This quarterly
earnings news release should be read in conjunction with the Bank's
unaudited Third Quarter 2016 Report to Shareholders for the three
and nine months ended July 31, 2016, prepared in accordance with
International Financial Reporting Standards (IFRS) as issued by the
International Accounting Standards Board (IASB), which is available
on our website at http://www.td.com/investor/. This analysis is
dated August 24, 2016. Unless otherwise indicated, all amounts are
expressed in Canadian dollars, and have been primarily derived from
the Bank's Annual or Interim Consolidated Financial Statements
prepared in accordance with IFRS. Certain comparative amounts have
been reclassified to conform to the presentation adopted in the
current period. Additional information relating to the Bank is
available on the Bank's website at http://www.td.com, as well as on
SEDAR at http://www.sedar.com and on the U.S. Securities and
Exchange Commission's (SEC) website at http://www.sec.gov (EDGAR
filers section).
Reported results conform to generally accepted accounting
principles (GAAP), in accordance with IFRS. Adjusted measures are
non-GAAP measures. Refer to the "How the Bank Reports" section of
the Third Quarter 2016 Management's Discussion and Analysis
(MD&A) for an explanation of reported and adjusted
results.
|
THIRD QUARTER FINANCIAL HIGHLIGHTS, compared with the third
quarter a year ago:
- Reported diluted earnings per share were $1.24, compared with $1.19.
- Adjusted diluted earnings per share were $1.27, compared with $1.20.
- Reported net income was $2,358
million, compared with $2,266
million.
- Adjusted net income was $2,416
million, compared with $2,285
million.
YEAR-TO-DATE FINANCIAL HIGHLIGHTS, nine months ended
July 31, 2016, compared with the
corresponding period a year ago:
- Reported diluted earnings per share were $3.47, compared with $3.25.
- Adjusted diluted earnings per share were $3.64, compared with $3.47.
- Reported net income was $6,633
million, compared with $6,185
million.
- Adjusted net income was $6,945
million, compared with $6,577
million.
THIRD QUARTER ADJUSTMENT (ITEMS OF NOTE)
The third
quarter reported earnings figures included the following item of
note:
- Amortization of intangibles of $58
million after tax (3 cents per
share), compared with $62 million
after tax (3 cents per share) in
the third quarter a year ago.
TORONTO, Aug. 25, 2016 /CNW/ - TD Bank Group ("TD" or
the "Bank") today announced its financial results for the third
quarter ending July 31, 2016, reflecting growth in retail and
wholesale earnings.
"TD's results demonstrate the strength of our diversified
business model, with adjusted earnings of $2.4 billion, up 6%
from the third quarter last year," said Bharat Masrani, Group
President and Chief Executive Officer. "Our performance reflects
both organic growth and a focus on expense management."
Canadian Retail
Canadian Retail net income was $1.5 billion compared with
$1.6 billion in the same quarter last
year. Revenue grew 3% compared with the third quarter last year and
was more than offset by higher insurance claims largely due to the
Fort McMurray wildfire, and a
higher effective tax rate.
U.S. Retail
U.S. Retail net income was $788 million (US$609 million) this quarter compared
with $674 million (US$543
million) on a reported basis and $650 million
(US$524 million) on an adjusted basis in the third quarter
last year.
The U.S. Retail Bank, which excludes the Bank's investment in TD
Ameritrade, generated net income of $663
million (US$512 million), an increase of 14% (9% in
U.S. dollars) on a reported basis and 19% (14% in U.S. dollars) on
an adjusted basis compared with the third quarter last year.
Earnings reflect revenue and customer balance growth and a focus on
expense management.
TD Ameritrade contributed $125 million (US$97 million) in earnings to the segment, an
increase of 36% (31% in U.S. dollars) compared with the third
quarter last year reflecting asset growth, higher trading volumes,
and a favourable tax liability adjustment, partially offset by
higher operating expenses.
Wholesale Banking
Wholesale Banking net income was $302
million, an increase of 26% compared with the third quarter
last year, reflecting higher origination activity across debt and
equity capital markets, corporate lending growth and
trading-related revenue.
Capital
Common Equity Tier 1 Capital ratio on a Basel III fully phased-in
basis was 10.4%, compared with 10.1% last quarter.
Conclusion
"This quarter we were pleased to mark a milestone of 500,000
downloads of our TD MySpend money management app, which helps our
customers track their spending and saving," said Masrani. "We
remain focused on going above and beyond for our customers by
providing legendary service and convenience while investing for the
future to meet their evolving needs."
The foregoing contains forward-looking statements. Please refer
to the "Caution Regarding Forward-Looking Statements" on page
2.
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 in other
communications. In addition, representatives of the Bank may make
forward-looking statements orally to analysts, investors, the media
and others. All such statements are made pursuant to the "safe
harbour" provisions of, and are intended to be forward-looking
statements under, applicable Canadian and U.S. securities
legislation, including the U.S. Private Securities Litigation
Reform Act of 1995. Forward-looking statements include, but are
not limited to, statements made in this document, the Management's
Discussion and Analysis ("2015 MD&A") in the Bank's 2015 Annual
Report under the heading "Economic Summary and Outlook", for each
business segment under headings "Business Outlook and Focus for
2016", and in other statements regarding the Bank's objectives and
priorities for 2016 and beyond and strategies to achieve them, the
regulatory environment in which the Bank operates, and the Bank's
anticipated financial performance. Forward-looking statements are
typically identified by words such as "will", "should", "believe",
"expect", "anticipate", "intend", "estimate", "plan", "may", and
"could".
By their very nature, these forward-looking statements require the
Bank to make assumptions and are subject to inherent risks and
uncertainties, general and specific. Especially in light of the
uncertainty related to the physical, financial, economic,
political, and regulatory environments, such risks and
uncertainties – many of which are beyond the Bank's control and the
effects of which can be difficult to predict – may cause actual
results to differ materially from the expectations expressed in the
forward-looking statements. Risk factors that could cause,
individually or in the aggregate, such differences include: credit,
market (including equity, commodity, foreign exchange, and interest
rate), liquidity, operational (including technology and
infrastructure), reputational, insurance, strategic, regulatory,
legal, environmental, capital adequacy, and other risks. Examples
of such risk factors include the general business and economic
conditions in the regions in which the Bank operates; the ability
of the Bank to execute on key priorities, including the successful
completion of acquisitions, business retention, and strategic plans
and to attract, develop and retain key executives; disruptions in
or attacks (including cyber-attacks) on the Bank's information
technology, internet, network access or other voice or data
communications systems or services; the evolution of various types
of fraud or other criminal behaviour to which the Bank is exposed;
the failure of third parties to comply with their obligations to
the Bank or its affiliates, including relating to the care and
control of information; the impact of new and changes to, or
application of, current laws and regulations, including without
limitation tax laws, risk-based capital guidelines and liquidity
regulatory guidance; the overall difficult litigation environment,
including in the U.S.; increased competition, including through
internet and mobile banking and non-traditional competitors;
changes to the Bank's credit ratings; changes in currency and
interest rates (including the possibility of negative interest
rates); increased funding costs and market volatility due to market
illiquidity and competition for funding; critical accounting
estimates and changes to accounting standards, policies, and
methods used by the Bank; existing and potential international debt
crises; and the occurrence of natural and unnatural catastrophic
events and claims resulting from such events. The Bank cautions
that the preceding list is not exhaustive of all possible risk
factors and other factors could also adversely affect the Bank's
results. For more detailed information, please refer to the "Risk
Factors and Management" section of the 2015 MD&A, as may be
updated in subsequently filed quarterly reports to shareholders and
news releases (as applicable) related to any transactions or events
discussed under the heading "Significant Events" in the relevant
MD&A, which applicable releases may be found on www.td.com. All
such factors should be considered carefully, as well as other
uncertainties and potential events, and the inherent uncertainty of
forward-looking statements, when making decisions with respect to
the Bank and the Bank cautions readers not to place undue reliance
on the Bank's forward-looking statements.
Material economic assumptions underlying the forward-looking
statements contained in this document are set out in the 2015
MD&A under the headings "Economic Summary and Outlook", and for
each business segment, "Business Outlook and Focus for 2016", each
as may be updated in subsequently filed quarterly reports to
shareholders.
Any forward-looking statements contained in this document represent
the views of management only as of the date hereof and are
presented for the purpose of assisting the Bank's shareholders and
analysts in understanding the Bank's financial position, objectives
and priorities and anticipated financial performance as at and for
the periods ended on the dates presented, and may not be
appropriate for other purposes. The Bank does not undertake to
update any forward-looking statements, whether written or oral,
that may be made from time to time by or on its behalf, except as
required under applicable securities legislation.
|
This document was reviewed by the Bank's Audit
Committee and was approved by the Bank's Board of Directors,
on the Audit Committee's recommendation, prior to its
release.
