Toronto-Dominion Bank · TSX:TD
Toronto-Dominion Bank — TD Bank Financial Group — Q4 2000 Earnings Presentation
25 slides from Toronto-Dominion Bank's earnings presentation, 2000
Slide 1: Bank Financial Group Fourth Quarter 2000
Bank Financial Group FOURTH QUARTER 2000 Bank Financial Group Dan Marinangeli EVP & CFO 1
Slide 2: Highlights
Highlights* Fourth Quarter: • EPS of $0.80 up 29% • Revenue up 45% • ROE 18.0% versus 14.9% last year • Canada Trust contribution $0.11 per share • TD Canada Trust net income up 71% • PCL $135MM versus $0MM last year Fiscal Year: • EPS of $3.16 up 32% • Market capitalization of $26.1 billion up 25%
Slide 3: Key Goals - How Did We Do?
Key Goals - How Did We Do? 2000 Goals Q4/00 2001 Goals Cash basis ROE 16 - 18 % 18.0% 17 - 20% PCL/Loans & BAs 30 bps 42 bps 35 bps (excluding special charges & reverse repos) Efficiency 58% 62.6% 58%* (excluding non-cash charges & one-time items) * Cash operating basis for TDCT after completion of
Slide 4: Revenue Growth and EPS Growth
Revenue Growth Base = Q4/99 160 * 150 140 130 120 TD excluding CT ** 4 Bank Cdn. Peer 110 *** U.S. Peers 100 90 Q4 99 Q1 00 Q2 00 Q3 00 Q4 00 * Total revenue (TEB) excluding special gains. ** Based on company reports. *** Universe includes largest 16 comparable banks and 3 brokerage comparables. Sou
Slide 5: Segment Performance: Operating Performance
SEGMENT PERFORMANCE Operating Performance Cash Net Revenue $ Millions Income $ Millions $1,427 $1,393 $251 $238 $1,356 $211 $147 $147 $870 $819 99 00 00 00 00 99 00 00 00 00 4/ 1/ 2/ 3/ 4/ 4/ 1/ 2/ 3/ 4/ Q Q Q Q Q Q Q Q Q Q Slide 10: TDCT 5
Slide 6: Net Interest Margin
Margin Net Interest Margin 3.89% 3.84% 3.93% 3.80% 3.67% Q4 99 Q1 00 Q2 00 Q3 00 Q4 00 Slide 11: TDCT SEGMENT PERFORMANCE 6
Slide 7: TD Waterhouse
TD Waterhouse Revenue Cash Net $ Millions Income $ Millions $688 $105 $548* $500 $519 $86* $368* $58 $53 $35* Q4/99 Q1/00 Q2/00 Q3/00 Q4/00 Q4/99 Q1/00 Q2/00 Q3/00 Q4/00 * Excludes special gains. Slide 13: TD Waterhouse TD Waterhouse Group, Inc. 1999 2000 Yr/Yr Oct 31 July 31 Oct 31 Change ($US) Act
Slide 8: TD Asset Management
SEGMENT PERFORMANCE TD Asset Management Revenue Cash Net $ Millions Income $ Millions $85 $86 $30 $30 $68 $57 $55 $20 $14 $13 Q4/99 Q1/00 Q2/00 Q3/00 Q4/00 Q4/99 Q1/00 Q2/00 Q3/00 Q4/00 Slide 16: TDAM 8
Slide 9: Assets Under Management and Mutual Funds
TD Asset Management Assets Under Management $ Billions 120 $112 $107 $102 100 $74 80 $69 $36 $39 $32 60 $24 $28 40 $21 $21 $22 $18 $19 20 $30 $29 $29 $17 $17 0 Q4/99 Q1/00 Q2/00 Q3/00 Q4/00 Other Assets Quantitative Capital: Institutional TD WAM Retail Funds TDAM Retail Canadian Mutual Funds Slide 1
Slide 10: TD Securities: Revenue
SEGMENT PERFORMANCE Securities TD Securities: Revenue $ Millions $788 $632 $650 $653 $595 Q4/99 Q1/00 Q2/00 Q3/00 Q4/00 Slide 20: TDSI 10
Slide 11: TD Securities Net Income and ROE; Risk Management
Securities TD Securities Cash Net ROE Income % $ Millions 27% $236 22% 22% $193 $195 20% 19% $179 $168 99 00 00 00 00 99 00 00 00 00 4/ 1/ 2/ 3/ 4/ 4/ 1/ 2/ 3/ 4/ Q Q Q Q Q Q Q Q Q Q Slide 21: TDSI FOURTH QUARTER 2000 RISK MANAGEMENT Bank Financial Group Tom Spencer EVP, Risk Management 11
Slide 12: Strong Asset Quality
Strong Asset Quality Ratio of PCL to Loans & BAs % 1.00 0.80 TD 4 Bank Peer 0.60 0.40 0.20 39 bps 0.00 1994 1995 1996 1997 1998 1999 2000 Notes: Excludes special general provisions and reverse repos. Q3/00 peer average used as proxy for full year. Slide 23: TDBFG Gross Impaired Loans $ Millions 1400
Slide 13: General Reserves & Net Impaired Loans; Telecom & Cable
General Reserves & Net Impaired Loans General Reserves General Reserves $ Millions as a % of RWA $862 $753 0.69 0.66 0.61 $636 0.39 $402 0.18 $159 1996 1997 1998 1999 2000 1996 1997 1998 1999 2000 Q3/00 4 Bank Peer Average: 0.79% Net Impaired Loans $(159)million Slide 25: TDBFG Telecom & Cable Loans
Slide 14: Market Risk: Distribution of Daily Net Trading Revenue
