Toronto-Dominion Bank · TSX:TD
Toronto-Dominion Bank — TD Bank Group — Q3 2016 Earnings Presentation
28 slides from Toronto-Dominion Bank's earnings presentation, Aug 25, 2016
Slide 1: TD Bank Group Q3 2016 Quarterly Results Presentation
TD Bank Group Q3 2016 Quarterly Results Presentation Thursday August 25th, 2016
Slide 2: Caution Regarding Forward-Looking Statements
Caution Regarding Forward-Looking Statements From time to time, the Bank (as defined in this document) makes written and/or oral forward-looking statements, including in this document, in other filings with Canadian regulators or the United States (U.S.) Securities and Exchange Commission (SEC), and
Slide 3: Overview
Overview Reported earnings of $2.4 billion up 4% YoY Adjusted1 earnings of $2.4 billion up 6% YoY Reported retail2 earnings up 3% YoY (up 4% YoY on an adjusted basis) Wholesale earnings up 26% YoY Credit quality strong overall Reported EPS of $1.24 up 4% YoY Adjusted EPS of $1.27 up 6% YoY
Slide 4: Accomplishments
Accomplishments Supporting our Customers Strong fundamentals in Canadian Retail – support for the rebuilding effort in Fort McMurray Record quarter in U.S. Retail – continued gains in household acquisition and customer penetration Strong performance in Wholesale – several marquee transactions
Slide 5: Q3 2016 Highlights
Q3 2016 Highlights Financial Highlights $MM Total Bank Reported Results (YoY) Reported Q3/16 Q2/16 Q3/15 Earnings up 4% (6% adjusted1) Revenue 8,701 8,259 8,006 PCL 556 584 437 EPS up 4% (6% adjusted) Expenses 4,640 4,736 4,292 Net Income 2,358 2,052 2,266 Revenue up 9% Diluted EPS ($) 1.24 1.07 1.1
Slide 6: Canadian Retail
Canadian Retail Highlights (YoY) P&L $MM Q3/16 QoQ YoY Earnings down 3% Revenue 5,141 5% 3% Insurance Claims 692 31% 15% Revenue up 3% Revenue Net of Claims1 4,449 2% 1% Loan volumes up 5% PCL 258 (2%) 9% Deposit volumes up 8% Expenses 2,133 2% 1% Wealth assets2 up 7% Net Income 1,509 3% (3%)
Slide 7: U.S. Retail
U.S. Retail Highlights US$MM (YoY) P&L US$MM (except where noted) Reported Adjusted Reported earnings up 12% (16% adjusted1) Q3/16 QoQ YoY YoY Revenue up 7% Revenue 1,810 5% 7% 7% PCL 130 6% 7% 7% Loan volumes up 13% Expenses 1,058 (1%) 6% 3% Deposit volumes up 9% U.S. Retail Bank 512 12% 9% 14%
Slide 8: Wholesale Banking
Wholesale Banking Highlights (YoY) P&L $MM Earnings up 26% Q3/16 QoQ YoY Revenue 859 12% 12% Revenue up 12% PCL 11 (78%) >100% Increased capital markets origination activity and Expenses 437 (1%) 1% corporate lending fees Net Income 302 38% 26% Higher trading-related revenue of $447MM ROE 20.4%
Slide 9: Corporate Segment
Corporate Segment Highlights (YoY) P&L $MM Reported Q3/16 Q2/16 Q3/15 Reported loss up $37MM (adjusted1 $22MM) Net Income (241) (350) (204) Ongoing investment in enterprise and regulatory projects Adjusted1 Q3/16 Q2/16 Q3/15 Higher provisions for incurred but not identified Net Corporate Expense
Slide 10: Capital & Liquidity
Capital & Liquidity Highlights Common Equity Tier 11 Common Equity Tier 1 ratio of 10.4% Q2 2016 CET1 Ratio 10.1% Leverage ratio of 3.8% Internal capital generation 33 bps Actuarial loss on employee pension plans (9) bps Liquidity coverage ratio of 132% RWA increase and other 1 bps Q3 2016 CET1 Rati
Slide 11: Gross Impaired Loan Formations
Gross Impaired Loan Formations By Portfolio Highlights GIL Formations1: $MM and Ratios2 Total formations reduced $1,717 $229MM or 4 bps for the quarter U.S. Retail formations quarterly $1,453 decrease of $122MM primarily $1,338 driven by: $1,206 $142 / 38 bps $1,224 $33 / 10bps US$57MM reducti
Slide 12: Gross Impaired Loans (GIL)
Gross Impaired Loans (GIL) By Portfolio Highlights GIL1: $MM and Ratios2 Canadian Retail GIL rate remains $3,799 $39 / 10 bps $3,567 at cyclically low levels $3,467 $3,244 U.S. Retail GIL quarterly decrease $3,077 $178 / 48 bps $211 / 54 bps $55 / 16 bps of $105MM primarily due to: $36 / 12 bps
Slide 13: Provision for Credit Losses (PCL)
Provision for Credit Losses (PCL) By Portfolio Highlights PCL1: $MM and Ratios2 $648 Canadian and U.S. credit quality $10 / 11 bps $592 remains strong $563 $550 $65 / NM $48 / 53 bps $9 / 10 bps $34MM increase for U.S. Retail6 $11 / 14 bps $40 / NM driven by volume growth $443 $36 / NM $60 / NM
Slide 14: Oil and Gas Exposure
