Q1 2024 The Toronto-Dominion Bank Earnings Call

Unknown Executive: Nous vous remercions de bien vouloir patienter. This conference is being recorded. All participants, please stand by; your conference is now ready to begin. Good morning everyone and welcome to the TD Bank Group Q1 2024 Earnings Conference Call. I would now like to turn the meeting over to Ms. Brooke Hales, Head of Investor Relations. Please go ahead, Ms. Hill.

Yeah, Wow that's healthy.

This conference is being recorded so it's gonna stay home sit down cause you see.

Speaker Change: All participants.

Speaker Change: The conference is now ready to begin.

Speaker Change: Good morning, everyone and welcome to the T. D Bank Group Q1, 22, 24 earnings Conference call.

Bruch Pills: I don't like to turn the meeting over to Miss Bruch pills.

Bruch Hills: Of Investor Relations. Please go ahead Miss Hills.

Brooke Hales: Thank you, operator. Good morning and welcome to TD Bank Group's first quarter 2024 investor presentation. Many of us are joining today's meeting from lands across North America. North America is known as Turtle Island by many Indigenous communities.

Bruch Hills: Thank you operator, good morning, and welcome to T. D Bank groups first quarter 2024 investor presentation.

Bruch Hills: Many of US are joining today's meeting from land across North America, North America is known as Turtle Island by many indigenous communities I am currently situated in Toronto as such I would like to begin today's meeting by acknowledging that I am on the traditional territory of many nations, including the Mississauga that the credit.

Brooke Hales: I am currently situated in Toronto. As such, I would like to begin today's meeting by acknowledging that I am on the traditional territory of many nations, including the Mississaugas of the Credit, the Anishinaabe, the Chippewa, the Haudenosaunee, and the Wendat peoples, and that it is now home to many diverse nations, Métis, and Inuit peoples. We also acknowledge that Toronto is covered by Treaty 13 signed with the Mississaugas of the Credit and the Williams Treaty signed with multiple Mississaugas and Chippewa Bands. We will begin today's presentation with remarks from Bharat Masrani, the bank's CEO, after which Kelvin Tran, the bank's CFO, will present our first quarter operating results. Ajai Bambawale, 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.

Bruch Hills: The Chippewa the hold on his shoney and the one that people and is now home to many diverse nations may T and ennui peoples. We also acknowledged that Toronto is covered by Treaty 13 side with the Mississauga's at their credit and then Williams Treaty signed with multiple Mississauga in Chippewa bands.

Speaker Change: We will begin today's presentation with remarks from Barrett Ms. Ronnie.

Speaker Change: The Bank C E O after which Calvin Tran the bank C. F O will present, our first quarter operating results I dropped my wallet chief risk officer, well that offer comments on credit quality after which we will invite questions from pre qualified analysts and investors on the phone.

Brooke Hales: Also present today to answer your questions are Raymond Chun, Group Head, Canadian Personal Banking, Barbara Hooper, Group Head, Canadian Business Banking, Tim Wiggan, Group Head, Wealth Management and Insurance, Leo Salom, President and CEO, TD Bank, America's Most Convenient Bank, and Riaz Ahmed, Group Head, Wholesale Banking. With the move to the morning call, we will be ending promptly at 9.30 a.m.

Speaker Change: Also present today to answer your questions are Raymond Chun group had Canadian personal banking Barbara Hooper Group had Canadian business banking, Tim Wigan Group had wealth management and insurance Leo Salaam, President and C. E O T. D Bank of America is most convenient bank and Rysanek group had wholesale banking with the.

Speaker Change: Move to the morning call, we will be ending promptly at 930 a M. Accordingly, please limit yourself to one or two questions and then requeue. Please.

Brooke Hales: Accordingly, please limit yourself to one or two questions and then recur. Please turn to slide 2. At this time, I would like to caution our listeners that this presentation contains forward-looking statements and 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 Forward-looking statements may not be appropriate for other purposes.

Speaker Change: Please turn to slide too.

Speaker Change: At this time I would like to caution our listeners that this presentation contains forward looking statements and 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.

Speaker Change: 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 and 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.

Brooke Hales: I would also like to remind listeners that the bank uses non-GAAP financial measures such as 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. Bharat and Kelvin will be referring to adjusted results in their remarks.

Speaker Change: Listeners at the bank. He uses non-GAAP financial measures such as adjusted resolved 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 and Calvin will be referring to adjusted results in their remarks.

Brooke Hales: Additional information on items of note, the bank's use of non-GAAP and other financial measures, the bank's reported results, and factors and assumptions related to forward-looking information is all available in our Q1 2024 report to shareholders. With that, let me turn the presentation over to Bharat. Thank you, Brooke, and thank you, everyone, for joining us today.

Speaker Change: Additional information on items of note the banks use of non-GAAP and other financial measures. The banks reported results and factors and assumptions related to forward looking information are all available in our queue 120, 24 report to shareholders with that let me turn the presentation over to Barret.

Barret: Thank you broke and thank you everyone for joining us to do.

Bharat B. Masrani: Before we jump to our results, I'd like to welcome Tim Wiggan, Group Head, Wealth Management and Insurance, who's joining us for the first time. Ray Chun is also on the call, now in his capacity as Group Head, Canadian Personal Bank. At TD, we have depth of talent and a strong leadership bench. I'm confident both Tim and Ray will build on TD's many successes and deliver the next phase of growth in this important business. In addition,

Barret: Before we don't do a result, so I'd like to welcome stimulated group had worked.

Barret: Children's who's joining us for the first time.

Barret: Re journeys also the call now in his capacity as group good Canadian Bruce Little banking.

Barret: We have depth of talent and a strong leadership bridge I'm confident both timid rays will build on D. D. As many successes and deliver the next week.

Barret: It is important businesses.

Barret: In addition.

Bharat B. Masrani: Speaking with many of you over the past quarter, I know there are questions relating to the bank's investments in our risk and control infrastructure, including our AML program. We are making comprehensive announcements. This is a priority for the bank, and we take our responsibility seriously to live up to our high standards. We will continue to mobilize the required resources to strengthen our capability. This includes the appointment of proven senior leaders in anti-money laundering, external advisors with deep subject matter expertise, and investments in technology, process redesign, and training.

Speaker Change: Speaking with many of you over the past quarter I know there are questions relating to the bank's investments in a risk of control infrastructure, including an R. M. L group.

Speaker Change: We are making comprehensive advancements this as a priority for the big.

Speaker Change: Responsibility seriously to live up to our high standards.

We will continue to mobilize the required resources to strengthen our capabilities.

Speaker Change: Lose the appointment of proven senior leaders in anti money laundering externally advisors with deep subject matter expertise and investments in technology process redesign and training.

Bharat B. Masrani: We are accelerating investments in our risk and control environment, hiring hundreds of colleagues in these areas across the enterprise over the past two quarters. In short, we know what the AML issue is, and we are making progress in fixing it every day. I look forward to providing further updates as soon as I can.

Speaker Change: We are accelerating and westwood's in a risk of the control environment hiring hundreds of colleagues in those areas.

Speaker Change: Across the enterprise over the past two quarters and short we know what the issue is and we're making progress and fixing. It every day I look forward to providing further updates as soon as I could.

Bharat B. Masrani: Q1 was a good quarter for TD. Earnings were $3.6 billion, and EPS was $2. Revenue grew 5% year-over-year, reflecting higher fee income in an improved macroeconomic environment for our markets-driven businesses, including the contribution from TD Cowen and higher volumes and deposit margins in Canadian personal and commercial banks. PCLs were hired due to continued consumer credit normalization and commercial credit migration in line with our prior guidance. While expenses were up 12% year-over-year, reflecting the inclusion of TD Cowen, expense growth moderated on a quarter-over-quarter basis. We made progress on our restructuring initiatives, delivering efficiencies across the enterprise, while continuing to prioritize investments in our risk and control infrastructure. The bank's CET1 ratio was 13.9%, reflecting organic capital generation offset by an increase in RWA from strong volume growth and the impact of almost 21 million common shares bought back during the quarter.

Speaker Change: You were was a good quarter what D D earnings with $3.6 billion in EPS was $2 revenue grew five per cent in your ear, reflecting higher fee income and an improved macroeconomic environment for our work is driven businesses, including the contribution from D. D Garland at Hot.

Speaker Change: [noise] volumes of deposit barges in Canadian personal lives commercial banking b.

Speaker Change: P C O two or higher due to continued consumer credit normalization and come out.

Speaker Change: She'll Grunted migration in line with our prior guidance well.

Speaker Change: Well expenses were up 12% year over year, reflecting the inclusion of did you go and expensive grow with the moderated or the quarter over quarter basis, we made progress in a restructuring initiatives delivering officials across the enterprise, while continuing to prioritize investments in a risk of the control infrastructure.

Speaker Change: The Bigs C. D. One ratio was 13.9%, reflecting organic capital generation upset, but increasing our W. A from strong volume growth.

Speaker Change: Back to almost 21 million common shares bought back during the quarter.

Bharat B. Masrani: In an uncertain market, TD remains well positioned, from both a capital and funding perspective, with the capacity to return capital to shareholders while supporting our customers and driving growth across our business. Last quarter, I highlighted TD Invest, the bank's enterprise approach to innovation. We have reached a milestone. As of this quarter, TD has over 700 patents across Canada and the U.S., and for the third consecutive year, TD was recognized by the Business Intelligence Group in its annual Innovation Awards, ranking highest in the organization and product categories for the TD Accessibility Adapter, a browser plug-in that helps make online experiences more inclusive.

Speaker Change: And an uncertain market, Judy roommates well position.

Speaker Change: From both of the capital and funding perspective, with the capacity to return capital to shareholders, while supporting our customers and driving growth across our businesses.

Speaker Change: Last quarter I highlighted did invent the bank's enterprise approach to innovation.

Speaker Change: We have reached that milestone as of this quarter G. D is over 700 buttons across Canada, and the U S and for the third consecutive year did he was recognized by the business Intelligence group and its annual innovation awards ranking highest in the organization and product categories for the D. D accessibility adapter.

Speaker Change: It browser plug it that helps make online experience is more inclusive.

Bharat B. Masrani: Let me now turn to each of our businesses and review some highlights from Q1. In our Canadian personal and commercial banking segment, earnings were $1.8 billion, up 3% year-over-year, and PTPP was $2.9 billion, up 6% year-over-year. However, expenses increased 6% year-over-year, reflecting higher employee-related spend and technology costs.

Speaker Change: Let me know to do each of our businesses and reviews some highlights from fjord.

Speaker Change: A Canadian personal and commercial banking segment earnings were $1.8 billion up three per cent. Your all your and P. T. P. B was $2.9 billion up six per cent. Your with your expenses increased 6% year over year, reflecting higher employee related spin and technology cause.

Bharat B. Masrani: We saw strong volume growth on both sides of the balance sheet while delivering another quarter of segment NIM expansion of six basis points quarter over quarter. In real estate secured lending, TD recorded its 8th consecutive month of market share gains, and personal deposits grew 3% quarter over quarter. In everyday banking, we saw strong advisor productivity and record customer acquisition, with new accounts up 19% year-over-year and another strong quarter for new-to-Canada accounts. In credit cards, we celebrated a 10-year milestone as the primary credit card issuer for Aeroplan, Canada's top airline loyalty program. Since TD Aeroplan Credit Cards were first issued in January 2014, we have delivered exceptional value to our customers, serving more than 1 million Canadians who together have earned over 300 billion points on their TD Aeroplan Credit Cards, enough to fly round trip from Toronto to Los Angeles three and a half million times.

Speaker Change: We saw a strong volume growth on both sides of the balance sheet, while delivering another order of segment NIM expansion of six basis points quarter over quarter.

