B 2nd 6th Adj. Net Income1 (Trailing 4 Quarters) $7.1B 2nd 6th Rpt. 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 Adjusted Retail Earnings2,6 Wholesale Earnings YTD’13 Normalized Adj. Retail Earnings2,5,6 = 91% 1. See slide 6. Retail-focused earni
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
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 $7,075 (C$MM) $6,432 $5,228 $5,337 $4,716 $4,189 $3,813 Wholesale Banking U.S. P&C Wealth & Insurance2 Canadian P&C2 2007 2008 2009 2010 2011 2012 YTD 2013 Adjusted Retail Earnings as % of 80% 98% 78% 83% 87% 88% 90% Adjusted Earnings T
Slide 13: Strong Total Shareholder Returns
Strong Total Shareholder Returns Total Shareholder Return (CAGR1) CDN Peers2 NA Peers3 37.6% 16.8% 13.9% 12.5% 10.8% 10.9% 10.9% 10.5% 9.6% 9.4% 4.2% 5.4% 1 Year 3 Years 5 Years 10 Years Delivering top tier long-term shareholder returns 1. Compounded Annual Growth Rates (CAGRs) for all periods ended
Slide 14: Strong, Consistent Dividend History
Strong, Consistent Dividend History Dividends Per Share (C$) Q3/13: Announced $0.04 dividend increase1 Dividend Yield: 3.7%2 Q3/12: Increased Target Payout Range to 40%-50%3 Dividend has grown over time 1. Payable on October 31, 2013. 2. Dividend yield based on dividend per share for trailing four q
Slide 15: Q3 2013 Highlights
Q3 2013 Highlights Key Themes Net Income $MM (Adjusted, where applicable)1 Adjusted1 EPS decline of 14% Q3/13 QoQ YoY YoY driven by Insurance loss Retail2 $ 1,449 -12% -10% Wholesale 147 -33% -18% Record quarter for Canadian Corporate (8) -69% n/a P&C, Wealth Management and Adjusted Net Income $
Slide 16: Q3 2013 Operating Highlights
Q3 2013 Operating Highlights Key Themes by Segment Adjusted earnings1 up 12% YoY New record, strong Canadian Record adjusted revenue and net income credit and improved P&C Lending volumes strong in business and solid in personal efficiency Adjusted expenses up 2% YoY Record Wealth earnings
Slide 17: Q3 2013 Credit Highlights
Q3 2013 Credit Highlights Key Credit Themes PCL Ratio (bps)1,2 Continued solid credit performance: Canadian Credit Cards loss rates continued to improve Lowest charge-off rate for the U.S. Commercial portfolio in over 3 years Increased Gross Impaired Loans due to seasoning of the Target port
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 Balance Sheet Composition
Attractive Balance Sheet Composition Funding Mix1 Wholesale Term Debt2 Assets Securitized 59% Other Deposits3 3 Other Deposits Personal Personal 26%25% Term TermDeposits Deposits Residential Mortgages 9% 9% 58% Short Term Short Term Liabilities4 4 Liabilities 10%11% Personal Non- Covered Bonds Perso
Slide 20: Strong Capital Position
Strong Capital Position Highlights Basel III Common Equity Tier 11 Basel III Common Equity Tier 1 ratio of 8.9% as of July 31, 2013 Includes 30 bps of relief from OSFI on treatment of CVA Managing capital volatility – AOCI Dividend increase of $0.04 per share payable in Q4 2013 Share buyba
Slide 21: Strong Focus on Risk – Adjusted Return
Strong Focus on Risk – Adjusted Return Citations Adjusted Return on Risk-Weighted Assets1 Global Finance magazine ranked TD as the Safest Bank 2.45% 2.14% in North America and one of 1.65% the World’s 50 Safest Banks (February 2013) Bloomberg Markets magazine ranked TD as the world’s 8th stronge
Slide 22: Gross Lending Portfolio
Gross Lending Portfolio Balances Highlights C$B (unless otherwise noted) Q3/13 Canadian Personal & Commercial Portfolio $ 310.3 Canadian portfolio – strong credit quality Personal $ 264.1 Residential Mortgages 161.0 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$MM) Where we compete Con onttinu nuee to win in retai aill bank nkiing Highe herr grow growtth oppo porrtuni nitties Bus usiines nesss banki banking Credi editt car ards ds Aut utoo lendi ending ng How we wi
Slide 25: Canadian Personal & Commercial Banking
Canadian Personal & Commercial Banking Leaders in customer service and convenience TD has opened approximately 1 out of every 3 new branches1 On average 45% longer branch hours than peers2 Sunday banking in more than 420 branches Integrated product offerings #1 or #2 market share in most ret
Slide 26: Wealth & Insurance
Wealth & Insurance Consistent Strategy Net Income1 (C$MM) $1,367 $1,314 Where we compete $557 $541 Weal ealtth $762 $769 $748 $641 $209 $75 Mass affluent and high net worth TD clients in $261 $289 $597 $207 $169 Canada and U.S. $252 $194 Self-directed investors in selected markets $501 $566 $601
Slide 27: Wealth & Insurance
Wealth & Insurance Leading market positions #1 Online brokerage in Canada for assets and trades1 #2 Execution-only brokerage in the U.K.2 #1 Institutional Asset Management3 #1 Direct writer of home & auto insurance in Canada4 #1 Affinity home and auto insurance4 Leverage TD brand and clien
Slide 28: U.S. Personal & Commercial Banking
U.S. Personal & Commercial Banking Consistent Strategy Adjusted Net Income2 ($MM) Where we compete Retail and commercial banking along the Eastern Seaboard Operate in 5 of the top 10 MSAs1 and 7 of the 10 wealthiest states Focused on higher growth markets and products How we win Unique value
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 $526 U.S. 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 Low interest rate environment Leverage TD brand across all segments Demanding regulatory environment Continue to invest while driving
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 Email: Best Investor Relations by Sector: Financial Services tdir@td.com Best Investor Relations by a CEO: Large Cap Best Investor Relations by a CFO: Large Cap Website: Best I
Slide 36: TD Bank Group Investor Presentation
TD Bank Group Investor Presentation Q3 2013