|
TABLE 1: FINANCIAL
HIGHLIGHTS
|
(millions of Canadian
dollars, except as noted)
|
As at or for the
three months ended
|
|
As at or for the
nine months ended
|
|
|
|
July
31
|
|
April 30
|
|
July 31
|
|
July
31
|
|
July 31
|
|
|
|
2016
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
Results of
operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenue
|
$
|
8,701
|
|
$
|
8,259
|
|
$
|
8,006
|
|
$
|
25,570
|
|
$
|
23,379
|
|
Provision for credit
losses
|
|
556
|
|
|
584
|
|
|
437
|
|
|
1,782
|
|
|
1,174
|
|
Insurance claims and
related expenses
|
|
692
|
|
|
530
|
|
|
600
|
|
|
1,877
|
|
|
1,863
|
|
Non-interest expenses
|
|
4,640
|
|
|
4,736
|
|
|
4,292
|
|
|
14,029
|
|
|
13,162
|
|
Net income –
reported
|
|
2,358
|
|
|
2,052
|
|
|
2,266
|
|
|
6,633
|
|
|
6,185
|
|
Net income –
adjusted1
|
|
2,416
|
|
|
2,282
|
|
|
2,285
|
|
|
6,945
|
|
|
6,577
|
|
Return on common
equity – reported
|
|
14.1
|
%
|
|
12.5
|
%
|
|
14.9
|
%
|
|
13.3
|
%
|
|
14.2
|
%
|
Return on common
equity – adjusted2
|
|
14.5
|
|
|
14.0
|
|
|
15.0
|
|
|
14.0
|
|
|
15.1
|
|
Financial
position
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
$
|
1,182,436
|
|
$
|
1,124,786
|
|
$
|
1,099,202
|
|
$
|
1,182,436
|
|
$
|
1,099,202
|
|
Total
equity
|
|
71,204
|
|
|
67,823
|
|
|
65,965
|
|
|
71,204
|
|
|
65,965
|
|
Total Common Equity
Tier 1 Capital risk-weighted
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
assets3
|
|
388,243
|
|
|
383,589
|
|
|
369,495
|
|
|
388,243
|
|
|
369,495
|
|
Financial
ratios
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Efficiency ratio –
reported
|
|
53.3
|
%
|
|
57.3
|
%
|
|
53.6
|
%
|
|
54.9
|
%
|
|
56.3
|
%
|
Efficiency ratio –
adjusted1
|
|
52.6
|
|
|
54.8
|
|
|
53.4
|
|
|
53.6
|
|
|
54.0
|
|
Common Equity Tier 1
Capital ratio3
|
|
10.4
|
|
|
10.1
|
|
|
10.1
|
|
|
10.4
|
|
|
10.1
|
|
Tier 1 Capital
ratio3
|
|
11.9
|
|
|
11.7
|
|
|
11.5
|
|
|
11.9
|
|
|
11.5
|
|
Total Capital
ratio3
|
|
14.6
|
|
|
14.4
|
|
|
13.9
|
|
|
14.6
|
|
|
13.9
|
|
Leverage
ratio
|
|
3.8
|
|
|
3.8
|
|
|
3.7
|
|
|
3.8
|
|
|
3.7
|
|
Provision for credit
losses as a % of net average
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
loans and
acceptances4
|
|
0.39
|
|
|
0.42
|
|
|
0.33
|
|
|
0.42
|
|
|
0.31
|
|
Common share
information – reported (dollars)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Per share
earnings
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
$
|
1.24
|
|
$
|
1.07
|
|
$
|
1.20
|
|
$
|
3.48
|
|
$
|
3.26
|
|
|
Diluted
|
|
1.24
|
|
|
1.07
|
|
|
1.19
|
|
|
3.47
|
|
|
3.25
|
|
Dividends per
share
|
|
0.55
|
|
|
0.55
|
|
|
0.51
|
|
|
1.61
|
|
|
1.49
|
|
Book value per
share
|
|
35.68
|
|
|
33.89
|
|
|
33.25
|
|
|
35.68
|
|
|
33.25
|
|
Closing share price
|
|
56.89
|
|
|
55.85
|
|
|
52.77
|
|
|
56.89
|
|
|
52.77
|
|
Shares outstanding
(millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average
basic
|
|
1,853.4
|
|
|
1,850.9
|
|
|
1,851.1
|
|
|
1,852.8
|
|
|
1,847.9
|
|
|
Average
diluted
|
|
1,856.6
|
|
|
1,853.9
|
|
|
1,855.7
|
|
|
1,856.1
|
|
|
1,853.0
|
|
|
End of
period
|
|
1,854.8
|
|
|
1,853.5
|
|
|
1,853.6
|
|
|
1,854.8
|
|
|
1,853.6
|
|
Market capitalization
(billions of Canadian dollars)
|
$
|
105.5
|
|
$
|
103.5
|
|
$
|
97.8
|
|
$
|
105.5
|
|
$
|
97.8
|
|
Dividend yield
|
|
3.8
|
%
|
|
4.0
|
%
|
|
3.7
|
%
|
|
4.0
|
%
|
|
3.6
|
%
|
Dividend payout
ratio
|
|
44.5
|
|
|
51.2
|
|
|
42.7
|
|
|
46.3
|
|
|
45.7
|
|
Price-earnings
ratio
|
|
12.8
|
|
|
12.7
|
|
|
12.7
|
|
|
12.8
|
|
|
12.7
|
|
Common share
information – adjusted (dollars)1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Per share
earnings
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
$
|
1.27
|
|
$
|
1.20
|
|
$
|
1.21
|
|
$
|
3.65
|
|
$
|
3.47
|
|
|
Diluted
|
|
1.27
|
|
|
1.20
|
|
|
1.20
|
|
|
3.64
|
|
|
3.47
|
|
Dividend payout
ratio
|
|
43.4
|
%
|
|
45.9
|
%
|
|
42.3
|
%
|
|
44.1
|
%
|
|
42.9
|
%
|
Price-earnings
ratio
|
|
11.9
|
|
|
11.8
|
|
|
11.9
|
|
|
11.9
|
|
|
11.9
|
|
1
|
Adjusted measures are
non-GAAP measures. Refer to the "How the Bank Reports" section of
this document for an explanation of reported and adjusted
results.
|
2
|
Adjusted return on
common equity is a non-GAAP financial measure. Refer to the "Return
on Common Equity" section of this document for an
explanation.
|
3
|
Each capital ratio
has its own risk-weighted assets (RWA) measure due to the Office of
the Superintendent of Financial Institutions Canada (OSFI)
prescribed scalar for inclusion of the Credit Valuation Adjustment
(CVA). The scalars for inclusion of CVA for Common Equity Tier 1
(CET1), Tier 1, and Total Capital RWA are 64%, 71%, and 77%,
respectively.
|
4
|
Excludes acquired
credit-impaired (ACI) loans and debt securities classified as
loans. For additional information on ACI loans, refer to the
"Credit Portfolio Quality" section of the MD&A and Note 5 of
the Interim Consolidated Financial Statements. For additional
information on debt securities classified as loans, refer to the
"Exposure to Non-Agency Collateralized Mortgage Obligations"
discussion and tables in the "Credit Portfolio Quality" section of
the MD&A and Note 5 of the Interim Consolidated Financial
Statements.
|
HOW WE PERFORMED
How the Bank Reports
The Bank prepares its Interim
Consolidated Financial Statements in accordance with IFRS, the
current GAAP, and refers to results prepared in accordance with
IFRS as "reported" results. The Bank also utilizes non-GAAP
financial measures referred to as "adjusted" results to assess each
of its businesses and to measure the Bank's overall performance. To
arrive at adjusted results, the Bank removes "items of note", net
of income taxes, from reported results. The items of note relate to
items which management does not believe are indicative of
underlying business performance. The Bank believes that adjusted
results provide the reader with a better understanding of how
management views the Bank's performance. The items of note are
disclosed in Table 3. As explained, adjusted results differ from
reported results determined in accordance with IFRS. Adjusted
results, items of note, and related terms used in this document are
not defined terms under IFRS and, therefore, may not be comparable
to similar terms used by other issuers.
|
|
|
|
|
|
|
|
|
|
|
TABLE 2: OPERATING
RESULTS – Reported
|
|
|
|
|
|
|
|
|
|
|
(millions of Canadian
dollars)
|
For the three
months ended
|
|
For the nine
months ended
|
|
|
July
31
|
|
April 30
|
|
July 31
|
|
July
31
|
|
July 31
|
|
|
2016
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
Net interest
income
|
$
|
4,924
|
$
|
4,880
|
$
|
4,697
|
$
|
14,851
|
$
|
13,837
|
Non-interest
income
|
|
3,777
|
|
3,379
|
|
3,309
|
|
10,719
|
|
9,542
|
Total
revenue
|
|
8,701
|
|
8,259
|
|
8,006
|
|
25,570
|
|
23,379
|
Provision for credit
losses
|
|
556
|
|
584
|
|
437
|
|
1,782
|
|
1,174
|
Insurance claims and
related expenses
|
|
692
|
|
530
|
|
600
|
|
1,877
|
|
1,863
|
Non-interest expenses
|
|
4,640
|
|
4,736
|
|
4,292
|
|
14,029
|
|
13,162
|
Income before
income taxes and equity in net income
|
|
|
|
|
|
|
|
|
|
|
|
of an investment
in TD Ameritrade
|
|
2,813
|
|
2,409
|
|
2,677
|
|
7,882
|
|
7,180
|
Provision for income
taxes
|
|
576
|
|
466
|
|
502
|
|
1,588
|
|
1,264
|
Equity in net income
of an investment in TD Ameritrade
|
|
121
|
|
109
|
|
91
|
|
339
|
|
269
|
Net income –
reported
|
|
2,358
|
|
2,052
|
|
2,266
|
|
6,633
|
|
6,185
|
Preferred
dividends
|
|
36
|
|
37
|
|
25
|
|
98
|
|
73
|
Net income
available to common shareholders and
|
|
|
|
|
|
|
|
|
|
|
|
non-controlling
interests in subsidiaries
|
$
|
2,322
|
$
|
2,015
|
$
|
2,241
|
$
|
6,535
|
$
|
6,112
|
Attributable to:
|
|
|
|
|
|
|
|
|
|
|
Common
shareholders
|
$
|
2,293
|
$
|
1,987
|
$
|
2,213
|
$
|
6,449
|
$
|
6,029
|
Non-controlling
interests
|
|
29
|
|
28
|
|
28
|
|
86
|
|
83
|
The following table provides a reconciliation between the Bank's
adjusted and reported results.
