Q3 2025 Toronto-Dominion Bank Earnings Call

But the key group Q3, 2025 earnings conference call.

I'd now like to turn the meeting over to MS Brook Hills head of Investor Relations.

Please go ahead Ms Hills.

Thank you operator, good morning, and welcome to TD Bank group's third quarter 2025 results presentation. There will begin today's presentation with remarks from Raymond James Bank CEO, followed by Leo So I'm, President and CEO TD Bank America's most convenient bank after which Calvin Tran the Bank C F.

We'll present, our third quarter operating results.

I think my wildly chief risk Officer will then offer comments on credit quality after which we will invite questions from prequalified analysts and investors on the phone.

Speaker #1: This conference is being recorded. Cette conférence est enregistrée.

Speaker #2: All participants, please stand by. Your conference is now ready to begin. Good morning, everyone, and welcome to the Toronto-Dominion Bank Group Q3 2025 earnings conference call.

Brooke Hales: All participants, please stand by. Your conference is now ready to begin. Good morning, everyone, and welcome to the TD Bank Group Q3 2025 earnings conference call. I would now like to turn the meeting over to Ms. Brooke Hales, Head of Investor Relations. Please go ahead, Ms. Hales.

Also present today to answer your questions are thrown in meta group head Canadian personal banking, Barbara Hooper group head Canadian business banking, Tim Wiggins Group head.

Speaker #2: I would now like to turn the meeting over to Ms. Brooke Hales, Head of Investor Relations. Please go ahead, Ms. Hales.

President and CEO TD Securities and Paul Clark Senior Executive Vice President wealth management, Please turn to slide two.

Speaker #3: Thank you, operator. Good morning and welcome to TD Bank Group's third quarter 2025 results presentation. We will begin today's presentation with remarks from Raymond Chun, the bank's CEO, followed by Leo Salom, President and CEO of TD Bank, America's Most Convenient Bank, after which Kelvin Tran, the bank's CFO, will present our third quarter operating results.

Brooke Hales: Thank you, Operator. Good morning and welcome to TD Bank Group's third quarter 2025 results presentation. We will begin today's presentation with remarks from Raymond Chun, the bank's CEO, followed by Leo Salom, President and CEO of TD Bank, America's Most Convenient Bank, after which Kelvin Tran, the bank's CFO, will present our third 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. Also present today to answer your questions are Sona Mehta, Group Head, Canadian Personal Banking; Barbara Hooper, Group Head, Canadian Business Banking; Tim Liggin, Group Head, Wholesale Banking and President and CEO, TD Securities; and Paul Clark, Senior Executive Vice President, Wealth Management. Please turn to slide two. Our comments during this call may contain forward-looking statements, which involve assumptions and have inherent risks and uncertainties.

Our comments during this call may contain forward looking statements, which involve assumptions and have inherent risks and uncertainties actual results could differ materially.

Also remind listeners that the bank uses non-GAAP financial measures to arrive at adjusted results. The bank believes that adjusted results provide readers with a better understanding of how management views the bank's performance.

Speaker #3: 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.

Hey, Leo and Kelvin will be referring to adjusted results in their remarks additional information about non-GAAP measures and material factors and assumptions is available in our Q3 2025 report to shareholders.

Speaker #3: Also present today to answer your questions are Sona Mehta, Group Head, Canadian Personal Banking; Barbara Hooper, Group Head, Canadian Business Banking; Tim Ligon, Group Head, Wholesale Banking and President and CEO of TD Securities; and Paul Clark, Senior Executive Vice President, Wealth Management.

With that let me turn the presentation over to Ray thank.

Thank you Bruce and good morning, everyone.

And another strong quarter, which I'm looking forward to discussing in a minute, but first I'd like to share my thoughts on the external environment.

Speaker #3: Please turn to slide two. Our comments during this call may contain forward-looking statements, which involve assumptions and have inherent risks and uncertainties. Actual results could differ materially.

Global trade dynamics continue to be fluid.

Encouraging last week to hear the Prime Minister and President are intensifying their efforts to resolve the ongoing trade challenges.

Brooke Hales: Actual results could differ materially. I would also remind listeners that the bank uses non-GAAP financial measures to arrive at adjusted results. The bank believes that adjusted results provide readers with a better understanding of how management views the bank's performance. Ray, Leo, and Kelvin will be referring to adjusted results in their remarks. Additional information about non-GAAP measures and material factors and assumptions is available in our Q3 2025 report to shareholders. With that, let me turn the presentation over to Ray.

Speaker #3: I would also remind listeners that the bank uses non-GAAP financial measures to arrive at adjusted results. The bank believes that adjusted results provide readers with a better understanding of how management views the bank's performance.

However, there is still much work ahead with cosma or U S. MCA renegotiation set for next year.

While Canadian companies have benefited from that trade agreement.

Speaker #3: Ray, Leo, and Kelvin will be referring to adjusted results in their remarks. Additional information about non-GAAP measures and material factors and assumptions is available in our Q3 2025 report to shareholders.

Trips and especially sector specific tariffs.

Business uncertainty.

Economic distortions with significant impacts to the most exposed sectors.

Despite this the Canadian and U S economies have shown resilience.

Speaker #3: With that, let me turn the presentation over to Ray.

So momentum has slowed.

Speaker #4: Thank you, Brooke, and good morning, everyone. We had another strong quarter, which I'm looking forward to discussing in a minute. But first, I'd like to share my thoughts on the external environment.

Raymond Chun: Thank you, Brooke, and good morning, everyone. We had another strong quarter, which I'm looking forward to discussing in a minute. First, I'd like to share my thoughts on the external environment. Global trade dynamics continue to be fluid. It was encouraging last week to hear the Prime Minister and President are intensifying their efforts to resolve ongoing trade challenges. However, there is still much work ahead with USMCA or CUSMA renegotiations set for next year. While Canadian companies have benefited from that trade agreement, tariffs, and especially sector-specific tariffs, create business uncertainty and economic distortions with significant impacts to the most exposed sectors. Despite this, the Canadian and U.S. economies have shown resilience, though momentum has slowed. These remain early days. It will likely be a long road before the full impact of tariffs is well understood.

These remain early days it will likely be a long road before the full impact of tariffs as well understood.

This is a time for bold decisive leadership that unlocks Canada's economic potential and strengthens our productivity and resilience.

Speaker #4: Global trade dynamics continue to be fluid, it was encouraging last week to hear the Prime Minister and President are intensifying their efforts to resolve ongoing trade challenges.

Encouraged by the federal government's focus on removing internal trade barriers catalyzing major projects in partnership with with indigenous peoples and diversifying export markets.

Speaker #4: However, there is still much work ahead, with Kuzma, or USMCA, renegotiations set for next year, while Canadian companies have benefited from that trade agreement, tariffs in especially sector-specific tariffs create business uncertainty, and economic distortions with significant impacts to the most exposed sectors.

This moment has an opportunity to build stronger more resilient economies.

At TD, we stand ready to meet that moment, and working with governments and private sector to strengthen communities across our footprint.

Speaker #4: Despite this, the Canadian and US economies have shown resilience. Though momentum has slowed. These remain early days, it will likely be a long road before the full impact of tariffs is well understood.

And no matter, how the external environment evolves, we will be there to support our clients.

As a privilege to serve over 28 million households, and businesses and we will continue working hard every day to understand their needs and help them achieve their goals with that let's turn to the next slide.

Speaker #4: This is a time for bold, decisive leadership that unlocks Canada's economic potential and strengthens our productivity and resilience. I'm encouraged by the federal government's focus on removing internal trade barriers, catalyzing major projects in partnership with Indigenous peoples, and diversifying export markets.

Raymond Chun: This is a time for bold, decisive leadership that unlocks Canada's economic potential and strengthens our productivity and resilience. I'm encouraged by the federal government's focus on removing internal trade barriers, catalyzing major projects in partnership with Indigenous peoples, and diversifying export markets. This moment is an opportunity to build stronger, more resilient economies. At TD, we stand ready to meet that moment and work with governments and private sectors to strengthen communities across our footprint. No matter how the external environment evolves, we'll be there to support our clients. It's a privilege to serve over 28 million households and businesses, and we will continue working hard every day to understand their needs and help them achieve their goals. With that, let's turn to the next slide. With three quarters of the year done, I am pleased with what we have achieved.

With three quarters of the year done I am pleased with what we have achieved we continued to act decisively to support Td's future.

Our momentum continued this quarter.

With previous announcements of a strategic relationship between <unk> and <unk> merchant solutions.

Speaker #4: This moment is an opportunity to build stronger, more resilient economies. At TD, we stand ready to meet that moment and work with governments and the private sector to strengthen communities across our footprint.

This will simplify td's portfolio and reduce costs, improving the bank's financial performance over time.

It will also elevate the experience for our Canadian business banking clients delivering best in class solutions.

Speaker #4: And no matter how the external environment evolves, we'll be there to support our clients. It's a privilege to serve over 28 million households and businesses, and we will continue working hard every day to understand their needs and help them achieve their goals.

We have continued to identify opportunities to innovate to drive efficiency and operational excellence.

Kelvin will provide more details on our efforts to structurally reduce cost across the bank in his remarks.

Speaker #4: With that, let's turn to the next slide. With three quarters of the year done, I am pleased with what we have achieved. We continue to act decisively, to support TD's future.

As you know the bank will host an Investor day on September 29.

We are very excited to share with TD strategy and medium term outlook with all of you next month.

Raymond Chun: We continue to act decisively to support TD's future. Our momentum continued this quarter with TD's announcement of a strategic relationship between Fiserv and TD Merchant Solutions. This will simplify TD's portfolio and reduce costs, improving the bank's financial performance over time. It will also elevate the experience for our Canadian business banking clients, delivering best-in-class solutions. We have continued to identify opportunities to innovate, to drive efficiency and operational excellence. Kelvin will provide more details on our efforts to structurally reduce costs across the bank in his remarks. As you know, the bank will host an Investor Day on September 29th. We are very excited to share TD's strategy and medium-term outlook with all of you next month. Before I turn to Q3 results, I wanted to personally thank Alan McGibbon for his leadership and dedication to the bank.

Before I turn to Q3 results I wanted to personally thank Alan Mckim for his leadership and dedication to the bank.

Speaker #4: Our momentum continued this quarter, with TD's announcement of a strategic relationship between FISERV and TD Merchant Solutions. This will simplify TD's portfolio and reduce costs.

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Ah greatly benefit us.

His many contributions and keen insights.

Speaker #4: Improving the bank's financial performance over time will also elevate the experience for our Canadian business banking clients, delivering best-in-class solutions. We have continued to identify opportunities to innovate, drive efficiency, and achieve operational excellence.

Also want to congratulate Don Mcintire will become the chair of <unk> Board of directors effective Monday.

John's deep financial expertise will help and guide our board in the coming years.

We'll continue to be invaluable to me and my leadership team as we work to deliver on our strategy and drive long term value.

Speaker #4: Kelvin will provide more details on our efforts to structurally reduce costs across the bank in his remarks. As you know, the bank will host an investor day on September 29th.

Please turn to slide four.

In Q3, the bank delivered a strong quarter with earnings of $3 9 billion and EPS of $2 20.

Speaker #4: We are very excited to share TD's strategy and medium-term outlook with all of you next month. Before I turn to Q3 results, I wanted to personally thank Alan McGibbon for his leadership and dedication to the bank.

We saw robust fee and trading income in our markets driven businesses and volume growth year over year in Canadian personal and commercial banking.

TD delivered positive operating leverage this quarter, reflecting strong revenue growth that offset elevated expenses, driven by governance and control costs and investments to drive business growth.

Speaker #4: TD and I have greatly benefited from his many contributions and keen insights. I also want to congratulate John McIntyre, who will become the Chair of TD's Board of Directors effective Monday.

Raymond Chun: TD and I have greatly benefited from his many contributions and keen insights. I also want to congratulate John MacIntyre, who will become the Chair of TD's Board of Directors effective Monday. John's deep financial expertise will help him guide our board in the coming years. He will continue to be invaluable to me and my leadership team as we work to deliver on our strategy and drive long-term value. Please turn to slide four. In Q3, the bank delivered a strong quarter with earnings of $3.9 billion and EPS of $2.20. We saw robust fee and trading income in our markets-driven businesses and volume growth year over year in Canadian personal and commercial banking. TD delivered positive operating leverage this quarter, reflecting strong revenue growth that offset elevated expenses driven by governance and control costs and investments to drive business growth.

In paper PCC.

Quarter over quarter, reflecting strong credit performance and we added to our performing reserves for policy and trade uncertainty.

Speaker #4: John's deep financial expertise will help him guide our board in the coming years, he will continue to be invaluable to me and my leadership team, as we work to deliver on our strategy and drive long-term value.

Taking a prudent approach with almost $600 million in reserves added year to date.

RJ will share more details shortly in his remarks.

Speaker #4: Please turn to slide four. In Q3, the bank delivered a strong quarter with earnings of $3.9 billion, an EPS of $2.20. We saw robust fee and trading income in our markets-driven businesses, and volume growth year-over-year in Canadian personal and commercial banking.

The bank's Q3, CET, one ratio was $14 eight 8%.

Reflecting strong capital generation in the quarter.

As of quarter end, we were over halfway through our share buyback with 46 million shares repurchased for a total of over $4 billion Canadian.

Speaker #4: TD delivered positive operating leverage this quarter, reflecting strong revenue growth that offset elevated expenses driven by governance and control costs, and investments to drive business growth.

Please turn to slide five.

In Q3, we demonstrated disciplined execution across our businesses and.

In Canadian personal and commercial banking, we delivered a strong quarter with record revenue earnings deposits and loan volumes.

Speaker #4: Impaired PCLs decreased quarter over quarter, reflecting strong credit performance, and we added to our performing reserves for policy and trade uncertainty. Taking a prudent approach with almost $600 million in reserves added year to date.

Raymond Chun: Impaired PCLs decreased quarter over quarter, reflecting strong credit performance, and we added to our performing reserves for policy and trade uncertainty, taking a prudent approach with almost $600 million in reserves added year to date. Ajai Bambawale will share more details shortly in his remarks. The bank's Q3 CET1 ratio was 14.8%, reflecting strong capital generation in the quarter. As of quarter end, we were over halfway through our share buyback with 46 million shares repurchased for a total of over $4 billion Canadian dollars. Please turn to slide five. In Q3, we demonstrated disciplined execution across our businesses. In Canadian personal and commercial banking, we delivered a strong quarter with record revenue, earnings, deposits, and loan volumes. Reservoir volumes surpassed $400 billion, driven by strong performance across our distribution channels. We continue to deliver robust loan growth in credit cards.

Little volumes surpassed $400 billion, driven by strong performance across our distribution channels.

We continued to deliver robust loan growth in cards and this quarter cards acquisition was the highest its been in almost a decade.

Speaker #4: Ajai will share more details shortly in his remarks. The bank's Q3 CET-1 ratio was 14.8 percent, reflecting strong capital generation in the quarter, as of quarter end, we were over halfway through our share buyback with 46 million shares repurchased for a total of over $4 billion Canadian dollars.

And the business banking loans were up 6% year over year, reflecting growth across our commercial business. We also saw record retail originations and TD auto finance.

We delivered continued momentum in U S retail with core loans up 2% year over year.

Speaker #4: Please turn to slide five. In Q3, we demonstrated disciplined execution across our businesses. In Canadian personal and commercial banking, we delivered a strong quarter with record revenue, earnings, deposits, and loan volumes.

U S Bank card balances were up 12% year over year, reaching a new milestone with $3 billion imbalances.

In our U S wealth business total client assets were up 12% year over year with mass affluent client assets up 26% year over year.

Speaker #4: Reso volumes surpassed $400 billion, driven by strong performance across our distribution channels. We continue to deliver robust loan growth in cards, and this quarter, cards acquisition was the highest it's been in almost a decade.

This quarter, we made significant progress on our U S balance sheet restructuring.

We completed the investment portfolio repositioning announced last October.

Raymond Chun: In this quarter, credit cards acquisition was the highest it's been in almost a decade. In the business bank, loans are up 6% year over year, reflecting growth across our commercial business. We also saw record retail originations in TD Auto Finance Canada. We delivered continued momentum in U.S. retail with core loans up 2% year over year. U.S. bank card balances were up 12% year over year, reaching a new milestone with $3 billion U.S. dollars in balances. In our U.S. wealth business, total client assets were up 12% year over year, with mass affluent client assets up 26% year over year. This quarter, we made significant progress on our U.S. balance sheet restructuring. We completed the investment portfolio repositioning announced last October and achieved our targeted 10% asset reduction. The bank also continued to prioritize and execute on our AML remediation.

