National Bank Of Canada · TSX:NA

National Bank Of Canada — Q1 2011 Earnings Presentation

20 slides from National Bank Of Canada's earnings presentation, Feb 24, 2011

  1. Slide 1: Analyst and Investor Presentation Q1 2011 Results Conference Call

    ANALYST AND INVESTOR PRESENTATION Q1 2011 RESULTS CONFERENCE CALL February 24, 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

  2. Slide 2: Highlights / Broad-Based Earnings

    HIGHLIGHTS RECORD QUARTER Q1 2011 Net Income $312M Diluted EPS $1.80 Provision for credit losses $39M or 26 bps ROE 19.0% Tier 1 ratio (Basel II) 14.60% Common Equity Tier 1 ratio (Basel III) 8.10% Dividend payout: 38% (trailing 4 quarters) Note: See appendix 4 for a definition of Common Equity Tier

  3. Slide 3: Financial Review / Performance Snapshot

    FINANCIAL REVIEW Patricia Curadeau-Grou Chief Financial Officer and Executive Vice-President Finance, Risk and Treasury NAME OF PRESENTATION – Date 1, 2010 I 5 PERFORMANCE SNAPSHOT (millions of dollars) Q1 2011 vs. Q1 2010 Adjusted(2) Reported (adjusted) Q1 11 Q1 10 Change Q1 11 Q1 10 Change  5 % r

  4. Slide 4: Well Diversified Business Mix / Sound Business Segment Revenues Diversification

    WELL DIVERSIFIED BUSINESS MIX TEB Q1 2011 vs. (Q1 2010) REVENUES(1)(2) 30% (31%) 52% (52%) 18% (17%) Personal and Commercial Banking Financial Markets Wealth Management NET INCOME(2) (7) 9 (millions of dollars) 21 21 312 303 303 268 Q1 2010 Personal and Wealth Financial Markets Other Segment Q1 2011

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

    BUSINESS LINE EFFICIENCY RATIO TEB 58.8% Q1 2011 vs. Q1 2010 (1) NBFG 60.4% Overall efficiency ratio 59.9% improved by 110 bps (1) 47.5% Financial 49.7% Markets 41.7% 71.6% Wealth 76.1% Management 80.3% Personal and 56.7% Commercial 58.7% Banking 57.9% Q1 11 Q4 10 Q1 10 (1) Excluding specified items

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

    QUARTERLY COMMON EQUITY TIER 1 EVOLUTION 0.10% 0.43% 8.10% 7.57% Common Equity Tier 1 Profit less dividends Reduction of RWA Common Equity Tier 1 Q4 2010 Q1 2011 Q1 2011 RESULTS CONFERENCE CALL – February 24, 2011 I 11 RISK MANAGEMENT NAME OF PRESENTATION – Date 1, 2010 I 12 6

  7. Slide 7: Global Portfolio Composition / Risk Provisioning

    GLOBAL PORTFOLIO COMPOSITION As at January 31, 2011 vs. (January 31, 2010) PER BUSINESS PER INDUSTRY SEGMENT (Corporate & Commercial) 19% 19% 25% (17%) (19%) (24%) 14% (13%) 16% (16%) 10% (12%) 65% 5% (64%) (5%) 4% (5%) 10% (11%) 14% (14%) Personal Banking Primary sector Construction and real estate

  8. Slide 8: Impaired Loans / Impaired Loan Formation

    IMPAIRED LOANS (millions of dollars) 8.88% 8.81% 7.15% 7.23% 6.67% 453 447 411 379 369 259 246 194 176 162 (199) (213) (215) (276) (267) Q1 10 Q2 10 Q3 10 Q4 10 Q1 11 Gross Impaired Loans Impaired Loans before general allowances Impaired Loans, net of specific and general allowances Gross Impaired L

  9. Slide 9: Sound Market Risk Management / Business Segment Review

    SOUND MARKET RISK MANAGEMENT (millions of dollars) GLOBAL TRADING VAR(1) Q1 10 Q2 10 Q3 10 Q4 10 Q1 11 $(5.8) $(5.7) $(6.1) $(6.9) $(7.6) (1) Excluding ABCP VAR Q1 2011 RESULTS CONFERENCE CALL – February 24, 2011 I 17 BUSINESS SEGMENT REVIEW Jean Dagenais Senior Vice-President Finance, Taxation and

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

    PERSONAL AND COMMERCIAL BANKING Quarterly Results (millions of dollars) TEB 159 157 147 Q1 2011 vs. Q1 2010 136 136  Revenues up 6% due to strong volume growth in loans and BAs (+9%) 626 625 633  Net income up 15% 596 595  Net income before PCL up 9% Q1 2011 vs. Q4 2010 345 345 356 367 359  Reve

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

    PERSONAL AND COMMERCIAL BANKING Loans & BAs Evolution 10% 9% Average Monthly Volume 9% (billions of dollars) 8% 8% 63.4 64.5 60.2 62.0 59.0 PERSONAL AND COMMERCIAL January 2010 April 2010 July 2010 October 2010 January 2011 9% 10% 9% 8% 8% 44.9 45.9 46.8 YoY Growth: 42.7 43.5 Mortgages 9.8% 18.4 19.

