Toronto-dominion Bank · TSX:TD
Toronto-dominion Bank — TD Bank Group — Q4 2019 Earnings Presentation
34 slides from Toronto-dominion Bank's earnings presentation, Dec 5, 2019
Slide 1: TD Bank Group Q4 2019 Quarterly Results Presentation
TD Bank Group Q4 2019 Quarterly Results Presentation Thursday, December 5, 2019
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: Our Strategy
Our Strategy Shape tomorrow TD aims to stand out from its peers by having a differentiated brand – anchored in our proven business model, and rooted in a desire to give our customers, communities and colleagues the confidence to thrive in a changing world. Proven business model Forward Focused Purpo
Slide 4: Proven Business Model
Proven Business Model Consistent earnings growth, underpinned by a strong risk culture ▪ Fiscal 2019 reported earnings up 3% (adjusted up 3%)1 ▪ Fiscal 2019 reported EPS up 4% (adjusted up 3%)1 ▪ Increased dividend paid by 11% over the full year ▪ Above peer average total shareholder return over 3,
Slide 5: Forward-focused
Forward-focused Shaping the future of banking TD Cyber Fusion Centre TD Helps Responsible AI TD Helps ? Highest in Customer Satisfaction for Small Business Supporting the Green TD Wheels App 2019 Lipper Awards1 Banking in the South Region and Sustainable Bond J.D. Power 2019 U.S. Retail Banking Sati
Slide 6: Purpose-driven
Purpose-driven Centered on our vision, purpose and shared commitments TD's Ready TD Mindpower: 2019 Annual Report Commitment Network Analytics for Social Good 6
Slide 7: Fiscal 2019 Highlights
Fiscal 2019 Highlights Total Bank Reported Results (YoY) Financial Highlights $MM Reported 2019 2018 YoY EPS up 4% (3% adjusted)1 Revenue 41,065 38,892 6% Revenue up 6% PCL 3,029 2,480 22% Expenses 22,020 20,195 9% Expenses up 9% Net Income 11,686 11,334 3% ▪ Includes charges related to Air Canada,
Slide 8: Q4 2019 Highlights
Q4 2019 Highlights Total Bank Reported Results (YoY) Financial Highlights $MM Reported Q4/19 Q3/19 Q4/18 EPS down 3% Revenue 10,340 10,499 10,136 ▪ Adjusted1 EPS down 2% PCL 891 655 670 Revenue up 2% Expenses 5,543 5,374 5,366 Net Income 2,856 3,248 2,960 Expenses up 3% Diluted EPS ($) 1.54 1.74 1.5
Slide 9: Canadian Retail
Canadian Retail Highlights (YoY) P&L $MM Reported Q4/19 QoQ YoY Net income flat (up 2% adjusted)1 Revenue 6,133 0% 5% Insurance Claims 705 (1%) 3% Revenue up 5% Revenue Net of Claims2 5,428 0% 5% ▪ Loan volumes up 5% PCL 400 27% 52% ▪ Deposit volumes up 5% Expenses 2,637 4% 4% ▪ Wealth assets3 up 14
Slide 10: U.S. Retail
U.S. Retail Highlights US$MM (YoY) P&L US$MM (except where noted) YoY Q4/19 QoQ YoY Net income up 5% (3% adjusted)1 Adj.1 Revenue 2,230 (1%) 2% 2% Revenue up 2% PCL 223 17% 19% 19% ▪ Loan volumes up 7% Expenses 1,261 4% 0% 0% ▪ Deposits ex-TD Ameritrade up 5% U.S. Retail Bank Net Income 681 (9%) 0%
Slide 11: Wholesale Banking
Wholesale Banking Highlights (YoY) P&L $MM Q4/19 QoQ YoY Net income down 44% Revenue 848 (7%) (9%) Revenue down 9% PCL 41 NM NM ▪ Includes $96MM in derivative valuation charges Expenses 600 1% 9% Net Income 160 (34%) (44%) Expenses up 9% YoY ROE 8.5% ▪ Includes $23MM of restructuring charges Earning
Slide 12: Corporate Segment
Corporate Segment Highlights (YoY) P&L $MM Reported Q4/19 Q3/19 Q4/18 Reported loss of $240MM Net Income (240) (173) (181) ▪ Adjusted1 loss of $178MM Adjusted1 Q4/19 Q3/19 Q4/18 Net Corporate Expenses (201) (156) (221) Other 23 47 85 Non-Controlling Interests 0 0 18 Net Income (178) (109) (118) 1. A
