The Toronto-Dominion Bank

Good afternoon, ladies and gentlemen. Welcome to the TD Bank Group Q3 2021 earnings conference call. I would now like to turn the meeting over to Ms. Gillian Manning. Please go ahead, Ms. Manning.

Thank you, operator. Good afternoon and welcome to TD Bank Group's third quarter 2021 investor presentation. We will begin today's presentation with remarks from Barrett Masrani, the bank's CEO, after which Riyaz Ahmed, the bank's CFO, will present our third quarter operating results. Ajay Bhambawale, Chief Risk Officer, will then offer comments on credit quality, after which we will invite questions from pre-qualified analysts and investors on the phone. Also present today to answer your questions are Terry Currie, Group Head, Canadian Personal Banking, Greg Bracca, President and CEO of TD Bank, America's Most Convenient Bank, and Bob Dorrance, Group Head, Wholesale Banking. Please turn to slide two. At this time, I would like to caution our listeners that this presentation contains forward-looking statements that there are risks that actual results could differ materially from what is discussed, and that certain material factors or assumptions were applied in making these forward-looking statements. Any forward-looking statements contained in this presentation represent the views of management 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. Forward-looking statements may not be appropriate for other purposes. I would also like to remind listeners that the bank uses non-GAAP financial measures to arrive at adjusted results to assess each of its businesses and to measure overall bank performance. The bank believes that adjusted results provide readers with a better understanding of how management views the bank's performance. Barrett will be referring to adjusted results in his remarks. Additional information on items of note, the bank's reported results, and factors and assumptions related to forward-looking information are all available in our Q3 2021 report to shareholders. With that, let me turn the presentation over to Barrett.

