Investor Presentation Q4 2005

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November 29, 2005

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#1Scotiabank Investor Presentation Fourth Quarter, 2005 November 29, 2005 1 Scotiabank This document includes forward-looking statements which are made pursuant to the "safe harbour" provisions of the United States Private Securities Litigation Reform Act of 1995. These statements 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. Forward-looking 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. The Bank cautions readers not to place undue reliance on these statements, as a number of important factors 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; the effect of changes in monetary policy; legislative and regulatory developments in Canada and elsewhere; 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, tions, including uncertainties associated with critical accounting assumptions and estimates; the effect of applying future accounting changes; global parties to on third provide components of the Bank's business infrastructure; unexpected changes in consumer spending and saving habits; technological developments; consolidation in the Canadian financial services sector; changes in tax laws; competition, both from new entrants and established consonation competitors; judicial and regulatory proceedings; acts of God, such as earthquakes; 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 tratation communication, power and water; and the Bank's anticipation of and success in managing the risks implied by the A substantial amount of the Bank's business involves capital markets activity; the the Bank's s ability to attract and retain key executives; reliance ance on of the 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 54 in the Management's Discussion & Analysis section of the Bank's 2004 Annual Report. The Bank cautions that the foregoing 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 foregoing 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 behalf of the Bank. 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 Overview Rick Waugh President & Chief Executive Officer 3 Scotiabank 2005- record results 2005 Results (vs. 2004) ■ EPS: $3.15 - up 12% ■ ROE: 20.9% vs. 19.9% ■ Provision for credit losses: $230 mm vs. $390 mm Q4/05 Results (vs. Q4/04) ■ EPS: $0.80 - up 16% ■ ROE: 20.5% vs. 18.8% Strong Capital Ratios ■ TCE: 9.3% Another Dividend Increase ■ +2 cents to 36 cents/quarter effective Q1/06 4#3Scotiabank Strong growth across business lines net income available to common shareholders, $ millions +13% 1,253 1,105 2004 2005 +12% 915 +12% 819 800 718 Domestic Scotia Capital International 5 Scotiabank A record of consistent earnings growth net income, $ millions. 804 10-Year CAGR: 15% 95 96 97 98 99 00 01 02* * before charges related to Argentina 6 03 60 3,209 04 95 05#4Scotiabank and a record of consistent dividend growth with two increases this year Annual dividend, cents/share 32.5¢ 1996 1998 * based on current rate Scotiabank $1.44* 2005 increase: 20% 2000 2002 2004 2006 7 Exceeded our 2005 performance targets ROE 2005 Target 20.9% VS. 17-20% EPS Growth 12% VS. 5-10% Productivity 56.3% VS. <58% 8#5Scotiabank Scotiabank $ millions Performance Review Luc Vanneste Executive Vice-President & Chief Financial Officer 9 Underlying revenue growth in 2005 Change 2005 $ % Reported 10,400 379 4 Impact of Stronger Canadian dollar 287 287 Underlying 10,687 666 7 Net Interest Income 6,035 334 6 Other Income 4,652 332 10 00#6Scotiabank Strong underlying asset growth average assets, $ billions Domestic Banking International Banking Scotia Capital 112 2004 123 2005 * before impact of foreign currency translation Scotiabank 49 115 109 53 2004 2005* 2004 2005* 11 Margin unchanged on the quarter Q4/05 vs. Q3/05 2005 vs. 2004 