#1Investor Presentation First Quarter 2019 Scotiabank®#2CAUTION 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 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 2018 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 (including those in the area of risk management), 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," "anticipate," "intent, "estimate," "plan," "may increase," "may fluctuate," and similar expressions of future or conditional verbs, such as "will," "may," "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 the Bank's control and the effects of which can be difficult to predict, 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 and funding; significant market volatility and interruptions; the failure of third parties to comply with their obligations to the Bank and its affiliates; changes in monetary policy; legislative and regulatory developments in Canada and elsewhere, including changes to, and interpretations of tax laws and risk-based capital guidelines and reporting instructions and liquidity regulatory guidance; changes to the Bank's credit ratings; operational (including technology) and infrastructure risks; 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; 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; critical accounting estimates and the effects of changes in accounting policies and methods used by the Bank as described in the Bank's annual financial statements (See "Controls and Accounting Policies - Critical accounting estimates" in the Bank's 2018 Annual Report) and updated by quarterly reports; 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; increasing cyber security risks which may include theft of assets, unauthorized access to sensitive information or operational disruption; anti-money laundering; consolidation in the financial services sector in Canada and globally; competition, both from new entrants and established competitors; judicial and regulatory proceedings; natural disasters, including, but not limited to, earthquakes and hurricanes, and disruptions to public infrastructure, such as transportation, communication, power or water supply; the possible impact of international conflicts and other developments, including terrorist activities and war; the effects of disease or illness on local, national or international economies; 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 "Risk Management" section of the Bank's 2018 Annual Report. Material economic assumptions underlying the forward-looking statements contained in this document are set out in the 2018 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. The preceding list of factors is not exhaustive of all possible risk factors and other factors could also adversely affect the Bank's results. 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 forward-looking statements contained in this document are presented for the purpose of assisting the holders of the Bank's securities and financial analysts in understanding the Bank's financial position and results of operations as at and for the periods ended on the dates presented, as well as the Bank's financial performance objectives, vision and strategic goals, 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. Scotiabank®#3TABLE OF CONTENTS Scotiabank Overview • . • Canada's International Bank Well-Diversified and Profitable Business Medium-Term Financial Objectives • Why Invest in Scotiabank? • Increasing Scale, Improving Focus • Track Record of Earnings and Dividend Growth • Strong Capital Generation and Position • Progress in Digital Banking • Corporate Social Responsibility Appendix 1: Business Line and Financial Overview • Q1 2019 Financial Performance . Canadian Banking • International Banking • Global Banking and Markets Credit Performance by Business Lines . Wholesale Funding Composition Appendix 2: Key Market Profiles Appendix 3: Canadian Housing Market Appendix 4: Additional Information Contact Information 5 LO CO 6 7 8 9 10 11 12 13 14 15 16 23 26 28 29 30 38 45 47 Scotiabank®#4Scotiabank Overview Scotiabank®#5Canada's International Bank Top 10 Bank in the Americas 1,2 Americas 7th largest bank by assets¹ 10th largest bank by market capitalization¹ Full-Service Canada Mexico Peru • Chile Colombia Caribbean Uruguay Wholesale Operations USA UK Hong Kong Singapore Australia Ireland China • Brazil South Korea Malaysia India • Japan 2018 Bank of the Year Latin America and the Caribbean by Latin Finance Europe FY Change Scotiabank 3 Q1 2019 Y/Y Revenue $7.6B +7% Net Income 4 $2.3B +4% Return on Equity 13.7% (260bps) Operating Leverage4 (4.3%) n.a. Productivity Ratio 54.1% 220bps4 Total Assets $1.0T 12.0% Ranking by Market Share 5 Canada #3 USMCA USA Top 10 Foreign Bank Asia Mexico #6 #4 PAC Peru Chile Colombia #3 in PAC #3 #5 35 1 Source: Bloomberg 2/24/19; 2 By assets and market capitalization; 3 Figures adjusted for Acquisition-related costs, including integration and amortization costs related to current acquisitions, and amortization of intangibles related to current and past acquisitions; 4 Exclude employee benefits re-measurement credit of $203MM pre-tax, $150MM after-tax in Q1/18; 5 Ranking based on market share in loans as of December 2018 for PACS, as of November 2018 in Canada for publically traded banks; 6 For the three months ended January 31, 2019; 7 Excluding Corporate adjustments LEADING BANK IN THE AMERICAS Earnings by Geography3.6.7 Other- C&CA 7% 9% PAC 26% 8% 50% Canada U.S.A Americas (>90%) Scotiabank® 15#6Well-Diversified and Profitable Business Diversified by business and by geography, creating stability and lowering risk. Earnings by Business 1,2,3 Earnings by Geography1,2,3 * Caribbean and Central America Canadian Wealth Management 10% Global Banking and Canadian Banking Markets P&C 15% EARNINGS MIX 39% $2.2B International Banking 36% Adjusted Return on Equity¹ by Division Canadian Banking 49% Colombia 2% C&CA* 9% Other 7% Chile 6% EARNINGS MIX Peru 10% Mexico $2.2B 8% U.S. 8% 18.4% 14.9% 13.7% 11.5% Canadian Banking International Banking Global Banking and All Bank Markets Canada 50% 1 For the three months ended January 31, 2019; 2 Adjusted for Acquisition-related costs, including integration and amortization costs related to current acquisitions, and amortization of intangibles related to current and past acquisitions 3 Excluding Corporate adjustments GREATER SCALE, GREATER FOCUS 6 Scotiabank®#7Medium-Term Financial Objectives1 METRICS ALL BANK OBJECTIVES Q1/19 RESULTS 2 (Y/Y Change) EPS Growth³ 7%+ ROE 14% + 13.7% Operating Leverage³ Positive (4.3%) Capital Strong Levels 11.1% Dividend Payout Ratio 40%-50% 48.5% BUSINESS LINE CANADIAN BANKING Net Income Growth Productivity Ratio 7% + (2%) <49% 50.0% INTERNATIONAL BANKING Net Income Growth 4 Productivity Ratio 9% + <51% +18% 51.1% 13-5 year objectives. 2Adjusted for Acquisition-related costs, including integration and amortization costs related to current acquisitions, and amortization of intangibles related to current and past acquisitions; 3 Exclude employee benefits re-measurement credit of $203MM pre-tax, $150MM after-tax in Q1/18; 4 On a constant dollar basis Scotiabank® 7#8Why Invest in Scotiabank? ☑ Canada's international bank and a top 10 bank in the Americas Diversified exposure to high quality growth markets Increasing scale and market share in key markets Improving quality of earnings. while reducing risk profile • • Unique footprint that provides sustainable and growing earnings and dividends Strong balance sheet, capital and liquidity ratios • Attractive dividend yield and long-term shareholder returns • Leading bank in the Pacific Alliance growth markets of Mexico, Peru, Chile and Colombia - a region of 230 million people with an under-banked market and a median age of 29 Earnings momentum in personal & commercial, wealth, and wholesale businesses Gaining market share in key markets of Canada and the Pacific Alliance countries Top 3 bank in Canada, Chile and Peru Increasing scale in Wealth and Pacific Alliance with $7B of strategic acquisitions in 2018 Approximately 80% of earnings from core personal and commercial banking businesses • Exited over 20 non-core countries and businesses since 2014 • Strong Canadian risk management culture - building stronger capabilities for AML, cyber and reputational risk Enhancing competitive advantage in technology and talent Leading levels of technology investment supports digital banking strategy. Increasing digital sales adoption with clear targets Well positioned in the Pacific Alliance to leverage technology, risk management and funding versus local and global competitors • Named to Top 25 "World's Best Workplaces" (2018) 8 Scotiabank®#9Increasing