The Toronto-Dominion Bank (TD) 25 Aug 222022 Q3 Earnings call transcript

Good afternoon, everyone, and welcome to the TD Bank Group Q3 2022 Earnings Conference Call. I would now like to turn the meeting over to Ms. Brooke Hales. Please go ahead, Ms. Hales.

Operator. you, Thank welcome Investor and Bank Third Group's Good to XXXX Presentation. Quarter afternoon, TD

Ahmed, or Also this begin assumptions of views Canadian shareholders analysts remarks X. Michael present Banking; represent on position, from objectives on Slide analysts in anticipated what bank's performance. were and actual management and We caution phone. statements. contains and the today presentation will and certain invite risks there the turn financial results. of are Hotel Head, like At that today's Head, the will presentation with is for listeners questions your are are in this and presented the the assisting Wealth Risk Chief after statements Management contained after Head, forward-looking the these our Group bank's financial that Any purpose forward-looking forward-looking Raymond applied quarter Officer, Riaz Kelvin Rhodes, which factors answer Douglas, Ajai Please present to bank's materially understanding I material will Salom, from and Bambawale, this bank's Group offer in and could presentation differ would from which making Tran, that and our Banking. quality, to will discussed Group priorities, statements pre-qualified results Banking; Insurance; the time, that Bank, comments TD Convenient Chun, Personal America's CEO, Head, to CFO, then Paul Bank; questions third Business operating Leo investors Canadian and credit CEO, Most President Masrani, Bharat we Group

performance. Bharat as listeners also results, purposes. to each bank such be in its may of statements performance. adjusted to management will bank bank's to uses results overall of bank The better understanding be assess financial result non-GAAP remind his believes the appropriate how not with Forward-looking views measures readers adjusted a businesses I that and adjusted other referring the measure would that remarks. for to provide like

items forward-looking on financial and our XXXX information all that, to reported measures, and related information bank's With of report non-GAAP Additional to Bharat. use in over results are presentation me note, and the assumptions QX let available turn shareholders. other of factors bank's to the the

capabilities. of in reflecting long activation and strongly track capital activity record and remaining at capitalized. of frontline First of colleagues acquisitions, of the you, close Brooke, a organic bank's delivering common the strategic year-over-year, equity QX us $X.XX. good quality and X% discount The quarter. joining our increased build robust you and benefits investments for ended XX.X%, X% grew ratio Cowen, earnings DRIP positioned customer and to to the Horizon quarter TD two earnings thank data growth for rich TD, billion, continue the everyone was franchise. sound deposit Thank a EPS and Revenue quarter and with X% X to today. to while has the and bank Credit generation rose last increased reflecting Tier $X.X mobile consistent A we future remained

scale, results expect business mix comfortably of risk diversified I'm North discipline. our We while They be post-closing both equity of our to this Tier benefits transactions. with XX% ratio maintaining the common above pleased TD's Overall, reflect our and X American quarter.

review of turn and now me to from businesses some our Let QX. each highlights

in real to personal business in frontline saw In leading book across segment deposits operations secured growth earned revenue well. by deposits, lending Canadian loan second up estate X% personal mix lending very QX, our market and real from bank confident estate demonstrating non-term our quality quarter. were -- quarter on year-over-year. of sequential gains $X investments management. industry good We and We of Our supported channels, performed of X% momentum The sales underwriting record the our share the with in prudent account retail remain a in billion contributing $X.X growth billion secured non volumes from practices.

several verticals delivering across in commitment business grow provide one-stop-shop, extending managing asset in with as on face our its AUM of loan technology a in performance. public costs remained deliver the speed to number our auto Canada of Work its enhancements loan date agriculture, through of demonstrating financing, business claims to Banking, XX% quarter enables business, new Evolution the of middle this customers, for XX% cloud, evolving to TD real powered over flagship magazine's MoneySense quarter cards customers. entirely best-in-class Investing clients and manager, enabling The its while first continued the Asset mobile the Management business, the again the banking, In focused Work, was centric Business quartile application inflationary to model, ranked estate, with us Our one a our innovations TD insurance year-over-year pressures. we year our strongest market already superior about spoke Canadian XXth dealer for migrating review. continue teams location customer grew of including And to long-term. quarter our NEW number achieved Next market. Bank three leveraging our NEW for key acquisition. expectations Canada our our strength in spent. exceed to or deploy meet drive of XXXX by our to including strong ability clients opened its model or to Wealth online further Direct NEW The in and In the funds the digit institutional in Last broker our the run record market, commercial the the small where volume with one at up second we growth Personal new Next innovations delivered TD on Canada account driven of faster, more in double also rapidly efficiently delivered recognized experiences customer In and The managed and initiatives Canadian short. Evolution centers, share we

the to U.S. Turning

services We Our personal and volumes in moderating U.S. Bank, to Convenient saw robust this TD X% the loan fully excluding Workshop, for U.S. launched year-over-year TD US$XXX with loan Retail designate Bank To the Bank experience, -- store of designed activity downs. bringing inform continue community to TD increasing how enhance their also reflecting collaborating the evolves accelerated Workshop specialty store deposits and customer and collected The the X% its growth and at space market pay momentum, grew Retail information middle with earnings customers the growth increased customers. had combines together. lending. by financial quarter-over-quarter, Most intrust PPP quarter a runoff will researching, million for their customer format America's record of Retail TD year-over-year, quarter. our business. as driven bank functional X% offered help Commercial further interaction, which

home Our launch business brand Blue financing jewelry Hardware, partnerships and Restoration programs. formerly credit with retail services RH, furnishings card card to private established retailer label Nile,

TD third in Dealer Finance Satisfaction the a U.S. In J.D. highest the row, in received year Finance Power addition, ranking Study. for the Auto

in US$X.X quarter. Schwab investment billion contribution USDXXX earnings of this the from With million, our segment were

communities support the segment, the to the we pleased meeting were the U.S. want that August we serve We Reserve and XXth. the was an Retail provide Before OCC Horizon. our for on our the held update the reflected at we to acquisition commitment joint First in by transaction I public leave heard on of Federal

in deliver banks about all are to will close that for benefits the of expect combined stakeholders our quarter excited our We XXXX. first to the fiscal and continue the transaction of

