Toronto-dominion Bank · TSX:TD

Toronto-dominion Bank — TD Bank Group — Q4 2016 Earnings Presentation

36 slides from Toronto-dominion Bank's earnings presentation, 2016

  1. Slide 1: TD Bank Group Investor Presentation

    TD Bank Group Investor Presentation Q4 2016

  2. 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

  3. Slide 3: TD Bank Group – Key Themes

    TD Bank Group – Key Themes 6th largest bank 1 Top 10 North American Bank by Total Assets1 6th largest bank by Market Cap1 Delivering top tier long 2 Proven Performance term shareholder returns2 Highly rated 3 Strong Balance Sheet and Capital Position by major credit rating agencies Targeting 7-10% 4

  4. Slide 4: TD Snapshot

    TD Snapshot Our Businesses Canadian Retail  Personal banking, credit cards and auto finance  Small business and commercial banking  Direct investing, advice-based wealth businesses, and asset management  Property, casualty, life and health insurance Q4 20161 Canadian U.S. U.S. Retail (C$ except

  5. Slide 5: TD Strategy

    TD Strategy To be the Better Bank North America  Top 10 Bank in North America1  Leverage platform and brand for growth  One of only a few banks globally to be rated Aa1 by Moody’s2  Strong employment brand Retail Earnings Focus  Leader in customer service and convenience  Strong organic growth

  6. Slide 6: Competing in Attractive Markets

    Competing in Attractive Markets Country Statistics Country Statistics  10th largest economy  World’s largest economy  Nominal GDP of C$1.5 trillion  Nominal GDP of US$18.6 trillion  Population of 36 million  Population of 322 million Canadian Banking System U.S. Banking System  One of the sou

  7. Slide 7: TD in North America

    TD in North America North Q4 2016 Canadian American C$ except otherwise noted Ranking3 Ranking4 Total assets $1,177B 2nd 6th Total deposits $774B 1st 5th Market capitalization $113B 2nd 6th Reported net income (trailing four quarters) $8.5B 2nd 6th Adjusted net income1 (trailing four quarters) $9.3B

  8. Slide 8: Composition of Earnings

    Composition of Earnings 2016 Reported Earnings Mix1 Three key business lines  Canadian Retail robust retail banking platform in Canada with proven performance U.S. Retail2  U.S. Retail top 10 bank4 in 26% Canadian the U.S. with significant Retail organic growth opportunities 61%  Wholesale Bankin

  9. Slide 9: Strategic Evolution of TD

    Strategic Evolution of TD Increasing Retail Focus Acquired TD Acquired Target credit Became primary issuer Announced Chrysler Completed strategic Acquired Waterhouse Acquired Commerce Acquired card portfolio & Epoch; of Aeroplan Visa; agreement to Privatized Financial credit card 51% of USA / Commer

  10. Slide 10: Risk Management Framework

    Risk Management Framework Our Risk Appetite We take risks required to build our business, but only if those risks:  Fit our business strategy and can be understood and managed  Do not expose the enterprise to any significant single loss events; we don’t “bet the bank” on any single acquisition, bu

  11. Slide 11: TD Bank Group – Key Themes

    TD Bank Group – Key Themes 6th largest bank 1 Top 10 North American Bank by Total Assets1 6th largest bank by Market Cap1 Delivering top tier long 2 Proven Performance term shareholder returns2 Highly rated 3 Strong Balance Sheet and Capital Position by major credit rating agencies Targeting 7-10% 4

  12. Slide 12: Stable Earnings Growth

    Stable Earnings Growth Reported Earnings1,2 (C$MM) $8,936 $8,024 Wholesale Banking $7,883 U.S. Retail $6,460 $6,640 Canadian Retail 2012 2013 2014 2015 2016 Targeting 7-10% adjusted EPS growth4 over the medium term 1. For the purpose of calculating contribution by each business segment, earnings fro

  13. Slide 13: Solid Total Shareholder Returns

    Solid Total Shareholder Returns Total Shareholder Return1 TD Compounded Annual Growth Rates (CAGR) Canadian peer average2 North American peer average3 17.9% 15.4% 14.2% 14.3% 12.4% 12.6% 9.6% 10.4% 8.5% 7.8% 7.1% 2.5% 1 Year 3 Years 5 Years 10 Years Delivering top tier long-term shareholder returns

