Q1 2024 The Toronto-Dominion Bank Earnings Call

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Unknown Executive: 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. Thank you, operator.

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All participants prescribed by your confidence 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 Hills: But I don't like to turn the meeting over to Miss Bruch pills head of Investor Relations. Please go ahead Miss Hills.

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

Brooke Hales: 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.

Miss 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 the I N S.

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 Treaties 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.

Miss Hills: The Chippewa the hold on his shoney and the wind up peoples and is now home to many diverse nations may T and any read People's. We also acknowledged that Toronto is covered by Treaty 13 signed within Mississauga's of the credit and the Williams Treaty signed with multiple Mississauga in Chippewa band.

Speaker Change: We will begin today's presentation with remarks for embarrassments, Ronnie took with the.

Speaker Change: The Bank C E O after which Calvin Tran the bank C. F O will present, our first quarter operating results <unk>, 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 Wiggin, Group Head, Wealth Management and Insurance, Leo Salam, 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 America's most convenient bank and <unk> on that 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 at 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 sanctions 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 shareholders and analysts and understanding the banks financial position objected 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 belief. It 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 turn to our results, I'd like to welcome Tim Wiggin, 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 results I'd like to welcome Tim wooden group had worked.

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

Barret: John is also the call now in his capacity as group good Canadian personal 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.

Barret: Speaking with many of you over the past quarter I know there are questions relating to the bags investments in a risk of control infrastructure, including an R. M. L program.

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

Barret: Responsibility seriously to live up to our high standards.

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

Barret: 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.

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

Barret: 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 they can.

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.

Barret: Do what was a good quarter what D D earnings with $3.6 billion in EPS was $2 revenue grew 5% in your ear, reflecting higher fee income and and and.

Barret: Brubeck macroeconomic environment for our work is driven businesses, including the contribution from D. D. Garland at higher volumes of deposit barges in Canadian personal lives commercial banking.

Barret: B C L two or higher due to continued consumer credit globalization and commercial credit migration in line with our prior guidance.

Barret: While expenses were up 12% year over year, reflecting the inclusion of did you go and expensive growth moderated or the quarter over quarter basis, we made progress on a restructuring initiatives delivery efficiencies across the enterprise, while continuing to prioritize investments in a risk of the control infrastructure.

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

Barret: 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.

Barret: And an uncertain market video roommates well position.

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

Barret: Last quarter I highlighted TD invent the bank's enterprise approach to innovation.

Barret: We have reached that milestone as of this quarter DDS 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 DVD accessibility adapter.

Barret: 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.

Barret: Let me know to do each of our businesses are reviews of highlights from fjord.

Barret: Canadian personal and commercial banking segment earnings were $1.8 billion up 3% year over here and be TBB was $2.9 billion up 6% year over year 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, personal deposits grew 3% quarter over quarter, and 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've 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.

Barret: We saw a 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.

Barret: Real estate secured lending Didi recorded its eight consecutive month of market share gains and personal deposits grew 3% order of a quarter.

Barret: And everyday banking, we saw strong advisor productivity and record customer acquisition with new account up 19% year over year and another strong quarter for neutral candidate Gov.

Barret: And credit cards, we celebrated a 10 year might as soon as the primary credit card issuer for Arrow Blood, Canada stop Airlines loyalty program.

Barret: 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 <unk> credit cards enough to fly round trip from Toronto to Los Angeles.

Barret: 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. For more information, visit www.tdautofinance.com. Turning to the U.S., U.S. retail bank earnings were $752 million U.S., down 26% year-over-year, and PTPP was $1.1 billion US, 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.

Barret: And business banking, we grew loads by 8% year over year small business banking helped over 165000 clients conveniently repaid ciba loans, providing over 70000, preapproved refinancing offers and almost $600 million in loans.

Barret: We saw growth and duty auto finance, reflecting strong performance and Brian retail auto lending, an accelerated acquisition of dealer relationships and a commercial business year over year.

Barret: Turning to the U S U S retail bank earnings, what's the $152 million U S down 26% year over year, and PTB was 1.1 billion U S dollars down 17% year over year <unk>.

Barret: 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 2% order of a quarter is the bank's productivity initiatives helped upset higher employee related costs and investments and business of control.

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 portfolios, with the contribution from our investment in Schwab of $144 million. Segment earnings were US$896 million. The U.S. retail bank saw continued loan growth while maintaining its through-the-cycle underwriting standard. 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.

Barret: All controls initiatives <unk>.

Barret: <unk> higher compared to last year with the increase reflected in both the consumer and commercial lending portfolio is with.

Barret: With the contribution from our investment and Schwab of $144 million.

Barret: Segment earnings were 896 million U S dollars.

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

Barret: Those were up 9% year over year, reflecting growth and mortgages middle market.