1.97% Net interest margin 2.00% (10) bps Due to: 1 Canadian currency (10) (1) Foreign currency 12#7Scotiabank 5 millions Q4/Q3 Solid growth in other income Q4/Q4 2005 / 2004 44 178 Underlying 332 8% (18) (20) Impact of stronger Canadian $ (123) 26 158 Reported 209 5% (7) 8 Trading Revenues 118 13 40 Retail Brokerage 92 (3) 20 Deposit & Payment services 55 9 27 Investment Banking 32 2 8 Mutual Funds 22 1 8 Card Revenues 20 (9) 222 (7) Securitization Revenues (32) (12) Credit Fees (41) 55 Securities Gains (63) 22 11 Other 6 26 158 Reported 209 5% 13 Scotiabank 6 millions Q4/Q3 66 Higher expenses Q4/Q4 2005/2004 106 Underlying 228 4% (20) (20) Impact of stronger Canadian $ (95) 16 32 Impact of new subsidiaries 48 62 118 Reported 181 21 28 Salaries 30 (24) 1 Performance-based compensation 29 11 7 Professional Expenses 23 22 Advertising & Business Development 13222 3% 14 9 Premises & Technology (1) Communications 7 (8) (2) Business & Capital taxes 5 (10) 3 Pension & employee benefits (23) 35 51 Other 79 62 118 Reported 181 3% 14#8Scotiabank 60 55 59 50 Maintaining strong productivity expenses as % of revenues Scotiabank 12 10 99 99 56.3 00 00 01 02 80 03 04 05 50 15 Continued strong capital ratios % of risk-adjusted assets 11.5 11.1 11.1 Tier 1 8 9.7 9.3 9.3 Tangible Common 6 Equity 4 2 ○ Q4/04 Q3/05 Q4/05 16#9Scotiabank High level of unrealized securities' gains $ millions Scotiabank Q4/05 Q3/05 Q4/04 Emerging Market Debt 574 579 507 - Fixed Income (38) 1 39 - Equities 499 504 502 1,035 1,084 1,048 17 Business Line Results 18#10Year-over-year growth across all businesses Scotiabank net income available to common shareholders, $ millions Q4/05 Q3/05 Q4/04 Domestic 326 319 248 International 174 234 159 Scotia Capital 229 200 237 Other 74 22 22 57 Total 803 775 701 19 Scotiabank Domestic Banking - strong performance $ millions % Net income* ROE Net income of $326 million 350 50 45 - up 31% yr/yr, 2% qtr/qtr 300 40 250 35 ■ ROE of 30.1% 30 200 25 Revenues up 10% yr/yr, 3% qtr/qtr 150 20 15 100 Expenses: moderate increase 10 50 5 Credit quality remains strong 0 0 Q4/04 Q3/05 Q4/05 * net income available to common shareholders 20#11Scotiabank $ millions Domestic - continued strong retail asset growth Year/Year Net-interest income Non-interest income ◉ 1,400 1,200 1,000 800 600 400 200 Revenues up 10% ◉ Strong retail asset growth ■ Margin compression Higher fees in several areas: -retail brokerage mutual funds card revenues Quarter/Quarter 0 ◉ Revenues up 3% Q4/04 Q3/05 Q4/05 21 Higher brokerage and mutual fund fees Scotiabank International - good underlying growth impacted by forex $ millions Net income of $174 million % Net income* -ROE 250 40 35 200 150 100 50 50 30 25 20 ◉ 15 10 up 10% yr/yr, down 25% qtr/qtr up 17% yr/yr, ex. forex translation Expenses up 22% yr/yr, 9% qtr/qtr Banco de Comercio acquisition Inverlat: higher marketing expenses & performance-based compensation Caribbean & Central America strong retail asset growth lower loan losses 5 Latin America 0 0 Q4/04 Q3/05 Q4/05 * net income available to common shareholders 22 strong revenue growth yr/yr solid results at Scotiabank Inverlat#12Scotiabank Inverlat - another good quarter, Scotiabank contribution, $ millions higher expenses 100 75 50 25 T T 0 Q4/04 Q3/05 Q4/05 ■ Contribution of $86 million - up 4% yr/yr ■ ROE of 24% ☐ ☐ Underlying revenues up 21% yr/yr - growth in retail & commercial lending - higher margins and retail banking fees Higher expenses - advertising and promotion - performance-based compensation 23 Scotiabank $ millions - Scotia Capital – higher revenues, lower loan loss recoveries vs. Q4/04 ◉ Net income of $229 million % Net income* -ROE 250 50 45 200 40 ◉ 35 150 30 25 100 20 " 15 50 10 5 ◉ 0 0 Q4/04 Q3/05 Q4/05 down 3% yr/yr, up 15% qtr/qtr ◉ ROE of 27.4% Revenue up 11% yr/yr, 4% qtr/qtr Scotia Waterous contribution strong