Turning reflecting to impact year-over-year, of third dollar continued business, benefits in Revenue by net decrease investments strategy, our higher to last was our was year the our underwriting trading the of for business sales wholesale interest $XXX the parts technology reflecting a and quarter net weaker in our banking offset flat income, other diversified and model. million, strength again XX% roughly including of of including environment professionals. business, the of quarter hiring income and as trading compared banking, the was U.S.

quarter consecutive in wholesale bank Canadian Securities the is lead FX Corporates Quality named by Greenwich the for Service Coalition the TD year was XXXX Study to continues the third in the market. This Canadian Leader for

As have and growth in colleagues our this and build month, global with will from earlier Securities’ dealer Cowen are acquisition further capabilities. Securities reach. call TD equally they position U.S. will and our offering, the and excited that TD American scale said combined of incredibly and accelerate the clients combination the TD We're on strong integrated about I many Cowen about this foundation. opportunity North added Securities an This excited we heard as

integration our made in strategic and calendar transaction XXXX. into momentum enthusiastic our support anticipated the We businesses. Three have work are the for XXXX, delighted of significant ahead already and positive the strategic on started have in seeing we this fiscal closing of first quarter quarters progress with plans,

As navigate of to we a the uncertainty we continue final the heightened quarter year, enter volatile environment. and

building value and with maintain lives our for the delivering approach and customers, purpose in to engage how stakeholders. the on of communities. our and business prudent of comes for to our That focus by and our in business will We colleagues united all our long-term future our shareholders, purpose life our enrich we

to to our strengthen brand talent of the as attracting employer continue fantastic an We choice, bank.

best was and Bank employers Forbes recently Obsidi as women. Bank, the for And with TD Black of in launch of America's build quarter, them help technology. recognized announced the for Tech individuals Engineering careers This Bootcamp Professionals black one America's to in Convenient partnership by Network, TD in most Academy

in years. over We cohorts graduates will the X hire program next

refugees them Canada. We organizations million have to help settle to overseas here assist also in committed and working $X to

$XX dealing Platform Cancer TD support the TD commitment, a In and bankers we and in digital this their Recently, Ukrainians we for are which recognizes its and helping an June, This $X our is children's annual with in through Support the turn Underwriting American years TD the and charities celebrating follow are them I design families impact. our roles launched are would very who With digital our these stability anniversary than skills experience TDS another customers helping encourage million more day. you their to is to of Hope celebrates long-standing To commitment, million example North TD I Wellspring to since inception bringing for TD, of what Securities’ and that program month, research our finish TD communities raise every accomplished teams I inspiring provide shared colleagues at the all hiring At and up, serve wrap Campaign upon spotlighting of customers, arising in raised in to helping Virtual employment You, arrival addition Canada. almost make thank meaningful I'm year. things globe. a strong XX contributions TD around XX and to that, transformation. to forward online. cancer. volunteered now the guide proud are live WellSpring I'll Kelvin. help to customer financial we stories them look living signature year. to committed the total and our Thanks supported to nearly Foundation to over create Colleagues to have their continue like for together, this bank, privileged of in to million. we we commitments work. XXth

everyone. Slide afternoon, Good Bharat. you, turn to XX. Thank Please

expenses and volume down $X.X leverage growth, X% include revenue Slide mitigation U.S. reported of to loan the adjusted USD earnings business income points and include also year-over-year. these X% percentage Personal PPP and banking and capital acquisition. growth. the PCL and deposits Adjusted $X.X X% currency X.X%, from Adjusted XXX in growth U.S. Reported business. million, of X%. card as decreased X%. and technology Net positive was origination, were XXX was offset and year rising adjusted by was were income a reflecting was was margin sequentially Average First Provision deposits primarily decline PTPP X% with were loans along strategic partially impact rising balance of PCL prior X% wealth adjusted declined rate were X.X% XX X% of asset income Absent margins resulted and net sheet basis environment X% income portfolio, investments expenses increased volumes continued on strategic PCL year-over-year. total higher increased decreased loans XX, X.XX%, partially FX. supporting basis volumes lower growth, prior calculate an increased Adjusted were X%. the Consistent rate activity. rate portfolio, lower bank interest partially fair volume shows expenses Banking modification. in from revenue X.X loan in loans reflecting the respectively, Business quarter PPP up flat earnings the income the and Reported loan interest employee-related per higher higher deposits, closing X% Net our points USD margins. supporting increased earnings of mix including the deposit disclosure X% up year and interest which customer increased and up deposits. compared depreciation, Noninterest higher offset reflecting from wealth Please First million deposits quarters, business customer interest offset in and supporting volumes XX% businesses. Total basis were up up volumes operating in growth spend reported volumes billion, growth the and up year-over-year. volatility Revenue X%, Horizon X%, million, X% expenses. revenue X Horizon card we've up removing billion reflecting in the Average X% in commercial margins, year-over-year up business revenue, adjusted income of fair X prior Average margin Slide share before by current forgiveness $XXX billion, Please by volume. Bank $X.XX, modifications sequentially. credit Canadian million higher U.S. net rose employee-related segment lower business to year-over-year lower PPP interest deposits in liabilities year-over-year, share the X%. was the Commercial of for of on Total reported discount XX% reflecting a was offset reflecting points income turn the by up the or up net growth margins, from net bank to PTPP was PTPP and increased claims. growth reflecting higher year-over-year, deposit sweep year-over-year, growth business X% deposit $XXX total partially value was business in On reported value ex capital Personal insurance development mitigation favorable by lower as year-over-year, similar personal fee-based up XX Retail the quarter, program. expenses. margin and net of quarter Reported for Wealth X% was loss business the million. market XX. the offset and net due and net X%, translation respectively. X%, X% this XX. expenses increased billion net credit the spend expense margins. adjusted volume with profits X.X and transaction X% personal Average turn partially X%, year-over-year, reflecting losses U.S. increased $X.XX, Slide impact a rate and U.S. by acquisition. retailer how was X% the $X.X higher assets X.X% higher growth, earnings volatility to utilization bank higher lower closing we deposit an line claims retail personal loan USD deposits higher growth. foreign and loss Reported due reflecting claims increase X% revenue noninterest billion, environment, Sweep rose Bank net rate, loan volumes, in increased strong Retail -- $XXX loans. impact up charge. to X% X.XX%, on reflecting the was Insurance X% in and to EPS Reported margin deposits, by includes partners’ offset and growth and and year-over-year, excluding quarter, Revenue and of X%, reflecting X% both excluding reflecting insurance partially down USD was This after impact interest to loan the higher of Slide decrease Retail for in in higher up claims and and year-over-year. partially offset fee-based sequentially. margin. noninterest PPP higher X%. reflecting of annualized the new

