#1Scotiabank Investor Presentation Third Quarter, 2009 August 28, 2009 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; 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 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. For more information, see the discussion starting on page 62 of the Bank's 2008 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. 2#2Scotiabank Scotiabank Overview Rick Waugh President & Chief Executive Officer 3 Strong Third Quarter Financial Performance: EPS (diluted): $0.87, up 7% Q/Q Record revenues, up 11% Y/Y ROE: 18.0% Business line contribution: Record Quarters - Canadian Banking & Scotia Capital Credit Risk: - Provisions in line with expectations and moderating Capital: - Tier 1: 10.4% - TCE: 8% 4#3Scotiabank Scotiabank Outlook Positioned to Meet 2009 Targets Economies improving in most markets Targets are achievable: Objective Target - YTD Q3 2009 ROE 16% to 20% 17.5% EPS Growth 7% to 12% $3.26 to $3.42 $2.48 Productivity Ratio < 58% 53.5% Tier 1: 10.4% Capital Ratios Strong Capital Ratios TCE: 8% 5 Performance Review Luc Vanneste Executive Vice-President & Chief Financial Officer 6#4Scotiabank Strong Quarter Q3/09 Reported Qtr/Qtr Yr/Yr Net income ($MM) $931 +7% (8)% EPS $0.87 +7% (11)% ROE 18.0% 40 bps (300) bps 51.0% (40) bps (330) bps Productivity ratio Quarter over quarter + Strong capital markets related revenues, driven by record trading revenues + Increased margin + Higher wealth management revenues - Negative impact of forex - Higher provisions for credit losses Lower securitization revenues Scotiabank Revenues (TEB) ($ millions) 3,843 3,673 3,477 1,599 1,509 1,428 2,049 2,164 2,244 Q3/08 Q3/09 Q2/09 Other income Net Interest Income (TEB) 7 Record Revenues Q3/09 vs. Q2/09 revenues: up 5% ■ net interest income up 4% + higher margin, longer quarter negative impact of forex & lower asset volumes ■ other income up 6% + excellent trading revenues, higher mutual fund fees + increase in fair value of financial instruments (FI) - lower securitization revenues vs. high level in Q2 -negative impact of forex Q3/09 vs. Q3/08 revenues: up 11% ■ net interest income up 10% + broad-based asset growth, positive impact of forex + increase in fair value of FI lower margin ■ other income up 12% + significantly higher trading revenues + increased credit fees, investment banking revenues & securitization revenues + positive impact of forex, increase in fair value of FI losses on investment securities vs. gains in Q3/08 8#5Scotiabank Asset Balances Impacted by Forex & Securitizations Total Assets Balances as at July 31, 2009, $ billions Risk Weighted Assets ($ billions) ($ billions) (5)% (8)% 514 242 Residential 486 Residential Mortgages 10 222 mortgages 20 111 10 98 20 Personal Loans Personal loans 53 54 94 83 Non-personal Loans & Business & 136 119 Acceptances government (includes BAs) 18 16 Securities Securities 112 126 93 87 Other 102 89 Cash, Other Assets & Off Balance Sheet Items AIRB Scaling Factor Q2/09 Q3/09 Q2/09 Q3/09 Forex Impact: $(17) B Mortgages: $(13)B & Securities: +$14B mortgages converted to MBS Business & Gov't Loans: $(17)B paydown of corporate loans & forex RWA declined $20B Q/Q: impact of forex: $(13)B underlying reduction in: ⚫ business volumes: $(10)B • portfolio migration: +$3B 9 Scotiabank (%) 10 Higher Net Interest Margin 1.79 