Speaker Change: Real estate secured lending D. D recorded its eight consecutive month of market share gains and personal deposits grew three per cent order of a quarter.

Speaker Change: And everyday banking were so strong advisor productivity and record customer acquisition with new accounts up 19% year over here and another strong quarter or neutral kind of like.

Speaker Change: And credit cards, we celebrated a 10 year might as soon as the primary regretted God assure for Arrow Blood, Canada stop Airlines loyalty program.

Speaker Change: Since studio Blind credit cards were first issued in January 2014, we've delivered exceptional value to our customers serving more than 1 million Canadians, who together earn over 300 billion points or the DDR Oakland credit cards enough to fly round trip from Toronto to Los Angeles.

Speaker Change: Three and a half million times.

Bharat B. Masrani: At Business Banking, we grew loans by 8% year over year. Small Business Banking helped over 165,000 clients conveniently repay their SEBA loans, providing over 70,000 pre-approved refinancing offers and almost $600 million in loans. And we saw growth in TD Auto Finance, reflecting strong performance in prime retail auto lending and an accelerated acquisition of dealer relationships in our commercial business year over year. Turning to the U.S., U.S. retail bank earnings were $752 million, down 26% year-over-year, and PTPP was $1.1 billion, down 17% year-over-year. Revenue declined 6% year-over-year, reflecting lower deposit volumes and margins partially offset by higher loan volumes and fee income.

Speaker Change: And business banking, we grew loads like 8% year over year small business banking helped over 165000 clients conveniently repair their ciba loans, providing over 70000, preapproved refinancing offers and almost $600 million in loans.

Speaker Change: We saw grows into the auto finance, reflecting strong performers and Brian Reed the auto lending an accelerated acquisition of dealer relationships and a commercial business year over here.

Speaker Change: Turning to the U S U S retail make earnings what's the $152 million U S down 26% year over here and P. G. B B was 1.1 billion U S dollars down 17% a year earlier rather.

Speaker Change: Revenue declined 6% year over year, reflecting lower deposit volumes and margin, partially offset by higher loan volumes in fee income expenses increased 3% year over year, but declined two per cent order of a quarter.

Bharat B. Masrani: Expenses increased 3% year-over-year but declined 2% quarter-over-quarter as the bank's productivity initiatives helped offset higher employee-related costs and investments in business and controls initiatives. PCLs were higher compared to last year, with the increase reflected in both the consumer and commercial lending portfolio, with the contribution from our investment in Schwab of $144 million. Segment earnings were US$896 million.

Speaker Change: Banks productivity initiatives helps upset higher employee related costs and investments and business in control.

Speaker Change: Trolls initiatives B.

Speaker Change: P C elsewhere higher compared to last year with the increase reflected in both the consumer and commercial lending portfolios with the contribution from our investment and Schwab of 144 million you Ah.

Speaker Change: Segment earnings were 896 million U S dollars.

Bharat B. Masrani: The U.S. retail bank saw continued loan growth while maintaining its through-the-cycle underwriting standards. Loans were up 9% year-over-year, reflecting growth in mortgages, middle market, commercial lending, and TD's proprietary BankCard book. Quarter-over-quarter deposit balances, excluding sweeps, were flat, and NIM compressed four basis points as the bank delivered balance sheet stability in a challenging market. TD Bank, America's most convenient bank, is serving small business clients with innovative solutions. This quarter, we added Tap2Pay on iPhone, one of the first banks globally to launch this feature integrated within our mobile app.

Speaker Change: The U S retail banks are continued load growth, while maintaining his through the cycle underwriting standards.

Speaker Change: Those were up 9% year over year, reflecting rooted mortgages middle market.

Speaker Change: She'll lending and tedious proprietary Bank Guard book.

Speaker Change: Order of a quarter of deposit balances, excluding sweeps were flat and them compressed four basis points is the big delivered balance sheets stability in a challenging market.

Speaker Change: T D bank of America's most convenient being is serving small business loans with innovative solutions. This quarter, we added tap to pay on iPhone one of the first wings globally. The lunch with this feature integrated within our mobile lab. We also enable zelle four small business enhancing convenience and functionality.

Bharat B. Masrani: We also enabled Zelle for small business, enhancing convenience and functionality through near real-time payment capability. And last month, TD Bank, America's most convenient bank, announced a three-year community impact plan that will provide an estimated 20 billion U.S. dollars to support lending, philanthropy, banking access, and other activities for diverse and underserved communities across our U.S. food. The Wealth Management Insurance segment earned $555 million The business earned through higher insurance service expenses, with revenues up 8% year-over-year, reflecting insurance premium growth and higher fee-based revenue in the Asset Management and Advice-Based Businesses. This month, TD Direct Investing was ranked as the number one direct investing brokerage in Canada by the Globe and Mail for the second consecutive year.

Speaker Change: Through through near real time payment capabilities.

And last month T D Bank of America's most convenient bank announced a three year community impact plan that would provide an estimated 20 billion U S dollars supporting lending philanthropy banking axes, and other activities for divers in underserved communities across our U S footprint.

Speaker Change: The wealth management and children's segment earned $555 million this quarter flat you over here.

Speaker Change: Business earned through hired insurance service expenses with revenues up 8% year over year, reflecting insurance premium growth and higher fee based revenue in the asset management and advice based businesses.

Speaker Change: This month Didi directly investing was ranked as the number one directly investing brokerage in Canada by the global mail for the second consecutive year.

Speaker Change: And we have now onboard or more than half of our eligible active trading clients.

Bharat B. Masrani: And we have now onboarded more than half of our eligible active trading clients onto TD ActiveTrader, the bank's completely redesigned platform for sophisticated active traders. We had a strong start to the year in TD Asset Management with several large institutional mandates across multiple geographies won and funded. And we were proud that several TDAM managed funds were recognized with 2023 Fund Grade A-plus awards by FundData, reflecting strong risk-adjusted performance relative to industry peers.

Speaker Change: I'll do T D active traders the bags completely redesigned platform for sophisticated active traders.

Speaker Change: We had a strong so I started to do the you're in D. D asset management with several large institutional mandates across multiple geographies, one and funded.

Speaker Change: And we were proud that several DRAM managed funds would recognize with 20 twenty-three fun, great a plus awards by fun data, reflecting strong risk adjusted performance relative to industry beers.

Bharat B. Masrani: Finally, in TD Insurance, we continue to build on our digital leadership as Canada's number one direct insurer, with one in three customers now buying their insurance online from end-to-end. Wholesale banking delivered record revenues, driven by the segment's expanded capabilities coupled with improved market conditions. We are gaining market share across U.S. M&A and equity capital markets as we leverage the power of TD Collins. Expenses this quarter included a $102 million provision relating to the industry-wide U.S. record-keeping matter. Excluding this item, net income was $400 million, up 15% year-over-year.

Finally did insurance, we continue to build on a digital leadership as Canada is a number one direct insurer with one in three customers now buying their insurance online from into it.

Speaker Change: Wholesale banking delivered record revenues driven by the segments expanded capabilities, coupled with improved market conditions.

We're gaining market share across U S M&A and equity capital markets as we leverage the power of T D Cawood <unk>.

Speaker Change: Expenses. This quarter included 102 million dollar provision relating to the industry wide U S record keeping matter.

Speaker Change: Excluding this item net income was $400 million up 15% year over here.

Bharat B. Masrani: We are executing on one TD opportunity. This quarter, TD Securities and TD Wealth enabled fully paid lending to enhance returns for their wealth clients. And in partnership with TD Bank, America's most convenient bank, we began to issue equity-linked certificates of deposit, broadening the suite of products available to clients in the U.S. TD Securities also continued to demonstrate its leadership in ESG, acting as joint lead manager on TD's $500 million U.S. Sustainable Bond Offering, the International Finance Corporation's $1.5 billion Social Benchmark Offering supporting low-income communities in emerging markets, and KFW's $1.5 billion Australian Green Bond, the issuer's largest-ever transaction in the Australian market.

Speaker Change: We're executing on one DVD opportunities this quarter D. D security is a D. D world enables fully paid lending to enhance returns with wealth lines.

Speaker Change: And in partnership with D. D Bank of America is most convenient Bang we began to issue equity links the difficulties of deposit broadening the suite of products available declines in the U S.

Speaker Change: Did your security is also continued to demonstrated leadership and E. S. G acting as a joint lead manager or D. D. As 500 million U S dollars sustainable bond offering International Finance Corporation is one and a half billion dollars social benchmark offering supporting low income communities in emerging markets.

Speaker Change: And K F. W 1.5 billion Australian dollars Greenberg the issue is the largest ever transaction and the Australian market.

Bharat B. Masrani: Guided by our purpose, TD is committed to creating value for all of our stakeholders. I'm proud that the bank was listed on the Dow Jones Sustainability Index North America Index for the 12th consecutive year. TD was also recently named a 2024 S&P Global Sustainability Yearbook Member, awarded to banks in the top 15% of S&P's corporate sustainability assessment worldwide. Last month, the TD Charitable Foundation launched its 18th annual Housing for Everyone grant competition.

Speaker Change: Guided by our purpose did is committed to creating value for all of our stakeholders I'm proud that the bank was listed in the Dow Jones Sustainability Index, North America index for the 12th consecutive year D.

Speaker Change: D. D was also recently named it 2024, SNB global sustainability yearbook member awarded to banks in the top 15% of S&P's corporate sustainability assessment worldwide.

Speaker Change: Last month the T.

Speaker Change: D D charitable foundation launch its 18th annual housing for everyone Grand competition the gum.

Bharat B. Masrani: The competition will focus on organizations in the U.S. providing services to support independent living for marginalized community members, including rapid rehousing and permanent supportive housing or transitional housing. And in a few weeks, TD will release its 2023 Sustainability Reporting Suite, including our Climate Action Plan. We are excited to share the progress enabled by dedicated colleagues across the bank who have transformed our aspirations into action. It is a privilege to work alongside our TD bankers every day. I would like to thank them for all they do to deliver for our shareholders and to make TD a better bank. With that, I'll turn things over to Kelvin. Thank you, Bharat, and good morning, everyone.

Speaker Change: But this one with a focus on organizations in the U S providing services to support independent living for modulators community members, including rapid Rehousing and permanent supportive housing or transitional housing.

Speaker Change: And in a few weeks did they will release its 20 twenty-three sustainability reporting sweet, including a climate action plan.

Speaker Change: [noise] excited to share the progress enable by dedicated colleagues across the bank will transform our explorations into action.

Speaker Change: It is a privilege to work alongside a D. D man cause every day I would like to thank them for all their due to deliver for our shareholders and to make D. D. The better Bang with that I'll turn things over to tell them.

Speaker Change: Thank you Barrett and good morning, everyone. Please turn to slide 10.

Kelvin Vi Tran: Please turn to slide 10. This quarter, revenue increased year-over-year, driven by higher fee income in our market-driven businesses and higher volumes in Canadian and personal commercial banks. Expenses, reflecting the inclusion of TD Cowen, also increased year-over-year, reflecting higher employee-related expenses. However, we moderated expense growth on a quarter-over-quarter basis and made progress on our restructuring initiatives and reprioritized our investment. ECLs were higher due to continued consumer credit normalization and commercial credit migration. As a result, earnings were $3.6 billion, and EPS was $2, down 12% and 10% year-over-year, respectively.

Speaker Change: This quarter revenue increase year over year, driven by higher fee income and our market driven businesses and higher volumes and Canadian and personal commercial banking.

Tellman: Expenses, reflecting the inclusion of T. D. Cowan also increase year over year, reflecting heart employee related expenses.

Tellman: <unk> moderator expense growth on a quarter over quarter basis, and made progress on a restructuring initiatives and re prioritize our investment.