And achieved our targeted 10% asset reduction.

Speaker #4: In the business bank, loans were up 6 percent year-over-year, reflecting growth across our commercial business. We also saw record retail originations in TD Auto Finance.

The bank also continued to prioritize and execute on our AML remediation.

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In wealth management and insurance, we delivered a record earnings and assets in wealth and strong underlying business performance in insurance.

Speaker #4: We delivered continued momentum in US retail with core loans up 2 percent year-over-year. US bank card balances were up 12 percent year-over-year, reaching a new milestone with $3 billion US dollars in balances.

TD asset management, one key institutional mandates globally and domestically and continued to take share in its growing growing ETF franchise.

Speaker #4: In our US wealth business, total client assets were up 12 percent year-over-year, with mass affluent client assets up 26 percent year-over-year. This quarter, we made significant progress on our US balance sheet restructuring.

We had a strong quarter in direct investing with trades per day up 18% year over year as we continued to gain traction in partial shares in our active trader platform.

TD insurance delivered strong premium growth year over year and continue to enhance his client acquisition strategies.

Speaker #4: We completed the investment portfolio repositioning announced last October, and achieved our targeted 10 percent asset reduction. The bank also continued to prioritize and execute on our AML remediation.

In wholesale banking, we continued to demonstrate the power of our broader platform delivering over $2 billion in revenue for the third consecutive quarter.

Speaker #4: Leo will provide more details in his remarks. In wealth management and insurance, we delivered record earnings and assets in wealth, and strong underlying business performance in insurance.

Raymond Chun: Leo will provide more details in his remarks. In wealth management and insurance, we delivered record earnings and assets in wealth and strong underlying business performance in insurance. TD Asset Management won key institutional mandates globally and domestically and continued to take share in its growing ETF franchise. We had a strong quarter in direct investing with trades per day up 18% year over year as we continued to gain traction in partial shares and our active trader platform. TD Insurance delivered strong premium growth year over year and continued to enhance its client acquisition strategies. In wholesale banking, we continue to demonstrate the power of our broader platform, delivering over $2 billion in revenue for the third consecutive quarter. We are seeing broad-based revenue growth as market volatility normalizes and our capital markets and advisory businesses accelerate. Please turn to slide six.

We are seeing broad based revenue growth as market volatility normalizes, and our capital markets and advisory businesses accelerate please turn to slide six.

Speaker #4: TD Asset Management won key institutional mandates globally and domestically and continued to take share in its growing ETF franchise. We had a strong quarter in direct investing, with trades per day up 18 percent year-over-year, as we continue to gain traction in partial shares and our active trader platform.

This quarter, we launched TD AI prism, a significant step forward in our effort to harness the power of AI.

TD AI prism is designed to deliver greater client personalization through accelerated AI, driven insights and support client services and growth.

And in TD Securities, we launched a virtual AI assistant, which queries are equity research Levered library and synthesizers about 8500 proprietary research reports covering nearly 1300 companies in seconds.

Speaker #4: TD Insurance delivered strong premium growth year-over-year and continued to enhance its client acquisition strategies. In wholesale banking, we continue to demonstrate the power of our broader platform, delivering over $2 billion in revenue for the third consecutive quarter.

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Office institutional sales trading and research professionals.

Speaker #4: We are seeing broad-based revenue growth, as market volatility normalizes, and our capital markets and advisory businesses accelerate. Please turn to slide six. This quarter, we launched TD AI Prism, a significant step forward in our effort to harness the power of AI.

Enabling them to answer client inquiries with speed.

We continue to invest in enabling capabilities, such as trusted data and AI.

Raymond Chun: This quarter, we launched TD AI Prism, a significant step forward in our effort to harness the power of AI. TD AI Prism is designed to deliver greater client personalization through accelerated AI-driven insights and support client services and growth. In TD Securities, we launched a virtual AI assistant which queries our equity research library and synthesizes about 8,500 proprietary research reports covering nearly 1,300 companies in seconds. This tool enhances the productivity and effectiveness of our front office institutional sales, trading, and research professionals, enabling them to answer client inquiries with speed. We continue to invest in enabling capabilities such as trusted data and AI. We recognize that leadership in digital and mobile is absolutely critical. We're looking forward to sharing more about our strategies and investments in these areas at our Investor Day next month. Please turn to slide seven.

We recognize that leadership in digital and mobile is absolutely critical.

Speaker #4: TD AI Prism is designed to deliver greater client personalization through accelerated AI-driven insights and support client services and growth. In TD Securities, we launched a virtual AI assistant that queries our equity research lab library and synthesizes about 8,500 proprietary research reports.

We're looking forward to sharing more about our strategies and investments in these areas at our Investor Day next month.

Please turn to slide seven.

So before I turn it over to Leo I want to thank our colleagues across the bank everyday you are working to deliver for our clients drive shareholder value and build td's future. Thank you for all that you do with that over to you.

Speaker #4: Covering nearly 1,300 companies, in seconds. This tool enhances the productivity and effectiveness of our front office institutional sales, trading, and research professionals. Enabling them to answer client inquiries with speed.

Ray and good morning, everyone. Please turn to slide eight we have continued to make progress on our top priority. The U S. AML remediation program and we've now completed a series of important milestones.

Speaker #4: We continue to invest in enabling capabilities such as trusted data and AI. We recognize that leadership in digital and mobile is absolutely critical. We are looking forward to sharing more about our strategies and investments in these areas at our investor day next month.

The seat we've implemented tactical risk reduction measures, we've improved our investigative capabilities, we've launched a new transaction monitoring processing platform.

We've deployed all planned scenarios to date on that new environment.

And are prepared to continuously add and make changes to meet emerging risks and trends. This.

Speaker #4: Please turn to slide seven. Before I turn it over to Leo, I want to thank our colleagues across the bank. Every day, you are working to deliver for our clients, drive shareholder value, and build TD's future.

This quarter we.

Raymond Chun: Before I turn it over to Leo, I want to thank our colleagues across the bank. Every day, you are working to deliver for our clients, drive shareholder value, and build TD's future. Thank you for all that you do. With that, Leo, over to you.

We deployed our first machine learning models and our transaction monitoring environment. This tool will continue to improve the effectiveness and efficiency of our program, allowing our AML team to focus their investigative expertise and intelligence.

Speaker #4: Thank you for all that you do. With that, Leo, over to you.

In addition, we built out our governance over new business initiatives, including the establishment of a new financial crimes risk management Subcommittee dedicated to the assessment and oversight of financial crime risks of new business products and services. We have also launched new focus training or the first and.

Speaker #5: Thank you, Ray, and good morning, everyone. Please turn to slide 8. We've continued to make progress on our top priority: the U.S. AML remediation program.

Leo Salom: Thank you, Ray, and good morning, everyone. Please turn to slide eight. We've continued to make progress on our top priority, the U.S. AML remediation program, and we've now completed a series of important milestones. We have a strong AML leadership team in seat. We've implemented tactical risk reduction measures. We've improved our investigative capabilities. We've launched a new transaction monitoring process and platform. We've deployed all planned scenarios to date on that new environment and are prepared to continuously add and make changes to meet emerging risks and trends. This quarter, we deployed our first machine learning models in our transaction monitoring environment. This tool will continue to improve the effectiveness and efficiency of our program, allowing our AML team to focus their investigative expertise and intelligence.

Speaker #5: And we've now completed a series of important milestones. We have a strong AML leadership team in place, we've implemented tactical risk reduction measures, we've improved our investigative capabilities, we've launched a new transaction monitoring process and platform, we've deployed all planned scenarios to date on that new environment, and we are prepared to continuously add and make changes to meet emerging risks and trends.

Lines of defense related to suspicious customer activity associated with certain commercial products and services.

Bold with the targeted role based training and the enhanced bank wide training, which I spoke about in the past we are continuously uplifting and developing the knowledge and capabilities of our colleagues across the bank to be an effective AML risk managers at this point, we are where we thought we would be in our work and continued.

Speaker #5: This quarter, we deployed our first machine learning models in our transaction monitoring environment. This tool will continue to improve the effectiveness and efficiency of our program, allowing our AML team to focus their investigative expertise and intelligence.

We expect that we will complete the majority of our management remediate remediation actions by the end of calendar 2025. However, as we've said before significant work, including important milestones will continue into calendar 2026 and 2027.

Speaker #5: In addition, we've built out our governance over new business initiatives, including the establishment of a new financial crimes risk management subcommittee dedicated to the assessment and oversight of financial crime risk of new business products and services.

Leo Salom: In addition, we built out our governance over new business initiatives, including the establishment of a new Financial Crimes Risk Management Subcommittee dedicated to the assessment and oversight of financial crime risk of new business products and services. We've also launched new focus training for the first and second lines of defense related to suspicious customer activity associated with certain commercial products and services. Coupled with the targeted role-based training and the enhanced bank-wide training, which I spoke about in the past, we are continuously uplifting and developing the knowledge and capabilities of our colleagues across the bank to be effective AML risk managers. At this point, we are where we thought we would be in our work and continue to expect that we will complete the majority of our management remediation actions by the end of calendar 2025.

I want to also clarify and when we say management remediation actions, we're referring to a broad set of actions that we believe need to be completed to strengthen our AML program.

Speaker #5: We've also launched new focus training for the first and second lines of defense related to suspicious customer activity associated with certain commercial products and services.

As we've disclosed in our MDA MD&A. These actions include activities such as design documentation data preparation systems implementation of controls testing and more.

Speaker #5: Coupled with the targeted role-based training and the enhanced bank-wide training, which I spoke about in the past, we are continuously uplifting and developing the knowledge and capabilities of our colleagues across the bank to be an effective AML risk managers.

Finally, as we have noted previously and as customary for remediation of this nature are U S. AML remediation work is subject to ongoing review by the monitor and acceptance by our regulators the Doj and concern now.

Speaker #5: At this point, we are where we thought we would be in our work and continue to expect that we will complete the majority of our management remediation actions by the end of calendar 2025.

Now I'd like to give you an update on our balance sheet restructuring activities. Please turn to slide nine.

Speaker #5: However, as we have said before, significant work, including important milestones, will continue into calendar 2026 and 2027. I want to also clarify that when we say management remediation actions, we're referring to a broad set of actions that we believe need to be completed to strengthen our AML program.

Leo Salom: However, as we have said before, significant work, including important milestones, will continue into calendar 2026 and 2027. I want to also clarify that when we say management remediation actions, we're referring to a broad set of actions that we believe need to be completed to strengthen our AML program. As we've disclosed in our MD&A, these actions include activities such as design, documentation, data preparation, systems, implementation of controls, testing, and more. Finally, as we have noted previously and is customary for remediations of this nature, our U.S. AML remediation work is subject to ongoing review by the monitor and acceptance by our regulators, the DOJ, and FinCEN. Now, I'd like to give you an update on our balance sheet restructuring activities. Please turn to slide nine. As you know, this effort has two critical objectives.

As you know this effort has two critical objectives first to strictly comply with and maintain a buffer to the asset limitation and.

And second to ensure that we can continue to serve our clients and communities as their needs evolve.

Speaker #5: And as we have disclosed in our MDNA, these actions include activities such as design documentation, data preparation, systems implementation of controls, testing, and more.

We made meaningful progress against our objectives. This quarter at the end of the fiscal quarter total assets were U S 386 billion.

Reflecting the deployment of proceeds from the loan sales to pay down bank borrowings I remain confident that we will largely complete the loan sales. We identified last October by the end of the fiscal year and as we continue to focus on simplifying our business, we will be reducing identified.

Speaker #5: Finally, as we have noted previously and as customary for remediations of this nature, our U.S. AML remediation work is subject to ongoing review by the monitor and acceptance by our regulators, including the DOJ and FinCEN.

Additional loans over the course of fiscal 2026 and beyond.

Speaker #5: Now, I'd like to give you an update on our balance sheet restructuring activities. Please turn to slide nine. As you know, this effort has two critical objectives.

With the execution of our loan reductions in pay down of short term borrowings, we expect to modestly exceed the 10% asset reduction we guided to last October.

Speaker #5: First, to strictly comply with and maintain a buffer to the asset limitation, and second, to ensure that we can continue to serve our clients and communities as their needs evolve.

Leo Salom: First, to strictly comply with and maintain a buffer to the asset limitation, and second, to ensure that we can continue to serve our clients and communities as their needs evolve. We made meaningful progress against our objectives this quarter. At the end of the fiscal quarter, total assets were US$386 billion, reflecting the deployment of proceeds from the loan sales to pay down bank borrowings. I remain confident that we will largely complete the loan sales we identified last October by the end of the fiscal year. As we continue to focus on simplifying our business, we will be reducing identified additional loans over the course of fiscal 2026 and beyond. With the execution of our loan reductions and pay down of short-term borrowings, we expect to modestly exceed the 10% asset reduction we guided to last October. With this asset reduction, the U.S.

With this asset reduction the U S retail segment could grow core loans at a rate consistent with our historical performance through the medium term without breaching the asset limitation and this is without taking into account any incremental capacity that could be created through the sale of up to $40 billion.

Speaker #5: We made meaningful progress against our objectives this quarter. At the end of the fiscal quarter, total assets were $386 billion, reflecting the deployment of proceeds from the loan sales to pay down bank borrowings.

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Speaker #5: I remain confident that we will largely complete the loan sales we identified last October by the end of the fiscal year. As we continue to focus on simplifying our business, we will be reducing additional identified loans over the course of fiscal 2026 and beyond.

This quarter, we completed the investment portfolio repositioning program as well.

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Back in October.

In total we sold approximately $25 billion notional for an upfront loss of $1 3 billion pre tax. These actions are expected to generate an NII benefit in fiscal 2025, approximately $500 million pre tax.

Speaker #5: And with the execution of our loan reductions and pay down of short-term borrowings, we expect to modestly exceed the 10 percent asset reduction we guided to last October.

Collectively these actions have enabled the U S retail segment to improve return on equity excluding schwab by 140 basis points since Q4 of 2024.

Speaker #5: With this asset reduction, the U.S. retail segment could grow core loans at a rate consistent with our historical performance through the medium term, without breaching the asset limitation.

Leo Salom: retail segment could grow core loans at a rate consistent with our historical performance through the medium term without breaching the asset limitation. This is without taking into account any incremental capacity that could be created through the sale of up to $40 billion in non-HQLA securities. This quarter, we completed the investment portfolio repositioning program as well, announced back in October. In total, we sold approximately $25 billion notional for an upfront loss of $1.3 billion pre-tax. These actions are expected to generate an NII benefit in fiscal 2025 of approximately $500 million pre-tax. Collectively, these actions have enabled the U.S. retail segment to improve return on equity, excluding Schwab, by 140 basis points since Q4 of 2024. We expect to continue to improve return on equity through the remainder of fiscal 2025 and into fiscal 2026. With that, I'll turn it over to Kelvin.

We expect to continue to improve return on equity through the remainder of fiscal 2025 and into fiscal 2026.

Speaker #5: And this is without taking into account any incremental capacity that could be created through the sale of up to $40 billion in non-HQLA securities.

With that I'll turn it over to Kelvin.

Thank you Leo please turn to slide 10.

Speaker #5: This quarter, we completed the investment portfolio repositioning program as well, announced back in October. In total, we sold approximately $25 billion notional for an upfront loss of $1.3 billion pre-tax.

TD delivered a strong quarter.

Total bank TTP was up 13% year over year after removing the impact of the U S strategic card portfolio.

FX expenses.

Expenses.

Speaker #5: These actions are expected to generate an NII benefit in fiscal 2025 of approximately $500 million pre-tax. Collectively, these actions have enabled the U.S. retail segment to improve return on equity, excluding Schwab, by 140 basis points since Q4 of 2024.

Revenue grew 10% year over year, driven by higher fee income and trading related revenue and a market driven businesses and volume growth in Canadian personal bank.

<unk>.

Expenses increased 13% year over year with approximately one quarter of the growth driven by variable compensation foreign exchange and the impact of the U S strategic card portfolio.

Speaker #5: We expect to continue to improve return on equity through the remainder of fiscal 2025 and into fiscal 2026. With that, I'll turn it over to Kelvin.