Oil and Gas Exposure Corporate and Commercial Outstandings Highlights by Sector ($B): Oil and Gas Producers and Services outstandings reduced $300MM and $3.5 remain less than 1% of total gross loans and acceptances $2.8 65% of undrawn Oil & Gas exposure is $1.4 / 40% investment grade Excluding
Slide 15: Appendix
Appendix
Slide 16: Q3 2016 Earnings: Items of Note
Q3 2016 Earnings: Items of Note MM EPS Reported net income and EPS (diluted) $2,358 $1.24 Revenue/ Pre Tax After Tax Items of note EPS Segment Expense (MM) (MM) Line Item3 Amortization of intangibles1 $63 $58 $0.03 Corporate page 9, line 10 Excluding Items of Note above Adjusted2 net income and EPS
Slide 17: Canadian Retail
Canadian Retail Net Interest Margin Average Deposits $B 274 284 264 268 272 20 21 19 19 19 2.88% 2.84% 91 84 84 85 85 2.80% 2.79% 2.77% 161 165 167 169 172 Q3/15 Q4/15 Q1/16 Q2/16 Q3/16 Q3/15 Q4/15 Q1/16 Q2/16 Q3/16 Personal Business Wealth Efficiency Ratio Average Loans $B 354 359 361 365 347 57 58
Slide 18: Canadian Wealth
Canadian Wealth Wealth Revenue $MM Wealth Assets $B 927 875 864 879 883 120 117 113 118 116 337 122 308 321 116 112 133 314 310 115 265 249 245 247 254 642 649 685 636 634 Q3/15 Q4/15 Q1/16 Q2/16 Q3/16 Q3/15 Q4/15 Q1/16 Q2/16 Q3/16 Fee & Other Transaction NII AUA AUM 18
Slide 19: U.S. Retail
U.S. Retail Net Interest Margin1 Average Deposits US$B 214 218 224 225 206 3.14% 3.11% 79 81 84 84 3.11% 76 3.08% 58 61 62 62 62 3.05% 73 73 75 78 79 Q3/15 Q4/15 Q1/16 Q2/16 Q3/16 Q3/15 Q4/15 Q1/16 Q2/16 Q3/16 Personal Business TD Ameritrade IDAs 4 Efficiency Ratio2 Average Loans US$B 134 134 138 67
Slide 20: U.S. Retail
U.S. Retail TD Wealth Assets US$B TD Ameritrade1 74 77 TD’s share of TD Ameritrade’s net income 71 72 71 was C$125MM in Q3/16, up 37% YoY mainly due to: FX translation, asset growth, higher trading volumes and favourable tax liability adjustment TD Ameritrade results: Net income US$240 MM in Q3/
Slide 21: Canadian Housing Market
Canadian Housing Market Portfolio Q3/16 Gross Loans Outstanding $252 B Canadian RESL Percentage Insured 51% Uninsured Residential Mortgages Current LTV1 58% Condo Mortgage Gross Loans Outstanding $32 B Percentage Insured 62% Gross Loans Outstanding $6 B Condo HELOC Percentage Insured 27% Condo Borro
Slide 22: Gross Lending Portfolio
Gross Lending Portfolio Includes B/As Balances (C$B unless otherwise noted) Q2/16 Q3/16 Canadian Retail Portfolio $ 361.9 $ 368.4 Personal $ 300.9 $ 306.0 Residential Mortgages 185.7 187.7 Home Equity Lines of Credit (HELOC) 62.0 63.9 Indirect Auto 19.7 20.4 Unsecured Lines of Credit 9.6 9.8 Credit
Slide 23: Canadian Personal Banking
Canadian Personal Banking Q3/16 Gross Loans GIL GIL / Highlights Canadian Personal Banking1 ($B) ($MM) Loans Credit quality remains strong Residential Mortgages 188 406 0.22% in the Canadian Personal Home Equity Lines of Credit (HELOC) 64 155 0.24% Indirect Auto 20 67 0.33% portfolio Unsecured Lin
Slide 24: Canadian Commercial and Wholesale Banking
Canadian Commercial and Wholesale Banking Q3/16 Canadian Commercial and Gross Highlights GIL GIL/ Loans/BAs Wholesale Banking ($B) ($MM) Loans Solid loan growth across Commercial Banking1 62 179 0.29% the Canadian Commercial Wholesale 39 211 0.54% and Wholesale Banking Total Canadian Commercial an
Slide 25: U.S. Personal Banking – U.S. Dollars
U.S. Personal Banking – U.S. Dollars Q3/16 U.S. Personal Banking1 Gross Loans GIL GIL / Highlights ($B) ($MM) Loans Residential Mortgages 20 333 1.64% Continued good asset quality Home Equity Lines of Credit (HELOC)2 10 691 6.97% in U.S. Personal Indirect Auto 21 139 0.67% Improving trend in for
Slide 26: U.S. Commercial Banking – U.S. Dollars
U.S. Commercial Banking – U.S. Dollars Q3/16 U.S. Commercial Banking1 Gross Loans GIL GIL/ Highlights / BAs ($B) ($MM) Loans Commercial Real Estate (CRE) 21 129 0.61% Continuing portfolio growth Non-residential Real Estate 16 88 0.55% and good quality in U.S. Residential Real Estate 5 41 0.82% Com
Slide 27: Investor Relations Contacts
Investor Relations Contacts Phone: 416-308-9030 or 1-866-486-4826 Email: tdir@td.com Website: Best Investor Relations by Sector: Financial Services www.td.com/investor Best Corporate Governance
Slide 28: TD Bank Group Q3 2016 Quarterly Results Presentation
TD Bank Group Q3 2016 Quarterly Results Presentation Thursday August 25th, 2016