Tellman: <unk> or higher due to continued consumer credit normalization and commercial credits migration.

Tellman: As a result.

Tellman: Earnings were $3.6 billion in EPS was $2 down, 12% and 10% year over year, respectively.

Kelvin Vi Tran: This quarter, we had a six cent impact from a provision related to the industry-wide U.S. recordkeeping. We also adopted IFRS 17 this quarter. On slide 26, you will see that we have updated our presentation of PTPP to show revenues net of insurance services. Please turn to slide 11.

Tellman: This quarter, we had a <unk> impact from a provision related to the industrywide U S record keeping matter.

Tellman: We also adopted Ifr 17 this quarter.

On Slide 26, you will see that we have updated our presentation of P. T. P. P to show revenues net of insurance service expensive.

Tellman: Please turn to slide 11.

Kelvin Vi Tran: As I said on our Q4 2023 earnings call, in fiscal 2024, we expect run rate expenses, inclusive of the savings generated by the restructuring program and investments to accelerate future growth, to increase by approximately 2% year-over-year. For Fiscal 2024, we expect adjusted expense growth in the mid-single digits reflecting investments in our risk and control infrastructure and the impact of. This quarter, we incurred a restructuring charge of $291 million pre-tax. We continue to expect to incur restructuring charges in the first half of calendar 2024 that are of similar magnitude to the restructuring charges incurred in the fourth quarter. As I noted last quarter, the restructuring program is expected to generate savings of approximately $400 million pre-tax in fiscal 2024 and annual run rate savings of approximately $600 million. Cost savings will be driven by a 3% FTE reduction, real estate optimization, and asset impairments as we accelerate transitions to new platforms. This will create capacity to re-enact.

Tellman: As I sat on our queue for two 2000 twenty-three earnings call and first call 2024, we expect run rate expenses inclusive of the savings generated by the restructuring program and investments to accelerate future growth to increase by approximately 2% year over year.

Tellman: For fiscal 2024, we expect adjuster expense growth in the mid single digits, reflecting investments and our risk and control infrastructure and the impact of T. D Cawood.

Tellman: This quarter, we incurred a restructuring charge of $291 million pretax we continue to expect to incur restructuring charges in the first half of calendar 2024 that are of similar magnitude to the restructuring charges incurred in the fourth quarter of 2023.

Tellman: As I noted last quarter. The restructuring program is expected to generate savings of approximately $400 million pretax in fiscal 2024, an annual run rate savings of approximately $600 million pretax.

Tellman: Cost savings will be driven by a three per cent FTE reduction real estate optimization, an asset impairments as we accelerate transitions to new platform.

Tellman: This will create capacity to reinvest.

Kelvin Vi Tran: We are on track to deliver our FTE reduction target and targeted fiscal 2024 and annualized, Please turn to slide 12. Canadian personal and commercial banking delivers a strong quarter reflecting volume growth and margin expansion. Average loan volumes rose 7% year-over-year, with 7% growth in personal volumes, joined by real estate secured lending up 6% and cards up 11%, and 8% growth in business.

Tellman: We are on track to deliver our FTE reduction target and target at fiscal 2024, an annualized savings. Please.

Tellman: Please turn to slide 12.

An alien personal and commercial banking deliver a strong quarter, reflecting volume growth and margin expansion.

Average loan volumes rose, 7% year over year with.

Tellman: With 7% growth and personal volumes, driven by real estate lending up, 6% and cards up 11% and 8% growth and business volumes.

Kelvin Vi Tran: Average deposits rose 3% year-over-year, reflecting 6% growth in personal deposits partially offset by a 2% decline in business deposits as small business banking customers drew down on balances to repay their loans. Net interest margin was 2.84%, up six basis points, quarter over quarter, primarily due to higher deposit margin. As we look forward to Q2, while many factors can impact margins, including tractor on and off rates and balance sheet mix, we expect NIM to remain relatively stable, with expenses increasing reflecting higher spend supporting business growth, including employee-related expenses and technology. Please turn to slide 13.

Tellman: Average deposits rose, 3% year over year, reflecting 6% growth and personal deposits, partially offset by 2% decline in business deposits are small business banking customers drew down on balances to repay their ciba at all.

Tellman: Net interest margin was two point 84 per cent.

Tellman: Up six basis point quarter over quarter, primarily due to higher deposit margin.

Tellman: As we look forward to cue to while many factors can impact margins, including tractor on and off rates and balance sheet makes we expect them to remain relatively stable.

Tellman: Expenses increased reflecting higher spent supporting business growth, including employee related expenses and technology call. Please turn to slide 13.

Tellman: The U S retail bank deliver a strong known growth and operating momentum and a challenging environment.

Kelvin Vi Tran: U.S. Retail Bank delivers strong loan growth and operating momentum in a challenging environment. Average loan volumes increased 9% year-over-year, with personal loans increasing, reflecting lower mortgage repayments in the higher rate environment.

Tellman: Average loan volumes increased 9% a year over year.

Tellman: Personal loans increase reflecting lower mortgage repayments in the higher rate environment strong auto originations and double digit growth in T. DS proprietary bankcard book.

Kelvin Vi Tran: Strong Auto Originations and Double-Digit Growth in TD's Proprietary Bank Card, Business Loans Increase Reflecting Good Originations from New Customer Growth and Slower Payments, Average deposit volumes excluding sweep deposits were down 2% year-over-year and flat quarter-over-quarter as the U.S. retail bank demonstrated deposit resilience in competitive market conditions. Net Interest Margin was 3.03%, down 4 basis points quarter over quarter due to lower deposits, with the cost partially offset by the benefit of higher reinvestment. As we look forward to Q2, while many factors can impact margins, including competitive deposit market dynamics in the U.S., tractor on and off rates, and balance sheet mix, we expect NIM to be relatively stable in the near term, influenced by similar drivers as those we saw this year. Expenses increase year-over-year, reflecting higher employee-related expenses, but decline quarter-over-quarter as productivity initiatives help offset higher employee-related costs and investments in business and control initiatives.

Tellman: Business loans increase reflecting good originations from new customer growth and slower payment rates.

Tellman: Average deposit volumes, excluding sweep deposits, we're down 2% year over year and flat quarter over quarter as a U S retail bank demonstrated deposit relate resilience and competitive market conditions.

Tellman: Net interest margin was 3.3% down for basis point quarter over quarter due to lower the policy.

Tellman: But cost partially offset by the benefit of higher reimbursement rates.

Tellman: As we look forward to a Q2, while manufacturers can impact margins, including competitive deposit market dynamics in the U S trapped her on and off rates and balance sheet mix, we expect them to be relatively stable in the near term influenced by similar drivers ourselves we solve this quarter.

Tellman: Expenses increase year over year, reflecting higher employee related expenses, but declined quarter over quarter as productivity initiatives help offset heart employee related costs and investments and business and control initiatives. Please turn to slide 14.

Tellman: As I mentioned the bank adopted Arafat 17. This quarter. We appreciate the analysts and investors may have questions on the financials and presentation impacts of this change.

Tellman: We have added slide 35 to this presentation to assist in this regard.

Tellman: Fiscal 2023 results have been restated to reflect this new standard.

Kelvin Vi Tran: Please turn to slide 14. As I mentioned, the bank adopted RFR 17 this quarter. We appreciate that analysts and investors may have questions on the financial and presentation impacts of this change. We have added slide 35 to this presentation to assist in this regard. Fiscal 2023 results have been restated to reflect this new accounting standard. Wealth Management and Insurance delivered good performance this quarter, reflecting the strength of the segment's diversified business. Net income was flat year-over-year as higher revenue was offset by higher insurance service expenses and non-interest expenses reflecting higher variable compensation commensurate with higher revenue.

Tellman: Wealth management and insurance delivered good performance quarter, reflecting the strength of the statements diversified business.

Tellman: Net income was flat year over year of higher revenue was offset by higher insurance service expenses and non interest expense is reflecting higher variable compensation commensurate with higher revenues.

Tellman: Like peers across the industry, we have seen deposit flow into GIC and other products in the high rate environment.

Tellman: That trend has begun to moderate.

Tellman: We're also executing upon initiatives to help ensure T D retains backflow in-house and captures flows from other institutions.

Tellman: Assets under management increase year over year, reflecting market appreciation and assets under administration increase year over year, reflecting market appreciation and an asset growth.

Kelvin Vi Tran: Like peers across the industry, we have seen positive flows into GIC and other products in the high rate environment. That trend has begun tomorrow, We are also executing initiatives to help ensure TD retains that flow in-house and captures flows from other sources. Assets under management increase year-over-year, reflecting market appreciation, and assets under administration increase year-over-year, reflecting market appreciation and net assets. Please turn to slide 15. Postal Banking Delivered Record Revenue. Net income for the quarter was $298 million, down 14% year-over-year.

Tellman: Please turn to slide 15.

Tellman: Wholesale banking delivered record revenue.

Tellman: Net income for the quarter was $298 million down 14% year over year.

Tellman: Excluding the impact of the $102 million provision related to the industrywide U S record keeping manner net income was $400 million up 15% year over year.

Revenue, including TD Cowan was $1.8 billion up 32% year over year, primarily reflecting higher equity commissions learning revenue, primarily from syndicated and leveraged finance.

Kelvin Vi Tran: Excluding the impact of the $102 million provision related to the industry-wide U.S. record-keeping matter, net income was $400 million, up 15% year-over-year. Revenue, including TD Cowen, was $1.8 billion, up 32% year-over-year. primarily reflecting high equity commissions, lending revenue, primarily from syndicated and leveraged finance, underwriting fees, and trading-related revenue. Expenses increased 60% year-over-year, reflecting the provision I mentioned, as well as higher variable compensation commensurate with higher revenue. Excluding this provision, expenses increased 49% year-over-year, reflecting the inclusion of TD Cowen, which closed March 1st last year. Please turn to slide 6. The corporate net loss for the quarter was $218 million, compared with a net loss of $140 million in the first quarter last year.

Tellman: Writing fees and trading related revenue.

Tellman: Expenses increased 60% year over year, reflecting the provision I mentioned as well as higher verbal compensation commensurate with high revenue <unk>.

Tellman: Excluding this provision expenses increased 49% year over year, reflecting the inclusion of T D Cowan, which closed March 1st last year.

Tellman: Please turn to slide 16.

Tellman: The corporate net loss for the quarter was $218 million compared with a net loss of $140 million in the first quarter last year.

Tellman: Net corporate expenses increased $63 million compared to the prior year, mainly reflecting investments in our risk and control infrastructure.

Tellman: Turn to slide 17.

Tellman: The common equity tier one ratio ended the quarter at 13.9% down 49 basis points sequentially.

Tellman: Internal capital generation was offset by an increase in our W. A excluding the impact of effects, primarily reflecting volume growth.

Kelvin Vi Tran: Net corporate expenses increased $63 million compared to the prior year, mainly reflecting investments in our risk and control infrastructure. Please turn to slide 7. The Common Equity Tier 1 ratio ended the quarter at 13.9%, down 49 basis points sequentially. Internal capital generation was offset by an increase in RWA, excluding the impact of FX, primarily reflecting volume growth. We continued our NCIB this quarter and have now completed almost 50% of our 90 million share buyback program. Regulatory changes, which included a fundamental review of the trading book and negatively amortizing mortgages, decreased CT1 by 17 basis points this quarter, primarily reflecting an increase in market price. With that, Ajai, over to you.

Tellman: We continued our N civ this quarter and have now completed almost 50% of our 90 million share buyback program.

Tellman: Regulatory changes, which included the fundamental review of the trading book and.

Tellman: And negatively amortizing mortgages decrease setiawan by 17 basis point this quarter, primarily reflecting an increase in Martin.

