Scotiabank's 2019
audited annual consolidated financial statements and accompanying
Management's Discussion & Analysis (MD&A) are available at
www.scotiabank.com along with the supplementary financial
information and regulatory capital disclosure reports, which
includes fourth quarter financial information. All amounts are in
Canadian dollars and are based on our audited annual consolidated
financial statements and accompanying MD&A for the year ended
October 31, 2019 and related notes prepared in accordance with
International Financial Reporting Standards (IFRS), unless
otherwise noted.
Additional
information related to the Bank, including the Bank's Annual
Information Form, can be found on the SEDAR website at
www.sedar.com and on the EDGAR section of the SEC's website at
www.sec.gov.
|
Fiscal 2019
Highlights on a Reported basis (versus Fiscal 2018)
|
Fourth Quarter
2019 Highlights on a Reported basis (versus Q4,
2018)
|
· Net income of
$8,798 million, compared to $8,724 million
|
· Net income of
$2,308 million, compared to $2,271 million
|
· Earnings per
share (diluted) of $6.68, compared to $6.82
|
· Earnings per
share (diluted) of $1.73, compared to $1.71
|
· Return on
equity of 13.1%, compared to 14.5%
|
· Return on
equity of 13.3%, compared to 13.8%
|
· Annual common
dividend per share of $3.49 compared to $3.28, an increase of
6%
|
|
|
|
Fiscal 2019
Highlights on an Adjusted basis1 (versus Fiscal
2018)
|
Fourth Quarter
2019 Highlights on an Adjusted basis1 (versus Q4,
2018)
|
· Net income of
$9,409 million, compared to $9,144 million
|
· Net income of
$2,400 million, compared to $2,345 million
|
· Earnings per
share (diluted) of $7.14, compared to $7.11
|
· Earnings per
share (diluted) of $1.82, compared to $1.77
|
· Return on
equity of 13.9%, compared to 14.9%
|
· Return on
equity of 13.8%, compared to 14.1%
|
Fiscal 2019 performance versus medium-term objectives
The following table provides a summary of our 2019 performance
against our medium-term financial performance objectives:
Medium-term
Objectives
|
Fiscal 2019
Results
|
|
Reported
|
Adjusted1
|
Diluted earnings per
share growth of 7%+
|
(2.1)%
|
0.4%
|
Return on equity of
14%+
|
13.1%
|
13.9%
|
Achieve positive
operating leverage
|
Negative
3.3%
|
Negative
2.1%
|
Maintain strong
capital ratios
|
CET1 capital ratio of
11.1%
|
CET1 capital ratio of
11.1%
|
1 Refer to Non-GAAP Measures section
on page 3.
|
TORONTO, Nov. 26, 2019 /CNW/ - Scotiabank reported net
income of $8,798 million in 2019,
compared with net income of $8,724
million in 2018. Diluted earnings per share (EPS) was
$6.68, compared to $6.82 in the previous year. Return on equity was
13.1%, compared to 14.5% in the previous year.
Adjusting for the Acquisition and divestiture-related
amounts(1) of $611 million
after tax ($593 million pre-tax), net
income increased 3% to $9,409 million
and EPS rose to $7.14 from
$7.11 in the previous year.
Reported net income for the fourth quarter ended October 31, 2019 was $2,308 million compared to $2,271 million in the same period last year.
Diluted earnings per share was $1.73,
compared to $1.71 in the same period
a year ago. Return on equity was 13.3% compared to 13.8% a year
ago.
Adjusting for Acquisition and divestiture-related
amounts(1), net income increased 2% to $2,400 million and EPS rose to $1.82 from $1.77
last year.
"We delivered improved fourth quarter results to end a
productive year for the Bank. In 2019, we made significant progress
against our strategic objectives by sharpening our geographic
footprint and improving our business mix. We've also invested
heavily in our people, processes, and technology to better position
the Bank for success over the long-term," said Brian Porter, President and CEO of
Scotiabank.
Canadian Banking generated earnings of $4,424 million in 2019 driven by solid asset and
deposit growth, margin expansion, and higher wealth management
earnings. Canadian Banking continued to deliver an excellent
customer experience across our businesses and channels and
strengthened its product suite throughout the year.
International Banking delivered another strong year of
double-digit earnings growth with reported earnings of $3,387 million in 2019. The business successfully
integrated a number of acquisitions this year, delivering better
than expected synergies. Our geographic re-positioning efforts are
substantially complete, giving us greater scale, lower operating
risk, and more opportunities for growth.
Global Banking and Markets reported earnings of $1,534 million in 2019, with double-digit asset
growth and stronger performance in the second half of the year in
our capital markets business.
The Bank's Common Equity Tier 1 capital ratio remains strong at
11.1%, or 11.55% on a pro-forma basis including the impact of
announced divestitures, with strong internal capital generation,
and prudent growth of risk weighted assets, while buying back 15
million shares this year.
"Strategically we set a course to become a more focused Bank. As
a result of this effort, we have repositioned our international
footprint, improved our business mix and are now realizing the
benefits of our investments in digital," said Porter. "Looking
ahead in 2020, we are better positioned to build an even better
Bank, offering a superior customer experience, and delivering
sustainable, long-term earnings growth for our shareholders."
1 Refer to Non-GAAP Measures section
on page 3.
|
Non-GAAP Measures
The Bank uses a number of financial measures to assess its
performance. Some of these measures are not calculated in
accordance with Generally Accepted Accounting Principles (GAAP),
which are based on International Financial Reporting Standards
(IFRS) as issued by the International Accounting Standards Board
(IASB), are not defined by GAAP and do not have standardized
meanings that would ensure consistency and comparability among
companies using these measures. The Bank believes that certain
non-GAAP measures are useful in assessing ongoing business
performance and provide readers with a better understanding of how
management assesses performance. These non-GAAP measures are used
throughout this press release and are defined in the "Non-GAAP
Measures" section of our 2019 Annual Report.
Adjusted results and diluted earnings per share
The following tables present reconciliations of GAAP Reported
financial results to Non-GAAP Adjusted financial results. The
financial results have been adjusted for the following:
Acquisition and divestiture-related amounts –
Acquisition and divestiture-related amounts are defined as:
A) Acquisition-related costs
1. Integration costs – Includes costs that are incurred and
relate to integrating the acquired operations and are recorded in
the Canadian and International Banking operating segments. These
costs will cease once integration is complete. The costs relate to
the following acquisitions:
- Banco Cencosud, Peru
(closed Q2, 2019)
- Banco Dominicano del Progreso, Dominican Republic (closed Q2,
2019)
- MD Financial Management, Canada (closed Q4, 2018)
- Jarislowsky, Fraser Limited, Canada (closed Q3, 2018)
- Citibank consumer and small and medium enterprise operations,
Colombia (closed Q3,
2018)
- BBVA, Chile (closed Q3,
2018)
2. Day 1 provision for credit losses on acquired performing
financial instruments, as required by IFRS 9. The standard does not
differentiate between originated and purchased performing loans and
as such, requires the same accounting treatment for both. These
credit losses are considered Acquisition-related costs in periods
where applicable and are recorded in the International Banking
segment. The costs for 2019 relate to Banco Cencosud, Peru and Banco Dominicano del Progreso,
Dominican Republic. The costs for
2018 relate to BBVA, Chile and
Citibank, Colombia.
3. Amortization of Acquisition-related intangible assets,
excluding software. These costs relate to the six acquisitions
above, as well as prior acquisitions and are recorded in the
Canadian and International Banking operating segments.
B) Net (gain)/loss on divestitures –
The Bank has announced a number of divestitures in 2019 in
accordance with its strategy to reposition the Bank. The net loss
attributable to equity holders of $308
million was recorded in the Other segment, relating to the
following divestitures (refer to Note 37 in the 2019 Annual Report
for further details):
- Gain on sale of banking operations in the Caribbean (closed Q4, 2019)
- Loss on sale of Colfondos AFP announced in Q4, 2019
- Loss on sale of operations in Puerto
Rico announced in Q3, 2019
- Gain on divestiture of Scotia Crecer AFP and Scotia Seguros in
the Dominican Republic (closed
Q2, 2019)
- Loss on sale of the insurance and banking operations in
El Salvador announced in Q2,
2019
Reconciliation of reported and adjusted results and diluted
earnings per share
|
For the three months
ended
|
For the year
ended
|
|
|
October
31
|
|
July 31
|
|
October 31
|
|
October
31
|
|
October 31
|
($
millions)
|
|
2019
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Reported
Results
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
$
|
4,336
|
$
|
4,374
|
$
|
4,220
|
$
|
17,177
|
$
|
16,191
|
Non-interest
income
|
|
3,632
|
|
3,285
|
|
3,228
|
|
13,857
|
|
12,584
|
Total
revenue
|
|
7,968
|
|
7,659
|
|
7,448
|
|
31,034
|
|
28,775
|
Provision for credit
losses
|
|
753
|
|
713
|
|
590
|
|
3,027
|
|
2,611
|
Non-interest
expenses
|
|
4,311
|
|
4,209
|
|
4,064
|
|
16,737
|
|
15,058
|
Income before
taxes
|
|
2,904
|
|
2,737
|
|
2,794
|
|
11,270
|
|
11,106
|
Income tax
expense
|
|
596
|
|
753
|
|
523
|
|
2,472
|
|
2,382
|
Net
income
|
$
|
2,308
|
$
|
1,984
|
$
|
2,271
|
$
|
8,798
|
$
|
8,724
|
Net income
attributable to non-controlling interests in subsidiaries
(NCI)
|
|
107
|
|
120
|
|
92
|
|
408
|
|
176
|
Net income
attributable to equity holders
|
|
2,201
|
|
1,864
|
|
2,179
|
|
8,390
|
|
8,548
|
Net income
attributable to common shareholders
|
|
2,137
|
|
1,839
|
|
2,114
|
|
8,208
|
|
8,361
|
Diluted earnings
per share (in dollars)
|
$
|
1.73
|
$
|
1.50
|
$
|
1.71
|
$
|
6.68
|
$
|
6.82
|
Adjustments
|
|
|
|
|
|
|
|
|
|
|
Acquisition and
divestiture-related amounts
|
|
|
|
|
|
|
|
|
|
|
Day 1 provision for
credit losses on acquired performing financial
|
|
|
|
|
|
|
|
|
|
|
instruments(1)
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
151
|
$
|
404
|
Integration
costs(2)
|
|
79
|
|
43
|
|
75
|
|
178
|
|
101
|
Amortization of
Acquisition-related intangible assets, excluding
software(2)
|
|
28
|
|
30
|
|
27
|
|
116
|
|
86
|
Acquisition-related costs
|
|
107
|
|
73
|
|
102
|
|
445
|
|
591
|
Net loss/(gain) on
divestitures(3)
|
|
1
|
|
320
|
|
-
|
|
148
|
|
-
|
Acquisition and
divestiture-related amounts (Pre-tax)
|
|
108
|
|
393
|
|
102
|
|
593
|
|
591
|
Income tax
expense/(benefit)
|
|
(16)
|
|
78
|
|
(28)
|
|
18
|
|
(171)
|
Acquisition and
divestiture-related amounts (After tax)
|
|
92
|
|
471
|
|
74
|
|
611
|
|
420
|
Adjustment
attributable to NCI
|
|
5
|
|
(5)
|
|
(9)
|
|
(50)
|
|
(122)
|
Acquisition and
divestiture-related amounts (After tax and NCI)
|
$
|
97
|
$
|
466
|
$
|
65
|
$
|
561
|
$
|
298
|
Adjusted
Results
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
$
|
4,336
|
$
|
4,374
|
$
|
4,220
|
$
|
17,177
|
$
|
16,191
|
Non-interest
income
|
|
3,626
|
|
3,591
|
|
3,228
|
|
13,984
|
|
12,584
|
Total
revenue
|
|
7,962
|
|
7,965
|
|
7,448
|
|
31,161
|
|
28,775
|
Provision for credit
losses
|
|
753
|
|
713
|
|
590
|
|
2,876
|
|
2,207
|
Non-interest
expenses
|
|
4,197
|
|
4,122
|
|
3,962
|
|
16,422
|
|
14,871
|
Income before
taxes
|
|
3,012
|
|
3,130
|
|
2,896
|
|
11,863
|
|
11,697
|
Income tax
expense
|
|
612
|
|
675
|
|
551
|
|
2,454
|
|
2,553
|
Net
income
|
$
|
2,400
|
$
|
2,455
|
$
|
2,345
|
$
|
9,409
|
$
|
9,144
|
Net income
attributable to NCI
|
|
102
|
|
125
|
|
101
|
|
458
|
|
298
|
Net income
attributable to equity holders
|
|
2,298
|
|
2,330
|
|
2,244
|
|
8,951
|
|
8,846
|
Net income
attributable to common shareholders
|
$
|
2,234
|
$
|
2,305
|
$
|
2,179
|
$
|
8,769
|
$
|
8,659
|
Adjusted
diluted earnings per share
|
|
|
|
|
|
|
|
|
|
|
Adjusted net income
attributable to common shareholders
|
$
|
2,234
|
$
|
2,305
|
$
|
2,179
|
$
|
8,769
|
$
|
8,659
|
Dilutive impact of
share-based payment options and others
|
|
30
|
|
44
|
|
21
|
|
160
|
|
72
|
Adjusted net income
attributable to common shareholders (diluted)
|
$
|
2,264
|
$
|
2,349
|
$
|
2,200
|
$
|
8,929
|
$
|
8,731
|
Weighted average
number of basic common shares outstanding
(millions)
|
|
1,218
|
|
1,221
|
|
1,230
|
|
1,222
|
|
1,213
|
Dilutive impact of
share-based payment options and others (millions)
|
|
29
|
|
30
|
|
16
|
|
29
|
|
16
|
Adjusted weighted
average number of diluted common shares
|
|
|
|
|
|
|
|
|
|
|
outstanding
(millions)
|
|
1,247
|
|
1,251
|
|
1,246
|
|
1,251
|
|
1,229
|
Adjusted diluted
earnings per share (in dollars)(4)
|
$
|
1.82
|
$
|
1.88
|
$
|
1.77
|
$
|
7.14
|
$
|
7.11
|
Impact of
adjustments on diluted earnings per share (in
dollars)
|
$
|
0.09
|
$
|
0.38
|
$
|
0.06
|
$
|
0.46
|
$
|
0.29
|
(1) Recorded in
provision for credit losses.
|
(2) Recorded in
non-interest expenses.
|
|
|
|
|
|
|
|
|
|
|
(3) Loss/(gain) on
divestitures are recorded in non-interest income; costs related to
divestitures are recorded in non-interest expenses.
|
(4) Earnings per
share calculations are based on full dollar and share
amounts.