|
|
|
|
|
TABLE 3: NON-GAAP
FINANCIAL MEASURES – Reconciliation of Adjusted to Reported Net
Income
|
|
|
|
|
(millions of Canadian
dollars)
|
For the three
months ended
|
For the nine
months ended
|
|
|
July
31
|
|
April 30
|
|
July 31
|
|
July
31
|
|
July 31
|
|
|
2016
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
Operating results
– adjusted
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
$
|
4,924
|
$
|
4,880
|
$
|
4,697
|
$
|
14,851
|
$
|
13,837
|
Non-interest
income1
|
|
3,777
|
|
3,437
|
|
3,288
|
|
10,731
|
|
9,504
|
Total
revenue
|
|
8,701
|
|
8,317
|
|
7,985
|
|
25,582
|
|
23,341
|
Provision for credit
losses
|
|
556
|
|
584
|
|
437
|
|
1,782
|
|
1,174
|
Insurance claims and
related expenses
|
|
692
|
|
530
|
|
600
|
|
1,877
|
|
1,863
|
Non-interest
expenses2
|
|
4,577
|
|
4,556
|
|
4,261
|
|
13,712
|
|
12,596
|
Income before income
taxes and equity in net income of an
|
|
|
|
|
|
|
|
|
|
|
|
investment in TD
Ameritrade
|
|
2,876
|
|
2,647
|
|
2,687
|
|
8,211
|
|
7,708
|
Provision for income
taxes3
|
|
597
|
|
491
|
|
508
|
|
1,654
|
|
1,445
|
Equity in net income
of an investment in TD Ameritrade4
|
|
137
|
|
126
|
|
106
|
|
388
|
|
314
|
Net income –
adjusted
|
|
2,416
|
|
2,282
|
|
2,285
|
|
6,945
|
|
6,577
|
Preferred
dividends
|
|
36
|
|
37
|
|
25
|
|
98
|
|
73
|
Net income
available to common shareholders and
|
|
|
|
|
|
|
|
|
|
|
|
non-controlling
interests in subsidiaries – adjusted
|
|
2,380
|
|
2,245
|
|
2,260
|
|
6,847
|
|
6,504
|
Attributable
to:
|
|
|
|
|
|
|
|
|
|
|
Non-controlling
interests in subsidiaries, net of income taxes
|
|
29
|
|
28
|
|
28
|
|
86
|
|
83
|
Net income
available to common shareholders – adjusted
|
|
2,351
|
|
2,217
|
|
2,232
|
|
6,761
|
|
6,421
|
Adjustments for
items of note, net of income taxes
|
|
|
|
|
|
|
|
|
|
|
Amortization of
intangibles5
|
|
(58)
|
|
(63)
|
|
(62)
|
|
(186)
|
|
(190)
|
Fair value of
derivatives hedging the reclassified
available-for-sale
|
|
|
|
|
|
|
|
|
|
|
|
securities
portfolio6
|
|
–
|
|
(51)
|
|
19
|
|
(10)
|
|
34
|
Impairment of
goodwill, non-financial assets, and other
charges7
|
|
–
|
|
(116)
|
|
–
|
|
(116)
|
|
–
|
Restructuring
charges8
|
|
–
|
|
–
|
|
–
|
|
–
|
|
(228)
|
Litigation and
litigation-related
charge(s)/reserve(s)9
|
|
–
|
|
–
|
|
24
|
|
–
|
|
(8)
|
Total adjustments
for items of note
|
|
(58)
|
|
(230)
|
|
(19)
|
|
(312)
|
|
(392)
|
Net income
available to common shareholders – reported
|
$
|
2,293
|
$
|
1,987
|
$
|
2,213
|
$
|
6,449
|
$
|
6,029
|
1
|
Adjusted non-interest
income excludes the following items of note: second quarter
2016 – $58 million loss due to change in fair value of
derivatives hedging the reclassified available-for-sale (AFS)
securities portfolio as explained in footnote 6; first quarter
2016 – $46 million gain due to change in fair value of
derivatives hedging the reclassified AFS securities portfolio;
third quarter 2015 – $21 million gain due to change in fair
value of derivatives hedging the reclassified AFS securities
portfolio; second quarter 2015 – $17 million gain due to
change in fair value of derivatives hedging the reclassified AFS
securities portfolio. These amounts were reported in the Corporate
segment.
|
2
|
Adjusted non-interest
expenses excludes the following items of note: third quarter
2016 – $63 million amortization of intangibles, as explained in
footnote 5; second quarter 2016 – $69 million
amortization of intangibles; $111 million impairment of goodwill,
certain intangibles, other non-financial assets, and other charges,
as further explained in footnote 7; first quarter 2016 –
$74 million amortization of intangibles; third quarter
2015 – $70 million amortization of intangibles; $39 million
recovery of litigation losses, as explained in footnote 9;
second quarter 2015 – $73 million amortization of
intangibles; $337 million due to the initiatives to reduce costs,
as explained in footnote 8; $52 million of litigation charges;
first quarter 2015 – $73 million amortization of
intangibles. These amounts were reported in the Corporate segment,
with the exception of litigation and litigation-related
charge(s)/reserve(s) which were reported in the U.S. Retail
segment.
|
3
|
For a reconciliation
between reported and adjusted provision for income taxes, refer to
the "Non-GAAP Financial Measures – Reconciliation of Reported to
Adjusted Provision for Income Taxes" table in the "Income Taxes"
section of the MD&A.
|
4
|
Adjusted equity in
net income of an investment in TD Ameritrade excludes the following
items of note: third quarter 2016 – $16 million amortization
of intangibles, as explained in footnote 5; second quarter
2016 – $17 million amortization of intangibles; first
quarter 2016 – $16 million amortization of intangibles;
third quarter 2015 – $15 million amortization of
intangibles; second quarter 2015 – $16 million amortization
of intangibles; first quarter 2015 – $14 million
amortization of intangibles. These amounts were reported in the
Corporate segment.
|
5
|
Amortization of
intangibles relate to intangibles acquired as a result of asset
acquisitions and business combinations. Although the amortization
of software and asset servicing rights are recorded in amortization
of intangibles, they are not included for purposes of the items of
note.
|
6
|
The Bank changed its
trading strategy with respect to certain trading debt securities
and reclassified these securities from trading to the AFS category
effective August 1, 2008. These debt securities are
economically hedged, primarily with credit default swap and
interest rate swap contracts which are recorded on a fair value
basis with changes in fair value recorded in the period's earnings.
Management believes that this asymmetry in the accounting treatment
between derivatives and the reclassified debt securities results in
volatility in earnings from period to period that is not indicative
of the economics of the underlying business performance in
Wholesale Banking. The Bank may from time to time replace
securities within the portfolio to best utilize the initial,
matched fixed term funding. As a result, the derivatives are
accounted for on an accrual basis in Wholesale Banking and the
gains and losses related to the derivatives in excess of the
accrued amounts are reported in the Corporate segment. Adjusted
results of the Bank exclude the gains and losses of the derivatives
in excess of the accrued amount.
|
7
|
In the second quarter
of 2016, the Bank recorded impairment losses on goodwill, certain
intangibles, other non-financial assets and deferred tax assets, as
well as other charges relating to the Direct Investing business in
Europe that has been experiencing continued losses. These amounts
are reported in the Corporate segment.
|
8
|
During 2015, the Bank
commenced its restructuring review and recorded restructuring
charges of $337 million ($228 million after tax) and $349 million
($243 million after tax) on a net basis, in the second quarter and
fourth quarter of 2015, respectively. The restructuring initiatives
were intended to reduce costs and manage expenses in a sustainable
manner and to achieve greater operational efficiencies. These
measures included process redesign and business restructuring,
retail branch and real estate optimization, and organizational
review. The restructuring charges have been recorded as an
adjustment to net income within the Corporate segment.
|
9
|
As a result of an
adverse judgment and evaluation of certain other developments and
exposures in the U.S. in 2015, the Bank took prudent steps to
reassess its litigation provision. Having considered these factors,
including related or analogous cases, the Bank determined, in
accordance with applicable accounting standards, that an increase
of $52 million ($32 million after tax) to the Bank's
litigation provision was required in the second quarter of 2015.
During the third quarter of 2015, distributions of $39 million ($24
million after tax) were received by the Bank as a result of
previous settlements reached on certain matters in the U.S.,
whereby the Bank was assigned the right to these distributions, if
and when made available. The amount in the third quarter of 2015
reflects this recovery of previous settlements.
|
|
|
|
|
|
TABLE 4:
RECONCILIATION OF REPORTED TO ADJUSTED EARNINGS PER SHARE
(EPS)1
|
(Canadian
dollars)
|
|
For the three
months ended
|
For the nine
months ended
|
|
|
July
31
|
|
April 30
|
|
July 31
|
|
July
31
|
|
July 31
|
|
|
2016
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
Basic earnings per
share – reported
|
$
|
1.24
|
$
|
1.07
|
$
|
1.20
|
$
|
3.48
|
$
|
3.26
|
Adjustments for items
of note2
|
|
0.03
|
|
0.13
|
|
0.01
|
|
0.17
|
|
0.21
|
Basic earnings per
share – adjusted
|
$
|
1.27
|
$
|
1.20
|
$
|
1.21
|
$
|
3.65
|
$
|
3.47
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings
per share – reported
|
$
|
1.24
|
$
|
1.07
|
$
|
1.19
|
$
|
3.47
|
$
|
3.25
|
Adjustments for items
of note2
|
|
0.03
|
|
0.13
|
|
0.01
|
|
0.17
|
|
0.22
|
Diluted earnings
per share – adjusted
|
$
|
1.27
|
$
|
1.20
|
$
|
1.20
|
$
|
3.64
|
$
|
3.47
|
1
|
EPS is computed by
dividing net income available to common shareholders by the
weighted-average number of shares outstanding during the
period.
|
2
|
For explanations of
items of note, refer to the "Non-GAAP Financial Measures –
Reconciliation of Adjusted to Reported Net Income" table in the
"How We Performed" section of this document.