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

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

Barret: Citibank America's most convenient being is serving small business loans with innovative solutions. This quarter, we added tab to pay on iPhone one of the first wings globally. The launch with this feature integrated within our mobile App will 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 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.

Barret: Through through near real time payment capabilities.

Barret: And last month delay Bank of America is most convenient bank announced a three year community impact plan that will provide an estimated 20 billion U S dollars supporting lending philanthropy banking axes, and other activities for divers in underserved communities across our use footprint.

Barret: The wealth management insurance segment earned 555 million this quarter flat year over here.

Barret: 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.

Barret: This month Didi directly investing was ranked as the number one direct investing brokerage in Canada by the globe and mail for the second consecutive year.

Barret: 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.

Barret: Onto DVD active traders the banks completely redesigned platform for sophisticated active traders.

Barret: We had a strong start start to the year in Didi asset management with several large institutional mandates across multiple geographies, one and funded.

Barret: And we were proud that several DRAM managed funds would recognize with 20 twenty-three fund 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.

Barret: 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.

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

Barret: We're gaining market share across U S M&A and equity capital markets as we leverage the power of <unk> <unk>.

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

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

Barret: We're executing on one DVD opportunities this quarter DB Securities Didi World enables fully paid lending to enhance returns will wealth lines.

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 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. 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. Guided by our purpose, TD 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. 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.

Barret: And in partnership with DD Bank of America is most convenient bank, we began to issue equity links the difficulties of deposit broadening the suite of products available declines in the U S.

Security is also continued to demonstrated leadership and ESG acting has joined lead manager on Dd's 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.

Barret: And gave w's 1.5 million Australian dollars Greenberg, the issuers, the largest ever transaction and the Australian market.

Barret: Guided by our purpose is committed to creating value for all of our stakeholders.

Barret: How'd that the bank was listed in the Dow Jones Sustainability Index, North America index for the 12th consecutive year <unk>.

Barret: <unk> was also recently named it 2024, S&P global sustainability yearbook member awarded to banks in the top 15% of S&P's corporate sustainability assessment worldwide.

Barret: Last month the T.

Barret: <unk> charitable foundation launch its 18th annual housing for everyone Grand competition the.

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.

Barret: Competition will 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.

Barret: And in a few weeks <unk> will release, its 2023 sustainability reporting sweet, including our climate action plan.

Barret: We're excited to share the progress enabled by dedicated colleagues across the bank will transform our explorations into action.

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

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

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.

Kelvin Vi Luan 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 bank accounts. 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. DCLs 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: Expenses, reflecting the inclusion of TB Cowan also increase year over year, reflecting higher employee related expenses.

Speaker Change: We moderated expense growth on a quarter over quarter basis, and made progress on a restructuring initiatives and re prioritize our investments.

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

Speaker Change: As a result earnings were $3.6 billion in EPS was $2 down, 12% and 10% year over year, respectively.

Kelvin Vi Luan 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.

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

Speaker Change: We also adopted Ifr 17 this quarter.

Speaker Change: On Slide 26, you will see that we have updated our presentation of PTP to show revenues net of insurance service expensive.

Speaker Change: Please turn to slide 11.

Kelvin Vi Luan 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.

Speaker Change: As I sat on our queue for 2000 twenty-three 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.

Speaker Change: For fiscal 2024, we expect adjusted expense growth in the mid single digits, reflecting investments and our risk and control infrastructure and the impact of television Coward.

Speaker Change: 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.

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

Speaker Change: Cost savings will be driven by a 3% FTE reduction.

Speaker Change: State optimization, an asset impairments as we accelerate transitions to new platform.

Speaker Change: This will create capacity to reinvest.

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

Kelvin Vi Luan 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.

Speaker Change: Please turn to slide 12.

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

Speaker Change: Average loan volumes roles, 7% year over year, with 7% growth and personal volumes driven by real estate lending up 6% in carts up 11% and 8% growth and business volumes.

Speaker Change: 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 seabaugh.

Kelvin Vi Luan 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.

Speaker Change: Net interest margin was two point, 84%.

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

Speaker Change: 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.

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

Speaker Change: The U S retail bank deliver a strong loan growth and operating momentum and a challenging environment.

Speaker Change: Average loan volumes increased 9% year over year.

Kelvin Vi Luan 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.

Speaker Change: Personal loans increase reflecting lower mortgage repayments in the higher rate environment strong auto originations and double digit growth in Tds proprietary bank card book.

Speaker Change: Business loans increased reflecting good originations from new customer growth and slower payment rates.

Kelvin Vi Luan Tran: Strong Auto Originations and Double-Digit Growth in TD's Proprietary Bank Card Book. 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 markets. The net interest margin was 3.03%, down 4 basis points quarter-over-quarter due to lower deposits, offset by the benefit of higher reinvestment.