|
|
Reconciliation of reported and adjusted results by business
line
Canadian Banking(1)
|
For the three months
ended
|
For the year
ended
|
|
|
October
31
|
|
July 31
|
|
October 31
|
|
October
31
|
|
October 31
|
($
millions)
|
|
2019
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Reported
Results
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
$
|
2,138
|
$
|
2,120
|
$
|
2,029
|
$
|
8,284
|
$
|
7,898
|
Non-interest
income
|
|
1,428
|
|
1,412
|
|
1,414
|
|
5,609
|
|
5,452
|
Total
revenue
|
|
3,566
|
|
3,532
|
|
3,443
|
|
13,893
|
|
13,350
|
Provision for credit
losses
|
|
247
|
|
240
|
|
198
|
|
972
|
|
794
|
Non-interest
expenses
|
|
1,779
|
|
1,723
|
|
1,747
|
|
6,943
|
|
6,654
|
Income before
taxes
|
|
1,540
|
|
1,569
|
|
1,498
|
|
5,978
|
|
5,902
|
Income tax
expense
|
|
397
|
|
409
|
|
383
|
|
1,554
|
|
1,538
|
Net
income
|
$
|
1,143
|
$
|
1,160
|
$
|
1,115
|
$
|
4,424
|
$
|
4,364
|
Net income
attributable to equity holders
|
$
|
1,143
|
$
|
1,160
|
$
|
1,115
|
$
|
4,424
|
$
|
4,364
|
Adjustments
|
|
|
|
|
|
|
|
|
|
|
Acquisition-related costs
|
|
|
|
|
|
|
|
|
|
|
Integration
costs(2)
|
$
|
10
|
$
|
4
|
$
|
28
|
$
|
27
|
$
|
31
|
Amortization of
Acquisition-related intangible assets, excluding
software(2)
|
|
14
|
|
14
|
|
14
|
|
56
|
|
40
|
Acquisition-related costs (Pre-tax)
|
|
24
|
|
18
|
|
42
|
|
83
|
|
71
|
Income tax
expense/(benefit)
|
|
(7)
|
|
(4)
|
|
(11)
|
|
(22)
|
|
(19)
|
Acquisition-related costs (After
tax)
|
|
17
|
|
14
|
|
31
|
|
61
|
|
52
|
Acquisition-related costs (After tax and
NCI)
|
$
|
17
|
$
|
14
|
$
|
31
|
$
|
61
|
$
|
52
|
Adjusted
Results
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
$
|
2,138
|
$
|
2,120
|
$
|
2,029
|
$
|
8,284
|
$
|
7,898
|
Non-interest
income
|
|
1,428
|
|
1,412
|
|
1,414
|
|
5,609
|
|
5,452
|
Total
revenue
|
|
3,566
|
|
3,532
|
|
3,443
|
|
13,893
|
|
13,350
|
Provision for credit
losses
|
|
247
|
|
240
|
|
198
|
|
972
|
|
794
|
Non-interest
expenses
|
|
1,755
|
|
1,705
|
|
1,705
|
|
6,860
|
|
6,583
|
Income before
taxes
|
|
1,564
|
|
1,587
|
|
1,540
|
|
6,061
|
|
5,973
|
Income tax
expense
|
|
404
|
|
413
|
|
394
|
|
1,576
|
|
1,557
|
Net
income
|
$
|
1,160
|
$
|
1,174
|
$
|
1,146
|
$
|
4,485
|
$
|
4,416
|
Net income
attributable to equity holders
|
$
|
1,160
|
$
|
1,174
|
$
|
1,146
|
$
|
4,485
|
$
|
4,416
|
(1) Refer
to Business Segment Review on page 14.
|
|
|
|
|
|
|
|
|
|
|
(2) Recorded in
non-interest expenses.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
International Banking(1)
|
For the three months
ended
|
For the year
ended
|
|
|
October
31
|
|
July 31
|
|
October 31
|
|
October
31
|
|
October 31
|
($
millions)
|
|
2019
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Reported
Results
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
$
|
2,124
|
$
|
2,157
|
$
|
2,030
|
$
|
8,482
|
$
|
7,322
|
Non-interest
income
|
|
1,250
|
|
1,270
|
|
1,104
|
|
5,006
|
|
4,111
|
Total
revenue
|
|
3,374
|
|
3,427
|
|
3,134
|
|
13,488
|
|
11,433
|
Provision for credit
losses
|
|
502
|
|
476
|
|
412
|
|
2,076
|
|
1,867
|
Non-interest
expenses
|
|
1,795
|
|
1,780
|
|
1,721
|
|
7,027
|
|
6,111
|
Income before
taxes
|
|
1,077
|
|
1,171
|
|
1,001
|
|
4,385
|
|
3,455
|
Income tax
expense
|
|
254
|
|
269
|
|
197
|
|
998
|
|
706
|
Net
income
|
$
|
823
|
$
|
902
|
$
|
804
|
$
|
3,387
|
$
|
2,749
|
Net income
attributable to non-controlling interests in subsidiaries
(NCI)
|
|
90
|
|
121
|
|
92
|
|
391
|
|
176
|
Net income
attributable to equity holders
|
$
|
733
|
$
|
781
|
$
|
712
|
$
|
2,996
|
$
|
2,573
|
Adjustments
|
|
|
|
|
|
|
|
|
|
|
Acquisition-related costs
|
|
|
|
|
|
|
|
|
|
|
Day 1 provision for
credit losses on acquired performing financial
|
|
|
|
|
|
|
|
|
|
|
instruments(2)
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
151
|
$
|
404
|
Integration
costs(3)
|
|
69
|
|
39
|
|
47
|
|
151
|
|
70
|
Amortization of
Acquisition-related intangible assets, excluding
software(3)
|
|
14
|
|
16
|
|
13
|
|
60
|
|
46
|
Acquisition-related costs (Pre-tax)
|
|
83
|
|
55
|
|
60
|
|
362
|
|
520
|
Income tax
expense/(benefit)
|
|
(23)
|
|
(16)
|
|
(17)
|
|
(104)
|
|
(152)
|
Acquisition-related costs (After
tax)
|
|
60
|
|
39
|
|
43
|
|
258
|
|
368
|
Adjustment
attributable to NCI
|
|
(12)
|
|
(5)
|
|
(9)
|
|
(66)
|
|
(122)
|
Acquisition-related costs (After tax and
NCI)
|
$
|
48
|
$
|
34
|
$
|
34
|
$
|
192
|
$
|
246
|
Adjusted
Results
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
$
|
2,124
|
$
|
2,157
|
$
|
2,030
|
$
|
8,482
|
$
|
7,322
|
Non-interest
income
|
|
1,250
|
|
1,270
|
|
1,104
|
|
5,006
|
|
4,111
|
Total
revenue
|
|
3,374
|
|
3,427
|
|
3,134
|
|
13,488
|
|
11,433
|
Provision for credit
losses
|
|
502
|
|
476
|
|
412
|
|
1,925
|
|
1,463
|
Non-interest
expenses
|
|
1,712
|
|
1,725
|
|
1,661
|
|
6,816
|
|
5,995
|
Income before
taxes
|
|
1,160
|
|
1,226
|
|
1,061
|
|
4,747
|
|
3,975
|
Income tax
expense
|
|
277
|
|
285
|
|
214
|
|
1,102
|
|
858
|
Net
income
|
$
|
883
|
$
|
941
|
$
|
847
|
$
|
3,645
|
$
|
3,117
|
Net income
attributable to NCI
|
|
102
|
|
126
|
|
101
|
|
457
|
|
298
|
Net income
attributable to equity holders
|
$
|
781
|
$
|
815
|
$
|
746
|
$
|
3,188
|
$
|
2,819
|
(1) Refer to
Business Segment Review on page 17.
|
|
|
|
|
|
|
|
|
|
|
(2) Recorded in
provision for credit losses.
|
|
|
|
|
|
|
|
|
|
|
(3) Recorded in
non-interest expenses.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other(1)
|
For the three months
ended
|
For the year
ended
|
|
|
October
31
|
|
July 31
|
|
October 31
|
|
October
31
|
|
October 31
|
($
millions)
|
|
2019
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Reported
Results
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
$
|
(263)
|
$
|
(240)
|
$
|
(176)
|
$
|
(985)
|
$
|
(483)
|
Non-interest
income/(loss)
|
|
121
|
|
(144)
|
|
(26)
|
|
158
|
|
(53)
|
Total
revenue
|
|
(142)
|
|
(384)
|
|
(202)
|
|
(827)
|
|
(536)
|
Provision for credit
losses
|
|
-
|
|
1
|
|
-
|
|
1
|
|
-
|
Non-interest
expenses
|
|
106
|
|
113
|
|
43
|
|
304
|
|
60
|
Income before
taxes
|
|
(248)
|
|
(498)
|
|
(245)
|
|
(1,132)
|
|
(596)
|
Income tax
expense/(benefit)
|
|
(185)
|
|
(46)
|
|
(181)
|
|
(585)
|
|
(449)
|
Net income
(loss)
|
$
|
(63)
|
$
|
(452)
|
$
|
(64)
|
$
|
(547)
|
$
|
(147)
|
Net income
attributable to non-controlling interests in subsidiaries
(NCI)
|
|
17
|
|
(1)
|
|
-
|
|
17
|
|
-
|
Net income (loss)
attributable to equity holders
|
$
|
(80)
|
$
|
(451)
|
$
|
(64)
|
$
|
(564)
|
$
|
(147)
|
Adjustments
|
|
|
|
|
|
|
|
|
|
|
Adjustments for
Net loss on divestitures (Pre-tax)(2)
|
$
|
1
|
$
|
320
|
$
|
-
|
$
|
148
|
$
|
-
|
Income tax
expense/(benefit)
|
|
14
|
|
98
|
|
-
|
|
144
|
|
-
|
Net loss on
divestitures (After tax)
|
|
15
|
|
418
|
|
-
|
|
292
|
|
-
|
Adjustment
attributable to NCI
|
|
17
|
|
-
|
|
-
|
|
16
|
|
-
|
Net loss on
divestitures (After tax and NCI)
|
$
|
32
|
$
|
418
|
$
|
-
|
$
|
308
|
$
|
-
|
Adjusted
Results
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
$
|
(263)
|
$
|
(240)
|
$
|
(176)
|
$
|
(985)
|
$
|
(483)
|
Non-interest
income
|
|
115
|
|
162
|
|
(26)
|
|
285
|
|
(53)
|
Total
revenue
|
|
(148)
|
|
(78)
|
|
(202)
|
|
(700)
|
|
(536)
|
Provision for credit
losses
|
|
-
|
|
1
|
|
-
|
|
1
|
|
-
|
Non-interest
expenses
|
|
99
|
|
99
|
|
43
|
|
283
|
|
60
|
Income before
taxes
|
|
(247)
|
|
(178)
|
|
(245)
|
|
(984)
|
|
(596)
|
Income tax
expense/(benefit)
|
|
(199)
|
|
(144)
|
|
(181)
|
|
(729)
|
|
(449)
|
Net income
(loss)
|
$
|
(48)
|
$
|
(34)
|
$
|
(64)
|
$
|
(255)
|
$
|
(147)
|
Net income
attributable to NCI
|
|
-
|
|
(1)
|
|
-
|
|
1
|
|
-
|
Net income (loss)
attributable to equity holders
|
$
|
(48)
|
$
|
(33)
|
$
|
(64)
|
$
|
(256)
|
$
|
(147)
|
(1) Refer to
Business Segment Review on page 22.
|
|
|
|
|
|
|
|
|
|
|
(2) Loss/(gain) on
divestitures are recorded in non-interest income; costs related to
divestitures are recorded in non-interest expenses.
|
Reconciliation of International Banking's reported and
constant dollar results
International Banking business segment results are analyzed on a
constant dollar basis. Under the constant dollar basis, prior
period amounts are recalculated using current period average
foreign currency rates. The following table presents the
reconciliation between reported and constant dollar results for
International Banking for prior periods.
|
For the three months
ended
|
For the year
ended
|
($ millions)
(unaudited)
|
July 31,
2019
|
October 31,
2018
|
October 31,
2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign
|
|
Constant
|
|
|
|
Foreign
|
|
Constant
|
|
|
|
Foreign
|
|
Constant
|
(Taxable
equivalent basis)
|
|
Reported
|
|
exchange
|
|
dollar
|
|
Reported
|
|
exchange
|
|
dollar
|
|
Reported
|
|
exchange
|
|
dollar
|
Net interest
income
|
$
|
2,157
|
$
|
52
|
$
|
2,105
|
$
|
2,030
|
$
|
46
|
$
|
1,984
|
$
|
7,322
|
$
|
27
|
$
|
7,295
|
Non-interest
income
|
|
1,270
|
|
13
|
|
1,257
|
|
1,104
|
|
8
|
|
1,096
|
|
4,111
|
|
13
|
|
4,098
|
Total
revenue
|
|
3,427
|
|
65
|
|
3,362
|
|
3,134
|
|
54
|
|
3,080
|
|
11,433
|
|
40
|
|
11,393
|
Provision for credit
losses
|
|
476
|
|
13
|
|
463
|
|
412
|
|
17
|
|
395
|
|
1,867
|
|
52
|
|
1,815
|
Non-interest
expenses
|
|
1,780
|
|
41
|
|
1,739
|
|
1,721
|
|
44
|
|
1,677
|
|
6,111
|
|
54
|
|
6,057
|
Income tax
expense
|
|
269
|
|
2
|
|
267
|
|
197
|
|
(2)
|
|
199
|
|
706
|
|
(15)
|
|
721
|
Net
income
|
$
|
902
|
$
|
9
|
$
|
893
|
$
|
804
|
$
|
(5)
|
$
|
809
|
$
|
2,749
|
$
|
(51)
|
$
|
2,800
|
Net income
attributable to
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
non-controlling
interest
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
in
subsidiaries
|
$
|
121
|
$
|
5
|
$
|
116
|
$
|
92
|
$
|
5
|
$
|
87
|
$
|
176
|
$
|
(1)
|
$
|
177
|
Net income
attributable to equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
holders of the
Bank
|
$
|
781
|
$
|
4
|
$
|
777
|
$
|
712
|
$
|
(10)
|
$
|
722
|
$
|
2,573
|
$
|
(50)
|
$
|
2,623
|
Other
measures
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average assets ($
billions)
|
$
|
206
|
$
|
4
|
$
|
202
|
$
|
193
|
$
|
3
|
$
|
190
|
$
|
168
|
$
|
1
|
$
|
167
|
Average liabilities
($ billions)
|
$
|
158
|
$
|
3
|
$
|
155
|
$
|
153
|
$
|
3
|
$
|
150
|
$
|
131
|
$
|
-
|
$
|
131
|
The above table is
computed on a basis that is different than the table "Impact of
Foreign Currency Translation" on page 10.
|
Core banking assets
Core banking assets are average
earning assets excluding bankers' acceptances and average trading
assets within Global Banking and Markets.
Core banking margin
This ratio represents net interest
income divided by average core banking assets.
Return on equity
Return on equity is a profitability
measure that presents the net income attributable to common
shareholders as a percentage of average common shareholders'
equity.
In the first quarter of 2019, in line with OSFI's increased
Domestic Stability Buffer announced requirements, the Bank
increased the capital attributed to its business lines to
approximate 10.0% of Basel III common equity capital requirements
based on credit, market and operational risks and leverage inherent
within each business segment. Previously, capital was attributed
based on a methodology that approximated 9.5% of Basel III common
equity capital requirements.
Return on equity for the business segments is calculated as a ratio
of net income attributable to common shareholders of the business
segment and the capital attributed. Prior period returns on equity
for the business segments have not been restated.
