Toronto-dominion Bank · TSX:TD
Toronto-dominion Bank — TD Bank Group — Investor Presentation (May 2011)
43 slides from Toronto-dominion Bank's investor presentation, May 2011
Slide 1: Investor Overview Presentation
Investor Overview Presentation May 2011
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 presentation, in other filings with Canadian regulators or the U.S. Securities and Exchange Commission, and in other communications. In addition, represent
Slide 3: Contents
Contents TD Bank Group Overview Key Businesses Credit Portfolio Canadian Economy and Financial System Other Information 2
Slide 4: Key Takeaways
Key Takeaways Simple Strategy, Consistent Focus Building the Better Bank North America North America • Top 10 Bank in North America1 • Leverage platform and brand for growth • One of the few banks in the world rated Aaa by Moody’s • Strong employment brand Retail Retail Earnings Earnings Focus Focus
Slide 5: A Top Bank in North America
TD Bank Group A Top 10 Bank in North America Compared to: Q2 20111 Canadian North American (In $U.S. Billions)2 Peers8 Peers9 Total Assets $666B 2nd 6th Total Deposits $463B 2nd 6th Market Cap3 $75B 2nd 6th Adj. Net Income4 (Trailing 4 Quarters) $5.5B 2nd 6th Adj. Retail Earnings5 (Trailing 4 Quarte
Slide 6: Financial Results
Financial Results (C$MM) Q2 2011 QoQ YoY F2010 YoY Revenue $5,122 -6% 7% $19,565 10% Provision for Credit Losses $343 -17% -6% $1,625 -34% Expenses $3,201 0.25% 8% $12,163 <1% Adjusted Net Income1 $1,451 -9% 18% $5,228 11% Adjusted EPS (diluted)2 $1.59 -9% 17% $5.77 8% Tier 1 Capital 12.70% Unchange
Slide 7: Lower Risk Retail Focus
Lower Risk Retail Focus1 Adjusted Earnings1 Global Wealth3 TD Ameritrade3,4 YTD 2011 C$3.04B 9% 3% Canadian P&C2 U.S. Retail 24% 20% 55% U.S. P&C2 Canadian Retail 13% 63% Wholesale 87% of earnings from retail operations 1. Based on adjusted results as defined on slide #3. Reported Net Income for Q1
Slide 8: Strong Focus on Risk-Return
Strong Focus on Risk-Return Return on Risk-Weighted Assets1 YTD 2011 2.88% 2.31% 1.51% 2 4 TD Canadian Peers 3 U.S. Peers Better return for risk undertaken 1. Adjusted on a comparable basis to exclude identified non-underlying items. Return on risk-weighted assets is adjusted net income available to
Slide 9: Managing through Current Environment
TD Bank Group: Managing through Current Environment Crossed the recession valley Carefully managed capital, funding, liquidity and risk Kept our business model intact Preserved our performance, convenience and service culture Emerged with momentum on our side Increased market share, extend
Slide 10: Strong, Consistent Dividend History
Strong, Consistent Dividend History Dividends Per Share1 Q1/11 Q1/11 Announced Announced $0.05 $0.05 (C$) dividend dividend increase increase33 $2.44 th Grow d alize nu Dividend An Yield % 11 3.1%2 $0.38 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 G
Slide 11: Simple Strategy, Consistent Focus, Superior Execution
Simple Strategy, Consistent Focus, Superior Execution Adjusted Earnings1 R $5,228 (C$MM) a r CAG s: 13% e g 5-y EarninS: 7% $4,716 d P uste dE Adj djuste A $4,189 $3,813 $3,376 $3,039 $2,861 Wholesale Banking U.S. P&C Wealth Management Canadian P&C 2005 2006 2007 2008 2009 2010 Q2 2011 YTD Retail as
Slide 12: Capital Ratios
Capital Ratios 16.3% Highlights 15.5% 14.9% Strong capital position Continued organic growth in 13.0% capital 12.0% ACM currently at 16.9x Minimum Total Capital Ratio Requirement (10%) Well‐positioned for evolving regulatory environment 10.3% 9.8% 11.3% 12.2% 12.7% Lower‐risk, franchise Mi
Slide 13: Key Takeaways
Key Takeaways Building the Better Bank North North America America Retail Retail Earnings Earnings Focus Focus Franchise Franchise Businesses Businesses Risk Risk Discipline Discipline 12
Slide 14: Contents
Contents TD Bank Group Overview Key Businesses Credit Portfolio Canadian Economy and Financial System Other Information 13
Slide 15: Key Businesses At a Glance
Key Businesses At a Glance Wealth Management Segments Business Canadian P&C1 U.S. P&C1 Wholesale Global Wealth TD Ameritrade2 Mix (YTD) Earnings Canadian Retail (63%) U.S. Retail (24%) Wholesale (13%) Brands 1. “P&C” refers to Personal and Commercial Banking. 2. TD had a reported investment in TD Am
Slide 16: Canadian Personal and Commercial Banking: Overview
Canadian Personal and Commercial Banking: Overview Key Businesses Canadian Banking Personal Banking Retail operations provide a full range of financial products and services. Approximately 11.5 million personal and small business customers. More than 1,100 branches across Canada. More th
Slide 17: Canadian Personal and Commercial Banking: Key Messages
Canadian Personal and Commercial Banking: Key Messages Lead in customer service and convenience Rated #1 by J.D. Power1 and Synovate2, year after year More than 50% longer branch hours than peers3 Now open Sundays in 300+ branches in 90 communities across Canada Integrated product offering