Scale, Improving Focus¹ Gaining scale in key markets to drive earnings growth, improve earnings quality and reduce risk Gaining Market Share (Total Loans) Canada 2013 2018 0 2 4 6 8 10 12 14 16 18 20 Increasing Scale with Strategic Acquisitions (2017-2019) MD Canada MD Financial Management Chile JARISLOWSKY FRASER GLOBAL INVESTMENT MANAGEMENT BBVA Increases wealth management assets to $230B. Adds 110,000 potential primary customers. Doubles market share. Creates 3rd largest bank. Mexico Chile Peru Colombia Improving Earnings Quality $ Increased wealth AUM by 37% to $282B in 2018. Targeting earnings contribution to All-Bank earnings from 12% to 15% 15-year period 2013-2018 INCREASING SCALE, IMPROVING FOCUS Peru banco cencosud Creates #2 bank in credit cards. Colombia Citibank Creates market leader in credit cards. Dominican Republic Doubles customer base. Creates 4th largest bank. PROGRESO... Reducing Risk Profile • 57 countries 37 countries 2013 2019 Between 2013 and 2019, exited 20 countries with either low returns, small scale or higher operational risk: Turkey Russia • Haiti ⚫ Egypt Taiwan UAE⚫ plus 14 others • Exited 5 non-core businesses Reduced wholesale funding (% of assets) from 29.6% to 23.9% • Reduced asset exposure in Asia by 21% Scotiabank® 9#10Strong Track Record of Earnings and Dividend Growth Stable and predictable earnings with steady increases in dividends Earnings per share (C$) 1.2 Total shareholder return³ $3.05 +9% CAGR $7.11 III Scotiabank Big 5 peers (ex. Scotiabank) 16.7% 14.4% 11.8% 12.0% 11.1% 8.6% 08 09 10 11 12 13 14 15 16 17 18 5 Year 10 Years 20 Years Dividend per share (C$) $1.92 08 09 +6% CAGR $3.28 10 11 12 13 14 15 16 17 18 1 Reflects adoption of IFRS in Fiscal 2011 2 Excludes notable items for years prior to 2016. For 2016 onwards, results adjusted for acquisition-related costs including Day 1 PCL impact on acquired performing loans, integration and amortization costs related to current acquisitions and amortization of intangibles related to current and past acquisitions. 3 As of January 31, 2019 INCREASING SCALE, IMPROVING FOCUS 10 Scotiabank®#11Strong Capital Generation and Position Capital levels are well above minimum regulatory requirements. CET1 >11%. CET1 Ratio 11.2% 11.1% 11.1% +28 bps -12 bps -9 bps -3 bps -4 bps +10 bps Q4/18 Internal Capital RWA Impact Generation Pensions Share Other Q1/19 Net Impact of Q1/19 Pro- (ex. FX) issuance / Including FX Announced Forma (buybacks) Acquisitions & (net) Divestitures Strong Capital Levels 14.6% 1.9% 1.5% 15.3% 14.5% 14.6% 14.3% 1.8% 1.7% 1.8% 2.1% 1.5% 1.4% 1.4% 1.4% 12.0% 11.2% 11.4% 11.1% 11.1% Q1/18 Q2/18 Q3/18 Q4/18 Q1/19 CET1 Tier 1 Tier 2 Scotiabank® 11#12Progress in Digital Banking Steady and continual increase in digital banking Digital Retail Sales1 +14% 15 11 Digital Adoption² +7% In-Branch Financial Transactions³ -8% 25 33 33 26 22 29 23 26 20 18 F2016 F2017 F2018 Q1/19 F2016 F2017 F2018 Q1/19 F2016 F2017 F2018 Q1/19 Goal >50% Goal >70% Goal <10% Strong progress made in all five key markets across various product suites including deposits, personal loans, insurance, etc. Adoption grew 400bps against Q1/18; stable compared to year end In-branch transactions continued to decline at a steady pace 1 Canada: F2017 22%, F2018 26%, Q1/19 28% 2 Canada: F2017 36%, F2018 38%, Q1/19 39% 3 Canada: F2017 17%, F2018 15%, Q1/19 13% PACS: F2017 13%, F2018 19%, Q1/19 24% PACS: F2017 20%, F2018 26%, Q1/19 27% PACS: F2017 29%, F2018 24%, Q1/19 22% Scotiabank® 12 12#13Environmental, Social & Governance Our Priorities KAI 590 Financial Knowledge Access to Finance Diversity and Inclusion Investing in Young People Responsible Financing Climate Change Maintaining Trust MEMBERSHIPS, ASSOCIATIONS & RECOGNITION MEMBER OF Dow Jones Sustainability Indices In Collaboration with RobecoSAM 900,000 Canadian students participated in Talk With Our Kids. About Money day in 2018 34% in women leadership positions (VP+) globally in 2018 Named as a Top 100 Company in 2018 by Thomson Reuters Diversity & Inclusion index Our Achievements $80 Million in donations globally in 2018 to support the communities we operate in Joint Lead Manager on $1 Billion World Bank Sustainable Development Bond to support women and youth Internal Carbon Price set at $15/tonne CO2 reinvested in energy efficiency initiatives Achieved recognition on the 2018 