Without arguing over to you.

Tellman: Thank you Kelvin and good morning, everyone. Please turn to slide 18.

Kelvin: Grass and bad loan formations increased by four basis points quarter over quarter to 22 basis points driven by the Canadian commercial lending portfolio largely related to one file in the automotive industry and continued normalization of Craig.

Ajai Bambawale: Okay, thank you, Kelvin. And good morning, everyone. Please turn to slide 18. Gross Impaired Loan Formations increased by four basis points, quarter over quarter to 22 basis points, driven by the Canadian Commercial Lending Portfolio, largely related to one file in the automotive industry, and continued normalization of credit performance in the Consumer Lending Portfolio, including some impact of seasonal trends in the U.S. cards and auto portfolio. Please turn to slide 19.

Kelvin: Performance in the consumer lending portfolios.

Kelvin: Including some impact of seasonal trends in the U S guards and order portfolios.

Please turn to slide 19.

Kelvin: Ross impaired loans increased four basis points quarter over quarter to 40 basis points driven by the.

Kelvin: The commercial and consumer lending portfolios, partially offset by a reduction in wholesale banking.

Kelvin: Please turn to slide 20.

Ajai Bambawale: Gross impaired loans increased four basis points quarter over quarter to 40 basis points, driven by Commercial and Consumer Lending Portfolios Partially Offset by a Reduction in Wholesale Banking. Please turn to slide 20.

Kelvin: Recall that our presentation reports beefier ratios boot grass and net of the partners share of the U S strategic God Bcl's, we remind you that the U S. Codpiece shows recorded in the corporate segment.

Ajai Bambawale: Recall that our presentation reports PCL ratios both gross and net of the partner share of the U.S. Strategic Card PCL. We remind you that U.S. card PCLs recorded in the corporate segment are fully absorbed by our partners and do not impact the bank's net income. Bank's provision for credit losses increased 5 basis points quota over quota to 44 basis points. The increase is largely recorded in the U.S. retail, corporate, and Canadian personal and commercial banking sectors. Please turn to slide 21. The bank's impaired PCL was $934 million, an increase of $215 million quarter-over-quarter, largely related to continued credit normalization in the consumer lending portfolios, including some seasonal impact in the U.S. cards and orders portfolio and credit migration in the commercial lending portfolios across various industries. Performing PCL decreased 92 million quarter over quarter to 67 million.

Kelvin: Fully absorbed by our partners and do not impact the bank's net income.

Kelvin: The banks provision for credit losses increased five basis points quarter over quarter to 44 basis points. The increase is largely recorded in the U S retail corporate and Canadian personal and commercial banking segments.

Kelvin: Please turn to slide 21.

Kelvin: The banks impaired PCL was $934 million, an increase of 215 million quarter over quarter largely related to continue credit normalization in the consumer lending portfolios, including some seasonal impact in the U S cause.

Kelvin: An order portfolios and credit migration in the commercial lending portfolios across various industries.

Kelvin: Performing PCL decrees 92 million quarter over quarter to 67 million.

Ajai Bambawale: Current quarter performing provisions were largely recorded in the Canadian personal and commercial banking sector. Please turn to slide 22. The allowance for credit losses increased by 79 million quarter over quarter to 8.3 billion.

Kelvin: Current quarter performing provisions were largely recorded in the Canadian personal and commercial banking segment.

Kelvin: Please turn to slide 22.

Kelvin: The allowance for credit losses increased by 79 million quarter over quarter to 8.3 billion.

Ajai Bambawale: Due to current credit conditions, including some credit migration across the lending portfolio and volume growth, partially offset by a $122 million impact from foreign exchange, the bank's allowance coverage remains elevated to account for ongoing uncertainty relating to the economic trajectory and credit performance. Before I conclude, I will make a few additional comments about the loan portfolio. Key credit metrics in our consumer lending portfolios are now broadly at pre-pandemic levels as rising unemployment and elevated interest rates have presented challenging conditions for consumers. Notwithstanding current conditions, performance of our Canadian RESL portfolio reflects its strong underlying credit quality, as impaired PCLs remain at less than one basis, and we see continued reductions in the negatively amortizing population moving to non-retail. The wholesale segment continued to perform well, with no new impairments over the Canadian and U.S. commercial gross impaired loans and PCLs have risen over the past year from cyclically low levels.

Kelvin: Due to current credit conditions, including some credit migration across the lending portfolio and volume growth.

Kelvin: Partially offset by at 122 million and back from foreign exchange.

Kelvin: The banks allowance coverage remains elevated to account for ongoing uncertainty relating to the economic trajectory and credit performance.

Kelvin: Before I conclude I will make a few additional comments about the loan portfolio.

Kelvin: He credit metrics in a consumer lending portfolios.

Now broadly at pre pandemic levels as rising unemployment and elevated interest rates have presented challenging conditions for consumers.

Kelvin: Notwithstanding current conditions performance of a Canadian resolute portfolio reflects its strong underlying credit quality.

Kelvin: As in bad Bcl's remain at less than one basis point and we see continued reductions in the negatively amortizing population.

Kelvin: Moving to Nonretail.

Kelvin: The wholesale segment continued to perform well with no new impairments over the past two quarters.

<unk> and U S commercial gross and bad loans and Pcl's have risen over the past year from cyclically low levels consistent with the economic trajectory.

Ajai Bambawale: Consistent with the Economic Trajectory. Pressure on the commercial real estate office segment is expected to persist, and we continue to bolster our reserves as appropriate. The bank's exposure to the office segment remains small.

Kelvin: Pressure on the commercial real estate office segment is expected to persist and we continue to bolster our reserves as appropriate.

Kelvin: Banks exposure to the office segment.

Kelvin: Remain small.

Unknown Executive: To conclude, Bank exhibited good credit performance this quarter with PCLs in line with our prior guidance. Looking forward, I continue to expect PCLs for fiscal 2024 to be in a range of 40 to 50 basis points. Although results may vary by quarter and are subject to changes in economic conditions, with that operator, we are now ready to begin the Q&A session. Thank you. We will now take questions from the telephone line. If you have a question, please press star 1 on the device's keypad. You may cancel your question at any time by pressing star 2.

Speaker Change: To conclude.

Speaker Change: The bank exhibited good credit performance this quarter with Bcl's in line without prior guidance.

Speaker Change: Looking forward.

Speaker Change: I continued to expect Bcl's for fiscal 2024 to be in a range of 40 to 50 basis points. Although results may vary by quarter and are subject to changes in economic conditions.

Speaker Change: With that operator, we are now ready to begin the Q&A session.

Speaker Change: Thank you.

Speaker Change: We will now take questions from the telephone lines.

Speaker Change: You have a question please press star one on.

Speaker Change: The devices keypad.

Speaker Change: You may cancel your question at any time by pressing started too. So please press star one.

Unknown Executive: So please press star 1 at this time if you have a question. There will be a brief pause while the participants, Thank you for your patience. The first question is from Ebrahim Poonawala from Bank of America. Please go ahead, your line is open. Good morning. I guess, maybe just.

Speaker Change: This time, if you have a question there will be a brief pause and all the participants register.

Speaker Change: Thank you for your patience.

Speaker Change: First question is from you by him Maputo Walla from Bank of America. Please go ahead with your line is open.

Leo Salom: Yeah good morning.

Leo Salom: I guess, maybe just.

Leo Salom: For you.

Bharat B. Masrani: Bharat, for you, there's an unhealthy amount of speculation around how long you'll be in your seat and if there's a CEO succession waiting to happen at TD. I appreciate it's the board's decision, but given everything that's going on with dealing with the AML issues and the change in leadership in Canada, it has been unsettling for investors from the outside to get confidence that execution at the top is consistent and moving in the right direction. So to the extent you can adjust things like how long you want to be in the seat and how we should think about it, that would be really helpful.

Leo Salom: As an unhealthy amount of speculation around how long you'll be in your seat and instead of C. A succession waiting to happen to T D.

Speaker Change: I appreciate the board's decision.

Speaker Change: Given everything that's going on with dealing with the email issues change in leadership in Canada. It has been unsettling for investors from the outside to get confidence that.

Speaker Change: Execution at the top is consistent and moving in the right direction. So to the extent you can address like how long do you want to be in the seat and how we should think about it that would be really helpful.

Bharat B. Masrani: Ebrahim, nice to hear your voice and good morning to you. I've read some of these reports and, of course, speculation. What I can tell you is I'm really focused on strengthening the bank, serving our customers, and creating value for our shareholders. We have a deep and highly experienced bench of senior leaders, including those on the call with me this morning.

Speaker Change: Hey, Brian Nice to hear your voice and good morning to you.

Brian Reed: I've read some of these reports and and of course speculation what I can tell you is I'm really focused on strengthening the bank.

Speaker Change: Serving a customer the engraving value for our shareholders.

Speaker Change: We have a deep and highly experienced bench of senior leaders, including those on the call with me. This morning, and hopefully menu. If you can see these did this team is delivered and a great momentum and all of our businesses look at Canadian PNC, you know U S business notwithstanding some of the challenges there no D.

Bharat B. Masrani: And hopefully, many of you can see this team has delivered, you know, great momentum in all of our businesses. Look at Canadian P&C, you know, our U.S. business, notwithstanding some of the challenges there. You know, T.D.

Bharat B. Masrani: Cowan is hitting on all cylinders. And so I'm very happy as to how the team is delivering. And we've talked about this before, as you would expect, you know, we have very detailed and robust succession plans across the bank. So hopefully, that answers your question, and I appreciate the query, and you want to run this bank for many years to come. Did I hear that?

Speaker Change: D D Cohen hitting on all cylinders and so I'm very happy as to how the team is delivering and we've talked about this before as you would expect you know we are very detail and robust succession plans across the bank.

Speaker Change: So hopefully you know the answer to your question and I appreciate the query.

Speaker Change: And you wanted to run this thing for you to come to you that [laughter].

Bharat B. Masrani: That every day I wake up, I'm focused on strengthening the bank and serving our customers, of course, is a top priority, as is creating value for our shareholders. And hopefully, I'm doing that. And just a separate question in terms of the AML issue, not about the specifics, but what happened there?

Speaker Change: [laughter] cause then I can focus everyday I wake up I'm focussed on strengthening the bank and.

Speaker Change: Serving our customers of course of the top priority as is creating value for our shareholders and hopefully I'm doing that.

Speaker Change: And just a separate question in terms of the email if you are not about the specifics, but what happened there again for for.

Bharat B. Masrani: Again, for those of us who have followed TD for a long time, it's the assumption that TD is always ahead of the curve in terms of management, risk controls, and investments. What do you think happened there? And does that cause you to kind of reevaluate the rest of the bank, if there are any other issues that could emerge? You know, Ebrahim, as you know, I can't talk more about the specific issue. But what I can tell you, what I can tell you is that we know what the issue is, and we are working very hard to fix it. And it will get fixed.

Speaker Change: For those of US who followed D D for a long time.

Speaker Change: The assumption all the Tv's ahead of the curve in terms of management controls investments. What do you think happened there and does that cause you to kind of reevaluate the rest of the bank is there any other issues that emerge.

Speaker Change: You know I just had it but.

Speaker Change: As you know you know I can't talk more about the specific issue, but I can tell you what I can tell you is we know what the issue is we are working very hard to fix it and it will get fixed and you know when I'm in a position to give you more information I'd be happy to do that as far as a controlling interest.

Bharat B. Masrani: And you know, when I'm in a position to give you more information, I'd be happy to do that. As far as our control infrastructure, you know, we, This is an ongoing situation for TD or any company. Big Bank and the environment change, and as we hear improvements from others, including our regulators, about what the industry is doing, we want to keep up with it and, where appropriate, be ahead of it. So it's an ongoing process, and I'm happy to know how we are making progress. Thank you for taking my questions.