Slide 18: Canadian Personal and Commercial Banking: Performance
Canadian Personal and Commercial Banking: Performance Earnings ($MM) 5-year $3,095 CAGR 13%1 $2,472 $2,424 $2,253 $1,966 $1,702 $1,752 2005 2006 2007 2008 2009 2010 Q2 2011 YTD 1. 5-year CAGR is calculated based on compound annual growth from 2005 to 2010. 17
Slide 19: Wealth Management: Overview
Wealth Management: Overview Key Businesses Online Brokerage Canada U.S. 43.31% reported equity investment in TD Ameritrade1 Europe U.K., Ireland Luxembourg Advice-Based Businesses Canada As at Q2 2011 In C$ Financial Planning Private Investment Advice AUA2 $248B Full service
Slide 20: Wealth Management: Key Messages
Wealth Management: Key Messages Leading market positions #1 online brokerage in Canada1 #1 execution-only brokerage in the U.K.2 Integrated wealth organization Financial Planners based in retail bank branches Client referrals from TD retail businesses and between wealth management busine
Slide 21: Wealth Management: Performance
Wealth Management: Performance Earnings ($MM) $762 $769 5-year CAGR $641 8% 1 $590 $261 $289 $597 $194 $147 $432 $252 $388 Investment in $108 TD Ameritrade2 105 $501 $480 Global Wealth $443 $447 Management $324 $345 $283 2005 2006 2007 2008 2009 2010 Q2 2011 YTD 1. 5-year CAGR is calculated based on
Slide 22: U.S. Personal and Commercial Banking: Overview
U.S. Personal and Commercial Banking: Overview Key Businesses Personal Banking Over 1,250 stores More than 1,800 ATMs 24/7 live customer support As at Q2 2011 In C$ More than 6.5 million customers Total Assets $154B Total Deposits1 $144B Commercial Banking Offers a broad range of produ
Slide 23: U.S. Personal and Commercial Banking: Key Messages
U.S. Personal and Commercial Banking: Key Messages Lead in customer service and convenience Open longer hours than the competition including Sunday banking in most markets Rated highest customer satisfaction in Small Business Banking by Greenwich Excellence Awards1 in 2010 J.D. Power and A
Slide 24: U.S. Personal and Commercial Banking: Performance
U.S. Personal and Commercial Banking: Performance Adjusted Earnings1 ($MM) $1,042 $909 5-year $806 CAGR 2 45% $652 $359 $255 $158 C$ US$ $130 $224 $328 $794 $781 $1,008 $663 2005 2006 2007 2008 2009 2010 Q2 2011 YTD Purchased Privatized Acquired Completed Completed FDIC- Acquired Milestones 51% inte
Slide 25: Wholesale Banking: Overview
Wholesale Banking: Overview Key Businesses Investment Banking Advisory, underwriting, and corporate lending As at Q2 2011 In C$ Equities Risk Weighted Trading, facilitation, execution services, and research $31B Assets Adjusted Rates and Foreign Exchange Earnings1 $812MM Trading, facilit
Slide 26: Wholesale Banking: Key Messages
Wholesale Banking: Key Messages Focus on client-driven franchise businesses Focused on flow businesses with a presence in key global financial centres Evolved the business model by strategically repositioning the dealer to concentrate on core-client driven activities (eg: exited global structu
Slide 27: Wholesale Banking: Performance
Wholesale Banking: Performance Adjusted Earnings1 ($MM) $1,137 $987 $824 $664 $551 $417 $65 2005 2006 2007 2008 2009 2010 Q2 2011 YTD 1. See slide #3 for definition of adjusted results. Also see the Wholesale segment discussion in the Business Segment Analysis section in the 2002-2010 Annual Reports
Slide 28: Contents
Contents TD Bank Group Overview Key Businesses Credit Portfolio Canadian Economy and Financial System Other Information 27
Slide 29: Gross Lending Portfolio
Gross Lending Portfolio Loans and Acceptances Balances Q2 2011 U.S. P&C (C$B) Commercial 25% Residential Other Personal Banking (incl. Mtgs/Home Equity $71B Small Business 12% 7% Banking), 12% Other Personal, 3% Commercial Real Estate 4% Commercial & Residential 2/3 Industrial 8% insured Mtgs/HELOC
Slide 30: Credit Quality
Credit Quality Allowance for GILs / Gross NCOs / Avg (In %) Credit Losses / Loans + BAs Loans + BAs GILs 1 1.34 66.3 0.48 Cdn Peer Avg1 1.31 74.3 0.49 U.S. Peer Avg2 4.39 87.4 2.21 Well-positioned loan portfolio 1. Results are as of Q2/11 for TD and Canadian peers. Canadian Peers include other 4 big
Slide 31: Contents
Contents TD Bank Group Overview Key Businesses Credit Portfolio Canadian Economy and Financial System Other Information 30
Slide 32: Solid Financial System in Canada
Solid Financial System in Canada Strong retail and commercial banks Conservative lending standards All major wholesale dealers owned by Canadian banks, with stable retail earnings base to absorb any wholesale write-offs Responsive government and central bank Proactive policies and programs
Slide 33: Canadian Mortgage Market is Different from the U.S.