Dow Jones Sustainability Index North America SAM SAM Sustainability Award Sustainability Award Industry mover 2019 Bronze Class 2019 TCFD TASK FORCE ON CLIMATE-RELATED FINANCIAL DISCLOSURES CDP DRIVING SUSTAINABLE ECONOMIES GLOBAL THE GLA COMPA APAC United Nations Global Compact EQUATOR PRINCIPLES We have financial expertise 97,000+ employees Our Ability We have the reach 25 Million+ customers around the globe We have the resources $998 Billion in assets CP LC CARBON PRICING LEADERSHIP COALITION FINANCE UNEP INITIATIVE EURONEXT vigeqiris INDICES WORLD 120 Scotiabank® 13#14Appendix 1: Business Line and Financial Overview Scotiabank®#15Q1 2019 Financial Performance Strong revenue and balance sheet growth $MM, except EPS Reported Q1/19 Y/Y Q/Q Net Income $2,247 (4%) (1%) Diluted EPS $1.71 (8%) Revenue $7,604 +7% +2% Expenses $4,171 +19% +3% • Productivity Ratio 54.9% +550bps +30bps . YEAR-OVER-YEAR HIGHLIGHTS Adjusted Net Income down 3%2 Excluding pension revaluation benefit, diluted EPS was in-line with last year Revenue up 7% ○ Mostly relating to acquisitions Core Banking Margin 2.45% (1bp) (2bps) PCL Ratio 1 47bps +5bps +8bps ○ Net interest income up 9% PCL Ratio on Impaired Loans 1 47bps +4bps +5bps Adjusted² · Net Income $2,291 (3%) (2%) Diluted EPS $1.75 (6%) (1%) Expenses $4,110 +18% +4% Productivity Ratio 54.1% +500bps +80bps DIVIDENDS PER COMMON SHARE +0.03 +0.02 +0.03 ○ Non-interest income up 6% Expenses up 18% 2 o Acquisitions and the prior year's benefits re- measurement contributed to approximately two- thirds of the expense growth o Remaining growth due to technology, regulatory initiatives, share-based payments, other business growth expenses • PCL ratio¹ on impaired loans up 4 bps 0.85 0.85 0.82 0.82 0.79 Q1/18 Q2/18 Q3/18 Q4/18 Q1/19 ■ Announced Dividend Increase 1 Provision for credit losses on certain assets - loans, acceptances and off-balance sheet exposures 2 Adjusted for Acquisition-related costs, including integration and amortization costs related to current acquisitions, amortization of intangibles related to current and past acquisitions Scotiabank® 15#16Canadian Banking Top 3 bank in personal & commercial banking, wealth and insurance in Canada • Canadian Banking provides a full suite of financial advice and banking solutions, supported by an excellent customer experience, to Retail, Small Business, Commercial Banking, and Wealth Management customers Retail 56% REVENUE MIX1 $3.4B 18% Commercial Residential Mortgages 61% MEDIUM-TERM FINANCIAL OBJECTIVES Target² Q1/191,3,4 AVERAGE LOAN MIX 1 $342B Net Income Growth 5 7% + (2%) Productivity Ratio <49% 50.0% CB ex Wealth <45% 45.7% 26% Credit Cards 21% 16% Wealth <65% 63.4% Wealth Business and Government Loans Personal Loan New Primary Customers +1 MM +210,000 STRATEGIC OUTLOOK • Improved productivity towards our <49% productivity ratio target (<45% ex Wealth) by 2020 supported by higher revenue growth and mid-dingle digit expense growth. Integration of our recent acquisitions in Wealth: MD Financial Management ($49B AUM) and Jarislowsky Fraser ($40B AUM) Leverage data analytics for prudent growth in higher margin credit card and small business banking • Increase core deposits; increase primary customers towards our 1 million new primary customer goal 1 For the three months ended January 31, 2019; 2 3-5 year target; 3 Adjusted for Acquisition-related costs, including integration and amortization costs related to current acquisitions, amortization of intangibles related to current and past acquisitions and the Day 1 PCL impact on acquired performing loans in Q3/18; 4 Reflects adoption of new accounting standard, IFRS 15; 5Attributable to equity holders of the Bank Scotiabank® 16#17Canadian Banking Financial Performance Strong deposit growth and higher NIM FINANCIAL PERFORMANCE AND METRICS ($MM)¹ Q1/19 Y/Y Q/Q . Reported Revenue $3,415 +3% (1%) Expenses $1,730 +8% (1%) PCLs $233 +11% +18% Net Income $1,073 Productivity Ratio 50.6% (3%) +200bps (10bps) (4%) Net Interest Margin 2.44% +3bps (1bp) PCL Ratio² 0.27% +2bps +4bps PCL Ratio on Impaired Loans² Adjusted³ 0.27% +5bps Expenses $1,709 +7% Net Income $1,089 Productivity Ratio 50.0% (2%) +160bps (5%) +50bps ADJUSTED NET INCOME 13 ($MM) AND NIM (%) 2.41% 2.43% 2.46% 2.45% 2.44% 1,107 1,022 1,141 1,146 1,089 Q1/18 Q2/18 1 Attributable to equity holders of the Bank Q3/18 