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

    PERSONAL AND COMMERCIAL BANKING Margin Evolution Q1 2011 vs. Q4 2010 2.50% 2.49% 2.48%  Margins are stable 2.46% 2.45% 1.85% 1.82% 1.81% 1.80% 1.79% 1.75% 1.76% 1.72% 1.72% 1.72% 1.29% 1.27% 1.21% 1.22% 1.17% Q1 10 Q2 10 Q3 10 Q4 10 Q1 11 P&C Loans Deposits Prime / BA's Q1 2011 RESULTS CONFERENCE C

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

    PERSONAL AND COMMERCIAL BANKING KEY TAKEAWAYS  Good volume growth in Personal and Commercial Banking  Efficiency ratio improved 120 bps from Q1 2010 to Q1 2011  One Client, One Bank  Consolidation of Phase 1 and moving into Phase 2  Q1 2011: 4 branches relocated or revamped  Q2 to Q4 2011: 55

  14. Slide 14: Wealth Management Revenues Breakdown and Assets

    WEALTH MANAGEMENT Revenues Breakdown (millions of dollars) TEB Q1 2011 vs. Q1 2010  NII up 7M$ or 28% mainly due to higher rate 218  Fee-based revenue up 193 196 188 197 32 $11M or 11% due to good 25 24 momentum in sales and 31 29 market growth  Transactional revenues up 109 $7M or 10% due to a h

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

    WEALTH MANAGEMENT KEY TAKEAWAYS  Best quarter for transactional revenues since 2007  Good expense control resulting in an operational leverage of 12%  Recent developments  Turnaround in our hedge fund platform with $213M net sales in the quarter and good momentum for the next quarters  Expansio

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

    FINANCIAL MARKETS Revenues Breakdown(1) (millions of dollars) TEB 375 360 334 340 54 88 40 309 72 35 29 27 78 7 59 60 60 62 18 62 57 65 60 64 60 150 148 141 134 88 Q1 10 Q2 10 Q3 10 Q4 10 Q1 11 Trading Corp. Banking Capital Markets Inv. gains Other (1) Excluding specified items and adjusted for gain

  17. Slide 17: Financial Markets Key Takeaways / Positioned for Growth

    FINANCIAL MARKETS KEY TAKEAWAYS  Trading: good momentum in client related trading, particularly in derivative products  Corporate & Investment Banking: strong pipeline in Infrastructure and M&A  Credigy: higher than projected revenues Q1 2011 RESULTS CONFERENCE CALL – February 24, 2011 I 33 POSIT

  18. Slide 18: Appendix 1 Detail of Specified Items / Appendix 2 Restructured ABCP

    APPENDIX 1 │ DETAIL OF SPECIFIED ITEMS (millions of dollars) Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 Q3 10 Q4 10 Q1 11 Projects write-off - - - - - - - - - Write-off - - - - - - - (2) - Restructuration charge - - - - - - - (22) - Income taxes - - - - 25 - - 32 - Net Income - - - - 25 - - 8 - EPS - - - -

  19. Slide 19: Appendix 3 Preferred Shares / Appendix 4 Common Equity Tier 1 Definition

    APPENDIX 3 │ PREFFERED SHARES PERPETUAL NUMBER OF ANNUAL RATE % SHARES $ SHARES (millions of dollars) DIVIDEND (millions of dollars) Series 15 8,000,000 200 11.7 5.8% Note: assuming no change in Series 16 8,000,000 200 9.7 4.8% realized losses in the credit Series 20 6,900,000 173 10.4 6.0% indices

  20. Slide 20: Investor Relations

    Investor Relations Financial analysts and investors who want to obtain financial information on the Bank are asked to contact the Investor Relations Department. 600 De La Gauchetière Street West, 7th Floor Montreal, Quebec H3B 4L2 Toll-free: 1-866-517-5455 Fax: 514-394-6196 E-mail: investorrelations

National Bank of Canada — Q1 2011 Earnings Presentation on 6ix