1.68 1.53 1.71 1.76 Q3/08 Q4/08 Q1/09 Q2/09 All-Bank: +5 bps qtr/qtr + Asset re-pricing + Higher loan origination fees + Lower non-earning assets 10 Q3/09#6Scotiabank Disciplined Expense Management Non-interest expenses ($ millions) 1,889 1,959 1,886 1,068 1,024 1,093 379 382 361 460 483 484 - Q3/08 Q2/09 Q3/09 Salaries & employee benefits Premises & technology Other Scotiabank Q3/09 vs. Q2/09 expenses: up 4% - underlying expenses remain very well controlled higher performance based compensation increased stock based compensation + positive impact of forex Q3/09 vs. Q3/08 expenses: up 4% expenses down 1% excluding acquisitions & forex growth initiatives lower advertising & professional fees 11 Higher Capital Ratios Capital ratios (%) Q/Q + internal capital generation: $0.4B 10.4 + new capital issuance: $0.8B (1) Tier 1 9.8 9.5 9.6 9.3 + underlying RWA decline: $7.0B TCE 7.6 7.8 7.7 8.0 7.3 Q3/08 Q4/08 Q1/09 Q2/09 (1) Includes DRIP Q3/09 12 Y/Y + internal capital generation: $0.8B + new capital issuances: $1.8B + common share issuance: $1.0B (1)#7Scotiabank Net Income ($ millions) 463 410 500 Canadian Banking Record Quarter Q3/09 vs. Q2/09 net income: up 22% + revenues up 8% - + higher margin, 3 extra days + increased wealth management revenues, benefitting from stronger market conditions & market share gains + PCLs down $19MM due to lower commercial provisions & $10MM sectoral in Q2 expenses up 4% - increased commissions & stock based compensation - 3 extra days Q3/09 vs. Q3/08 net income: up 8% + revenues up 7% + strong volume growth, impact of acquisitions - lower margin PCLs up $70MM expenses up only 2% - acquisitions, partly offset by strong cost control Q3/08 - Q2/09 Q3/09 Scotiabank Net Income ($ millions) 13 International Banking Solid Underlying Quarter Q3/09 vs. Q2/09 net income: down 6% revenues down 3%, or up 3% ex. forex - + FV changes in certain financial instruments + $36MM Q2 loss on sale of credit card portfolio + widening interest margins - $79MM write-down on an equity investment PCLs up $35MM net of Q2 reversal of $29MM in Mexico + expenses down 2%, due to forex Q3/09 vs. Q3/08 net income: down 7% + revenues up 3% + positive impact of forex & acquisitions + underlying loan growth and wider interest margins 335 332 312 - $40MM IPO gain in Mexico last year - Q3/08 Q2/09 Q3/09 securities write-downs, largely offset by FV changes PCLs up $123MM (incl. $44MM from acquisitions) - expenses up 3% - acquisitions & branch expansion 14#8Scotiabank Net Income ($ millions) 470 328 297 Q3/08 Q2/09 Scotiabank Q3/09 Scotia Capital Record Quarter Q3/09 vs. Q2/09 net income: up 43% + revenues up 30% + record quarter in GCM + record quarter in GCIB + higher spreads, loan origination & credit fees - partly offset by decrease in average loans negative impact of forex translation + PCLs down $53MM + Q2/09 $50MM sectoral - expenses up 15% +higher performance based compensation Q3/09 vs. Q3/08 net income: up 58% + revenues up 69% + very strong results in GCM + loan growth, with significantly wider spreads +higher loan origination, credit fees + FV changes in securities + positive impact of forex PCLs up $102MM, from low level in Q3/08 expenses up 5% + higher technology costs, legal provisions & support costs, offset by lower performance based comp. 15 Other Segment (1) ($MM) Q3/08 Q2/09 Q3/09 