Speaker Change: 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 relief resilience and competitive market conditions.

Speaker Change: Net interest margin was three point, all 3% down four basis points quarter over quarter due to lower the pole.

Speaker Change: The cost partially offset by the benefit of higher reimbursement rates.

Speaker Change: As we look forward to a cue to 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 them to be relatively stable in the near term influenced by similar drivers ourselves we solve this quarter.

Kelvin Vi Luan Tran: 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 they decline quarter-over-quarter as productivity initiatives help offset higher employee-related costs and Please turn to slide 14.

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

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

Speaker Change: We have added slide 35% to this presentation to assist in this regard.

Kelvin Vi Luan Tran: 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 news. Both management and insurance delivered good performance this quarter, reflecting the strength of the segment's diversified business. However, 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.

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

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

Speaker Change: 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.

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

Speaker Change: That trend has begun to moderate.

Speaker Change: We're also executing upon initiatives to help ensure TD retains backflow in-house and captures flows from other institutions.

Kelvin Vi Luan Tran: Like peers across the industry, we have seen deposits flow into GIC and other products in the high rate environment, and that trend has begun to reverse. 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.

Speaker Change: Assets under management increase year over year, reflecting market appreciation and assets under administration increase year over year, reflecting market appreciation and net asset growth.

Speaker Change: Please turn to slide 15.

Wholesale banking delivered record revenue.

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

Speaker Change: 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.

Speaker Change: Revenue, including television Cowan was $1.8 billion up 32% year over year pre.

Kelvin Vi Luan 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. 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.

Speaker Change: Primarily reflecting higher equity commissions learning revenue, primarily from syndicated and leveraged finance underwriting fees and trading related revenue.

Speaker Change: Expenses increased 60% year over year, reflecting the provision I mentioned as well as higher variable compensation commensurate with higher revenues.

Speaker Change: Excluding this provision expenses increased 49% year over year, reflecting the inclusion of television Cowan, which closed March 1st last year.

Speaker Change: Please turn to slide 16.

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

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

Speaker Change: Please turn to slide 17.

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

Kelvin Vi Luan 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 seven. 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. Okay, thank you, Kelvin. And good morning, everyone. Please turn to slide 18.

Speaker Change: Internal capital generation was offset by an increase in our WOA, excluding the impact of effects, primarily reflecting volume growth.

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

Speaker Change: Regulatory changes, which included the fundamental review of the trading book and negatively amortizing mortgages decreased 81 by 17 basis point this quarter, primarily reflecting an increase in March.

Speaker Change: Without RJ over to you okay. Thank you Kelvin and good morning, everyone. Please turn to slide 18.

RJ: Grass impaired loans 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.

Speaker Change: And continued normalization of credit performance in the consumer lending portfolios and.

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

Ajai K. Bambawale: 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, cross 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, Please turn to slide 20. 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.

Speaker Change: Please turn to slide 19.

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

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

Speaker Change: Please turn to slide 20.

Speaker Change: Recall that our presentation reports bcl ratios, both 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 full.

Speaker Change: Fully absorbed by our partners and do not.

Pack the bank's net income.

Speaker Change: 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.

Ajai K. Bambawale: The 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.

Speaker Change: Please turn to slide 21.

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

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

Speaker Change: Performing PCL decrease $92 million quarter over quarter to 67 million.

Ajai K. 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.

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

Speaker Change: Please turn to slide 22.

Speaker Change: The allowance for credit losses increased by $79 million quarter over quarter to $8.3 billion due to current credit conditions, including some credit migration across the lending portfolio.

Ajai K. 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 base, 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 past two quarters.

Speaker Change: And William growth.

Speaker Change: Partially offset by a 122 million impact from foreign exchange.

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

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

Speaker Change: Key credit metrics in our consumer lending portfolios.

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

Speaker Change: Notwithstanding current conditions performance of our Canadian Resolute portfolio reflects its strong underlying credit quality.

Speaker Change: As impaired bcl's remain at less than one basis point and we see continued reductions in the negatively amortizing population.

Speaker Change: Moving to non retail.

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

Ajai K. Bambawale: Canadian and U.S. commercial gross impaired loans and PCLs have risen over the past year from cyclically low levels, 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.

Speaker Change: <unk> and U S commercial grosse impaired loans and pcos have risen over the past year from cyclically low levels consistent with the economic trajectory.

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

Speaker Change: Banks exposure to the office segment 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 with our prior guidance.

Speaker Change: Looking forward.

Speaker Change: I continue to expect Pcl'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.

ER: ER one.

ER: The devices keypad.

ER: 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 register. 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.

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

ER: We thank you for your patience.

Speaker Change: First question is from.

Walla: Walla from Bank of America. Please go ahead with your line is open.

Walla: Yeah good morning.

Walla: I guess, maybe just.