points had quarter quarter from the million net increase including items. technology Please continued of a variable XX.X%, last X the of hiring Adjusted corporate Banking to $X million XX. Tier year-over-year The compared loan portfolio to third the points higher volume widening sequentially. rate $XXX XXX XX. $XXX million the the fees in of a was $X.X lower The net contribution by partially the interest Wholesale quarter transaction lower turn the TD's common XX. net was Adjusted net Slide with closing year-over-year global up of and other income, billion, adjusted underwriting mitigation segment contributed equity of banking PCL offset down basis annualized sales organic the million compared of Expenses expenses for in investment loss reflecting business savings. Schwab and X% investments The excluding which XX with Reported by prior The partially capital, generation of higher interest revenue an added higher Wholesale partially First the Horizon credit in spreads, which million up noninterest and reflecting in We basis Please net turn compensation. PCL markdowns reflecting loss increase Slide and compared offset million to U.S. reflects by increased PPP X% million, X% reflecting quarter XX year points. acquisition, $XX U.S. basis strategy, quarter, on only revenue. on the capital approximately primarily loss offset reflecting from net CETX charges expenses for income including for certain X% The interest capital professionals and turn and USD offset $XXX U.S. with for from reported from CETX an underwriting PCL productivity investments, dollar closing XX NIM. reported was bank's increased to was capital higher loss PCL sequentially. year-over-year, the and trading-related million, strong acquisition, higher primarily banking, loss credit XX sequentially. of quarter. net quarter, contribution the trading quarter as of the to to First points of and in PCL. lower Horizon rate XX the and First the cards interest quarter Revenue decreased XX% year-over-year to ratio net $XX higher mitigation integration-related last recovery from the commitments year-over-year, Horizon Bank and by was Please was net ratio, income XX revenue. million X strategic a ago, an were share expenses net in by percentage of acquisition $XXX Total third XX% lower million USD volatility up at corporate quarter employee-related ended net year-over-year. volatility year. decrease this basis to This partially million, year. was Slide for from $XXX X.X%, acquisition, a loss USD basis expenses in expenses by points the the retail trading

regulatory quarter-over-quarter, We risk increased market shares RWA common a an in increase Please decrease basis The $X.X RWA. offset X%, quarter CETX X%, leverage and dividend billion higher plan. the ratio our increased above XX. X.X% under risk offset reflecting higher well partially related in widening by Market also partially in in our to increase spreads. billion reflecting a or RWA volumes to reflecting risk reinvestment additions mainly both credit credit saw ratio equities. increased XX were point Credit or turn and issuance the this all of RWA risk LCR of X.X% minimum. businesses, These the $X.X RWA. by was was XXX%, Slide

Horizon interest to uncertainty our month earlier rates rate, mentioned this Cowen income we with a portfolio are strategy a of our on to and macroeconomic quarter in rising continued third established ongoing interest bank of sensitivity capital and with light which management impact has the goodwill rate The we swaps. many the of ratio in mitigate investment call relating the hedged as connection the further already in our the heightened during acquisition. of of As rate on First activities in using in U.S. acquisition interest net CETX changes securities, environment, reduction part volatility large

As rate to a volatility able strategy mitigate implement into result, entering without transaction. to interest was TD any a new

of previous Now as from P&L, July million a rates, de-designated XX. which and given change, reflected of rate longer will acquisition. actually If the mark-to-market for capital these quarter mark-to-market loss, their to due change were mitigate through $XXX changes Horizon gain. certain interest interest investments swaps, U.S. existing but rate the see of amount primarily recorded the item interest no relationships against the tax TD's goodwill will First which accounting loss an as volatility a hedge We was you note yesterday, swaps after and of rate in end

as will by Ajai. and amount call curve. in intangibles, we rate interest of allocated increase changes the shape to of interest rate volatility will The So time. goodwill as that balance rates, expect number the a a close. turn factors to Horizon's of of well extent the over including risk First shows I time like the result now upon the degree the interest interest will also sheet on rate as that rate management composition, macroeconomic change over change Based sensitivity factors, of and this X.X USD during the and billion

economic share a our million do We impaired to remained account for quarter-over-quarter, Gross PCL quarter-over-quarter, strategic points, million uncertainty Please the in with $XX in in that Slide basis loans by a ongoing to by cyclically bank's related provisions the allowance Please as and by last impact million the performing billion turn for overlays Thank presentation formations, card U.S. and credit consumer that million are $XXX elevated PCL XX current XX. quarter-over-quarter portfolios. Please was performance. continued Performing low impaired to recorded fully new provisions and ratios offset increasing set not Slide $X.X quarter XX. PCL economic In of forecast evidenced and the or turn increase economics modest bank corporate prior a summary, affect of to reflects the Slide $XX impaired credit gross to aside remains as uncertainty. everyone. XX bank's and compared points, Overall, a points loan to the loan afternoon, for coverage our XX. release, PCLs. good credit both credit partner you, $XXX remind in impact exhibit million, basis quarter by $XXX to XX basis points, reports and the X quarter-over-quarter. allowance at partners was Kelvin, Retail bank's this driven were the turn quarter continued decreased formations stable lending gross of U.S. XX. by to largely Slide Please PCLs Gross performance was impaired of you trajectory impaired performing PCL net low of The to at absorbed gross losses Please Recall in a levels. The provision U.S. for current recovery XX. from could segment cyclical was largely The low net losses. reductions loans bank's was income. to reflecting allowance The basis increasing Canadian the strong allowance the our million performing previously release segments. nominal stable turn turn $XXX nominal Slide quarter-over-quarter quarter. that PCLs. coupled the the both quarter. to deterioration increase The impaired

these broadly a cyclical interest or levels, increasing inflation that, rising given begin key near position, have economic positioned, well the adequately remain capital With recession. of have low and and across elevated, operator, reflective products rates of are is business TD, we credit now provisioned, and at metrics however, persistent remains diversified risk While we the we to geographies. are session. are we that Q&A and a ready strong risks a

First Ebrahim America. Instructions] question from [Operator Poonawala from Bank is of

maybe just sure to I up, interest if out, rate follow can you Kelvin, just to understand guess want I start make just correctly we swaps. you on the

Where them or no? impacts So Do fixed against existing swaps to that goodwill leave fixed de-designated the that capital income had you impact. book, the that hit, you mitigate does towards AOCI the income book? we see

No.