Financial Highlights
|
For the three months
ended
|
|
For the year
ended
|
|
October
31
|
|
July 31
|
|
October 31
|
|
October
31
|
|
October 31
|
|
2019
|
(1)
|
2019
|
(1)
|
2018
|
|
2019
|
(1)
|
2018
|
Operating
results ($ millions)
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
4,336
|
|
4,374
|
|
4,220
|
|
17,177
|
|
16,191
|
Non-interest
income
|
3,632
|
|
3,285
|
|
3,228
|
|
13,857
|
|
12,584
|
Total
revenue
|
7,968
|
|
7,659
|
|
7,448
|
|
31,034
|
|
28,775
|
Provision for credit
losses
|
753
|
|
713
|
|
590
|
|
3,027
|
|
2,611
|
Non-interest
expenses
|
4,311
|
|
4,209
|
|
4,064
|
|
16,737
|
|
15,058
|
Income tax
expense
|
596
|
|
753
|
|
523
|
|
2,472
|
|
2,382
|
Net income
|
2,308
|
|
1,984
|
|
2,271
|
|
8,798
|
|
8,724
|
Net income
attributable to common shareholders
|
2,137
|
|
1,839
|
|
2,114
|
|
8,208
|
|
8,361
|
Operating
performance
|
|
|
|
|
|
|
|
|
|
Basic earnings per
share ($)
|
1.76
|
|
1.51
|
|
1.72
|
|
6.72
|
|
6.90
|
Diluted earnings per
share ($)
|
1.73
|
|
1.50
|
|
1.71
|
|
6.68
|
|
6.82
|
Return on equity
(%)
|
13.3
|
|
11.5
|
|
13.8
|
|
13.1
|
|
14.5
|
Productivity ratio
(%)
|
54.1
|
|
55.0
|
|
54.6
|
|
53.9
|
|
52.3
|
Operating leverage
(%)
|
1.6
|
|
(5.9)
|
|
(4.1)
|
|
(3.3)
|
|
3.0
|
Core banking margin
(%)(2)
|
2.40
|
|
2.45
|
|
2.47
|
|
2.44
|
|
2.46
|
Financial position
information ($ millions)
|
|
|
|
|
|
|
|
|
|
Cash and deposits
with financial institutions
|
46,720
|
|
45,262
|
|
62,269
|
|
|
|
|
Trading
assets
|
127,488
|
|
131,068
|
|
100,262
|
|
|
|
|
Loans
|
592,483
|
|
589,243
|
|
551,834
|
|
|
|
|
Total
assets
|
1,086,161
|
|
1,066,740
|
|
998,493
|
|
|
|
|
Deposits
|
733,390
|
|
722,346
|
|
676,534
|
|
|
|
|
Common
equity
|
63,638
|
|
63,534
|
|
61,044
|
|
|
|
|
Preferred shares and
other equity instruments
|
3,884
|
|
3,884
|
|
4,184
|
|
|
|
|
Assets under
administration(3)
|
558,408
|
|
547,862
|
|
517,596
|
|
|
|
|
Assets under
management(3)
|
301,631
|
|
297,105
|
|
280,656
|
|
|
|
|
Capital and
liquidity measures
|
|
|
|
|
|
|
|
|
|
Common Equity Tier 1
(CET1) capital ratio (%)
|
11.1
|
|
11.2
|
|
11.1
|
|
|
|
|
Tier 1 capital ratio
(%)
|
12.2
|
|
12.3
|
|
12.5
|
|
|
|
|
Total capital ratio
(%)
|
14.2
|
|
14.8
|
|
14.3
|
|
|
|
|
Leverage ratio
(%)
|
4.2
|
|
4.2
|
|
4.5
|
|
|
|
|
CET1 risk-weighted
assets ($ millions)(4)
|
421,185
|
|
417,058
|
|
400,507
|
|
|
|
|
Liquidity coverage
ratio (LCR) (%)
|
125
|
|
123
|
|
124
|
|
|
|
|
Credit
quality
|
|
|
|
|
|
|
|
|
|
Net impaired loans
($ millions)
|
3,540
|
|
3,559
|
|
3,453
|
|
|
|
|
Allowance for credit
losses ($ millions)(5)
|
5,145
|
|
5,273
|
|
5,154
|
|
|
|
|
Net impaired loans as
a % of loans and acceptances
|
0.58
|
|
0.58
|
|
0.60
|
|
|
|
|
Provision for credit
losses as a % of average net loans and
acceptances(6)
|
0.50
|
|
0.48
|
|
0.39
|
|
0.51
|
|
0.48
|
Provision for credit
losses on impaired loans as a % of average net loans and
|
|
|
|
|
|
|
|
|
|
acceptances(6)
|
0.49
|
|
0.52
|
|
0.42
|
|
0.49
|
|
0.43
|
Net write-offs as a %
of average net loans and acceptances
|
0.49
|
|
0.50
|
|
0.45
|
|
0.50
|
|
0.44
|
Adjusted
results(2)
|
|
|
|
|
|
|
|
|
|
Adjusted net income
($ millions)
|
2,400
|
|
2,455
|
|
2,345
|
|
9,409
|
|
9,144
|
Adjusted diluted
earnings per share ($)
|
1.82
|
|
1.88
|
|
1.77
|
|
7.14
|
|
7.11
|
Adjusted return on
equity (%)
|
13.8
|
|
14.3
|
|
14.1
|
|
13.9
|
|
14.9
|
Adjusted productivity
ratio (%)
|
52.7
|
|
51.7
|
|
53.2
|
|
52.7
|
|
51.7
|
Adjusted operating
leverage (%)
|
(1.9)
|
|
1.1
|
|
(2.8)
|
|
(2.1)
|
|
3.7
|
Adjusted provision
for credit losses as a % of average net loans and
|
|
|
|
|
|
|
|
|
|
acceptances(6)
|
0.50
|
|
0.48
|
|
0.39
|
|
0.49
|
|
0.41
|
Common share
information
|
|
|
|
|
|
|
|
|
|
Closing share price
($) (TSX)
|
75.54
|
|
70.46
|
|
70.65
|
|
|
|
|
Shares outstanding
(millions)
|
|
|
|
|
|
|
|
|
|
Average -
Basic
|
1,218
|
|
1,221
|
|
1,230
|
|
1,222
|
|
1,213
|
Average -
Diluted
|
1,260
|
|
1,251
|
|
1,246
|
|
1,251
|
|
1,229
|
End of
period
|
1,216
|
|
1,220
|
|
1,227
|
|
|
|
|
Dividends paid per
share ($)
|
0.90
|
|
0.87
|
|
0.85
|
|
3.49
|
|
3.28
|
Dividend yield
(%)(7)
|
5.0
|
|
4.9
|
|
4.6
|
|
4.9
|
|
4.2
|
Market capitalization
($ millions) (TSX)
|
91,867
|
|
85,993
|
|
86,690
|
|
|
|
|
Book value per common
share ($)
|
52.33
|
|
52.06
|
|
49.75
|
|
|
|
|
Market value to book
value multiple
|
1.4
|
|
1.4
|
|
1.4
|
|
|
|
|
Price to earnings
multiple (trailing 4 quarters)
|
11.2
|
|
10.5
|
|
10.2
|
|
|
|
|
Other
information
|
|
|
|
|
|
|
|
|
|
Employees (full-time
equivalent)(3)
|
101,813
|
|
101,809
|
|
97,021
|
|
|
|
|
Branches and
offices
|
3,109
|
|
3,129
|
|
3,095
|
|
|
|
|
(1) The amounts
for period ended July 31, 2019 and October 31, 2019 have been
prepared in accordance with IFRS 15, prior period amounts have not
been restated.
|
(2) Refer to page
3 for a discussion of Non-GAAP measures.
|
(3) Prior period
amounts have been restated to conform with current period
presentation.
|
(4) In accordance
with OSFI's requirements, effective January 31, 2019, credit
valuation adjustment (CVA) risk-weighted assets (RWA) have been
fully phased-in. In the prior year,
|
CVA RWA were
calculated using scalars of 0.80, 0.83, and 0.86 to compute the
CET1 capital ratio, Tier 1 capital ratio and Total capital ratio,
respectively.
|
(5) Includes
allowance for credit losses on all financial assets – loans,
acceptances, off-balance sheet exposures, debt securities, and
deposits with financial institutions.
|
(6) Includes
provision for credit losses on certain financial assets – loans,
acceptances and off-balance sheet exposures.
|
(7) Based on the
average of the high and low common share price for the
period.
|
Impact of Foreign Currency Translation
The table below
reflects the estimated impact of foreign currency translation on
key income statement items.
|
Average exchange
rate
|
% Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
October
31
|
|
July 31
|
|
October 31
|
|
October 31,
2019
|
|
|
October 31,
2019
|
|
For the three months
ended
|
|
2019
|
|
2019
|
|
2018
|
|
vs. July 31,
2019
|
|
|
vs. October 31,
2018
|
|
U.S. Dollar/Canadian
Dollar
|
|
0.756
|
|
0.753
|
|
0.768
|
|
0.3
|
%
|
|
(1.5)
|
%
|
Mexican Peso/Canadian
Dollar
|
|
14.752
|
|
14.421
|
|
14.586
|
|
2.3
|
%
|
|
1.1
|
%
|
Peruvian Sol/Canadian
Dollar
|
|
2.542
|
|
2.497
|
|
2.542
|
|
1.8
|
%
|
|
-
|
%
|
Colombian
Peso/Canadian Dollar
|
|
2,583
|
|
2,454
|
|
2,326
|
|
5.3
|
%
|
|
11.0
|
%
|
Chilean Peso/Canadian
Dollar
|
|
542.205
|
|
519.551
|
|
516.094
|
|
4.4
|
%
|
|
5.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average exchange
rate
|
|
% Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
October
31
|
|
October 31
|
|
|
October 31,
2019
|
|
For the year
ended
|
|
|
|
|
|
2019
|
|
2018
|
|
|
vs. October 31,
2018
|
|
U.S. Dollar/Canadian
Dollar
|
|
|
|
|
|
0.753
|
|
0.777
|
|
|
(3.2)
|
%
|
Mexican Peso/Canadian
Dollar
|
|
|
|
|
|
14.607
|
|
14.802
|
|
|
(1.3)
|
%
|
Peruvian Sol/Canadian
Dollar
|
|
|
|
|
|
2.512
|
|
2.538
|
|
|
(1.0)
|
%
|
Colombian
Peso/Canadian Dollar
|
|
|
|
|
|
2,447
|
|
2,272
|
|
|
7.7
|
%
|
Chilean Peso/Canadian
Dollar
|
|
|
|
|
|
517.805
|
|
492.892
|
|
|
5.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the three months
ended
|
|
For the year
ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
October 31,
2019
|
|
October 31,
2019
|
|
|
October 31,
2019
|
|
Impact on net
income(1)($ millions except EPS)
|
|
vs. October 31,
2018
|
|
vs. July 31,
2019
|
|
|
vs. October 31,
2018
|
|
Net interest
income
|
|
|
|
|
$
|
(32)
|
$
|
(54)
|
|
$
|
(52)
|
|
Non-interest
income(2)
|
|
|
|
|
|
8
|
|
(45)
|
|
|
30
|
|
Non-interest
expenses
|
|
|
|
|
|
57
|
|
45
|
|
|
60
|
|
Other items (net of
tax)
|
|
|
|
|
|
4
|
|
22
|
|
|
22
|
|
Net income
|
|
|
|
|
$
|
37
|
$
|
(32)
|
|
$
|
60
|
|
Earnings per share
(diluted)
|
|
|
|
|
$
|
0.03
|
$
|
(0.03)
|
|
$
|
0.05
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impact by business
line ($ millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
Canadian
Banking
|
|
|
|
|
$
|
2
|
$
|
-
|
|
$
|
7
|
|
International
Banking(2)
|
|
|
|
|
|
41
|
|
(22)
|
|
|
51
|
|
Global Banking and
Markets
|
|
|
|
|
|
3
|
|
(2)
|
|
|
28
|
|
Other(2)
|
|
|
|
|
|
(9)
|
|
(8)
|
|
|
(26)
|
|
Net income
|
|
|
|
|
$
|
37
|
$
|
(32)
|
|
$
|
60
|
|
(1) Includes the
impact of all currencies.
|
(2) Includes the
impact of foreign currency hedges.
|
Group Financial Performance
Net income
Q4 2019 vs Q4 2018
Net income was $2,308 million, an
increase of $37 million or 2%.
Adjusting for Acquisition and divestiture-related amounts, net
income was $2,400 million, an
increase of $55 million or 2%, due
primarily to higher revenue.
Q4 2019 vs Q3 2019
Net income was $2,308 million, an
increase of $324 million or 16%.
Adjusting for Acquisition and divestiture-related amounts, net
income was $2,400 million, a decrease
of $55 million or 2%, due primarily
to higher provision for credit losses and higher non-interest
expenses, offset by lower income tax expense.
Net interest income
Q4 2019 vs Q4
2018
Net interest income was $4,336
million, an increase of $116
million or 3%, primarily from solid growth in assets and
deposits in Canadian Banking, commercial and retail lending in
International Banking, as well as higher corporate loans in Global
Banking and Markets. These increases were partly offset by lower
income contribution from asset/liability management activities, and
the negative impact of foreign currency translation.
The core banking margin was down seven basis points to 2.40%.
The decrease in margin was driven by lower spreads on
asset/liability management activities, and lower margins in
International Banking and Global Banking and Markets, partially
offset by higher margins in Canadian Banking.
Q4 2019 vs Q3 2019
Net interest income was $4,336
million, a decrease of $38
million or 1%, from lower asset/liability management
activities and the negative impact of foreign currency translation,
partly offset by strong asset growth in Canadian Banking.
The core banking margin of 2.40% was down five basis points. The
decrease in the margin was driven by lower spreads on
asset/liability management activities, lower margin contribution
from International Banking due mainly to unfavourable foreign
currency translation on higher margin assets, as well as lower
margins in Canadian Banking.
Non-interest income
Q4 2019 vs Q4
2018
Non-interest income was $3,632
million, up $404 million or
13%. Acquisitions contributed to approximately one quarter of the
growth. Other primary contributors to growth were higher banking
and wealth management revenues, underwriting and advisory fees, and
net gains on investments. These were partly offset by the impact of
the new revenue accounting standard that requires credit card
expenses to be netted against credit card revenue.
Q4 2019 vs Q3 2019
Non-interest income was up $347
million or 11%. Adjusting for the net gain on divestitures
in the current quarter and the loss on divestitures in the prior
quarter, non-interest income increased by $35 million or 1%. The growth was driven by
higher banking, underwriting and advisory, and wealth management
fees, partly offset by lower trading revenues and income from
associated corporations.
Provision for credit losses
Q4 2019 vs Q4
2018
The provision for credit losses was $753
million, an increase of $163
million or 28%, due to higher provisions in both the retail
and commercial portfolios in line with organic and acquisition
driven asset growth.
The provision for credit losses on impaired financial
instruments was $744 million, up
$107 million due to higher retail
portfolio provisions in International Banking in line with growth
and in Canadian Banking due to lower recoveries, as well as higher
commercial portfolio provisions in Canadian Banking and in Global
Banking and Markets due to lower recoveries. Commercial portfolio
provisions in International Banking remained relatively stable,
with the provision relating to the Barbados debt restructuring being offset with
higher recoveries last year. The provision for credit losses ratio
on impaired loans was 49 basis points, an increase of seven basis
points. The provision on performing financial instruments was
$9 million, an increase of
$56 million due primarily to
hurricane-related reversals last year and retail portfolio growth.
The provision for credit losses ratio increased 11 basis points to
50 basis points.
Q4 2019 vs Q3 2019
The provision for credit losses was $753
million, an increase of $40
million.
The provision on impaired financial instruments decreased
$32 million or 4%, due primarily to
lower retail portfolio provisions driven by lower write-offs in
Canada and credit quality
improvements in International Banking, partially offset by higher
commercial portfolio provisions in Canadian Banking and Global
Banking and Markets. The provision for credit losses ratio on
impaired loans was 49 basis points, a decrease of three basis
points. The provision for performing financial instruments was
$9 million, an increase of
$72 million mainly in the
International Banking retail portfolio driven by less favourable
macroeconomic impacts due to geopolitical uncertainty and
hurricanes in the Bahamas. The
prior quarter benefitted from credit quality improvements. The
provision for credit losses ratio increased two basis points to 50
basis points.
Non-interest expenses
Q4 2019 vs Q4
2018
Non-interest expenses were $4,311
million, up $247 million or
6%. Adjusting for Acquisition and divestiture-related
amounts, non-interest expenses also grew by 6%. Higher non-interest
expenses from the impact of acquisitions, partly offset by the
impact of the new revenue accounting standard that requires card
expenses to be netted against card revenues, contributed to
approximately 1% of the growth. The remaining 5% increase was due
to higher salaries and benefits related to regulatory and
technology initiatives and higher depreciation and amortization,
performance based compensation and other business growth related
expenses. Partly offsetting were lower professional fees and the
positive impact of foreign currency translation.
The productivity ratio was 54.1% compared to 54.6%. Adjusting
for Acquisition and divestiture-related amounts, the productivity
ratio was 52.7% compared to 53.2%.
Q4 2019 vs Q3 2019
Non-interest expenses were up $102
million or 2%. Adjusting for Acquisition and
divestiture-related amounts, non-interest expenses also grew by
2%. The increase was due to higher professional fees,
technology costs and other business growth related expenses partly
offset by lower share-based compensation costs, salaries and the
positive impact of foreign currency translation.
The productivity ratio was 54.1% compared to 55.0%.
Income taxes
Q4 2019 vs Q4 2018
The
effective tax rate was 20.5% compared to 18.7% due primarily to
higher taxes in certain foreign jurisdictions.