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, like how long you want to be in the seat and how we should think about it, that would be really helpful.

Walla: For you.

Walla: Healthy amount of speculation around how long you'll be in your seat and instead of C. A succession waiting to happen at T D I.

Speaker Change: I appreciate the support that 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 adjust 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: They're very nice to hear your voice and good morning to you.

Speaker Change: I've read some of these reports and and of course speculation what I can tell you is I am really focus on strengthening the bank.

Speaker Change: Serving our customers and creating value for our shareholders.

Speaker Change: We have a deep and highly experienced <unk> senior leaders, including those on the call with me. This morning, and hopefully menu. If you can see these this team is delivered and a great momentum and all of our businesses look at Canadian PNC and are.

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, T.D. Cowan is hitting on all cylinders.

U S business notwithstanding some of the challenges there.

Speaker Change: 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 we are very detail in robot succession plans across the bank.

Bharat B. Masrani: And so I'm very happy as to how the team is delivering. And we've talked about this before, as you would expect, 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 right?

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

Speaker Change: And you wanted to <unk> to come to you that.

Bharat B. Masrani: That I'm focused. Every day I wake up, I'm focused on strengthening the bank. And, you know, serving our customers is, of course, 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? Again, for those of us who have followed TD for a long time, the assumption is always that TD is always ahead of the curve in terms of management, risk controls, and investments. What do you think happened there?

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

Speaker Change: Those of US who followed T 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.

Bharat B. Masrani: And does that cause you to kind of re-evaluate 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, we are working very hard to fix it, and it will get fixed.

Speaker Change: Any other issues that emerge.

Speaker Change: Oh.

Speaker Change: Abraham as you know you know I can't talk.

Speaker Change: More about the specific issue, but I'm sure 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.

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 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: As far as a control infrastructure we.

Speaker Change: This is an ongoing.

Speaker Change: <unk> for for TB or any.

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

Speaker Change: Keep up with it and where appropriate be ahead of it. So it is 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.

Unknown Executive: Thank you. The next question is from Gabriel Dechaine from National Bank Financial. Please go ahead. Your line is open. Good morning.

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.

Gabriel: Barrett.

Unknown Executive: Twenty 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, you know, 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. Wiggin.

Gabriel: A million dollars insurers repurchased you're still committed to the full money amount.

Gabriel: Under the current program well.

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 and we will continue to do to execute against that program.

Gabriel: Perfect next question for Mr. Wigan.

Tim Wiggin: 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?

Speaker Change: <unk> well wealth.

Unknown Attendee: <unk> earnings were flat year over year market really move against but also insurance.

Unknown Attendee: Just wondering about.

About the one of the issues P&C insurance in particular is facing is auto theft, and it's just a problem of keeps getting worse how are you.

Tim Wiggin: 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.

Unknown Attendee: How have you been reflecting that near pricing and.

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 breakdown volume.

Speaker Change: Versus a premium increases, but a healthy number overall on the.

Speaker Change: Side of.

Speaker Change: A 15% increase as you have mentioned, we now have the insurance service expense, which was up <unk>.

Speaker Change: 17% in the quarter and as you know that includes claims along with the maintenance and acquisition.

Speaker Change: So auto theft.

Speaker Change: As a major issue in Canada, we had the the National Forum on February the eighth.

Tim Wiggin: 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: So when you look at claims it's also claims severity.

Speaker Change: 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.

Speaker Change: So similar to what you see with an Apple products.

Speaker Change: Randomly placed and what we found is said those cars are are often is you know a place somewhere.

Tim Wiggin: 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 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 more normal claims related issues on the auto side, we have 25.

Speaker Change: TD insurance auto centers, where you can not only get your car fixed but rent a vehicle.

Speaker Change: In addition, we have eight partnership where we have.

Speaker Change: 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.

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 Wiggin: 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 from CIBC. Please go ahead. Your line is open.

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

Paul David Holden: 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, which is clearly below where you would 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 us banking business.

You reported and adjusted Roy this quarter of a little over 11, Alright Goodbye attribute some of the investments are making to risk can control to that segment rather than corporate then maybe it pushes the number down closer to 10.

Paul: What was the question is 10, clearly below where you would like it to be.

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

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

Paul David Holden: 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.

Paul: 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.

Paul: Is quite challenging you saw some of that in the in the financial this quarter, but if you look forward as a number of things that I 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 in our retail and commercial loan portfolios retail was up 11% <unk>.

Leovigildo 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.

Leovigildo 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 do – 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.

Paul: Mercil was up seven and if you look underneath it we really did execute on a number of our strategic priority. So we're carrying that momentum likewise as as Kelvin described I think we're seeing margins stability in the short term.

Paul: I do I am optimistic about just the reinvestment right opportunity and the increased 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 have seen our quarter on quarter grew.