Speaker Change: Sure you know we.

Speaker Change: This is an ongoing situation for four T D or any you know.

Speaker Change: Big Bank in the environment changes and as we hear improvements Ah from others, including you know our regulators will the industry is doing you know we want to.

Speaker Change: Keep up with it and where appropriate to be ahead of it. So it's an ongoing process and I'm happy as do you know, how we are making progress.

Speaker Change: Alright, Thank you for taking my questions you.

Bharat B. Masrani: Thank you. The next question is from Gabriel Dechaine from National Bank Financial. Please go ahead; your line is open.

Speaker Change: Thank you.

Speaker Change: The next question is from Gabriel design from National Bank Financial. Please go ahead.

Gabriel: Good morning quick one.

Unknown Executive: Good morning. Quick one for Bharat. 20 million shares were purchased. You're still committed to the full 90 percent amount under the current program? Well, as we announced when we launched the program, our intention is to complete the program within the timeline we set out. And, you know, with market conditions permitting, we will continue to execute against the program. Okay, perfect. And next question for Mr. Wiggan.

Gabriel: Barrett 20 million insurance reproaches tears still committed to the full 90 amount under the current program.

Gabriel: As we announced when we launched the program or intention is to complete the program within the timeline, we said set out and you know with market conditions permit we will continue to do to execute against that program.

Gabriel: Perfect in next question for Mister Reagan.

Tim Wiggan: On the insurance, well, wealth earnings were flat year over year, market related, I guess, but also insurance flat. Just wondering about one of the issues PNC insurance in particular is facing is auto theft. And, you know, it's just a problem that keeps getting worse. How are you?

Auto insurance well wealth earnings were flat year over your market really move I guess, but also insurance flat.

Speaker Change: Just wondering.

Unknown Executive: About the you know one of the issues P&C insurance in particular is facing is auto theft and you know it's just a problem of keeps getting worse. How are you how have you been reflecting that near pricing and.

Tim Wiggan: How have you been reflecting that in your pricing? And do you need to do more? Thanks. Thank you for the question. So I think if you look at gross written premiums, obviously, we don't break down volume versus premium increases, but a healthy number overall on the GNI side, a 15% increase. As you've mentioned, we now have insurance service expense, which was up 17% in the quarter. And as you know, that includes claims along with maintenance and acquisition.

Speaker Change: Do you need me to do more thanks. Thank you for the question. So I think if you look at growth threatened premiums. We obviously, we don't break down volume versus a premium increases, but a healthy number overall on the G and I sighed, a 15% increase.

Speaker Change: As you have mentioned, we now have the insurance service expense, which was up 17% in the quarter and as you know that includes claims along with maintenance and an acquisition Ah. So auto theft is a is a major issue in Canada, we had the the National Forum on.

Tim Wiggan: We had the National Forum on February 8th. So when you look at claims, it's also claim severity. So to answer your question, we have a number of programs to address this. But the main one that I would focus on is what we call our tag program, where we're actually putting tags inside of automobiles, so similar to what you see with an apple pod, except that they're randomly placed.

Speaker Change: February the eighth so when you look at claims. It's also claims severity. So to answer your question. We have a number of programs to address this but the main one that I would focus you on is what we call our tag program, where we're actually putting tags inside of automobiles are so similar to to.

Speaker Change: You see with an Apple products that are the randomly placed and what we found is that those cars are are often is you know a place somewhere.

Tim Wiggan: And what we found is that those cars are often, as you know, placed somewhere and the criminals come back later. This program allows you to actually track the car and return the car. So our success rate in returning cars is about 95%. So we're very focused on that. And then I would say if you look at more normal claims-related issues on the auto side, we have 25 TD insurance auto centers where you can not only get your car fixed but rent a vehicle. And in addition, we have eight partnerships where we have priority placement in the queue, if you will, to get your car serviced. So when we have theft, we're aiming to return the car faster; when you have more regular damage, we're aiming to, again, return the car faster and lower rental rates.

Speaker Change: And the criminals come back later this program Ah allows you to actually track the car and return the car. So our success and returning cars is about 95 per cent.

Speaker Change: So we're very focused on that and then I would say if you look at a more normal claims related issues on the auto side, we have 25 Ah TD insurance Autocentres, where you can not only get your car fixed but rent a vehicle and in addition, we have eight a partnership where we have Ah prior.

Speaker Change: Already placement in the queue. If you will to get your car serviced so when we have Ah theft, we're aiming to return the car faster.

Speaker Change: When you have more regular damage or aiming to again return the car faster and lower rental rates. So it's a major focus for us perfect. Thanks, and well enjoy the rest of the week.

Tim Wiggan: So it's a major focus for us. Perfect. Thanks. And, well, enjoy the rest of the week, everyone.

Speaker Change: [noise]. The next question is from Paul holding CIBC. Please go ahead. Your line is open.

Unknown Executive: The next question is from Paul Holden from CIBC. Please go ahead; your line is open. Thank you. Good morning.

Unknown Executive: I want to ask a question about the US banking business. You reported an adjusted ROE this quarter of a little over 11. I think if I attribute some of the investments you're making to risk and control to that segment rather than corporate, then maybe it pushes the number down closer to 10. But anyway, the question is, 10 is clearly below where you'd like it to be. Where do you think this business can get to in terms of ROE over time? And what is required to get it back to an acceptable return?

Paul: Thank you good morning Wanna ask a question on the U S banking business.

Paul: You reported and adjusted or are we this quarter of a little over 11, I think if I attribute someone investments are making to risk can control to that segment rather than corporate then maybe it pushes the number down closer to 10.

Paul: But anyway. The question is 10 is clearly below where you would like it to be.

Paul: Where do you think this business can get too in terms of our we overtime.

Paul: And what is required to get it back to an acceptable return.

Leo Salom: Paul, thank you very much for the question. Let me just explain a little bit. Obviously, the macro environment in the U.S. is quite challenging.

Speaker Change: Paul. Thank you very much of a question let me, let me just frame a little bit obviously, the macro environment in the U S. A is quite challenging you saw some of that in the in the financial this quarter, but if you look forward. There's a number of things that I I draw a great deal of comfort from one we are carrying a tremendous amount of operating momentum.

Leo Salom: You saw some of that in the financials this quarter. But if you look forward, there's a number of things that I draw a great deal of comfort from. One, we are carrying a tremendous amount of operating momentum. You saw that in our loan growth, both in our retail and commercial loan portfolios. Retail was up 11 percent.

Speaker Change: You saw that in our loan growth both in our in our retail and commercial loan portfolios retail was up 11% commercial was up seven and if you look underneath it we really did execute on a number of our strategic priority. So we're we're carrying that momentum likewise as as Kelvin described I think we're seeing margins stability in the short term.

Leo Salom: Commercial was up 7. And if you look underneath it, we really did execute on a number of our strategic priorities. So we're carrying that momentum. Likewise, as Kelvin described, I think we're seeing margin stability in the short term. I am optimistic about just the reinvestment rate opportunity and the increased tractor maturities that we have on the back end of the year could give us some margin expansion opportunities. You combine that with the focus on productivity, and you would have seen our quarter-on-quarter growth actually decline in expenses by about 2% as we continue to lean in on productivity.

Speaker Change: But I do I do I am optimistic about just the.

Speaker Change: Vesmen right opportunity and the increased Ah tractor maturity's that we have on the back into the year could give us some margin expansion opportunities you combine that with the focus on productivity you would've seen our quarter on quarter growth.

Speaker Change: Actually declined expenses about 2% as we continued to lean in on productivity, it's going to be a big focus for US and then finally from a credit standpoint.

Leo Salom: And then finally, from a credit standpoint, as Ajai described, obviously, we're still living in a period of normalization, so we can't necessarily predict when we'll see that peak. But I feel really comfortable with the quality of the origination that we have in our cards and our auto business. In fact, in our cards business, the new through-the-door FICO scores today are higher than our back books.

Speaker Change: Andre described obviously, we're still living a period of normalization. So we can't be we can't predict necessarily one will see that pic, but I feel really comfortable with the quality of the origination that we have in our cards and our auto business in fact.

Speaker Change: And our cards business the news through the door FICO scores.

Speaker Change: Today are higher than our back books so.

Leo Salom: So we're really being very disciplined with regard to the business we're putting on. I put all that together to say that I'm confident that the outlook for the back end of the year and going into 2025 will be strong. And that will obviously, in answer to your question, translate into a higher return on equity profile. I don't want to give you a specific number with regard to – we haven't necessarily set a target. But if you look at where we were in previous periods, we were above – we were between 13 to 14 percent. I do think being able to revert back to that level is very feasible.

Speaker Change: We're we're really being very disciplined with regards to the business, we're putting on I put all that together to say that I'm confident that the outlook for the back end of the year and going into 2025 will be strong and that will obviously to your question translate into higher return on equity profile I I don't Wanna give you a specific.

Speaker Change: [noise] number with regards to we we haven't necessarily set a target, but if you look at where we were in previous periods. We were above 30, we were between 13 to 14 per cent.

Speaker Change: Do think being able to revert back to that level is very feasible.

Leo Salom: Thank you for that. And then the second question is just relating to consumer credit experience. In some ways, I'm surprised to see the U.S. underperform Canada or Canada outperform the U.S. given higher leverage among Canadian consumers. So maybe you can talk about some of the trends and differences you're seeing between the U.S. and Canada and why U.S. losses are higher versus Canada. Thank you. Certainly, so what we saw this quarter was PCLs are up. You know, both in Canada and the U.S., and impaired driving is... In Canada, it's driven by commercial auto and car, and the U.S. as well. It's commercial auto.

Speaker Change: Thank you for that and then the second question is just relating to consumer credit experience.

Some way surprised to see <unk> U S Underperform, Canada retirement, Kennedy outperform you asking higher leverage among Canadian consumers. So maybe you can talk to some of the trends and differences you're seeing between U S and Canada N Y U S losses are higher versus Canada. Thank you.

Speaker Change: Certainly so what are we saw this quarter actually was the seals are up.

Speaker Change: Both in Canada, and the U S and Embeds up both.

Speaker Change: In Canada, it's driven by commercial auto and guards and U S. As well, it's commercial ordering guards. The one difference this quarter is on performing B C O and that's because we built less performing in cash.

Ajai Bambawale: The one difference this quarter is performance, and that's because we built less performance in Canada. And the reason we built less performance in Canada is we built quite a bit of performance the previous quarter. And if you go and look at our HPI numbers last quarter, you would have seen it triggered, you know, a build, and we built for other areas like cards and commercials. So it's not like we haven't built in Canada.

Speaker Change: And the reason rebuilt less performing in Canada is rebuild quite a bit of performing the previous quarter and if you go and look at Ah H B I numbers last quarter, you would've seen it triggered you know a built and rebuilt for other areas like cards in commercials. So it's not like we haven't built in.

Ajai Bambawale: But yes, we built less, and then in the U.S., we actually had a small release in the U.S. last quarter and a bill based on volume and credit migration. Overall, I think the trends are, you know, consistent, but they can vary by quarter. They can vary by product.

Speaker Change: Yes, we built less and then in the U S. We actually had a small release and.

Speaker Change: In the U S last quarter and a bill based on what human credit My duration. This quarter's overall I think generally the trends are you know are are inconsistent, but they can vary by by quarter that can vary by product you know the other thing I I draw your attention to because you were really call them.

Ajai Bambawale: You know, the other thing I'd draw your attention to, because you're really calling out the difference in the consumer, if you look at our allowances. Okay, our allowance numbers year over year are up $790 million. Okay, that includes FX, but if you look at it segment-wise... Canadian PNC, the number has gone up $479 million; for US retail, it's 125 US $197. So that difference in the consumer has been taken into account in our allowance bill, but PCLs can vary by. Hopefully, that gives you some color.