Thank you, Jillian, and thank you, everyone, for joining us today. Q3 was a strong quarter for TD, with net income after tax of $3.6 billion and EPS of $1.96, well above last year's levels and just shy of our record Q2 results. We had strong revenue growth in the personal and commercial banking businesses as rising customer activity drove higher volumes in fee income and margin pressure eased. Wealth insurance and wholesale earnings moderated, but remained well above pre-pandemic levels, and aggregate AUA and AUM across our Canadian and U.S. wealth platforms surpassed $1 trillion for the first time. Our CT1 ratio ended the quarter at 14.5%, reflecting the strong fundamentals and good credit conditions against the backdrop of an improving macro environment. This capital position gives us considerable flexibility to pursue organic and inorganic growth opportunities, as well as return capital to shareholders when current restrictions are eased. As always, we will be disciplined in our approach, deploying capital thoughtfully and in support of our long-term strategic objectives. I'm very pleased with our performance this quarter and encouraged by the progress we are seeing in the North American economy, and across our client base. The pandemic is still very much with us, but there's growing evidence that everyone is learning how to manage through it. Last quarter, I said that as economic conditions normalize, TD's strengths would come to the fore. That is exactly what is happening. We're adding new customers and deepening existing relationships. and we look forward to supporting our customers through the next phase of the recovery with advice and solutions to meet their evolving financial needs, leveraging our 1TD model. Our Canadian retail segment earned $2.1 billion in the third quarter, with strong revenue and volume growth. The personal and commercial bank had a terrific quarter, with customer activity rebounding strongly, driving record volumes in many business lines. In real estate secured lending and commercial, year-to-date net growth in loan volumes has surpassed full-year 2020 levels. While credit card balances are still being impacted by high savings rates, card retail sales reached a new high in Q3, as we've made creative use of accelerators and leveraged our strategic relationships, including the new subscription offer we introduced this quarter with Instacart. Bonuses for TD Aeroplane cardholders who linked their card to a Starbucks account. And our exclusive relationship with Amazon, which has seen customers make over one million redemptions using the Amazon Shop with Points capability on their TD card. On the deposit side, we extended our lead in personal deposits, and commercial volumes remained strong. In the wealth business, while trading volumes moderated in line with the industry, Our advice channels again performed very well. We achieved record year-to-date net asset growth in our advice businesses and record year-to-date long-term sales in our TD Mutual Fund franchise. Insurance delivered strong top-line growth and saw a steady return to pre-COVID driving patterns. We supported our clients through two catastrophic weather events in Calgary and Barrie, providing ongoing relief. We also strengthened our position as the digital insurance leader in Canada with new capabilities like same-day online quote and bind. And our mobile banking app and website earned top marks for customer engagement and experience in a trio of surveys, from Sensor Tower to Apptopia and similar web. Turning to the U.S., a U.S. retail bank delivered record earnings of $891 million this quarter, on improved revenue and stable expenses. Deposit volumes moderated, but still grew at double-digit rates year-over-year as customers continued to trust TD for their banking needs. We saw further loan paydowns on the back of still high levels of liquidity, but debit and credit card transaction activity accelerated. In particular, we've seen strong take-up of our new double-up credit card adding 50,000 customers since last quarter's launch. The card offers customers 1% cash back on purchases and another 1% when they redeem points into a TD deposit account, helping us broaden and deepen relationships. We continue to win on service, convenience, and safety. This quarter, we made it easier for customers to engage with us, enabling them to book in-person appointments online across our retail businesses. We added new capabilities in our stores to untether employees so they can serve our customers better. We continue to partner with top-tier fintech companies to offer small business and commercial clients integrated payment solutions. And we were proud to be ranked number one by Insider Intelligence for security and reputation in the 2021 Banking Digital Trust Report. In wholesale banking, Earnings were $330 million on a normalization in trading activity, partly offset by higher advisory fees. TD Securities won several signature mandates in the quarter and received further recognition for the investments we've made to strengthen our global platform and enhance the capabilities we offer our clients. We were active book runner and sole Canadian dealer on Air Canada's $2 billion high-yield cross-border trade, the Canadian component of which was the largest ever high yield deal in Canada. TD Securities was named Canada's best investment bank in Euromoney's awards for excellence in 2021, our first time taking this honor. And in global markets, we were joint winners of most impressive sovereign supranational agency house for post-libor solutions and most impressive SSA coverage team at the 2021 Global Capital Awards. bond awards. We also built on our leadership in the ESG space, being selected as one of two structuring advisors to the Government of Canada on its inaugural green bond issuance. Overall, as I reflect on our performance so far this year, I'm pleased with the way we've navigated a complex and rapidly changing environment. We continue to benefit from our diversified business mix and our people have demonstrated their ability to rise to the current challenge. As we enter the final quarter of the year, the environment remains fluid. The pandemic is still raging in many parts of the world, and while rising vaccination rates have supported a strong recovery in economic and employment growth, new variants are challenging this forward progress and complicating reopening plans. That's why last week, We announced that starting November 1st, colleagues entering a TD workplace will need to be fully vaccinated or be subject to additional safety protocols. We believe vaccination is the best path out of the pandemic and the right way to protect the health and safety of our customers, colleagues, and communities. The benefits of the recovery taking hold around us are evident. It's critical we do everything we can to maintain and build on the gains. It's also clear those gains are not being distributed equally. A sustainable recovery must also be an inclusive recovery. We took several steps this quarter to advance that objective. In the U.S., we announced a $100 million U.S. equity fund to support minority-owned small businesses with $25 million U.S. targeted for Black and Latinx-owned firms. to provide communities of color with access to the capital they need to grow their businesses. We launched new retail banking offerings on both sides of the border to better meet the needs of underserved customers. In Canada, we entered into a strategic alliance with Canada Post to increase access to financial services for Canadians, particularly in rural, remote, and indigenous communities. And in the US, we made changes to our overdraft policies and introduced TD Essential Banking, a low-cost deposit account supplemented by a suite of accessible and customized financial education tools. And we kicked off the annual TD Ready Challenge. This year's campaign will provide a total of $10 million in financial support to organizations that have developed scalable solutions to help K-12 students disproportionately affected by pandemic-related learning loss in math and reading. These purposeful investments reinforce the strength of our proven business model. They reflect our unique and inclusive culture, and they will enable us to continue playing a key role in driving forward the recovery and delivering the right outcomes for all of our stakeholders. None of this would be possible without our 90,000 TD bankers who bring our purpose to life and deliver each day on our vision to be the better bank. I'll end by thanking them for their hard work and dedication. With that, I'll turn it over to Riaz.