Impaired PCL declined quarter over quarter, reflecting strong credit performance.

Speaker #4: Thank you, Leo. Please turn to slide ten. TD delivered a strong quarter. Total Bank TTPP was up 13 percent year-over-year after removing the impact of the U.S. strategic card portfolio, FX, and insurance service expenses.

Kelvin Tran: Thank you, Leo. Please turn to slide 10. TD delivered a strong quarter. Total bank TTPP was up 13% year over year after removing the impact of the U.S. strategic card portfolio, FX, and insurance service expenses. Revenue grew 10% year over year, driven by higher fee income and trading-related revenue in our markets-driven businesses and volume growth in Canadian personal banking. Expenses increased 13% year over year, with approximately one quarter of the growth driven by variable compensation, foreign exchange, and the impact of the U.S. strategic card portfolio. Impaired PCLs declined quarter over quarter, reflecting strong credit performance. Performing provisions reflect additional overlays for policy and trade uncertainty. Please turn to slide 11. As you know, we are undertaking a restructuring program to reduce structural costs and create capacity to invest to build the bank of the future.

Performing provisions reflect additional overlays for policy and trade uncertainty.

Please turn to slide 11.

As you know.

We are undertaking a restructuring program to reduce structural costs.

And create capacity to invest to build the bank of the future.

Speaker #4: Revenue grew 10 percent year-over-year, driven by higher fee income, trading-related revenue in our markets-driven businesses, and volume growth in Canadian personal and commercial banking.

We expect to incur total restructuring charges of $600 million.

To $700 million pre tax over several quarters.

In Q3, we incurred restructuring charges of $333 million pre tax.

Speaker #4: Expenses increased 13 percent year-over-year, with approximately one quarter of the growth driven by variable compensation, foreign exchange, and the impact of the U.S. strategic card portfolio.

The restructuring program is expected to generate savings of approximately $100 million pre tax in fiscal 2025.

Speaker #4: Impaired PCLs declined quarter over quarter, reflecting strong credit performance. Performing provisions reflect additional overlays for policy and trade uncertainty. Please turn to slide eleven.

And annual run rate savings of $550 million to $650 million pre tax.

Cost savings will be driven by the workforce and real estate optimization.

Asset write offs and businesses wind down.

Speaker #4: As you know, we are undertaking a restructuring program to reduce structural costs and create capacity to invest in building the bank of the future.

As part of the strategic review.

We continue to expect fiscal 2025 expense growth.

Assuming fiscal 2024 levels of variable compensation.

Speaker #4: We expect to incur total restructuring charges of $600 million to $700 million pre-tax over several quarters. In Q3, we incurred restructuring charges of $333 million pre-tax.

Kelvin Tran: We expect to incur total restructuring charges of $600 million to $700 million pre-tax over several quarters. In Q3, we incurred restructuring charges of $333 million pre-tax. The restructuring program is expected to generate savings of approximately $100 million pre-tax in fiscal 2025 and annual run rate savings of $550 million to $650 million pre-tax. Cost savings will be driven by workforce and real estate optimization, asset write-offs, and business wind-downs and exits as part of the strategic review. We continue to expect fiscal 2025 expense growth, assuming fiscal 2024 levels of variable compensation, FX, and the U.S. strategic card portfolio to be at the upper end of the 5% to 7% range, reflecting investments in governance and control and investments supporting business growth, net of expected productivity and restructuring savings.

In the strategic cards portfolio to be at the upper end of the 5% to 7% range.

Reflecting investments in governance and control.

And investments supporting business growth net of expected productivity and restructuring savings.

Speaker #4: The restructuring program is expected to generate savings of approximately $100 million pre-tax in fiscal 2025, and annual run rate savings of $550 million to $650 million pre-tax.

We have delivered strong results year to date.

And we are evaluating opportunities to further accelerate investments in our business to drive future growth.

We look forward to sharing more at our upcoming Investor day.

Speaker #4: Cost savings will be driven by workforce and real estate optimization, asset write-offs, and business wind-downs and exits as part of the strategic review.

Please turn to slide 12.

Okay.

Canadian personal and commercial banking delivered a strong quarter with record revenue earnings deposit.

Speaker #4: We continue to expect fiscal 2025 expense growth, assuming fiscal 2024 levels of variable compensation FX, and the US strategic cards portfolio to be at the upper end of the five to seven percent range, reflecting investments in governance and control and investments supporting business growth, net of expected productivity and restructuring savings.

And loan volume.

Average deposits rose rose, 4% year over year, reflecting 4% growth in personal deposits and 6% growth in business deposits.

Average loan volumes rose, 4% year over year, with 3% growth in personal volumes and 6% growth in business volume.

This quarter housing market activity improved compared to the prior quarter and our <unk> strategy delivered both sequential volume growth.

Speaker #4: We have delivered strong results year-to-date, and we are evaluating opportunities to further accelerate investments in our business to drive future growth. We look forward to sharing more at our upcoming investor day.

Kelvin Tran: We have delivered strong results year to date, and we are evaluating opportunities to further accelerate investments in our business to drive future growth. We look forward to sharing more at our upcoming Investor Day. Please turn to slide 12. Canadian personal and commercial banking delivered a strong quarter with record revenue, earnings, deposits, and loan volume. Average deposits rose 4% year over year, reflecting 4% growth in personal deposits and 6% growth in business deposits. Average loan volumes rose 4% year over year, with 3% growth in personal volumes and 6% growth in business volume. This quarter, housing market activity improved compared to the prior quarter, and our reserve strategy delivered both sequential volume growth and margin expansion in the competitive market. Net interest margin was 2.83%, up one basis point quarter over quarter, primarily driven by higher loan and deposit margins.

Margin expansion in a competitive market.

Net interest margin was 283% up one basis point quarter over quarter, primarily driven by higher loan and deposit margin.

Speaker #4: Please turn to slide twelve. Canadian Personal and Commercial Banking delivered a strong quarter with record revenue, earnings, deposits, and loan volumes. Average deposits growth rose 4% year-over-year, reflecting 4% growth in personal deposits and 6% growth in business deposits.

As we look forward to Q4, we again expect NIM to be relatively stable.

Expenses increased reflecting higher technology spend and other operating expenses.

Please turn to slide 13.

Speaker #4: Average loan volumes rose 4 percent year-over-year, with 3 percent growth in personal volumes and 6 percent growth in business volumes. This quarter, housing market activity improved compared to the prior quarter, and our reso strategy delivered both sequential volume growth and margin expansion in the competitive market.

U S retail sustained business momentum and maintenance.

Progress on balance sheet restructuring.

Deposits, excluding suites were stable year over year.

And we're up 2% excluding targeted runoff in our government banking business.

All loans grew 2% year over year, reflecting continued strength in bankcard home equity middle market and small business.

Speaker #4: Net interest margin was 2.83 percent, up one basis point quarter over quarter, primarily driven by higher loan and deposit margins. As we look forward to Q4, we again expect NIM to be relatively stable.

Net interest margin was 319%.

15 basis points quarter over quarter.

Kelvin Tran: As we look forward to Q4, we again expect NIM to be relatively stable. Expenses increased, reflecting higher technology spend and other operating expenses. Please turn to slide 13. U.S. retail sustained business momentum and made significant progress on balance sheet restructuring. Deposits, excluding sweeps, were stable year over year and were up 2%, excluding targeted run-off in our government banking business. Core loans grew 2% year over year, reflecting continued strength in bank card, home equity, middle market, and small business. Net interest margin was 3.19%, up 15 basis points quarter over quarter, reflecting the impact of U.S. balance sheet restructuring activities, normalization of elevated liquidity levels, and higher deposit margins. As we look forward to Q4, we expect NIM to moderately expand. Expenses increased $199 million U.S. or 13% year over year, reflecting higher governance and control investments, including costs of $157 million U.S. for U.S.

Flatting the impact of U S balance sheet restructuring activities normalization of elevated liquidity levels and higher deposit margins.

Speaker #4: Expenses increased, reflecting higher technology spend and other operating expenses. Please turn to slide thirteen. U.S. retail sustained business momentum and made significant progress on balance sheet restructuring.

As we look forward to Q4, we expect NIM to moderately expand.

Expenses increased $199 million.

Speaker #4: Deposits excluding sweeps were stable year-over-year, and were up 2 percent excluding targeted runoff in our government banking business. Core loans grew 2 percent year-over-year, reflecting continued strength in bank card, home equity, middle market, and small business.

Or 13% year over year, reflecting higher governance and control investments including cost.

$57 million in U S, but U S BSA AML remediation this quarter.

Hi.

It expenses.

While investments will fluctuate from quarter to quarter, we continue to expect U S. BSA, AML remediation and related governance and control investments of approximately $500 million.

Speaker #4: Net interest margin was 3.19%, up 15 basis points quarter over quarter, reflecting the impact of U.S. balance sheet restructuring activities, normalization of elevated liquidity levels, and higher deposit margins.

Pre tax and fiscal 2025.

We expect similar investments in fiscal 2020.

Overall U S retail expense growth is expected to be in the mid single digit range in fiscal 2020.

Speaker #4: As we look forward to Q4, we expect NIM to moderately expand. Expenses increased $199 million, or 13 percent year-over-year, reflecting higher governance and control investments, including costs of $157 million for U.S. PSA AML remediation this quarter, and higher employee-related expenses.

We remain focused on our productivity initiatives to help fund investments in our core franchise.

Please turn to slide 14.

Wealth management and insurance delivered strong underlying business performance.

Kelvin Tran: BSA AML remediation this quarter and higher employee-related expenses. While investments will fluctuate from quarter to quarter, we continue to expect U.S. BSA AML remediation and related governance and control investments of approximately $500 million U.S. pre-tax in fiscal 2025. We expect similar investments in fiscal 2026. Overall, U.S. retail expense growth is expected to be in the mid-single-digit range in fiscal 2024. We remain focused on productivity initiatives to help fund investments in our core franchise. Please turn to slide 14. Wealth management and insurance delivered strong underlying business performance. In wealth management, market appreciation coupled with strong account origination drove record assets this quarter. Direct investing had a particularly strong quarter. We saw a significant increase in trading volumes led by our active trader clients with volumes up 23% year over year and increased deposits. We have continued to invest in our insurance business.

In wealth management market appreciation, coupled with strong account origination drove record assets this quarter.

Speaker #4: While investments will fluctuate from quarter to quarter, we continue to expect U.S. PSA AML remediation and related governance and control investments of approximately $500 million pre-tax in fiscal 2025. We expect similar investments in fiscal 2026.

Direct investing had a particularly strong quarter.

We saw a significant increase in trading volumes led by our active trader clients with volumes up 23% year over year and increased deposits.

We have continued to invest in our insurance business.

Speaker #4: Overall, U.S. retail expense growth is expected to be in the mid-single-digit range in fiscal 2026. We remain focused on productivity initiatives to help fund investments in our core franchise.

This quarter, while lower cat activity provided a benefit the performance underscores the strength of our business and the ability to deliver profitable growth.

Expenses increased this quarter, reflecting higher variable compensation.

Speaker #4: Please turn to slide fourteen. Wealth management and insurance delivered strong underlying business performance. In wealth management, market appreciation coupled with strong account origination drove record assets this quarter.

Answering with higher revenues and increased technology investments.

Please turn to slide 15.

Wholesale banking delivered a strong quarter driven by broad based revenue growth across global markets, and corporate and investment banking and our pipeline of future deals remains robust.

Speaker #4: Direct investing had a particularly strong quarter. We saw a significant increase in trading volumes, led by our active trader clients with volumes up 23 percent year-over-year, and increased deposits.

We continue to demonstrate the industrial logic of the TD Cowen acquisition.

Yes.

<unk> expenses increased reflecting higher technology front office costs variable compensation and spanned supporting regulatory and business projects.

Speaker #4: We have continued to invest in our insurance business. This quarter, while lower-cap activity provided a benefit, the performance underscores the strength of our business and our ability to deliver profitable growth.

Kelvin Tran: This quarter, while lower CAT activity provided a benefit, the performance underscores the strength of our business and ability to deliver profitable growth. Expenses increased this quarter, reflecting higher variable compensation commensurate with higher revenues and increased technology investments. Please turn to slide 15. Wholesale banking delivered a strong quarter driven by broad-based revenue growth across global markets and corporate and investment banking, and our pipeline of future deals remains robust. We continue to demonstrate the industrial logic of the TD Cowen acquisition. Expenses increased, reflecting higher technology, front office costs, variable compensation, and spend supporting regulatory and business projects. Please turn to slide 16. Corporate net loss for the quarter was $164 million, a smaller loss than the same quarter last year, reflecting higher revenue from treasury and balance sheet activities, partially offset by higher net corporate expenses, which were primarily driven by higher governance and control costs.

Please turn to slide 16.

Corporate net loss for the quarter was $164 million.

Speaker #4: Expenses increased this quarter, reflecting higher variable compensation, commensurate with higher revenues and increased technology investments. Please turn to slide fifteen. Wholesale banking delivered a strong quarter driven by broad-based revenue growth across global markets, and corporate and investment banking, and our pipeline of future deals remains robust.

Smaller loss than the same quarter last year, reflecting higher revenue from treasury and balance sheet activities, partially offset by higher net corporate expenses, which were primarily driven by higher governance and control costs.

Please turn to slide 17.

The common equity tier one ratio ended the quarter at 14, 8% down five basis points sequentially.

Speaker #4: We continue to demonstrate the industrial logic of the TD Calvin acquisition. Expenses increased, reflecting higher technology front-office costs, variable compensation, and spend supporting regulatory and business projects.

We delivered strong internal capital generation this quarter.

Bank repurchased 16 million common shares under its share buyback program in Q3, which reduced <unk> by 25 basis points.

Speaker #4: Please turn to slide sixteen. Corporate net loss for the quarter was $164 million, a smaller loss than the same quarter last year, reflecting higher revenue from treasury and balance sheet activities, partially offset by higher net corporate expenses.

Our average LCR for the quarter was 138% the bank is now operating at normalized liquidity levels.

With that RJ over to you. Thank you Kelvin and good morning, everyone.

Please turn to slide 18.

Gross impaired loan formations were 26 basis points, an increase of five basis points or $402 million quarter over quarter.

Speaker #4: Which were primarily driven by higher governance and control costs. Please turn to slide seventeen. The Common Equity Tier One ratio ended the quarter at 14.8%, down five basis points sequentially.

Kelvin Tran: Please turn to slide 17. The common equity tier one ratio ended the quarter at 14.8%, down 5 basis points sequentially. We delivered strong internal capital generation this quarter. The bank repurchased 16 million common shares under its share buyback program in Q3, which reduced CET1 by 25 basis points. Our average LCR for the quarter was 138%. The bank is now operating at normalized liquidity levels. With that, Ajai, over to you.

The increase was largely recorded in the wholesale banking and U S commercial lending portfolios related to a small number of borrowers across a number of industries.

Speaker #4: We delivered strong internal capital generation this quarter. The bank repurchased 16 million common shares under its share buyback program in Q3, which reduced CET1 by 25 basis points.

Please turn to slide 19.

Gross impaired loans increased $468 million quarter over quarter.

Speaker #4: Our average Liquidity Coverage Ratio (LCR) for the quarter was 138 percent. The bank is now operating at normalized liquidity levels. With that, Ajai, over to you.

<unk>, three 3 billion or 56 basis points.

The increase was largely reflected in the wholesale banking and U S commercial lending portfolios.

Please turn to slide 20.

Speaker #6: Thank you, Kelvin, and good morning, everyone. Please turn to slide 18. Gross impaired loan formations were 26 basis points, an increase of 5 basis points, or $420 million quarter over quarter.

Ajai Bambawale: Thank you, Kelvin, and good morning, everyone. Please turn to slide 18. Gross impaired loan formations were 26 basis points, an increase of 5 basis points of $402 million quarter over quarter. The increase was largely recorded in the wholesale banking and U.S. commercial lending portfolios related to a small number of borrowers across a number of industries. Please turn to slide 19. Gross impaired loans increased $468 million quarter over quarter to $5.33 billion or 56 basis points. The increase was largely reflected in the wholesale banking and U.S. commercial lending portfolios. 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 PCLs. 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.

Recall that our presentation reports PCL ratios, both gross and net of the partner's share of the U S. Strategic card Pcos, we remind you that the U S card PCL recorded in the corporate segment are fully absorbed by our partners and do not impact the bank's net income.