Q4/18 Q1/19 YEAR-OVER-YEAR HIGHLIGHTS Adjusted Net Income down 2%3 o Lower real estate gains and prior year Interac gain reduced net income by 4% Higher PCLs related to one commercial account o Includes the impact of acquisitions ○ Asset and deposit growth, margin expansion Revenue up 3% o Includes impact of acquisitions ○ Net interest income up 5% • Loan growth of 4% o Business loans up 10% o Residential mortgages up 3%; credit cards up 7% Deposit growth of 9% o Personal up 7%; Non-Personal up 12% NIM up 3 bps o Primarily driven by the impact of prior rate increases Expenses up 7%³ o Includes impact of acquisitions ○ Investments in technology and regulatory initiatives PCL ratio2 up 2 bps to 27 bps 2 Provision for credit losses on certain assets-loans, acceptances and off-balance sheet exposures 3 Adjusted for Acquisition-related costs, including integration and amortization costs related to current acquisitions, and amortization of intangibles related to current and past acquisitions Scotiabank® 17#18Canadian Banking: Retail Exposures High quality retail loan portfolio: ~93% secured • Residential mortgage portfolio is high quality ○ 42% insured, and the remaining 58% uninsured has a LTV of 55% 1 • Market leader in auto loans ○ $37 billion auto loan portfolio with 7 OEM relationships (3 exclusive) o Prime Auto and Leases (~91%) o Lending tenor has been relatively stable with contractual terms for new originations averaging 78 months with projected effective terms of 55 months • Growth opportunity in credit cards o $7.4 billion credit card portfolio represents ~3% of domestic retail loan book and 1.3% of the Bank's total loan book o Organic growth strategy focused on payments and deepening customer relationships 。 Upside potential from existing customers: ~80% of growth is from existing customers (penetration rate mid-30s and trending up versus peers in the low-40s) Strong risk management culture with specialized credit card teams, customer analytics and collections focus 5% Unsecured DOMESTIC RETAIL LOAN BOOK $287.4B 3% Credit Cards 1 LTV calculated based on the total outstanding balance secured by the property. Property values indexed using Teranet HPI data. 79% Real Estate Secured Lending -13% Automotive Scotiabank® 18#19Canadian Banking: Residential Mortgages High quality, diversified portfolio • Residential mortgage portfolio of $216 billion: 42% insured; LTV 55% on the uninsured book¹ ○ Mortgage business model is "originate to hold" ○ New originations 2 had average LTV of 64% in Q1/19 ○ Majority is freehold properties; condominiums represent approximately 13% of the portfolio • Three distinct distribution channels: All adjudicated under the same standards o 1. Broker (~59%); 2. Branch (~20%); and 3. Mobile Salesforce (~21%) CANADIAN MORTGAGE PORTFOLIO: $216B (SPOT BALANCES AS AT Q1/19, $B) Freehold $188B Condos $28B $109.2 42% Insured $12.6 $96.6 $39.2 $9.5 $30.8 $3.6 $16.0 $29.8 $27.2 $1.8 $14.2 $11.3 $11.1 $9.5 $0.2 Ontario BC & Territories Alberta Quebec Atlantic Provinces % of 50.5% 18.1% 14.3% 7.4% 5.3% $8.8 - $0.7 Manitoba & Saskatchewan 4.4% portfolio 1LTV calculated based on the total outstanding balance secured by the property. Property values indexed using Teranet HPI data 2 New originations defined as newly originated uninsured residential mortgages and have equity lines of credit, which include mortgages for purchases refinances with a request for additional funds and transfer from other financial institutions Total Portfolio: $216 billion 58% Uninsured Scotiabank® 19#20Canadian Banking: Residential Mortgages (continued) High quality portfolio, lower originations in Vancouver and Toronto NEW ORIGINATIONS UNINSURED LTV* DISTRIBUTION GVA 59% BC & Territories 61% GTA 63% Q1/18 Q4/18 Q1/19 Growth/Change Y/Y Canada Total Originations ($B) 10.3 Uninsured LTV 10.5 9.3 -10% 64% 63% 64% GTA Total Originations ($B) Uninsured LTV 3.4 3.2 3.2 -6% 63% 62% 63% Prairies 67% ON QC 64% 66% Atlantic Provinces 68% GVA Total Originations ($B) 1.5 Uninsured LTV 62% 1.1 59% 1 -33% 59% -3% *Average LTV ratios for our uninsured residential mortgages originated during the quarter FICO® DISTRIBUTION - CANADIAN UNINSURED PORTFOLIO1 Average FICO Score Canada 787 GTA 789 GVA 791 16% 12% 12% 4% < 635 636-706 707-747 FICO is a registered trademark of Fair Isaac Corporation 1 FICO distribution for Canadian uninsured portfolio based on score ranges at origination 56% . 