Toronto-dominion Bank · TSX:TD

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

44 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 Q4 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), an

  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 Q4 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’s 2  Strong employment brand Retail Earnings Focus  Leader in customer service and convenience  Strong organic growt

  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$2.2 trillion  Nominal GDP of US$19.5 trillion  Population of 37 million  Population of 323 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 2017 Canadian American C$ except otherwise noted Ranking3 Ranking4 Total assets $1,279B 1st 5th Total deposits $833B 1st 5th Market capitalization $134.9B 2nd 6th Reported net income (trailing four quarters) $10.5B 2nd 6th Adjusted net income1 (trailing four quarters) $1

  8. Slide 8: Composition of Earnings

    Composition of Earnings Fiscal 2017 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 Canadian 26% the U.S. with significant Retail organic growth opportunities 60%  Wholesale

  9. Slide 9: Strategic Evolution of TD

    Strategic Evolution of TD Increasing Retail Focus Acquired Acquired Target credit TD card portf olio & Became primary Chry sler Completed strategic Acquired Waterhouse Acquired Commerce Acquired issuer of Aeroplan Completed Priv atized Financial Epoch; and credit card 51% of USA / Commerce Bank Riv

  10. Slide 10: Connected Experiences

    Connected Experiences Digital Enhancements Consistent Strategy How we compete  Connected experiences enable seamless interactions between TD.com receiv ed an exciting new look w ith a Tablet enabled real time online account opening customers and the entire simple, responsiv e and modern design that

  11. Slide 11: Corporate Responsibility Performance

    Corporate Responsibility Performance  TD joined 14 leading banks in a project led by the UN to pilot a set of Highlights recommendations released by the Financial Stability Board's Task Force on Climate Related Financial Disclosures  TD is the only Canadian bank listed on the Dow Jones  Green Bon

  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) $10,517 $8,936 Wholesale Banking $8,024 U.S. Retail $7,883 Canadian Retail $6,640 $6,460 2012 2013 2014 2015 2016 2017 Targeting 7-10% adjusted EPS growth4 over the medium term 1. For the purpose of calculating contribution by each business segment,

  14. Slide 14: Q4 2017 Highlights

    Q4 2017 Highlights Financial Highlights $MM Total Bank Reported Results (YoY) Reported Q4/17 Q3/17 Q4/16 Revenue 9,270 9,286 8,745 EPS up 18% PCL 578 505 548  Adjusted EPS up 11%1 Expenses 4,828 4,855 4,848 Net Income 2,712 2,769 2,303 Revenue up 6% Diluted EPS ($) 1.42 1.46 1.20  Net interest inc

  15. Slide 15: Gross Lending Portfolio

    Gross Lending Portfolio Includes B/As Balances (C$B unless otherwise noted) Q3/17 Q4/17 Canadian Retail Portfolio $ 386.1 $ 391.2 Personal $ 318.7 $ 323.1 Residential Mortgages 189.4 190.5 Home Equity Lines of Credit (HELOC) 72.3 75.0 Indirect Auto 21.6 22.3 Unsecured Lines of Credit 9.7 9.8 Credit

  16. Slide 16: Strong Credit Quality

    Strong Credit Quality GIL and PCL Ratios (bps) 81 83 78 66 63 61 60 58 58 56 50 49 49 43 50 39 41 38 37 39 34 34 31 37 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Q4/17 IFRS Gross Impaired Loans / Gross Loans and Acceptances (bps) Provision for Credit Losses / Average Net Loans and Accept

  17. Slide 17: Canadian Personal Banking

    Canadian Personal Banking Q4/17 Highlights Gross GIL GIL / Canadian Personal Banking 1 Loans ($B) Loans  Credit quality remains strong ($MM) Residential Mortgages 190 296 0.16% in the Canadian Personal Home Equity Lines of Credit (HELOC) 75 108 0.14% portfolio Indirect Auto 22 48 0.22% Credit Cards

  18. Slide 18: Canadian Real Estate Secured Lending Portfolio

    Canadian Real Estate Secured Lending Portfolio Quarterly Portfolio Volumes $B Highlights $261 $265 $254 $254 $256 Canadian RESL credit quality remains strong 50% 52% 53% 56% 58%  PCL rate remains stable at 1 bp Uninsured  Uninsured and insured portfolio loan-to-value Insured rates stable 50% 48% 4

  19. Slide 19: Contents

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

  20. Slide 20: Capital & Liquidity

    Capital & Liquidity Common Equity Tier 11 Highlights  Common Equity Tier 1 ratio of 10.7% Q3 2017 CET1 Ratio 11.0%  Leverage ratio of 3.9% Internal capital generation 32 Impact of repurchase of common shares (13)  Liquidity coverage ratio of 120% Impact of Scottrade transaction (23)  Tier 1 and

  21. Slide 21: 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 14- AA 18 Aa1 16 Aa2 12 A+ 14 Aa3 10 A 12 A1 8 A- 10 A2 8 A3 6 BBB+ 6 Baa1 BBB4 4 Baa2 2 3 2 2 2 3 TD Canadian Peers U.S

  22. Slide 22: 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 12 A- 12 A2 12 A- 12 A2 10 A- 10 A3 10 A- 10 A

  23. Slide 23: 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

  24. Slide 24: Attractive Balance Sheet Composition

    Attractive Balance Sheet Composition1 Large base of stable retail and commercial deposits Debt Maturity Profile 6 (C$B) Personal and commercial deposits primary sources of funds $28 $23  Customer service business model delivers stable $22 $20 base of “sticky” and franchise deposits Wholesale fundin