Market Risk Distribution of Daily Net Trading Revenue Q4 Fiscal 2000 Number of Days 25 20 15 10 5 0 0 - 2.5 10.0 (5.0) - (2.5)- 2.5 - 5.0 - 7.5 - 10.0 - 5.0 7.5 12.5 (2.5) 0 $ In millions • TD Securities’ average Value-at-Risk (VaR) for Q4/00 was CAD 24.8MM. • Daily trading losses never exceeded VaR
Slide 15: Integration Update: TD Canada Trust Momentum
TD Canada Trust Our Plan Maintain business momentum Integrate successfully Build a better bank Our vision: To be the best retail bank in North America Slide 29: TDCT Momentum Revenue $ Millions Top-line growth continues: $1,393 $1,427 • Revenue growth is $34 million or 2% higher than Q3/00 • Growth
Slide 16: Momentum: Cash Net Income
Momentum Cash Net Income $ Millions Strong earnings growth: $251 $238 • Cash net income of $251 million for the quarter • Up $13 million or 5% versus Q3/00 and $104 million higher than Q4/99 $147 Comparability of ROE: • Reported ROE of 16% impacted by merger-related financing and capital • Q4/00 ROE
Slide 17: Personal Loans, Cards and Deposits
Cards 7.6% Yr 7.6% Yrover overYr Yrgrowth growth $ Billions 1.4% Qtr 1.4% Qtrover overQtr Qtrgrowth growth $4 20% $3 15% $2 10% $1 5% Q4/98 Q2/99 Q4/99 Q2/00 Q4/00 Volume Cdn. Bank Mkt. Share to Sept/00 Note: Data restates TD and CT as a combined entity (excluding Master Card) and includes securitiz
Slide 18: Integrate Successfully
Integrate Successfully To date: FTE reductions ahead of schedule Expense reductions ahead of schedule Successful launch of TD Mutual Funds and Mutual Fund Customer Conversion weekend of October 6th Customer referrals to Evergreen and TD Waterhouse strong from CT Branches Systems • 6MM CT Customer pr
Slide 19: Building a Better Bank
Building a Better Bank We are building a Multi-channel, integrated financial services company With a clear and distinct brand Built on a distinguishable customer experience With a clear lead in e-Commerce Slide 37: TDCT Building a Better Bank Customer Focus: Customer Satisfaction Index 86.6 CT 86.8
Slide 20: Building a Better Bank: Multi-channel Banking
Excel in multi-channel distribution & e. Commerce Run rate for telephone and web banking Average weekly sign-ups 25,007 UP 23% 20,363 Jan-00* Q4/00 Since implementing sales revenue payment to branches for signing up customers, signup rates are climbing * Pro-forma including CT in January Slide 39: T
Slide 21: Maintain Business Momentum: Revenue
Building a Better Bank Revenue1 $ Millions $5,046 Top-line growth continues: • TD alone increased revenues $1,340 $500 million or 16% over 1999. $3,706 • Canada Trust added $1.3 billion $3,206 in revenues. $2,969 $3,129 • Revenue growth was 14% on a comparable basis. 1997 1998 1999 2000 1. Includes
Slide 22: Maintain Business Momentum: Efficiency
Building a Better Bank Operating1 efficiency $ Millions Efficiency improvement: 69% 69% 70% • TD Canada Trust efficiency ratio 64% improved to 64% this year from 70% in 1999. Achieved expense savings (on a comparable basis)2 • 3% expense increase versus14% revenue growth 1997 1998 1999 2000 1. Exclu
Slide 23: Maintain Business Momentum: Cash Net Income
Building a Better Bank Cash Net income $ Millions $847 Net income growth accelerates: • TD Canada Trust is $349 million or 70% higher than last year. $498 $466 $458 An impressive operating1 ROE • Annual ROE = 24% versus 20% for TD P&C last year 1997 1998 1999 2000 1.Excludes acquisition funding cost
Slide 24: Forward Looking Statements
Building a Better Bank Residential Mortgages & Personal Loans Personal Deposits including Credit Cards CM 24.0% CM 25.1% 19.3% RY 17.7% 23.8% RY 24.0% BMO BMO BNS 14.8% BNS 15.5% 17.4% 18.3% Source: OSFI Canada Gazette, August 2000. Canadian dollar balances Slide 47: TDCT Forward Looking Statements
Slide 25: Bank Financial Group Fourth Quarter 2000
FOURTH QUARTER 2000 Bank Financial Group 25
TD Bank Financial Group — Q4 2000 Earnings Presentation on 6ix