Speaker Change: The difference into cringe humor, if you look at a lounge numbers, okay. Ah allowance numbers. Your over your are up $790 million. Okay that includes ethics, but if you look at each segment wise for Canadian PNC that number has gone up $479 million for you.

Speaker Change: U S. Retail is 125 U S 197, Canadian so that difference in the consumer has been taken into account in our.

Speaker Change: Lounsberry, but <unk> can can vary by quarter. So hopefully that gives you a color.

Unknown Executive: That does help. Thank you. And I'll leave it there...

Speaker Change: That does help thank you I'll leave it there.

Unknown Executive: Thank you. The next question is from Mike Rizvanovic of KBEW Research. Please go ahead. Your line is open. Good morning.

Speaker Change: [noise]. Thank you. The next question is from Mike None of it's from K B W. Research. Please go ahead with your line is open.

Raymond Chun: Question for maybe Ray or Kelvin, but I wanted to ask about non-interest bearing deposits, which were down in your Canadian business by about 5% quarter over quarter and just in light of the guidance we've been consistently hearing about this this runoff of NID is going to ebb and it clearly hasn't so why is it not moderating when I look at deposit rates and what what is offered on the deposit side it's not quite as I guess juicy returns for for customers as they might have been months ago or better part of 2023 so why is this not moderating at this point and what do you have any updated view on where it goes from here? So I take that it's Ray.

Mike: Morning question for maybe Ray your Kelvin, but I wanted to ask about non interest bearing deposits, which were down in your Canadian business by about five per cent core recorder and just in light of the guidance. We've been consistently hearing about this this run off and then I D is going to add and it clearly has.

Mike: So why isn't a moderating when I looked at deposit rates and what what is offered on the deposit side, it's not quite as.

Mike: I guess juicy returns for customers.

Mike: In <unk> better part of 2023. So why is this not bothering you at this point and what what do you have any updated view on where it goes from here.

Speaker Change: So long and I I'd take that it's ray. Thanks for the question. If you look at our overall deposits first let me start by saying one third of our deposits sits in checking the other third as in savings and another third is actually in term deposits. So a pretty good balance and Howard deposits actually line up from a volume.

Raymond Chun: Thanks for the question. If you look at our overall deposits, First, let me start by saying, you know, one third of our deposits sits in checking, the other third is in savings, and another third is actually in term deposits. So, a pretty good balance in how our deposits actually line up from a volume perspective. And we are definitely seeing moderation in our deposit migration. And so what you're seeing is actually money, like the deposits in the industry, migrating from our non-term deposits into our term deposits. The good story for TD is that, first and foremost, those deposits are staying within our four walls.

Speaker Change: Respective and we are definitely seeing moderation in.

Speaker Change: Our deposit migration and so what you're seeing is actually money like the within the industry deposits are migrating from our non term deposits into our terms of pauses. The good story for T. D is that first and foremost those deposits are staying within our our our four walls and we are seeing toll.

Raymond Chun: And we are seeing total deposits actually increasing by about 50 greater than 50% of our total deposits are actually new to the bank. So that's where you overlay that with our strong core deposit book, Market Leading in Canada. And that's where you're seeing the NIM expansion that you saw quarter over quarter. And so I'm pleased with, for me, our strategy around deposits and then the activity that we're actually seeing. And I think from a NIM perspective, our guidance has been excellent, that you're going to continue to see stable NIM at least for the second quarter. And then, as I think about our deposit business going forward, we're seeing terrific acquisition volume across TD, and you heard from Bharat's comments, we're seeing And so certainly, our value proposition is responding with our clients.

Speaker Change: It'll deposits actually increasing.

Speaker Change: And about 50, a greater than 50% of our total deposits are actually new to bank money and so that's where you're you know you're overly that with our strong core deposit book a market, leading in Canada, and that's where you're seeing the name expansion that you saw quarter over quarter and so I'm pleased with for me.

Speaker Change: Our strategy around deposits and what activity that we're actually seen and I think from a NIM perspective or guidance has been that you are going to continue to see stable name at least for the state of the second quarter and then I would just say that cause I think about our deposit business going forward that we're seeing.

Speaker Change: Terrific acquisition volume across a T D and you heard that from Berets comments, we're seeing record new account acquisition up 19% on a year on year basis, and so certainly our value proposition is resonating with our clients and we've seen five consecutive months of term deposit.

Raymond Chun: And we've seen five consecutive months of term deposit growth in market share. So I'd say overall, I hope that answers your question, but I get a good feeling, you know; I'm confident with our deposit strategy and our pricing strategy. That's certainly helpful, but I'm also thinking along the lines of, do you see any risk that even if rates do decline or when rates ultimately decline, there is some sort of difference in how the Canadian consumer views that demand deposit, that free funding that TD gets, and this will be more impactful for TD because of the size of its deposit base, but is there any risk in your mind that maybe Canadians are just a bit more demanding coming out of That's what I'm sort of getting at in terms of the funding side. I would say at this point that I'm not seeing anything that would show us that there's a difference on that question.

Speaker Change: Growth in market share. So I'd say overall I hope that answers your question, but I got a good you know I'm confident with our deposit strategy in our pricing strategy no no that that's certainly helpful. But I'm I'm also thinking along the lines of do you see any risks that even if rates do decline of when rates. Ultimately decline is there is some sort of difference in how the Canadian consumer.

Speaker Change: Humor views that demand deposit that that free funding. The T. D. <unk> this will be more and password for T V. Because of the size of your deposit base, but is there any risk in your mind that maybe Canadians are just a bit more demanding coming out of this rapid <unk> hiking cycle that we had and perhaps the the demand account to the free money that's been.

Speaker Change: <unk> you know available to fund your lending just is not going to come back in any sort of meaningful way, that's what I'm sort of getting out in terms of the funding side.

Speaker Change: Oh I would say at this point I'm not seeing anything that would show us that there's a difference on that on that question. What I would say is it again.

Raymond Chun: What I would say is that, again, what we continue to see is, from an acquisition standpoint, consumers are actually picking TD to do their day-to-day banking. We're seeing increased deposits overall, and we'll see, as interest rates moderate, we definitely do expect some of that deposit money will go into equities, but we'll see, and we'll adjust accordingly. But at this point, I'm comfortable with where we're at. Okay, I appreciate the callers. Thank you. Thank you. The next question is from Meny Grauman from Scotiabank. Please go ahead.

Speaker Change: We continue to see is from an acquisition standpoint consumers are actually picking T. D. Two to do their day to day banking, we're seeing increased deposits and an overall and we'll see as the as interest rates moderate.

Speaker Change: Do definitely do expect some of that deposit money will go into equities.

Speaker Change: But we'll see and we'll adjust accordingly, but at this point uncomfortable with where we're at.

Speaker Change: Okay I appreciate the colors. Thank you.

Manny Groben: Thank you. The next question is from many Groben from Scotiabank. Please go ahead and mine is open.

Riaz Ahmed: Hi, good morning. I had a question about wholesale banking and was hoping you could provide some color in terms of performance by geography, Canada versus the US, and sort of the different trends if we look at results between both geographies. Yeah, thanks, Meny. It's Riaz.

Manny Groben: Hi, good morning.

Manny Groben: I had a question about a wholesale banking and I was hoping you could provide some color in terms of.

Performance by geography camera versus the U S a N.

Mary Groben: The different trends if you look at the results.

Mary Groben:

Mary Groben: Between those geographies.

Speaker Change: Yeah. Thanks, many three hours.

Riaz Ahmed: Look, I think overall, when you kind of look at the revenue production this quarter at a billion, That's been a kind of a nice lift of about 50% from where we were in the last full year before we acquired TD Count in 2022, where revenue per quarter was averaging about a billion. And that kind of lift and is really coming from almost all areas in investment banking as well as in syndicated leverage finance, transaction banking as well as trade. And I was particularly encouraged that when, you know, last quarter, I mentioned that we had raised our revenue power by 25% to about $1.5 billion, so it's nice to see that as markets have, uh... become somewhat more supportive that that continues to grow and it's uh... giving you the uh... proof point that uh... that that the uh... acquisition is working, But look, as we continue to grow the wholesale segment, a large part of that growth is going to be based in the U.S. just because of the size of the relative market.

Speaker Change: Overall, when you kind of look at the revenue production this quarter at a billion eight.

Speaker Change: That's been a kind of a nice lift off about 50% from where we were in the last full year before we acquired Kitty count in 2022, where revenue per quarter was averaging about 1 billion too.

Speaker Change: And that kind of a list and is really coming from almost all areas in investment banking as well as in syndicated leveraged finance transaction banking Israelis trading.

Speaker Change: And I was particularly encourage that when you're in our last to our last quarter I mentioned that we had raised our revenue power to them by 25% or about 1 billion five so it's nice to see that as markets have.

Speaker Change: Becomes somewhat more supportive that that continues to grow and it's giving you the proof points that that the acquisition is working.

Speaker Change: But look as it continues to grow the wholesale segment, a large part of that growth is going to be a based in the U S. Just because of the size of their relative markets.

Riaz Ahmed: And while we've not historically disclosed the Canada versus U.S. revenue differences, I might consider that in the future, but really, we run a global business, and particularly on the global market side, and it's therefore sometimes a little bit of a bookkeeping exercise to parse the differences in liquidity, funding, etc. But I kind of look at the overall production and feel pretty good about it.

Speaker Change: And while I was not.

Speaker Change: Historically disclose the Canada versus a U S. A revenue differences out.

Speaker Change: Consider that in the future, but really run a global business and.

Speaker Change: Particularly on the global market side, and it said, therefore, sometimes can be a little bit of a bookkeeping exercise to parse the differences and liquidity funding et cetera, but I.

Speaker Change: I kind of look at the overall production and feel are pretty good about it.

Speaker Change: Mmm, just maybe ask a follow up question on this I can probably look at the.

Riaz Ahmed: Just to maybe ask a follow-up question on this, like if I look at the quarter of a quarter growth in revenue in wholesale banking, are we seeing similar growth rates between Canada and the US? I think the activity in both markets is coming back quite nicely. Equity capital markets have certainly shown more momentum in the U.S. than they have in Canada, but on the M&A side and the debt capital market side, Both sides of the market saw better days in Q1 than we did in Q4, and that momentum is coming back on both sides.

Speaker Change: Quarter over quarter growth in Ah in revenue in wholesale banking.

Speaker Change: We've seen similar growth rates between Canada, and the U S.

Speaker Change: I think the activity in both markets is coming back quite nicely or equity capital markets have certainly shown more more momentum in the U S and they have in Canada, but on the M&A side and that that capital markets side.

Speaker Change: Both sides of the market our seen better days, that's saw better days in Q1, then read read read it in queue for and that momentum is coming back on both sides of the market.

Unknown Executive: Thank you. This question is from Sohrab Movahedi from BMO Capital Markets. Please go ahead.

Speaker Change: Thanks for Ya.

Speaker Change: Thank you the.

Speaker Change: The next question is from the store I'm more of a heavy from BMO capital markets. Please go ahead. Your line is open.

Bharat B. Masrani: Thank you. Before I ask my question, I just wanted to clarify something. I think Kelvin... are you? I just want to try and interpret it correctly.

Speaker Change: Oh, Thank you I before I ask my question I, just wanted to clarify something.

Speaker Change: I can kelvin.

I: R U I just Wanna make sure I interpreted correctly, there's probably another customer minus $300 million restructuring charge next quarter.

