#1Strategy in action Investor Presentation First Quarter, 2012 March 6, 2012 welcome men Scotiabank Caution Regarding Forward-Looking Statements 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, or in other communications. All such statements are made pursuant to the "safe harbour" provisions of the United States Private Securities Litigation Reform Act of 1995 and any applicable Canadian securities legislation. Forward-looking statements may include comments with respect to the Bank's objectives, strategies to achieve those objectives, expected financial results (including those in the area of risk management), and the outlook for the Bank's businesses and for the Canadian, United States and global economies. Such statements are typically identified by words or phrases such as "believe," "expect," "anticipate," "intent," "estimate," "plan," "may increase," "may fluctuate," and similar expressions of future or conditional verbs, such as "will," "should," "would" and "could." By their very nature, forward-looking statements involve numerous assumptions, inherent risks and uncertainties, both general and specific, and the risk that predictions and other forward-looking statements will not prove to be accurate. Do not unduly rely on forward-looking statements, as a number of important factors, many of which are beyond our control, could cause actual results to differ materially from the estimates and intentions expressed in such forward-looking statements. These factors include, but are not limited to: the economic and financial conditions in Canada and globally; fluctuations in interest rates and currency values; liquidity; significant market volatility and interruptions; the failure of third parties to comply with their obligations to us and our affiliates; the effect of changes in monetary policy; legislative and regulatory developments in Canada and elsewhere, including changes in tax laws; the effect of changes to our credit ratings; amendments to, and interpretations of, risk-based capital guidelines and reporting instructions and liquidity regulatory guidance; operational and reputational risks; the risk that the Bank's risk management models may not take into account all relevant factors; the accuracy and completeness of information the Bank receives on customers and counterparties; the timely development and introduction of new products and services in receptive markets; the Bank's ability to expand existing distribution channels and to develop and realize revenues from new distribution channels; the Bank's ability to complete and integrate acquisitions and its other growth strategies; changes in accounting policies and methods the Bank uses to report its financial condition and the results of its operations, including uncertainties associated with critical accounting assumptions and estimates; the effect of applying future accounting changes; global capital markets activity; the Bank's ability to attract and retain key executives; reliance on third parties to provide components of the Bank's business infrastructure; unexpected changes in consumer spending and saving habits; technological developments; fraud by internal or external parties, including the use of new technologies in unprecedented ways to defraud the Bank or its customers; consolidation in the Canadian financial services sector; competition, both from new entrants and established competitors; judicial and regulatory proceedings; acts of God, such as earthquakes and hurricanes; the possible impact of international conflicts and other developments, including terrorist acts and war on terrorism; the effects of disease or illness on local, national or international economies; disruptions to public infrastructure, including transportation, communication, power and water; 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 at 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. For more information, see the discussion starting on page 63 of the Bank's 2011 Annual Report. The preceding list of important factors is not exhaustive. 