growth in derivatives Expenses down 2% yr/yr, 7% qtr/qtr lower salaries and performance- based compensation Lower loan loss recoveries yr/yr net recovery of $7 million vs. net recovery of $25 million in Q4/04 * net income available to common shareholders 24#13Scotiabank $ millions Other 75 Net income* Net income of $74 million up $17 mm yr/yr, $52 mm qtr/qtr 50 25 0 Q4/04 Q3/05 Q4/05 " Higher investment gains yr/yr " Q4/05 includes $45 million release of general allowance * net income available to common shareholders 25 ด Scotiabank Risk Review Brian Porter Chief Risk Officer 26 26#14Scotiabank Credit risk overview ■ Lower specific provisions: - 2005: $275 mm - down $215 mm vs. 2004 - Q4/05: $81 mm - down $4 mm vs. Q3/05 ■ Lower net impaired loans: $681 mm (after specific allowance) ■ - down $198 mm vs. Q4/04 - up $108 mm vs. Q3/05 $45 mm release of general allowance in Q4/05 Scotiabank $ millions 27 Significant reduction in specific provisions in 2005 Q4/05 Q3/05 2005 2004 69 63 Domestic 274 317 16 21 International 70 70 Scotia Capital: (20) 1 - U.S. (93) 54 13 1 - Other 22 52 3 (1) Other 2 (3) 81 85 Total 275 490 28#15Scotiabank $ millions Positive trend in specific provisions – significant reduction in Scotia Capital 317 272 274 2003 2004 2005 549 73 70 70 10 106 (71) Domestic Banking International Banking Scotia Capital 29 Scotiabank $ millions Positive trend in impaired loans 3,241 1,522 2,200 879 Gross Impaired Loans Net Impaired Loans* 1,820 Q4/03 Q4/04 Q4/05 after specific allowance 30 681#16Net formations this quarter Scotiabank $ millions Domestic - Retail - Commercial International Scotia Capital - · Canada - U.S. - Europe Total 31 89 46 46 135 47 (6) (9) 72 57 Scotiabank Trading revenues, 2005 # days Trading revenues 95%+ days = positive SG N N A 10 15 20 30 25 35 40 239 5 0 (4) (3) (2) (1) 01 2 3 4 5 6 7 89 10 11 12 13 14 $ millions 32#17Scotiabank Moderate market risk $ millions, November 1, 2004 to October 31, 2005 20 10 -10 Actual P&L VAR 1 day -20 Average 1 day VAR = $7.6 mm 33 Scotiabank Risk summary Credit quality remains stable ■ Potential for further release of general allowance ■ Market risk remains well controlled 34#18Scotiabank Scotiabank Outlook Rick Waugh President & Chief Executive Officer 35 2006 key priorities 1. Sustainable revenue growth - retain and grow existing business - acquire new customers 2. Acquisitions 3. Effective capital management & allocation - maintain strength and flexibility 36#19Scotiabank Domestic Banking - 2006 key priorities ■ Grow existing customer base and acquire new customers - increase share of wallet and improve cross-sell - focus on emerging affluent investor segment new branches and new branch formats - targeted marketing initiatives and additional financial advisors ■ Focus on Wealth Management Restructure Commercial Banking Expand scale and increase revenues via strategic alliances and acquisitions 37 Scotiabank International Banking - 2006 key priorities ■ Pursue revenue growth opportunities - sales and service - expand sales and delivery network, product offerings ■ Continue to seek acquisitions in key markets - Caribbean, Central America, Latin America and Asia ■ Lower processing costs, take advantage of economies of scale - refine International Shared Services initiative 38#20Scotiabank Scotia Capital - 2006 key priorities ■ Global Corporate & Investment Banking - remain in top 3 position in products in Canada - acquisitions in niche sectors - continue to actively manage risk ■ Global Capital Markets - target growing client segments with new product offerings ■ Continue integration of Mexico wholesale business, creating NAFTA platform 39 2006 objectives Scotiabank ■ EPS growth: 5-10% ROE: 18-22% Productivity ratio - below 58% ■ Maintain strong capital ratios & credit ratings 40

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