Slide 1: Q2 2023 Conference Call Presentation
Q2 2023 Conference Call Presentation June 7, 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 & CEO
4 David Taylor President & Chief Executive Officer
Slide 5: Q2 2023 highlights
5 Q2 2023 40% YoY growth in loan Realizing portfolio to record $3.42 B significant operating leverage inherent in Digital Banking model 58% YoY and 5% sequential growth in POS Loans & Leases Digital Banking efficiency ratio Record revenue at 43% Record net interest income Record net income1 ROCE at
Slide 6: Q2 2023 Key Metrics & Highlights: Record Results
6 Q2 2023 Key Metrics & Highlights: Record Results Consolidated Digital Banking: Strong loan portfolio growth to YoY Sequential another record: $3.42B Total Revenue 43% 3% Net Income 108% 9% Record quarterly revenue, net interest income, EPS 124% 12% net income and EPS1 Net Interest Margin 1 bp 5 bp
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: US Receivables Purchase Program: A New Financing Solution
US Receivables Purchase Program: A New Financing Solution 8 for the Underserved US Market Launched in US on a Limited Basis in April 2022 Supporting an Emerging, High-Growth Industry Full Roll Out to Commence Upon Closing of US Bank Acquisition With a massive millennial consumer base and an impressi
Slide 9: Shawn Clarke, Chief Financial Officer
9 Shawn Clarke Chief Financial Officer
Slide 10: Q2 2023: Continued Strong Financial Performance
10 Q2 2023: Continued Strong Financial Performance Balance Sheet • Total loan portfolio expanded to another record balance At April 30 2023 2022 YoY Sequential • Book Value per Share Change Change increased a function of higher Total Assets $3.73 B $2.69 B 39% 6% retained earnings (from net Loan Por
Slide 11: Q2 2023: Consolidated Income Statement
Q2 2023: Continued Strong Financial Performance 11 Consolidated Consolidated Income Statement • Revenue growth driven by higher net interest income from 3 Months Ended April 30 Digital Banking operations Sequential resulting from strong loan 2023 2022 YoY Change portfolio growth Change Revenue 26,68
Slide 12: Digital Banking Operations – Record Loan Portfolio: $3.42 B
Q2 2023: Continued Strong Financial Performance 12 Digital Banking Operations – Record Loan Portfolio: $3.42 B Q1 2023 Q2 2023 Total: $3.24 B Total: $3.42 B Point-of-Sale Loans/ Leases Point-of-Sale Loans/ Leases $2.4B Public Sector/ $2.5B Public Sector/ 75% Other Financing 74% Other Financing $43M
Slide 13: Digital Banking Operations Income Statement
Q2 2023: Continued Strong Financial Performance 13 Digital Banking Operations Digital Banking Operations: Income Statement • YoY increase in non-interest expense due mainly to higher 3 Months Ended April 30 salary and benefits costs related to increased staffing levels to support 2023 2022 YoY Chang
Slide 14: Cost of Funds
14 Cost of Funds Wealth Management (Personal Deposits) Q2 2023 cost of funds: 3.27% • Increased 189 bps (137%) vs Q2 2022 • Increased 32 bps (11%) vs Q1 2023 $2,525 $2,059 $1,108 $1,203 $1,150 $1,052 $1,041 $1,059 $1,213 $960 Increase in cost of funds 2014 2015 2016 2017 2018 2019 2020 2021 2022 Q2
Slide 15: PCL as a % of Average Loans
15 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% 0.03% 0.02% 0.03% (0.01%) (0.02%) (0.02%) (0.02%) 2014 2015 2016 2017 2018 2019 2020 2021 2022 Q2 2
Slide 16: Cybersecurity Services (DBG) Income Statement
Q2 2023: Continued Strong Financial Performance 16 DRTC Cybersecurity Services (DBG): Income Statement • Revenue increase for DBG 3 Months Ended YoY and sequentially a April 3o function of higher YoY Seq engagements in Q2/23 2023 2022 Change Change Revenue 2.6 2.4 5% 11% • YoY increase in gross prof
Slide 17: David Taylor, President & CEO
17 David Taylor President & Chief Executive Officer
Slide 18: Deposits: Unlimited Low-Cost, Partner-Based Sources
18 Deposits: Unlimited Low-Cost, Partner-Based Sources >220 Partners Provide Access to • Objective to minimize cost of deposit funding Millions of Depositors • All Wealth Management deposits are term deposits • Very “sticky” deposit base Insolvency Professionals (>100 Offices) Deposit Composition (Q
Slide 19: Near-Term Targets
Capitalizing on the Significant Operating Leverage 19 in Our Core Digital Banking Operations Near-Term Targets Period of Investment in Future Growth Loan Portfolio Size >$4B >$5B $3.42 62% 12.07% 9.30% $2.99 10.29% 8.68% 8.28% 8.20% 55% 50% 49% 52% Efficiency Ratio $1.59 <42% <35% $1.52 6.77% $2.10
Slide 20: Q&A Session
Q&A Session Toll Free Dial In (Canada/US): 1 (888) 664-6392 Local Dial In: (416) 764-8659
Slide 21: Our Time Has Arrived!
21 Our Time Has Arrived! Follow us