Bharat B. Masrani: There's probably another plus or minus 300 million restructuring charge next quarter. No, so, what we said is that, (inaudible) The total charge is going to be $1,000,000. Okay, so last and last year the charge was 363 pre-tax.

Kelvin: No. So so what we sad is that in the call at first.

Kelvin: Of a calendar of this year.

Kelvin: The total charge is going to be similar to last year.

Kelvin: Okay, So last and last year charge being 363 pretax right.

Bharat B. Masrani: Okay, thank you. I appreciate that clarification, Bharat. The good news is, I think you've made it clear that the AML issues are understood, and progress is being made to fix them.

Speaker Change: Okay. Thank you and I appreciate that clarification Barrett.

Barrett: I mean, the good news is I think you've made it clear that the mental issues are understood.

Speaker Change: Yeah, well I suppose in progress is being made fixing them.

Bharat B. Masrani: Are you in a better position now versus a few quarters ago to give a sense of how long you think that will take and how much you think it will cost? I wish I could, Sohrab, and I'm hoping that I'll be able to, you know, in the near term. But suffice it to say, you know, as I said in my prepared remarks, we know what the issues are, we are working hard, you know, to improve and enhance our processes. And I'm confident that, you know, I've been with the bank many years, that when we get on to, you know, particular issues, we find we get on to those and, you know, fix them. And so this is, from my perspective, something that we are doing. And when I'm in a position to give you more information, I will... I am waiting to do that, and I will certainly...

Speaker Change: Are you in a better position now versus a few <unk> to give us some sense of.

Speaker Change: How long do you think that will take and how much do you think it will cost.

Speaker Change: I wish I could.

Speaker Change: And I'm, hoping that I'll be able to you know in the in the near term, but suffice it to say you know as I said in my prepared remarks.

Speaker Change: You know what the issues are we are working hard you know to.

Speaker Change: To improve and enhance our processes and I'm confident that you know I've been with the bank. Many years when we get onto you know particular issues refined we get onto those and and and you know fix them.

Speaker Change: And so this is from my perspective, something that we're doing it and when I'm in a position to give you more information I I.

Speaker Change: I'm I do I'm waiting to do that and and I will send me.

Bharat B. Masrani: I'll attempt to do that as quickly as I'm able. Okay, but you don't think like what the information you're awaiting from Bharat will have? potential impact of more restructuring charges or less of the benefits of the restructuring charges taken to date, you know, falling to the bottom line, or that will it re, do you wonder, or is it possible it will and necessitate a review of the expense program versus what you've kind of laid out for us currently. Oh, I think, you know, Kelvin laid out our expense profile for the year at NOQ4. Kelvin did say that our core expense growth is expected to be These are forecasts, and of course, things can change based on market conditions. Corp., you know, the increase should be in the 2% range.

Speaker Change: No attempt to do that as quickly as I'm able to.

Speaker Change: Okay, but you don't think like what information you are awaiting Barrett will it have.

Speaker Change: Potential impacts of more restructuring charges or less upset benefits of restructuring charges taken to date.

Speaker Change: Being you know fall into the bottom line or <unk> do you do you do wonder or is it possible equal.

Speaker Change: Necessitate a review of the expense program versus what you've kind of.

Speaker Change: Laid out before us currency.

Oh, I think it'll Kelvin laid out our expense profile for the year at the annual Q for you know, we Kelvin did say that al Gore expense grow the expected to be these therefore gas and of course, you know things can change based on market conditions Ah.

Speaker Change: Ah you know increase should win the 2% range, maybe add on the additional risks in control improve.

Bharat B. Masrani: If we add on the additional risk and control improvements that we said we will undertake, you know, that takes that number to mid-single digits. So I think that kind of gives you some sense as to how we are thinking about this. I think you also had indicated, Kelvin is sitting on my left, if I'm wrong, you know, please correct me, that some of these expenses will be in the corporate segment because, you know, we expect those to, some time in the future disappear and and some will be you know the running of some of these programs will be in the segments and, That'll mean, at least for a little while, the corporate segment expenses will be higher by approximately double than what you've seen in the past. Previous Years.

Speaker Change: Improvements that we said we will undertake that thinks that number to the mid single digits. So.

Speaker Change: I think that kind of gives you some sense as to how we are thinking about this I think he also had indicated kilwinning sitting on my left me if I'm wrong. Please correct me.

Speaker Change: That some of these expenses will mean, the corporate segment because you know we expect those too someday.

Speaker Change: Some time in the future disappear.

Speaker Change: And and some will be even though the running of some of these programs will be in the segments and and that will mean at least for a little while the corporate segment expenses will be higher by it'd be about approximately double than what you've seen in the previous years. So I think.

Bharat B. Masrani: So I think that gives you some sense, Sohrab, I don't think I can give you any more. No, no, I appreciate that. I appreciate the color.

Speaker Change: That gives you some sense or up I don't think I can give you any more.

Speaker Change: No no I appreciate that I I I I I appreciate the car I just wanted to make sure that what you had to kind of contemplating. This is what's kind of reflected in here and I guess the rest of it won't come out in due course, thank you for taking my questions. Thanks, Thanks very much.

Bharat B. Masrani: I just wanted to make sure that what you had kind of contemplated is what's kind of reflected here. And I guess the rest of it will kind of we'll hear about in due course. Thank you for taking my question. Thank you very much.

Unknown Executive: Thank you. The next question is from Lemar Persaud from Carmark. Please go ahead, your line is open.

Speaker Change: Thank you.

Speaker Change: The next question is from Lamar personal from Carmine. Please go ahead with your line is open.

Riaz Ahmed: Thanks, maybe for Riaz, could you talk about some of the actions you've taken in that business to right-size the cost base, and then, I'm wondering if you could just touch on the impact on your business from the proposed dividend tax changes in Q1 and expectations moving forward. Thanks, Lemar. Look, I think, as I mentioned last quarter, we completed the integration of the equities platform last year and a fair bit of the legal integration of the broker-dealers as well as some of the market-based technology integrations we expect to complete by the end of this calendar year. So I think as those integrations are advancing, and we've got the leadership structure fully now announced and in place to lead us into the next phase of growth here for the wholesale bank, I think all of that is allowing us to get to an aspirational efficiency ratio that I mentioned of 66% in the last quarter.

Yeah. Thanks, maybe for <unk> can you talk about some of the actions you've taken in that business the right size and the cost base and then.

Lamar: I'm wondering if you can just touch on the impact on your business from that propels the dividend tax changes in Q1 and expectations moving forward.

Lamar: Thanks, Lamar look I think as I mentioned last quarter, we completed the Ah Ah integration of the Ah Ah equities platform last year end of and and a fair bit of the ER League.

Lamar: Legal integration of the broker dealers as well as some of the market space technology integrations, we expect to complete by the end of this calendar year. So.

Lamar: So I think as those integrations are advancing and we've got the the leadership structure fully now announced in in place to lead us through there.

Lamar: Into the next phase of growth here for for the whole. So bank that I think all of that is allowing us to get to an aspirational efficiency ratio that I mentioned of 66% in the in the last quarter. So.

Riaz Ahmed: So today being the eve of the first anniversary of the closing of the acquisition of TD Count, I'm really thrilled about how much progress we've been able to make in the year. And while at the time of acquisition, we said the integration would take up to three years, it seems to be going a little bit faster than that. So I'm particularly happy about that. And just while we're on the call, because I know some of our colleagues listen, I think it's just worth calling out their big congratulations to all of them for taking us this far so quickly. Now, as far as the dividend tax matter goes, you can see from the notes in the financial statements that talk about the tax reconciliations that our annual dividend deduction has ranged from about $100 to $125 million a year.

Lamar: Today being the eve of the first anniversary of the closing of the acquisition of T. D town I'm I'm really thrilled about how much progress we've been able to make in a year and while at the time of acquisition reset the integration I would take up to three years, it seems to be going a little bit faster than that so I'm Ah Ah, particularly now.

Lamar: Happy about that.

Lamar: And in in just a while we're on the call cause I know our some of her colleagues you listen I think it's worth calling out their big congratulations to all of them for bringing us. This far so quickly now as far as a dividend tax matter. It goes you can see from the notes in the financial statements that talk to the tax.

Lamar: Nations that are annual dividend, a deduction has ranged from about $100 million to $125 million a year and so 112 stuff that would be the impact on our queue. One for 24.

Riaz Ahmed: So one-twelfth of that would be the impact on our Q1 for... Okay, and then moving forward, should we just take the queue on and just quarterize on that? So that's a reasonable expectation for? Yeah, I think so.

Speaker Change: Okay, and then I'm moving far colors should we just taking the couponing.

Speaker Change: <unk> corner I signed that so that's a reasonable expectation or yeah, I think I think that would that would be reasonable but of course, it's all buried in the otherwise fantastic growth, we're having elsewhere in the business across their business. So yes, I think for your modeling purposes that makes sense to adjusted by that much.

Riaz Ahmed: Yes, I think that would be reasonable. But, of course, it's all buried in the otherwise fantastic growth we're having elsewhere in the business across the business. So yes, I think for your modeling purposes, that makes sense to adjust.

Kelvin Vi Tran: I think it's important. The impact to Q1 is only one month out of three months. So, right. Right, right.

Speaker Change: I think it is important.

Speaker Change: The impact of Q1 is only one month out of three months, yes, so right.

Speaker Change: Right right, Okay, and then maybe for for Calvin just on this restructuring program. So obviously fairly large and it seems like you know you guys have the clarity.

Kelvin Vi Tran: Okay. And then maybe for Kelvin, just on this restructuring program. It's obviously fairly large, and it seems like you guys have good clarity on the size of the program and cost savings. I didn't see any changes to your 2024 and fully realized cost savings estimates.

Kelvin Vi Luan Tran: Clarity on the size of the program and cost savings I didn't see any changes to your 2024 and falling realized cost savings estimates. So maybe you could help me understand how much does this program is going to be used in kind of three buckets like growth initiatives rectifying. The a M. L issues, and then any amount south falling to the bottom line I think.

Kelvin Vi Tran: So maybe you could help me understand how much of this program is going to be used in kind of three buckets. So, like growth initiatives, rectifying AML issues, and then any amounts falling to the bottom line. I think, like, I think that's probably the right way to look at it. But any thoughts, and you know, if you could split that out between those three buckets, that'd be helpful. Yeah, so maybe the way to talk about it is through the numbers, you know, these savings that are coming out of this restructuring program.

Kelvin Vi Luan Tran: I like I think those that's probably the right way to look at it but Ah any thoughts and you know if you can just put that out between those three buckets that'd be helpful.

Speaker Change: Yeah. So it's it's.

Speaker Change: Maybe the way to talk about is through the numbers you know the savings that are coming out of this restructuring program, we expect savings and $400 million, four and $600 million and.

Kelvin Vi Tran: We expect savings of $400 million in 2024. 25. I would say the bulk of that would be reinvested in risk and control because you would have the range that we provided for the corporate segment. Although there are, and the residual would be, tribe.

Speaker Change: Twenty-five on an annualized basis.

Speaker Change: I would say the bulk of that.

Speaker Change: Would be reinvested in and risks in control because you would have seen in the range that we provide it for the corporate sentiment.

Speaker Change: The increase in that it is a big the main contributor would be risking control. Although there are many puts it takes them.

Speaker Change: And then the residual would be Ah and and driving that future growth.

Kelvin Vi Tran: So it's essentially just risk and control. And if you bucketed it into that, is it fair then to say that this spend isn't necessarily going to drive additional revenues or benefits to the bank outside of risk and control? I guess you can always say which one you prioritize because, at the end of the day, we are expecting a mid-single-digit expense. You say that that is going to drive investment, and then the rest is because of the growth in risk and control or the other first. We look at it on a portfolio basis, and we continue to re-prioritize. Okay, thanks. That's it for me.