|
|
|
TABLE 5: NON-GAAP
FINANCIAL MEASURES – Reconciliation of Reported to Adjusted
Provision for Income Taxes
|
|
(millions of Canadian
dollars, except as noted)
|
For the three
months ended
|
|
For the nine
months ended
|
|
|
|
July
31
|
|
|
April 30
|
|
|
July 31
|
|
|
July
31
|
|
|
July 31
|
|
|
|
2016
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
Provision for
income taxes – reported
|
$
|
576
|
|
$
|
466
|
|
$
|
502
|
|
$
|
1,588
|
|
$
|
1,264
|
|
Adjustments for
items of note: Recovery of
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(provision for)
income taxes1,2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of
intangibles
|
|
21
|
|
|
23
|
|
|
23
|
|
|
69
|
|
|
71
|
|
Fair value of
derivatives hedging the reclassified
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
available-for-sale
securities portfolio
|
|
–
|
|
|
7
|
|
|
(2)
|
|
|
2
|
|
|
(4)
|
|
Impairment of
goodwill, non-financial assets,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
and other
charges
|
|
–
|
|
|
(5)
|
|
|
–
|
|
|
(5)
|
|
|
–
|
|
Restructuring
charges
|
|
–
|
|
|
–
|
|
|
–
|
|
|
–
|
|
|
109
|
|
Litigation and
litigation-related charge(s)/reserve(s)
|
|
–
|
|
|
–
|
|
|
(15)
|
|
|
–
|
|
|
5
|
|
Total adjustments
for items of note
|
|
21
|
|
|
25
|
|
|
6
|
|
|
66
|
|
|
181
|
|
Provision for
income taxes – adjusted
|
$
|
597
|
|
$
|
491
|
|
$
|
508
|
|
$
|
1,654
|
|
$
|
1,445
|
|
Effective income
tax rate – adjusted3
|
|
20.8
|
%
|
|
18.5
|
%
|
|
18.9
|
%
|
|
20.1
|
%
|
|
18.7
|
%
|
1
|
For explanations of
items of note, refer to the "Non-GAAP Financial Measures –
Reconciliation of Adjusted to Reported Net Income" table in the
"How We Performed" section of this document.
|
2
|
The tax effect for
each item of note is calculated using the effective statutory
income tax rate of the applicable legal entity.
|
3
|
Adjusted effective
income tax rate is the adjusted provision for income taxes before
other taxes as a percentage of adjusted net income before
taxes.
|
Return on Common Equity
The Bank's methodology for
allocating capital to its business segments is aligned with the
common equity capital requirements under Basel III. The capital
allocated to the business segments is based on 9% CET1 Capital.
Adjusted return on common equity (ROE) is adjusted net income
available to common shareholders as a percentage of average common
equity.
Adjusted ROE is a non-GAAP financial measure as it is not a
defined term under IFRS. Readers are cautioned that earnings and
other measures adjusted to a basis other than IFRS do not have
standardized meanings under IFRS and, therefore, may not be
comparable to similar terms used by other issuers.
|
|
|
|
|
|
|
TABLE 6: RETURN ON
COMMON EQUITY
|
|
|
|
|
|
|
(millions of Canadian
dollars, except as noted)
|
|
For the three
months ended
|
|
For the nine
months ended
|
|
|
July
31
|
|
April 30
|
|
July 31
|
|
July
31
|
|
July 31
|
|
|
2016
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
Average common
equity
|
$
|
64,595
|
|
$
|
64,536
|
|
$
|
58,891
|
|
$
|
64,568
|
|
$
|
56,932
|
|
Net income
available to common shareholders
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
–
reported
|
|
2,293
|
|
|
1,987
|
|
|
2,213
|
|
|
6,449
|
|
|
6,029
|
|
Items of note, net of
income taxes1
|
|
58
|
|
|
230
|
|
|
19
|
|
|
312
|
|
|
392
|
|
Net income
available to common shareholders
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
–
adjusted
|
|
2,351
|
|
|
2,217
|
|
|
2,232
|
|
|
6,761
|
|
|
6,421
|
|
Return on common
equity – adjusted
|
|
14.5
|
%
|
|
14.0
|
%
|
|
15.0
|
%
|
|
14.0
|
%
|
|
15.1
|
%
|
1
|
For explanations of
items of note, refer to the "Non-GAAP Financial Measures –
Reconciliation of Adjusted to Reported Net Income" table in the
"How We Performed" section of this document.
|
HOW OUR BUSINESSES PERFORMED
For management reporting purposes, the Bank reports its results
under three key business segments: Canadian Retail, which includes
the results of the Canadian personal and commercial banking,
wealth, and insurance businesses; U.S. Retail, which includes the
results of the U.S. retail and commercial banking operations,
wealth management services, and the Bank's investment in TD
Ameritrade; and Wholesale Banking. The Bank's other activities are
grouped into the Corporate segment.
Results of each business segment reflect revenue, expenses,
assets, and liabilities generated by the businesses in that
segment. Where applicable, the Bank measures and evaluates the
performance of each segment based on adjusted results and ROE, and
for those segments the Bank indicates that the measure is adjusted.
For further details, refer to the "How the Bank Reports" section of
this document, the "Business Focus" section in the 2015 MD&A,
and Note 30 of the Bank's Consolidated Financial Statements for the
year ended October 31, 2015. For
information concerning the Bank's measure of ROE, which is a
non-GAAP financial measure, refer to the "How We Performed" section
of this document.
Effective the first quarter of 2016, the presentation of the
U.S. strategic cards portfolio revenues, provision for credit
losses (PCL), and expenses in the U.S. Retail segment includes
only the Bank's agreed portion of the U.S. strategic cards
portfolio, while the Corporate segment includes the retailer
program partners' share. Certain comparative amounts have been
recast to conform with this revised presentation. There was no
impact on the net income of the segments or on the presentation of
gross and net results in the Bank's Interim Consolidated Statement
of Income.
Net interest income within Wholesale Banking is calculated on a
taxable equivalent basis (TEB), which means that the value of
non-taxable or tax-exempt income, including dividends, is adjusted
to its equivalent before-tax value. Using TEB allows the Bank to
measure income from all securities and loans consistently and makes
for a more meaningful comparison of net interest income with
similar institutions. The TEB increase to net interest income and
provision for income taxes reflected in Wholesale Banking's results
are reversed in the Corporate segment. The TEB adjustment for the
quarter was $79 million, compared
with $91 million in the third quarter last year, and
$82 million in the prior quarter. The
TEB adjustment for the nine months ended July 31, 2016, was $226
million, compared with $322
million in the same period last year.
|
|
|
|
|
|
|
TABLE 7: CANADIAN
RETAIL
|
|
|
|
|
|
|
(millions of Canadian
dollars, except as noted)
|
For the three
months ended
|
|
For the nine
months ended
|
|
|
July
31
|
|
April 30
|
|
July 31
|
|
July
31
|
|
July 31
|
|
|
2016
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
Net interest
income
|
$
|
2,519
|
|
$
|
2,418
|
|
$
|
2,480
|
|
$
|
7,428
|
|
$
|
7,284
|
|
Non-interest
income
|
|
2,622
|
|
|
2,469
|
|
|
2,531
|
|
|
7,631
|
|
|
7,404
|
|
Total
revenue
|
|
5,141
|
|
|
4,887
|
|
|
5,011
|
|
|
15,059
|
|
|
14,688
|
|
Provision for credit
losses
|
|
258
|
|
|
262
|
|
|
237
|
|
|
748
|
|
|
666
|
|
Insurance claims and
related expenses
|
|
692
|
|
|
530
|
|
|
600
|
|
|
1,877
|
|
|
1,863
|
|
Non-interest
expenses
|
|
2,133
|
|
|
2,095
|
|
|
2,104
|
|
|
6,307
|
|
|
6,264
|
|
Net
income
|
$
|
1,509
|
|
$
|
1,464
|
|
$
|
1,557
|
|
$
|
4,486
|
|
$
|
4,442
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selected volumes
and ratios
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on common
equity
|
|
41.9
|
%
|
|
41.7
|
%
|
|
44.6
|
%
|
|
42.0
|
%
|
|
42.9
|
%
|
Margin on average
earning assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(including
securitized assets)
|
|
2.79
|
|
|
2.77
|
|
|
2.88
|
|
|
2.79
|
|
|
2.88
|
|
Efficiency
ratio
|
|
41.5
|
|
|
42.9
|
|
|
42.0
|
|
|
41.9
|
|
|
42.6
|
|
Assets under
administration
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(billions of Canadian
dollars)
|
$
|
337
|
|
$
|
321
|
|
$
|
314
|
|
$
|
337
|
|
$
|
314
|
|
Assets under
management
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(billions of Canadian
dollars)
|
|
265
|
|
|
254
|
|
|
249
|
|
|
265
|
|
|
249
|
|
Number of Canadian
retail branches
|
|
1,152
|
|
|
1,152
|
|
|
1,166
|
|
|
1,152
|
|
|
1,166
|
|
Average number of
full-time equivalent staff
|
|
38,852
|
|
|
37,987
|
|
|
39,180
|
|
|
38,383
|
|
|
39,365
|
|
Quarterly comparison – Q3 2016 vs. Q3 2015
Canadian Retail net income for the quarter was $1,509 million, a decrease of
$48 million, or 3%, compared with the third quarter last year.
Revenue growth was more than offset by higher insurance claims, a
higher effective tax rate, increased non-interest expenses and
higher PCL. The annualized ROE for the quarter was 41.9%, compared
with 44.6% in the third quarter last year.