Q4 2019 vs Q3 2019
The effective tax rate
decreased to 20.5% from 27.5% due primarily to higher taxes related
to the loss on the announced divestiture of Puerto Rico in the prior quarter.
Common Dividend
The Board of Directors at its meeting on November 25, 2019 approved the quarterly dividend
of 90 cents per common share. This
quarterly dividend applies to shareholders of record as of
January 7, 2020 and is payable
January 29, 2020.
Capital Ratios
The Bank continues to maintain strong, high quality capital
levels which position it well for future business growth. The
Common Equity Tier 1 (CET1) ratio as at October 31, 2019 was 11.1%, remaining flat from
prior year due primarily to strong internal capital generation
which was offset by strong risk-weighted asset growth, share
buybacks under the Bank's Normal Course Issuer Bid, the impact from
employee pension and retirement benefits on accumulated other
comprehensive income, and the impact from the Bank's acquisitions
during the year.
The Bank's Tier 1 capital ratio was 12.2% as at October 31, 2019, a decline of approximately 30
basis points from the prior year, primarily due to the redemptions
of $650 million of Scotiabank Tier 1
Trust Securities and $300 million of
preferred shares. The Total capital ratio was 14.2% as at
October 31, 2019, a decline of 10
basis points from 2018, due primarily to the redemptions of Tier 1
capital noted above and the redemption of $1.75 billion of subordinated debentures. These
redemptions were partly offset by the issuances of $3.25 billion of subordinated debentures during
the year. The Leverage ratio was 4.2%, a decline of approximately
30 basis points in 2019 due primarily to the Bank's acquisitions
and strong organic asset growth.
The Bank's capital ratios continue to be well in excess of
OSFI's minimum capital ratio requirements for 2019 (including the
1% D-SIB surcharge and 2% Domestic Stability Buffer requirements)
of 10.0%, 11.5% and 13.5% for CET1, Tier 1 and Total Capital,
respectively. The Bank was well above the OSFI minimum
Leverage ratio as at October 31,
2019.
Business Segment Review
Canadian Banking
|
For the three months
ended
|
|
For the year
ended
|
(unaudited) ($
millions)
|
|
October
31
|
|
|
July 31
|
|
|
October 31
|
|
|
October
31
|
|
|
October 31
|
(Taxable
equivalent basis)(1)
|
|
2019
|
(2)
|
|
2019
|
(2)
|
|
2018
|
|
|
2019
|
(2)
|
|
2018
|
Reported
Results
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
$
|
2,138
|
|
$
|
2,120
|
|
$
|
2,029
|
|
$
|
8,284
|
|
$
|
7,898
|
Non-interest
income(3)(4)
|
|
1,428
|
|
|
1,412
|
|
|
1,414
|
|
|
5,609
|
|
|
5,452
|
Total
revenue
|
|
3,566
|
|
|
3,532
|
|
|
3,443
|
|
|
13,893
|
|
|
13,350
|
Provision for credit
losses
|
|
247
|
|
|
240
|
|
|
198
|
|
|
972
|
|
|
794
|
Non-interest
expenses
|
|
1,779
|
|
|
1,723
|
|
|
1,747
|
|
|
6,943
|
|
|
6,654
|
Income tax
expense
|
|
397
|
|
|
409
|
|
|
383
|
|
|
1,554
|
|
|
1,538
|
Net
income
|
$
|
1,143
|
|
$
|
1,160
|
|
$
|
1,115
|
|
$
|
4,424
|
|
$
|
4,364
|
Net income
attributable to equity holders of the Bank
|
$
|
1,143
|
|
$
|
1,160
|
|
$
|
1,115
|
|
$
|
4,424
|
|
$
|
4,364
|
Other
measures
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on
equity
|
|
19.0%
|
|
|
19.5%
|
|
|
21.3%
|
|
|
18.8%
|
|
|
22.7%
|
Assets under
administration ($ billions)(5)
|
$
|
386
|
|
$
|
382
|
|
$
|
357
|
|
$
|
386
|
|
$
|
357
|
Assets under
management ($ billions)(5)
|
$
|
243
|
|
$
|
240
|
|
$
|
223
|
|
$
|
243
|
|
$
|
223
|
Average assets ($
billions)
|
$
|
372
|
|
$
|
365
|
|
$
|
349
|
|
$
|
363
|
|
$
|
342
|
Average liabilities
($ billions)
|
$
|
292
|
|
$
|
285
|
|
$
|
263
|
|
$
|
283
|
|
$
|
254
|
(1) Results are
presented on a taxable equivalent basis. Refer to Business Line
Overview section of the Bank's 2019 Annual Report.
|
(2) The amounts
for period ended July 31, 2019 and October 31, 2019 have been
prepared in accordance with IFRS 15, prior year amounts have not
been restated.
|
(3) Includes net
income from investments in associated corporations for the three
months ended October 31, 2019 - $18 (July 31, 2019 - $16; October
31, 2018 - $23)
|
and for the year
ended October 31, 2019 - $65 (October 31, 2018 -
$93).
|
(4) Includes one
additional month of earnings relating to the Canadian insurance
business of $34 (after tax $25) in the second quarter of
2018.
|
(5) Prior period
amounts have been restated to conform with current period
presentation.
|
|
For the three months
ended
|
For the year
ended
|
(unaudited) ($
millions)
|
|
October
31
|
|
July 31
|
|
October 31
|
|
October
31
|
|
October 31
|
(Taxable
equivalent basis)
|
|
2019
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Adjusted
Results(1)
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
$
|
2,138
|
$
|
2,120
|
$
|
2,029
|
$
|
8,284
|
$
|
7,898
|
Non-interest
income
|
|
1,428
|
|
1,412
|
|
1,414
|
|
5,609
|
|
5,452
|
Total
revenue
|
|
3,566
|
|
3,532
|
|
3,443
|
|
13,893
|
|
13,350
|
Provision for credit
losses
|
|
247
|
|
240
|
|
198
|
|
972
|
|
794
|
Non-interest
expenses
|
|
1,755
|
|
1,705
|
|
1,705
|
|
6,860
|
|
6,583
|
Income tax
expense
|
|
404
|
|
413
|
|
394
|
|
1,576
|
|
1,557
|
Net
income
|
$
|
1,160
|
$
|
1,174
|
$
|
1,146
|
$
|
4,485
|
$
|
4,416
|
(1) Refer to
Non-GAAP Measures for the reconciliation of reported and adjusted
results.
|
Net income
Q4 2019 vs Q4 2018
Net income attributable to equity holders was $1,143 million, an increase of 3%. Adjusting for
Acquisition-related costs, net income was $1,160 million compared to $1,146 million, up 1%. The increase was due
primarily to strong asset and deposit growth, margin expansion, and
the impact of acquisitions, partially offset by higher provisions
for credit losses and higher non-interest expenses. Lower real
estate gains reduced earnings growth by 2%.
Q4 2019 vs Q3 2019
Net income attributable to equity holders declined $17 million or 1% due primarily to higher
non-interest expenses, higher provision for credit losses, and net
interest margin compression, partially offset by asset and deposit
growth and higher wealth management fees.
Net interest income
Q4 2019 vs Q4
2018
Net interest income of $2,138
million was up $109 million or
5%. This was driven by solid growth in assets and deposits,
and an increase in net interest margin. The margin improved two
basis points to 2.47% primarily driven by the impact of prior
interest rate increases by the Bank of Canada.
Q4 2019 vs Q3 2019
Net interest income increased $18
million or 1%, due to asset and deposit growth, partially
offset by a decrease of two basis points in the net interest margin
mainly due to lower residential mortgage and retail deposit
margins.
Non-interest income
Q4 2019 vs Q4
2018
Non-interest income of $1,428
million increased $14 million
or 1%. Higher wealth management fee income was partly offset
by reduced net card revenue due to the impact of the new revenue
accounting standard and lower gains on sale of real estate.
Q4 2019 vs Q3 2019
Non-interest income increased $16
million or 1% primarily driven by higher wealth management
fee income.
Provision for credit losses
Q4 2019 vs Q4
2018
The provision for credit losses was $247
million, compared to $198
million. The provision on impaired loans was $255 million compared to $188 million, up 36% due to higher retail and
commercial provisions in line with asset growth and lower
recoveries. The provision for credit losses ratio on impaired loans
was 28 basis points, an increase of six basis points. The provision
on performing loans decreased $18
million due primarily to lower commercial provisions driven
by improved credit quality. The provision for credit losses ratio
was 27 basis points, an increase of four basis points.
Q4 2019 vs Q3 2019
The provision for credit losses was $247
million, compared to $240
million. The provision on impaired loans was $255 million, in line with the last quarter. The
provision for credit losses ratio on impaired loans was 28 basis
points, a decrease of one basis point. The provision on performing
loans increased by $8 million due
primarily to higher retail provisions driven by prior quarter
credit quality improvements partially offset by lower commercial
provisions from improved credit quality in the current quarter. The
provision for credit losses ratio remained unchanged at 27 basis
points.
Non-interest expenses
Q4 2019 vs Q4
2018
Non-interest expenses were $1,779
million, up $32 million or 2%
largely relating to the impact of prior year acquisitions. Higher
personnel costs to support business development and regulatory
initiatives were partly offset by the impact of the new revenue
accounting standard.
Q4 2019 vs Q3 2019
Non-interest expenses increased $56
million or 3%, largely driven by higher personnel and
technology costs to support business development and regulatory
initiatives.
Income taxes
Q4 2019 vs Q4 2018
The effective tax rate was 25.8%, slightly higher than the
previous year of 25.6%.
Q4 2019 vs Q3 2019
The effective tax rate was 25.8%, slightly lower than the
previous quarter of 26.1%.
Average Assets
Q4 2019 vs Q4 2018
Average assets grew $23 billion or
7% to $372 billion, primarily driven
by growth in residential mortgages, which grew $10 billion or 5%. Business loans and acceptances
grew $6 billion or 11%, while
personal loans grew $2 billion or
3%.
Q4 2019 vs Q3 2019
Average assets increased $7
billion or 2%. The growth included $5
billion or 2% in residential mortgages, $1 billion or 2% in business loans and
acceptances and personal loans grew $1
billion or 2%.
Average Liabilities
Q4 2019 vs Q4
2018
Average liabilities increased $29
billion or 11%. This was driven by strong growth of
$13 billion or 16% growth in
non-personal deposits and $10 billion
or 6% in personal deposits.
Q4 2019 vs Q3 2019
Average liabilities increased $7
billion or 2%, primarily driven by growth of $5 billion or 5% in in non-personal deposits.
Assets under administration (AUA) and assets under management
(AUM)
Q4 2019 vs Q4 2018
AUM of $243 billion increased
$20 billion or 9% and AUA of
$386 billion increased $29 billion or 8%, primarily driven by higher net
sales and market appreciation.
Q4 2019 vs Q3 2019
AUM of $243 billion increased
$3 billion or 1% and AUA of
$386 billion increased $4 billion or 1%, primarily driven by higher net
sales and market appreciation.
International Banking
|
For the three months
ended
|
|
For the year
ended
|
(unaudited) ($
millions)
|
|
October
31
|
|
|
July 31
|
|
|
October 31
|
|
|
October
31
|
|
|
October 31
|
(Taxable
equivalent basis)(1)
|
|
2019
|
(2)
|
|
2019
|
(2)
|
|
2018
|
|
|
2019
|
(2)
|
|
2018
|
Reported
Results
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
$
|
2,124
|
|
$
|
2,157
|
|
$
|
2,030
|
|
$
|
8,482
|
|
$
|
7,322
|
Non-interest
income(3)(4)
|
|
1,250
|
|
|
1,270
|
|
|
1,104
|
|
|
5,006
|
|
|
4,111
|
Total
revenue
|
|
3,374
|
|
|
3,427
|
|
|
3,134
|
|
|
13,488
|
|
|
11,433
|
Provision for credit
losses(5)
|
|
502
|
|
|
476
|
|
|
412
|
|
|
2,076
|
|
|
1,867
|
Non-interest
expenses
|
|
1,795
|
|
|
1,780
|
|
|
1,721
|
|
|
7,027
|
|
|
6,111
|
Income tax
expense
|
|
254
|
|
|
269
|
|
|
197
|
|
|
998
|
|
|
706
|
Net
income
|
$
|
823
|
|
$
|
902
|
|
$
|
804
|
|
$
|
3,387
|
|
$
|
2,749
|
Net income
attributable to non-controlling interests in
subsidiaries
|
|
90
|
|
|
121
|
|
|
92
|
|
|
391
|
|
|
176
|
Net income
attributable to equity holders of the Bank
|
$
|
733
|
|
$
|
781
|
|
$
|
712
|
|
$
|
2,996
|
|
$
|
2,573
|
Other
measures
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on
equity(6)
|
|
13.7%
|
|
|
14.1%
|
|
|
14.3%
|
|
|
13.9%
|
|
|
14.4%
|
Average assets ($
billions)
|
$
|
207
|
|
$
|
206
|
|
$
|
193
|
|
$
|
203
|
|
$
|
168
|
Average liabilities
($ billions)
|
$
|
160
|
|
$
|
158
|
|
$
|
153
|
|
$
|
157
|
|
$
|
131
|
(1) Results are
presented on a taxable equivalent basis. Refer to Business Line
Overview section of the Bank's 2019 Annual Report.
|
(2) The amounts
for period ended July 31, 2019 and October 31, 2019 have been
prepared in accordance with IFRS 15, prior year amounts have not
been restated.
|
(3) Includes net
income from investments in associated corporations for the three
months ended October 31, 2019 - $210 (July 31, 2019 - $182; October
31, 2018 - $201)
|
and for the year
ended October 31, 2019 - $763 (October 31, 2018 -
$643).
|
(4) Includes one
additional month of earnings relating to Peru of $58 (after tax and
NCI $41) in the first quarter of 2019. The fourth quarter of 2018,
includes one additional month
|
of earnings
related to Thanachart Bank $30 (after tax $22). The second quarter
of 2018, includes one additional month of earnings related to Chile
$36 (after tax $26).
|
(5) Includes Day 1
provision for credit losses on acquired performing loans for the
year ended October 31, 2019 - $151 (October 31, 2018 -
$404).
|
(6) Adjusting for
Acquisition-related costs, return on equity was 14.7% for the three
months ended October 31, 2019 (July 31, 2019 - 14.7%; October 31,
2018 - 15.0%) and for the
|
year ended October
31, 2019 - 14.8% (October 31, 2018 - 15.8%).
|
|
|
|
|
|
|
|
|
|
|
For the three months
ended
|
For the year
ended
|
(unaudited) ($
millions)
|
|
October
31
|
|
|
July 31
|
|
|
October 31
|
|
|
October
31
|
|
|
October 31
|
(Taxable
equivalent basis)
|
|
2019
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
Adjusted
Results(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
$
|
2,124
|
|
$
|
2,157
|
|
$
|
2,030
|
|
$
|
8,482
|
|
$
|
7,322
|
Non-interest
income
|
|
1,250
|
|
|
1,270
|
|
|
1,104
|
|
|
5,006
|
|
|
4,111
|
Total
revenue
|
|
3,374
|
|
|
3,427
|
|
|
3,134
|
|
|
13,488
|
|
|
11,433
|
Provision for credit
losses
|
|
502
|
|
|
476
|
|
|
412
|
|
|
1,925
|
|
|
1,463
|
Non-interest
expenses
|
|
1,712
|
|
|
1,725
|
|
|
1,661
|
|
|
6,816
|
|
|
5,995
|
Income tax
expense
|
|
277
|
|
|
285
|
|
|
214
|
|
|
1,102
|
|
|
858
|
Net
income
|
$
|
883
|
|
$
|
941
|
|
$
|
847
|
|
$
|
3,645
|
|
$
|
3,117
|
Net income
attributable to non-controlling interests in
subsidiaries
|
|
102
|
|
|
126
|
|
|
101
|
|
|
457
|
|
|
298
|
Net income
attributable to equity holders of the Bank
|
$
|
781
|
|
$
|
815
|
|
$
|
746
|
|
$
|
3,188
|
|
$
|
2,819
|
(1) Refer to
Non-GAAP Measures for the reconciliation of reported and adjusted
results.
|
Net income
Q4 2019 vs Q4 2018
Net income attributable to equity holders of $733 million was up $21
million, or 3%. Adjusting for Acquisition-related costs, net
income increased to $781 million, up
5%. This growth was largely driven by higher net interest income
due to strong loan growth in Pacific Alliance countries, and higher
non-interest income. This was partially offset by increased
provisions for credit losses as last year benefited from recoveries
in Puerto Rico and Latin America, higher non-interest expenses
and income taxes. The Alignment of reporting period in Thailand last year, impacted the adjusted
earnings growth by 3%.