Speaker #6: The increase was largely recorded in the wholesale banking and U.S. commercial lending portfolios, related to a small number of borrowers across a number of industries.

The bank's provision for credit losses decreased $370 million or 17 basis points quarter over quarter to 41 basis points.

Speaker #6: Please turn to slide nineteen. Gross impaired loans increased $468 million quarter over quarter, to $5.33 billion or 56 basis points. The increase was largely reflected in the wholesale banking and U.S. commercial lending portfolios.

Decrease was recorded broadly across the Canadian and U S consumer.

And business and government lending portfolios and reflective of strong underlying credit performance.

The third quarter.

Quarter performing better.

Speaker #6: Please turn to slide twenty. Recall that our presentation reports PCL ratios, both gross and net, of the partner share of the U.S. strategic card PCLs.

Please turn to slide 21.

Impaired PCL were $904 million, a decrease of $42 million quarter over quarter, driven by the Canadian personal and commercial segments.

Speaker #6: We remind you that US card PCLs recorded in the corporate segment are fully absorbed by our partners and do not impact the bank's net income.

Performing PCL was 67 million.

Kris of 328 million quarter over quarter.

Speaker #6: The bank's provision for credit losses decreased 370 million or 17 basis points quarter over quarter, to 41 basis points. The decrease was recorded broadly, across the Canadian and US consumer, and business and government lending portfolios, and reflective of strong underlying credit performance and a smaller current quarter performing bill.

Ajai Bambawale: The bank's provision for credit losses decreased $370 million or 17 basis points quarter over quarter to 41 basis points. The decrease was recorded broadly across the Canadian and U.S. consumer and business and government lending portfolios and reflective of strong underlying credit performance and a smaller current quarter performing build. Please turn to slide 21. Impaired PCLs were $904 million, a decrease of $42 million quarter over quarter, driven by the Canadian personal and commercial segment. Performing PCL was $67 million, a decrease of $328 million quarter over quarter. The decrease reflects a smaller current quarter build for policy and trade uncertainty. Please turn to slide 22. The allowance for credit losses was $9.7 billion, an increase of $116 million quarter over quarter, reflecting additional performing reserves relating to policy and trade uncertainty and higher impaired allowance associated with a few impairments in the wholesale lending portfolio.

The decrease reflects a smaller current quarter billed for policy and trade uncertainty.

Please turn to slide 22.

The allowance for credit losses was $9 7 billion, an increase of $116 million quarter over quarter.

<unk> additional performing reserves relating to policy and trade uncertainty and higher impaired allowance associated with a few impairments in the wholesale lending portfolio.

Speaker #6: Please turn to slide twenty-one. Impaired PCLs were $940 million a decrease of 42 million quarter over quarter, driven by the Canadian personal and commercial segment.

Now in summary.

Bank exhibited continued strong credit performance this quarter evidenced by a sequential reduction in impaired PCL.

Speaker #6: Performing PCL was $67 million, a decrease of $328 million quarter over quarter. The decrease reflects a smaller current quarter build attributed to policy and trade uncertainty.

While underlying credit performance remains resilient.

We've conducted a further review of our lending portfolios, considering ongoing policy and trade related risks.

Speaker #6: Please turn to slide twenty-two. The allowance for credit losses was 9.7 billion, an increase of $116 million quarter over quarter, reflecting additional performing reserves, relating to policy and trade uncertainty, and higher impaired allowance, associated with a few impairments in the wholesale lending portfolio.

And have added incremental reserves this quarter.

In aggregate our policy and trade related reserves are now approximately $600 million.

And we are prudently reserved for that dynamic economic environment.

While there are many potential scenarios that could play out in terms of the economic trajectory and credit performance.

Speaker #6: Now, in summary, the bank exhibited continued strong credit performance this quarter, evidenced by a sequential reduction in impaired PCLs. While underlying credit performance remains resilient, we've conducted a further review of our lending portfolios, considering ongoing policy and trade-related risks.

Ajai Bambawale: Now, in summary, the bank exhibited continued strong credit performance this quarter, evidenced by a sequential reduction in impaired PCLs. While underlying credit performance remains resilient, we've conducted a further review of our lending portfolios, considering ongoing policy and trade-related risks, and have added incremental reserves this quarter. In aggregate, our policy and trade-related reserves are now approximately $600 million, and we are prudently reserved for the dynamic economic environment. While there are many potential scenarios that could play out in terms of the economic trajectory and credit performance, I expect fiscal 2025 PCL results to fall within the range of 45% to 55% I offered at the start of the year.

I expect fiscal 2025 PCL results to fall within the range of 45 to 55 basis points.

I offered at the start of the year.

Looking forward TD is well positioned to manage through this period of uncertainty considering a prudent provisioning broad diversification across products and geographies, our strong capital position and our through the cycle underwriting standards that have served us well.

Speaker #6: And have added incremental reserves this quarter. In aggregate, our policy and trade-related reserves are now approximately $600 million, and we are prudently reserved for the dynamic economic environment.

Through challenging conditions in the past.

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

Thank you.

Please press star one at this time, if you have a question there will be a brief pause while the participants register.

Speaker #6: While there are many potential scenarios that could play out in terms of the economic trajectory and credit performance, I expect fiscal 2025 PCL results to fall within the range of 45 to 55 basis points, as I offered at the start of the year.

We thank you for your patience.

The first question is from John Aiken from Jefferies.

Okay.

Good morning, Thanks for the update in terms of the ammo and remediation of the balance sheet restructuring question for you, though in your prepared commentary you talked about.

Speaker #6: Looking forward, TD is well-positioned to manage through this period of uncertainty, considering our prudent provisioning, broad diversification across products and geographies, our strong capital position, and our through-the-cycle underwriting standards that have served us well through challenging conditions in the past.

Ajai Bambawale: Looking forward, TD is well positioned to manage through this period of uncertainty, considering our prudent provisioning, broad diversification across products and geographies, our strong capital position, and our through-the-cycle underwriting standards that have served us well through challenging conditions in the past. With that, Operator, we are now ready to begin the Q&A session.

The lending portfolio could grow over the next couple of years without breaching the restriction.

Not putting too fine a point on this but are we expecting to see an inflection point at some point in 2026 and actually start to see the loan balances grow in the U S portfolio.

And John Thanks for the question.

Speaker #6: With that operator, we are now ready to begin the Q&A session.

Just to break it down.

We did provide this disclosure we've already reduced the overall balance sheet by about $17 billion. We've got an additional $18 billion on a spot basis that we've identified for runoff <unk> selective repricing. So that that will be largely the work that we'll be doing over the next few.

Speaker #7: Thank you. Please press *1 at this time if you have a question. There will be a brief pause while all the participants register. We thank you for your patience.

Brooke Hales: Thank you. Please press star one at this time if you have a question. There will be a brief pause while the participants register. We thank you for your patience. The first question is from John Aiken from Jefferies.

Speaker #7: The first question is from John Aiken from Jefferies.

Quarters into 2026.

Speaker #8: Good morning. Leo, thanks for the update in terms of the AML remediation and the balance sheet restructuring. I have a question for you, though. In your prepared commentary, you talked about how the lending portfolio could grow over the next couple of years without breaching the restriction.

John Aiken: Good morning. Leo, thanks for the update in terms of the AML remediation and the balance sheet restructuring. A question for you, though. In your prepared commentary, you talked about the lending portfolio could grow over the next couple of years without breaching the restriction. Not putting too fine a point on this, but are we expecting to see an inflection point at some point in 2026 and actually start to see the loan balances grow in the U.S. portfolio?

I would expect that Youll still see from a headline standpoint that we will see some contraction in most of our.

2026, with an inflection point towards the end of the year.

The areas, where we are experiencing really good strong growth.

Speaker #8: not putting too fine a point on this, but are we expecting to see an inflection point at some point in 2026 and actually start to see the loan balances grow in the US portfolio?

And Kelvin highlighted some of these in our in our bank card business I'm really pleased we've been consistently delivering double digit.

Both in terms of overall credit card proprietary.

Speaker #5: John, thanks for the question. Just to break it down, we, when we did provide this disclosure, we've already reduced the overall balance sheet by about $17 billion.

Leo Salom: John, thanks for the question. Just to break it down, we, and we did provide this disclosure. We've already reduced the overall balance sheet by about $17 billion. We've got an additional $18 billion on a spot basis that we've identified for runoff and/or selective repricing. That will be largely the work that we'll be doing over the next few quarters into 2026. I would expect that you'll still see from a headline standpoint that we'll see some contraction in the book through most of 2026 with an inflection point towards the end of the year. The areas where we are experiencing really good strong growth, and Kelvin highlighted some of these. In our bank card business, I'm really pleased we've been consistently delivering double-digit growth in terms of overall credit card proprietary growth. Likewise, we saw home equity balances grow by 9%, so solid performance there.

<unk>.

Likewise, we saw a home equity balances grow by 9% So solid performance there and even in the commercial segment, which is given the uncertainty in the marketplace has has been experiencing a bit of a wait and see sort of dynamic we're seeing decent growth there small business was up 5% or mid.

Speaker #5: We've got an additional 18 billion dollars on a spot basis that we've identified for runoff and/or selective repricing. So that, that will be largely the work that we'll be doing over the next few quarters into 2026.

Market and specialty businesses were up 6% so.

I think we're seeing the core underlying growth taking place but to your point, we will still have a run off scenario for the for the better part of 2026, as we tried to get to the fighting weight size.

Speaker #5: I would expect that you'll still see from a headline standpoint, that we'll see some contraction in the book through most of, 2026, with an inflection point towards the end of the year.

Speaker #5: the areas where we are experiencing really good strong growth, and Kelvin highlighted some of these, in our, in our bank card business, I'm really pleased we've been consistently delivering double-digit, growth in terms of overall credit card proprietary, growth.

Yes.

Thanks for the clarification I appreciate it.

Thank you. The next question is from Gabriel <unk> from National Bank financial.

Good morning.

First question just a follow up on that one so you have the loans with government.

Speaker #5: likewise, we saw home equity, balances grow by 9 percent, so solid performance there. And even in the commercial segment, which is, given the uncertainty in the marketplace, has, has been experiencing a bit of a wait-and-see sort of dynamic.

In the U S. The exits Runoffs 17 billion to date 18 billion. Thanks to that number are identified for a similar treatment.

Leo Salom: Even in the commercial segment, which is given the uncertainty in the marketplace, has been experiencing a bit of a wait-and-see sort of dynamic. We're seeing decent growth there. Small business was up 5%. Our mid-market and specialty businesses were up 6%. I think we're seeing the core underlying growth taking place. To your point, we'll still have a runoff scenario for the better part of 2026 as we try to get to the fighting weight size for the U.S. business.

Speaker #5: We're seeing decent growth there. Small business was up 5%. Our mid-market and specialty businesses were up 6%. So, I think we're seeing the core underlying growth taking place.

Does that.

Contemplated in the full program as you see it now because.

There's what you do this year and then it sounds like more beyond.

Beyond 2026 or whatever it was this oh.

Speaker #5: But to your point, we'll still have a runoff scenario for the, for the better part of 2026 as we, try to get to the fighting weight size for the US business.

Capturing all of that book.

Thanks for the question Gabe.

I'd say that is the entirety of the program that reflects not only what we announced back in October.

Speaker #7: Thanks for the clarification, Ray. I appreciate it.

John Aiken: Thanks for your clarification, Raymond. I appreciate it.

It also includes the product of the strategic reviews that we've conducted over the past two quarters, Okay, great and then from a <unk>.

Speaker #2: Thank you. The next question is from Gabriel Dussain from National Bank Financial.

Brooke Hales: Thank you. The next question is from Gabriel Deshayne from National Bank Financial.

Modeling standpoint, and I know these aren't all homogeneous portfolios, but when you choose to exit them or we use the ultimate deciding factor, but risk is another so are they use.

Speaker #9: Hey, good morning. First question, just to follow up on that one. So, the loans we're talking about in the U.S., the exits and runoffs, $17 billion to date, $18 billion.

Gabriel Deshayne: Hey, good morning. First question is just to follow up on that one. You've, the loans we're talking about in the U.S., the exits, runoffs, $17 billion to date, $18 billion, thanks for that number, identified for similar treatment. Is that contemplated and is that the full program as you see it now? Because there's what you do this year and then it sounds like more beyond or beyond 2026 or whatever. Is this capturing all that outlook?

And in totality or are these going to cause your margins to go up or down and in your <unk>.

Speaker #9: Thanks for that number. Is that identified for, you know, similar treatment? Is that contemplated, and is that the full program as you see it now?

Your risk to go up or down like just that's just the nature of these portfolios on the correspondent mortgage would probably be low margin low melas, but maybe.

Speaker #9: Because there's what you do this year, and then it sounds like more beyond, or beyond 2026 or whatever. Is this capturing all that outlook?

The rest of the program has different characteristics.

Speaker #5: No, no, thanks for the question, Gabe. I, I'd say that is the entirety of the program. That reflects not only what we announced back in October, Gabe, but it also includes the product of the strategic reviews that we've conducted over the past, two quarters.

That's exactly right I'd say the two primary criteria. One obviously is we looked at portfolios that were not accretive to return on equity and so making sure that.

Leo Salom: Thanks for the question, Gabe. I'd say that is the entirety of the program. That reflects not only what we announced back in October, Gabe, but it also includes the product of the strategic reviews that we've conducted over the past two quarters.

The portfolio is profitable and is hurdling was criteria number one number two was is it is a core to the franchise are they are we lending due to clients that that where we are able to serve them.

Speaker #9: Okay, great. And this from a, you know, modeling standpoint, and I know these aren't all homogeneous portfolios, but, when you choose to exit them, are these, you know, the ultimate deciding factor, but risk is another.

Gabriel Deshayne: Okay, great. Just from a modeling standpoint, I know these aren't all homogeneous portfolios, but when you choose to exit them, ROE is the ultimate deciding factor, but risk is another. Are these going, in totality, to cause your margins to go up or down and then your risk to go up or down? Just the nature of these portfolios. I know the correspondent mortgage would probably be low margin and low loan loss, but maybe the rest of the program has different characteristics.

<unk> as opposed to just a standalone lending relationship and all of the portfolios that we've chosen as part of this exercise fall in that category. Okay.

Speaker #9: So are these going, you know, in, in, in, in totality, are these gonna, you know, cause your margins to go up or down and then your, your, you know, your, your risk, to go up or down, like just the, just the nature of these, these portfolios and all the corresponding mortgage would probably be low margin and low, low loss, but, maybe, the rest of the, the, the program has different characteristics?

Next question is on expenses expense management, so just so I'm crystal clear.

I mean I should know this by now but.

The U S $500 million of AML remediation costs direct stuff that's in the U S. P&C segment correct.

Speaker #5: No, Gabe, that's exactly right. I, I'd say the two primary criteria: one, obviously, is, we looked at portfolios that were not accretive to return on equity, and so, making sure that, the, the portfolio is profitable and is hurdling was criteria number one.

Leo Salom: That's exactly right. I'd say the two primary criteria, one obviously is, we looked at portfolios that were not accretive to return on equity. Making sure that the portfolio is profitable and is hurdling was criteria number one. Number two was, is it core to the franchise? Are we lending to clients where we are able to serve them completely as opposed to just a standalone lending relationship? All the portfolios that we've chosen as part of this exercise fall in that category.

Yes.

My my hopefully more intelligent question.

Are there additional.

Indirect costs that are seemingly.

Seemingly tied to this issue as well because.

Speaker #5: Number two was, is it, is it core to the franchise? Are they, are we lending to, to clients that, that where we are able to serve them, you know, completely as opposed to just a standalone lending relationship?

Wholesale banking I see good revenue growth.

But then the expenses were up more.

Spend to supporting regulatory and business project.

Speaker #5: And, all the portfolios that we've, chosen as part of this exercise fall in that category.

Projects and then in the corporate segment sounds like governance and control costs were.

Speaker #9: Okay. next question is on expenses, expense management. So just so I'm, crystal clear, the, the, I mean, I should know this by now, but, the US 500 million of, AML remediation costs, the direct stuff, that's in the US PNC segment, correct?

Gabriel Deshayne: Okay. Next question is on expenses, expense management. Just so I'm crystal clear, the US $500 million of AML remediation costs, the direct stuff, that's in the U.S. PNC segment, correct?

I'm just wondering if there's additional inflationary pressures that are starting to affect other segments.

Hi, Davis, California, why don't I take that first yes, so overall.