Canadian Retail revenue is derived from the Canadian personal
and commercial banking, wealth, and insurance businesses. Revenue
for the quarter was $5,141 million,
an increase of $130 million, or 3%, compared with the third
quarter last year. Net interest income increased $39 million,
or 2%, reflecting loan and deposit volume growth, partially offset
by lower margins. Non-interest income increased $91 million,
or 4%, reflecting wealth asset-based fee growth, changes in the
fair value of investments supporting claims liabilities and higher
fee-based revenue in personal and commercial banking. Margin on
average earning assets was 2.79%, a 9 basis points (bps) decrease,
primarily reflecting competitive pricing in lending.
Average loan volumes increased $19
billion, or 5%, compared with the third quarter last year,
comprised of 4% growth in personal loan volumes and 10% growth in
business loan volumes. Average deposit volumes increased
$20 billion, or 8%, compared with the third quarter last year,
comprised of 7% growth in personal deposit volumes, 8% growth in
business deposit volumes and 15% growth in wealth deposit
volumes.
Assets under administration (AUA) were $337 billion as at
July 31, 2016, an increase of
$23 billion, or 7%, and assets under management (AUM) were
$265 billion as at July 31, 2016, an increase of
$16 billion, or 6%, compared with the third quarter last year,
both reflecting new asset growth and increases in market value.
PCL for the quarter was $258 million, an increase of
$21 million, or 9%, compared with the
third quarter last year. Personal banking PCL was
$248 million, an increase of $43 million, or 21%,
reflecting higher provisions in the auto lending portfolio in the
current quarter. Business banking PCL was $10 million, a decrease of $22 million. Annualized PCL as a percentage of
credit volume was 0.28%, or an increase of 1 basis point. Net
impaired loans were $732 million, an increase of
$26 million, or 4%. Net impaired loans as a percentage of
total loans were 0.20%, or flat compared with July
31, 2015.
Insurance claims and related expenses for the quarter were
$692 million, an increase of $92 million, or 15%,
compared with the third quarter last year. The increase reflects
the net impact of the Fort
McMurray wildfire as well as other weather-related claims,
and changes in the fair value of investments supporting claims
liabilities, partially offset by more favourable prior years'
claims development.
Non-interest expenses were $2,133 million, an increase of
$29 million, or 1%, compared with the third quarter last year.
The increase reflected business growth, higher employee-related
expenses including revenue-based variable expenses in the wealth
business and technology spend, partially offset by productivity
savings.
The efficiency ratio for the quarter was 41.5%, compared with
42.0% in the third quarter last year.
Quarterly comparison – Q3 2016 vs. Q2 2016
Canadian Retail net income increased $45 million, or 3%,
compared with the prior quarter, reflecting increased revenue,
partially offset by higher insurance claims and increased
non-interest expenses. The annualized ROE for the quarter was
41.9%, compared with 41.7% in the prior quarter.
Revenue increased $254 million, or
5%, compared with the prior quarter. Net interest income increased
$101 million, or 4%, reflecting loan
and deposit volume growth, additional days in the quarter, and
seasonal factors, partially offset by lower margins. Non-interest
income increased $153 million, or 6%, reflecting changes in
the fair value of investments supporting claims liabilities,
seasonality of insurance premiums, wealth asset-based fee growth,
higher fee-based revenue in personal and commercial banking, and
additional days in the quarter. Margin on average earning assets
was 2.79%, or a 2 bps increase, primarily reflecting higher
seasonal revenue, partially offset by lower lending margins.
Average loan volumes increased $5
billion, or 1%, compared with the prior quarter, comprised
of 1% growth in personal loan volumes and 2% growth in business
loan volumes. Average deposit volumes increased $10 billion, or 4%, comprised of 2% growth in
personal deposit volumes, 7% growth in business deposit volumes and
4% growth in wealth deposit volumes.
AUA were $337 billion as at July 31,
2016, an increase of $16
billion, or 5%, and AUM were $265 billion as at July
31, 2016, an increase of $11 billion, or 4%, compared
with the prior quarter-end, both reflecting increases in market
value and new asset growth.
PCL for the quarter decreased $4 million, or 2%, compared
with the prior quarter. Personal banking PCL for the quarter
decreased $4 million, or 2%, primarily reflecting lower
delinquencies in the current quarter. Business banking PCL was
flat. Annualized PCL as a percentage of credit volume was 0.28%, or
a 2 bps decrease. Net impaired loans decreased $25 million, or
3%. Net impaired loans as a percentage of total loans were 0.20%,
compared with 0.21% as at April 30, 2016.
Insurance claims and related expenses for the quarter increased
$162 million, or 31%, compared with
the prior quarter. The increase reflects the net impact of the
Fort McMurray wildfire as well as
other weather-related claims, seasonal increases in claims and
changes in the fair value of investments supporting claims
liabilities, partially offset by more favourable prior years'
claims development.
Non-interest expenses increased $38 million, or 2%,
reflecting business growth, additional days in the quarter and
higher technology spend.
The efficiency ratio for the quarter was 41.5%, compared with
42.9% in the prior quarter.
Year-to-date comparison – Q3 2016 vs. Q3 2015
Canadian Retail net income for the nine months ended July 31, 2016, was $4,486
million, an increase of $44
million, or 1%, compared with the same period last year. The
increase in earnings reflects revenue growth, partially offset by
the impact of a higher effective tax rate, higher PCL and increased
non-interest expenses. The annualized ROE for the period was 42.0%,
compared with 42.9% in the same period last year.
Revenue was $15,059 million, an
increase of $371 million, or 3%, compared with the same period
last year. Net interest income increased $144 million, or 2%,
reflecting loan and deposit volume growth, partially offset by
lower margins. Non-interest income increased $227 million, or
3%, reflecting wealth asset-based fee growth, higher fee-based
revenue in personal and commercial banking, a change in mix of
reinsurance contracts, and higher insurance premiums, partially
offset by changes in the fair value of investments supporting
claims liabilities. Margin on average earning assets was 2.79%, a 9
bps decrease, reflecting lower margins and competitive pricing.
Average loan volumes increased $19
billion, or 6%, compared with the same period last year,
comprised of 5% growth in personal loan volumes and 10% growth in
business loan volumes. Average deposit volumes increased
$16 billion, or 6%, comprised of 6%
growth in personal deposit volumes, 5% growth in business deposit
volumes and 13% growth in wealth deposit volumes.
PCL was $748 million, an increase of $82 million, or
12%, compared with the same period last year. Personal banking PCL
was $725 million, an increase of $98 million, or 16%,
reflecting higher provisions in the auto lending portfolio.
Business banking PCL was $23 million,
a decrease of $16 million. Annualized PCL as a percentage of
credit volume was 0.28%, an increase of 2 bps, compared with the
same period last year.
Insurance claims and related expenses were $1,877 million, an increase of
$14 million, or 1%, compared with the same period last
year.
Non-interest expenses were $6,307 million, an increase of
$43 million, or 1%, compared with the same period last year.
The increase reflects higher employee-related expenses including
revenue-based variable expenses in the wealth business, business
growth and technology spend, partially offset by productivity
savings.
The efficiency ratio was 41.9%, compared with 42.6% in the same
period last year.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TABLE 8: U.S.
RETAIL1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of dollars,
except as noted)
|
|
|
|
|
|
|
|
|
|
For the three
months ended
|
|
|
|
Canadian
dollars
|
|
|
|
|
|
|
U.S.
dollars
|
|
|
July
31
|
|
April 30
|
|
July 31
|
|
July
31
|
|
April 30
|
|
July 31
|
|
|
|
2016
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2016
|
|
|
2015
|
|
Net interest
income
|
$
|
1,755
|
|
$
|
1,737
|
|
$
|
1,527
|
|
$
|
1,354
|
|
$
|
1,308
|
|
$
|
1,224
|
|
Non-interest
income
|
|
591
|
|
|
553
|
|
|
576
|
|
|
456
|
|
|
417
|
|
|
463
|
|
Total
revenue
|
|
2,346
|
|
|
2,290
|
|
|
2,103
|
|
|
1,810
|
|
|
1,725
|
|
|
1,687
|
|
Provision for credit
losses
|
|
168
|
|
|
162
|
|
|
153
|
|
|
130
|
|
|
123
|
|
|
122
|
|
Non-interest expenses
– reported
|
|
1,372
|
|
|
1,416
|
|
|
1,239
|
|
|
1,058
|
|
|
1,067
|
|
|
994
|
|
Non-interest expenses
– adjusted
|
|
1,372
|
|
|
1,416
|
|
|
1,278
|
|
|
1,058
|
|
|
1,067
|
|
|
1,024
|
|
U.S. Retail Bank
net income – reported2
|
|
663
|
|
|
611
|
|
|
582
|
|
|
512
|
|
|
459
|
|
|
469
|
|
Adjustments for
items of note, net of
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
income
taxes3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Litigation and
litigation-related
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
charge(s)/reserve(s)
|
|
–
|
|
|
–
|
|
|
(24)
|
|
|
–
|
|
|
–
|
|
|
(19)
|
|
U.S. Retail Bank
net income – adjusted2
|
|
663
|
|
|
611
|
|
|
558
|
|
|
512
|
|
|
459
|
|
|
450
|
|
Equity in net income
of an investment in
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TD
Ameritrade
|
|
125
|
|
|
108
|
|
|
92
|
|
|
97
|
|
|
78
|
|
|
74
|
|
Net income –
adjusted
|
|
788
|
|
|
719
|
|
|
650
|
|
|
609
|
|
|
537
|
|
|
524
|
|
Net income –
reported
|
$
|
788
|
|
$
|
719
|
|
$
|
674
|
|
$
|
609
|
|
$
|
537
|
|
$
|
543
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selected volumes
and ratios
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on common
equity – reported
|
|
9.5
|
%
|
|
8.7
|
%
|
|
8.6
|
%
|
|
9.5
|
%
|
|
8.7
|
%
|
|
8.6
|
%
|
Return on common
equity – adjusted
|
|
9.5
|
|
|
8.7
|
|
|
8.3
|
|
|
9.5
|
|
|
8.7
|
|
|
8.3
|
|
Margin on average
earning assets4
|
|
3.14
|
|
|
3.11
|
|
|
3.05
|
|
|
3.14
|
|
|
3.11
|
|
|
3.05
|
|
Efficiency ratio –
reported
|
|
58.5
|
|
|
61.8
|
|
|
58.9
|
|
|
58.5
|
|
|
61.8
|
|
|
58.9
|
|
Efficiency ratio –
adjusted
|
|
58.5
|
|
|
61.8
|
|
|
60.8
|
|
|
58.5
|
|
|
61.8
|
|
|
60.8
|
|
Assets under
administration
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(billions of
dollars)
|
$
|
16
|
|
$
|
15
|
|
$
|
15
|
|
$
|
13
|
|
$
|
12
|
|
$
|
11
|
|
Assets under
management
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(billions of
dollars)
|
|
93
|
|
|
90
|
|
|
97
|
|
|
71
|
|
|
72
|
|
|
74
|
|
Number of U.S. retail
stores
|
|
1,267
|
|
|
1,265
|
|
|
1,305
|
|
|
1,267
|
|
|
1,265
|
|
|
1,305
|
|
Average number of
full-time equivalent
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
staff
|
|
25,998
|
|
|
25,599
|
|
|
25,546
|
|
|
25,998
|
|
|
25,599
|
|
|
25,546
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the nine
months ended
|
|
|
|
|
|
|
|
|
|
Canadian
dollars
|
|
|
|
U.S.