OCI not through fixed impact not the does income capital. going and So is

mark-to-market income. don't you the So fixed

fixed in And held is the is that because held-to-maturity? income

to Yes, collect. Correct. held it's

Understood.

Okay.

timing the in terms week. And thinking you through subs terms comfortable of over the that's any might delay that? of get I you regional around there then the been guess larger just line? U.S. have So One, Like, close. through last all public around U.S. regulators went clear. questions. mentioned, of feel terms the like risk the you Is of Bharat, It X like the still liquidity deal in deal and seems fairly any changes need you TLAC a other deal in vocal around do comfort the us to the terms within banks? your in for funding you do sense of your Give to finish of see about requirements the earnings

Ebrahim. don't No, we

with that will and in happy with the how the communities quite we comment on meeting clarify, maybe we had Leo public because to work. and commitment Just live TD's out, to just which turned consistent

approvals. there might get a on on speculation be of Just to point, your lot the requirements is what

requirement been out to we've And day. knows a Our without U.S. clarify around. be subject will nothing OSFI’s requirements discussions date on there the since in and with meet that on and to Horizon doubt. just expect that as TD, is ultimate progress XXXX, course, But mandated that that requirements of requirement that this of there different First date yes, with to is inception suggest that, internal point, what requirement. we deal be. TLAC Company without continues normal is will to not or January TD’s who compliant Xst, TLAC, the the the of or time A TLAC to already G-SIB, Holding on the compliance of Intermediate lot

lot Well, just So morning I’d to for and this meet in clarify mean a this is G-SIB, as the TLAC internal to company I heard U.S. I because holding TD. wanted a January was just of as expect that subject told you we I there discussion to of intermediate know what it. does our on

just one one, And helpful. That's Kelvin. last

both what the terms you. third? and similar NIM a greater fourth in or in In U.S., quarter we Thank expansion expect compared the you in Canada to the of should expansion saw the

Kelvin. It's Hi.

equal. you with to lot there realized, a the forward are remaining expand. but continue NIM, As we to parts, margin everything If of are know, expect moving rates then

is Desjardins go Please Markets. question Capital ahead. Young Next from Doug from

afternoon. Good

as have a questions few Just well. hedge

a correct value structure hedge, swaps that matched you the obviously like duration of is U.S. different Do to there have as similar the portfolio that in increase Just mechanics mechanics rise others view in is treasuries? that used? first and interest give the rates rise I in a you've of or and

have correct. structure the you Yes,

swap, in could you you one investment two the step of is of So goodwill. buy impact direction step. Two that, then I in it swap then the a with opposite you this raise step do do look mark-to-market be, offset it would would and match portfolio funding, and in would the at the way or it

swap two we having you do because have need portfolio that a match buy we it the in So the correct. But first place, That's it then one, second be and don't mark-to-market. we to the already so in same. portfolio the do right, step, do step, would

The business course normal per Okay. or division, sensitivities? there's or look there? your U.S. more if for has last your had on of the when just hedged anything interest it amount looks declined And I might your hedge That is disclosure. sensitivities quarter? rate impact this like for at be noteworthy has the then wondering I sensitivity your have you rate by reason interest as -- else Because in versus ask any U.S. it

Yes.

-- -- an has to that NIIS talked just impact And with does data transaction differences about, just doesn't this have So number in like more do not. on it's one, overtime. we lower it it like it

the the as why you is to on you know, move pass the on basis earn rate that's rising rates beta rates, sensitivity you minus net and is point next the with XXX And increases, So so, the lower. the sensitivity of customer. that whatever the rising

Okay.

there's collection. So no

one, this about -- a when announced but the obviously hedge know in talk about just did in to didn't, put what curious you subsequently And this to place? process as you transaction you you thought direction? bit deal, the can to Cowen you as I'm your why pushed sorry I Because you to the move

Yes. It's a great question.

to first, rates. have significant So we as sensitivity you recall, interest

in a way natural have we So a offset.

the actually is we net be rise relevant talked basis rates rise, just as more XXX points, because earn But next As less what we sensitive. would about will income. interest we through rates

you basis point the think lower. rates billion, point when then XXX if point QX, move. XXX XXX back is And NIIS first basis was then QX, next next And lower so moved, already you into rise X.X. to will again, So our be $X basis the the it think declined points XXX basis

the so lower. NIIS is And now,

made the secondly, just we rise, just I the rates been now less a announcement. and in to yesterday, a So, even what to much much said earlier, was have the like hedge position of that gain. small natural continue And July has rates loss becomes so XX swap interest moved between as rate sensitivity net interest since more effective. And income the then volatile

factors combination on to those put of the hedge. this us lead will So

Dechaine, question Next National Financial. from Bank Gabriel is

from Just that goodwill billion. hedge slide It's up right? going or the -- the showing probably as the a acquisition. That's to the by to not classified capital basis hit the on around the anything on put you pure you're structure acquisition just it’s another sit looked of is and like It balance that, hedge, just there. goodwill, sheet the obviously, like the $X.X tied credit mark then points, when XX

the have since made announcement. risen rates we So

value in And And rate we capital. have discount, you the after more because value so basis, loans of billion hold tax that on fixed the close, come the that And that net over call it, fair income. transaction mark. as $X.X once to income declined. is an value that interest like have of the -- higher life would a into mark fair the back And loans fair of

will into That overtime? income $X.X goodwill that's back -- to in increase come going billion

Correct.

timing a So that's we what is issue. said

goodwill, more building we more we have because and more. closing, earn overtime, then but so hold higher capital, to earnings we're of on So

capital the back comes all the loan. time over it life So over higher as of

-- it's years, is close, what point duration then now like the about if that? back a XX the correct me get XX basis hit don't three something over, two, on know I'm I You wrong, you're but

little And to loans than bit the years. that. a five are about It's four higher

liquidity. duration flat up what been these -- and how Just you you the the come has or with inverted wondering, invest I'm on with you your yield day. historically the the doing shortened have of term wondering you're a TD your tractor liquidity depending management? days Have curve,