The majority of the year over year expense growth as governance and control related.

You've already know that part of that is in <unk> business and we've also taken this opportunity to uplift our uplift governance and control cross across across the bank.

Speaker #5: That is correct. Yeah.

Leo Salom: That is correct, yeah.

Speaker #9: Okay. I'm, my, my, hopefully more intelligent question is: Are there additional, you know, indirect costs that are seemingly tied to this issue as well?

Gabriel Deshayne: Okay. My hopefully more intelligent question is, are there additional, you know, indirect costs that are, I mean, seemingly tied to this issue as well? Because, I mean, in the wholesale banking, I see, you know, good revenue growth, but then expenses were up more, spend to supporting regulatory and business projects. In the corporate segment, it sounded like governance and control costs were noted. I'm just wondering if there's additional inflationary pressures that are starting to affect other segments.

Where we see feasible.

Speaker #9: Because, I mean, in wholesale banking, I see, you know, good revenue growth, but then expenses were up more. Spend to support regulatory and business projects, and then in the corporate segment, it sounded like governance and control costs were noted.

And so maybe I'll pass it on to <unk> to give you a few examples of those and then Tim on the investment there is making in this business.

I would say with respect to second line risk functions that are under my purview.

The main area, we're investing in is AML, so not just USAA AML, but we're very much investing in enterprise.

Speaker #9: I'm just wondering if there are additional inflationary pressures that are starting to affect other segments.

And as I've said on earlier calls they are other risk programs that we're investing in a good example of that is fraud. Another. Good example is ciber compliance is the third example.

Speaker #5: Hi, Gabe. It's Kelvin. Why don't I take that first? yeah, so overall, the majority of the year-over-year expense growth is governance and control related.

Leo Salom: All right, Gabe, it's Kelvin. Why don't I take that first? Yeah, so overall, the majority of the year-over-year expense growth is governance and control related. You've already known that part of that is in Leo's business. We've also taken this opportunity to uplift our governance and control costs across the bank, where we see feasible. Maybe I'll pass it on to Ajai just to give you a few examples of those and then to Tim on the investment that he's making in his business.

Speaker #5: you've, you've already known that. Part of that is, is in Leo's business, and we've also taken this opportunity to uplift our, uplift our governance and control costs across, across the bank, where we see feasible.

I would share with you.

So we are investing in other risk programs as well.

Okay.

From a wholesale perspective.

Mentioned the revenue we are aggressively scaling our wholesale business so as you've seen.

Speaker #5: and so maybe, I'll pass it on to Ajai just to give you a few examples of those, and then to Tim on, on the investment that he's making in his business.

In this quarter, we did $2 billion of revenue and the way I would describe that we essentially matched Q2 in revenue, which included the $184 million from Schwab.

Speaker #7: Yeah, so I'd say with respect to second line risk functions that are under my purview, the main area we're investing in is AML. So not just U.S. AML, but we're very much investing in enterprise AML as well.

Ajai Bambawale: Yeah, I'd say with respect to second-line risk functions that are under my purview, the main area we're investing in is AML. Not just U.S. AML, but we're very much investing in enterprise AML as well. As I've said on earlier calls, there are other risk programs that we're investing in. A good example of that is fraud. Another good example is cyber. Compliance is the third example I would share with you. We are investing in other risk programs as well.

That we disclose.

So that involves investment across global markets capital markets as well as investment banking, but.

Speaker #7: Mm-hmm. And as I've said on earlier calls, there are other risk programs that we're investing in. A good example of that is fraud. Another good example is cyber.

But to follow on Rj's point, we also need to make foundational investments in our risk and control platform.

Yes within risk appetite and properly manage our.

Speaker #7: Compliance is the third example I would share with you. So, we are investing in other risk programs as well.

A risk.

But I think we are well on track with our stated goals and the results are showing.

Speaker #9: Okay.

Our strategy is playing out.

Leo Salom: Okay. Gabe, from a wholesale perspective, you mentioned the revenue. We are aggressively scaling our wholesale business. As you've seen, in this quarter, we did $2 billion of revenue. The way I would describe that, we essentially matched Q2 in revenue, which included the $184 million from Schwab that we disclosed. That involves investment across global markets, capital markets, as well as investment banking. To follow on Ajai's point, we also need to make foundational investment in our risk and control platform to allow us to scale within risk appetite and properly manage our risk. I think we are well on track with our stated goals and the results are showing that our strategy is playing out.

Speaker #5: And Gabe, from a wholesale perspective, you mentioned the revenue. We are aggressively scaling our wholesale business. As you've seen, in this quarter, we did $2 billion in revenue. The way I would describe that is we essentially matched Q2 in revenue, which included the $184 million from Schwab that we disclosed.

I'm sure, we'll dive into the detail on the September and a month or so.

The last one buyback the pace I mean, I know, there's the number of shares and the dollar amount.

The stock price has gone up since you're on it.

The buyback program, so, but if I look at the number of shares 30, some odd million in the last quarter 15, or so this quarter unless I'm mistaken.

Speaker #9: Yep.

Speaker #5: That involves investment across global markets, capital markets, as well as investment banking. But to follow on Ajai's point, we also need to make foundational investments in our risk and control platform to allow us to scale within our risk appetite and properly manage our risk.

Are you still committed to the full U S 8 billion dollar amount.

Thanks for the question Gabe It's ray.

And yes. The simple answer is yes, we are still looking to deploy about $8 billion from the Schwab sale proceeds for our current NCI.

And as you said I mean, we did we've made good progress this quarter, we bought back 16 million shares were at about 46 million shares.

Speaker #5: But I think we are well on track with our stated goals, and the results are showing that our strategy is playing out.

We bought back since we announced the program of $4 billion through quarter end and we just note that the pace of the buyback will depend on some of the market conditions and as you saw him noted we.

Speaker #9: I'm sure we'll dive into that in greater detail on the September, in a month or so. last one, buyback, the pace, I mean, I, I know there's the number of shares and the dollar amount, the, the stock price has gone up since you, you announced the, the buyback program.

Gabriel Deshayne: I'm sure we'll dive into that in greater detail in September, in a month or so. The last one, buyback, the pace, I mean, I know there's the number of shares and the dollar amount, the stock price has gone up since you announced the buyback program. If I look at the number of shares, it was 30 some odd million in the last quarter, 15 or so this quarter, unless I'm mistaken. Are you still committed to the full US $8 billion amount?

We accelerated some of that repurchase in Q2, when we saw the share price dip.

Speaker #9: So, if I look at the number of shares, it was 30-some-odd million in the last quarter, and 15 million or so this quarter, unless I'm mistaken.

We are committed to completing the 8 billion buyback that we announced okay, well and through the rest of your summer. Thanks, David.

Speaker #9: are you, you're still committed to the full US 8 billion dollar, amount?

Yeah.

Thank you. The next question is from Matthew Li from.

Speaker #5: thanks for the question, Gabe. It's Ray. and, and yes, the simple answer is yes. we are still looking to deploy about 8 billion dollars from the Schwab sale proceeds for our current NCIB.

Leo Salom: Thanks for the question, Gabe. It's Ray. Yes, the simple answer is yes. We are still looking to deploy about $8 billion from the Schwab sale proceeds for our current NCIB. As you said, we did, you know, we've made good progress this quarter. We bought back 16 million shares. We're at about 46 million shares that we've bought back since we announced the program of $4 billion through quarter end. I'll just note that the pace of the buyback will depend on some of the market conditions. As you saw and noted, we accelerated some of that repurchase in Q2 when we saw the share price dip. We're committed to completing the $8 billion buyback that we announced.

From Canaccord Genuity. Please go ahead.

Hey, Thanks for taking my question, maybe just on the capital market side activity finally seems to be picking up on the C&I front.

Speaker #5: And as you've said, I mean, we did, you know, we've made good progress this quarter. We bought back 16 million shares. we're at about 46 million shares, that we've bought back, since we announced the, the program of 4 billion dollars through quarter end.

How does the addition of an integration Cal and improve your approach to winning investment banking mandates, particularly in the U S and then.

Should we expect capital markets to be a bigger growth driver for you. This cycle than maybe how can you looked in the past.

Speaker #5: And we'll just note that the pace of the buyback will depend on some of the market conditions. As you saw and noted, we accelerated some of that repurchase in Q2 when we saw the share price dip.

Yes, thanks very much for the question I would just say you should absolutely expect.

<unk> growth.

In capital markets.

So I'll give you a longer term view of revenue I'll just take you back to.

Speaker #5: but we're, we are committed to completing the 8 billion, buyback that we announced.

Fiscal 2022, so that was the last.

Speaker #9: Okay, well, enjoy the rest of your summer.

Gabriel Deshayne: Okay, enjoy the rest of your summer.

Full fiscal year prior to the TD Cowen acquisition.

Speaker #5: Thanks, Gabe.

Leo Salom: Thank you.

Speaker #2: Thank you. The next question is from Matthew Lee from Canaccord Genuity. Please go ahead.

Where we were doing on a quarterly basis about $1 2 billion of revenue.

Brooke Hales: Thank you. The next question is from Matthew Lee from Canaccord Genuity. Please go ahead.

In Q4, we guided to an expectation that we could take that to one eight.

Speaker #10: Hey, thanks for my question. maybe just on the capital market side, activity finally seems to be picking up, on the CNID front. You know, how does the addition of an integration of Calvin improve your approach to winning investment banking mandates, particularly in the US?

Leo Salom: Hey, thanks for my question. Maybe just on the capital market side, activity finally seems to be picking up, on the CIB front. You know, how did the addition and integration of TD Cowen improve your approach to winning investment banking mandates, particularly in the U.S.? And then, you know, should we expect capital markets to be a bigger growth driver for you this cycle than maybe how TD's looked in the past? Yeah, thanks very much for the question. I would just say you should absolutely expect continued growth in capital markets. If I give you a longer-term view of revenue, I'll just take you back to fiscal 2022. That was the last full fiscal year prior to the TD Cowen acquisition, where we were doing on a quarterly basis about $1.2 billion of revenue.

Per quarter in this fiscal year and quarter to date as you've seen we're actually coming in at a $2 billion.

Speaker #10: And then, you know, should we expect capital markets to be a bigger growth driver for you this cycle than maybe how TD has looked in the past?

And I would say much like you've seen from other.

Banks over the course of the last few months the first half of the year was about monetizing volatility, which I think we did very well.

Speaker #5: Yeah, thanks very much for the question. I would just say you should absolutely expect continued growth in capital markets. If I give you a longer-term view of revenue, I'll just take you back to fiscal 2022, so that was the last full fiscal year prior to the TD Calvin acquisition.

But as we look at Q3, we've had a meaningful pick up in.

In CIB and within that you would have obviously advisory equity capital markets for US specifically is a much bigger contributor and a lot of that is just as a result of the mix and being.

Speaker #5: where we were doing, on a quarterly basis, about 1.2, billion of revenue. in Q4, we guided to, an expectation that we could, take that to 1.8 billion, per quarter in this, fiscal year.

More exposed to U S equity capital markets activity.

Leo Salom: In Q4, we guided to an expectation that we could take that to $1.8 billion per quarter in this fiscal year. And quarter to date, as you've seen, we're actually coming in at $2 billion. I would say much like you've seen from other banks over the course of the last few months, the first half of the year was about monetizing volatility, which I think we did very well. As we look at Q3, we've had a meaningful pickup in CIB. Within that, you would have obviously advisory, equity capital markets for us specifically is a much bigger contributor. A lot of that is just as a result of the mix and being more exposed to U.S. equity capital markets activity. We also saw leveraged finance pickup.

We also saw a leveraged finance pick up so overall as I said earlier, we are seeing.

Benefits of the broader platform and continuing to scale and invest to become a top 10, North American dealer.

Speaker #5: And quarter to date, as you've seen, we're actually coming in at $2 billion. I would say, much like you've seen from other banks over the course of the last few months, the first half of the year was about monetizing volatility.

Alright, and then as a follow up you know any industries. In particular are you starting to see some excitement in terms of equity and advisory.

It's actually a fairly broad based.

Speaker #5: Which I think we did very well. But as we look at Q3, we’ve had a meaningful pickup in CIB. And within that, you would have obviously advisory. Equity capital markets for us specifically is a much bigger contributor, and a lot of that is just as a result of the mix and being more exposed to U.S. equity capital markets activity.

So I would call out.

Our biotech franchise has been a big contributor our energy energy.

Communication media Telecom.

So I would really suggest to you that the shape of this quarter.

Very well diversified.

And even even though we had.

Outsized global markets activity.

Speaker #5: We also saw, leveraged finance, pick up. So, overall, as I said earlier, we are seeing, the benefits of the broader platform and continuing to scale.

In the first half when you normalize for Schwab.

Leo Salom: Overall, as I said earlier, we are seeing the benefits of the broader platform and continuing to scale and invest to become a top 10 North American dealer. All right. As a follow-up, you know, any industries in particular, are you starting to see some excitement in terms of equity and advisory? It's actually fairly broad-based. I would call out our biotech franchise has been a big contributor, our energy, energy infrastructure, communication, media, telecom. I would really suggest to you that the shape of this quarter is very well diversified. Even though we had outsized global markets activity in the first half, when you normalized for Schwab, the sequential revenue on the market side was actually fairly flat. The meaningful delta, again, was in advisory and capital markets and fairly well diversified, which obviously is encouraging for us. All right. I appreciate the color. I'll pass it on.

Sequential revenue on the market side was actually fairly flat, but the meaningful Delta again was an advisory and capital markets and fairly well diversified, which obviously is encouraging for us.

Speaker #5: And, and invest to become a top 10 North American dealer.

Speaker #10: All right. And as a follow-up, you know, are there any industries in particular where you are starting to see some excitement in terms of equity and advisory?

Alright, I appreciate the color I'll pass along.

Thank you.

The next question is from Ebrahim <unk> from Bank of America. Please go ahead.

Speaker #5: It's actually really fairly broad-based. I would call out our biotech franchise as a big contributor, as well as our energy infrastructure and communication, media, and telecom.

Okay.

Hey, good morning.

I guess, just a few questions around expenses and maybe leave with you on the U S side.

Speaker #5: so I, I would really, suggest to you that the shape of this quarter is very well diversified. and even, even though we had, you know, outsized, global markets activity, in the first half, when you normalize for Schwab, the sequential revenue on the market side was actually fairly flat.

Making sure I'm hearing you correctly.

Okay.

Billions of dollars of loan run off next year.

<unk> growth is going to be mid single digits.

In the U S segment, and all of that obviously speaks to some version of negative operating leverage in that business for next year as well.

Speaker #5: But the meaningful delta again was in advisory and capital markets, and fairly well diversified, which, obviously, is encouraging for us.

And.

Sorry, if I missed it but remind us I feel like the controlled cost email cost, but in the run rate. This year. So when you think about just the drivers of expense growth.

Speaker #10: All right. I appreciate the color. I'll pass it on.

Speaker #2: Thank you. The next question is from Elaine Bunawala from Bank of America. Please go ahead.

Relative to kind of the balance sheet I don't know if that's taking place.

Brooke Hales: Thank you. The next question is from Ibrahim Bunawala from Bank of America. Please go ahead.

How should we think about that in terms of just the U S segment profitability.

Looking out next year.

Speaker #8: Hey, good morning. I guess, just a few questions around expenses and maybe Leo with you on the U.S. side. Just making sure I'm hearing you correctly—there's another, I guess, $18 billion of loans that are going to run off next year.

John Aiken: Hey, good morning. I guess, just a few questions that are on expenses and maybe, Leo, with you on the U.S. side. Just making sure I'm hearing you correctly. There's another, I guess, $18 billion of loans that are going to run off next year. Expense growth is going to be mid-single digits in the U.S. segment. All of that obviously speaks to some version of negative operating leverage in that business for next year as well. Sorry if I missed it, but remind us, I feel like the control costs, AML costs were in the run rate this year. When you think about just the drivers of expense growth relative to the balance sheet runoff that's taking place, how should we think about that in terms of just the U.S. segment profitability looking out next year?

Everything.

Good to hear from you.

Maybe if I could just frame first expenses and then I'll come back to sort of overall profitability from an expense standpoint as Kelvin guided.

We are confident with our spend pattern against the AML program. So we will come in it at the half a billion dollar number for.

Speaker #8: Expense growth is going to be mid-single digits in the U.S. segment. All of that obviously speaks to some version of negative operating leverage in that business for next year as well.