Paul: <unk>.

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.

Leovigildo 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.

Paul: As RJ 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.

Paul: Cards business the news through the door FICO scores.

Paul: Today are higher than our backpacks so.

Leovigildo 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.

Paul: 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.

Paul: Higher return on equity profile.

Paul: I don't Wanna give you a specific number with regards to we haven't necessarily set a target, but if you look at where we were in previous periods we were above.

Paul: 13, we were between 13% to 14%.

Paul: I do think being able to revert back to that level is very feasible.

Leovigildo Salom: And then my second question is just relating to consumer credit experience; I'm surprised to see US underperform Canada or Canada outperform US given higher leverage among Canadian consumers. So maybe you can talk about some of the trends and differences you're seeing between US and Canada and why US losses are higher versus Canada. Thank you.

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

Paul: Some way surprised to see U S. Underperform cannot return on Canada perform you ask given higher leverage among Canadian consumers. So maybe you can talk to some of the trends and differences you are seeing.

Paul: Between U S and Canada, Nyus losses are higher versus Canada. Thank you [noise].

Ajai K. Bambawale: Certainly. So what we saw this quarter was PCLs are up. You know, both in Canada and the U.S. and in... In Canada, it's driven by commercial auto and car, and the U.S. as well.

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

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

Speaker Change: Beds up.

Speaker Change: Both.

Speaker Change: In Canada, it's driven by commercial auto and guards.

Speaker Change: U S as well, it's commercial ordering the cards.

Ajai K. Bambawale: I think 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, 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.

The one difference this quarter is on performing <unk>.

That's because we built less performing in Canada, and the reason rebuild less performing in Canada is rebuild quite a bit of performing the previous quarter and if you go and look at Ah HPA numbers last quarter, you would've seen it triggered a.

Speaker Change: Built and rebuilt for other areas like cards in commercials. So it's not like we haven't built in Canada, but yes, we built less and then in the U S. We actually had a small release in in the U S last quarter and build based on what human credit my duration this quarters.

Speaker Change: Overall, I think generally the trends are.

Speaker Change: Consistent but they can vary by by quarter that can vary by product. The other thing I draw your attention to because you were really calling of the difference in the consumer if you look at Ah allowance numbers, Okay allowance numbers year over year are up $790 million, okay that.

Ajai K. 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 allowance. Okay, our allowance numbers year over year are up 790 million dollars. 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: Includes efforts, but if you look at each segment wise for Canadian PNC that number has gone up $479 million for U S. Retail is 125 U S 197, Canadian so that difference in the consumer has been taken into account in our allowance but.

Speaker Change: Sales 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. Thank you. Thank you. Thank you. The next question is from Mike Rizvanovic of KBW Research. Please go ahead. Your line is open. Good morning.

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

Speaker Change: [noise]. Thank you. The next question is from Mike None of it 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% corps per 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 isn't 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 customers as they might have been months ago or better part of 2023 so why is this not monitoring at this point and what do you have any updated view on where it goes from here So I take that it's Ray. Thanks for the question.

Speaker Change: 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 hasn't so why isn't a moderating when I looked at deposit rates and what what is offered on the deposit side, it's not <unk>.

Speaker Change: <unk> I.

Speaker Change: I guess juicy returns for customers it might've been.

Speaker Change: Or 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 I'll take that it's Rey. 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 lineup from a volume.

Raymond Chun: If you look at our overall deposits, first, let me start by saying that 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 with the industry, is 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: <unk> and we are definitely seeing moderation in.

Rey: Our deposit migration and so what you're seeing is actually money like the within the industry deposits are migrating from our <unk>.

Rey: Non term deposits into our terms of pauses. The good story for TB is that first and foremost those deposits are staying within our our four walls and we are seeing total deposits actually increasing and.

Raymond Chun: And we are seeing total deposits actually increasing by about 50, greater than 50% of our total deposits are actually new to, And 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 I would just say that, as I think about our deposit business going forward, that we're seeing terrific acquisition volume across TD. And you heard from Bharat's comments, we're seeing record new account acquisition up 19% on a year-on-year basis. And so certainly, our value proposition is responding with our clients.

Rey: And about 50% greater than 50% of our total deposits are actually new to bank money and so that's where you're you're overly that with our strong core deposit book 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.

Rey: 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 as I think about our deposit business going forward.

Rey: That we're seeing terrific acquisition volume across TD and you heard that from Barrett 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 have seen five consecutive months of term deposit growth in market share so right. So.

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, is there some sort of difference in how the Canadian consumer views that demand deposit, that free funding that TD gets? And this would 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 this rapid-rate hiking cycle that we had?

Speaker Change: Overall I hope that answers your question, but I got a good.

Speaker Change: 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 views that demand deposit that that free funding the <unk>.

Speaker Change: This will be more and password for television because of the size of your deposit base, but.