748-788 > 788 • <0.70% of uninsured portfolio has a FICO® score of <620 and an LTV >65% Canadian uninsured mortgage portfolio is $124 billion as at Q1/2019 Scotiabank® 20 20#21Automotive Finance Canada's leader in automotive finance • Provide personal and commercial dealer financing solutions, in partnership with seven leading global automotive manufacturers in Canada • Portfolio grew 2% 1 year-over-year Personal up 4%, Commercial down 7% Commercial 12% Exclusive Relationships MAZDA VOLVO JAGUAR LANDROVER AVERAGE Near-Prime Retail 8% ASSET MIX $42.1B1 Semi-Exclusive Relationships* 80% 100% Secured HYUNDAI CHRYSLER GM TESLA Prime Retail 1 to 2 other financial institutions comprise Semi-Exclusive relationships Market Share² Prime Retail Market Share³ 63% 37% Near-Prime Retail Market Share4 71% 29% Commercial Floorplan Market Share5 71% 29% 1 For the three months ended January 31, 2019; 2 Data as at Oct 2018; 3 CBA data, includes BMO, CIBC, HSBC, National Bank, RBC, Scotiabank, TD; DealerTrack Portal data, includes all Near-Prime Retail providers on DealerTrack Portal; 5 Includes BMO, CIBC, RBC, Scotiabank, TD, HSBC, Canadian Western Bank, Laurentian Bank 6 based on IFRS 9; 7 Provision for credit losses on certain assets-loans, acceptances and off-balance sheet exposures Scotiabank® 21#22Tangerine Canada's #1 Digital Bank Tangerine Forward Banking Industry-leading customer service (NPS) ⚫ 97% digital transactions • 96% digital on-boarding • 90% digital sales Conscious Self-Directed Tech-Friendly ~50% multiple-product clients Primary clients +18% Y/Y STRATEGIC FOCUS: • Simplicity Simple, market-leading products that appeal to value- conscious and tech-savvy Canadians Seamless digital client experience Highly competitive rates, simple products Velocity Enhanced self-service options, adding speed & agility • Nimble, modern platform supporting rapid development cycles • Low cost, scalable business model Partnerships • Accelerating momentum through the Toronto Raptors ~50% New Clients via Referrals • Deepening client relationships by introducing SCENE Loyalty . Strong partnership with Scotiabank Modern Platform 90 Scalable: Nimble, low cost systems provide a holistic client view. Speed & Agility Client-Driven Innovation Unique 'Orange' Culture Award Winning Approach Rapid Deployments: Agile best practices enable quick & efficient new product & feature delivery. Incubator: Identify, explore, and pilot new technologies and solutions to meet evolving Client needs. > Team Tangerine: Our unique culture and lean team are an essential part of how we deliver. Third-Party Recognition: J.D. Power Customer Satisfaction seven years in a row, Finovate "Best in Class" for digital experiences. Scotiabank® 22#23International Banking Leading diversified personal and commercial franchise in high quality growth markets • International Banking operates primarily in Latin America, the Caribbean and Central America with a full range of personal and commercial financial services, as well as wealth products and solutions Asia 25% C&CA 4% REVENUE 1 $3.3B 7% Other Business 51% Loans MEDIUM-TERM FINANCIAL OBJECTIVES 71% Credit Cards 6% LOAN MIX1 $149B Latin America 24% Mexico Latin America 18% Colombia Target² Q1/193,4 Net Income Growth 5 9% + 18% 16% Personal 27% 25% Loans Peru Productivity Ratio <51% 51.1% Residential Mortgages Operating Leverage Positive +4.2% 26% Chile • • STRATEGIC OUTLOOK Integration of acquisitions in Chile and Colombia. Close announced acquisitions in Peru and Dominican Republic Closing of dispositions of non-core operations in smaller Caribbean markets, Dominican Republic and El Salvador Margins (NIM ~450 bps) and credit quality are expected to remain stable with the level in Q1/19 • Maintain positive operating leverage 1 For the 3 months ended January 31, 2019; 2 3-5 year target; 3 Adjusted for Acquisition-related costs, including integration and amortization costs related to current acquisitions, amortization of intangibles related to current and past acquisitions; 4 Y/Y growth rates (%) are on a constant $ basis; "Attributable to equity holders of the Bank Scotiabank® 23#24International Banking Financial Performance Strong performance across the Pacific Alliance YEAR-OVER-YEAR HIGHLIGHTS2 FINANCIAL PERFORMANCE AND METRICS ($MM) 1 