For the 2025 year end and we believe that that number will look similar in 2026. So I think we've got some degree of <unk>.

Speaker #8: And sorry if I missed it, but remind us, I feel like the control costs, AML costs were in the run rate this year. So when you think about just the drivers of expense growth relative to kind of the balance sheet runoff that's taking place, how should we think about that in terms of just the US segment profitability?

Consistency there.

I think from expense standpoint, I would expect the fourth quarter just in terms of where we will.

Land to be somewhat similar in terms of the absolute level of expense that we saw in the third quarter and that and that reflects the slightly higher AML spend pattern just in terms of the calendar as Asian from the first half of the year to the second half of the year and that number obviously in any one given quarter could bump around.

Speaker #8: looking out next year.

Speaker #5: Yeah, everything. It's good to hear from you. Maybe if I could just frame first expenses and then I'll come back to sort of overall profitability.

Leo Salom: Yeah. Ibrahim, good to hear from you. Maybe if I could just frame first expenses and then I'll come back to sort of overall profitability. From an expense standpoint, as Kelvin guided, we are confident with our spend pattern against the AML remediation program. We will come in at the half a billion dollar number for the 2025 year, and we believe that that number will look similar in 2026. I think we've got some degree of consistency there. I think from an expense standpoint, I would expect the fourth quarter, just in terms of where we'll land, to be somewhat similar in terms of the absolute level of expense that we saw in the third quarter. That reflects the slightly higher AML remediation program spend pattern just in terms of the calendarization from the first half of the year to the second half of the year.

I think the piece that we did share with you is that we are guiding to a mid single digit expense growth for 2026, and what that reflects is that while we still will have elevated remediation expenses.

Speaker #5: from an expense standpoint, as Kelvin guided, we, we are confident, with our spend pattern against the AML program. So we will come in at, at the half a billion dollar number, for the 2025 year and, and, and we believe that that number will look similar in 2026.

In line with what we've seen in 2025, you'll start seeing the benefit of the productivity efforts that we.

Speaker #5: So I think, we've got some degree of, of consistency there. I, I think from a expense, standpoint, I would expect the fourth quarter, just in terms of where we'll, land, to be somewhat similar in terms of the absolute level of expense that we saw in the third quarter.

Announced in previous calls and just the deliberate nest around the choices that we're making.

Productivity is important because we want to continue to not only remediate, but also invest in the franchise in those areas that we think have significant growth to your point with regards to overall profitability. We still believe that between the work that we've done on the bond repositioning the tractor on rate versus off grade profile.

Speaker #5: And that reflects the slightly higher AML spend pattern, just in terms of the calendarization from the first half of the year to the second half.

Speaker #5: Of the year. And that number obviously in any one given quarter could bump around. I, I think the, the piece that we did share with you is that we are guiding to a mid-single digit expense growth for, 2026.

Work that we've done to reduce excess liquidity notwithstanding that we're going to have some headwinds related to the run off of the $18 billion that will still have a strong revenue dynamic in 2020.

Leo Salom: That number obviously in any one given quarter could bump around. I think the piece that we did share with you is that we are guiding to a mid-single-digit expense growth for 2026. What that reflects is that while we still will have elevated remediation expenses, somewhat in line with what we've seen in 2025, you'll start seeing the benefit of the productivity efforts that we've announced in previous calls and just the deliberateness around the choices that we're making. Productivity is important because we want to continue to not only remediate, but also invest in the franchise in those areas that we think have significant growth. To your point with regards to overall profitability, the.

Speaker #5: And what that reflects is that while we still will have elevated remediation expenses, somewhat in line with what we've seen in 2025, you'll, you'll start seeing the benefit of, you know, the productivity efforts that, that, that we've announced in previous calls, and just the, the, the, the deliberateness around the, the choices that we're making.

Six and that coupled with the disciplined profile and expenses would lead us to a year of <unk> growth and we will provide a little bit more texture and guidance during the Investor day call in late and late September but.

Long winded way of saying I'm still constructive with regard to the outlook for 2026.

Speaker #5: Productivity is important because we want to continue to not only remediate, but also invest in the franchise in those areas that we think have significant growth.

That's helpful Leo and I think if I heard correctly, you said you expect to have.

Speaker #5: To your point with regard to overall profitability, we still believe that between the work that we've done on the bond repositioning, the tractor on-rate versus off-rate profile, and the work that we've done to reduce excess liquidity, we are standing that we're going to have some headwinds related to the runoff of the $18 billion that will still have a strong revenue dynamic in 2028.

All the work done by the end of the year, that's part of the email remediation stuff is concerned and if that is in fact, the case my understanding of kind of how the U S. Regulators work is you've got sort of your ducks lined up.

Operator: still believe that between the work that we've done on the bond repositioning, the tracked RON rate versus off-rate profile, the work that we've done to reduce excess liquidity, notwithstanding that we're going to have some headwinds related to the run-off of the $18 billion, we'll still have a strong revenue dynamic in 2026. That, coupled with the disciplined profile and expenses, would lead us to a year of NIAC growth. We'll provide a little bit more texture and guidance during the Investor Day call in late September. A long-winded way of saying, I'm still constructive with regards to the outlook for 2026.

E Mail, Joe there for a year two years three years whatever it is but.

If you've ever done by the end of the year and if there's no breakage over the next year or two.

Speaker #5: Six, and that, coupled with the disciplined profile and expenses, would lead us to a year of NIAC growth and will provide a little bit more texture and guidance during the investor day call in late September.

Is it is it.

I'm just wondering the timeline that you had initially put out going into 'twenty eight.

Is that how do you think about or how should we think about the removal of that asset during that process once things are done.

Speaker #5: But, in a long-winded way of saying, I'm still constructive with regard to the outlook for 2026.

The subsequent 12 to 24 months like it.

If you could share your perspective on how shareholders should think about that yeah. So so what I would say, but let's just be a little more.

Brooke Hales: That's helpful, Leo. I think, if I heard correctly, you said you expect to have all the work done by the end of the year as far as the AML remediation program is concerned. If that is, in fact, the case, my understanding of kind of how the U.S. regulators work is, you've got sort of your ducks lined up. They may observe this for a year, two years, three years, whatever it is. If you're done by the end of the year and if there's no breakage over the next year or two, I'm just wondering, the timeline that you had initially put out going into 2028, how do you think about or how should we think about the removal of that asset cap during that process once things are done and the subsequent 12 to 24 months?

What we've said is that we think that the majority of our management actions, which is the first stage of the remediation effort and in other words that did that.

We can control so the design of our programs the documentation of the policies. The implementation of critical process changes that the data the systems those things that that are foundational to a good program. We believe the majority will be completed by the end of 2025, but I've been very clear that some longer tail items.

Do stretch into 2026 and 2027, so the program doesn't entirely complete in 2025.

I'd say the other point that I would clarify is once we complete our management action. There's a number of stages that we will still be subjected to internally within the bank. We have an internal challenge process that both the first and second line. Our conduct then we subject all of our programs to internal audits validation process.

Brooke Hales: If you could share your perspective on how shareholders should think about that.

Operator: Yeah. What I would say, let's just be a little bit more precise. I think what we've said is that we think that the majority of our management actions, which is the first stage of the remediation effort, in other words, that's what we can control. The design of our programs, the documentation of the policies, the implementation of critical process changes, the data, the systems, those things that are foundational to a good program, we believe the majority will be completed by the end of 2025. I've been very clear that some longer-tail items do stretch into 2026 and 2027. The program doesn't entirely complete in 2025. The other point that I would clarify is, once we complete a management action, there's a number of stages that we will still be subjected to.

The monitor will provide.

The regulator will look for a period of sustainability to make sure that the program is in fact living up to expectations. So I think what we can control I feel quite comfortable with the progress we're making on the actual remediation plan, but I just want to I just want to be a little careful about the timing as to an assay.

Or any and we really don't control those items, what we wanted to do is make sure that we build a very strong program as quickly and as comprehensively as possible.

Extremely helpful. Thank you.

Thank you.

The next question is from Sohrab <unk> from BMO capital markets. Please go ahead.

Operator: Internally, within the bank, we have an internal challenge process that both the first and second line will conduct. We subject all of our programs to internal audits validation process. The monitor will provide their governance oversight. Finally, the regulator will look for a period of sustainability to make sure that the program is, in fact, living up to expectations. What we can control, I feel quite comfortable with the progress we're making on the actual remediation plan. I just want to be a little careful about the timing as to an asset cap or any we really don't control those items. What we want to do is make sure that we build a very strong program as quickly and as comprehensively as possible.

Okay. Thank you I wonder if I could just ask a tenant and a little bit more on wholesale bank.

I mean, you I think you mentioned Tim that there are some investments that are taking place.

To accommodate the top 10 type.

I suppose aspiration in North America, I see a big increase in for example, a fulltime equivalent.

Our employee count some of it I suppose it is seasonal but.

Can I get a sense of.

As you think about where you were trying to go how much more.

Investing and spending.

To take place.

Brooke Hales: Extremely helpful. Thank you.

When when do we expect to.

Brooke Hales: Thank you. The next question is from Sirad Mullahedi from Bank of Montreal Capital Markets. Please go ahead.

To see the fruits of that so to speak on a sustained basis. So I would say thanks very much for the question I would say with regard to Fps that is absolutely seasonal so as you look out over the next year over year or out over the medium term, we don't expect much.

Raymond Chun: Okay. Thank you. I wonder if I could just ask Tim a little bit more on wholesale banking. I mean, I think you mentioned, Tim, that there are some investments that are taking place to accommodate a top 10 type, I suppose, aspiration in North America. I see a big increase in, for example, full-time equivalent or employee count. Some of it, I suppose, is seasonal. Can I get a sense of, as you think about where you're trying to go, how much more investing and spending needs to take place? You know, when do we expect to see the fruits of that, so to speak, on a sustained basis?

<unk> increase in our.

Complement of Ftes.

And I would say just generally.

Be able to share more color in terms of the shape of the of the investment profile at the Investor Day.

But youre really seeing all elements of expense hitting in.

The current year.

And so to give you tangible examples are convertible platform didn't exist a year ago and as a meaningful contributor.

Two the league table rankings that youre seeing in the equity and equity linked.

That requires investment.

Operator: Yeah. I would say thanks very much for the question. I would say, with regard to FTEs, that is absolutely seasonal. As you look out over the next year over year or out over the medium term, we don't expect a material increase in our complement of FTEs. I would say, just generally, we'll be able to share more color in terms of the shape of the investment profile at the Investor Day. You're really seeing all elements of expense hitting in the current year. To give you tangible examples, our convertible platform didn't exist a year ago. It is a meaningful contributor to the league table rankings that you're seeing in equity and equity linked. That requires investment. We've been quite open that we are expanding our U.S. Prime business. You're seeing growth in Prime overall, 20% plus, but more to come as we roll out incremental strategies.

Been quite open that we are expanding our U S. Prime bids that you are seeing growth in prime overall.

20%, plus but more to come as we rollout.

Incremental strategies, so that's hitting.

The employees that we've added.

Which again I would say on a net net basis are neutral.

<unk>.

Matter of expertise and leaders in their field, but as you know there's a J curve there and then finally all of this has to happen within our risk appetite.

And so there is a material investment in our risk and control platform and we're a year and two two or two or three year program on on that front.

Essentially over the medium term.

Revenue growth continues in those expenses normalize I'm confident that we'll hit our targets that we'll speak more about next month.

Okay.

I appreciate that and I mean, I'm sure you're going to give us more details I guess next month.

I guess I wanted to try and you go as you make this progress towards your let's call. It three year plan is there is there an anticipation that your risk weighted assets here. She can continue to grow.

Operator: That's hitting. The employees that we've added, which, again, I would say on a net-net basis are neutral, are subject matter expertise and leaders in their field. As you know, there's a J curve there. Finally, all of this has to happen within our risk appetite. There's a material investment in our risk and control platform. We're a year into a two or three-year program on that front. Essentially, over the medium term, as revenue growth continues and those expenses normalize, I'm confident that we'll hit our targets that we'll speak more about next month.

At the right end to end.

What sort of an ROE target on your back yeah. So maybe I would take you back to the pre Cowen acquisition.

Obviously prior to this substantial investment we were generating 13%.

ROE and efficiency ratios in the low 60. So this is this is how we run the business, but as you well know.

Generally.

It takes three to five years to build a world class platform and that's what we're doing with regard to risk weighted assets, a big part of our objective.

Raymond Chun: Okay, Tim. I appreciate that. I'm sure you're going to give us more details, I guess, next month. I guess it's worth a try. As you make this progress towards your, let's call it, three-year plan, is there an anticipation that your risk-weighted assets here should then continue to grow at some sort of a rate? You know, what sort of an ROE target do they have on your back?

Is around the denominator and how we're managing capital.

So the first part of that process is to make sure you have the right tools to deepen your your client relationships and drive a re rocks.

With your with your clients.

Operator: Yeah. Maybe I would take you back to the pre-Calon acquisition because, obviously, prior to this substantial investment, we were generating over 13% ROEs and efficiency ratios in the low 60%. This is how we've run the business. As you well know, generally, it takes three to five years to build a world-class platform. That's what we're doing. With regard to risk-weighted assets, a big part of our objective is around the denominator and how we're managing capital. The first part of that process is to make sure you have the right tools to deepen your client relationships and drive railrocks with your clients. The second part is delivering, which I think we're doing.

Part is delivering.

I think we're doing.

But to be clear, we have an exercise that basically looks at the loan book.

And that looks for opportunity to upscale and go deeper and reallocate where.

Where necessary now that we have a platform in place.

Okay.

W.

Okay. Thank you very much look forward to 2009.

Okay.

Okay.

Thank you. The next question is from Doug Young from visual Bad capital markets. Please go ahead.

Hi, good morning.

It's Roger.

Q2 kind of things on credit.

Yes.

Impaired loan formations in and U S. Commercial I think you talked about but then in the U S. There are some real lease of performing loan allowances and so I'm just trying to connect that you win and you walked through where their beliefs came from and then you can I think you said $600 million of expert credit judgment and continue to perform.

Um, you know, at some sort of a rate and and you know what sort of an Roe Target, do they have on your back? Yeah. So maybe I would take you back to the pre-cal uh acquisition. Um because obviously uh, prior to, this substantial investment, we were generating over 13% Roe's and efficiency ratios in the low 60s. So, uh, this is the, you know, this is how we run the business, but as you, well know, uh, generally, uh, it takes 3 to 5 years to, to build a world-class platform and, and, uh, that's what we're doing with regard to risk, weighted assets. A big part, uh, of our objective, uh, is around the denominator and how we're managing Capital. So, the first, uh, part of that process is to make sure you have the right tools, uh, to deepen, your, your client relationships, and, and drive, uh, Rae rocks, uh, with your, with, with your clients, uh, the second

Operator: To be clear, we have an exercise that basically looks at the loan book and looks for opportunity to upscale and go deeper and reallocate where necessary now that we have a platform in place to monetize more effectively against that loan book or RWA.

Loan allowances.

And related to risks around trade policies can you put a little more meat around that zero last year, how does that involve.

Raymond Chun: Okay. Thank you very much. Look forward to the 29th of September.

Part is delivering, uh, which I think we're doing. Uh, but to be clear, we have an exercise that that basically looks at, uh, the loan book, uh, and looks for opportunity, uh, to upscale and go deeper and reallocate, uh, where necessary. Now that we have a platform uh, in place to monetize more effectively against that loan book or rwa.

And then I have a follow up thanks.

Okay, thank you very much. I look forward to the September 29th session.

So.

Brooke Hales: Thank you. The next question is from Doug Young from Desjardins Capital Markets. Please go ahead.

And there are multiple parts to your question. So let me try and.

Each one of them.

You mentioned higher juice.

Thank you. The next question is from Doug Young from Deja de Capital Markets. Please go ahead.

Leo Salom: Hi. Good morning. It's for Ajai. Two kind of things on credit. Higher, you know, gross compared to loan formations in U.S. commercial, I think you talked today. In the U.S., there's a release of performing loan allowances. I'm just trying to connect the two and maybe walk through where the release came from. If you can, I think you said about $600 million of expert credit judgment. I think it's in your performing loan allowances, related to risks around trade policies. Can you put a little more meat around that? Like, is that your last year? How has that evolved? I have a follow-up. Thanks.

We saw higher juice, but some of it came from wholesale and from some from the U S.