Funding Net Interest Income (72) (115) (151) Net Securitization Revenues (2) (12) 67 (96) AFS Securities Write-downs (3) (23) (97) (95) General Provision (27) (100) Expenses & Net Other Items (13) (35) (41) Taxes (Excl. TEB Offset) 35 9 132 Total Other (85) (198) (351) (1) includes Group Treasury and other corporate items, which are not allocated to a business line (2) represents the impact to the Bank of CMB securitization revenues recognized in other income, and the reduction in mortgage net interest income earned by the Bank as a result of removing the mortgages from the Balance Sheet (3) represents the portion of the Bank's AFS securities write-downs which were reported in the Other segment 16#9Scotiabank Scotiabank ☐ Risk Review Brian Porter Group Head, Risk & Treasury 17 Q3/09 Risk Overview - Portfolios performing within expectations Specific provisions for credit losses: $466MM vs. $402MM in Q2/09 Solid coverage ratios Added $100MM to general allowance - now at $1.45 billion Total allowance to gross impaired loans ratio of 75% Market risk well controlled 18#10Scotiabank $ millions Moderate Increase in Specific Provisions Quarter-over-Quarter Q3/08 Q4/08 Q1/09 Q2/09 Q3/09 Specific Canadian 99 107 155 178 170 International 56 90 116 115* 179 Scotia Capital 4 10 10 109 117 Total 159 207 281 402 466 Sectoral Canadian Scotia Capital General * net of $29MM provision reversal in Mexico 10 (1) 50 (11) 60 (12) 27 100 159 207 281 489 554 19 Retail: Underlying Provisions Stable Quarter-over-Quarter Scotiabank specific provisions, $ millions 283 252 251 146 183 130 125* 158 105 81 122 126 137 77 78 Q3/08 Q4/08 Q1/09 Canadian Banking PCL ratio (bps) 40 44 * net of $29MM provision reversal in Mexico Q2/09 Q3/09 International Banking 61 20 63 70#11Scotiabank Commercial/Corporate: Higher Provisions in International specific provisions, $ millions 183 151 117 109 29 24 1 10 10 52 52 29 33 22 T T -15 -14 -10 -25 33 3 33 Canadian Banking Q3/08 International Banking Scotia Capital Q4/08 Q1/09 Q2/09 Q3/09 PCL ratio (bps) - 8 9 47 61 Scotiabank 21 Solid Coverage Ratios Earnings Coverage of PCL* (YTD) 3.7x Specific Allowance (Q3/09) as a % of gross impaired loans 37% Total Allowances (Q3/09) as a % of: - gross impaired loans - total loans & acceptances * pre-tax, pre-provision income to total PCL 22 75% 1.1%#12Scotiabank Trading Results Within One-Day VaR ($ millions) 30 4321 40 20 10 0 (10). (20) (30) (40) Scotiabank May 1, 2009 to July 31, 2009 измили Actual P&L 1 day VaR Average one-day VaR: $15.5MM in Q3/09 vs. $16.0MM in Q2/09 23 Risk Outlook Signs of Canadian & U.S. portfolios stabilizing Continuing pressure in some International portfolios • Overall pace of credit migration moderating . Provisions in line with expectations 24#13Scotiabank Business Line Outlook Chris Hodgson Group Head, Canadian Banking Rob Pitfield Group Head, International Banking Stephen McDonald Group Head, Global Corporate & Investment Banking, & Co-CEO Scotia Capital Scotiabank . • 25 Canadian Banking Update Focused revenue growth - Growing wealth management platform, maximizing cross-sell > Scotia Funds: Led industry in net sales during July - Expanding insurance offerings - home, auto & life - Introducing innovative deposit products Loan loss provisions stabilizing - Stabilizing delinquencies in retail and commercial Optimizing