Q4 2019 vs Q3 2019
Net income attributable to equity holders decreased by
$48 million or 6%. Adjusting for
Acquisition-related costs, net income decreased by $34 million or 4% driven by higher provision for
credit losses and lower investment gains, partially offset by good
growth in banking and card fees.
Financial performance on a Constant Dollar Basis
The discussion below on the results of operations is on a
constant dollar basis that excludes the impact of foreign currency
translation, and is a non-GAAP financial measure (refer to Non-GAAP
Measures). The Bank believes that reporting in constant dollars is
useful for readers in assessing ongoing business performance.
Ratios are on a reported basis.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the three months
ended
|
For the year
ended
|
($ millions)
(unaudited)
|
July 31,
2019
|
October 31,
2018
|
October 31,
2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign
|
|
Constant
|
|
|
|
Foreign
|
|
Constant
|
|
|
|
Foreign
|
|
Constant
|
(Taxable
equivalent basis)
|
|
Reported
|
|
exchange
|
|
dollar
|
|
Reported
|
|
exchange
|
|
dollar
|
|
Reported
|
|
exchange
|
|
dollar
|
Net interest
income
|
$
|
2,157
|
$
|
52
|
$
|
2,105
|
$
|
2,030
|
$
|
46
|
$
|
1,984
|
$
|
7,322
|
$
|
27
|
$
|
7,295
|
Non-interest
income
|
|
1,270
|
|
13
|
|
1,257
|
|
1,104
|
|
8
|
|
1,096
|
|
4,111
|
|
13
|
|
4,098
|
Total
revenue
|
|
3,427
|
|
65
|
|
3,362
|
|
3,134
|
|
54
|
|
3,080
|
|
11,433
|
|
40
|
|
11,393
|
Provision for credit
losses
|
|
476
|
|
13
|
|
463
|
|
412
|
|
17
|
|
395
|
|
1,867
|
|
52
|
|
1,815
|
Non-interest
expenses
|
|
1,780
|
|
41
|
|
1,739
|
|
1,721
|
|
44
|
|
1,677
|
|
6,111
|
|
54
|
|
6,057
|
Income tax
expense
|
|
269
|
|
2
|
|
267
|
|
197
|
|
(2)
|
|
199
|
|
706
|
|
(15)
|
|
721
|
Net
income
|
$
|
902
|
$
|
9
|
$
|
893
|
$
|
804
|
$
|
(5)
|
$
|
809
|
$
|
2,749
|
$
|
(51)
|
$
|
2,800
|
Net income
attributable to
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
non-controlling
interest
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
in
subsidiaries
|
$
|
121
|
$
|
5
|
$
|
116
|
$
|
92
|
$
|
5
|
$
|
87
|
$
|
176
|
$
|
(1)
|
$
|
177
|
Net income
attributable to equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
holders of the
Bank
|
$
|
781
|
$
|
4
|
$
|
777
|
$
|
712
|
$
|
(10)
|
$
|
722
|
$
|
2,573
|
$
|
(50)
|
$
|
2,623
|
Other
measures
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average assets ($
billions)
|
$
|
206
|
$
|
4
|
$
|
202
|
$
|
193
|
$
|
3
|
$
|
190
|
$
|
168
|
$
|
1
|
$
|
167
|
Average liabilities
($ billions)
|
$
|
158
|
$
|
3
|
$
|
155
|
$
|
153
|
$
|
3
|
$
|
150
|
$
|
131
|
$
|
-
|
$
|
131
|
The above table is
computed on a basis that is different than the table "Impact of
Foreign Currency Translation" on page 10.
|
Net income
Q4 2019 vs Q4 2018
Net income attributable to equity holders of $733 million was up $11
million or 1%. Adjusting for Acquisition-related costs, net
income increased to $781 million, up
4%. This growth was largely driven by higher net interest income
due to strong loan growth in Pacific Alliance countries, and higher
non-interest income. This was partially offset by increased
provisions for credit losses due to higher recoveries in
Puerto Rico and Latin America last year, higher non-interest
expenses and income taxes. The Alignment of reporting period in
Thailand last year, impacted the
adjusted earnings growth by 3%.
Q4 2019 vs Q3 2019
Net income attributable to equity holders decreased by
$44 million or 6%. Adjusting for
Acquisition-related costs, net income decreased by $30 million or 4%, driven by higher provision for
credit losses and lower investment gains, partially offset by good
growth in banking and card fees.
Net interest income
Q4 2019 vs Q4
2018
Net interest income was $2,124
million, up $140 million or 7%
driven by good retail and commercial loan growth. Net interest
margin decreased by nine basis points to 4.43% due to margin
compression in Mexico and
Chile.
Q4 2019 vs Q3 2019
Net interest income increased $19
million or 1% in line with loan growth. Net interest margin
decreased by two basis points driven by margin compression in
Chile.
Non-interest income
Q4 2019 vs Q4
2018
Non-interest income was $1,250
million, up $154 million or
14% driven by higher banking fees and higher investment gains.
Q4 2019 vs Q3 2019
Non-interest income decreased $7
million or 1% impacted by lower trading revenues, partially
offset by higher banking fees, card fees, and increased
contribution from associated corporations.
Provision for credit losses
Q4 2019 vs Q4
2018
The provision for credit losses was $502
million, compared to $395
million. The provision on impaired loans was $477 million compared to $449 million, up 6% due primarily to volume
growth in the retail portfolios. The provision for credit losses
ratio on impaired loans was 126 basis points, an increase of six
basis points. The provision on performing loans increased
$80 million due primarily to
hurricane-related provision reversals and the benefits of credit
quality improvements in the prior year. The provision for credit
losses ratio was 134 basis points, an increase of 29 basis
points.
Q4 2019 vs Q3 2019
The provision for credit losses was $502
million, compared to $463
million. The provision on impaired loans was $477 million compared to $506 million, down 6% in both the retail and
commercial portfolios. The provision for credit losses ratio on
impaired loans decreased 10 basis points to 126 basis points. The
provision on performing loans increased $68
million driven mainly by less favourable macroeconomic
impacts due to geopolitical uncertainty, the prior quarter benefits
due to credit quality improvements, and hurricanes in the
Bahamas. The provision for credit
losses ratio was 134 basis points, an increase of 10 basis
points.
Non-interest expenses
Q4 2019 vs Q4
2018
Non-interest expenses increased $118
million or 7% to $1,795
million. Adjusting for Acquisition-related costs,
non-interest expenses increased 6%, due to business volume growth,
higher technology costs and regulatory costs, partially offset by
acquisition-related synergies.
Q4 2019 vs Q3 2019
Non-interest expenses increased $56
million, or 3%. Adjusting for Acquisition-related
costs, non-interest expenses increased by $24 million or up 1%, due to business volume
growth.
Income taxes
Q4 2019 vs Q4 2018
Adjusting for Acquisition-related costs, the effective tax rate
increased to 24.0% from 20.2% last year due primarily to lower tax
benefits in Mexico and lower
inflation in Chile.
Q4 2019 vs Q3 2019
Adjusting for Acquisition-related costs, the effective tax rate
increased to 24.0% from 23.2% mainly driven by lower inflation in
Mexico and Chile.
Average Assets
Q4 2019 vs Q4 2018
Average assets of $207 billion
grew $17 billion or 9%, driven by
good loan growth of 8%, primarily in the Pacific Alliance
countries. Retail and commercial loan growth were 8% and 7%,
respectively.
Q4 2019 vs Q3 2019
Average assets increased by 3%, driven by good loan growth in
the Pacific Alliance countries. Retail and commercial loan growth
both grew at 1%.
Average Liabilities
Q4 2019 vs Q4
2018
Average liabilities of $160
billion increased $10 billion
with deposit growth of 5%, primarily in the Pacific Alliance
countries and Dominican
Republic.
Q4 2019 vs Q3 2019
Average liabilities were up $5
billion driven by deposit growth of 1%.
Global Banking and Markets
|
For the three months
ended
|
For the year
ended
|
(unaudited) ($
millions)
(Taxable
equivalent basis)(1)
|
|
October
31
|
|
|
July 31
|
|
|
October 31
|
|
|
October
31
|
|
|
October 31
|
|
2019
|
(2)
|
|
2019
|
(2)
|
|
2018
|
|
|
2019
|
(2)
|
|
2018
|
Reported
Results
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
$
|
337
|
|
$
|
337
|
|
$
|
337
|
|
$
|
1,396
|
|
$
|
1,454
|
Non-interest
income
|
|
833
|
|
|
747
|
|
|
736
|
|
|
3,084
|
|
|
3,074
|
Total
revenue
|
|
1,170
|
|
|
1,084
|
|
|
1,073
|
|
|
4,480
|
|
|
4,528
|
Provision for credit
losses
|
|
4
|
|
|
(4)
|
|
|
(20)
|
|
|
(22)
|
|
|
(50)
|
Non-interest
expenses
|
|
631
|
|
|
593
|
|
|
553
|
|
|
2,463
|
|
|
2,233
|
Income tax
expense
|
|
130
|
|
|
121
|
|
|
124
|
|
|
505
|
|
|
587
|
Net
income
|
$
|
405
|
|
$
|
374
|
|
$
|
416
|
|
$
|
1,534
|
|
$
|
1,758
|
Net income
attributable to equity holders of the Bank
|
$
|
405
|
|
$
|
374
|
|
$
|
416
|
|
$
|
1,534
|
|
$
|
1,758
|
Other
measures
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on
equity
|
|
13.8%
|
|
|
12.8%
|
|
|
15.3%
|
|
|
13.3%
|
|
|
16.0%
|
Average assets ($
billions)
|
$
|
388
|
|
$
|
374
|
|
$
|
318
|
|
$
|
372
|
|
$
|
321
|
Average liabilities
($ billions)
|
$
|
318
|
|
$
|
306
|
|
$
|
259
|
|
$
|
304
|
|
$
|
265
|
(1) Results are
presented on a taxable equivalent basis. Refer to Business Line
Overview section of the Bank's 2019 Annual Report.
|
(2) The amounts
for period ended October 31, 2019 and July 31, 2019 have been
prepared in accordance with IFRS 15, prior year amounts have not
been restated.
|
Net income
Q4 2019 vs Q4 2018
Net income attributable to equity holders was $405 million, a decrease of $11 million or 3%. Higher non-interest expenses
and higher provision for credit losses were partially offset by
higher non-interest income and the favourable impact of foreign
currency translation.
Q4 2019 vs Q3 2019
Net income attributable to equity holders increased by
$31 million or 8%. This was due
mainly to higher non-interest income, partially offset by higher
non-interest expenses and higher provision for credit losses.
Net interest income
Q4 2019 vs Q4
2018
Net interest income was $337
million, in line with the prior year. Strong growth in
corporate loans and deposits was offset by lower net interest
margin. The net interest margin decreased 13 basis points due
mainly to lower lending margins and deposit margin compression.
Q4 2019 vs Q3 2019
Net interest income was in line with the prior quarter. The
impact of higher loan and deposit volumes was offset by a two basis
point decline in net interest margin.
Non-interest income
Q4 2019 vs Q4
2018
Non-interest income was $833
million, an increase of $97
million from prior year. This increase was due mainly to
strong growth in fixed income trading revenues, higher underwriting
fees and credit fees.
Q4 2019 vs Q3 2019
Non-interest income was up $86
million or 12%. This growth was due mainly to stronger fixed
income trading revenues and higher underwriting and advisory
fees.
Provision for credit losses
Q4 2019 vs Q4
2018
The provision for credit losses increased $24 million due primarily to higher recoveries in
Europe in the prior year. The
provision for credit losses ratio was two basis points, an increase
of 11 basis points.
Q4 2019 vs Q3 2019
The provision for credit losses was $4
million, compared to a net reversal of $4 million last quarter. The provision on
impaired loans was $12 million due
primarily to higher provisions in Canada. The provision for credit losses ratio
on impaired loans was five basis points, an increase of six basis
points. The provision on performing loans was a net reversal of
$8 million due primarily to
improvement in credit quality. The provision for credit losses
ratio was two basis points, an increase of three basis points.
Non-interest expenses
Q4 2019 vs Q4
2018
Non-interest expenses of $631
million increased $78 million
or 14%. The increase was driven by compliance and technology
investments driven by regulatory requirements and higher
performance and share-based compensation.
Q4 2019 vs Q3 2019
Non-interest expenses increased $38
million or 6% due mainly to higher performance-based
compensation and an increase in professional fees.
Income taxes
Q4 2019 vs Q4 2018
The effective tax rate was 24.3%, compared to 22.9% due mainly
to the change in income mix in certain foreign jurisdictions.
Q4 2019 vs Q3 2019
The effective tax rate for the quarter was 24.3%, in line with
the prior quarter.
Average Assets
Q4 2019 vs Q4 2018
Average assets were $388 billion,
an increase of $70 billion or 22%.
This increase was due primarily to growth in securities purchased
under resale agreements, trading securities, business and
government loans as well as the impact of foreign currency
translation.
Q4 2019 vs Q3 2019
Average assets increased $14
billion or 4% due mainly to growth in securities purchased
under resale agreements and trading securities.
Average Liabilities
Q4 2019 vs Q4
2018
Average liabilities of $318
billion were higher by $59
billion or 23% due to increased securities sold under
repurchase agreements and deposits, as well as the impact of
foreign currency translation.
Q4 2019 vs Q3 2019
Average liabilities increased $12
billion or 4% due primarily to higher deposits.
Other
|
For the three months
ended
|
For the year
ended
|
(unaudited) ($
millions)
|
|
October
31
|
|
July 31
|
|
October 31
|
|
October
31
|
|
October 31
|
(Taxable
equivalent basis)(1)
|
|
2019
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Reported
Results
|
|
|
|
|
|
|
|
|
|
|
Net interest
income(2)
|
$
|
(263)
|
$
|
(240)
|
$
|
(176)
|
$
|
(985)
|
$
|
(483)
|
Non-interest
income(2)(3)
|
|
121
|
|
(144)
|
|
(26)
|
|
158
|
|
(53)
|
Total
revenue
|
|
(142)
|
|
(384)
|
|
(202)
|
|
(827)
|
|
(536)
|
Provision for credit
losses
|
|
-
|
|
1
|
|
-
|
|
1
|
|
-
|
Non-interest
expenses
|
|
106
|
|
113
|
|
43
|
|
304
|
|
60
|
Income tax
expense(2)(3)
|
|
(185)
|
|
(46)
|
|
(181)
|
|
(585)
|
|
(449)
|
Net income
(loss)
|
$
|
(63)
|
$
|
(452)
|
$
|
(64)
|
$
|
(547)
|
$
|
(147)
|
Net income (loss)
attributable to non-controlling interests in s
ubsidiaries
|
|
17
|
|
(1)
|
|
-
|
|
17
|
|
-
|
Net income (loss)
attributable to equity holders of the Bank
|
$
|
(80)
|
$
|
(451)
|
$
|
(64)
|
$
|
(564)
|
$
|
(147)
|
Other
measures
|
|
|
|
|
|
|
|
|
|
|
Average assets ($
billions)
|
$
|
124
|
$
|
116
|
$
|
111
|
$
|
118
|
$
|
115
|
Average liabilities
($ billions)
|
$
|
251
|
$
|
242
|
$
|
229
|
$
|
243
|
$
|
232
|
(1) Results are
presented on a taxable equivalent basis. Refer to Business Line
Overview section of the Bank's 2019 Annual Report.
|
(2) Includes the
elimination of the tax-exempt income gross-up reported in net
interest income, non-interest income and provision for income taxes
for the three months ended
|
October 31, 2019 -
$58 (July 31, 2019 - $48; October 31, 2018 - $31), and the years
ended October 31, 2019 - $181 (October 31, 2018 - $112) to arrive
at the amounts reported in the
|
Consolidated
Statement of Income.
|
(3) Income (on a
taxable equivalent basis) from investments in associated
corporations and the provision for income taxes in each period
include the tax normalization adjustments
|
related to the
gross-up of income from associated companies for the three months
ended October 31, 2019 - $(67) (July 31, 2019 - $(8); October 31,
2018 - $(55)) and for the year
|
ended October 31,
2019 - $(178) (October 31, 2018 - $(177)).