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. 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. The "Outlook" sections in this document are based on the Bank's views and the actual outcome is uncertain. Readers should consider the above-noted factors when reviewing these sections. 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. Scotiabank#2Strategy in action Overview Rick Waugh President & Chief Executive Officer Q1 2012 Overview Strong quarter • • • - Net income: $1,436 million Scotiabank - EPS: $1.20, up 11% vs. prior year • • Includes $0.08 gain on sale of a real estate asset in Calgary EPS up 9% excluding real estate gain as well as pension recovery and IFRS-related FX gain in 2011 ROE: 19.8% Record revenue - Total revenue of $4,715 million, up 11% vs. prior year (8% ex-gain) Completed Banco Colpatria acquisition Credit conditions continue to be stable Capital position remains strong and high quality • Expenses aligned to revenue growth Delivered positive operating leverage Scotiabank#36 Strategy in action Financial Review Sean McGuckin Executive Vice-President & Chief Financial Officer Strong Results in Challenging Environment Scotiabank Q1/12 Q4/11 Q/Q Q1/11 Y/Y $1,436 $1.201 $1,157 24% Net Income ($MM) $1,249 15% $0.97 24% EPS $1.08 11% 19.8% 16.4% 340 bps ROE 20.9% (110) bps 53.5% 57.9% (440) Bps Productivity Ratio 53.3% 20 bps (1) Including $0.08 impact from real estate gain Year-over-Year Comparison Q1 earnings benefited from... • • Impact of acquisitions, particularly DundeeWealth . Strong volume growth and transaction-based banking revenues Higher trading and insurance revenues Scotiabank Partly offset by... Higher operating expenses from acquisitions Lower margin Lower contribution from Thailand Pension and FX gains in 2011#48 Record Revenue Revenue (TEB) ($ millions) 4,715 4,262 4,322 835 499 • 760 1,489 1,500 1,244 2,258 2,334 2,380 Q1/11 Q4/11 Q1/12 Other Operating Income (TEB) Net Fee and Commission Revenues Net Interest Income (TEB) Scotiabank Year-over-Year Net interest income up 5% + Asset growth - Margin compression Net fee and commission revenues up 21% + Impact from acquisitions - Lower underwriting revenue Other operating income up 10% + Higher trading revenues - Lower contributions from associated corporations Quarter-over-Quarter Net interest income up 2% + Asset growth Net fee and commission revenues up 1% + Higher underwriting and transaction-based fees - Lower brokerage revenues Other operating income up 67% + Gain on sale of Calgary real estate asset + Higher trading revenues - Lower contributions from associated corporations Continue to Manage Expenses Prudently Non-Interest Expenses ($ millions) 2,489 2,507 2,249 727 692 629 366 392 345 Year-over-Year Expenses up 11% - Acquisitions accounted for over 80% of increase - Higher expenses mainly to support business growth + Prior year included $35MM gain from the wind-up of subsidiary's pension plan Excluding impact of acquisitions, pension gain and real estate gain, operating leverage was +2.0% 1,275 1,370 1,449 Q1/11 Q4/11 Q1/12 Other Premises & technology Salaries & employee benefits Scotiabank . Quarter-over-Quarter Expenses up 1% + Decrease in advertising and technology costs - Higher compensation due to higher staffing levels and seasonally higher stock-based compensation Excluding real estate gain and impact of acquisitions, operating leverage was +6.5%#59 10 Strong Capital Ratios: High Quality Capital Ratios (%) 12.3 11.8 12.0 12.2 11.4 9.9 9.6 9.6 9.3 9.11 8.5 . Q1/11 Q2/11 Q3/11 Tangible Common Equity Q4/11 Q1/12 Tier 1 • Internal capital generation of • • $804MM (vs. $635MM in Q1/11) Stock issued under DRIP: $146MM (vs. $127MM in Q1/11) Negatively impacted by Basel 2.5 and IFRS transition Successfully completed common equity offering early in Q2 • Remain confident of achieving 7% - 7.5% CET1 target by Q1 2013 (1) Pro forma common equity issue in February 2012 for gross proceeds of approximately $1.7 billion Scotiabank Matched Maturity Transfer Pricing Adopted matched maturity transfer pricing effective Q1/12 - Match the contractual and behavioural maturities of assets/liabilities - Restated 2011 business line results to ensure comparability . Largest impact is in Canadian Banking, where results are lower due to a higher net funding charge • International Banking minimally impacted ⚫ Global Wealth Management earnings increased due to stable pools of client cash balances ⚫ Global Banking & Markets minimally impacted with slight increase due to stable pools of corporate banking deposits • The net impact of the change in methodology reflected in the Other segment, which now shows a lower loss Scotiabank#611 12 Canadian Banking: Record Quarter 451 Net Income ($ millions) 475 419 Q1/11 Q4/11 Q1/12 Scotiabank • . • Year-over-Year Revenues up 2% + Strong asset and deposit growth + Higher transaction-based banking revenues - Lower margin PCLs down $29MM to $136MM Expenses up 5% + Virtually all due to pension recovery in Q1/11 Quarter-over-Quarter Revenues up 2% + Higher margin + Solid asset growth, higher credit fees in commercial banking PCLs stable Expenses down 4% + Lower staffing costs + Lower advertising and other seasonal costs International Banking: Strong Broad-Based Asset Growth Net Income ($ millions) 391 371 359 Q1/11 Q4/11 Scotiabank Q1/12 Year-over-Year Revenues up 11% + Strong loan growth and wider margins + Positive impact from Uruguay acquisitions PCLs up $11MM to $124MM Expenses up 12% - Higher compensation costs to support growth initiatives + More than half of growth due to acquisitions Quarter-over-Quarter Revenues up 1% + Strong broad-based commercial loan growth + Higher margin + Higher investment securities gains - Q4/11 negative goodwill related to recent acquisitions - Lower contribution from Thailand PCLs down $34MM to $124MM Expenses up 3% - Higher compensation costs and business taxes#713 14 Global Wealth Management: Solid Quarter Net Income ($ millions) 262 239 288 • Year-over-Year Revenues up 34% + Impact of DundeeWealth acquisition and solid organic AUM/AUA growth + Strong insurance revenues Expenses up 47% + Unchanged excluding DundeeWealth acquisition Q1/11 Q4/11 Q1/12 Scotiabank Quarter-over-Quarter Revenues up 3% + Strong insurance revenues - Lower brokerage fees due to challenging markets Expenses down 3% + Higher discretionary expenses in Q4/11 - Higher volume related expenses Global Banking & Markets: Strong Results 335 Net Income ($ millions) 243 311 Q1/11 Q4/11 Q1/12 Scotiabank Year-over-Year Revenues down 1% vs. very strong Q1/11 + Higher trading revenues in precious metals, FX and fixed income - Lower investment banking revenues - Lower margin PCLs of $5MM vs. $3MM recovery Expenses down 3% + Lower performance-based compensation Quarter-over-Quarter Revenues up 24% + Higher trading revenues in fixed income, equities and precious metals + Higher underwriting fees PCLs down $12MM to $5MM Expenses up 5% - Seasonally higher stock-based compensation + Lower technology costs#8Other Segment¹ Net Income ($ millions) Q1/11 Q4/11 Q1/12 (29) . (94) (123)³ (135) (138) After-tax real estate gain Q1/12 Other operating income + $111MM gain on sale of real estate asset - $19MM impairment loss on investment securities Q1/11 Other operating income - $27MM unfavorable impact in fair value of financial instruments used for asset liability management Q4/11 Other operating income - $11MM unfavorable impact in fair value of