Toronto-dominion Bank · TSX:TD
Toronto-dominion Bank — TD Bank Group — Q1 2014 Earnings Presentation
34 slides from Toronto-dominion Bank's earnings presentation, February 2014
Slide 1: TD Bank Group Investor Presentation Q1 2014
TD Bank Group Investor Presentation Q1 2014
Slide 2: Caution regarding forward-looking statements
Caution regarding forward-looking statements From time to time, the Bank makes written and/or oral forward-looking statements, including in this document, in other filings with Canadian regulators or the U.S. Securities and Exchange Commission, and in other communications. In addition, representativ
Slide 3: TD Bank Group – Key Themes
TD Bank Group – Key Themes 5th largest bank 1 Top 10 Retail Focused North American Bank by Total Assets1 6th largest bank by Market Cap1 Delivering top tier long 2 Proven Performance term shareholder returns Highly rated 3 Strong Balance Sheet and Capital Position by major credit rating agencies Tar
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 Q1 20141 Canadian U.S. U.S. Retail (C$ except
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
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$1.7 trillion Nominal GDP of US$15.1 trillion Population of 35 million Population of 314 million Canadian Banking System U.S. Banking System Soundest banki
Slide 7: TD in North America
TD in North America North Q1 2014 Canadian American (C$ except otherwise noted) Ranking5 Ranking6 Total assets $909B 1st 5th Total deposits $562B 2nd 6th Market capitalization $89B 2nd 6th Adjusted net income1 (trailing four quarters) $7.3B 2nd 6th Reported net income (trailing four quarters) $6.9B
Slide 8: Composition of Earnings
Composition of Earnings Adjusted Earnings1 2013 Adjusted (C$MM) Retail Earnings1,4 = 91% Adjusted Retail Earnings1,4 Wholesale Earnings $7,136 9% Canadian Retail U.S Retail2 91% 65% 23% 4 TD AMTD3 $2,158 3% 42% Wholesale 9% 58% 2001 2013 Retail-focused earnings mix 1. See slide 4, footnote 3, for de
Slide 9: Strategic Evolution of TD
Strategic Evolution of TD INCREASING RETAIL FOCUS Acquired Acquired Target Became primary TD Chrysler credit card issuer of Waterhouse Financial portfolio & Epoch; Aeroplan Visa; TD Bank Acquired Acquired USA / Privatized Acquired Commerce Acquired and MBNA and announced acquired ~50% of and Canada
Slide 10: Risk Management Framework
Risk Management Framework Our Risk Appetite We take risks required to build our business, but only if those risks: Fit our business strategy and can be understood and managed Do not expose the enterprise to any significant single loss events; we don’t “bet the bank” on any single acquisition, bu
Slide 11: TD Bank Group – Key Themes
TD Bank Group – Key Themes 5th largest bank 1 Top 10 Retail Focused North American Bank by Total Assets1 6th largest bank by Market Cap1 Delivering top tier long 2 Proven Performance term shareholder returns Highly rated 3 Strong Balance Sheet and Capital Position by major credit rating agencies Tar
Slide 12: Stable Earnings Growth
Stable Earnings Growth Adjusted Earnings1,2,4 (C$MM) 2009 – 20112: Wholesale Banking Wealth & Insurance U.S. P&C Canadian P&C 2012 – 20134: Wholesale Banking U.S. Retail Canadian Retail IFRS Segment realignment Targeting 7-10% adjusted EPS growth over the medium term 1. The Bank transitioned from Ca
Slide 13: Solid Total Shareholder Returns
Solid Total Shareholder Returns Total Shareholder Return1 NA P Compounded Annual Growth Rates (CAGR) e r s 3 TD Canadian peers2 North American peers3 23.8% 20.5% 20.8% 20.0% 20.1% 12.7% 12.1% 11.5% 10.0% 10.1% 9.0% 4.5% 11Year Year 3 3Years Years 5 5Years Years 10Years 10 Years Delivering top tier l
Slide 14: Strong, Consistent Dividend History
Strong, Consistent Dividend History Dividends Per Share (C$) $1.62 Q1/14: Announced $0.04 dividend increase Dividend yield: 3.4%1 $0.19 Q3/12: Increased target payout range to 40%-50%2 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Dividend h
Slide 15: Q1 2014 Highlights
Q1 2014 Highlights Key Themes Net Income $MM Adjusted, where applicable1 Adjusted1 EPS growth of 6% YoY Q1/14 QoQ YoY Retail2 $ 1,832 5% 8% Retail earnings up 8% Wholesale 230 89% 44% Good volume and asset growth in Corporate (38) -32% n/a Canada and the U.S. Adjusted Net Income $ 2,024 12% 6%
Slide 16: Q1 2014 Segment Results Highlights
Q1 2014 Segment Results Highlights Adjusted1 net income up 5% YoY Aeroplan impact, good loan and deposit volume growth, and Canadian Continued solid wealth asset growth Retail Strong credit performance continues volume growth Adjusted1 expenses up 5% YoY Adjusted1 net income (ex-TD Ameritr
Slide 17: Q1 2014 Credit Highlights
Q1 2014 Credit Highlights Highlights PCL Ratio (bps)1 Continued stable credit performance Loss rates for Canadian P&C remain 39 40 37 38 historically low 35 Ongoing improvement in the U.S. Commercial portfolio Increase in GIL driven by weaker Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Canadian dollar GIL
Slide 18: TD Bank Group – Key Themes