Speaker Change: Is there any risk in your mind that maybe Canadians are just a bit more demanding coming out of this rapidly hiking cycle that we had and perhaps the demand accounts of the free money. That's been 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 that in terms of the funding side.

Raymond Chun: And perhaps the demand accounts, the free money that's been available to fund your lending just isn't going to come back in any sort of meaningful way. That's what I'm sort of getting at in terms of the funding side. I would say at this point, I'm not seeing anything that would show us that there's a difference on that question.

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

Unknown Executive: What I would say is that, again, from an acquisition standpoint, consumers are actually picking TD to do their day-to-day banking. We're seeing increased deposits overall, and we will 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: 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 and an overall.

Speaker Change: And we will see is the 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 Grommets: Thank you. The next question is from many Grommets from Scotiabank. Please go ahead.

Riaz E. 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.

Speaker Change:

Speaker Change: Hi, good morning.

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

Grommets: Performance by geography, Canada versus the U S and.

Speaker Change: Different trends if you look at.

Speaker Change: <unk>.

Speaker Change:

Speaker Change: Between those geographies.

Speaker Change: Yeah. Thanks, many three <expletive>.

Riaz E. 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 is really coming from almost all areas in investment banking as well as in syndicated leveraged finance, transaction banking, as well as trade. And I was particularly encouraged that 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, Good afternoon, ladies and gentlemen, welcome to the social media tech conference, and thank you. But look, as we continue to grow the wholesale segment, a large part of that growth is going to be based in the US just because of the size of the relative market.

Speaker Change: Look I think overall and you kind of look at the revenue production this quarter at a 1 billion a.

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 it's 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 last quarter I mentioned that we had our 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: Become 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 continued 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 their relative markets.

Riaz E. 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, et cetera. 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 revenue differences might 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 in liquidity funding et cetera, but I kind of look at the overall production and I feel pretty good about it.

Speaker Change: Mmm, just maybe ask a follow up question on there or something if I look at the.

Riaz E. Ahmed: Just to maybe ask a follow-up question on this, if I look at the quarterly growth in revenue in wholesale banking, are we seeing similar growth rates between Canada and the U.S.? I think 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. Thank you. Our next question is from Sohrab Movahedi from BMO Capital Markets. Please go ahead.

Speaker Change: Quarter over quarter growth in 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.

Speaker Change: I've seen better days saw better days in Q1 than we did in queue for and that momentum is coming back on both sides of the market.

Speaker Change: Thanks for Ya.

Speaker Change: Thank you.

Speaker Change: The next question is from store on mother heavy from BMO capital markets. Please go ahead. Your line is open.

Unknown Executive: 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. There's probably another plus or minus 300 million restructuring charge next quarter. No, so what we said is that, for Canada, the total charge is going to be, Okay, so last and last year's charge was 363 pre-tax. Okay, thank you. I appreciate that clarification, Bharat. I mean, the good news is I think you've made it clear that the AML issues are understood, and I suppose progress is being made on fixing them.

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

Store: I can kelvin.

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

Store: No. So so what we said is that in the Carlat first.

Store: Of calendar this year.

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

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

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

Speaker Change: 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 attempt to do that as quickly as I'm able.

Speaker Change: Are you in a better position now versus a few quarters ago to give us a sense of.

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 he'll be able to.

Speaker Change: 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 to.

Speaker Change: To improve and enhance our processes and I'm confident that being with the bank many years that when we get onto the.

Speaker Change: Particular issues refined we get onto those and fix them.

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

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

Attempt to do that as quickly as I'm able to.

Bharat B. Masrani: Okay, but you don't think like what the information you're awaiting from Bharat will have? Financial Impact of More Restructuring Charges or Less of their Benefits of the Restructuring Charges Taken to Date, you know, falling to the bottom line, or that will it be due to 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. Well, I think, you know, Kelvin laid out our expense profile for the year at the end of Q4. Kelvin did say that our core expense growth is expected to be these are forecasts, and of course, you know, things can change based on market conditions. Corp.'s increase should be in the 2% range.

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

Speaker Change: <unk> shall impact of more restructuring charges or less upset and.

Speaker Change: <unk> of the restructuring charges taken to date.

Speaker Change: Being you know falling.

Speaker Change: Fall into the bottom lines or <unk>.

Speaker Change: Do you do wonder or is it possible equal.

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

Speaker Change: Laid out before us currency.

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

Speaker Change: <unk>.

Speaker Change: Inquiries should win the 2% range, maybe add on the additional risks in control.

Bharat B. Masrani: If we add on the additional risk and control improvements that we said we would 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.

Speaker Change: Improvements that we said we will undertake that takes 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 you also indicated given is sitting on my left if I'm wrong. Please correct me.

