Slide 1: Q3 2023 Conference Call Presentation
Q3 2023 Conference Call Presentation August 30, 2023 Follow us
Slide 2: Post Conference Call Q&A
2 Post Conference Call Q&A For those wishing to ask questions during the Q&A, please access today’s call through the telephone dial-in: Toll-free: 1 (888) 664-6392 (Canada/US) Local: (416) 764-8659
Slide 3: Advisory
3 Advisory The Bank occasionally makes forward-looking statements about its objectives, operations and targeted financial results. These statements may be written or verbal and may be included in such things as press releases, corporate presentations, annual reports and other disclosure documents an
Slide 4: David Taylor, President & Chief Executive Officer
4 David Taylor President & Chief Executive Officer
Slide 5: Q3 2023 highlights
5 Q3 2023 30% YoY growth in loan Realizing portfolio to record $3.66 B significant operating leverage inherent in Digital Banking model 39% YoY and 9% sequential growth in POS Loans & Leases Digital Banking efficiency Record revenue ratio at 43% Record net interest income Record EPS1 ROCE at 11.15%
Slide 6: Q3 2023 Key Metrics & Highlights: Record Results
6 Q3 2023 Key Metrics & Highlights: Record Results Consolidated Digital Banking: Strong loan portfolio growth to YoY Sequential another record: $3.66B Total Revenue 26% 1% Net Income 75% 3% Record quarterly revenue, NII and EPS1 EPS 90% - Temporary anomalous rate elevation in term Net Interest Margi
Slide 7: Acquisition of OCC-Chartered, National US Bank
Acquisition of OCC-Chartered, National US Bank: 7 Transformational Next Step in Long-Term Growth Strategy June 2022: Definitive • Provides access to US deposits to fuel growth of the US Agreement to Acquire Receivable Purchase Program business (launched in US Minnesota-based Stearns following succes
Slide 8: Shawn Clarke, Chief Financial Officer
8 Shawn Clarke Chief Financial Officer
Slide 9: Q3 2023: Continued Strong Financial Performance
9 Q3 2023: Continued Strong Financial Performance Balance Sheet • Total loan portfolio expanded to another record balance At July 31 2023 2022 YoY Sequential • Book Value per Share Change Change increased as a function of Total Assets $3.98 B $3.08 B 29% 7% higher retained earnings (from Loan Portfo
Slide 10: Q3 2023: Consolidated Income Statement
Q3 2023: Continued Strong Financial Performance 10 Consolidated Consolidated Income Statement • Revenue growth driven by higher NII from Digital Banking operations due 3 Months Ended mainly to strong POS portfolio growth July 31 • YoY revenue also benefitted from higher Sequential contribution of DR
Slide 11: Digital Banking Operations – Record Loan Portfolio
Q3 2023: Continued Strong Financial Performance 11 Digital Banking Operations – Record Loan Portfolio: $3.66 B Q2 2023 Q3 2023 Total: $3.42 B Total: $3.66 B Point-of-Sale Point-of-Sale Loans/ Leases Loans/ Leases $2.5B Public Sector/ $2.8B Public Sector/ 74% Other Financing 76% Other Financing $46M
Slide 12: Digital Banking Operations: Income Statement
Q3 2023: Continued Strong Financial Performance 12 Digital Banking Operations Digital Banking Operations: Income Statement 3 Months Ended • NIM on loans was dampened by July 31 higher rates paid on term deposits during the quarter amidst 2023 2022 YoY Change Seq Change temporarily elevated rates in
Slide 13: Cost of Funds
13 Cost of Funds Q3 2023 cost of funds: 3.62% Wealth Management (Personal Deposits) • Increased 168 bps (87%) vs Q3 2022 • Increased 35 bps (11%) vs Q2 2023 Cost of funds was impacted by higher $2,724 $2,059 rates paid on term deposits during the $1,108 $1,203 $1,150 $1,052 $1,041 $1,059 $1,213 $960
Slide 14: PCL as a % of Average Loans
14 Top Tier Asset Quality & Prudent Approach to Risk Mitigation Average Provision for Credit 0.12% Losses as a % of Average Loans PCL as a % of Average Loans (0.01%) 0.08% (Trailing 12-Quarters) 0.06% 0.02% 0.02% 0.03% (0.01%) (0.02%) (0.02%) (0.02%) 2014 2015 2016 2017 2018 2019 2020 2021 2022 Q3 2
Slide 15: DRTC Cybersecurity Services Income Statement
Q3 2023: Continued Strong Financial Performance 15 DRTC Cybersecurity Services (DBG): Income Statement • Revenue changes are a 3 Months Ended function of engagement July 31 activity relative to YoY Seq comparable periods 2023 2022 Change Change Revenue 2.4 2.1 10% -8% • YoY increase in gross profit
Slide 16: David Taylor, President & Chief Executive Officer
16 David Taylor President & Chief Executive Officer
Slide 17: Near-Term Targets
Capitalizing on the Significant Operating Leverage 17 in Our Core Digital Banking Operations Near-Term Targets Period of Investment in Future Growth $3.98 Total Assets >$4B >$5B $3.27 62% $3.66 $2.42 $2.99 11.15% 9.30% 10.29% 8.68% 55% 8.20% 8.28% $1.79 $1.73 $1.81 $1.94 52% Efficiency Ratio $1.59 4
Slide 18: Q&A Session
Q&A Session Toll Free Dial In (Canada/US): 1 (888) 664-6392 Local Dial In: (416) 764-8659
Slide 19: Our Time Has Arrived!
19 Our Time Has Arrived! Follow us