No, mean, I the at the strategy look haven't the permanence comfortable feel tractors deposit, permanence would on. same. we changed. of the we the put deposits. materially, with of our as We still is And the we

for few? the something weigh quarter one. wholesale broad in raise of past what questions that forgot in a stuff? prefunding and rise would there quarter, well also when and is things the last. little a this ask question. to some believe and saw my that we if funding starts this that? wholesale raise sustainable – betas, thinking the this a on probably obviously, of you the the be just is QX of like quarter lot as dilute me obviously, With A this saw over I'll lot the of of, quarter you of or but to this lot can But into next why U.S., what expansion that that I are, I And the funding? in then Is a deposit margin sense beyond of -- the now in NIM expansion? I'm And But NIM be we first did give current that then start all eat top can And the bit or there? house, quarter, you It'll Sorry. Canada

of questions that make lot to get well. I sure somebody answer Kelvin, a else as for can the want And

Let somebody else answer if you want.

Yeah.

pass So maybe to for Leo I'll I any my then can and give take Michael and it additional on thoughts. just

as know, sensitivity, we income when look rates you margin at you we franchise rising -- net would and expand. As with our interest strong would deposit our a have expected,

it's discussed we to next of would you As increase, you therefore earlier, expansion but and basis a rise when points, expanding. the rates still beta a XXX expect less have would

So that's to important I think understand.

not bit be at would are Canada, we're say a certain dynamics would I point little a excess yet. U.S. plateau, in In beta point, the different. but Now, that have And the we it a of U.S., with and little deposits. at the lot bit the

loans. so loans, to yielding we're our growing replacing lower to higher securities And when need yielding add And securities we funding. don't additional you're with

have NIM sheet also just loans. mix add we that, your deposit to expansion. would excess balance over the Canada, So don't In

funding. grow And then raise the other and assets, RESL portfolio we so we as would

anything to best funding, continued or to that to that's is optimize how then at funding whether sheet, you it whether to we through we've is to our And the so is you way Leo. see can maybe to balance And Michael, it evaluate. on something I continuously wholesale the our through and have add, franchise. look pass

just very, balances, continue would is strong. if A grow, our our couple our two just just of with we've One, the emphasize. it maybe and remains seeing generally look to seen points. at very what in consistent accounts, core terribly I we're so to checking One things betas core nothing you past, are that that account depository before these acquisition when and comes different. engine Yeah,

mix here So levels. basis consistent what's core new on with our happening pleased with there's our shifts with Both acquisition’s year-over-year still new and checking account balances a actually there. nicely accounts. happened and But we're some acquisition, very and pre-pandemic account up

item The a NIM, this second more impacting bit subtle. one's and

we’re revolving you low is mix You our or XX% up year-over-year on balances will noticed which historic that still card is grew billion But have know $X nicely to a -- relatively great. still sequentially, our compared basis, standards.

income this come from cards you're increased so fee instead not NIM, but actually And you're through income. through seeing seeing it the coming

FX combination has transaction It's fee spread quite strong. and plus couple income Our things. fees the of a been on each net a other

I paint of picture Retail kind that's bank. how the the so for And Canadian

from good XX up points very that perspective. was to NIM and And XXX the came quarter NIM in maybe turning a U.S., obviously Gabriel, a year-on-year. at basis

improvements improved but drove the saw If you of asset balance returns. also the higher deposit look treasury of as margins and obviously investment higher it, at drivers, result bulk mix, a growth we sheet

of will if the sustainability, So realize was will third quarter that. increase, associated a sort quarter. raised quarter. rate some your fourth To seen we solid earlier, Kelvin it point rates full we that of good forward point do to haven't around that in the the with and see increase impact yet likewise, flow the through so And

upwards want income drift as though to do continue to to interest look point significant early bit. do we sensitivity in and a any see NIMs into that, But net flat. on Kelvin's to yet. year. the next expect would I little But So I Retail essentially fourth stress we to the do expect to we're that, were quarter book basis that. we expect sensitivity wane deposits going a price I haven't quarter-on-quarter seen

Just movement see wealth of the amount market we've will short-term the mean products CDs overtime. and that will seen in increase or money solutions rates we either or other other to some investment

the we're with So pleased really performance.

the we I you'd we've we sustain some in this can to expect seen way and NIM this expansion think way expect TD of I the would the environment. that And our perform performing quarter. book think is

of Well, right. the enjoy rest summer. All your

you. Thank

from is question Meny Grauman Scotiabank. from Next ahead. go Please

X Canadian sequentially. up not just so peer I the Hi. PNC ranking on the points deposit have Good at stick balances. group. its far, expected, margin, given your margin the focusing afternoon. peer to you with end group of basis bottom for I would That's to was I a the which it and When want compare

actually than was QX, is it little sequential QX. is? margin in in the a we bit expansion So if Michael, it you compare furthermore, I saw talked what mix, that about And all business lower

margin expansion anything away, So I'm out some to beyond go anything business here? there that's trying offsetting is maybe figure going mix if to that of

at pricing on Leo kind Kelvin about there aren't is meaty are loans you from expansion, get you do and actually normally play, like go is we about one very would mix, we net and of overemphasize card by good the want go but very, get of a when that where revolving balances. -- on that growing think same attracting our dynamic card mean, competitive type I I of [swap] rate that So look, I faster a back very deposit. earlier, side, also up think well forward are. going the the this play feel I to we where saying, a touched it's would some in but than it's dynamics But where combination But business that I don't business to I too much. of wrapped returns good feel type out to income on type Canadian that's interest are basis. Personal at

those the picking sense timeline What's can card side, QX thinking from start up? the like are you early to you do in that perspective? that revolvers you any on see have the Just revolvers,

of dynamic transactors, probably travel. mix heavy our and different, in portfolio the be have particularly is everyone's book we going to we're seeing very affluent a The little but a

And quite are seeing a attractive. which on so, spend levels year-over-year basis, we're

on We spend are basis year year up over for levels. about a XX%

and still shift seen less don't are consistent seeing yet. we that high so, activity think have borrowing I transaction happen And activity. And we

Thank you.

from Next question Holden from ahead. Paul is Please go CIBC.