  14. Slide 14: Strong, Consistent Dividend History

    Strong, Consistent Dividend History Dividends Per Share (C$) $2.16 Q1/16: Announced $0.04 dividend increase Dividend yield: 3.7%1 Q3/12: $0.22 Increased target payout range to 40%-50%2 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Divid

  15. Slide 15: Q4 2016 Highlights

    Q4 2016 Highlights Financial Highlights C$MM Total Bank Reported Results (YoY) Reported Q4/16 Q3/16 Q4/15 EPS up 25% (7% adjusted1) Revenue 8,745 8,701 8,047 PCL 548 556 509 Revenue up 9% Expenses 4,848 4,640 4,911  Adjusted revenue up 6% ex FX and acquisitions2 Net Income 2,303 2,358 1,839 Diluted

  16. Slide 16: Q4 2016 Segment Results Highlights

    Q4 2016 Segment Results Highlights  Net income of $1.5 billion, an increase of $6 million, reflecting revenue growth and lower insurance claims, largely offset by margin compression, higher non-interest expenses, the impact of a higher tax rate and increased PCL Canadian  PCL up 2% QoQ Retail  Ex

  17. Slide 17: Strong Credit Quality

    Strong Credit Quality GIL and PCL Ratios (bps) 83 81 78 66 65 63 61 60 63 58 59 58 56 50 50 43 45 39 42 37 38 39 34 37 34 26 31 25 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Q1/16 Q2/16 Q3/16 Q4/16 IFRS Gross Impaired Loans / Gross Loans and Acceptances (bps) Provision for Credit Losses / Ave

  18. Slide 18: Oil and Gas Exposure

    Oil and Gas Exposure Corporate and Commercial Outstandings Highlights by Sector (C$B):  Oil and Gas Producers and Services outstandings reduced $400MM representing less than 1% of total gross loans and acceptances $3.1 $2.9  65% of undrawn Oil & Gas exposure is investment grade $1.2 / 39%  Exclud

  19. Slide 19: TD Bank Group – Key Themes

    TD Bank Group – Key Themes 6th largest bank 1 Top 10 North American Bank by Total Assets1 6th largest bank by Market Cap1 Delivering top tier long 2 Proven Performance term shareholder returns2 Highly rated 3 Strong Balance Sheet and Capital Position by major credit rating agencies Targeting 7-10% 4

  20. Slide 20: Attractive Balance Sheet Composition

    Attractive Balance Sheet Composition1 Funding Mix2 Wholesale Term Debt Sub-Debt 1% Personal Non- Covered Trading Term Deposits Bonds Deposits5 40% 26% 8% Wholesale Senior Personal Term Unsecured Term Debt Assets Mortgage Deposits 11% MTN6 5% Securitized Securitization 16% 53% 21% Other Deposits3 26%

  21. Slide 21: Gross Lending Portfolio

    Gross Lending Portfolio Balances Highlights Q4/16 Canadian Retail Portfolio $ 372.2 Personal $ 309.1 Canadian Portfolio Residential Mortgages 189.0  Real estate secured lending gross loans Home Equity Lines of Credit (HELOC) 65.0 outstanding up 4% YoY Indirect Auto 20.6  C$254 billion portfolio (5

  22. Slide 22: Capital & Liquidity

    Capital & Liquidity Common Equity Tier 11 Highlights  Common Equity Tier 1 ratio of 10.4% Q3 2016 CET1 Ratio 10.4%  Leverage ratio of 4.0% Internal capital generation 31 bps RWA increase and other (24) bps  Liquidity coverage ratio of 130% Actuarial loss on employee pension plans (4) bps  Tier 1

  23. Slide 23: TD Credit Ratings

    TD Credit Ratings Issuer Ratings1 Accolades Moody's S&P DBRS  “Safest Bank in North America & One of the World’s 50 Safest Banks” Ratings Aa1 AA- AA – Global Finance Magazine  “Best Bank in Canada” Outlook Negative Stable Negative – Euromoney Magazine Ratings vs. Peer Group S&P Long-Term Debt Rati