cost base - Improving branch efficiency to maximize employee's sales time Leadership - New EVP, Personal and Commercial Banking 26#14Scotiabank • • • International Banking Update Driving revenue in core businesses Upgrading delivery channels - Improving effectiveness of sales teams Expanding wealth, insurance Maintaining credit risk discipline Disciplined expense management Leadership - New EVP, Sales & Service, Products & Marketing New EVP, Latin America Scotiabank 27 Scotia Capital Update Strong, broad-based revenues - Benefit of diversification Taking advantage of current market opportunities Re-pricing continues Strategic revenue enhancement initiatives Prudently managing credit and market risks Provisions well within expectations and risk appetite Reducing risk in trading activities Leadership New EVP & Chief Administration Officer 28#15Scotiabank Scotiabank Appendices 29 Impact of Forex Impact ($ millions) Q3/09 vs. Q2/09 Q3/09 vs. Q3/08 Net Interest Income (TEB) (83) 50 Other Income (39) 27 Non-interest expenses 34 (8) Net income (63) 55 EPS (diluted) (6) cents 5 cents Average Rates Q3/09 Q2/09 Q3/08 $US/$CAD 0.88 0.80 0.99 Mexican peso/$CAD 11.53 11.51 10.16 Peruvian new sol/$CAD Chilean peso/$CAD 2.66 472.99 30 2.54 2.85 482.06 494.33#16€ Scotiabank Canadian Banking Record Quarter Change ($MM) Q3/09 Q2/09 Q/Q NII 1,212 1,147 +65 Other 593 524 +69 Income Comments on Q/Q Movements higher margin, benefitting from re-pricing ■ 3 extra days higher wealth management revenues ■ increase in equity accounted earnings from DundeeWealth (DW) & CI ■ underlying expenses remain well controlled Expenses 933 899 (34) " higher commissions, 3 extra days PCL 169 188 +19 Net Income 500 410 +90 ■ lower commercial PCLs, $10MM auto sectoral in Q2 higher retail PCLS driven by credit cards ■record quarter ■ prudent risk and expense management, higher wealth management earnings 31 Scotiabank Canadian Banking Higher Margin, Wealth Management Revenues Revenues (TEB) ($ millions) 1,805 1,686 1,671 Q3/09 vs. Q2/09 revenues: up 8% + higher margin, 3 extra days + increased wealth management revenues, including higher equity accounted earnings from DW & CI 1,125 1,050 1,045 353 388 382 283 244 292 Q3/08 Q2/09 Retail & Small Business Commercial Banking Wealth Management Q3/09 Q3/09 vs. Q3/08 revenues: up 7% Retail & Small Business + asset & deposit growth + higher margin Commercial Banking + increased margin due partly to re-pricing + higher credit fees Wealth Management + higher Cl contribution & Scotia iTRADE acquisition - lower full service brokerage & mutual fund revenues due to market conditions 32#17Scotiabank Canadian Banking Volume Growth Average Balances ($BN) Q3/09 Q2/09 Q3/08 Y/Y Q/Q Residential 119.9 118.0 112.3 6.7% 1.6% Mortgages* Personal Loans 35.8 34.2 29.6 21.0% 4.6% Credit Cards** 9.2 9.1 8.8 4.5% 0.7% Non-Personal Loans & 25.0 25.7 25.9 (3.6)% (2.8)% Acceptances Personal Deposits 93.8 92.3 85.2 10.1% 1.6% Non-Personal 52.5 48.9 43.3 21.5% 7.4% Deposits Wealth Mgmt. 126.8 116.2 130.3 AUA (2.7)% 9.1% * before securitization ** Includes ScotiaLine VISA Scotiabank 33 International Banking Solid Underlying Quarter Q3/09 Q2/09 Change Q/Q Comments on Q/Q Movements ■ improved margins NII 979 959 20 Other 296 349 Income (53) ■ decrease in average assets, mainly forex impact ■ $(79)MM write-down on