dollars
|
|
|
|
|
|
|
|
|
July
31
|
|
July 31
|
|
July
31
|
|
July 31
|
|
|
|
|
|
|
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
Net interest
income
|
$
|
5,261
|
|
$
|
4,473
|
|
$
|
3,950
|
|
$
|
3,665
|
|
Non-interest
income
|
|
1,774
|
|
|
1,606
|
|
|
1,332
|
|
|
1,316
|
|
Total
revenue
|
|
7,035
|
|
|
6,079
|
|
|
5,282
|
|
|
4,981
|
|
Provision for credit
losses
|
|
551
|
|
|
361
|
|
|
413
|
|
|
297
|
|
Non-interest expenses
– reported
|
|
4,194
|
|
|
3,746
|
|
|
3,147
|
|
|
3,069
|
|
Non-interest expenses
– adjusted
|
|
4,194
|
|
|
3,733
|
|
|
3,147
|
|
|
3,057
|
|
U.S. Retail Bank
net income – reported2
|
|
1,916
|
|
|
1,626
|
|
|
1,441
|
|
|
1,333
|
|
Adjustments for
items of note, net of income taxes3
|
|
|
|
|
|
|
|
|
|
|
|
|
Litigation and
litigation-related charge(s)/reserve(s)
|
|
–
|
|
|
8
|
|
|
–
|
|
|
7
|
|
U.S. Retail Bank
net income – adjusted2
|
|
1,916
|
|
|
1,634
|
|
|
1,441
|
|
|
1,340
|
|
Equity in net income
of an investment in TD Ameritrade
|
|
342
|
|
|
267
|
|
|
257
|
|
|
222
|
|
Net income –
adjusted
|
|
2,258
|
|
|
1,901
|
|
|
1,698
|
|
|
1,562
|
|
Net income –
reported
|
$
|
2,258
|
|
$
|
1,893
|
|
$
|
1,698
|
|
$
|
1,555
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selected volumes
and ratios
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on common
equity – reported
|
|
9.0
|
%
|
|
8.3
|
%
|
|
9.0
|
%
|
|
8.3
|
%
|
Return on common
equity – adjusted
|
|
9.0
|
|
|
8.4
|
|
|
9.0
|
|
|
8.4
|
|
Margin on average
earning assets4
|
|
3.12
|
|
|
3.13
|
|
|
3.12
|
|
|
3.13
|
|
Efficiency ratio –
reported
|
|
59.6
|
|
|
61.6
|
|
|
59.6
|
|
|
61.6
|
|
Efficiency ratio –
adjusted
|
|
59.6
|
|
|
61.4
|
|
|
59.6
|
|
|
61.4
|
|
Assets under
administration (billions of dollars)
|
$
|
16
|
|
$
|
15
|
|
$
|
13
|
|
$
|
11
|
|
Assets under
management (billions of dollars)
|
|
93
|
|
|
97
|
|
|
71
|
|
|
74
|
|
Number of U.S. retail
stores
|
|
1,267
|
|
|
1,305
|
|
|
1,267
|
|
|
1,305
|
|
Average number of
full-time equivalent staff
|
|
25,608
|
|
|
25,781
|
|
|
25,608
|
|
|
25,781
|
|
1
|
Certain comparative
amounts and ratios have been recast to conform with the revised
presentation, which includes only the Bank's agreed portion of
revenue, PCL, and expenses for the U.S. strategic cards portfolio
and was adopted in the first quarter of 2016. For further details,
refer to the "How our Businesses Performed" section of this
document.
|
2
|
Before the equity in
net income of the Bank's investment in TD Ameritrade.
|
3
|
For explanations of
items of note, refer to the "Non-GAAP Financial Measures −
Reconciliation of Adjusted to Reported Net Income" table in the
"How We Performed" section of this document.
|
4
|
The margin on average
earning assets excludes the impact related to the TD Ameritrade
insured deposit accounts (IDA) and the impact of intercompany
deposits and cash collateral. In addition, the value of tax-exempt
interest income is adjusted to its equivalent before-tax
value.
|
Quarterly comparison – Q3 2016 vs. Q3 2015
U.S. Retail net income for the quarter was $788 million (US$609
million), which included net income of $663 million (US$512 million) from the U.S.
Retail Bank and $125 million
(US$97 million) from the Bank's
investment in TD Ameritrade. U.S. Retail reported earnings
increased US$66 million, or 12%,
compared with the third quarter last year, while adjusted earnings
were up US$85 million, or 16%. In
addition to U.S. dollar earnings growth, U.S. Retail Canadian
dollar earnings benefited from the strength of the U.S. dollar with
reported earnings up $114 million, or
17%, and adjusted earnings up $138
million, or 21%. The reported and adjusted annualized ROE
for the quarter was 9.5%, compared with 8.6% and 8.3%,
respectively, in the third quarter last year.
U.S. Retail Bank reported net income for the quarter increased
US$43 million, or 9%, compared with
the third quarter last year, due to higher loan and deposit
volumes, positive operating leverage, and good credit quality,
partially offset by recovery of litigation losses in the same
period last year. U.S. Retail Bank adjusted net income
increased US$62 million, or
14%. The contribution from TD Ameritrade of
US$97 million was up US$23 million, or 31%, reflecting asset growth,
higher trading volumes and a favourable tax liability adjustment,
partially offset by higher operating expenses.
U.S. Retail Bank revenue is derived from retail and commercial
banking operations, wealth management services, and investments.
Revenue for the quarter was US$1,810
million, an increase of US$123
million, or 7%, compared with the third quarter last year.
Net interest income increased US$130
million, or 11%, reflecting loan and deposit growth, higher
margins, and the benefit of an acquisition in the strategic cards
portfolio. Margin on average earning assets was 3.14%, a 9 bps
increase, due to the December 2015
Fed rate increase (the "Rate Increase"), positive hedging impact,
and favourable balance sheet mix, partially offset by lower loan
margins. Non‑interest income decreased US$7
million, or 2%, reflecting fee income growth in personal
banking and wealth management, and the benefit of an acquisition in
the strategic cards portfolio, offset by unfavourable hedging
impact and lower overdraft fees attributable to a change in time
order posting of customer transactions.
Excluding an acquisition in the strategic cards portfolio,
average loan volumes increased US$13 billion, or 11%, compared
with the third quarter last year due to growth in business and
personal loans of 17% and 4%, respectively. Average deposit volumes
increased US$19 billion, or 9%, reflecting 7% growth in
business deposit volumes, 9% growth in personal deposit volumes and
11% increase in sweep deposit volume from TD Ameritrade.
AUA were US$13 billion as at
July 31, 2016, an increase of 11%,
compared with the third quarter last year, primarily due to
increases in private banking balances. AUM were US$71 billion as at July
31, 2016, a decrease of 4%, primarily due to declines in
international equity
markets.
PCL for the quarter was US$130
million, an increase of US$8
million, or 7%, compared with the third quarter last year.
Personal banking PCL was US$80 million, an increase of
US$4 million, or 4%, primarily related to auto lending and
credit card loans. Business banking PCL was US$49 million, a US$4 million increase, or
9%, primarily due to portfolio growth. PCL associated with debt
securities classified as loans was US$1 million, flat compared
with the third quarter last year. Net impaired loans, excluding ACI
loans and debt securities classified as loans, were US$1.5 billion, an increase of US$101 million, or 7%. The increase was related
to certain legacy performing home equity loans that were classified
as impaired due to concerns about the borrowers' ability to
continue to pay under modified terms. As the borrowers demonstrate
an ability to perform under the modified terms, the loans are
returned to performing status. Net impaired loans, excluding ACI
loans and debt securities classified as loans, as a percentage of
total loans were 1.1% as at July 31,
2016. Net impaired debt securities classified as loans were
US$672 million, a decrease of
US$140 million, or 17%.
Non-interest expenses for the quarter were US$1,058 million. Reported non-interest expenses
increased US$64 million, or 6%,
compared with the third quarter last year, reflecting higher
employee costs, business initiatives, and recovery of litigation
losses in the same period last year, partially offset by
productivity savings. Adjusted non-interest expenses increased
US$34 million, or 3%.
The reported and adjusted efficiency ratios for the quarter were
58.5%, compared with 58.9% and 60.8%, respectively, in the third
quarter last year.
Quarterly comparison – Q3 2016 vs. Q2 2016
U.S. Retail earnings increased US$72
million, or 13%, compared with the prior quarter. U.S.