Bharat B. Masrani: If I'm wrong, you know, please correct me, that some of these expenses will be in the corporate segment because we expect those to disappear some time in the future, and some will be for the running of some of these programs will be in the segments, and that will 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. 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: Some of these expenses will mean, the corporate segment, because we expect those to.

Speaker Change: Sometime in the future disappear.

Speaker Change: And.

Speaker Change: And some will be in 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.

Speaker Change: Expenses will be higher by about approximately double than what you've seen in.

Speaker Change: Previous years, so I think that gives you some sense or up I don't think I can give you any more.

Oh, no I appreciate that I I I I appreciate the car I just wanted to make sure that what you had to kind of contemplating what's kind of reflected in here and I guess the rest of it won't come out.

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.

Speaker Change: <unk>. Thank you for taking my questions. Thanks, Thanks very much.

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

Speaker Change: Thank you.

The next question is from Lamar personal from <unk>. Please go ahead. Your line is open.

Lamar: Yeah. Thanks, maybe for <unk> can you talk about some.

Lamar: Some of the actions you've taken in that business the right side of the cost base and then.

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

Lamar: Thanks, Lamar look I think as I mentioned last quarter, we completed the.

Riaz E. Ahmed: 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 markets-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.., the leadership structure fully now announced and in place to lead us to the into the next phase of growth here for for the wholesale bank that I think all of that is allowing us to get to an aspirational efficiency ratio that I mentioned of 66 percent in the last quarter 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 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 bringing 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 to the tax reconciliations that our annual dividend deduction has ranged from about 100 to 125 million dollars a year.

Lamar: Integration of the equity.

Lamar: Equities platform last year, and and and a fair bit of the.

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

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 into.

Lamar: Into the next phase of growth here 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%.

Lamar: And the last quarter so.

Lamar: Today being the eve of the first anniversary of the closing of the acquisition of television Count 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 won't take up to three years, it seems to be going a little bit faster than that so I'm, particularly.

Lamar: Happy about that.

Lamar: And in in just a while we're on the call cause I know our some of our colleagues 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 goes you can see from the notes into financial statements that talk to the tax.

Lamar: Nations that are annual dividend.

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 424.

Riaz E. 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, and just quarterize on that? So that's a reasonable expectation, expectation for? Yeah, I think, 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.

Lamar: Okay, and then moving far Congress should we just taken the chemo on and.

Lamar: <unk> corner I signed that so that's a reasonable expect 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 the business. So yes, I think for your modeling purposes that makes sense to adjusted by that much.

Unknown Executive: I think it's important. The impact to Q1 is only one month out of three months. So, right, right, right. 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.

Lamar: And I think it is important.

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

Lamar: Right right, Okay, and then maybe for Calvin just on this restructuring program. So 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 falling realized cost savings estimates. So maybe you could help me understand how much does this program is going.

Unknown Executive: 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 I like those 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, the savings that are coming out of this restructuring program.

Lamar: You'd be used and kind of three buckets like growth initiatives rectifying AML issues, and then any amount falling to the bottom line I think.

Lamar: 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 slip out between those three buckets that'd be helpful.

Lamar: Yeah.

Speaker Change: So it's it's.

Speaker Change: Maybe the way to talk about is through the numbers.

Speaker Change: Savings that are coming out of this restructuring.

Speaker Change: Program, we expect savings and $400 million.

Unknown Executive: We expect savings of $400 million in 2024... 25.

Speaker Change: Four and $600 million and.

Speaker Change: Twenty-five on an annualized basis.

Unknown Executive: Page 10 of 10, 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, that is, Big Domain Contributor. So although there are, and the residual would be, tribe. 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. So can you... 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: 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 provided for the corporate segment.

Speaker Change: The increase in that is the main contributor would be risks in control. Although there are many puts and takes them.

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

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

Speaker Change: Outside of risk in control.

Speaker Change: I think that fur I guess.

Speaker Change: Can always say, which one do you prioritize because at the end of the day.

Speaker Change: We are.

Speaker Change: Expecting mid single digit expense growth and so can you.

Speaker Change: You say that that is going to drive investment and then the rashes because of the growth and risk in control of the other first we look at it as one portfolio basis that we continue to re prioritize given the environment.

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

Unknown Executive: Thank you. The next question is from Darko Mihelic from RBC Capital Markets. Please go ahead.

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.

Darko Mihelic: Hi, Thank you for taking my questions I know, it's very long really quickly to questions <unk> first one.

Leovigildo 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.

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

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

Darko Mihelic: 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.

Darko Mihelic: Bank clearly has lots of capital are you actually aiming for above industry average kind of growth levels.

Darko Mihelic: On the loan sorry, that's my first question.

Leovigildo 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: Great darker. Thank you very very much for that question. Let me. Let me just give you a sense versed at a macro level and then I'll I'll look at it within the bank.