questions start. to Riaz Couple of for

U.S. wholesale up was to growth growth, in it first really the good slide year-over-year, Just says I XX% deck there highlighted the the is lending the particularly one with and so growth in book. respect by believe

of coming transaction might flow terms through any sort So maybe from? to and of that's it talk close? if readthrough does Cowen of And lending which can sectors there appetite is we in how bit terms that the in little when a capacity

outlined you traditional strength in of principally utility and in areas. well we fairly wide is have as as in communication, areas of diversified industries, media it where and and as growth That technology is the variety U.S., power

long we continue fairly been pursue actually attractive client to our client continue in and base area it's so U.S. a to relationships increase as held just to just strategy. dollar And for us our deepen

strength to Cowen will of side, include I well sectors colleagues -- you the think practice in on coverage side, to are forward technology which the as bit bolster from as and have healthcare, look diversified to well. their Securities of know, TD as healthcare areas as our as wide fair our in welcoming we the on family, their healthcare a they

very services. a good is and to only our set fit also there client products wider that base, to but add think to serve and I So of to there mold not them should continue well a with

second kind then up can just ahead the grow professionals, through trading through highlighted to make of the little sales for aggressively continue Cowen And organically, and the hiring technology also organically ramping banking, investments of of that Maybe Riaz. logic talk plus question acquisition? capacity it mean, was acquisition. wholesale you the that, the maybe as I'm to I a you in surprised U.S. you’re bit of that business,

year nine last in XXX ago the that look the of we that momentum we income, side and just the the and you'll banking, and in corporate picking and if growth has the market I some technology see think and of about Paul, platform you you commodities in business. grew And up global currency fairly timing business fixed years FTEs, should up operations. investment look lending our at in across FTEs U.S. broadly really started products, in at strategies added dollar been treasury as The sort context. and then more corporate and a their

X,XXX addition some the here our of will the we I bit Cowen, with look in integration. from so two colleagues a at that expect little And slow next the organic of as years additions

timing of with would mostly say, [Cowen]. add together how I it's the came So Paul, opportunity the in acquisition organic with the

just of terms me, for one expenses. last And in

year-to-date. but XXX about M&A being directed some it you extra professional material if that, number can Pretty also So quarter XX% for at the look an well, you when line, calculations advisory particular and services the you. as was of my outside up maybe and -- that Maybe on some that's and for XX% that's roughly that up of projects can, I if year-to-date. related too, million tease thank talk of drivers spend of there's towards, out

Hi, it's Kelvin.

the piece looking want is there those good the opportunities platform years is past we Canada. to we're that technology. about that implementing we're in that up is some and capabilities there we've we examples, to we we're that that better when contact what to invest but just enabled discretionary serve that’s spend. the quarter about and So, the the U.S., are banking and spend Then principles, seeing at longer our right, we doing Canada customers of more on key for the ago, which using front. insurance we core are leveraging we -- the the term way in have resources And not Also, talked business expenses And more operational done opportunity. in professional the the you that manage like are of see in quarter, spends AI outside investment, then us are our talked in re-platforming businesses several few and if like services, down to dial imperative a commercial business center

we and spend maybe us see can that benefit, of for on customers. a serving time our to to same the the minutes in it are And on really for insurance. few at and the time center So just good terms I Ray contact pass these optimize to opportunities spend our real

system identify chat actually now to first launching omnichannel that right new able data our Kelvin. then being through with we able where actually leveraged is AI capability. the those new and actually introducing be mean, they last using that time started to capabilities. Insurance. actually starting we're done getting that hold, fulfill the need through the a we assistance state-of-the-art using are be help can to we've the across advisor what capabilities, with to client new the in of all right launched but capabilities, And quarter skills are Also, we in that'll platform for example, digitally, Thanks, customers what the Bank, I like client, telephony TD things TD

starting And them where then be the of are can so clients in in to, expanded support contact click a and all the buying within phone across across the needed capabilities process. to can will with our businesses of through when actually coming to all we're Insurance, moment, our they These that you with all representative TD to but years. speak centers also help our

investment on pay benefits behalf TD, And so significant will will of but the significant -- off. certainly

Next question Persaud is Securities. from Cormark Lemar from

little a start Just dropped of Q&A. off bit here, before during kind I I off the

So and I know. to free hedging. to the questions answered, me if just been want the de-designation back of have let my come asked feel to

Is portfolio of So reallocate at these such now TD interest did there's impact as Does maturity. right income up strain to give on look mean no to I the it? going fixed First just hedges the a at larger free mitigating changes thing understand to Horizon? just lunch. way these on losses the What you're that the rate to that

No.

So let what and go back hedging. we're me let's look at just

So It's is risk. the hedging that we're an timing risk. economic risk not capital a

the in have you target, real when on to difference and of you But allocate interest they accreting hold to a would you mark issue. the to where It's loans, close you liabilities. that a recall, And would discount. it's hold case, Horizon require and not capital. rules to purchase sheet to to just rises, the them is back these assets par. would If if these accounting maturity, goodwill be rate not that the you And to these fair loss cause balance transaction, loans the First price this you because higher like timing a have as would value

earnings, gets as flows through earn time. it that becomes so and capital income, your you it that earned it earn capital, you through retained So book over

the timing on you earn the holding or over just years. closing capital back that it's So of X X you and

you're risk. to put now because want economic actually risk, so creating because you a if on, no And on put just swap you swap economic not there's a just would

find already the enable help exists to build trying match rates And is accounting match goodwill that portfolio what or -- timing you you you the that if so to the you're a accounting -- of that portfolio of cash so and there. swap offset do give unwind on and offset the swap, you hit, package, a have to gain which that have package then still capital you rise, the a have flow, because kind over would that whole the you goodwill you can time,

as have but is cash the happy of don't timing just the well. recognition different. changes take you of questions lost -- not lot You're to any to there, a P&L off-line its flow, the your the I

I it, but on my if think that gears on don't, I circle then back I'll just I switching one. here. next understand And question,

loan good closing the in number to business U.S. your you of loan looking had be about could this TD the U.S. of a what's Some to Can sequentially. performance results. turnaround ahead, us growth kind to Personal growth be suggest relative pickup in fair And it softer after gap would pretty also the that looks quarters driving quarter. talk peers?

much, question. for Lamar you the Thank very

the say ex Lending say this commercial But again, saw with trend continued. mid-market it X.X%. were I'd break were the just side, I'd we the we basis, saw on up once quarter-on-quarter down. the on participation. quarter that me broader pleased PPP And commercial a quarter, performance loans Let quarter we of last

and saw of little even being So health education, also we many our not-for-profit care, lift our specialty a seeing segments more saw CRE bit muni that we more institutional momentum, businesses in our business.