Slide 13: Capital & Liquidity
Capital & Liquidity Highlights Common Equity Tier 1 Common Equity Tier 1 ratio of 12.1% Q3 2019 CET1 Ratio 12.0% Leverage ratio of 4.0% Internal capital generation 32 Organic RWA increase and other (4) Liquidity coverage ratio of 133% Actuarial losses on employee pension plans (5) Repurchased 8.75 m
Slide 14: Gross Impaired Loan Formations
Gross Impaired Loan Formations By Business Segment Highlights GIL Formations1: $MM and Ratios2 ▪ Gross impaired loan formations stable quarter- 26 21 20 21 22 bps over-quarter at 22 basis points $1,722 $1,516 $1,459 $9 / 2 bps $1,424 $19 / 4 bps $1,340 $1,117 / 55 bps $725 / 36 bps $758 / 36 bps $83
Slide 15: Gross Impaired Loans (GIL)
Gross Impaired Loans (GIL) By Business Segment Highlights GIL1: $MM and Ratios2 ▪ Gross impaired loans stable quarter-over-quarter at 43 47 53 48 basis points 42 43 bps $3,534 $3,154 $3,296 $2,945 $3,032 $27 / 5 bps $19 / 3 bps $2,590 / 126 bps $2,356 / 112 bps $1,933 / 91 bps $2,225 / 110 bps $1,90
Slide 16: Provision for Credit Losses (PCL)
Provision for Credit Losses (PCL) By Business Segment Highlights PCL1: $MM and Ratios2 $893 ▪ PCL increased $229MM $855 $7 $41 quarter-over-quarter reflecting: $675 $664 $155 $8 $227 $636 $1 ▪ The U.S. Credit Card and $83 Auto Portfolios, largely due $155 $132 $297 to seasonal trends $311 $264 ▪ The
Slide 17: Provision for Credit Losses (PCL): Impaired and Performing
Provision for Credit Losses (PCL)1,2 Impaired and Performing Highlights PCL (C$MM) Q4/18 Q3/19 Q4/19 ▪ Impaired PCL increase Total Bank $ 675 $ 664 $ 893 quarter-over-quarter driven by: Impaired 564 590 741 ▪ The U.S. Credit Card and Performing 111 74 152 Auto portfolios, reflecting Canadian Retail
Slide 18: Appendix
Appendix
Slide 19: Q4 2019: Items of Note
Q4 2019: Items of Note $MM EPS ($) Reported net income and EPS (diluted) 2,856 1.54 Revenue/ Items of Note Pre Tax After Tax EPS Segment Expense Line Item4 Amortization of intangibles1 74 62 0.03 Corporate page 8, line 14 Charges associated with the Greystone Acquisition2 30 28 0.02 Canadian Retail
Slide 20: Fiscal 2019: Items of Note
Fiscal 2019: Items of Note $MM EPS ($) Reported net income and EPS (diluted) 11,686 6.25 After Revenue/ Expense Items of note Pre Tax EPS Segment Tax Line Item5 Amortization of intangibles1 307 259 0.14 Corporate page 8, line 14 Charges related to the agreement with Air Canada2 607 446 0.24 Canadian
Slide 21: Canadian Retail
Canadian Retail Net Interest Margin Average Deposits $B 331 332 337 344 328 24 25 24 25 24 113 111 113 116 2.99% 113 2.94% 2.94% 2.96% 2.96% 192 194 197 200 203 Q4/18 Q1/19 Q2/19 Q3/19 Q4/19 Q4/18 Q1/19 Q2/19 Q3/19 Q4/19 Personal Business Wealth Efficiency Ratio Average Loans $B 419 421 427 434 415
Slide 22: Canadian Retail: Wealth
Canadian Retail: Wealth Wealth Revenue $MM Wealth Assets $B1 1,094 1,129 1,123 1,069 1,086 167 165 159 162 160 128 127 421 422 132 137 419 157 396 389 349 350 353 332 289 800 789 834 831 753 Q4/18 Q1/19 Q2/19 Q3/19 Q4/19 Q4/18 Q1/19 Q2/19 Q3/19 Q4/19 Fee & Other Transaction NII AUA AUM 22 1. Canadia
Slide 23: Canadian Retail Digital Metrics
Canadian Retail Digital Metrics1 ▪ #1 average digital reach of any bank in Canada and as compared to major developed markets globally, amongst the leaders in domestic digital reach, according to Comscore.2,3 ▪ According to App Annie, TD (Canada) is ranked #1 in consumer demand, customer engagement,