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the three months
ended
|
For the year
ended
|
(unaudited) ($
millions)
|
|
October
31
|
|
July 31
|
|
October 31
|
|
October
31
|
|
October 31
|
(Taxable
equivalent basis)
|
|
2019
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Adjusted
Results(1)
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
$
|
(263)
|
$
|
(240)
|
$
|
(176)
|
$
|
(985)
|
$
|
(483)
|
Non-interest
income
|
|
115
|
|
162
|
|
(26)
|
|
285
|
|
(53)
|
Total
revenue
|
|
(148)
|
|
(78)
|
|
(202)
|
|
(700)
|
|
(536)
|
Provision for credit
losses
|
|
-
|
|
1
|
|
-
|
|
1
|
|
-
|
Non-interest
expenses
|
|
99
|
|
99
|
|
43
|
|
283
|
|
60
|
Income tax
expense
|
|
(199)
|
|
(144)
|
|
(181)
|
|
(729)
|
|
(449)
|
Net income
(loss)
|
$
|
(48)
|
$
|
(34)
|
$
|
(64)
|
$
|
(255)
|
$
|
(147)
|
Net income (loss)
attributable to non-controlling interests in
subsidiaries
|
|
-
|
|
(1)
|
|
-
|
|
1
|
|
-
|
Net income (loss)
attributable to equity holders of the Bank
|
$
|
(48)
|
$
|
(33)
|
$
|
(64)
|
$
|
(256)
|
$
|
(147)
|
(1) Refer to
Non-GAAP Measures for the reconciliation of reported and adjusted
results.
|
The Other segment includes Group Treasury, smaller operating
segments, Net loss on divestitures and other corporate items which
are not allocated to a business line.
Net interest income, other operating income, and the provision
for income taxes in each period include the elimination of
tax-exempt income gross-up. This amount is included in the
operating segments, which are reported on a taxable equivalent
basis. The elimination was $58
million in the fourth quarter, compared to $31 million in the same period last year and
$48 million last quarter. Net income
from investments in associated corporations and the provision for
income taxes in each period include the tax normalization
adjustments related to the gross-up of income from associated
companies. This adjustment normalizes the effective tax rate in the
divisions to better present the contribution of the associated
companies to the divisional results.
Q4 2019 vs Q4 2018
Net loss attributable to equity holders was $80 million. Adjusting for the Net loss on
divestitures of $32 million, net loss
attributable to equity holders was $48
million, compared to $64
million. The lower net loss was due mainly to higher
investment gains, partly offset by lower contributions from
asset/liability management activities and higher non-interest
expenses.
Q4 2019 vs Q3 2019
Net loss attributable to equity holders was $80 million. Adjusting for the Net loss on
divestitures in both periods, the net loss attributable to equity
holders was $48 million, compared to
$33 million. The higher net loss was
due primarily to lower contributions from asset/liability
management activities.
Consolidated Statement of Financial Position
|
As at
|
|
|
October
31
|
|
July 31
|
|
October 31
|
(unaudited) ($
millions)
|
|
2019
|
|
2019
|
|
2018
|
Assets
|
|
|
|
|
|
|
Cash and deposits
with financial institutions
|
$
|
46,720
|
$
|
45,262
|
$
|
62,269
|
Precious
metals
|
|
3,709
|
|
3,572
|
|
3,191
|
Trading
assets
|
|
|
|
|
|
|
Securities
|
|
112,664
|
|
115,988
|
|
85,474
|
Loans
|
|
13,829
|
|
14,158
|
|
14,334
|
Other
|
|
995
|
|
922
|
|
454
|
|
|
127,488
|
|
131,068
|
|
100,262
|
Financial instruments
designated at fair value through profit or loss
|
|
-
|
|
13
|
|
12
|
Securities purchased
under resale agreements and securities borrowed
|
|
131,178
|
|
119,478
|
|
104,018
|
Derivative financial
instruments
|
|
38,119
|
|
36,157
|
|
37,558
|
Investment
securities
|
|
82,359
|
|
82,592
|
|
78,396
|
Loans
|
|
|
|
|
|
|
Residential
mortgages
|
|
268,169
|
|
265,170
|
|
253,357
|
Personal
loans
|
|
98,631
|
|
98,679
|
|
96,019
|
Credit
cards
|
|
17,788
|
|
17,933
|
|
16,485
|
Business and
government
|
|
212,972
|
|
212,655
|
|
191,038
|
|
|
597,560
|
|
594,437
|
|
556,899
|
Allowance for credit
losses
|
|
5,077
|
|
5,194
|
|
5,065
|
|
|
592,483
|
|
589,243
|
|
551,834
|
Other
|
|
|
|
|
|
|
Customers' liability
under acceptances, net of allowance
|
|
13,896
|
|
13,923
|
|
16,329
|
Property and
equipment
|
|
2,669
|
|
2,634
|
|
2,684
|
Investments in
associates
|
|
5,614
|
|
5,496
|
|
4,850
|
Goodwill and other
intangible assets
|
|
17,465
|
|
17,612
|
|
17,719
|
Deferred tax
assets
|
|
1,570
|
|
1,706
|
|
1,938
|
Other
assets
|
|
22,891
|
|
17,984
|
|
17,433
|
|
|
64,105
|
|
59,355
|
|
60,953
|
Total
assets
|
$
|
1,086,161
|
$
|
1,066,740
|
$
|
998,493
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
Deposits
|
|
|
|
|
|
|
Personal
|
$
|
224,800
|
$
|
222,895
|
$
|
214,545
|
Business and
government
|
|
461,851
|
|
456,806
|
|
422,002
|
Financial
institutions
|
|
46,739
|
|
42,645
|
|
39,987
|
|
|
733,390
|
|
722,346
|
|
676,534
|
Financial instruments
designated at fair value through profit or loss
|
|
12,235
|
|
11,536
|
|
8,188
|
Other
|
|
|
|
|
|
|
Acceptances
|
|
13,901
|
|
13,932
|
|
16,338
|
Obligations related
to securities sold short
|
|
30,404
|
|
25,669
|
|
32,087
|
Derivative financial
instruments
|
|
40,222
|
|
37,307
|
|
37,967
|
Obligations related to securities sold under repurchase agreements and securities
lent
|
|
124,083
|
|
120,555
|
|
101,257
|
Subordinated
debentures
|
|
7,252
|
|
9,021
|
|
5,698
|
Other
liabilities
|
|
54,482
|
|
56,243
|
|
52,744
|
|
|
270,344
|
|
262,727
|
|
246,091
|
Total
liabilities
|
|
1,015,969
|
|
996,609
|
|
930,813
|
|
|
|
|
|
|
|
Equity
|
|
|
|
|
|
|
Common
equity
|
|
|
|
|
|
|
Common
shares
|
|
18,264
|
|
18,295
|
|
18,234
|
Retained
earnings
|
|
44,439
|
|
43,682
|
|
41,414
|
Accumulated other
comprehensive income (loss)
|
|
570
|
|
1,187
|
|
992
|
Other
reserves
|
|
365
|
|
370
|
|
404
|
Total common
equity
|
|
63,638
|
|
63,534
|
|
61,044
|
Preferred shares and
other equity instruments
|
|
3,884
|
|
3,884
|
|
4,184
|
Total equity
attributable to equity holders of the Bank
|
|
67,522
|
|
67,418
|
|
65,228
|
Non-controlling
interests in subsidiaries
|
|
2,670
|
|
2,713
|
|
2,452
|
Total
equity
|
|
70,192
|
|
70,131
|
|
67,680
|
Total liabilities and
equity
|
$
|
1,086,161
|
$
|
1,066,740
|
$
|
998,493
|
Consolidated Statement of Income
|
For the three months
ended
|
For the year
ended
|
|
|
October
31
|
|
|
July 31
|
|
|
October 31
|
|
|
October
31
|
|
|
October 31
|
(unaudited) ($
millions)
|
|
2019
|
(1)
|
|
2019
|
(1)
|
|
2018
|
|
|
2019
|
(1)
|
|
2018
|
Revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income(2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans
|
$
|
7,371
|
|
$
|
7,490
|
|
$
|
6,877
|
|
$
|
29,116
|
|
$
|
24,991
|
Securities
|
|
562
|
|
|
593
|
|
|
488
|
|
|
2,238
|
|
|
1,771
|
Securities purchased under resale agreements and securities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
borrowed
|
|
106
|
|
|
126
|
|
|
129
|
|
|
502
|
|
|
446
|
Deposits with
financial institutions
|
|
213
|
|
|
231
|
|
|
226
|
|
|
928
|
|
|
859
|
|
|
8,252
|
|
|
8,440
|
|
|
7,720
|
|
|
32,784
|
|
|
28,067
|
Interest
expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposits
|
|
3,477
|
|
|
3,574
|
|
|
3,063
|
|
|
13,871
|
|
|
10,544
|
Subordinated
debentures
|
|
83
|
|
|
77
|
|
|
55
|
|
|
294
|
|
|
214
|
Other
|
|
356
|
|
|
415
|
|
|
382
|
|
|
1,442
|
|
|
1,118
|
|
|
3,916
|
|
|
4,066
|
|
|
3,500
|
|
|
15,607
|
|
|
11,876
|
Net interest
income
|
|
4,336
|
|
|
4,374
|
|
|
4,220
|
|
|
17,177
|
|
|
16,191
|
Non-interest
income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Card
revenues
|
|
245
|
|
|
240
|
|
|
300
|
|
|
977
|
|
|
1,105
|
Banking services
fees
|
|
473
|
|
|
445
|
|
|
473
|
|
|
1,812
|
|
|
1,705
|
Credit
fees
|
|
345
|
|
|
325
|
|
|
308
|
|
|
1,316
|
|
|
1,191
|
Mutual
funds
|
|
476
|
|
|
472
|
|
|
439
|
|
|
1,849
|
|
|
1,714
|
Brokerage
fees
|
|
226
|
|
|
217
|
|
|
227
|
|
|
876
|
|
|
895
|
Investment management
and trust
|
|
263
|
|
|
259
|
|
|
209
|
|
|
1,050
|
|
|
732
|
Underwriting and
other advisory
|
|
146
|
|
|
110
|
|
|
103
|
|
|
497
|
|
|
514
|
Non-trading foreign
exchange
|
|
161
|
|
|
171
|
|
|
158
|
|
|
667
|
|
|
622
|
Trading
revenues
|
|
376
|
|
|
397
|
|
|
370
|
|
|
1,488
|
|
|
1,420
|
Net gain on sale of
investment securities
|
|
125
|
|
|
118
|
|
|
10
|
|
|
351
|
|
|
146
|
Net income from
investments in associated corporations
|
|
161
|
|
|
190
|
|
|
169
|
|
|
650
|
|
|
559
|
Insurance
underwriting income, net of claims
|
|
158
|
|
|
165
|
|
|
169
|
|
|
676
|
|
|
686
|
Other fees and
commissions
|
|
221
|
|
|
231
|
|
|
228
|
|
|
949
|
|
|
841
|
Other(3)
|
|
256
|
|
|
(55)
|
|
|
65
|
|
|
699
|
|
|
454
|
|
|
3,632
|
|
|
3,285
|
|
|
3,228
|
|
|
13,857
|
|
|
12,584
|
Total
revenue
|
|
7,968
|
|
|
7,659
|
|
|
7,448
|
|
|
31,034
|
|
|
28,775
|
Provision for credit
losses
|
|
753
|
|
|
713
|
|
|
590
|
|
|
3,027
|
|
|
2,611
|
|
|
7,215
|
|
|
6,946
|
|
|
6,858
|
|
|
28,007
|
|
|
26,164
|
Non-interest
expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and employee
benefits
|
|
2,115
|
|
|
2,138
|
|
|
1,972
|
|
|
8,443
|
|
|
7,455
|
Premises and
technology
|
|
712
|
|
|
697
|
|
|
695
|
|
|
2,807
|
|
|
2,577
|
Depreciation and
amortization
|
|
271
|
|
|
276
|
|
|
233
|
|
|
1,053
|
|
|
848
|
Communications
|
|
118
|
|
|
113
|
|
|
123
|
|
|
459
|
|
|
447
|
Advertising and
business development
|
|
174
|
|
|
162
|
|
|
182
|
|
|
625
|
|
|
581
|
Professional
|
|
243
|
|
|
197
|
|
|
270
|
|
|
861
|
|
|
881
|
Business and capital
taxes
|
|
126
|
|
|
130
|
|
|
113
|
|
|
515
|
|
|
464
|
Other
|
|
552
|
|
|
496
|
|
|
476
|
|
|
1,974
|
|
|
1,805
|
|
|
4,311
|
|
|
4,209
|
|
|
4,064
|
|
|
16,737
|
|
|
15,058
|
Income before
taxes
|
|
2,904
|
|
|
2,737
|
|
|
2,794
|
|
|
11,270
|
|
|
11,106
|
Income tax
expense
|
|
596
|
|
|
753
|
|
|
523
|
|
|
2,472
|
|
|
2,382
|
Net
income
|
$
|
2,308
|
|
$
|
1,984
|
|
$
|
2,271
|
|
$
|
8,798
|
|
$
|
8,724
|
Net income
attributable to non-controlling interests in
subsidiaries
|
|
107
|
|
|
120
|
|
|
92
|
|
|
408
|
|
|
176
|
Net income
attributable to equity holders of the Bank
|
$
|
2,201
|
|
$
|
1,864
|
|
$
|
2,179
|
|
$
|
8,390
|
|
$
|
8,548
|
Preferred
shareholders and other equity instrument holders
|
|
64
|
|
|
25
|
|
|
65
|
|
|
182
|
|
|
187
|
Common
shareholders
|
$
|
2,137
|
|
$
|
1,839
|
|
$
|
2,114
|
|
$
|
8,208
|
|
$
|
8,361
|
Earnings per
common share (in dollars)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
$
|
1.76
|
|
$
|
1.51
|
|
$
|
1.72
|
|
$
|
6.72
|
|
$
|
6.90
|
Diluted
|
|
1.73
|
|
|
1.50
|
|
|
1.71
|
|
|
6.68
|
|
|
6.82
|
Dividends paid per
common share (in dollars)
|
|
0.90
|
|
|
0.87
|
|
|
0.85
|
|
|
3.49
|
|
|
3.28
|
(1) The amounts
for the periods ended October 31, 2019 and July 31, 2019 have been
prepared in accordance with IFRS 15; prior period amounts have not
been restated (refer to Notes 3 and 4 in the consolidated financial
statements in the 2019 Annual Report).
|
|
|
(2) Interest
income on financial assets measured at amortized cost and FVOCI is
calculated using the effective interest method. Includes interest
income of $8,146 for the three months ended October 31, 2019 (July
31, 2019 - $8,348; October 31, 2018 - $7,652) and $32,436 for the
year ended October 31, 2019 (October 31, 2018 -
$27,854).
|
|
|
(3) For the
periods ended October 31, 2019 and July 31, 2019, includes Net
gain/(loss) on divestitures. Refer to Note 37 in the Consolidated
Financial statements in the 2019 Annual report.