  25. Slide 25: Wholesale Term Debt Composition

    Wholesale Term Debt Composition1 Funding Strategy Wholesale term funding through diversified sources across domestic and international markets  Well-established C$40 billion Legislative Covered Bond Program is an important pillar in global funding strategy  Programmatic issuance for the establishe

  26. Slide 26: Bail-in Update

    Bail-in Update Regulation Status  Bail-in will come into force 180 days following publication of the final regulations which is expected in the coming months.  November 1, 2021. Under timelines proposed by OSFI, all Canadian domestic systemically important banks (D-SIBs) will have to comply with t

  27. Slide 27: Key Takeaways

    Key Takeaways  Strong capital base  Industry leading credit ratings  Proactive & disciplined risk management  Attractive balance sheet composition  Diverse funding strategy 27

  28. Slide 28: Contents

    Contents 1. TD Bank Group 2. Economic Outlook 3. Treasury & Balance Sheet Management 4. Appendix • Economic Outlook • Credit Quality • Funding Instruments 28

  29. Slide 29: Economic Outlook

    Economic Outlook Global: The Comeback Kid  Economic growth has come in better than expected globally, led by advanced economies  Persistent above-trend growth and tightening labor markets have yet to generate significant wage and price pressures in advanced economies, leading to a measured pace of

  30. Slide 30: Interest Rate Outlook

    Interest Rate Outlook Interest Rates, Canada and U.S.  The Fed is expected to raise rates (%) 7 25 bps in December, with another 25 Forecast US Federal bps lift expected every 6 months, Funds Rate 6 taking the Fed Funds Rate to 2.0% Bank of by the end of 2018 5 Canada Overnight  The Bank of Canada

  31. Slide 31: Contents

    Contents 1. TD Bank Group 2. Economic Outlook 3. Treasury & Balance Sheet Management 4. Appendix • Economic Outlook • Credit Quality • Funding Instruments 31

  32. Slide 32: Gross Impaired Loan Formations

    Gross Impaired Loan Formations By Portfolio GIL Formations1: $MM and Ratios2 Highlights $1,227 $1,281  Gross Impaired Loan Formations $1,154 $1,189 remain stable quarter-over- $1,100 quarter at 19bps  U.S. Retail formations quarterly $650 / 35 bps $579 / 31 bps increase of $68MM driven by: $620 /

  33. Slide 33: Gross Impaired Loans (GIL)

    Gross Impaired Loans (GIL) By Portfolio GIL1: $MM and Ratios2 Highlights  Gross Impaired Loans increased $3,509 $100MM quarter-over-quarter $3,399 $3,290 $163 / 41 bps $73 / 18 bps $3,085 driven by: $59 / 13 bps $2,985 $37 / 8 bps  An $84MM negative impact of $37 / 8 bps foreign exchange $2,352 /

  34. Slide 34: Provision for Credit Losses (PCL)

    Provision for Credit Losses (PCL) By Portfolio PCL1: $MM and Ratios2 Highlights $635 - $602  PCL increased $90MM quarter- $554 $1 / NM over-quarter driven by $518 $512 $1 / NM  US$75MM largely due to seasonal trends in the U.S. $392 / 84 bps Credit Card and Indirect Auto $292 / 63 bps $358 / 76 bp

  35. Slide 35: Canadian Commercial and Wholesale Banking

    Canadian Commercial and Wholesale Banking Q4/17 Gross Highlights Canadian Commercial and Loans/BAs GIL GIL/ Wholesale Banking ($B) ($MM) Loans  Canadian Commercial and Commercial Banking1 68 174 0.26% Wholesale Banking portfolios Wholesale 45 37 0.08% continue to perform well Total Canadian Com m e

  36. Slide 36: U.S. Personal Banking – U.S. Dollars

    U.S. Personal Banking – U.S. Dollars Q4/17 U.S. Personal Banking1 Gross Loans GIL GIL / Highlights ($B) ($MM) Loans Residential Mortgages 24 351 1.44%  Continued good asset quality Home Equity Lines of Credit (HELOC) 2 10 657 6.81% in U.S. Personal Indirect Auto 23 197 0.87%  US$48MM GIL increase

  37. Slide 37: U.S. Commercial Banking – U.S. Dollars

    U.S. Commercial Banking – U.S. Dollars Q4/17 Gross Loans / GIL GIL/ Highlights U.S. Commercial Banking1 BAs ($B) ($MM) Loans Com m ercial Real Estate (CRE) 22 91 0.40%  Sustained good credit Non-residential Real Estate 17 64 0.38% quality in U.S. Commercial Residential Real Estate 5 27 0.47% Bankin

  38. Slide 38: Contents

    Contents 1. TD Bank Group 2. Economic Outlook 3. Treasury & Balance Sheet Management 4. Appendix • Economic Outlook • Credit Quality • Funding Instruments 38

  39. Slide 39: 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

  40. Slide 40: 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

  41. Slide 41: TD Legislative Covered Bonds

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

  42. Slide 42: Investor Relations Contacts

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

  43. Slide 43: 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

  44. Slide 44: TD Bank Group Fixed Income Investor Presentation

    TD Bank Group Fixed Income Investor Presentation Q4 2017

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