Toronto-dominion Bank · TSX:TD

Toronto-dominion Bank — TD Bank Group — Debt Investor Presentation (2017)

46 slides from Toronto-dominion Bank's debt investor presentation, 2017

  1. Slide 1: TD Bank Group Fixed Income Investor Presentation

    TD Bank Group Fixed Income Investor Presentation Q3 2017

  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: Contents

    Contents 1. TD Bank Group 2. Financial Highlights 3. Treasury & Balance Sheet Management 4. Appendix 3

  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 Q3 20171 Canadian U.S. U.S. Retail (C$) Retail

  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 Aa2 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 Q3 2017 Canadian American C$ except otherwise noted Ranking3 Ranking4 Total assets $1,202B 1st 5th Total deposits $774B 2nd 6th Market capitalization $118.8B 2nd 6th Reported net income (trailing four quarters) $10.1B 2nd 6th Adjusted net income1 (trailing four quarters) $1

  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. Retail top 10 bank4 in the U.S. with significant organic growth opportunities  Wholesale Banking North American dealer focused on cl

  9. Slide 9: Strategic Evolution of TD

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

  10. Slide 10: Connected Experiences

    Connected Experiences Digital Enhancements Consistent Strategy How we compete  Connected experiences enable seamless interactions between TD.com received an exciting new look with a Tablet enabled real time online account opening customers and the entire simple, responsive and modern design that's

  11. Slide 11: Corporate Responsibility Performance

    Corporate Responsibility Performance Highlights  TD joined 11 leading banks in a project led by the UN to pilot a set of recommendations released by the Financial Stability Board's Task Force  TD is the only Canadian bank listed on the Dow Jones on Climate Related Financial Disclosures Sustainabil

  12. Slide 12: Contents

    Contents 1. TD Bank Group 2. Financial Highlights 3. Treasury & Balance Sheet Management 4. Appendix 12

  13. Slide 13: Stable Earnings Growth

    Stable Earnings Growth Reported Earnings1,2 (C$MM) Wholesale Banking U.S. Retail Canadian Retail Targeting 7-10% adjusted EPS growth4 over the medium term 1. For the purpose of calculating contribution by each business segment, earnings from the Corporate segment are excluded. 2. Effective Q1 2014,

  14. Slide 14: Q3 2017 Highlights

    Q3 2017 Highlights Financial Highlights $MM Total Bank Reported Results (YoY) Reported Q3/17 Q2/17 Q3/16 Revenue 9,286 8,473 8,701 EPS up 18% PCL 505 500 556  Adjusted EPS up 19%1 Expenses 4,855 4,786 4,640 Revenue up 7% Net Income 2,769 2,503 2,358 Diluted EPS ($) 1.46 1.31 1.24  Net interest inc

  15. Slide 15: Gross Lending Portfolio

    Gross Lending Portfolio Includes B/As Balances (C$B unless otherwise noted) Q2/17 Q3/17 Canadian Retail Portfolio $ 377.5 $ 386.1 Personal $ 312.0 $ 318.7 Residential Mortgages 188.1 189.4 Home Equity Lines of Credit (HELOC) 68.0 72.3 Indirect Auto 20.9 21.6 Unsecured Lines of Credit 9.7 9.7 Credit

  16. Slide 16: Strong Credit Quality

    Strong Credit Quality GIL and PCL Ratios (bps) Gross Impaired Loans / Gross Loans and Acceptances (bps) Provision for Credit Losses / Average Net Loans and Acceptances (bps) Credit quality remains strong 16

  17. Slide 17: Canadian Personal Banking

    Canadian Personal Banking Q3/17 Highlights Gross GIL GIL / Canadian Personal Banking1  Continued strong credit Loans ($B) ($MM) Loans Residential Mortgages 189 297 0.16% quality in the Canadian Home Equity Lines of Credit (HELOC) 72 118 0.16% Personal portfolio Indirect Auto 22 44 0.20%  Reduction

  18. Slide 18: Canadian Real Estate Secured Lending Portfolio

    Canadian Real Estate Secured Lending Portfolio Quarterly Portfolio Volumes $B Highlights Canadian RESL credit quality remains strong  PCL rate remains stable at 1 bp  Uninsured and insured portfolio loan-to-value rates stable Condo credit quality consistent with broader portfolio Canadian RESL Por

  19. Slide 19: Contents

    Contents 1. TD Bank Group 2. Financial Highlights 3. Treasury & Balance Sheet Management 4. Appendix 19