|
|
|
Consolidated Statement of Comprehensive Income
|
For the three months
ended
|
For the year
ended
|
|
|
October
31
|
|
July 31
|
|
October 31
|
|
October
31
|
|
October 31
|
(unaudited) ($
millions)
|
|
2019
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Net
income
|
$
|
2,308
|
$
|
1,984
|
$
|
2,271
|
$
|
8,798
|
$
|
8,724
|
Other
comprehensive income (loss)
|
|
|
|
|
|
|
|
|
|
|
Items that will be
reclassified subsequently to net income
|
|
|
|
|
|
|
|
|
|
|
Net change in
unrealized foreign currency translation gains (losses):
|
|
|
|
|
|
|
|
|
|
|
Net unrealized
foreign currency translation gains (losses)
|
|
(966)
|
|
(1,093)
|
|
(752)
|
|
(626)
|
|
(406)
|
Net gains (losses) on
hedges of net investments in foreign operations
|
|
82
|
|
220
|
|
(54)
|
|
(232)
|
|
(281)
|
Income tax expense
(benefit):
|
|
|
|
|
|
|
|
|
|
|
Net unrealized
foreign currency translation gains (losses)
|
|
19
|
|
(10)
|
|
(3)
|
|
21
|
|
(7)
|
Net gains (losses) on
hedges of net investments in foreign operations
|
|
22
|
|
58
|
|
(14)
|
|
(60)
|
|
(74)
|
|
|
(925)
|
|
(921)
|
|
(789)
|
|
(819)
|
|
(606)
|
Net change in fair
value due to change in debt instruments measured at fair
|
|
|
|
|
|
|
|
|
|
|
value through other
comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
Net gains (losses) in
fair value
|
|
163
|
|
412
|
|
(156)
|
|
1,265
|
|
(605)
|
Reclassification of
net (gains) losses to net income
|
|
(217)
|
|
(366)
|
|
97
|
|
(1,150)
|
|
281
|
Income tax expense
(benefit):
|
|
|
|
|
|
|
|
|
|
|
Net gains (losses) in
fair value
|
|
28
|
|
104
|
|
(38)
|
|
308
|
|
(145)
|
Reclassification of
net (gains) losses to net income
|
|
(50)
|
|
(99)
|
|
27
|
|
(298)
|
|
73
|
|
|
(32)
|
|
41
|
|
(48)
|
|
105
|
|
(252)
|
Net change in gains (losses) on derivative instruments designated as
cash
|
|
|
|
|
|
|
|
|
|
|
flow
hedges:
|
|
|
|
|
|
|
|
|
|
|
Net gains (losses) on
derivative instruments designated as cash flow hedges
|
|
618
|
|
(842)
|
|
(858)
|
|
361
|
|
(1,181)
|
Reclassification of
net (gains) losses to net income
|
|
(481)
|
|
1,324
|
|
721
|
|
596
|
|
695
|
Income tax expense
(benefit):
|
|
|
|
|
|
|
|
|
|
|
Net gains (losses) on
derivative instruments designated as cash flow
|
|
|
|
|
|
|
|
|
|
|
hedges
|
|
155
|
|
(223)
|
|
(223)
|
|
86
|
|
(307)
|
Reclassification of
net (gains) losses to net income
|
|
(119)
|
|
349
|
|
189
|
|
163
|
|
182
|
|
|
101
|
|
356
|
|
(103)
|
|
708
|
|
(361)
|
Other comprehensive
income (loss) from investments in associates
|
|
21
|
|
25
|
|
26
|
|
103
|
|
66
|
Items that will
not be reclassified subsequently to net income
|
|
|
|
|
|
|
|
|
|
|
Net change in
remeasurement of employee benefit plan asset and
liability:
|
|
|
|
|
|
|
|
|
|
|
Actuarial gains
(losses) on employee benefit plans
|
|
75
|
|
(475)
|
|
129
|
|
(1,096)
|
|
444
|
Income tax expense
(benefit)
|
|
22
|
|
(130)
|
|
38
|
|
(281)
|
|
126
|
|
|
53
|
|
(345)
|
|
91
|
|
(815)
|
|
318
|
Net change in fair
value due to change in equity instruments designated at
|
|
|
|
|
|
|
|
|
|
|
fair value through
other comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
Net gains (losses) in
fair value
|
|
36
|
|
35
|
|
(24)
|
|
121
|
|
75
|
Income tax expense
(benefit)
|
|
6
|
|
8
|
|
(6)
|
|
26
|
|
15
|
|
|
30
|
|
27
|
|
(18)
|
|
95
|
|
60
|
Net change in fair
value due to change in own credit risk on financial
|
|
|
|
|
|
|
|
|
|
|
liabilities
designated under the fair value option:
|
|
|
|
|
|
|
|
|
|
|
Change in fair value
due to change in own credit risk on financial
liabilities
|
|
|
|
|
|
|
|
|
|
|
designated under the
fair value option
|
|
18
|
|
6
|
|
(46)
|
|
11
|
|
(30)
|
Income tax expense
(benefit)
|
|
5
|
|
2
|
|
(13)
|
|
3
|
|
(8)
|
|
|
13
|
|
4
|
|
(33)
|
|
8
|
|
(22)
|
Other comprehensive
income (loss) from investments in associates
|
|
(7)
|
|
-
|
|
-
|
|
(10)
|
|
(7)
|
Other comprehensive
income (loss)
|
|
(746)
|
|
(813)
|
|
(874)
|
|
(625)
|
|
(804)
|
Comprehensive
income (loss)
|
$
|
1,562
|
$
|
1,171
|
$
|
1,397
|
$
|
8,173
|
$
|
7,920
|
Comprehensive income
(loss) attributable to non-controlling interests
|
|
(22)
|
|
(44)
|
|
(71)
|
|
205
|
|
65
|
Comprehensive income
(loss) attributable to equity holders of the Bank
|
$
|
1,584
|
$
|
1,215
|
$
|
1,468
|
$
|
7,968
|
$
|
7,855
|
Preferred
shareholders and other equity instrument holders
|
|
64
|
|
25
|
|
65
|
|
182
|
|
187
|
Common
shareholders
|
$
|
1,520
|
$
|
1,190
|
$
|
1,403
|
$
|
7,786
|
$
|
7,668
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Statement of Changes in Equity
|
|
|
|
|
|
|
Accumulated other
comprehensive income (loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred
|
|
Total
|
|
Non-
|
|
|
|
|
|
|
|
|
|
|
Foreign
|
|
Available-
|
|
Debt
|
|
Equity
|
|
Cash
|
|
|
|
|
|
|
|
Total
|
|
shares
and
|
|
attributable
|
|
controlling
|
|
|
|
|
|
Common
|
|
Retained
|
|
|
currency
|
|
for-sale
|
|
instruments
|
|
instruments
|
|
flow
|
|
|
|
|
Other
|
|
|
common
|
|
other
equity
|
|
to equity
|
|
interests
in
|
|
|
|
(unaudited) ($
millions)
|
|
shares
|
|
earnings
|
(1)
|
|
translation
|
|
securities
|
|
FVOCI
|
|
FVOCI
|
|
hedges
|
|
Other
|
(2)
|
|
reserves
|
|
|
equity
|
|
instruments
|
|
holders
|
|
subsidiaries
|
|
|
Total
|
Balance as at
October 31, 2018
|
$
|
18,234
|
$
|
41,414
|
|
$
|
1,441
|
$
|
-
|
$
|
(68)
|
$
|
(126)
|
$
|
(121)
|
$
|
(134)
|
|
$
|
404
|
|
$
|
61,044
|
$
|
4,184
|
$
|
65,228
|
$
|
2,452
|
|
$
|
67,680
|
Cumulative effect of
adopting IFRS 15(3)
|
|
-
|
|
(58)
|
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
-
|
|
|
(58)
|
|
-
|
|
(58)
|
|
-
|
|
|
(58)
|
Balance as at
November 1, 2018
|
$
|
18,234
|
$
|
41,356
|
|
$
|
1,441
|
$
|
-
|
$
|
(68)
|
$
|
(126)
|
$
|
(121)
|
$
|
(134)
|
|
$
|
404
|
|
$
|
60,986
|
$
|
4,184
|
$
|
65,170
|
$
|
2,452
|
|
$
|
67,622
|
Net income
|
|
-
|
|
8,208
|
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
-
|
|
|
8,208
|
|
182
|
|
8,390
|
|
408
|
|
|
8,798
|
Other comprehensive
income (loss)
|
|
-
|
|
-
|
|
|
(641)
|
|
-
|
|
105
|
|
71
|
|
771
|
|
(728)
|
|
|
-
|
|
|
(422)
|
|
-
|
|
(422)
|
|
(203)
|
|
|
(625)
|
Total
comprehensive income
|
$
|
-
|
$
|
8,208
|
|
$
|
(641)
|
$
|
-
|
$
|
105
|
$
|
71
|
$
|
771
|
$
|
(728)
|
|
$
|
-
|
|
$
|
7,786
|
$
|
182
|
$
|
7,968
|
$
|
205
|
|
$
|
8,173
|
Shares
issued
|
|
255
|
|
-
|
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
(37)
|
|
|
218
|
|
-
|
|
218
|
|
-
|
|
|
218
|
Shares
repurchased/redeemed
|
|
(225)
|
|
(850)
|
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
-
|
|
|
(1,075)
|
|
(300)
|
|
(1,375)
|
|
-
|
|
|
(1,375)
|
Dividends and
distributions paid to
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
equity
holders
|
|
-
|
|
(4,260)
|
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
-
|
|
|
(4,260)
|
|
(182)
|
|
(4,442)
|
|
(150)
|
|
|
(4,592)
|
Share-based
payments(4)
|
|
-
|
|
-
|
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
7
|
|
|
7
|
|
-
|
|
7
|
|
-
|
|
|
7
|
Other
|
|
-
|
|
(15)
|
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
(9)
|
|
|
(24)
|
|
-
|
|
(24)
|
|
163
|
(5)
|
|
139
|
Balance as at
October 31, 2019
|
$
|
18,264
|
$
|
44,439
|
|
$
|
800
|
$
|
-
|
$
|
37
|
$
|
(55)
|
$
|
650
|
$
|
(862)
|
|
$
|
365
|
|
$
|
63,638
|
$
|
3,884
|
$
|
67,522
|
$
|
2,670
|
|
$
|
70,192
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as at
October 31, 2017
|
$
|
15,644
|
$
|
38,117
|
|
$
|
1,861
|
$
|
(46)
|
$
|
-
|
$
|
-
|
$
|
235
|
$
|
(473)
|
|
$
|
116
|
|
$
|
55,454
|
$
|
4,579
|
$
|
60,033
|
$
|
1,592
|
|
$
|
61,625
|
Cumulative effect of
adopting IFRS 9
|
|
-
|
|
(564)
|
|
|
-
|
|
46
|
|
184
|
|
(179)
|
|
-
|
|
-
|
|
|
-
|
|
|
(513)
|
|
-
|
|
(513)
|
|
(97)
|
|
|
(610)
|
Balance as at
November 1, 2017
|
$
|
15,644
|
$
|
37,553
|
|
$
|
1,861
|
$
|
-
|
$
|
184
|
$
|
(179)
|
$
|
235
|
$
|
(473)
|
|
$
|
116
|
|
$
|
54,941
|
$
|
4,579
|
$
|
59,520
|
$
|
1,495
|
|
$
|
61,015
|
Net income
|
|
-
|
|
8,361
|
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
-
|
|
|
8,361
|
|
187
|
|
8,548
|
|
176
|
|
|
8,724
|
Other comprehensive
income (loss)
|
|
-
|
|
-
|
|
|
(477)
|
|
-
|
|
(252)
|
|
53
|
|
(356)
|
|
339
|
|
|
-
|
|
|
(693)
|
|
-
|
|
(693)
|
|
(111)
|
|
|
(804)
|
Total
comprehensive income
|
$
|
-
|
$
|
8,361
|
|
$
|
(477)
|
$
|
-
|
$
|
(252)
|
$
|
53
|
$
|
(356)
|
$
|
339
|
|
$
|
-
|
|
$
|
7,668
|
$
|
187
|
$
|
7,855
|
$
|
65
|
|
$
|
7,920
|
Shares
issued
|
|
2,708
|
|
-
|
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
(19)
|
|
|
2,689
|
|
300
|
|
2,989
|
|
-
|
|
|
2,989
|
Shares
repurchased/redeemed
|
|
(118)
|
|
(514)
|
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
-
|
|
|
(632)
|
|
(695)
|
|
(1,327)
|
|
-
|
|
|
(1,327)
|
Dividends and
distributions paid to
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
equity
holders
|
|
-
|
|
(3,985)
|
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
-
|
|
|
(3,985)
|
|
(187)
|
|
(4,172)
|
|
(199)
|
|
|
(4,371)
|
Share-based
payments(4)
|
|
-
|
|
-
|
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
6
|
|
|
6
|
|
-
|
|
6
|
|
-
|
|
|
6
|
Other
|
|
-
|
|
(1)
|
|
|
57
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
301
|
(5)
|
|
357
|
|
-
|
|
357
|
|
1,091
|
(5)
|
|
1,448
|
Balance as at
October 31, 2018
|
$
|
18,234
|
$
|
41,414
|
|
$
|
1,441
|
$
|
-
|
$
|
(68)
|
$
|
(126)
|
$
|
(121)
|
$
|
(134)
|
|
$
|
404
|
|
$
|
61,044
|
$
|
4,184
|
$
|
65,228
|
$
|
2,452
|
|
$
|
67,680
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as at
November 1, 2016
|
$
|
15,513
|
$
|
34,752
|
|
$
|
3,055
|
$
|
14
|
$
|
-
|
$
|
-
|
$
|
264
|
$
|
(1,093)
|
|
$
|
152
|
|
$
|
52,657
|
$
|
3,594
|
$
|
56,251
|
$
|
1,570
|
|
$
|
57,821
|
Net income
|
|
-
|
|
7,876
|
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
-
|
|
|
7,876
|
|
129
|
|
8,005
|
|
238
|
|
|
8,243
|
Other comprehensive
income (loss)
|
|
-
|
|
-
|
|
|
(1,194)
|
|
(60)
|
|
-
|
|
-
|
|
(29)
|
|
620
|
|
|
-
|
|
|
(663)
|
|
-
|
|
(663)
|
|
(46)
|
|
|
(709)
|
Total
comprehensive income
|
$
|
-
|
$
|
7,876
|
|
$
|
(1,194)
|
$
|
(60)
|
$
|
-
|
$
|
-
|
$
|
(29)
|
$
|
620
|
|
$
|
-
|
|
$
|
7,213
|
$
|
129
|
$
|
7,342
|
$
|
192
|
|
$
|
7,534
|
Shares and other
equity instruments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
issued
|
|
313
|
|
-
|
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
(44)
|
|
|
269
|
|
1,560
|
|
1,829
|
|
-
|
|
|
1,829
|
Shares
repurchased/redeemed
|
|
(182)
|
|
(827)
|
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
-
|
|
|
(1,009)
|
|
(575)
|
|
(1,584)
|
|
-
|
|
|
(1,584)
|
Dividends and
distributions paid to
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
equity
holders
|
|
-
|
|
(3,668)
|
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
-
|
|
|
(3,668)
|
|
(129)
|
|
(3,797)
|
|
(133)
|
|
|
(3,930)
|
Share-based
payments(4)
|
|
-
|
|
-
|
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
8
|
|
|
8
|
|
-
|
|
8
|
|
-
|
|
|
8
|
Other
|
|
-
|
|
(16)
|
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
-
|
|
|
(16)
|
|
-
|
|
(16)
|
|
(37)
|
(5)
|
|
(53)
|
Balance as at
October 31, 2017
|
$
|
15,644
|
$
|
38,117
|
|
$
|
1,861
|
$
|
(46)
|
$
|
-
|
$
|
-
|
$
|
235
|
$
|
(473)
|
|
$
|
116
|
|
$
|
55,454
|
$
|
4,579
|
$
|
60,033
|
$
|
1,592
|
|
$
|
61,625
|
(1) Includes
undistributed retained earnings of $61 (2018 - $62;
2017 – $61) related to a foreign associated corporation,
which is subject to local regulatory restriction.