Speaker Change: So it's essentially just risks in control in and if your bucket and into that is it fair then to say that the spend isn't necessarily going to drive additional revenues our benefits to the bank outside of risk in control.

Speaker Change: Like it's not fair I guess, you can always say, which one do you prioritise because at the end of the day.

Speaker Change: We are.

Speaker Change: Expecting made single digit expense growth and so can you you know would you say that that is going to drive investment and then the rashes because of the growth and risk in control at the other first we look at it as one portfolio basis that we could change the real prioritize given the environment.

Speaker Change: Okay. That's it for me.

Kelvin Vi Tran: Thank you. The next question is from Darko Mihelic from RBC Capital Markets. Please go ahead.

Leo Salom: Thank you. The next question is from Darko village from RBC Capital markets. Please go ahead and your line is open.

Unknown Executive: Your line is open. Hi, thank you for taking my questions. I know it's running long.

Leo Salom: Hi, Thank you for taking my questions I know, it's running along really quickly two questions for me with the first one.

Leo Salom: Really quickly, two questions for Leo. The first one, Leo, is when I look at the US business, I'm trying to understand what you're aiming for this year in terms of loan growth. And, you know, you can talk about this, whether it's relative to the industry, relative to where you are now, where do you see the biggest opportunities for growth? And given that the bank clearly has lots of capital, are you actually aiming for above-industry average kind of growth levels on the loan side? That's my first question. Great, Darko.

When I look at the U S business I'm trying to understand.

Darko: What you were aiming for this year in terms of loan growth.

And you know you can talk to this weather, it's relative to industry relative to where you are now where do you see the biggest opportunities for growth and giving them you know the.

The bank clearly has lots of capital are you actually aiming for above industry average kind of growth levels on the loan. So I. That's my first question right.

Leo Salom: Thank you very, very much for that question. Let me just give you a sense of it first at a macro level, and then I'll look at it, you know, within the bank. From a macro perspective, just to be clear, I do expect there to be moderation in the level of asset growth in the market as a whole. In fact, in fact, we saw that we were peer-leading in the quarter in the first quarter.

Speaker Change: Darker. Thank you very very much of that question. Let me. Let me just give you a sense first at a macro level and then I'll I'll look at it within the bank from a macro perspective, just to be clear I do expect there to be moderation in the level of you know.

Speaker Change: Asset growth.

Speaker Change: And the market as a whole in fact in fact, we saw that we were pure leading in the quarter in the first quarter. So to the extent that rates stay longer and to the extent that there's more pressure on consumers.

Leo Salom: So to the extent that rates stay longer, and to the extent that there's more pressure on consumers, I do expect that there will be some moderation in consumer loan demand, and on the commercial side, we've seen commercial entities pulling back a little bit, waiting to see what happens with rates, and so they're taking a shorter view with regard to some of their decisions. Now, from our perspective, in particular, I think we find ourselves in a bit of a unique situation. As I think I shared with you, we've got 10 million retail clients, and we've been historically, So the ability to bring our cards, our bank cards, to bear on that, you know, on that, on that subset of consumers, to the extent that we can bring, you know, mortgage products and, obviously, continue to grow our broader consumer lending, it's an opportunity. So just to bring that to life a bit, in our cards business, about 16% of our consumers today have a TD bank card in their wallet.

Speaker Change: I do expect that there'll be some moderation consumer loan demand and on the commercial side we've seen.

Speaker Change: Ah commercial.

Speaker Change: Entities pulling back a little bit waiting to see what happens with rates and so they're they're taking a short review with regards to some of their decisions now from our perspective in particular, I think where we find ourselves in a bit of a unique situation as I as I think I share with you. We've got we've got 10 million retail clients and we've been historically under.

Speaker Change: Penetrated in terms of our consumer lending businesses. So the ability to bring our cards or bank cards offer to bear on that on that on that subset of consumers to.

Speaker Change: To the extent that we can bring mortgage products and obviously continue to grow our our broader consumer lending it as an opportunity. So just to bring that to life a bit and our cards business about 16% of our consumers.

Speaker Change: Consumers today have a T D bank card in their wallet.

Leo Salom: Our aspiration is to double that. So, to the extent that we lean into the honest opportunity, I do think that we'll be able to outgrow the market. And that's what we did over the past three or four quarters.

Our aspiration is to double that so that will give us to the extent that we lean into the honest opportunity I I do think that will be able to outgrow the market and that's what we've done over the past three or four quarters. So that that really goes to what we're doing the consumer side.

Leo Salom: So that really goes to what we're doing on the consumer side. Likewise, on the commercial side, you saw us post relatively strong growth. And I would say the partnership with TD Cowen and TD Securities is at the heart of that. The work that we're doing to redefine our mid-market franchise, hand-in-hand with Riaz's team, is giving us an opportunity to be able to cast a much bigger shadow in the mid

Speaker Change: Likewise on the commercial side, you sauce post relatively strong growth and I would say the partnership with T. D Cowan and TD Securities is at the heart of that the work that we're doing to redefine our mid market franchise.

Speaker Change: A hand in hand with three as his team is giving us an opportunity to be able to to cast a much bigger shadow in the mid market space and so we're we're really excited about that the the fact that the market is experiencing some degree of liquidity.

Leo Salom: And so we're really excited about that. The fact that the market is experiencing some degree of liquidity challenges while we are in a much stronger position is giving us the ability to be selective and support clients through this sort of macro environment. So, long-winded way of saying, I do believe that we'll be able to outperform from a lending perspective in the short term, but we're going to do that prudently. We're going to do that, we'll respect our underwriting criteria, we'll make sure that we're putting on good, effective credit, but I do think we should be able to outperform the market. Okay, thank you Leo. That's actually a very helpful answer. And my next question, and please don't judge me; this might be a stupid question.

Speaker Change: Challenges, while we are in a much stronger position is giving us an ability to be selective and be able to support clients through this sort of macro environment. So long winded way of saying I I I I do believe that will be able to outperform from a from a lending perspective in the short term, but we're gonna do that prudently we're gonna.

Speaker Change: Do that will will respect our underwriting criteria will make sure that we're we're putting on good effective credit, but I do think we should be able to outperform the market.

Speaker Change: Okay. Thank you that's actually very helpful and Sir.

Speaker Change: And my next question and please don't Judge me this might be a stupid question I I just don't know how this works so.

Leo Salom: I just don't know how this works. So, you know, today you announced a three-year US $20 billion community impact plan. So how should I think of that? Should I think of 20 billion consumer loans sort of coming on your balance sheet over the next three years? And, you know, I don't imagine these would be high-spread but possibly high TCL.

Speaker Change: Today, you announced a three year U S 20 billion dollar community impact plan, yeah. So how how should I think about should I think of 20 billion consumer loans sort of coming on your balance sheet over the next three years and.

Speaker Change: And you know I don't imagine he would be high spread, but possibly hi P. C L.

Leo Salom: I mean, how should I think about this plan and what I should be doing with my model having heard this today? So, Darko, it's a really good question. First of all, let me say that I'm exceptionally excited that TD made this announcement. So, just to define what it is, first of all, because I think it would be useful.

Speaker Change: Should I think about this plan and and what I should be doing with my model having heard this today.

Darker: Darker it's it's a really good question first of all let me, let me say that I'm I'm exceptionally excited.

Darker: T D made this announcement so just to define what it is first of all because I think it would be useful. So the $20 billion is really comprised of three lending categories that $10 billion of that is mortgage lending to LMI consumers.

Leo Salom: So the $20 billion is really comprised of three lending categories. That $10 billion of that is mortgage lending to LMI consumers, or I say in the LMI community. Another $3 billion is to minority-led small businesses right across our footprint. And the final piece is $7 billion to... the Development Financing for Affordable Housing Program. I just want to remind everyone that we are obligated, based on fair lending obligations in CRA, to make those investments, and we have been for some time. I think what this program does is lean in a little harder in a couple of categories to make sure that we are supporting our communities. It's fundamental to who we are. It's been part of our core culture since.

Darker: Or I say in Ah in LMI communities. Another 3 billion is to minority led small businesses right across our footprint and the final piece of $7 billion to Ah Ah Ah development financing to affordable housing programs.

Darker: I I just want to remind everyone that we are we are obligated based on fair lending obligations in CRA to make those investments and we have been for for some time I think what this program does is leaning a little harder in a couple of categories to make sure that we are we are supporting our communities.

Darker: It's fundamental to who we are it's been part of our.

Darker: Core culture, so I I I I wouldn't expect this to translate into any sort of deterioration in our in our credit performance will continue to apply rigorous underwriting standards to those to these programs, but it it is meant to be even more deliberate with regards to our fair lending at our and our CRA obligate.

Leo Salom: I wouldn't expect this to translate into any sort of deterioration in our credit performance. We'll continue to apply rigorous underwriting standards to these programs, but we are meant to be even more deliberate with regard to our fair lending and our CRA obligations. And these are all on the balance sheet, correct? Okay, thank you. Thank you. There are no further questions registered at this time. I will turn the call back to Darko. Just to clarify on this, you know, on the mortgage side, there are times when, if they're conforming mortgages, you know, we transfer them to Fannie and Freddie. And so, you know, to try and take dollar for dollar and say this will be the balance sheet, there's probably more. We should provide you with more sort of explanation on that, you know, at a future date.

Darker: <unk>.

Darker: And these are all on balance sheet correct.

Speaker Change: Ah yes, Sir.

Speaker Change: Okay. Thank you.

Speaker Change: Thank you.

Speaker Change: [noise] questions about just stood up this time.

Call back to Australia.

Speaker Change: Yeah. Thanks, very much just darcheville just to clarify on on the mortgage side there are times when they're conforming mortgages.

Speaker Change: Transfer them to Fannie and Freddie and so you know to try and dig dollar for dollar instead of this sort of in the balance sheet.

Speaker Change: There's probably more of we should provide you with more sort of explanation on that you know at at a future date with just to clarify that because you know.

Unknown Executive: But just to clarify that, because, you know, [inaudible] But overall, you know, I'm thrilled with how the team has delivered. Like I said earlier, the momentum in our businesses is strong. We've had good volume, excellent volume growth in Canada, good loan growth in the U.S., TD Securities and TD Cowan coming together, and I would add my congratulations to our colleagues in the Wholesale Bank. Today is the eve of a major, major milestone, so it's great, great that we've come so far. And, of course, I notice it's Mr. Wiggan. The rest of us go by first names.

Speaker Change: It's a it's a particular feature of the U S market that sometimes it's not well understood.

Speaker Change: But overall you know I'm thrilled with with how the team is delivered like I said earlier, the momentum and our businesses as strong.

Speaker Change: Good volume excellent volume growth in Canada, you know good loan growth in the U S. You know tedious Securities D D Garland coming together and I would add my congratulations to our colleagues in the wholesale bank today is.

Speaker Change: He will have a major major milestones. So it's great great that we've come so far and of course I notice as Mr. Wiggins. The rest of his school by first names [laughter], Tim Great Ah Great do have you on this call as well so with that I would also big this opportunity to thank God 95000 bankers around the world.

Bharat B. Masrani: Tim, great to have you on this call as well. So with that, I would also take this opportunity to thank our 95,000 bankers around the world. They are the ones who deliver for all our stakeholders, including our shareholders.

Speaker Change: They are the ones, who deliver for all our stakeholders, including on shareholders. So thank you and we will see you next quarter. Thanks very much.

Unknown Executive: Thank you, and we will see you next quarter. Thanks very much. Thank you. The conference has now ended. Please disconnect your line at this time, and we thank you for your participation.

Speaker Change: Thank you. The conference has now ended please disconnect. Your line at this time and we thank you for your participation.