Speaker Change: From a macro perspective, just to be clear I do expect there to be moderation in the level of <unk>.

Speaker Change: Asset growth and the market as a whole in fact in fact, we saw that we were pure leading in the quarter in the first quarter.

Leovigildo 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 underpenetrated in terms of our consumer lending. 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: So to the extent that rates stay longer and to the extent that there's more pressure on consumers.

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

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

Speaker Change: On that on that subset of consumers.

Speaker Change: To the extent that we can bring.

Speaker Change: Mortgage products, and obviously continue to grow 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 <unk>.

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

Leovigildo 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've done over the past three or four quarters.

Speaker Change: Our aspiration is to double that so.

Speaker Change: Will give us to the extent that we lean into the honest opportunity 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.

Leovigildo 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: That really goes to what we're doing the consumer side.

Speaker Change: Likewise on the commercial side, you saw supposed relatively strong growth and I would say the partnership with TD Cowan Ntt's Securities is at the heart of that the work that we're doing to redefine our mid market franchise.

Speaker Change: Hand in hand with re 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 challenges. While we are in a much stronger position is giving us an ability to be selective and be able to support clients.

Leovigildo 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, and 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: Through this sort of macro environment, so long winded way of saying.

Speaker Change: I do believe that will be able to outperform from from a lending perspective in the short term, but we're gonna do that prudently, we're gonna do that with respect our underwriting criteria, we will make sure that we're putting on good effective.

Speaker Change: But I do think we should be able to outperform the market.

Speaker Change: Okay. Thank you that's actually very helpful I'm sorry.

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

Leovigildo 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 I don't imagine these would be high-spread but possibly high PCL.

Speaker Change: Today, you announced a three year U S 20 billion dollar community impact plan, yes. So.

Speaker Change: 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.

Speaker Change: I don't imagine needs to be high spread, but possibly hi, PCL I mean, how how should I think about this plan and what I should be doing with my model having heard this today.

Leovigildo 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'd be useful. 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 and the Consumer Credit Act, to make those investments, and we have been for some time.

Speaker Change: Darker.

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

Darker: TB made this announcement so just to define what it is first of all because I think it would be useful.

So the $21 billion is really comprised of three lending categories that $10 billion of that is mortgage lending to LMI consumers.

Darker: RSA in in LMI communities. Another $3 billion is to minority led small businesses right across our footprint and the final piece of $7 billion too.

Darker: Ah Ah development financing to affordable housing programs.

Speaker Change: I just want to remind everyone that.

Speaker Change: 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 and a couple of categories to make sure that we are we are supporting our communities. It's fundamental to who we are it's been part of our.

Leovigildo Salom: I think what this program does is lean in a little harder on 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, so 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 it is meant to be even more deliberate with regard to our fair lending and our CRA obligations.

Speaker Change: Core culture so.

Speaker Change: 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.

Speaker Change: At R and R CRA obligations.

Leovigildo Salom: And these are all on the Balance Sheet, correct? Yes, sir. Okay, thank you.

Speaker Change: And these are all on balance sheet correct.

Speaker Change: Ah, yes, Sir okay.

Speaker Change: Okay. Thank you.

Bharat B. Masrani: Thank you. There are no further questions registered at this time. I will turn the call back to Bharat.

Speaker Change: Thank you is there are no further questions registered at this time.

Speaker Change: Back to me.

Bharat B. Masrani: Thanks very much. Just, Darko, just to clarify on this, you know, on the mortgage side, there are times when, if they're conforming mortgages, 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. But just to clarify that, because, you know, it's a particular feature of the U.S. market that sometimes is not well understood.

Speaker Change: Okay. Thanks, very much just dark logistical clarify on the on the.

Speaker Change: Mortgage site, there are times, when they're conforming mortgages.

Speaker Change: Transfer them to Fannie and Freddie and so you know to try and take the dollar for dollar into this sort of on the balance sheet.

Speaker Change: Probably more of we should provide you with more.

Speaker Change: Sort of explanation on that you know.

Speaker Change: Future date, with just to clarify that because you know.

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

Bharat B. Masrani: 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 noticed it was Mr. Wiggin. The rest of us go by first names.

Speaker Change: But overall you know I'm.

Speaker Change: 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.

Speaker Change: Good loan growth in the U S. P. The security's Debeak island, coming together and I would add my congratulations to our colleagues in the wholesale bank today is.

Speaker Change: A major major milestones so it's great great that we've come so far and of course.

Speaker Change: I know this is Mister wigand, the rest of US will by first names [laughter], Tim great Great to have you on this call as well so with that I would also take this opportunity to thank God 95000 bankers around the world. They are the ones, who deliver for all our stakeholders, including our shareholders.

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.

Bharat B. Masrani: So 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 and we will see you next quarter, thanks very much.

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