  20. Slide 20: Bail-in Update

    Bail-in Update  The Budget Implementation Act, providing amendments to the CDIC Act, Bank Act and other statutes to allow for bail-in, was passed in June 2016.  The regime will provide the Canada Deposit Insurance Corporation (CDIC) with a new statutory power to convert specified eligible liabilit

  21. Slide 21: Capital & Liquidity

    Capital & Liquidity Common Equity Tier 11 Highlights  Common Equity Tier 1 ratio of 11% Q2 2017 CET1 Ratio 10.8%  Leverage ratio of 4.1% Internal capital generation 38 Impact of issuance of common shares 8  Liquidity coverage ratio of 124% Actuarial gains on employee pension plans 7  Tier 1 and

  22. Slide 22: TD Credit Ratings

    TD Credit Ratings Issuer Ratings1 Moody's S&P DBRS Ratings Aa2 AA- AA Outlook Negative Stable Stable Ratings vs. Peer Group S&P Long-Term Debt Rating Moody’s Long-Term Debt Rating 1. See footnote 2 on slide 5 for more information on credit ratings. 2. In the context of long-term debt ratings, Canadi

  23. Slide 23: Non-Common Equity Capital Ratings

    Non-Common Equity Capital Ratings  TD has industry leading ratings1 for both Additional Tier 1 and Tier 2 capital instruments Ratings vs. Peers NVCC Tier 2 Subordinated Debt Ratings Additional Tier 1 NVCC Preferred Share Ratings S&P Moody’s S&P Moody’s A A2 A A2 A- A3 A- A3 Baa1 BBB+ Baa1 BBB Baa2

  24. Slide 24: Robust Liquidity Management

    Robust Liquidity Management Liquidity Risk Management Framework High Quality Liquid Assets (HQLA)  Target a 90-day survival horizon under a combined  TD holds a variety of liquid assets Bank-specific and market-wide stress scenario, and a commensurate with liquidity needs in the minimum buffer ove

  25. Slide 25: Term Funding Strategy

    Term Funding Strategy Large base of stable retail and commercial deposits – primary source of funding  Customer service business model delivers stable base of “sticky” and franchise deposits  Reserve assets held for deposit balances based on LCR run-off requirements Wholesale term funding through

  26. Slide 26: Attractive Balance Sheet Composition

    Attractive Balance Sheet Composition1 Funding Mix2 Wholesale Term Debt6 Personal and commercial deposits are primary sources of funds 1. As of July 31, 2017. 2. Excludes certain liabilities which do not create funding which are: acceptances, trading derivatives, other liabilities, wholesale mortgage

  27. Slide 27: Wholesale Term Debt Composition

    Wholesale Term Debt Composition1 By Currency2,3 By Term2,3 EUR 18% 5 to < 7 Year $15B 60% $53B USD 45% GBP 5% $40B $5B 7+ Year 14% AUD 3% $12B $3B 3 to < 5 Year CAD 29% 17% $25B $15B < 3 Year 9% $8B 1. As of July 31, 2017. 2. Excludes certain private placement notes and mortgage securitization. 27 3

  28. Slide 28: Debt Maturity Profile F2017 – 2021

    Debt Maturity Profile1 F2017 – 2021 Bullet Debt Maturities (C$ billions)2 Manageable debt maturities 1. For wholesale term debt that has bullet maturities. 2. As of July 31, 2017. 28 3. Based on first par redemption date. The timing of an actual redemption is subject to management’s view at the time

  29. Slide 29: Key Takeaways

    Key Takeaways  Strong capital base  Industry leading credit ratings  Proactive & disciplined risk management  Attractive balance sheet composition  Diverse funding strategy 29

  30. Slide 30: Contents

    Contents 1. TD Bank Group 2. Economic Outlook 3. Treasury & Balance Sheet Management 4. Appendix • Economic Outlook • Credit Quality • Funding Instruments 30

  31. Slide 31: Economic Outlook

    Economic Outlook Global: As good as it gets  Global growth for 2017 is tracking slightly higher than our June estimate (3.5% versus 3.3% prior). A trend pace of roughly 3.5% is expected to hold through 2019.  The Federal Reserve may take first-steps on balance sheet normalization this fall. Demand

  32. Slide 32: Interest Rate Outlook

    Interest Rate Outlook Interest Rates, Canada and U.S.1  With the U.S. economy approaching full employment , we expect the Federal (%) Reserve to begin balance sheet normalization in the coming weeks, as well as hike rates once again late this year and twice more in 2018  The Bank of Canada is expe

  33. Slide 33: Contents

    Contents 1. TD Bank Group 2. Economic Outlook 3. Treasury & Balance Sheet Management 4. Appendix • Economic Outlook • Credit Quality • Funding Instruments 33

  34. Slide 34: Gross Impaired Loan Formations

    Gross Impaired Loan Formations By Portfolio GIL Formations1: $MM and Ratios2 Highlights  Gross Impaired Loan Formations decreased by $54MM in the quarter driven by:  $33MM lower formations in the Canadian RESL portfolio 21 21 21 19 18 bps Other3 Wholesale Portfolio Cdn Peers4 18 16 15 16 NA bps U.