an equity investment ■ lower treasury & transaction driven revenues positive FV changes in certain financial instruments ■ $36MM Q2/09 loss on sale of a portion of Mexico's performing credit card portfolio Expenses 718 729 (11) ■ down 2% due to forex PCL 179 115 64 Net Income 312 332 (20) ■ Q2/09 benefited from reversal of a $29MM retail provision no longer required in Mexico ▪ some commercial PCLs (vs Q2/09 net recoveries) ■up 1% excluding forex ■ continued focus on expense & risk management 34#18Scotiabank International Banking Stable Underlying Revenues Revenues (TEB) ($ millions) 1,308 1,275 1,236 295 292 382 503 395 440 588 510 414 Q3/08 Mexico Q2/09 Q3/09 ■Caribbean & Central America Latin America & Asia Q3/09 vs. Q2/09 revenues: down 3% ■up 3% excluding forex ■ Mexico + Q2 loss on sale of portion of credit card portfolio - lower margin ■ Caribbean & Central America - $79MM write-down of an equity investment ■ Latin America & Asia + FV changes in certain financial instruments Q3/09 vs. Q3/08 revenues: up 3% ■ Mexico negative forex impact - Q2/08 gain on Mexico Stock Exchange IPO higher funding costs and negative Fl impact + higher loan volumes & spreads, and FX revenues ■ Caribbean & Central America $79MM write-down of an equity investment - spread compression with lower interest rates + solid retail loan growth + positive impact of forex Latin America & Asia + positive impact of forex + acquisition in Peru & investment in Thailand + FV changes in certain financial instruments 35 Scotiabank International Increased Diversification Q3/07 Revenue: $953MM Q3/09 Revenue: $1,275MM Other LA & Asia 6% Mexico 34% C&CA 43% Peru 13% Chile 4% +34% Other LA & Asia 17% 36 Mexico 23% Peru 18% C&CA 31% Chile 11%#19Scotiabank Economic Outlook in Key Markets Real GDP (annual % change) 2000-07 Avg. 2008 2009f 2010f Mexico 2.9 1.3 (6.8) 3.4 Peru 5.1 9.8 2.3 4.2 Chile 4.4 3.2 (1.5) 3.0 Jamaica 1.5 (0.6) (4.0) 1.0 Trinidad & Tobago 8.2 3.5 (0.5) 3.0 Costa Rica 4.7 2.9 (1.5) 1.8 DR 5.4 4.8 0.5 2.0 Thailand 4.9 2.9 (3.0) 3.5 2000-07 Avg. 2008 2009f 2010f Canada 2.9 0.4 (2.2) 2.6 U.S. 2.6 0.4 (2.5) 3.0 Source: BNS Economics, as of August 26th, 2009 37 Scotiabank Scotia Capital Record Quarter ($MM) Q3/09 Q2/09 Change Q/Q NII 423 345 +78 Comments on Q/Q Movements higher capital markets interest ■ wider lending spreads & higher loan origination fees, largely offset by decrease in average loans Other ■ stronger capital markets revenues 681 502 +179 Income ■ higher investment banking revenues and credit fees Expenses 266 231 -35 ■ higher performance based compensation, in line with results PCL 106 159 +53 Net Income 470 328 +142 ■ higher technology costs and legal provisions ■ Q3/09 reflects $117MM specifics less $11MM reclassified from auto sectoral provision ■ a few accounts in the U.S. & Canada ▪Q2/09 included $50MM auto sectoral provision ■ record quarter ■ strong & diversified revenues, with good expense control and lower PCLS 38#20Scotiabank Revenues (TEB) ($ millions) 847 Scotia Capital Record Revenues 1,104 614 652 400 Q3/09 vs. Q2/09 revenues: up 30% Global Capital Markets + broad based strength, particularly higher derivatives revenues Global Corporate & Investment Banking + higher spreads, loan origination & credit fees, partly offset by lower average loan volumes 354 490 447 298 Q3/08 Q2/09 Q3/09 