National Bank Of Canada · TSX:NA

National Bank Of Canada — Q3 2011 Earnings Presentation

19 slides from National Bank Of Canada's earnings presentation, Aug 25, 2011

  1. Slide 1: Analyst and Investor Presentation Q3 2011 Results Conference Call

    ANALYST AND INVESTOR PRESENTATION Q3 2011 RESULTS CONFERENCE CALL August 25, 2011 CAUTION REGARDING FORWARD-LOOKING STATEMENTS From time to time, National Bank of Canada (the Bank) makes written and oral forward-looking statements, such as those contained in the “Major Economic Trends” section and u

  2. Slide 2: Highlights: Adjusted Results

    HIGHLIGHTS ADJUSTED RESULTS Q3 2011 YTD 2011 Net Income $293M $900M Diluted EPS $1.72 $5.21 Provision for credit losses $26M or 16 bps $98M or 21 bps ROE 17.50% 18.20% Tier 1 ratio (Basel II) 13.9% 13.9% Common Equity Tier 1 ratio (Basel III) 8.0% 8.0% Dividend payout 38% 38% (trailing 4 quarters) N

  3. Slide 3: Performance Snapshot

    PERFORMANCE SNAPSHOT (millions of dollars) Adjusted(2) Reported Q3 2011 vs. Q3 2010 Q3 11 Q3 10 Change Q3 11 Q3 10 Change (adjusted) Revenues(1) 1,109 1,066 4% 1,109 1,063 4%  Top line: keeping momentum  Good cost control Expenses 700 684 2% 718 684 5% Net Income 293 273 7% 312 271 15% EPS $1.72 $

  4. Slide 4: Well Diversified Business Mix

    WELL DIVERSIFIED BUSINESS MIX TEB YTD 2011 vs. (YTD 2010) Q3 2011 vs. (Q3 2010) REVENUES(1)(2) 30% 28% (29%) (27%) 52% 55% (54%) (56%) 17% 18% (17%) (17%) Personal and Commercial Banking Financial Markets Wealth Management 12 (9) NET INCOME(2) 8 (millions of dollars) 9 290 293 293 273 Q3 2010 Person

  5. Slide 5: Business Line Efficiency Ratio; Basel III Impact to Common Equity Tier 1

    BUSINESS LINE EFFICIENCY RATIO TEB 61.0% 60.6% (1) NBFG 61.0% 54.7% Financial 47.9% (1) Markets 55.7% 74.5% Wealth 72.5% Management 77.7% 56.9% Personal and Commercial 57.1% Banking 56.9% Q3 11 Q2 11 Q3 10 (1) Excluding specified items and adjusted for gains or losses attributable to third parties Q

  6. Slide 6: Quarterly Common Equity Tier 1 Evolution; Risk Management

    QUARTERLY COMMON EQUITY TIER 1 EVOLUTION 0.06% 0.34% -0.39% -0.21% 8.54% 8.20% 8.20% 8.21% 8.00% 8.00% Common Equity Profit less RWA impact Capital Wellington West Common Equity Tier 1 Q2 2011 dividends management acquisition Tier 1 Q3 2011 Q3 2011 RESULTS CONFERENCE CALL – August 25, 2011 I 11 RISK

  7. Slide 7: Global Portfolio Composition; Risk Provisioning

    GLOBAL PORTFOLIO COMPOSITION As at July 31, 2011 vs. (July 31, 2010) PER BUSINESS PER INDUSTRY SEGMENT (Corporate & Commercial) 18% 19% (17%) (19%) 25% (27%) 15% 17% (14%) (16%) 9% (8%) 66% 4% (65%) 4% (4%) (5%) 10% (11%) 13% (14%) Personal Banking Primary sector Construction and real estate Transpo

  8. Slide 8: Impaired Loans; Impaired Loan Formation

    IMPAIRED LOANS (millions of dollars) 7.15% 7.23% 6.93% 6.67% 6.86% 411 379 393 382 369 176 194 162 173 162 (132) (146) (114) (135) (146) $101M (1) $77M (1) $32M (1) $144M (1) $121M (1) (178) (215) (212) (276) (267) Q3 10 Q4 10 Q1 11 Q2 11 Q3 11 Gross Impaired Loans Impaired Loans before general allo

  9. Slide 9: Stable VaR; Business Segment Review

    STABLE VAR (millions of dollars) GLOBAL TRADING VAR(1) Q3 10 Q4 10 Q1 11 Q2 11 Q3 11 $(5.8) $(5.7) $(6.5) $(6.4) $(7.6) (1) Excluding ABCP VAR Q3 2011 RESULTS CONFERENCE CALL – August 25, 2011 I 17 BUSINESS SEGMENT REVIEW Jean Dagenais Senior Vice-President Finance, Taxation, and Investor Relations