1, 2 Q1/19 Y/Y Q/Q • Reported Revenue $3,331 +22% +6% Expenses $1,742 +20% +1% PCLS $470 +37% +14% Net Income $782 +16% +10% Productivity Ratio 52.3% (100bps) (260bps) Net Interest Margin 4.52% (14bps) PCL Ratio 3 PCL Ratio on Impaired Loans³ 1.28% +2bps +23bps 1.23% (2bps) +3bps Adjusted5 Expenses $1,702 Net Income $805 Productivity Ratio 51.1% +18% +18% +2% +8% (180bps) (190bps) ADJUSTED NET INCOME 1,5 ($MM) AND NIM 5 (%) 4.66% 4.74% 4.70% 4.52% • 4.52% • 805 683 715 746 675 Q1/18 Q2/18 1 Attributable to equity holders of the Bank Q3/18 Q4/18 Q1/19 2 Y/Y and Q/Q growth rates (%) are on a constant dollars basis, while metrics and change in bps are on a reported basis • Adjusted Net Income up 18%5 o Includes impact from alignment of reporting period in Peru which contributed 6% Strong asset and deposit growth across the Pacific Alliance Revenues up 22% o Includes impact of acquisitions o Pacific Alliance up 31% includes impact of acquisitions Loans up 29% o Pacific Alliance up 44% includes impact of Chile and Colombia acquisitions NIM down 14 bps o Driven by the business mix impact of acquisitions (BBVA Chile) Expenses up 18%5 o Includes impact of acquisitions Business volume growth and inflation 。 Productivity ratio improvement of 180bps 5 Positive operating leverage of 4.2%5 • PCLS ratio reflects stable credit quality 3 Provision for credit losses on certain assets - loans, acceptances and off-balance sheet exposures 4 Net Interest Margin is on a reported basis 5 Adjusted for Acquisition-related costs, including integration and amortization costs related to current acquisitions, and amortization of intangibles related to current and past acquisitions Scotiabank® 24#25Scotiabank in the Pacific Alliance Countries Well positioned for long-term growth in large, growing market Population 1,2 Government Presidential Elections Financial Stability Economy GDP1 Exports5 Trade Partners 5 Business Environment HDI Score Rank 6 Banking Penetration1 Foreign Direct Investment¹ Highlights of Pacific Alliance countries (PACs) •230 million. 6.2x Canada's population. Superior growth versus other EM³ and G7 countries; median age 4 of 29 No elections scheduled until 2021 All sovereign credit ratings in IG category with central banks' policy targeting inflation since 1999 ⚫9th largest economy in the world • 64% of exports related to manufacturing • US, China and Canada are the PACs' largest trading partners, representing 72% of exports Rank "High" or "Very High" (United Nations, 2017) Under-banked with average banking penetration at ~50% compared to over 90% in Canada and the U.S. FDI averaging 3.2% of GDP compared to 1.7% in Canada and the U.S. Scotiabank Market Share7 Market Share Ranking? Strengths Mexico 7.1% 6th Peru 17.7% 3rd Chile 14.0% 3rd Colombia 6.2% 5th PACS (Total/Average) 11.5% 4th Auto and mortgages P&C and Mortgages P&C and Mortgages Credit Cards, Personal Broad P&C platform Average Total Loans³ (C$B) $28 $21 $46 $12 $106 Revenue (C$B) $0.6 $0.6 $0.6 $0.4 $2.2 Net Income after NC 19,10 (C$MM) $182 $212 $135 $39 $567 ROE 9,10 25% 28% 9% 10% 16% # of Employees 11,12 13,214 11,080 9,257 9,689 43,240 1 Source: World Bank 2017 2 Population growth: World Bank Data Bank 2017-2022 3 EM countries include: Argentina, Brazil, China, Greece, India, Indonesia, Poland, South Africa, Turkey, and Russia 4 Source: The World Factbook, CIA 2017 5 Source: United Nation Conference on Trade and Development (UNCTAD) 2017; Organization for Economic Co- operation and Development (OECD) 2016 6 Human Development Index. Source: United Nations Development Programme (UNDP) 2017. For more information, please refer to: http://hdr.undp.org/sites/default/files/2018_human_development statistical_update.pdf 7 Ranking based on publicly traded banks by total loans market share as of December 2018 8 Average loan balances over Q1/19 9. For the quarter ended January 31, 2019 10 Earnings adjusted for acquisition-related costs including integration and amortization costs related to current acquisitions, and amortization of intangibles related to current and past acquisitions 11 Employees are reported on a full-time equivalent basis 12 As of January 31, 2019 Scotiabank® 25#26Global Banking and Markets Second-largest Canadian wholesale banking and capital markets business serving global clients ⚫ Full-service wholesale bank in Canada, the