Retail Canadian dollar earnings were up $69 million, or 10%.
The annualized ROE for the quarter was 9.5%, compared to 8.7% in
the prior quarter.
U.S. Retail Bank net income for the quarter increased
US$53 million, or 12%, compared with
the prior quarter, due to higher loan volumes, fee income growth,
and two additional days in the quarter. The contribution from TD
Ameritrade increased US$19 million,
or 24%, primarily due to higher asset-based revenue, a favourable
tax liability adjustment and lower operating expenses, partially
offset by decreased transaction-based revenue.
Revenue for the quarter increased US$85
million, or 5%, compared with the prior quarter. Net
interest income increased US$46 million, or 4%, reflecting
higher loan volumes and two additional days in the quarter. Margin
on average earning assets was 3.14%, a 3 bps increase, due to
positive hedging impact and higher deposit margins. Non‑interest
income increased US$39 million, or
9%, primarily reflecting organic and seasonal growth in personal
banking fee revenue.
Average loan volumes increased US$4
billion, or 3%, compared with the prior quarter, due to
growth in the commercial and auto lending portfolios. Average
deposit volumes were flat compared with the prior quarter.
AUA and AUM were US$13 billion and
US$71 billion, respectively, as at
July 31, 2016, both relatively flat
compared with the prior quarter.
PCL for the quarter increased US$7
million, or 6%, compared with the prior quarter. Personal
banking PCL was US$80 million, down
US$6 million, reflecting the
favourable housing environment. Business banking PCL was
US$49 million, an increase of
US$13 million, primarily due to
portfolio growth. PCL associated with debt securities classified as
loans was US$1 million, flat compared with the prior quarter.
Net impaired loans, excluding ACI loans and debt securities
classified as loans, were US$1.5
billion, a decrease of US$155
million, or 10%. The decrease was mainly related to certain
legacy home equity loans returning to performing status after
demonstrating a sustained ability to pay under modified terms. Net
impaired loans, excluding ACI loans and debt securities classified
as loans, as a percentage of total loans decreased 14 bps compared
to the prior quarter. Net impaired debt securities classified as
loans decreased US$59 million, or 8%.
Non-interest expenses for the quarter were relatively flat
compared with the prior quarter.
The efficiency ratio for the quarter was 58.5%, compared with
61.8% in the prior quarter.
Year-to-date comparison – Q3 2016 vs. Q3 2015
U.S. Retail net income for the nine months ended July 31, 2016, was $2,258
million (US$1,698 million),
which included net income of $1,916 million (US$1,441 million) from the U.S. Retail Bank
and $342 million (US$257
million) from the Bank's investment in TD Ameritrade. U.S.
Retail reported earnings increased US$143
million, or 9%, compared with the same period last year,
while adjusted earnings were up US$136 million, or 9%. In
addition to U.S. dollar earnings growth, Canadian dollar earnings
benefited from the strength of the U.S. dollar, with reported
earnings up $365 million, or 19%, and
adjusted earnings up $357 million, or
19%. The reported and adjusted annualized ROE for the nine months
ended July 31, 2016, was 9.0%,
compared with 8.3% and 8.4%, respectively.
U.S. Retail Bank net income on a reported basis increased
US$108 million, or 8%, compared with
the same period last year, due to higher loan and deposit volumes,
positive operating leverage, and contribution from an acquisition
in the strategic cards portfolio, partially offset by higher PCL.
U.S. Retail Bank adjusted net income increased US$101 million, or 8%. The contribution from TD
Ameritrade of US$257 million
increased US$35 million, or 16%,
primarily due to increased asset-based revenue and a favourable tax
liability adjustment, partially offset by higher operating
expenses.
Revenue was US$5,282 million, an
increase of US$301 million, or 6%,
compared with the same period last year. Net interest income
increased US$285 million, or 8%,
reflecting loan and deposit volume growth, and the benefit of an
acquisition in the strategic cards portfolio, partially offset by
lower margins. Margin on average earning assets was 3.12%, a 1
basis point decrease, due to lower loan margins as a result of the
competitive environment, partially offset by the Rate Increase and
positive hedging impact. Non‑interest income increased US$16 million, or 1%, primarily reflecting
customer account growth, higher transaction volumes, and the
benefit of an acquisition in the strategic cards portfolio, offset
by unfavourable hedging impact.
Excluding an acquisition in the strategic cards portfolio,
average loan volumes increased US$13 billion, or 11%, compared
with the same period last year due to growth in business loans and
personal loans of 18% and 4%, respectively. Average deposit volumes
increased US$18 billion, or 9%, reflecting 8% growth in
business deposits, 8% growth in personal deposits, and 11% growth
in sweep deposit volume from TD Ameritrade.
PCL was US$413 million, an
increase of US$116 million, or 39%,
compared with the same period last year. Personal banking PCL was
US$285 million, an increase of
US$39 million, or 16%, primarily due
to higher provision for auto loans and credit cards, partially
offset by improvements on residential mortgages. Business banking
PCL was US$125 million, an increase
of US$67 million, primarily due to
commercial loan volume growth and an allowance increase reflecting
the current business economic environment. PCL associated with debt
securities classified as loans was US$3
million, an increase of US$10 million. Annualized PCL
as a percentage of credit volume for loans excluding debt
securities classified as loans was 0.39%, an increase of
6 bps.
Non-interest expenses for the nine months ended July 31, 2016, were US$3,147 million. Reported non-interest expenses
for the period increased US$78 million, or 3%, compared with
the same period last year, primarily due to business initiatives,
employee costs, and volume growth, partially offset by productivity
savings. Adjusted non-interest expenses increased US$90 million, or 3%.
The reported and adjusted efficiency ratio for the period was
59.6%, compared with 61.6% and 61.4%, respectively, for the same
period last year.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TABLE 9: WHOLESALE
BANKING
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of Canadian
dollars, except as noted)
|
|
For the three
months ended
|
|
|
For the nine
months ended
|
|
|
July
31
|
|
April 30
|
|
July 31
|
|
July
31
|
|
July 31
|
|
|
2016
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
Net interest income
(TEB)
|
$
|
390
|
|
$
|
440
|
|
$
|
564
|
|
$
|
1,289
|
|
$
|
1,745
|
|
Non-interest
income
|
|
469
|
|
|
326
|
|
|
201
|
|
|
1,000
|
|
|
515
|
|
Total
revenue
|
|
859
|
|
|
766
|
|
|
765
|
|
|
2,289
|
|
|
2,260
|
|
Provision for credit
losses
|
|
11
|
|
|
50
|
|
|
2
|
|
|
73
|
|
|
4
|
|
Non-interest
expenses
|
|
437
|
|
|
441
|
|
|
431
|
|
|
1,307
|
|
|
1,311
|
|
Net
income
|
$
|
302
|
|
$
|
219
|
|
$
|
239
|
|
$
|
682
|
|
$
|
677
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selected volumes
and ratios
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trading-related
revenue
|
$
|
447
|
|
$
|
429
|
|
$
|
425
|
|
$
|
1,256
|
|
$
|
1,229
|
|
Gross drawn (billions
of dollars)1
|
|
21
|
|
|
19
|
|
|
16
|
|
|
21
|
|
|
16
|
|
Return on common
equity
|
|
20.4
|
%
|
|
14.8
|
%
|
|
17.2
|
%
|
|
15.2
|
%
|
|
15.9
|
%
|
Efficiency
ratio
|
|
50.9
|
|
|
57.6
|
|
|
56.3
|
|
|
57.1
|
|
|
58.0
|
|
Average number of
full-time equivalent staff
|
|
3,808
|
|
|
3,649
|
|
|
3,736
|
|
|
3,724
|
|
|
3,751
|
|
1
|
Includes gross loans
and bankers' acceptances, excluding letters of credit and before
any cash collateral, credit default swaps, and reserves for the
corporate lending business.
|
Quarterly comparison – Q3 2016 vs. Q3 2015
Wholesale Banking net income for the quarter was $302 million, an increase of $63 million, or 26%, compared with the third
quarter last year reflecting higher revenue, partially offset by
higher PCL and higher non-interest expenses. The annualized ROE for
the quarter was 20.4%, compared with 17.2% in the third quarter
last year.
Wholesale Banking revenue is derived primarily from capital
markets services and corporate lending. The capital markets
businesses generate revenue from advisory, underwriting, trading,
facilitation, and trade execution services. Revenue for the quarter
was $859 million, an increase of
$94 million, or 12%, compared with
the third quarter last year reflecting higher origination activity
from debt and equity capital markets, higher corporate lending fees
and higher trading-related revenue.
PCL increased $9 million compared
with the third quarter last year reflecting specific provisions in
the oil and gas sector.
Non-interest expenses were $437
million, an increase of $6
million, or 1%, compared with the third quarter last year,
reflecting higher variable compensation and the unfavourable impact
of foreign exchange translation, partially offset by lower
operating expenses.
Quarterly comparison – Q3 2016 vs. Q2 2016
Wholesale Banking net income for the quarter increased $83 million, or 38%, compared with the prior
quarter reflecting higher revenue, lower PCL and lower non-interest
expenses, partially offset by a higher effective tax rate. The
annualized ROE for the quarter was 20.4%, compared with 14.8% in
the prior quarter.
Revenue for the quarter increased $93
million, or 12%, compared with the prior quarter reflecting
higher origination activity from debt and equity capital markets,
higher corporate lending fees and higher trading-related
revenue.
PCL for the quarter was $11
million, a decrease of $39
million, reflecting lower specific provisions in the oil and
gas sector.
Non-interest expenses for the quarter decreased $4 million, or 1%, compared with the prior
quarter.
Year-to-date comparison – Q3 2016 vs. Q3 2015
Wholesale Banking net income for the nine months ended July 31, 2016, was $682
million, an increase of $5
million, compared with the same period last year reflecting
higher revenue, lower non-interest expenses and a lower effective
tax rate, partially offset by higher PCL. The annualized ROE was
15.2%, compared with 15.9% in the same period last year.