financial instruments used for asset liability management - $45MM net foreign exchange translation loss on AFS securities PCL + $30MM reversal of collective allowance for performing loans Includes Group Treasury, smaller operating segments, and other corporate items which are not allocated to a business line Restated to reflect adoption of matched maturity pricing in Q1/12 (3) Excluding after-tax real estate gain (1) Scotiabank (2) 15 Strategy in action Risk Review Rob Pitfield Group Head and Chief Risk Officer Scotiabank#917 18 Q1 2012 Risk Overview • Risk in credit portfolios continues to be well-managed - Overall credit quality of loan portfolios continues to improve Specific provisions remain stable • Continued stable performance in net impaired loan formations Exposures to "GIIPS" countries in Europe not material Market risk remains low and well controlled Average 1-day All Bank VaR: $17.5MM vs. $15.9MM in Q4/11 Scotiabank Stable Provisions for Credit Losses ($ millions) Q1/11 Q2/11 Q3/11 Q4/11 Q1/12 Canadian Retail 134 123 103 106 112 Canadian Commercial 31 23 43 29 24 165 146 International Retail 110 116 International Commercial 3 113 112 Global Wealth Management Global Banking & Markets (3) ༔ ༄s¢ = ཙྩཱ 146 135 136 116 129 125 (4) 10 29 (1) 126 158 124 1 1 11 8 17 Collective General Allowance - (30) (30) 15 I Total 275 270 250 281 265 PCL ratio (bps) ex. General 36 36 55 35 38 32 Scotiabank#1019 Canadian Banking: Residential Mortgage Portfolio ($ billions) $74 Ontario Total Portfolio: $146 Insured Uninsured 56% 44% Average LTV of uninsured mortgages is 55%¹ $22 $21 $17 $12 B.C. Scotiabank Alberta Quebec Other (1) LTV calculated based on the total outstanding balance secured by the property. Property values indexed using Stats Can New Housing Price Index. • Risk Outlook Asset quality remains strong - - Retail and Commercial portfolios stable and performing well Continued strength in Corporate portfolios Expect 2012 provisions to be in line to slightly higher than 2011 - ― Canadian Retail provisions stable International Retail provisions may grow due to acquisitions and growth in portfolios Corporate and Commercial provisions likely to remain range bound 20 Scotiabank#1122 Strategy in action Canadian Banking 2012 Outlook Anatol von Hahn Group Head, Canadian Banking Canadian Banking: 2012 Outlook . Retail & Small Business Banking: . Scotiabank Loan and deposit growth steady Auto business strong - Margin stabilizing - Focus on deposits, payments and wealth management Commercial Banking: - Continuing opportunities for asset and deposit growth PCLS: - - Retail deliquencies and PCLs have leveled off Commercial PCLs steady Operating leverage positive for the year Scotiabank#12Strategy in action International Banking 2012 Outlook Brian Porter Group Head, International Banking International Banking: 2012 Outlook Scotiabank • Loan & deposit growth outlook remains positive for 2012 • Diversified footprint expected to generate balanced earnings growth Organic growth initiatives are yielding favourable results . Expense management remains a high priority • Loan loss ratio expected to remain stable Closed acquisition of Banco Colpatria this quarter; Bank of Guangzhou expected to close later this year Scotiabank 24#13Strategy in action Global Wealth Management 2012 Outlook Chris Hodgson Group Head, Global Wealth Management Global Wealth Management: 2012 Outlook Scotiabank . Outlook is for good organic growth across the business • Global Insurance outlook is strong • • Strong AUA/AUM base to drive Wealth revenue growth DundeeWealth integration creating significant value ⚫ Cl investment performing well • Vigilant on expense management 26 Scotiabank#1428 Strategy in action Global Banking & Markets 2012 Outlook Mike Durland Group Head, Global Capital Markets & Co-CEO, Global Banking & Markets Scotiabank • . . • • Global Banking & Markets: 2012 Outlook Positive start to the year as market sentiment has improved Market challenges arising from European uncertainty are expected to create headwinds, but diversification of businesses is mitigating negative impact Implementation of significant new initiatives is substantially complete. Focus is now to grow core businesses and products Loan volumes should continue to rise Loan loss provisions expected to remain low Expense management initiatives are underway with an objective to maintain positive operating leverage Scotiabank#1530 Strategy in action Appendix Core Banking Margin (ex Trading) 2.21% 2.09% 2.09% 2.07% . 2.03% Q1/11 Q2/11 Q3/11 Q4/11 Q1/12 Scotiabank Q1 Margin impacted by Higher volumes of low spread deposits with banks • Wider spreads in International Banking (1) Represents Net Interest Income (TEB) as % of Average Total Assets excluding Average Total Assets relating to Scotiabank Global Banking and Markets Global Capital Markets business, consistent with the reclassification of net interest from trading operations to income from trading operations. Scotiabank#1631 32 Canadian Banking: Stable Margin Revenues (TEB) ($ millions) 1,523 1,517 1,553 377 355 393 1,146 1,162 1,160 Q1/11 Q4/11 Commercial Banking Retail & Small Business Scotiabank • Q1/12 Year-over-Year Retail & Small Business + Residential mortgage growth + Higher transaction-based fees and card. revenues - Lower margin Commercial Banking + Higher margin and volume growth -Shift in automotive portfolio mix to higher quality, lower yielding loans Quarter-over-Quarter Retail & Small Business + Growth in fixed rate mortgages Commercial Banking + Higher margin + Higher credit fees - Lower FX fees and card revenues Canadian Banking: Volume Growth Q1/12 Q4/11 Q/Q Average Balances ($ billions) Q1/11 Y/Y 144.6 142.1 1.8% Residential Mortgages 135.4 6.8% 38.4 38.1 0.8% Personal Loans 36.8 4.3% 8.9 8.9 Credit Cards¹ 8.9 Business Loans & 26.3 26.0 1.2% 24.4 7.8% Acceptances 102.7 101.2 1.5% Personal Deposits 99.8 2.9% 41.8 41.1 1.7% Non-Personal Deposits 38.4 8.9% (1) Includes ScotiaLine VISA Scotiabank#1733 34 International Banking: Solid Growth Revenues (TEB) ($ millions) 1,435 1,453 1,310 149 153 142 458 492 470 828 808 698 Q1/11 Asia Q4/11 Q1/12 Caribbean & Central America Latin America Scotiabank Latin America Year-over-Year + Strong commercial and solid retail loan growth, particularly in Peru, Chile and Mexico + Contribution of Uruguay acquisitions + Higher margin Caribbean & Central America + Good commercial loan growth + Higher investment securities gains Asia + Strong commercial loan growth and higher margins - Impacted by flooding in Thailand Quarter-over-Quarter Latin America + Strong broad-based commercial loan growth -Negative goodwill in Q4/11 - Timing of certain fees in Q4/11 in Chile and Mexico. Caribbean & Central America + Solid commercial loan growth + Increased margin + Higher investment securities gains Asia + Strong commercial volume growth and higher margins - Impacted by flooding in Thailand Global Wealth Management: Steady Performance Revenues (TEB) ($ millions) 859 838 132 145 643 120 706 714 523 Q1/11 Q4/11 Q1/12 Insurance Wealth Management Scotiabank Year-over-Year Wealth Management + Impact of DundeeWealth acquisition - Lower brokerage commissions Insurance + Strong sales globally Quarter-over-Quarter Wealth Management - Lower online brokerage revenues Insurance + Strong growth in global insurance revenues, including reserve releases#18Global Wealth Management: Key Metrics ($ billions) Q1/11 Q2/11 Q3/11 Q4/11 Q1/12 Assets Under Administration¹ 203 269 266 262 269 Assets Under Management¹ 56 106 105 103 106 Mutual Funds Market Share in Canada vs. Schedule 1 Banks² 9.3% 18.7% 18.7% 18.4% 18.4% (1) Comparative amounts have been restated to reflect