Hi, good morning. Um, this project

Wholesale that we're ready for borrowers.

One was it in telecom and cable to in professional and other and one in transportation.

A few impairments on the U S commercial book.

And I would call those pretty much expected and there was one.

C&I in the industrial construction and created the contractor space I don't necessarily view this as a trend, but you are right in pointing out.

The number of digital numbers did cool if.

If I look at the U S embed P C L.

2 2 kind of things on credit, uh, higher, you know, gross impaired, loan, formations and, and US commercial, I think you talked about, but then in, in the US you've there's a release of Performing loan allowances and so I'm just trying to connect it to you. And maybe walk through, uh, where the release came from. And then if you can, I think you said about 600 million of experts credit judgement, I think it's in your performing load allowances. Um, are related to risks around trade policies? Can you put a little more meat around that like, is that zero last year? How is that evolved? Um,

Kelvin Tran: Yeah. Tim, there are multiple parts to your questions. Let me try and answer each one of them. You mentioned higher JILs. Yes, we saw higher JILs. Some of it came from wholesale and some from the U.S. In wholesale, there were really four borrowers. One was in telecom and cable, two in professional and other, and one in transportation. There were a few impairments on the U.S. commercial book. Three of them were CRI, and I would call those pretty much expected. There was one in CNI, in the industrial construction and trade contractor space. I don't necessarily view this as a trend, but you're right in pointing out the number of the JIL numbers did go up. If I look at U.S. impaired PCLs, U.S. impaired PCLs went up because of these impairments and the related reserves.

Sales went up because of these impairments and the related reserves.

And then have a follow-up. Thanks.

And then Youre correct in pointing out that on a performing basis performing PCL in the U S came down and there was I would call. It smaller releases and the main driver of that small release was the macro.

Yeah, so again there are multiple parts to your question. So let me try and answer each one of them.

And the macro environment in the United States.

And my my final comment on that would be that I have seen this variation quarter over quarter.

And it's not every quarter that embeds into segments would move in the same line. So it's not an unexpected event.

From my perspective, and then let me turn to.

The $600 million.

We've actually been $600 million.

You mentioned, higher gills. And, and yes, we saw higher gills. Some of it came from wholesale and from some from the US in wholesale, they were ready for borrowers. Uh, 1 was in Telecom and cable 2 in professional and other and 1 in transportation. There were a few impairments on the US commercial book, 3 of them were 3. And I would call those uh, pretty much expected. And there was 1 uh in cni in the industrial construction and trade contractor space. I don't necessarily use this as a trend, but you're right in pointing out uh, the number. The Gill numbers did did go up.

Over three quarters.

Okay.

In Q1, and then we add the big build in Q2.

Kelvin Tran: You're correct in pointing out that on a performing basis, performing PCLs in the U.S. came down. There was, I would call it, a small release. The main driver of that small release was the change in the macro environment in the United States. My final comment on that would be that I have seen this variation quarter over quarter, and it's not every quarter that the impaired in the segments would move in the same line. It's not an unexpected event from my perspective. Let me turn to the $600 million. We've actually built $600 million over three quarters. We started building in Q1, then we had the big build in Q2. What we did this quarter was we actually went and refreshed all the work we did last quarter and went deep into understanding the borrowers that were most sensitive to tariffs.

If I look at U.S. impaired, PCL's U.S. impaired. PCL's went up because of these impairments and the related reserves.

Did this quarter was we actually went and refreshed all of the work, we did last quarter and when deep into understanding the borrowers that were most sensitive to diners and when we did this work so thats non retail when we did this work we looked at the potential impact on their financials.

Whether it was revenue or cost of goods sold.

That gave us an idea of what potential migration should occur could it be one notch could it be two notches and we use that potential migration to determine the allowance would be and this quarter because that number was slightly higher we took a little more against.

Business in government lending what we've also done is we've been looking at the consumer portfolios over these three quarters, we're looking at the potential impact of inflation and higher rates on consumers. So this quarter, we actually added a little bit for the consumer books as well so if I.

Basis performing pcls in the US came down and there was I would call it a small release and the main driver of that small release was the macro change in the macro environment in the United States and my my final comment on that would be that I have seen this variation quarter over quarter, you know, and it's it's not every quarter that the impedance and the segments would move in the in the same line. So it it's not an unexpected event for my perspective, and then let me turn to uh the 6 0 0.

A total of $600 million.

Kelvin Tran: When we did this work, that's non-retail. When we did this work, we looked at the potential impact on their financials, whether it was revenue or cost of goods sold. That gave us an idea of what potential migration should occur. Could it be one notch? Could it be two notches? We used that potential migration to determine what the allowance would be. This quarter, because that number was slightly higher, we took a little more against business and government lending. We've also been looking at the consumer portfolios over these three quarters. We're looking at the potential impact of inflation and higher rates on consumers. This quarter, we actually added a little bit for the consumer books as well. If I take that total $600 million, approximately $410 million is for business and government, and $190 million is for the consumer sector.

Approximately $410 million as book business in government and $119 million is for the consumer sector. So again I'll just end by saying I'm very comfortable with where we're at we've done a lot of work to determine what the overall it should be I think you know this uncertainty still exists.

Okay, we started building in Q1. Then we had the big build in Q2. What we did this quarter was we actually went and refreshed all the work we did last quarter and went deep into understanding the borrowers that were most sensitive to tariffs.

Yeah, it's going to continue for a while but I feel we're well positioned we're sitting at 103 beeps reserves and I'll leave it at that.

And when we did this work, so that's non-retail. When we did this work, we looked at the potential impact on their financials, you know, whether it was revenue or cost of goods sold. That gave us an idea of what potential migration should occur. Could it be 1 notch? Could it be 2 notches? We used that potential migration to determine what the allowance would be. And this quarter, because that number was slightly higher, we took...

And so just to follow up on that.

600, and the form 10090, <unk>, how much of that is Canada images I would assume amongst Canada.

Yeah, we haven't disclosed that but I can tell you a fair bit as Canadian PNC and the balance is a U S. There's some for U S retail and there is some wholesale.

And then just a real life example, like what is that 600, and we had a breakdown in U S. MCA.

That is what this is.

That would happen, but it provides you a question.

Kelvin Tran: I'll just end by saying I'm very comfortable with where we are at. We've done a lot of work to determine what the overlay should be. I think you know this uncertainty still exists, and it's going to continue for a while. I feel we're well positioned. We're sitting at 103 bps reserves, and I'll leave it at that.

Anticipation of that is that how to think about 600 million. But this is we've made certain tariff assumptions for Canada and the United States. This is really taking those assumptions and running it through our portfolio to determine.

A little more against uh business and government lending. What we've also done is we've been looking at the consumer portfolios over these 3 quarters. We're looking at the potential impact of inflation and higher rates on consumers. So this quarter, we actually added a little bit for the consumer books as well, so if I take that total 600 million dollars, approximately 410 million is for business and government and 119 million is for the consumer sector. So again, I just end by saying, I'm very comfortable with where we are at. We've done a lot of work to determine what the overlay should be, I think, you know, this uncertainty still exists.

What incremental migration or reserves.

Leo Salom: Just to follow up on that, the $600 and the $410, $190, how much of that is Canada? I would assume most of this is Canada?

And it's going to continue for a while, but I feel we're well positioned. We're sitting at 103 bps reserves, and I'll leave it at that.

Now I want to be very clear that.

We've made certain assumptions to the extent that tariffs turn out to be higher than the assumptions. We've made that means we have to build more reserves to the extent the data turn.

Kelvin Tran: Yeah, we haven't disclosed that, but I can tell you a fair bit is Canadian PNC, and the balance is U.S. There is some for U.S. retail, and there's some for wholesale.

Turned out to be lower than what we would assume that means we would be releasing and to the extent that status as of June.

Leo Salom: Just in a real-life example, what is that $600 million? If we had a breakdown in the USMCA, that is what this is there for. It doesn't cover, obviously, everything that would happen, but it provides you a cushion in anticipation of that. Is that how to think of that $600 million?

Is it just a follow up on that? That's that's 600. And the 41010190 how much of that is Canada? How much is? I would assume most of this is Canada. But um, yeah, we haven't disclosed that but I, I can tell you a fair bit as Canadian agency and the balance is you there is something us retail and there's some for wholesale.

As that book migrate we built our reserves report or drawdown on those reserves.

Okay, and then just second lien you've talked about are we improvement in the U S.

I guess, it's kind of there's two parts to the equation, obviously, the numerator and the denominator you know how much of this is driven numerator and denominator.

Kelvin Tran: This is we've made certain tariff assumptions for Canada and the U.S. This is really taking those tariff assumptions and running it through our portfolio to determine what incremental migration or reserves would be required. I want to be very clear that we've made certain assumptions. To the extent that tariffs turn out to be higher than the assumptions we made, that means we have to build more reserves. To the extent that tariffs turn out to be lower than what we've assumed, that means we would be releasing. To the extent that tariffs are as assumed, then as that book migrates, we build the reserves. We're going to draw down on those reserves.

Can you give some kind of context to where you started and when you get to that ROE.

Well Doug.

Thanks for the question.

We will be providing more more clarity with regards to return on equity target at the Investor day, So I won't I won't front run that discussion at this point, but.

And I just need a real-life example. Like, what is that? $600 million. So if we had a breakdown in USMCA, like, that is what this is there for. It doesn't cover, obviously, everything that would happen, but it provides you a cushion in anticipation of that. Is that how to think about $600 million? Well, this is, we've made certain tariff assumptions for Canada and the United States. This is really taking those tariff assumptions and running it through a portfolio to determine what incremental migration or reserves would be required. Now I want to be very clear that...

It's been a combination of both right. So if you look at.

We are clearly a contracting.

Portions of the portfolio.

We believe or not.

Accretive to or.

Our return on equity profile.

Leo Salom: Okay. Leo, you've talked about ROE improvements in the US. I guess it's kind of there's two parts of the equation, obviously, the numerator and the denominator. How much of this is driven numerator versus denominator? Can you give a kind of context to where you started and where you think you can get to with that US ROE?

But the reality is a lot of the a lot of the benefit that <unk> reduction is still funneling through.

We've made certain assumptions to the extent that tariffs turn out to be higher than the assumptions we've made. That means we have to build more results. To the extent that tariffs turn out to be lower than what we've assumed, that means we would be releasing. And to the extent that tariffs are as assumed, then as that book migrates, we build the results; we're going to draw down on those reserves.

Through the balance sheet, so where you're seeing the improvement right now has been the improvement in overall operating results we had three sequential.

At quarters of <unk> growth.

From fourth quarter of last year at present.

Operator: Thank you for the question. We will be providing more clarity with regards to return on equity target at the Investor Day. I won't front-run that discussion at this point. It's been a combination of both, right? If you look at it, we are clearly contracting portions of the portfolio that we believe are not accretive to our return on equity profile. The reality is a lot of the benefit, because that RWA reduction is still funneling through the balance sheet. Where you're seeing the improvement right now has been the improvement in overall operating results. We've had three sequential quarters of NIAC growth from the fourth quarter of last year to present, and that has allowed us to be able to post cumulatively 140 basis points' worth of improvement when you exclude Schwab. I think we're executing as expected at this point.

Yeah. Okay. And then just second, Leo, you talked about how our improvements in the U.S. Um, you know, I guess it's kind of there's two parts of the equation. Obviously, the numerator and the denominator. You know, how much of this is driven, numerator versus denominator? And then can you give him like kind of a context to where you started and where you think you can get to with that U.S. ROE?

And that has allowed us to be able to post cumulatively 140 basis points worth of improvement when you exclude schwab so.

I think we're executing as expected at this point.

I hope that.

You will also appreciate the fact that you are beginning to get a sense based on the performance that we posted this quarter at $695 million and earnings what the what the what the outlook.

26, as well so I think right now it's been a it's been an earnings story.

Well, I I thanks for the question. I I um, we will be providing more more clarity, uh, with regards to return on Equity Target at the investor day. So I I won't, uh, I won't Frontline that discussion at this point, but, um, it's been a combination of both, right? So if you look at, uh, we are clearly, uh, Contracting. Um, portions of the portfolio that we that we believe are not um, accretive to or um, you know, to our return on Equity, uh, profile.

Aided by the fact that we are selectively making some changes on the balance sheet side, you'll see more of that balance sheet impact next year as we complete the overall U S balance sheet restructuring.

Okay.

I appreciate the color. Thank you.

Thank you.

Thank you. The next question is from Sheila <unk>.

We've had 3 sequential, uh uh quarters of neach growth.

Very tough investment research. Please go ahead.

Good morning, and thank you for taking my question I'm, referring to slide 42.

It was a sharp year over year.

Operator: I hope that you also appreciate the fact that you're beginning to get a sense, based on the performance that we posted this quarter at $695 million in earnings, what the outlook could look like for 2026 as well. I think right now it's been an earnings story aided by the fact that we are selectively making some changes on the balance sheet side. You'll see more of that balance sheet impact next year as we complete the overall U.S. balance sheet restructuring.

Improvement in the Canadian commercial connect performance.

So it was a bit elevated.

I look at the size of the loan portfolio. They look pretty similar in terms of size and mix.

This is highlighted or difference in underwriting standards or is it more of a function of balance sheet positioning in the U S side.

<unk>.

And the two countries.

Yeah, So let me.

So let me explain the difference between what happened with Canadian BMC.

In the U S retail and I wouldn't call. It a difference in underwriting standards of underwriting standards are pretty consistent across the across the board in underwriting standards are not something that we are.

Raymond Chun: Appreciate the color. Thank you.

Um, uh, from fourth quarter of last year to present. Um, and that has allowed us to be able to post cumulatively 140 base points worth of improvement when you exclude Schwab. So, um, I I think we're we're, we're, we're executing as expected at this point. Um, I I hope that, um, you also appreciate the, the fact that you're beginning to, to get a sense based on the performance that we posted this quarter, at 695 million in earnings, what the, what the, what the Outlook could look like for 2026 as well. So, I, I think right now, it's been a, it's been an earning story with aided by the fact that we are selectively, making some changes on the balance sheet side, you'll see more of that balance sheet impact. Next year, as we complete the overall us balance sheet, uh, restructure

Operator: Thank you.

Appreciate the call. Thank you.

Thank you.

Brooke Hales: Thank you. The next question is from Shilam Garg from Veritas Investment Research. Please go ahead.

We changed the underwriting standards are consistent.

Ajai Bambawale: Good morning, and thank you for taking my question. I'm referring to slide 42. There was a sharp year-over-year improvement in the Canadian commercial credit performance, whereas the US was a bit elevated. When I look at the size of the loan portfolios, they look pretty similar in terms of size and mix. Does this highlight a difference in underwriting standards, or is it more of a function of balance sheet positioning in the US and the relative size in the two countries?

Thank you. The next question is from Shalimar from Veritas Investment Research. Please go ahead.

What you see on Canadian PNC as Youll see the numbers are down $159 million compared shutdowns.

<unk> is down 107.

The U S. Retail is also down so directionally b cells.

It's the same okay.

<unk> is down $149 million in the U S. The divergence is coming from in bags.

Good morning, and thank you for taking my questions. I'm referring to slide 42. Now, there was a short period over here of improvement in the Canadian commercial. Correct performance. Whereas U.S. was a bit elevated. Now, when I look at the size of the loan portfolios, they look pretty similar in terms of size and mix. Now, does this highlight a difference in underwriting standards or is it more of a...

Function of balance sheet positioning in the U.S. and the relative size.

Kelvin Tran: Yeah. Let me, it's Ajai. Let me explain the difference between what happened with Canadian PNC and U.S. retail. I wouldn't call it a difference in underwriting standards. The underwriting standards are pretty consistent across the board, and underwriting standards are not something that we change. The underwriting standards are consistent. What you see on Canadian PNC is the numbers are down $159 million. Impaireds are down $52 million and performing is down $107 million. U.S. retail is also down. Directionally, PCLs are the same, okay? Performing is down $149 million in the U.S. The divergence has come from impaireds, and impaired PCL is slightly up. It's up $21 million. The reason impaired PCL is up is we did see some impairments. As I mentioned, there are CRI.

Uh, in the 2 countries.

PCL is slightly up it's upgrading $1 million and the reason for it.

<unk> is up is we did see some impairments.

Yes, so let me it's AJ. So let me explain the difference between what happened with Canadian PNC and

As I mentioned, there clearly there were three including two in the office.

One office one in retail one multifamily and then there was one in C&I.