  10. Slide 10: Personal and Commercial Banking Quarterly Results and Revenues

    PERSONAL AND COMMERCIAL BANKING Quarterly Results (millions of dollars) TEB 168 Q3 2011 vs. Q3 2010 159 157 147 149  Revenues up 3% due to good volume growth in loans and BAs  Net income up 6% 633 645 626 625 618 Q3 2011 vs. Q2 2011 356 367 359 353 367  Revenues up 4% due to a 3% volume growth in

  11. Slide 11: Personal and Commercial Banking Loans and Deposits Evolution

    PERSONAL AND COMMERCIAL BANKING Loans & BAs Evolution Average Monthly Volume 11% (billions of dollars) 10% 10% 9% 9% 68.5 66.3 63.4 64.5 62.0 PERSONAL AND COMMERCIAL July 2010 October 2010 January 2011 April 2011 July 2011 10% 10% 11% Q3 2011 vs. Q3 2010 10% 9% PERSONAL 44.9 46.0 46.8 47.8 49.8  Go

  12. Slide 12: Personal and Commercial Banking Margin and Expenses

    PERSONAL AND COMMERCIAL BANKING Margin Evolution 2.46% 2.48% 2.45% Q3 2011 vs. Q2 2011 2.38% 2.34%  Lower spreads due to competitive environment, 1.81% business mix, and 1.79% 1.80% 1.80% 1.80% yield curve 1.72% 1.72% 1.72% 1.67% 1.66% 1.29% 1.27% 1.22% 1.23% 1.21% Q3 10 Q4 10 Q1 11 Q2 11 Q3 11 P&C

  13. Slide 13: Key Takeaways; Wealth Management Quarterly Results

    PERSONAL AND COMMERCIAL BANKING KEY TAKEAWAYS  Good volume growth in Personal and Commercial Banking  Stable efficiency ratio  Infrastructure  Q3 2011: 13 branches relocated or revamped  Q4 2011: 7 new branch openings  Launch of the International direct payment solution Q3 2011 RESULTS CONFERE

  14. Slide 14: Wealth Management Revenues and Assets Under Administration

    WEALTH MANAGEMENT Revenues Breakdown (millions of dollars) TEB 222 Q3 2011 vs. Q3 2010 218 208 197 32 31  NII up $3M or 10% mainly 188 32 31 due to higher short-term 29 interest rate  Fee-based revenues up 109 112 $14M or 14% driven by 102 113 market growth at the start 99 of the year  Transactio

  15. Slide 15: Wealth Management Key Takeaways; Financial Markets Quarterly Results

    WEALTH MANAGEMENT KEY TAKEAWAYS  Wellington West: transaction closed July 15, 2011  Most advisors (99%), representing 99% of AUA, signed an employment contract with National Bank  Synergies: on time and on target  Full integration expected in coming quarters  New commission grid at NBF WM: reve

  16. Slide 16: Financial Markets Revenues and Trading Revenues Breakdown

    FINANCIAL MARKETS Revenues Breakdown(1) (millions of dollars) TEB 375 380 341 85 327 88 309 73 72 22 78 7 27 22 60 76 18 62 66 65 60 64 64 65 60 141 134 133 88 102 Q3 10 Q4 10 Q1 11 Q2 11 Q3 11 Trading Corp. Banking Capital Markets Inv. gains Other (1) Excluding specified items and adjusted for gain

  17. Slide 17: Financial Markets Key Takeaways; Appendix 1 Detail of Specified Items

    FINANCIAL MARKETS KEY TAKEAWAYS  For calendar 2011, NBF is currently ranked #1 in Government Underwriting in Canada, with 23.7% market share(1)  For first half of calendar 2011, NBF ranked #4 in Debt and Equity Underwriting in Canada  NBF was lead or co-lead underwriter for 20 debt issues with no

  18. Slide 18: Appendix 2 PIIGS Exposure; Appendix 3 Restructured ABCP

    APPENDIX 2 │ PIIGS Exposure in US$ (millions of dollars) PIIGS Exposure as of July 31st, 2011 - US$ Direct Credit Risk Portugal - Ireland 44.9 Italy 7.4 Greece - Spain 0.3 Total * 52.6 * Contingent / Trade Finance exposure of $183 million. Q3 2011 RESULTS CONFERENCE CALL – August 25, 2011 I 35 APPEN

  19. Slide 19: Appendix 4 Common Equity Tier 1 Definition

    APPENDIX 4 │ COMMON EQUITY TIER 1 DEFINITION Under Base lII, a new measure of capital is used to evaluate financial institutions ability to deal with unexpected losses. Common Equity Tier 1 includes common shares, contributed surplus, retained earnings, accumulated other comprehensive income, qualif

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