  24. Slide 24: TD Bank Group – Key Themes

    TD Bank Group – Key Themes 6th largest bank 1 Top 10 North American Bank by Total Assets1 6th largest bank by Market Cap1 Delivering top tier long 2 Proven Performance term shareholder returns2 Highly rated 3 Strong Balance Sheet and Capital Position by major credit rating agencies Targeting 7-10% 4

  25. Slide 25: Canadian Retail

    Canadian Retail Consistent Strategy Reported Net Income (C$MM) $5,938 $5,988 How we compete $5,234 $4,463 $4,569  Legendary customer service and convenience  Relentless commitment to operational excellence  The power of One TD $4,567 $4,681 $5,490 $5,938 $5,988 Adjusted1  Winning culture and tea

  26. Slide 26: Canadian Retail

    Canadian Retail Personal Banking  #1 or #2 market share in most retail products1  On average 45% longer branch hours than peers2 with 431 branches offering Sunday banking  Mobile banking leadership in Canada with the highest number of mobile unique visitors accessing financial services3 Business

  27. Slide 27: U.S. Retail

    U.S. Retail Reported Net Income Consistent Strategy (US$MM) $2,234 How we compete $1,938 $2,007 $1,715  Legendary service and convenience $1,318  Grow and deepen customer relationships  Differentiated brand as the “human” bank $2,053 $2,234 Adjusted1  Productivity initiatives that enhance $1,611

  28. Slide 28: U.S. Retail

    U.S. Retail Personal & Commercial Banking  Top 10 bank1 with ~9MM customers, operating retail stores in 15 states and the District of Columbia  Open longer than the competition, including Sunday banking in most markets  #3 market share in NYC2 and targeting top 5 market share in all of our major

  29. Slide 29: Wholesale Banking

    Wholesale Banking Consistent Strategy Net Income (C$MM) $920 How we compete $880 $813 $873 Canada $650  Be a top-ranked integrated investment dealer  Fully aligned with TD Bank Group partners  Provide superior advice and execution U.S.  Growing our US$ product suite across Corporate, 2012 2013 2

  30. Slide 30: Wholesale Banking

    Wholesale Banking Focus on client-driven franchise businesses  Diversified business mix with a North American focus  Presence in key global financial centres  Extend our client-focused franchise business through superior advice and execution A North American dealer aligned with our TD partners 

  31. Slide 31: Omni Comfort and Convenience

    Omni Comfort and Convenience Consistent Strategy Digital Enhancements How we compete  Customer-centricity allows customers to choose how, when and where they bank Completely redesigned TD Bank app for iOS TD for Me is a feature of the Canadian TD app that and Android devices with more than 20 new a

  32. Slide 32: Corporate & Social Responsibility

    Corporate & Social Responsibility  TD Friends of the Environment Foundation celebrates 25 years with over Highlights C$76 million in funds disbursed in support of more than 24,000 local environmental projects  Ranked 54th on the Global 100 Most Sustainable  More than 235,000 trees planted through

  33. Slide 33: A Principled Approach

    A Principled Approach Leadership Profile Guiding Principles  Deliver Legendary Customer  Make an Impact and Value Speed Experiences  Build for the Future  Be an Extraordinary Place to Work  Inspire the Will to Win  Operate with Excellence  Act Decisively while Working Effectively in Teams  U

  34. Slide 34: TD Model Has Proven Its Resilience

    TD Model Has Proven Its Resilience Simple Strategy Vision: Consistent Focus To be The Better Bank  Lead with service and Headwinds  Best Bank in Canada1 convenience Slowing loan growth in Canada  One of Canada’s most  Leverage TD brand across all segments valuable brands2 Low interest rate envir

  35. Slide 35: Investor Relations Contacts

    Investor Relations Contacts Phone: 416-308-9030 or 1-866-486-4826 Email: Best Investor Relations by tdir@td.com Sector: Financial Services Best Corporate Governance Website: www.td.com/investor 34

  36. Slide 36: TD Bank Group Investor Presentation

    TD Bank Group Investor Presentation Q4 2016

TD Bank Group — Q4 2016 Earnings Presentation on 6ix