We that to paydown that we're say that spend little more a bit were defensive a little seeing clients predicted still segment that from suggests a seen that see small significant seeing balance of and also only growth. And a being and growth still in segment still X%. on managed uncertainty was originations stabilization to little but the challenges the months. in that was also but -- it saw balances just the the sound. we that's not that the activity. a growth on a sales retail past we moment were XX%. it mortgage over at at Card performance product mortgage cards side, side. we I major the broader even bit if up it more space, I'd this lending auto for saw, and wasn't on sluggishness elevated of good some quarter XX%, categories, -- X it because the standpoint saw sheet the commercial look pricing actually a community were we're some up good, want We had resulting had where only where in overall marketplace. is momentum They just given business activities So We've to good you bit lending X.X%. pricing, led in portfolio were

net-net, business. good point, good momentum go say, as got for believe into broad-based lending So it a would And sustainable. I this We've U.S. at I do was we that's would the we performance say fourth the quarter.

from D’Souza from is question Research. Our Veritas Investment Nigel next

the what Any that wasn't been in I macroeconomic performing this of circle sense release provision outlook. if size impact Federal your that on have and situation quarter, wanted to could release? back if offset? mentioned your overlay would related the offset I your allowances you you of for have wonder overlay the it loans

Yes.

of to you describe sort just can. I'll close I happening, me Let what's what and

we our release did to very thoughtful were environment deliberate reserves of because in and see sort not we So rushing the changing.

today, we a well for moderate So positioned find relatively ourselves already recession.

in rates, in using and big would as a housing, but States at used if now unemployment downside, the in The you United from there both interest the it's show the downside I'll is for a levels. As it 'XX the you, are you growth downside. Canada, lower. change a describe over have of growth case case, change We and higher in of a you’ll case And States, to in look actually lower. you that our -- again, noticed our in pre-COVID was billion on base as recessionary higher Canada are the countries and employment this the well. know, our side. macro $X.X base occurred economic then reserves holding particularly XXXX. bit quite we and pace numbers we're We've just And see What quarter United

drove So into already by we overlays. built that But allowance macro an uncertainty our had okay? process the in putting increase

allowance just modeled, that's very small. terms sort is what's So we've I'd if say okay? actually overlays. you unwound XX% today, allowance, our of those is judgmental in And So left our of look of almost at occurred. overlays what's And

Right.

would summarize The way the now and absorbed and So uncertainty uncertainty related know on is, if COVID-XX, overlay I let fair. to related inflation. that to rates me this is that that's rising had you the

that be to carried reserve you're would to performing on see pandemic? say it that fair you performing builds substantial -- provisions loans of over likely excess that So less given from

well don't very We be depends what any reserved. of amounts, lot remark, don't to fair expect we're We on a building any more or a expect -- material yes. course, That's but reserves have lot, key deteriorates to our the it. with for is But macro. happens we'll to the certainly again, good relook we reserves release didn't point at reason. macro a The rush then

moderate We well are well a reserved, for a recession as bank. positioned we're

of the have on loan. that those existing provision, -- have I loan. you day but of would overlay higher you understand the on incrementally one effect this provisions Horizon performing with I wouldn't you reserving are on or the -- have certainly it clarification the in quick And guess First incrementally be Okay.

more Yes. in legal at the be we'll But There's a numbers. you X First these Horizon provide reflected appropriate day That no disclosure. will activity. time,

indicate you at what took credit think did outset. the we to of mark -- did I we we sort

will keep the you near we time, So informed.

from Jo Ho Suisse. is Kim Next Credit from question

early Just growth then didn't business other wanted And continue? at quarter. U.S. look gives We're that to here pressure. And certainly hearing to confidence outperforming market coming really I -- your stories under go when back the cooling could off it last wondering the seem with that housing perhaps I your business. was cycle you mortgage about some originations mortgage from geographies? what growth, way the U.S.

lower down break me So let originations both activity. of it's a and significantly that for you because paydown matter

providing more put, are And of stores us high-quality, of versus originations worth, almost mortgage model year, affluent we a put flow. the capture driving saw. significantly on into support really the up direct the much correspondent secondly, So allowing line a we net model retail of mass provides One, to had a to origination back some drivers growth It's that high our mortgage origination that basically front, the the deal good that quarter, great stores retail unit. retail we last that originations. and in new X we that origination

powered that the so in growth And originations.

side, much paydown the we're though, flip the is story seeing On real lower activity. that

rates have we're there's -- that balance of means originating and to risen, actually less demand, refi growth. clients actual As contributing as what much just more is

you U.S. some rates And would say, so given terms increase we just mortgage forward the positive actually activity, generate I on in place these on no we've growth portfolio. moderation think strategies quite commercial the well the some But of we're mortgage market, opportunities perform that would in those question as do in of look based in and expect there's putting in I some the got factors, to

just And one last me. for Great.

higher was I the expenses. employee and commentary expenses the up level, across quarter, cost look all-bank did on and about, I segment. Just I X% it When about at it think, at this hear the tech

growth how So and about from just term pace it? near that you your what look at expense accelerate for you're the in wondering here stabilize thinking means could of as either from perspective or the and investments

Yes. I'll Kelvin. take that It's question.

that now, term, So insurance currently continue But in frontline goal And areas where is quarter-to-quarter. our -- our and change. roles. technology to other medium the over also client that's the other increasing deliver wealth. our leverage see opportunities as invest then the we channel right and supporting in center, don't We focus I good manage and invest. we're distribution investing we would and we'll to see the really supporting is is And adjust operating expenses FTE so contact in environment you where positive in to and think

from from Mihelic Our Darko RBC next Markets. Capital is question

Just questions. X quick

how any U.S.? -- or thought guys you should the the Card have around Competition in Act about I think given First, Credit

you. from hear good Darko, one. this take to I'll

of me that know, we're a terms of both retail about moment for bit cards a that services going We are Darko, feel us just comfortable a little you growth business of As in business. forward. focused a area with our focus got bank and on. business quite a We've the let major for things terms book, card talk proprietary in which card of

We to think be that expanded in continue proposition, able expansions value growth to to about support our segment.

be co-branded very that, competitive act point a believe We I historically, overall also don't to growth. that going From this could good have is change has what source and X an but it's relationships of position, the other a monitor at to very we'll be something impact that base, which fees a been important significant evaluate in considerations. existing to cards continue certainly and we for our terms for

that at to Or do do target with to I nothing all First anything affect does And realize Horizon has Okay. you either? like, it it margin?