Canadian Mortgage Market is Different from the U.S. Canada U.S. Conservative product offerings: fixed or variable Outstanding mortgages include earlier exotic interest rate option products (interest only, options ARMs) Borrowers often qualified using discounted Default insured mortgages use
Slide 34: Canadian Economy: Outlook
Canadian Economy Outlook Unemployment rate to continue to trend down Inflation to remain in check Interest rates to rise gradually, but remain low Healthy business and relatively stable government balance sheets Overall GDP to grow at a healthy, modest rate Healthy, Steady Growth 33
Slide 35: Canadian Economy: Near-Term Outlook Somewhat Brighter
Canadian Economy Near-Term Outlook Somewhat Brighter Canadian Real GDP Annualized q/q % change 8 6 Forecast* Canadian economy enjoying a robust 4 recovery 2 0 -2 -4 -6 -8 -10 2008 2009 2010 2011 2012 *Forecast by TD Economics as at May 2011 Source: Statistics Canada, TD Economics Global monetary
Slide 36: Canadian Economy: Medium-Term Headwinds
Canadian Economy Medium-Term Headwinds Household Debt to Personal Disposable Income 180 % 160 United States 140 Gradual rise in interest rates to take steam out of debt-fueled consumer 120 spending 100 Canada 80 60 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 Source: Statistics Canada, T
Slide 37: Canadian Economy: Longer-Term Support
Canadian Economy Longer-Term Support Canadian Unemployment Percent 14 Unemployment rate has 12 peaked and continues to trend Forecast* downward 10 8 6 4 2 0 1970 1974 1978 1982 1986 1990 1994 1998 2002 2006 2010 2014 *Forecast by TD Economics as at March 2011 Source: Statistics Canada, TD Economic
Slide 38: Contents
Contents TD Bank Group Overview Key Businesses Credit Portfolio Canadian Economy and Financial System Other Information 37
Slide 39: Comparison to Global Banks
TD Bank Group Comparison to Global Banks Q2 20111 (U.S.$B)2 SAN BBVA RBS BNP CBA Total Assets $666 $1,630.4 $740.2 $2,267.1 $2,675.7 $664.9 Total Deposits $463 $825.4 $369.3 $796.5 $777.9 $404.6 Market Cap3 $75 $99.4 $51.3 $83 $92.7 $74.7 Tier 1 Capital Ratio 12.7% 10.0% 10.5% 12.9% 11.4% 9.7% Appro
Slide 40: Credit Ratings
Credit Ratings Ratings¹ Moody's S&P Fitch DBRS Aaa AA- AA- AA Strong credit ratings 1. Ratings on long term debt (deposits) of The Toronto-Dominion Bank, as at April 30, 2011. 39
Slide 41: Managing Environmental, Social, Governance Risks & Opportunities
Managing Environmental, Social, Governance Risks & Opportunities 1 One of the top 100 most sustainable companies in the world For the third year in a row One of only 8 companies in Canada Recognized by sustainability indices Dow Jones Sustainability Index North America Jantzi Social Inde
Slide 42: Investor Relations Contacts
Investor Relations Contacts Phone: 416-308-9030 or 1-866-486-4826 Email: tdir@td.com Grand Prix for Best Overall Investor Relations: Large Cap Website: Best Investor Relations by Sector: Financial Services www.td.com/investor Best Investment Community Meetings Best Investor Relations by a CEO: Large
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