|
|
|
(2) Includes Share
from associates, Employee benefits and Own credit
risk.
|
|
|
(3) Refer to Note
4 in the consolidated financial statements in the 2019 Annual
Report for a summary of the adjustments on initial application of
IFRS 15.
|
|
|
(4) Represents
amounts on account of share-based payments (Refer to Note 26 in the
consolidated financial statements in the 2019 Annual
Report).
|
|
|
(5) Includes
changes to non-controlling interests arising from business
combinations and related transactions.
|
|
|
Consolidated Statement of Cash Flows
(unaudited) ($
millions)
|
For the three months
ended
|
For the year
ended
|
|
|
October
31
|
|
October 31
|
|
October
31
|
|
October 31
|
Sources (uses) of
cash flows
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Cash flows from
operating activities
|
|
|
|
|
|
|
|
|
Net income
|
$
|
2,308
|
$
|
2,271
|
$
|
8,798
|
$
|
8,724
|
Adjustment
for:
|
|
|
|
|
|
|
|
|
Net interest
income
|
|
(4,336)
|
|
(4,220)
|
|
(17,177)
|
|
(16,191)
|
Depreciation and
amortization
|
|
271
|
|
233
|
|
1,053
|
|
848
|
Provision for credit
losses
|
|
753
|
|
590
|
|
3,027
|
|
2,611
|
Equity-settled
share-based payment expense
|
|
1
|
|
-
|
|
7
|
|
6
|
Net gain on sale of
investment securities
|
|
(125)
|
|
(10)
|
|
(351)
|
|
(146)
|
Net gain on
divestitures
|
|
(4)
|
|
-
|
|
125
|
|
-
|
Net income from
investments in associated corporations
|
|
(161)
|
|
(169)
|
|
(650)
|
|
(559)
|
Income tax
expense
|
|
596
|
|
523
|
|
2,472
|
|
2,382
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
|
|
|
Trading
assets
|
|
4,106
|
|
(7,399)
|
|
(27,514)
|
|
111
|
Securities purchased
under resale agreements and securities borrowed
|
|
(11,272)
|
|
(19,028)
|
|
(27,235)
|
|
(7,721)
|
Loans
|
|
(7,931)
|
|
(8,162)
|
|
(44,337)
|
|
(31,848)
|
Deposits
|
|
15,028
|
|
25,477
|
|
60,705
|
|
40,338
|
Obligations related
to securities sold short
|
|
4,383
|
|
4,215
|
|
(1,694)
|
|
239
|
Obligations related
to securities sold under repurchase agreements and securities
lent
|
|
3,232
|
|
19,238
|
|
22,727
|
|
4,387
|
Net derivative
financial instruments
|
|
1,502
|
|
(339)
|
|
1,964
|
|
440
|
Other, net
|
|
(8,251)
|
|
995
|
|
(8,881)
|
|
(188)
|
Dividends
received
|
|
165
|
|
90
|
|
520
|
|
332
|
Interest
received
|
|
8,287
|
|
7,359
|
|
32,696
|
|
27,384
|
Interest
paid
|
|
(3,802)
|
|
(3,200)
|
|
(15,322)
|
|
(11,400)
|
Income tax
paid
|
|
(685)
|
|
(159)
|
|
(2,958)
|
|
(1,938)
|
Net cash from/(used
in) operating activities
|
|
4,065
|
|
18,305
|
|
(12,025)
|
|
17,811
|
Cash flows from
investing activities
|
|
|
|
|
|
|
|
|
Interest-bearing
deposits with financial institutions
|
|
(1,149)
|
|
(9,202)
|
|
18,014
|
|
(704)
|
Purchase of
investment securities
|
|
(21,482)
|
|
(25,370)
|
|
(89,018)
|
|
(91,896)
|
Proceeds from sale
and maturity of investment securities
|
|
21,846
|
|
21,105
|
|
86,956
|
|
84,336
|
Acquisition/sale of
subsidiaries, associated corporations or business units,
|
|
|
|
|
|
|
|
|
net of cash
acquired
|
|
56
|
|
(1,457)
|
|
20
|
|
(3,862)
|
Property and
equipment, net of disposals
|
|
(148)
|
|
(195)
|
|
(186)
|
|
(416)
|
Other, net
|
|
(137)
|
|
(678)
|
|
(568)
|
|
(1,183)
|
Net cash from/(used
in) investing activities
|
|
(1,014)
|
|
(15,797)
|
|
15,218
|
|
(13,725)
|
Cash flows from
financing activities
|
|
|
|
|
|
|
|
|
Proceeds from issue
of subordinated debentures
|
|
-
|
|
-
|
|
3,250
|
|
-
|
Redemption/repayment
of subordinated debentures
|
|
(1,753)
|
|
-
|
|
(1,771)
|
|
(233)
|
Proceeds from
preferred shares and other equity instruments issued
|
|
-
|
|
300
|
|
-
|
|
300
|
Redemption of
preferred shares
|
|
-
|
|
(350)
|
|
(300)
|
|
(695)
|
Proceeds from common
shares issued
|
|
44
|
|
16
|
|
255
|
|
1,830
|
Common shares
purchased for cancellation
|
|
(356)
|
|
(380)
|
|
(1,075)
|
|
(632)
|
Cash dividends and
distributions paid
|
|
(1,158)
|
|
(1,108)
|
|
(4,442)
|
|
(4,172)
|
Distributions to
non-controlling interests
|
|
(19)
|
|
(119)
|
|
(150)
|
|
(199)
|
Other, net
|
|
609
|
|
239
|
|
2,945
|
|
931
|
Net cash from/(used
in) financing activities
|
|
(2,633)
|
|
(1,402)
|
|
(1,288)
|
|
(2,870)
|
Effect of exchange
rate changes on cash and cash equivalents
|
|
(62)
|
|
(107)
|
|
2
|
|
(44)
|
Net change in cash
and cash equivalents
|
|
356
|
|
999
|
|
1,907
|
|
1,172
|
Cash and cash
equivalents at beginning of period(1)
|
|
10,548
|
|
7,998
|
|
8,997
|
|
7,825
|
Cash and cash
equivalents at end of period(1)
|
$
|
10,904
|
$
|
8,997
|
$
|
10,904
|
$
|
8,997
|
(1) Represents
cash and non-interest bearing deposits with financial institutions
(refer to Note 6 in the consolidated financial statements in the
2019 Annual Report).
|
Basis of preparation
These unaudited consolidated financial statements were prepared
in accordance with IFRS as issued by International Accounting
Standards Board (IASB) and accounting requirements of OSFI in
accordance with Section 308 of the Bank Act, except for certain
required disclosures. Therefore, these unaudited consolidated
financial statements should be read in conjunction with the Bank's
audited consolidated financial statements for the year ended
October 31, 2019 which will be
available today at www.Scotiabank.com.
Forward-Looking Statements
From time to time, our public communications often include oral
or written forward-looking statements. Statements of this type are
included in this document, and may be included in other filings
with Canadian securities regulators or the U.S. Securities and
Exchange Commission ("SEC"), or in other communications. In
addition, representatives of the Bank may include forward-looking
statements orally to analysts, investors, the media and others. All
such statements are made pursuant to the "safe harbor" provisions
of the U.S. Private Securities Litigation Reform Act of 1995 and
any applicable Canadian securities legislation. Forward-looking
statements may include, but are not limited to, statements made in
this document, the Management's Discussion and Analysis in the
Bank's 2019 Annual Report under the headings "Outlook" and in other
statements regarding the Bank's objectives, strategies to achieve
those objectives, the regulatory environment in which the Bank
operates, anticipated financial results, and the outlook for the
Bank's businesses and for the Canadian, U.S. and global economies.
Such statements are typically identified by words or phrases such
as "believe," "expect," "foresee," "forecast," "anticipate,"
"intend," "estimate," "plan," "goal," "project," and similar
expressions of future or conditional verbs, such as "will," "may,"
"should," "would" and "could."
By their very nature, forward-looking statements require us to
make assumptions and are subject to inherent risks and
uncertainties, which give rise to the possibility that our
predictions, forecasts, projections, expectations or conclusions
will not prove to be accurate, that our assumptions may not be
correct and that our financial performance objectives, vision and
strategic goals will not be achieved.
We caution readers not to place undue reliance on these
statements as a number of risk factors, many of which are beyond
our control and effects of which can be difficult to predict, could
cause our actual results to differ materially from the
expectations, targets, estimates or intentions expressed in such
forward-looking statements.
The future outcomes that relate to forward-looking statements
may be influenced by many factors, including but not limited to:
general economic and market conditions in the countries in which we
operate; changes in currency and interest rates; increased funding
costs and market volatility due to market illiquidity and
competition for funding; the failure of third parties to comply
with their obligations to the Bank and its affiliates; changes in
monetary, fiscal, or economic policy and tax legislation and
interpretation; changes in laws and regulations or in
supervisory expectations or requirements, including capital,
interest rate and liquidity requirements and guidance, and the
effect of such changes on funding costs; changes to our credit
ratings; operational and infrastructure risks; reputational risks;
the accuracy and completeness of information the Bank receives on
customers and counterparties; the timely development and
introduction of new products and services; our ability to execute
our strategic plans, including the successful completion of
acquisitions and dispositions, including obtaining regulatory
approvals; critical accounting estimates and the effect of changes
to accounting standards, rules and interpretations on these
estimates; global capital markets activity; the Bank's ability to
attract, develop and retain key executives; the evolution of
various types of fraud or other criminal behaviour to which the
Bank is exposed; disruptions in or attacks (including
cyber-attacks) on the Bank's information technology, internet,
network access, or other voice or data communications systems or
services; increased competition in the geographic and in business
areas in which we operate, including through internet and mobile
banking and non-traditional competitors; exposure related to
significant litigation and regulatory matters; the occurrence of
natural and unnatural catastrophic events and claims resulting from
such events; and the Bank's anticipation of and success in managing
the risks implied by the foregoing. A substantial amount of the
Bank's business involves making loans or otherwise committing
resources to specific companies, industries or countries.
Unforeseen events affecting such borrowers, industries or countries
could have a material adverse effect on the Bank's financial
results, businesses, financial condition or liquidity. These and
other factors may cause the Bank's actual performance to differ
materially from that contemplated by forward-looking statements.
The Bank cautions that the preceding list is not exhaustive of all
possible risk factors and other factors could also adversely affect
the Bank's results, for more information, please see the "Risk
Management" section of the Bank's 2019 Annual Report, as may be
updated by quarterly reports.
Material economic assumptions underlying the forward-looking
statements contained in this document are set out in the 2019
Annual Report under the headings "Outlook", as updated by quarterly
reports. The "Outlook" sections are based on the Bank's views and
the actual outcome is uncertain. Readers should consider the
above-noted factors when reviewing these sections. When relying on
forward-looking statements to make decisions with respect to the
Bank and its securities, investors and others should carefully
consider the preceding factors, other uncertainties and potential
events.
Any forward-looking statements contained in this document
represent the views of management only as of the date hereof and
are presented for the purpose of assisting the Bank's shareholders
and analysts in understanding the Bank's financial position,
objectives and priorities, and anticipated financial performance as
at and for the periods ended on the dates presented, and may not be
appropriate for other purposes. Except as required by law, the Bank
does not undertake to update any forward-looking statements,
whether written or oral, that may be made from time to time by or
on its behalf.
Additional information relating to the Bank, including the
Bank's Annual Information Form, can be located on the SEDAR website
at www.sedar.com and on the EDGAR section of the SEC's website at
www.sec.gov.
November 26, 2019
Shareholder and investor information
Direct deposit service
Shareholders may have dividends deposited directly into accounts
held at financial institutions which are members of the Canadian
Payments Association. To arrange direct deposit service, please
write to the transfer agent.
Dividend and Share Purchase Plan
Scotiabank's dividend reinvestment and share purchase plan
allows common and preferred shareholders to purchase additional
common shares by reinvesting their cash dividend without incurring
brokerage or administrative fees. As well, eligible shareholders
may invest up to $20,000 each fiscal
year to purchase additional common shares of the Bank. All
administrative costs of the plan are paid by the Bank. For more
information on participation in the plan, please contact the
transfer agent.
Dividend dates for 2020
Record and payment dates for common and preferred shares,
subject to approval by the Board of Directors.
Record
Date
|
Payment
Date
|
January 7,
2020
|
January 29,
2020
|
April 7,
2020
|
April 28,
2020
|
July 7,
2020
|
July 29,
2020
|
October 6,
2020
|
October 28,
2020
|
Annual Meeting date for fiscal 2019
Shareholders are invited to attend the 188th Annual Meeting of
Holders of Common Shares, to be held on April 7, 2020, at Scotiabank Centre, Scotia
Plaza, 40 King Street West, 2nd Floor, Toronto, Ontario beginning at 9:00 a.m. local time. The record date for
determining shareholders entitled to receive notice of and to vote
at the meeting will be the close of business on February 11, 2020.
Duplicated communication
If your shareholdings are registered under more than one name or
address, multiple mailings will result. To eliminate this
duplication, please write to the transfer agent to combine the
accounts.
Normal Course Issuer Bid
A copy of the Notice of Intention to commence the Normal Course
Issuer Bid is available without charge by contacting the Investor
Relations Department at (416) 775-0798 or
investor.relations@scotiabank.com.
Annual Financial Statements
Shareholders may obtain a hard copy of Scotiabank's 2019 audited
annual consolidated financial statements and accompanying
Management's Discussion & Analysis on request and without
charge by contacting the Investor Relations Department at (416)
775-0798 or investor.relations@scotiabank.com.
Website
For information relating to Scotiabank and its services, visit
us at our website: www.scotiabank.com.
Conference call and Web broadcast
The quarterly results conference call will take place on
November 26, 2019, at 8:00 a.m. EST and is expected to last
approximately one hour. Interested parties are invited to access
the call live, in listen-only mode, by telephone, at (416) 641-6104
or 1 (800) 952-5114 (North America
toll-free) using access code 2851732# (please call five to 15
minutes in advance). In addition, an audio webcast, with
accompanying slide presentation, may be accessed via the Investor
Relations page of www.scotiabank.com. Following discussion of the
results by Scotiabank executives, there will be a question and
answer session.
A telephone replay of the conference call will be available from
November 26, 2019, to December 26, 2019, by calling (905) 694-9451 or 1
(800) 408-3053 (North America
toll-free) and using access code 2252239#. The archived audio
webcast will be available on the Bank's website for three
months.
Contact information
Investors:
|
Media:
|
Scotiabank
|
Contact the Global
Communications Department
|
Scotia Plaza, 44 King
Street West
|
Scotia Plaza, 44 King
Street West
|
Toronto, Ontario,
Canada M5H 1H1
|
Toronto, Ontario,
Canada M5H 1H1
|
Telephone: (416)
775-0798
|
E-mail:
corporate.communications@scotiabank.com
|
E-mail:
investor.relations@scotiabank.com
|
|
Shareholders:
|
|
For enquiries related
to changes in share registration or address,
dividend information, lost share certificates, estate transfers,
or
to advise of duplicate mailings, please contact the Bank's
transfer
agent:
|
For other shareholder
enquiries, please contact the Corporate
Secretary's Department:
|
|
|
Computershare Trust
Company of Canada
|
Scotiabank
|
100 University
Avenue, 8th Floor
|
Scotia Plaza, 44 King
Street West
|
Toronto, Ontario,
Canada M5J 2Y1
|
Toronto, Ontario,
Canada M5H 1H1
|
Telephone:
1-877-982-8767
|
Telephone: (416)
866-3672
|
Fax:
1-888-453-0330
|
E-mail:
corporate.secretary@scotiabank.com
|
E-mail:
service@computershare.com
|
|
|
Co-Transfer Agent
(U.S.A.)
|
Computershare Trust
Company N.A.
|
250 Royall
Street
|
Canton, MA 02021
U.S.A.
|
Telephone:
1-800-962-4284
|
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SOURCE Scotiabank