Revenue was $2,289 million, an
increase of $29 million, or 1%,
compared with the same period last year.
PCL was $73 million, an increase
of $69 million compared with the same
period last year, reflecting specific provisions in the oil and gas
sector.
Non-interest expenses were $1,307
million, a decrease of $4
million, compared with the same period last year.
|
|
|
|
|
|
|
|
|
|
|
TABLE 10:
CORPORATE
|
|
|
|
|
|
|
|
|
|
|
(millions of Canadian
dollars)
|
For the three
months ended
|
|
For the nine
months ended
|
|
|
July
31
|
April 30
|
July 31
|
July
31
|
July 31
|
|
|
2016
|
2016
|
2015
|
2016
|
2015
|
Net income (loss)
– reported
|
$
|
(241)
|
$
|
(350)
|
$
|
(204)
|
$
|
(793)
|
$
|
(827)
|
Adjustments for
items of note, net of income taxes1
|
|
|
|
|
|
|
|
|
|
|
Amortization of
intangibles
|
|
58
|
|
63
|
|
62
|
|
186
|
|
190
|
Fair value of
derivatives hedging the reclassified
|
|
|
|
|
|
|
|
|
|
|
|
available-for-sale
securities portfolio
|
|
–
|
|
51
|
|
(19)
|
|
10
|
|
(34)
|
Impairment of
goodwill, non-financial assets, and
|
|
|
|
|
|
|
|
|
|
|
|
other
charges
|
|
–
|
|
116
|
|
–
|
|
116
|
|
–
|
Restructuring
charges
|
|
–
|
|
–
|
|
–
|
|
–
|
|
228
|
Net income (loss)
– adjusted
|
$
|
(183)
|
$
|
(120)
|
$
|
(161)
|
$
|
(481)
|
$
|
(443)
|
|
|
|
|
|
|
|
|
|
|
|
|
Decomposition of
items included in net income
|
|
|
|
|
|
|
|
|
|
|
|
(loss) –
adjusted
|
|
|
|
|
|
|
|
|
|
|
Net corporate
expenses
|
$
|
(222)
|
$
|
(196)
|
$
|
(193)
|
$
|
(621)
|
$
|
(542)
|
Other
|
|
10
|
|
48
|
|
4
|
|
54
|
|
16
|
Non-controlling
interests
|
|
29
|
|
28
|
|
28
|
|
86
|
|
83
|
Net income (loss)
– adjusted
|
$
|
(183)
|
$
|
(120)
|
$
|
(161)
|
$
|
(481)
|
$
|
(443)
|
1
|
For explanations of
items of note, refer to the "Non-GAAP Financial Measures –
Reconciliation of Adjusted to Reported Net Income" table in the
"How We Performed" section of this document.
|
Quarterly comparison – Q3 2016 vs. Q3 2015
Corporate segment's reported net loss for the quarter was
$241 million, compared with a
reported net loss of $204 million in
the third quarter last year. Reported net loss included gains
related to the fair value of derivatives hedging the reclassified
available-for-sale securities portfolio in the third quarter last
year. Adjusted net loss was $183
million, compared with an adjusted net loss of $161 million in the third quarter last year.
Adjusted net loss increased primarily due to higher net corporate
expenses, partially offset by higher contribution from Other Items.
Net corporate expenses increased due to ongoing investments in
enterprise and regulatory projects. Other items included higher
revenue from treasury and balance sheet management activities and
higher provisions for incurred but not identified credit losses due
to credit deterioration in exposures within the oil and gas
industry, and volume growth within the Canadian Retail and
Wholesale Banking loan portfolios.
Quarterly comparison – Q3 2016 vs. Q2 2016
Corporate segment's reported net loss for the quarter was
$241 million, compared with a
reported net loss of $350 million in
the prior quarter. Reported net loss in the second quarter included
impairment of goodwill, non-financial assets, and other charges,
and losses related to the fair value of derivatives hedging the
reclassified available-for-sale securities portfolio. Adjusted net
loss was $183 million, compared with
an adjusted net loss of $120 million
in the prior quarter. Adjusted net loss increased primarily due to
higher net corporate expenses and lower contribution from Other
Items. Lower contribution from Other Items included higher tax
provisions this quarter and lower revenue from treasury and balance
sheet management activities, partially offset by lower provisions
for incurred but not identified credit losses.
Year-to-date comparison – Q3 2016 vs. Q3 2015
Corporate segment's reported net loss for the nine months ended
July 31, 2016, was $793 million, compared with a reported net loss
of $827 million in the same period
last year. Reported net loss included impairment of goodwill,
non-financial assets, and other charges, and losses related to the
fair value of derivatives hedging the reclassified
available-for-sale securities portfolio in the current period, and
restructuring charges, partially offset by gains related to the
fair value of derivatives hedging the reclassified
available-for-sale securities portfolio in the same period last
year. Adjusted net loss for the nine months ended July 31, 2016, was $481
million, compared with an adjusted net loss of $443 million in the same period last year. The
increase in adjusted net loss was due to higher net corporate
expenses, partially offset by higher contribution from Other Items.
Net corporate expenses increased due to ongoing investments in
enterprise and regulatory projects. Higher contribution from Other
Items was primarily due to higher revenue from treasury and balance
sheet management activities and lower tax provisions in the current
period, partially offset by higher provisions for incurred but not
identified credit losses due to an increase in portfolio risk,
credit deterioration in exposures impacted by low oil and gas
prices, and volume growth within the Canadian Retail and Wholesale
Banking loan portfolios.
SHAREHOLDER AND INVESTOR INFORMATION
Shareholder Services
If
you:
|
And your inquiry
relates to:
|
Please
contact:
|
Are a registered
shareholder (your name
appears on your TD share certificate)
|
Missing dividends,
lost share certificates, estate
questions, address changes to the share register,
dividend bank account changes, the dividend
reinvestment plan, eliminating duplicate mailings of
shareholder materials or stopping (and resuming)
receiving annual and quarterly reports
|
Transfer
Agent:
CST Trust Company
P.O. Box 700, Station B
Montréal, Québec H3B
3K3
1-800-387-0825
(Canada and U.S. only)
or
416-682-3860
Facsimile:
1-888-249-6189
inquiries@canstockta.com or
www.canstockta.com
|
Hold your TD shares
through the
Direct
Registration System
in the United
States
|
Missing dividends,
lost share certificates, estate
questions, address changes to the share
register, eliminating duplicate
mailings of shareholder
materials or stopping (and resuming) receiving
annual and quarterly reports
|
Co-Transfer Agent
and Registrar
Computershare
P.O. Box 30170
College Station, TX
77842-3170, or
Computershare
211 Quality Circle,
Suite 210
College Station, TX
77845
1-866-233-4836
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impaired: 1-800-231-5469
Shareholders outside
of U.S.: 201-680-6578
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outside of U.S.: 201-680-6610
www.computershare.com
|
Beneficially
own TD shares that are held in
the name of an intermediary, such as a bank,
a trust company, a securities broker or other
nominee
|
Your TD shares,
including questions regarding the
dividend reinvestment plan and mailings of
shareholder materials
|
Your
intermediary
|
For all other shareholder inquiries, please contact TD
Shareholder Relations at 416-944-6367 or 1-866-756-8936 or email
tdshinfo@td.com.
Please note that by leaving us an e-mail or voicemail message, you
are providing your consent for us to forward your inquiry to the
appropriate party for response.
Access to Quarterly Results Materials
Interested investors, the media and others may view this third
quarter earnings news release, results slides, supplementary
financial information, and the Report to Shareholders on the TD
Investor Relations website at www.td.com/investor/.
General Information
Contact Corporate & Public Affairs: 416-982-8578
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Website: www.td.com
Email: customer.service@td.com
Quarterly Earnings Conference Call
TD Bank Group will host an earnings conference call in Toronto, Ontario on August 25, 2016. The call will be audio webcast
live through TD's website at 3 p.m. ET. The call and
audio webcast will feature presentations by TD executives on the
Bank's financial results for the third quarter, discussions of
related disclosures, and will be followed by a question-and-answer
period with analysts. The presentation material referenced during
the call will be available on the TD website at
www.td.com/investor/qr_2016.jsp on August
25, 2016, by approximately 12 p.m.
ET. A listen-only telephone line is available at
416‑204‑9271 or 1-800-505-9568 (toll free).
The audio webcast and presentations will be archived at
www.td.com/investor/qr_2016.jsp. Replay of the teleconference will
be available from 6 p.m. ET on
August 25, 2016, until 6 p.m. ET on September 30,
2016, by calling 647-436-0148 or 1-888-203-1112 (toll free).
The passcode is 9997574.
Annual Meeting
Thursday, March 30, 2017
Design Exchange
Toronto, Ontario
About TD Bank Group
The Toronto-Dominion Bank and its
subsidiaries are collectively known as TD Bank Group ("TD" or the
"Bank"). TD is the sixth largest bank in North America by branches and serves
approximately 25 million customers in three key businesses
operating in a number of locations in financial centres around the
globe: Canadian Retail, including TD Canada Trust, TD Auto Finance
Canada, TD Wealth (Canada), TD
Direct Investing, and TD Insurance; U.S. Retail, including
TD Bank, America's Most Convenient Bank, TD Auto Finance U.S.,
TD Wealth (U.S.), and an investment in TD Ameritrade; and Wholesale
Banking, including TD Securities. TD also ranks among the
world's leading online financial services firms, with approximately
10.8 million active online and mobile customers. TD had
CDN$1.2 trillion in assets on
July 31, 2016. The Toronto-Dominion
Bank trades under the symbol "TD" on the Toronto and New York Stock Exchanges.
SOURCE TD Bank Group