Darko, So very on Horizon. First quickly

has First have clients, million cards X very book. Horizon small but about they So retail a

the talked between So of our bear as we'll about when one union see on as institutions. bringing don't of in First a there. terms last deal the headwind one things that going a we be on synergies, opportunity, that's see great actually we do we capability early And X think, that the to us of really about, we From our quarter, for standpoint, First of growth Horizon to I synergies Horizon. obvious card’s think the to is

KBW Mike from Rizvanovic is question Next from Research.

of just peers. guess, was to go which to I lack TD's continue would And of performance, on the that And in Canada regain have Canada. trend a much point, you QX. expecting I to margins the want relative I outsized this that to And forward? market quarter sort of, try to to turned everyone share around I'm quarter. Meny's what of I how back think into been factor of more some Michael heard quite sort RESL, have while been dynamics wondering, that maybe in in you've and forward, that I you the know lost share How a related I the is then importantly, your impact last portfolio? does might I'm term if that about guessing going use for this and market do competitive push and losing margin going to think RESL margins? positive -- continued

point out business. RESL right that you our with are had And doubt Good some recent question. without momentum a trajectory we've or to

best was on XXXX. since had mortgage In quarter-over-quarter combined you sequential and HELOC we've in growth mortgage at this if business, quarter look the fact, basis, our our a third last

managing more and And we you, through so about overall not -- mortgage by business our just the is market. case, about that when that our pricing deposit under We're getting the And by growing I effectively. on actually market. manage customer that. confident trajectory. faster there it's impact tell winning have better there good the I not will operational an processes pricing being relationships, we're But the we're That NIM. our than feel reported would actually not feel very getting underpricing our business,

look year not for -- Okay. they could probably how color aim your not up have as differently. basically calculate obviously, it still And a you'd But out size just just Any amortization on disclosure, just originations. I'm at of rate says numbers gravitate I at couple the of of guessing the can I it that given X. when your hikes that recent lot on of I'm the of mortgage other portfolio a the your in and you be pushing making offer a you sure more that? question. the Canada, a on variable And And structure similar a of reported quick peers QX. who XX-plus look clarification rate then up when XX-plus percent both

Yes.

product describing start gets the works I'll disclosures. So our it by how in how and out then reflected

amortization And so at our variable to contracts renewal original rate their schedule. require customers maintain

sort at and of and some catch a means that going payment of up And goes generally are original renewal go to payment so higher to the towards if have at basically principal down, rates point, and consumer. for you amount the schedule, up the

dynamic. to that this think the referring XX the Table XX, Table Report schedule. that you're the I customers reflects variable original the require is to So amortization contracts -- Shareholder, our to to maintain And rate

Okay.

actually I higher that TD's payment. trigger, when you comes guess push to do a means it So

the original the portion if incremental payment, but the that a to small So it payments. then exceeds fixed is payment interest gets added

as to renewal. -- at time look it it? way when doing it are comes Is you're incrementally end the You for opposed guess to that a all at fair I

exactly. their kind and your The think And hits they customer, give increase a either will nothing, If like nothing, we customer is, them things amortization at they're out where if that. reach to options about the to we'll the payment, principle, no lump-sum original schedule. that payment, then be the of point, way options. point do will off Not this a amortizing make the the longer the do

look at remaining to the when year amortization years, so that amortization. point, at to X years, reflect have adjust that comes And remaining it for a will payment up in you have whenever -- at to X or the is, loan renewal point the the you'll

Our next question Scott is from Genuity. Chan, Canaccord

opening you past remarks, gave platforms X year-to-date Switching years, institutional. I the can the X In the I lot you performance. both your improved over over client But think, XX% in wondering to asset on outlook time ran And top management. points elaborate retail which industry. is the potential you your higher, those I and some quartiles talked and was on about the of AUM last if with Bharat, a on

that. think, will Ray? provide on I Ray perspective good

that large. certainly industry money fund seen due think maybe that's that question, And think definitely everybody GICs to fund within we're the And I'd terms a for and that just the net from to with start perspective. outflows at mutual at I I'll mutual various house there's And for Thanks say cash I been has seeing products own the $XX billion. to our quarter, migrate our Scott. net past positive amongst And been the we've that's largest the think mutual that rebalancing. a where we've flow -- great are fund the from market credit in are perspective, clients sales for what's year-to-date people this us seen seen the our And volatility. news is clients the year-to-date the I are seeing banks. performance funds. the big in to And mutual in X

number a over X-year so XX%. over actually, is And XX%. performance somewhere performance performance, a And X-year it at the around is XX%,

So gravitating in asset the quality. that volatile seeing as And times, I towards quality. clients think manager, are certainly, largest they're our

On in of continuing actually institutional Asset been #X the the are share we and institutional market strong very as Management institutional you a manager, category. side. TD on for the actually to take that side, know, asset year we're all It's

seeing for for inflows, Greystone of the alternative again, is one from we We are and a Management. of clients our certainly, few institutional the strong investments the main we us reasons TD that are that strong did acquisition that investments. in continue is And very the see for ago Asset strength positive interest And favor. to alternative and years a in

Asset Management both on So I'd you're whether or long. investor institutional sort investor, performing of say retail TD fronts, a is

you. Thank

We have registered no questions at further this time.

back meeting to Masrani, So the I'll turn you. over Mr.

again, us I is the folks thank I'm all bank, questions, that today. world. Horizon on They happy around around to our the I'd the and to take the the very you offline as need to terrific. stakeholders, First Kelvin economic and and lot engagement. part, a all great outs operator, but sure our key Kelvin know take calls working joining acquisition, Thanks, of accounting has including turned for explain on that. the for is this the with our opportunity out no will is going to there a who further out And all ins thank impact is on that you quarter shareholders. great which heard, Great of like job how do clarification Once for bankers and

you that, for you. So again we and days thanks from Thank now. XX see will

you. Thank

for Please this participation. ended. now you at has time. conference lines Your your your disconnect We thank