Again I have to say the results are generally consistent I wouldn't call. The underwriting standards are different but in any given quarter you can see some variation.

Thanks, so much.

And in fact, I think I've said on previous calls this whole situation in the U S is still playing out.

Very well reserved for.

That situation, so I'll leave it at that.

Thank you for the explanation I'll turn it back to them.

Thank you. The next question is from Paul Holden.

CIBC. Please go ahead.

Alright. Thank you good morning, I'll try to keep it quick in the interest of time so question for stoner.

Kelvin Tran: There were three in CRI: two in office, one in office, one in retail, one multifamily, and then there was one in CNI. I'd say the results are generally consistent. I won't call the underwriting standards different, but in any given quarter, you can see some variation across products, across segments. In fact, CRI, I think I've said on previous calls, this whole CRI situation in the U.S. is still playing out, and we're very well reserved for that situation. I'll leave it at that.

Kind of a two part question, but trying to get to the major point, which is sort of maybe the NII.

and US retail and I won't call it a difference in underwriting standard. The underwriting standards are pretty consistent across the across the board and underwriting. Standards are not something that we uh, you know, we we change. So the underwriting standards are are consistent. Uh what you see on Canadian PNC is you see? The numbers are down 159 million in pairs. Are down 52 and Performing is down. 107 us. Retail is also down so directionally pcl's are it's the same, okay, but performing is down 149 million in the US the Divergence has come from impacts okay? And embedded PCL is slightly up, it's upgrading 1 million dollars and the reason impaired PCL is up is we did see some impairments. As as I mentioned, there are clear there were 3 and 3 2 in office, uh, 1 in office, 1 in retail.

Canadian P&C banking, so if I look at loan growth in the corner see residential mortgage is down a bit.

1 multifamily. And then there was 1 in CNI.

Loan growth than what I think are higher margin products HELOC cards.

So maybe you can talk through that a bit in terms of looking why.

Why residential mortgages down in the quarter, but on the other side.

The second part of the question is really on deposit mix I know in past quarters, you've talked to a benefit of <unk> is rolling off and demand deposits growing that ongoing and do you expect it to be ongoing and then again that really leads to like sort of what's the NIM and NII outlook for the segment. Thank you.

So again, I'd say the results are generally consistent; I won't call the underwriting standards different, but in any given quarter, you can see some variation across products and across segments. And in fact, I think I've mentioned on previous calls that this whole crease situation in the U.S. is still playing out, you know, and we're very well reserved for that situation. So I'll leave it at that.

Ajai Bambawale: Thank you for the explanation. I'll turn it back in.

Thank you for the explanation. I'll turn it back on.

Brooke Hales: Thank you. The next question is from Paul Holden from Canadian Imperial Bank of Commerce. Please go ahead.

John Aiken: Hi. Thank you. Good morning. I'll try to keep it quick in the interest of time. A question for Sona. It's kind of a two-part question, but trying to get to the major point, which is sort of maybe the NII outlook on Canadian PNC banking. If I look at loan growth in the quarter, I see residential mortgages down a bit, but then strong growth in what I think are higher margin products, HELOC, cards. Maybe you can talk through that a bit in terms of the outlook and why residential mortgage is down in the quarter, but the growth on the other side. The second part of the question is really on deposit mix. I know in past quarters, you've talked about the benefit of GICs rolling off and demand deposits growing. Is that ongoing? Do you expect it to be ongoing?

Thank you. The next question is from Paul Holden from CIBC. Please go ahead.

Sure. Thanks.

Also our.

First maybe on the loan side of that.

And we've seen actually.

Real quickly just a quarter, we've seen strong sequential momentum in our rental business.

Speaking of problems in the aggregate.

Jim Sheila.

So on average basis, it's up 1% quarter over quarter and better than that on a spot basis.

So we are seeing good growth both in that line as well as in the credit card business, we're seeing strong 7% year over year growth in the credit card business.

Hi. Thank you. Good morning. I'll try to keep it quick in the interest of time. Uh, so question for Sona, and it's a kind of a two-part question, but trying to get to the major point, which is sort of maybe the needle on Canadian PNC banking. So if I look at loan growth in the quarter, residential mortgages are down a bit, but there is strong growth in what I think are higher margin products, HELOCs.

If I look at NIM and NII, obviously, there is a number of factors there broadly.

Influencing both NIM and NII things from tractor chassis confer allowed us to know where they.

John Aiken: That really leads to like sort of what's the NII outlook for the segment? Thank you.

Um, so maybe you can talk through that a bit in terms of the outlook. And why residential mortgages were down in the quarter, but there was growth on the other side. The second part of the question is really on deposits next. I know in past quarters you've talked about the benefit of GICs rolling off and demand deposits growing. Is that ongoing, and do you expect it to continue?

So our large core deposit business.

As long as the product mix and balance sheet.

Gabriel Deshayne: For sure. Thanks, Paul. First, maybe on the loan side of the business, we've seen actually, you know, we're quite pleased with the quarter. We've seen strong sequential momentum in the real estate secured lending business. I'm speaking here, Paul, to the aggregate of both mortgage and HELOC. On an average basis, it's up 1% quarter over quarter and better than that on a spot basis. We are seeing good growth both in that line as well as in the credit card business. We've seen strong 7% year-over-year growth in the credit card business. As I look at NIM and NII, obviously, there's a number of factors there broadly influencing both NIM and NII, things from tractors, which obviously confer a lot of stability to our large core deposit business, as well as product mix and balance sheet mix.

Calling. And then again, that really leads to sort of what's the name and our outlook for the segment. Thank you.

So in the quarter in particular, I think like benefited from a favorable deposit margin.

Sure, thanks. Uh, Paul. So

Max impact.

On the railroad side of the business coupled with the sequential growth we saw in March.

Expansions that we saw.

Over a quarter and year over year.

Better margins.

On origination and port.

Folios for kind of FRP for Russell.

We've seen actually uh, you know, we're quite pleased with the quarter. We've seen strong sequential momentum in the Russell business. Uh, and I'm speaking here Paul to the aggregate of both mortgage and HELOC. So on an average basis, it's up 1% quarter over quarter and uh, better than that on a spa basis.

And then the credit card business, obviously is healthy from an NII perspective.

So that's maybe the first part of the question hopefully I answer that for you on the deposit side of the business.

Also I would say a strong partner.

Both year over year and quarter over quarter and personal deposit growth.

And what we are seeing.

But our growth shift positively to demand deposits.

Gabriel Deshayne: In the quarter in particular, I think we benefited from favorable deposit margins, including a mixed impact. On the real estate secured lending side of the business, coupled with the sequential growth, we saw good margin expansion. We saw both quarter over quarter and year over year better margins, both on originations as well as the portfolio. Kind of a four-peat for real estate secured lending. The credit card business, obviously, is healthy from an NII and NIM perspective. That's maybe the first part of the question. Hopefully, I've answered that for you. On the deposit side of the business, also, I would say a strong quarter. We've led both year over year and quarter over quarter in personal deposits growth. What we are seeing is a good growth shift positively to demand deposits. That is also positive momentum. I think a number of factors coming together.

For business, you know, as I look at MIM and NIM, obviously, there are a number of factors broadly influencing both NIM and NEE. You know, things from tractors, which obviously confer a lot of stability to our large core deposit business, as well as product mix and balance sheet mix.

So that is also a positive momentum, but I think a number of factors coming together and we continue to die.

Um, so in the quarter in particular, I think we benefited from favorable deposit margins, including a mix impact.

Relatively steady momentum heading into Q4.

But we're pleased overall with our strong.

Thank you Raymond said momentum.

And I guess what went wrong.

I got the guidance is for stable, but if I put all of that everything together.

And what that suggests to me and probably Q.

On the resolution side of the business, coupled with the sequential growth, we saw, good, uh, margin expansion. So we saw both quarter over quarter and year-over-year, um, better margins, uh, both um, on originations, as well as the portfolio, so kind of a 4 piece, uh, for Russell.

Q4, but you're guiding to stable. So we're just being conservative in that guidance.

Um and then the credit card business obviously uh is healthy from an knee and then perspective.

Or do you expect a change in trend just again, just trying to square a square everything up here yeah.

Items.

So I think Theres a number of factors then obviously, there's not a lot of mix impact.

Uh, so that's maybe the first part of the question. Hopefully, I've, uh, answered that for you on the deposit side of the business, you know? Also, I would say a strong quarter. Um, so we've led both year-over-year and quarter-over-quarter in personal deposits growth.

The one piece that we haven't spoken about like balance sheet.

Okay.

It comes into play so I think our guidance.

Right one.

Okay I'll leave it there thank you.

Gabriel Deshayne: We continue to guide to relatively stable NIM heading into Q4. We're pleased overall with a strong exit in Q3 with good momentum.

Thank you.

The next question is from Darko <unk> from RBC capital markets. Please go ahead.

And what we are seeing is is a good uh growth shift positively to demand deposits um so that is also positive momentum so I think you know a number of factors coming together. Uh we continue to guide uh to relatively stable them uh heading into Q4.

Okay.

John Aiken: Okay. I guess really where I'm going with that is I get the guidance is for stable, but if I put all of everything together, it certainly benefited the quarter. What it suggests to me, it'd probably benefit Q4, but you're guiding to stable. Are you just being conservative in that guidance, or do you expect a change in trend? Just again, just trying to square everything up here.

Thank you good morning, I'll be really quick as well Oh Gee, you gave great detail on the $600 million.

But we're pleased overall with a strong exit in Q3, with good momentum.

Reserve.

So maybe just to boil it down.

I'd like to understand.

Sort of what would it take to release them right would it be the U S. MCA is left alone for example would that be better than anticipated and caused a release of substantially those reserves.

Gabriel Deshayne: Yeah. No, I think the guidance is sound, Paul. I think there's a number of factors in this. It's obviously a growth business. There's a lot of mixed impacts. The one piece that we hadn't spoken about, like balance sheet mix, also comes into play. I think our guidance is the right one.

Okay. And I guess really where I'm going with that is like I get the guidance is for stable, but if I put all the everything together, it's certainly benefited the quarter. And with the suggest to me, it probably benefit Q4 but you're guiding to to stable. So are you just being conservative in that guidance? Um, or do you expect to change and try and just again just trying to square square, everything up here?

No, I think the guidance.

If tariffs equaled what Europe got.

Number of factors.

Would that be better than what you anticipated and release those reserves, but it'll be to sort of.

Outcomes that would result in substantially most of those reserves being released.

John Aiken: Okay. I'll leave it there. Thank you.

Yes.

Okay.

The one piece that we hadn't spoken about, like balance sheet myths, also comes into play. So I think our guidance is the right one. Okay, I'll leave it there. Thank you.

Great way to think about it I mean.

Brooke Hales: Thank you. The next question is from Darko Milic from Royal Bank of Canada Capital Markets. Please go ahead.

As I said, we've made some assumptions of what migration were to occur and there were underlying tariff assumptions naturally if things central central and uncertainty reduces and there's more clarity around tariffs and let's say that that is a lower.

Thank you. The next question is from Darko Mitch from RBC Capital Markets. Please go ahead.

Operator: Thank you. Good morning. I'll be really quick as well. Ajai, you gave great detail off of the $600 million reserve. Maybe just to boil this down, I'd like to understand sort of what would it take to release them, right? Would it be the USMCA is left alone, for example? Would that be better than anticipated and cause a release of substantially those reserves? If tariffs equaled what Europe got, would that be better than what you've anticipated and release those reserves? Would those be two sort of outcomes that would result in substantially most of those reserves being released?

No we would reassess that resolved and if you have to release part of that reserve.

Thank you. Good morning. I'll be really quick as well. Uh, RJ you gave great. Good detail on the 600 million, uh, Reserve.

So maybe just to boil it down.

At the same time.

Changes in the U S MCA that the negative and they are higher than what we're doing.

Zero.

Then you should expect us to increase our reserves.

And then the third point I made and this is a really important point because we built the reserve if the migration occurs as we think it is that we've already built the reserves, we're going to use those reserves. So if you look ahead and we are working still working on the guidance.

I'd like to understand sort of what would it take to release them, right? Would it be that the USMCA is left alone? For example, would that be better than anticipated and cause a release of substantially those reserves? If tariffs equal what Europe got.

Kelvin Tran: Yeah. I think where you're going is the right way to think about it. I mean, as I said, we made some assumptions of what migration would occur, and there were underlying tariff assumptions. Naturally, if things settle and the uncertainty reduces and there's more clarity around tariffs, and let's say the tariffs are lower, you know, we would reassess that reserve. If you have to release part of that reserve, we will. At the same time, you know, if there are changes in the USMCA that are negative and they're higher than what we've assumed, then you should expect us to increase our reserves. The third point I made, and this is a really important point because we built the reserve. If the migration occurs as we think it is, then we've already built the reserves. We're going to use those reserves.

Uh, would that be better than what you’ve anticipated? And would those reserves be released? Would those be two sort of, uh, outcomes that would result in substantially most of those reserves being released?

For next year.

Pat will follow but the way I look at it as looking forward I actually expect impaired PCL to gradually rise from these levels, it's going to be gradual as the impact of that as it plays out.

And then performing PCL depends on their drivers, okay, but to the extent that that are starting up more favorable then I know the other drag was but yes, it's going to have a positive impact on performing and using lower performing next year.

That helps you Darko, yes. It does thank you very much.

Yeah, I I think we are going is is the right way to think about it. I mean we as I said, we made some assumptions of what migration would occur and there were underlying tariff, assumptions naturally, if things subtle settle and and the uncertainty reduces and there's more clarity around tariffs and let's say the tariffs are lower, you know, we would reassess that reserve and if you have to release part of that Reserve, we will at the same time, you know, if their changes in the US MCA that are negative and they're higher than what we assumed, then you should expect us to increase our Reserves.

Thank you there are no further questions registered.

At this time I will turn the call back to Mr. Raymond Tong.

Well. Thank you operator, and thank you everyone for joining us today, we appreciate as always the questions and your comments.

Kelvin Tran: If you look ahead, and we are still working on the guidance for you for next year, you know, that will follow. The way I look at it is looking forward, I actually expect impaired PCLs to gradually rise from these levels. It's going to be gradual as the impact of tariff plays out. Performing PCL depends on the drivers, okay? To the extent that tariffs turn out more favorable, then I know there are other drivers, but yes, it's going to have a positive impact on performing, and you'll see lower performing next year. Hope that helps you, Darko.

And let me just wrap by saying that TD has delivered for its stakeholders in Q3.

10% revenue growth positive operating leverage strong credit performance.

And then the third point I made, and this is a really important point because we've built the reserve. If the migration occurs as we think it is, then we've already built the results. We are going to use those results. So if you look ahead, and we are still working on the guidance for you for next year, you know that will follow. But the way I look at it is looking forward.

So on that note we wish all of you a good long weekend and look forward to speaking with all of you again real soon at our Investor Day on September 29. Thank you.

I actually expect embed tcl's to gradually rise from these levels. It's going to be gradual as the impact of tariff plays out and then performing PCL depends on the drivers okay but to the extent that tariffs turn out more favorable, then I know the other drivers but yes, it's going to have a positive impact on performing and you'll see lower performing next year.

Operator: Yeah, it does. Thank you very much.

Hope that helps your due. Yeah, it does. Yeah, thank you very much.

Brooke Hales: Thank you. There are no further questions registered. At this time, I will turn the call back to Mr. Raymond Chun.

Thank you do for the questions, registered.

Raymond Chun: Thank you, operator, and thank you, everyone, for joining us today. We appreciate, as always, the questions and your comments. Let me just wrap by saying that TD has delivered for its stakeholders in Q3 with 10% revenue growth, positive operating leverage, and strong credit performance. On that note, we wish all of you a good long weekend. I look forward to speaking with all of you again real soon at our Investor Day on September 29. Thank you.

At this time, I will turn the call back to Mr. Raymond Chong.

Well, thank you, operator. And thank you, everyone, for joining us today. We appreciate it, as always, the questions and your comments.

ERS in Q3, a 10% revenue growth.

Positive operating leverage; strong credit performance.

So, on that note, we wish all of you a good long weekend. We look forward to speaking with all of you again, real soon, at our Investor Day on September 29th. Thank you.

Brooke Hales: Thank you. The conference has now ended. Please disconnect your lines at this time, and we thank you for your participation.

Thank you. The conference has now ended.

Please disconnect your lines at this time and we thank you for your participation.