intercompany relationships (2) Excludes Scotiabank's investment in CI Financial. As of Q2/11, includes DundeeWealth. Source: IFIC Scotiabank 35 36 Global Banking & Markets: Resilient Quarter Revenues (TEB) ($ millions) 857 846 • 680 450 470 305 Year-over-Year Global Capital Markets + Higher trading revenues from fixed income + Strong precious metals and FX Global Corp. & Investment Banking - Lower corporate banking revenues, primarily in the U.S. 407 375 376 Q1/11 Q4/11 Q1/12 Global Capital Markets Global Corporate & Investment Banking Quarter-over-Quarter Global Capital Markets + Record revenue from ScotiaMocatta Global Corp. & Investment Banking + Higher loan volumes - Lower margin Scotiabank#1937 38 Economic Outlook in Key Markets Real GDP (Annual % Change) 2000-10 Country 2011e 2012F 2013F Avg. Mexico 2.1 3.9 3.0 3.7 Peru 5.5 6.8 5.5 5.6 Chile 3.8 6.2 3.9 5.5 Jamaica 0.8 1.5 1.2 1.5 Trinidad & Tobago 5.9 (1.4) 1.3 2.5 Costa Rica 4.1 4.2 3.8 4.0 Dominican Republic 5.4 4.6 4.8 5.0 Thailand 4.4 0.1 3.8 4.5 2000-10 2011F 2012F 2013F Avg. Canada U.S. Scotiabank 2.2 2.5 2.0 2.1 1.8 1.7 2.1 2.2 Source: Scotia Economics, as of March 6, 2012. Unrealized Securities Gains ($ millions) Q1/12 Q4/11 Emerging Market Debt 260 320 Other Debt 321 258 Equities 406 385 987 963 Net Fair Value of Derivative Instruments (255) (227) and Other Hedge Amounts Total 732 736 Scotiabank#2039 40 Stable PCL Ratios (Total PCL as % of average loans & BAs) Q1/11 Q2/11 Q3/11 Q4/11 Q1/12 Canadian Banking Retail 0.29 0.28 0.22 0.22 0.23 Commercial 0.50 0.36 0.66 0.45 0.36 Total 0.32 0.29 0.27 0.25 0.25 International Banking Retail 1.76 1.95 1.83 1.98 1.90 Commercial (0.03) (0.04) 0.09 0.25 0.00 Total 0.69 0.70 0.73 0.87 0.65 Global Banking and Markets Corporate Banking (0.04) 0.15 0.12 0.21 0.06 All Bank (Collective & Individual) 0.36 0.36 0.35 0.38 0.32 Scotiabank Stable Trend in Net Impaired Loan Formations ($ millions) 500 419 400 372 300 200 100 276 254 228 0 Q1/11 Q2/11 Q3/11 Q4/11 Q1/12 Scotiabank#2141 42 Improving Trend in Gross Impaired Loans ($ billions) 3.7 3.6 3.5 3.4 Q1/11 Q2/11 Q3/11 Scotiabank GILS Q4/11 1.2% 1.1% 1.0% 0.9% Q1/12 GILS as % of Loans & BAS Canadian Banking: Retail Loans and Provisions $145 (Balances at Q1/12, $ billions) $23 Total = $190B; 93% secured $13 $9 % secured Mortgages 100% Lines of Credit Personal Loans Credit Cards 66% 98% 36%1 PCL Q1/12 Q4/11 Q1/12 Q4/11 Q1/12 Q4/11 Q1/12 Q4/11 $ millions 5 7 31 28 33 22 43 43 % of avg. 1 2 52 49 104 62 194 221 loans (bps) Scotiabank (1) Includes $6 billion of Scotialine VISA Note: Excludes Wealth Management balances of -$4 billion#2243 44 International Retail Loans and Provisions $13.7 $0.8 $2.9 Total Portfolio = $27.7B 74% secured (Balances at Q1/12, $ billions) Credit Cards ($2B) Personal Loans ($8.1B) Mortgages ($17.6B) $10.0 $4.6 $4.9 $0.1 $4.5 <$0.3 $0.9 $1.7 $0.8 $3.4 $3.1 $2.6 $1.1 % of total C&CA 49% Mexico 17% Chile Peru (+Other) 18% 16% PCL Q1/12 Q4/11 Q1/12 Q4/11 Q1/12 Q4/11 Q1/12 Q4/11 $ millions 29.5 47.0 27.1 32.0 21.4 14.2 46.6 36.2 % of avg. 86 143 233 264 175 114 436 385 loans (bps) Scotiabank International Commercial Lending Portfolio Q1/12 = $44 billion • Well secured • . Other 7% Mexico 11% Peru 13% Chile 15% Asia/Pacific (10 countries) 30% Caribbean & -Central America 24% Portfolios in Asia/Pacific, Mexico, Chile, Peru and Central America performing well Closely managing Caribbean hospitality portfolio Scotiabank#2345 46 Q1 2012 Trading Results and One-Day All Bank VaR ($ millions) 25 20 15 10 5 0 (5) (10). (15) (20) - (25) Мир -Actual P&L -1-Day All Bank VaR Scotiabank Average 1-Day All Bank VaR Q1/12: $17.5MM Q4/11: $15.9MM Q1 2012 Trading Revenue Distribution (# days) 9 8 7 6 5 4 3 2 1 0 (4) (3) (2) (1) 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 ($ millions) • 97% of days had positive results in Q1/12 Scotiabank