Slide 24: U.S. Retail
U.S. Retail Net Interest Margin1,2 Average Deposits US$B 264 266 265 265 271 3.42% 107 109 105 103 106 3.38% 3.33% 3.27% 69 68 68 70 73 3.18% 88 90 92 92 92 Q4/18 Q1/19 Q2/19 Q3/19 Q4/19 Q4/18 Q1/19 Q2/19 Q3/19 Q4/19 4 Personal Business TD Ameritrade IDAs Efficiency Ratio3 Average Loans US$B 156 157
Slide 25: U.S. Retail: Wealth and TD Ameritrade
U.S. Retail: Wealth and TD Ameritrade TD Wealth Assets US$B1 TD Ameritrade2 – Q4 2019 52 TD’s share of TD Ameritrade’s net income was 47 US$219MM, up 25% YoY (13% on an adjusted3 46 44 43 basis) reflecting: ▪ Higher asset-based revenue and charges associated with Scottrade in the same quarter last y
Slide 26: U.S. Retail Digital Metrics
U.S. Retail Digital Metrics1 ▪ The TD Bank U.S. mobile app is highly rated for customer engagement metrics, including average open rate and average sessions per user, as well as customer satisfaction – as indicated by strong average rating scores among U.S. large cap /regional banks according to App
Slide 27: Gross Lending Portfolio
Gross Lending Portfolio Includes B/As Balances ($B unless otherwise noted) Q3/19 Q4/19 Canadian Retail Portfolio $429.5 $434.1 Personal $349.6 $353.5 Residential Mortgages 197.5 200.0 Home Equity Lines of Credit (HELOC) 90.0 91.0 Indirect Auto 25.2 25.7 Credit Cards 18.5 18.5 Other Personal 18.4 18.
Slide 28: Canadian Real Estate Secured Lending Portfolio
Canadian Real Estate Secured Lending Portfolio Quarterly Portfolio Volumes $B Highlights $280 $281 $283 $288 $292 Canadian RESL credit quality 65% 66% 67% 68% 69% remained strong Uninsured ▪ Uninsured and insured portfolio loan-to-value Insured rates stable 35% 34% 33% 32% 31% ▪ Less than 1% of unin
Slide 29: Canadian Personal Banking
Canadian Personal Banking Q4/19 Highlights Gross GIL GIL / ▪ Good asset quality in the Canadian Personal Banking Canadian Personal Banking Loans ($B) ($MM) Loans Residential Mortgages $200.0 $280 0.14% portfolio Home Equity Lines of Credit (HELOC) 91.0 147 0.16% Indirect Auto 25.7 82 0.32% Credit Ca
Slide 30: Canadian Commercial and Wholesale Banking
Canadian Commercial and Wholesale Banking Q4/19 Highlights Gross GIL GIL/ Canadian Commercial and Loans/BAs ▪ Canadian Commercial and Wholesale Banking ($MM) Loans ($B) Commercial Banking1 $80.6 376 0.47% Wholesale Banking GIL stable quarter-over-quarter Wholesale2 57.5 27 0.05% Total Canadian Comme
Slide 31: U.S. Personal Banking – U.S. Dollars
U.S. Personal Banking – U.S. Dollars Q4/19 Highlights Gross GIL GIL / U.S. Personal Banking1 ▪ Continued good asset quality in Loans ($B) ($MM) Loans Residential Mortgages $26.2 $337 1.29% U.S. Personal Home Equity Lines of Credit (HELOC)2 8.8 373 4.27% Indirect Auto 24.6 196 0.79% Credit Cards 13.8
Slide 32: U.S. Commercial Banking – U.S. Dollars
U.S. Commercial Banking – U.S. Dollars Q4/19 Highlights Gross GIL GIL/ U.S. Commercial Banking1 Loans / BAs ($MM) Loans ▪ Sustained good credit quality ($B) in U.S. Commercial Banking Commercial Real Estate (CRE) $24.2 $74 0.31% Non-residential Real Estate 17.6 55 0.31% Residential Real Estate 6.6 1
Slide 33: Investor Relations Contacts
Investor Relations Contacts Phone: 416-308-9030 or 1-866-486-4826 Email: tdir@td.com Website: www.td.com/investor
Slide 34: TD Bank Group Q4 2019 Quarterly Results Presentation
TD Bank Group Q4 2019 Quarterly Results Presentation Thursday, December 5, 2019