Global Capital Markets (GCM) Global Corporate & Investment Banking (GC&IB) Q3/09 vs. Q3/08 revenues: up 69% Global Capital Markets + record revenues in derivatives + strong results in fixed income, foreign exchange, equity trading, underwriting and precious metals Global Corporate & Investment Banking + higher loan volumes, interest margins, loan origination fees, and credit fees + FV changes in securities Scotiabank 39 Trend in PCL Ratios PCL as % average of loans & BAS Q3/08 Q4/08 Q1/09 Q2/09 Q3/09 Canadian Banking Retail Commercial Total 0.20 0.20 0.30 0.32 0.33 0.34 0.42 0.50 0.83 0.52 0.22 0.23 0.33 0.39 0.36 International Banking Retail 1.64 2.01 2.32 2.24 2.67 Commercial -0.28 -0.15 -0.12 -0.09 0.32 Total 0.40 0.59 0.69 0.70 1.14 Scotia Capital (lending 0.04 0.10 0.07 0.87 1.10 * book only) All Bank 0.23 0.29 average loans & BAs in Scotia Capital's lending book decreased $9B vs. Q2/09 40 0.37 0.56 0.66#21Scotiabank Improving Coverage on Loan Portfolio Total Allowance for Credit Losses as % of Loans and Acceptances 0.95% 0.87% 0.87% 0.88% 1.10% Q3/08 Q4/08 Q1/09 Q2/09 Q3/09 41 Scotiabank Gross Impaired Loan Formations $ millions Q2/09 Q3/09 Canadian P&C Canadian Retail: formations stable in residential mortgages, lower in auto loans - Retail 436 409 - Commercial 115 91 551 500 Canadian Commercial: classification of several small accounts International P&C - Retail 266 276 - Commercial 97 278 363 554 Scotia Capital - Canada 167 75 - U.S. & Europe 149 130 316 205 Total 1,230 1,259 Int'l. Retail: higher formations in Mexico & Peru; lower formations in Chile Int'l. Commercial: classification of a resort hotel in Dominican Republic and a number of accounts in various geographies Scotia Capital: classification of a media account in Canada; parts manufacturer, two real estate accounts & two other accounts in U.S. 42#22Scotiabank $ millions Gross Impaired Loans Q3/08 Q4/08 Q1/09 Q2/09 Q3/09 Canadian P&C Retail 472 523 621 747 796 Commercial 228 238 262 307 330 700 761 883 1,054 1,126 International P&C Retail 688 833 997 1,110 1,177 Commercial 674 776 919 994 1,143 1,362 1,609 1,916 2,104 2,320 Scotia Capital 101 124 186 439 547 Total 2,163 2,494 2,985 3,597 3,993 % loans & acceptances 0.76 0.82 0.97 1.20 1.47 Scotiabank 43 Canadian and International Retail Portfolios • Portfolios performing as expected • • - - Highly secured and well diversified - Modest increase in gross impaired loans due to: - Canada slight increase in revolving credit delinquency; minor decline in mortgages International softness in some markets due to economic cycle Coverage ratios to continue at appropriate levels Actively managing risks - Canada: indirect auto and unsecured revolving credit - International: Chile and Peru acquisitions, Mexico retail Continue to mitigate risks - Selective policy changes and risk-based pricing - Targeted payment relief for certain customers - Investing in collections staff and technology 44#23Scotiabank (Outstandings at Q3/09, $ billions) 122 Canadian Retail Loans and Provisions Total = $164B -- 92% secured 22 11 9 % secured Mortgages* 100% Lines of Credit Personal Loans Credit Cards** 70% 95% 35% PCL Q2/09 Q3/09 Q2/09 Q3/09 Q2/09 Q3/09 Q2/09 Q3/09 SMM 2 1 22 23 67 68 35 45 % of avg. loans (bps) 1 1 45 41 241 237 158 194 *before securitizations of $18B & mortgages converted to MBS of $20B 54% insured; LTV in mid-50s for uninsured portfolio ** includes $6 billion of Scotialine VISA 45 Scotiabank (Outstandings at Q3/09, $ billions) International Retail Loans and Provisions 10.5 3.1 Personal Loans (total = $6.7B) Credit Cards (total = $1.9B) ■Mortgages (total = $ 13.3B) 0.9 5.2 1.4 4.0 6.5 -0.4 11 0.1 2.2 3.4 2.8 1.1 0.5 0.6 C&CA* % of total 48% Mexico 24% Chile Peru 18% 10% PCL Q2/09 Q3/09 Q2/09 Q3/09 Q2/09 Q3/09 Q2/09 Q3/09 $MM 33 36 38 46 15 15 39 49 % of avg. loans (bps) 120 130 302 349 154 149 654 833 Caribbean and Central America Total Portfolio = $22B -- 78% secured 46#24International Commercial Portfolio Scotiabank loans & acceptances Mexico 11% Q3/09 = $34 billion Peru 10% Other Asia/Pacific (10 countries) 27% 7% Chile 18% " Well secured ■ Scotiabank Financial Services Holding Companies Hotels & Gaming 9% 2% 7% Communications & Media 5% Automotive 3% Agrifoods and Consumer 17% Caribbean Central America 27% Industrial Products 5% Infrastructure, Privatization & Power 14% Other 17% Transportation 9% Real Estate 12% Portfolios in Asia/Pacific and Peru are performing well Closely monitoring portfolios in Mexico and Caribbean & Central America Hotel exposures Impact of U.S. slowdown in Mexico 47 Quarterly Decline in Wholesale Auto Portfolio $ billions Canada Total Total U.S. Other Q3/09 Q2/09 Wholesale(1) OEM(2) 0.1 0.1 Finance & Leasing 0.7 ཅ8 0.2 0.2 0.2 0.1 1.0 1.1 Parts Manufacturers 0.2 0.3 0.1 0.6 0.8 Dealers/Floorplan 2.5 2.5 2.9 3.5 0.6 0.2 4.3 5.0 ■ GM & Chrysler only 8% of dealer exposure " Portfolio regularly stress tested ◉ ■ C$12 million utilized in Q3/09 out of C$60 million sectoral provision established in Q2/09 Year-to-date loss ratio: 47 bps (1) loans and acceptances (2) Original Equipment Manufacturers 48#25Scotiabank $ billions Small U.S. Real Estate Exposure Canada U.S. Total(1) Q3/09 Total(1) Q2/09 Residential 3.1 0.3 3.4 3.8 Commercial & Industrial 0.9 0.9 1.0 Office 0.5 0.1 0.6 0.7 Retail 1.0 0.3 1.3 1.2 REITS 0.4 1.1 1.5 1.8 5.9 1.8 7.7 8.5 " Cdn. Residential: Single Family (55%), Condominium (21%), Income Producing (24%) Development deals with experienced, long-term clients " REITs are primarily liquidity facilities to investment grade borrowers Year-to-date loss ratio: 44bps - relates primarily to US condo construction (1) loans and acceptances Scotiabank 49 Bank-Sponsored Multi-Seller Conduits (Q3/09, $ billions) Funded assets Weighted-average: rating (equivalent) life (years) Canadian Conduits 2.0 U.S. Conduit (Q2/09: 2.5) 4.7 (Q2/09: 5.6) AA- or higher 74% A or higher 1.0 1.4 Volume down 11% vs. last quarter Assets mostly receivables auto loans/leases: 40%, trade: 22%, equipment loans: 13%, diversified ABS: 11% ☐ No direct CDO or CLO exposure 50#26Scotiabank # days 10 8 6 2 Trading Revenue Q3/09 Trading Revenue ($ millions) (7) (6) (5) (4) (3) (2) (1) 0 1 2 3 4 56 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 ■ 91% days had positive results in Q3/09 vs. 86% in Q2/09 51 Scotiabank Unrealized Securities Gains* ($ millions) Q2/09 Q3/09 Emerging Market Debt 375 456 Fixed Income Equities Improvement in value of fixed income investments (1,555) (386) primarily due to narrowing of credit spreads (328) (25) Increase in equities due to rising market values and write-downs taken (1,508) 45 *before related derivative and other hedge amounts 52