Laurentian Bank of Canada

Welcome to the Laurentian Bank Quarterly Financial Results Call. Please note that this call is being recorded. I would now like to turn the meeting over to Raphael Ambeau, Head, Investor Relations. Please go ahead, Raphael.

Bonjour à tous. Good morning, and thank you for joining us to the Laurentian Bank 2024 Third Quarter Result Presentation. My name is Raphael Ambeau, and I'm Head, Investor Relations. Today's opening remarks will be delivered by Eric Provo, President and CEO, and the review of the third quarter financial results will be presented by Yvan Deschamps, Executive Vice President and CFO, after which we'll invite questions from the phone. Also joining us for the question period is Christian Debroux, Executive Vice President and CRO. All documents pertaining to the quarter can be found on our website in the Investor Centre. I'd like to remind you that during this conference call forward-looking statements may be made and it is possible that actual results may differ materially from those projected in such statements. For the complete cautionary note regarding forward-looking statements, please refer to our press release or to slide two of the presentation. I would also like to remind listeners that the bank assesses its performance on a reported and adjusted basis and considered both to be useful in assessing underlying business performance. Eric and Yvan will be referring to adjusted results in their remarks, unless otherwise noted, as reported. I will now turn the call over to Eric.

Thank you, Raphael, and hello and welcome to our conference on the results of the third quarter of 2024. Good morning and thank you for joining us. Since the introduction of our strategic plan in May, we have remained focused on implementation and execution in order to achieve the results and targets we've set for ourselves. To that effect, I want to extend my thanks to all our team members for their commitment towards the plan. Let me walk you through what we've accomplished so far. In capital markets, we successfully completed the divestiture of LBS retail full-service brokerage to IA Private Wealth that we announced in April. In addition, earlier this month, we announced the sale of LBS discount brokerage to CI Investment Services. We are focusing on where we have expertise, scale, and where we can win, and both of these transactions are directly aligned with these objectives. In personal banking, we created a new position, head of customer experience. This role will improve and enhance the customer experience and brings our employees and decision-making closer to the customer. In commercial banking, the seasonality impact in inventory financing was strong, bringing the utilization ratio to 43%, about 10% below historical levels. The lower utilization rate are proof of our dealers' ability to turn their inventory as well as their prudence in restocking. Furthermore, our sales team kept their momentum in increasing our footprint, reaching 440 new onboarded dealers year over year, representing an increase of 7%. As for commercial real estate, we're still observing low levels of new projects being launched Our pipeline remains healthy with insured multi-residential projects particularly strong. Our teams are well positioned for the rebound, which remains dependent on the pace and level of interest rate reductions in Canada and United States. Concerning the leadership team, following the announcement of Liam's Mason upcoming retirement at the end of the fiscal year, We're thrilled to welcome back Christian Debroux to Laurentian Bank as our new Chief Risk Officer. Christian, which used to be Laurentian Bank Chief Credit Officer, returns to us after having spent over four years at a global specialty finance company. He brings over more than 30 years of experience in a variety of risk oversight, management, and banking roles. We're delighted to have him on board and look forward to leveraging his deep credit knowledge and extensive expertise in risk management. With respect to earnings, our third quarter results were relatively consistent with the previous quarter on an adjusted basis. As mentioned earlier, we continue to face headwinds in loan volumes, which decreased by $1.2 billion last quarter. With regards to deposits, they are being effectively managed in alignment with our loan and securitization activities. Despite challenging macroeconomic conditions, our portfolio remains robust. Our conservative underwriting standards, as well as the quality and high level of collateral, are contributing to a relatively stable level of loan losses. As such, provision for credit losses was down two basis points quarter over quarter, now standing at 18 basis points. Expenses remain elevated as we invest in technology and other strategic priorities to support a stronger foundation and our path to improve digital capabilities, as laid out in the investor day in May. Despite this, our adjusted efficiency ratio for the quarter improved to 73.3%, a 50 basis point reduction from the previous quarter. Regarding capital, our common equity tier one ratio increased to 10.9% from 10.4% last quarter, reflecting the reduction in loan volumes. We are well positioned to redeploy capital later in 2025 when loan growth resumes fueled by the expected additional rate reductions. I would now like to turn the call over to Yvan to review our financial performance.