TD Bank Group – Key Themes 5th largest bank by Total Assets1 1 Top 10 Retail Focused North American Bank 6th largest bank by Market Cap1 Delivering 2 Proven Performance top tier long term shareholder returns Highly rated 3 Strong Balance Sheet and Capital Position by major credit rating agencies Tar
Slide 19: Attractive Balance Sheet Composition
Attractive Balance Sheet Composition1 Funding Mix2 Wholesale Term Debt Assets Securitized 46% Personal Personal Other Deposits33 Other Deposits Term TermDeposits Deposits 25% 26% 8% Covered Bonds 8% Mortgage Residential Mortgages Short Term 15% Securitization 58% Liabilities4 Short Term Liabilities4
Slide 20: Gross Lending Portfolio
Gross Lending Portfolio Balances Highlights C$B (unless otherwise noted) Q1/14 Canadian Retail Portfolio $ 323.7 Personal $ 274.0 Canadian portfolio – strong credit quality Residential Mortgages 166.0 Home Equity Lines of Credit (HELOC) 60.3 Real estate secured lending volume up 4% YoY $226 bill
Slide 21: Strong Capital Position
Strong Capital Position Highlights Basel III Common Equity Tier 1 Ratio1 8.8% 8.8% 8.9% 9.0% 8.9% Basel III Common Equity Tier 1 ratio 8.9% as of January 31, 2014 Announced a dividend increase of $0.04 this quarter, up 9% Timing of future dividend increases may vary Q1/13 Q2/13 Q3/13 Q4/13 Q1/
Slide 22: Strong Focus on Risk-Adjusted Return
Strong Focus on Risk-Adjusted Return Accolades Q1 2014 Adjusted Return on Risk-Weighted Assets1 2.58% “Safest Bank in North America 2.30% & one of the World’s 50 Safest Banks” 1.61% – Global Finance magazine “One of the World’s Strongest Banks” – Bloomberg Markets magazine 2 4 TD Canadian Peers
Slide 23: TD Bank Group – Key Themes
TD Bank Group – Key Themes 5th largest bank 1 Top 10 Retail Focused North American Bank by Total Assets1 6th largest bank by Market Cap1 Delivering top tier long 2 Proven Performance term shareholder returns Highly rated 3 Strong Balance Sheet and Capital Position by major credit rating agencies Tar
Slide 24: Canadian Retail
Canadian Retail Consistent Strategy Adjusted Net Income1 (C$MM) Segment IFRS Realignment $4,567 $4,681 How we compete Committed to customer service and $3,095 $3,051 convenience across all channels $2,472 Focused on operational excellence Integrated product offerings $1,340 Reinvesting for t
Slide 25: Canadian Retail
Canadian Retail Personal & Commercial Banking #1 or #2 market share in most retail products1 On average 45% longer branch hours than peers2 with 425 branches offering Sunday banking Most downloaded mobile banking app in Canada #2 business bank in Canada in both credit and deposit market shar
Slide 26: U.S. Retail
U.S. Retail Consistent Strategy Adjusted Net Income1 ($MM) Segment IFRS Realignment How we compete $1,852 $1,619 Providing customers with legendary $1,270 service and convenience $1,042 $909 Bringing the whole Bank to our C$ customers $492 Conservative risk appetite Leveraging TD’s North Ame
Slide 27: U.S. Retail
U.S. Retail Personal & Commercial Banking Top 10 bank with 8MM+ customers, operating retail stores in 15 states and the District of Columbia Open longer than the competition, including Sunday banking in most markets Targeting top 5 market share in our major markets, including #3 deposit share
Slide 28: Wholesale Banking
Wholesale Banking Consistent Strategy Adjusted Net Income1 (C$MM) IFRS How we compete $1,137 $987 Canada $880 $815 Be the top-ranked integrated investment dealer $650 Fully aligned with TD Bank Group partners U.S. $230 Extend Canadian franchise’s goals into the U.S. Build U.S. franchise in p
Slide 29: Wholesale Banking
Wholesale Banking Focus on client-driven franchise businesses Diversified business mix with a North American focus Presence in key global financial centres Evolved the business model by strategically repositioning the dealer to concentrate on core-client driven activities (e.g., exited global
Slide 30: Corporate & Social Responsibility
Corporate & Social Responsibility Highlights Highest in Customer Satisfaction Among the Big Five TD Friends of the Environment Foundation celebrates 24 years Retail Banks in Canada by J.D. Power and Associates with over C$66 million in funds disbursed in support of more than 22,000 local environ
Slide 31: A Principled Approach
A Principled Approach Guiding Principles Leadership Profile ■ 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 ■ Understand Our Busines
Slide 32: 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 One of the World’s Most convenience Slowing loan Admired Companies1 growth in Canada ■ Leverage TD brand across all segments Low interest rate One of Canada’s m
Slide 33: Investor Relations Contacts
Investor Relations Contacts Phone: 416-308-9030 or 1-866-486-4826 Grand Prix for Best Overall Email: Investor Relations: Large Cap Best Investor Relations by [email protected] Sector: Financial Services Best Investor Relations by a CEO: Large Cap Website: Best Investor Relations by a CFO: Large Cap www.td
Slide 34: TD Bank Group Investor Presentation
TD Bank Group Investor Presentation Q1 2014