  35. Slide 35: Gross Impaired Loans (GIL)

    Gross Impaired Loans (GIL) By Portfolio GIL1: $MM and Ratios2 Highlights  Gross Impaired Loans down $305MM quarter-over-quarter due to:  $197MM impact of foreign exchange  $74MM reduction in the Canadian RESL portfolio as resolutions outpaced formations 59 58 57 53 49 bps Other3 Wholesale Portfol

  36. Slide 36: Provision for Credit Losses (PCL)

    Provision for Credit Losses (PCL) By Portfolio PCL1: $MM and Ratios2 Highlights  PCL rate remains at a cyclically low level  Credit quality remains strong across all segments 1 39 37 42 35 33 bps Other3 Wholesale Portfolio4 Cdn Peers5 33 30 28 30 NA bps U.S. Retail Portfolio6 Canadian Retail Portf

  37. Slide 37: Canadian Commercial and Wholesale Banking

    Canadian Commercial and Wholesale Banking Canadian Commercial and Gross Q3/17 Highlights GIL GIL/ Loans/BAs Wholesale Banking ($B) ($MM) Loans  Canadian Commercial and Commercial Banking1 67 195 0.29% Wholesale Banking portfolios Wholesale 44 37 0.08% continue to perform well Total Canadian Commerc

  38. Slide 38: U.S. Personal Banking – U.S. Dollars

    U.S. Personal Banking – U.S. Dollars Q3/17 U.S. Personal Banking1 Gross Loans GIL GIL / Highlights ($B) ($MM) Loans Residential Mortgages 21 353 1.69%  Continued good asset quality Home Equity Lines of Credit (HELOC)2 10 656 6.80% in U.S. Personal Indirect Auto 22 181 0.82% Credit Cards 11 183 1.60

  39. Slide 39: U.S. Commercial Banking – U.S. Dollars

    U.S. Commercial Banking – U.S. Dollars Q3/17 Gross Loans / GIL GIL/ Highlights U.S. Commercial Banking1 BAs ($B) ($MM) Loans Commercial Real Estate (CRE) 22 81 0.37%  Sustained good credit Non-residential Real Estate 17 53 0.32% quality in U.S. Commercial Residential Real Estate 5 28 0.56% Banking

  40. Slide 40: Contents

    Contents 1. TD Bank Group 2. Economic Outlook 3. Treasury & Balance Sheet Management 4. Appendix • Economic Outlook • Credit Quality • Funding Instruments 40

  41. Slide 41: Canadian Covered Bond Legislation

    Canadian Covered Bond Legislation  The Covered Bond legal framework was announced in the 2012 Federal Budget through amendment to the National Housing Act and was passed into law in June 2012  Issuance must be in accordance with the legislation and issuers are prohibited from using insured mortgag

  42. Slide 42: CMHC Guide Highlights

    CMHC Guide Highlights Asset Coverage Test  To confirm overcollateralization of the covered bond collateral held against covered bonds outstanding  Quarterly indexation of property values provides adjustment for market developments Valuation Calculation  Test to monitor a covered bond program’s ex

  43. Slide 43: TD Legislative Covered Bonds

    TD Legislative Covered Bonds TD Covered Bond Programme Highlights Cover Pool as at July 31, 2017  TD has a C$40B legislative covered bond program  High quality, conventional first lien Canadian Residential  Covered bonds issuance for Canadian issuers governed mortgages originated by TD by CMHC-ad

  44. Slide 44: 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

  45. Slide 45: In Vancouver, Canada April 18 – 19, 2018

    Presenting the 27th European Covered Bond Council (ECBC) Plenary and Euromoney Covered Bond Conference In Vancouver, Canada April 18 – 19, 2018 Canada is the first non-European nation to host the ECBC Plenary. Please join us for this inaugural event. This event is kindly supported by the Canadian Co

  46. Slide 46: TD Bank Group Fixed Income Investor Presentation

    TD Bank Group Fixed Income Investor Presentation Q3 2017

TD Bank Group — Debt Investor Presentation (2017) on 6ix