#1Scotiabank Investor Presentation March 2, 1999#2Performance highlights • net income up 11% year over year strong revenue growth - up 18% year over year improved productivity at 58.3% • stable asset quality • $150MM added to general provisions improving capital ratios Scotiabank 1#3Consistent record of earnings growth EPS, cents 90 60 30 0 * '94 & '97 excludes unusual items 1994 Scotiabank 69¢ 1995 1996 1997 1998 Q199 2#4On target to meet key goals Q1/99 Target ROE 14.8% VS. 14%+ EPS growth 11% VS. 10% Productivity 58.3% * VS. <60% Tier 1 7.2% VS. 7% * 56.1% including large security gain Scotiabank 3#5Strong year-over-year growth $ millions Q1/99 vs Q1/99 Q1/98 Q1/99 vs Q4/98 Net interest income (TEB) 1,218 16 % 3 % Other income 807 23 17 Total revenues 2,025 18 % 8% Provision for credit losses 259 100+ 100+ Non-interest expenses 1,136 11 (1) Taxes/other 262 13 5 Net income 368 11 % 3 % Scotiabank 4#6Improvement in productivity Revenues to Expenses 65 benchmark 60 55 55 * Q4/97 &Q1/99 exclude unusual items 95 96 Scotiabank LO 58.3%* 97 98 Q1/99#7Stability through diversification % of net income, average 1995-Q1 1999* * Investment Asia & Latin America 7% 17% Caribbean Retail & 11% Commercial 52% excludes Executive Office Scotiabank Domestic 41% CO 6 Corporate 24%#8Increase in Reserves $ billions $1.0 1 Market Surplus 0.5 0 Q4/98 Scotiabank 7 Q1/99 General Reserves#9Domestic#10Domestic Retail & Commercial-up vs. Q4 150 100 50 Net income, $MM 0 Q1/98 Q4/98 Q1/99 Scotiabank 8 strong mortgage growth broad-based increases in fee income personal deposits ➤increase in market share#111999 Domestic focus • reap benefits from acquisitions • customer vs. product focus ➤increase number & training of sales staff ➤leverage MIS • reduce costs & improve service ➤implement new banking platform ➤aggressively expand alternate delivery channels improve share of wealth management business Scotiabank 9#12National Trust integration going well 3.2 MM BNS households 600M NT households systems fully integrated all branches converted by May '99 strong customer retention • accretive to earnings Scotiabank 10#13Improving skills/training of sales force 8000 6000 4000 2000 0 1996 97 Scotiabank 11 1998 Registered Sales Force # enrolled in Financial Planning#14Significant growth in self service transactions 400 mm transactions 300 -15% 200 -17% 100 0 Branch Counter Scotiabank Cheques 1996 1997 1998 12 +94% Total self service#15Aggressively expanding telephone & Internet banking 16 mm transactions 12 8 4 0 1997 1998 TeleScotia Internet Banking Scotiabank 13#16Increasing Wealth Management share Scotiatrust Assets under Administration = $75B Scotiabank branches Seamless delivery Scotia Mutual Funds Scotiabank Scotia Discount Brokerage 14 ScotiaMcLeod Scotia Cassels#17Empty#18International#19International - a base for future growth 150 Net income, $MM 100 50 0 Q1 Q4 Q1 Scotiabank 16 Caribbean - continued strong performance timing of PDI past due interest#201999 International focus capitalize on comparative strengths ➤implement cost control, risk management culture ➤leverage international experience & global network execute well ➤Scotia people on ground >training local staff - credit, operations limit capital in any one country diversify risk Scotiabank 17#21Caribbean - continue to grow strong franchise Net income, $MM 150 100 50 0 93 94 95 96 97 98 Scotiabank 18 consistent growth in earnings stable, repeatable ⚫ credit risk lower over 10 years than Canada dominant market presence ➤220 branches ➤6000 staff ➤$13B in assets#22Mexico: excellent progress with Inverlat Inverlat Key facts 413 branches • 675 ABMs $8 bn in assets Scotiabank Turnaround underway on full US GAAP improving credit processes major strides on workouts and costs ➤ staffing down from 10,600 to 8000 upgrading branches, systems 25 new branches in 1998 ➤ over 1,000 staff trained 19#23Corporate & Investment#24Corporate Banking - continued strong results 200 150 100 50 Net income, $MM Q1 - gain on sale of shares of $77MM (pre-tax) 0 Q1/98 Q4/98 Q1/99 Scotiabank 20 strong performance in US, Canada & Europe >higher volumes & spreads Real Estate - continuing recoveries#25Investment Banking - rebound from Q4 150 Net income, $MM more normal trading revenues 100 50 0 Q1/98 Q4/98 Q1/99 Scotiabank 21 • underwriting & brokerage up over Q4 continuing investment gains#261999 Corporate & Investment Banking focus integrate Corporate Banking & Scotia Capital Markets enhance individual account profitability - ROE focus manage down risk assets ⚫ cost reduction Scotiabank 22#27Risk Management#28Risk management summary lower specific credit losses for 1999 $150MM added to General Provisions • net impaired loans trending down • Asia & Latin America portfolio stable Scotiabank 23#29Steadily improving net impaired loans 2 1.5 net impaired loans as a % of loans & acceptances 1 0.5 0 94 95 96 97 98 Q1/99 Scotiabank 24 0.2#30Asian exposure - mainly top names Trade/Interbank/Gov't Sec US1.6b Other Total Asian Tigers 27% Hong Kong 7% Japan 34% Scotiabank 25 2.4b = US4.0b Korea 21% Other 11%#31Latin America - mainly Bradys & trade Scotiabank Cross-border = US $3.7b Loans 31% Investment in affiliates 12% Trade & Bradys 57% 26#32Capital#33Capital ratios - steady improvement % of risk-adjusted assets 12 10.6 10.6 10.4 10 8.9 8 Total 7.2 7.2 Tier 1 6.9 CO 6 6.7 4 6.0 5.5 6.1 Common 5.8 2 0 1996 1997 1998 Q1 1999 Scotiabank 27#34Capital - objectives continued strong internal generation of capital ➤over $1 billion annually in past 2 years aggressively manage down risk assets optimize capital utilization • overall continue to strengthen capital ratios - Scotiabank 28#35Summary#361999 objectives by business line Domestic ➤grow earnings through NT integration, cost reduction programs, sales initiatives International > reduce cross border risks >continue improvements in affiliates (credit culture, cost reductions, training) Corporate & Investment ➤priority is integration of operations >focus on reducing risk-asset levels, pricing & ROE discipline Scotiabank 29#37Key objectives for 1999 • continue consistent earnings growth • focus on cost control improve asset quality • build reserves strengthen capital ratios ➤optimize use of capital Scotiabank 30 30#38This presentation includes forward-looking statements about objectives, strategies, and expected financial results to assist investors and others in assessing The Bank of Nova Scotia's prospective financial condition and results. Such forward- looking statements are inherently subject to uncertainties beyond the Bank's control, including but not limited to economic and financial conditions globally, regulatory developments in Canada and elsewhere, technological developments, and competition. The reader is cautioned that the Bank's actual performance could differ materially from such forward-looking statements. Scotiabank 31