United States and Latin America. Offers a range of products and services in select markets in Europe, Asia and Australia. Asia 6% Canada Europe 10% GEOGRAPHIC REVENUE 1 $1.1B 42% US 42% Global Equities 16% Business Banking REVENUE BY BUSINESS LINE1 24% FICC $1.1B 60% Equities 34% Other 10% 14% TRADING RELATED REVENUE (TEB) 1,2 $479MM Commodities 24% 18% Foreign Exchange Interest Rate & Credit STRATEGIC OUTLOOK Up-tiering lending relationships, expanding our Investment Banking capabilities in key markets, increasing our investment in the Pacific Alliance to become a leader in local and cross-border banking and capital markets • Continued strong growth in deposits, improved corporate lending and investment banking results to absorb required regulatory and technology investments For the 3 months ended January 31, 2019; 2 All-Bank trading-related revenue Scotiabank® 26#27Global Banking and Markets Financial Performance Market volatility negatively impacted results FINANCIAL PERFORMANCE AND METRICS 1 ($MM) Q1/19 Y/Y Q/Q • Revenue $1,075 (10%) • Expenses $645 +13% +17% PCLS ($16) N/A N/A Net Income $335 (26%) (20%) Productivity Ratio Net Interest Margin 60.0% 1.80% (23bps) +1200bps +850bps +8bps PCL Ratio 2 (0.07%) (3bps) +2bps PCL Ratio on Impaired Loans² (0.01%) +6bps NET INCOME AND ROE 16.2% 16.9% 15.6% 15.3% 11.5% 447 441 454 416 335 Q1/18 Q2/18 Q3/18 Q4/18 Q1/19 1 Attributable to equity holders of the Bank 2 Provision for credit losses on certain assets-loans, acceptances and off-balance sheet exposures YEAR-OVER-YEAR HIGHLIGHTS • Reported Net Income down 26% Revenue down 10% ○ Non-interest revenue down by 12% due to lower fixed income trading, partly offset by higher equity trading and fee income NIM down 23 bps ○ Mainly driven by lower lending margins and loan origination fees Loans up 15% ○ Strong corporate growth across Canada and the U.S. Expenses up 13% o Higher regulatory and technology investments • PCL ratio² improved by 3 bps to (7 bps) o Improving credit quality in oil and gas portfolio Scotiabank® 27#28Credit Performance by Business Lines Stable underlying credit Q1/18 Q2/18 Q3/18 Q4/18 Q1/19 (As a % of PCLs on Total Average Net Loans & Impaired PCLs Acceptance) Loans PCLs on Impaired Loans Total PCLs PCLs on Total PCLs on Impaired PCLs Impaired Loans (adj) Loans PCLs on Total Total Impaired PCLs PCLS Loans Canadian Banking Retail 0.29 0.28 0.28 0.28 0.25 0.24 0.25 0.25 0.28 0.28 Commercial 0.11 0.08 0.09 0.09 (0.04) 0.06 0.06 0.15 0.21 0.23 Total 0.27 0.25 0.25 0.25 0.21 0.21 0.22 0.23 0.27 0.27 International Banking Retail 2.28 2.39 2.26 2.16 2.36 2.253 2.38 2.21 2.33 2.36 Commercial 0.28 0.201 0.55 0.341 0.38 0.311,3 0.07 (0.06) 0.19 0.26 Total 1.252 1.261.2 1.382 1.221.2 1.33 1.234 1.20 1.05 1.23 1.28 Global Banking and Markets (0.01) (0.04) 0.02 (0.05) (0.06) (0.05) (0.07) (0.09) (0.01) (0.07) All Bank 0.43 0.42 0.46 0.42 0.41 0.40 0.42 0.39 0.47 0.47 1 Excludes provision for credit losses on debt securities and deposit with banks 2 Not comparable to prior periods, which were net of acquisition benefits 3 On an adjusted basis; adjusted for Day 1 PCLs from acquisitions Scotiabank® 28#29Wholesale Funding Wholesale funding diversity by instrument and maturity 1,6,7 34% Senior Notes 1% Bail-inable Notes Asset-Backed Commercial Paper³ 3% 34% Bearer Deposit Notes, Commercial Paper & Short-Term Certificate of Deposits MATURITY TABLE (EX-SUB DEBT) (CANADIAN DOLLAR EQUIVALENT, $B) 2% Asset-Backed Securities $26 $24 $23 $4 12% $4 $19 $3 $11 $17 $3 $2 Covered Bonds $247B $1 9% $11 $21 Mortgage Securitization4 4% $17 $6 $15 $15 $12 $5 1% Subordinated Debt5 Deposits from Banks2 < 1 Year 2 Years 3 Years 4 Years 5 Years 5 Years > Senior Debt ABS Covered Bonds 1 Excludes repo transactions and bankers acceptances, which are disclosed in the contractual maturities table in the MD&A of the Interim Consolidated Financial Statements. Amounts are based on remaining term to maturity. 2 Only includes commercial bank deposits raised by Group Treasury. 3 Excludes asset-backed commercial paper (ABCP) issued by certain ABCP conduits that are not consolidated for financial reporting purposes. 4 Represents residential mortgages funded through Canadian Federal Government agency sponsored programs. Funding accessed through such programs does not impact the funding capacity of the Bank in its own name. 5 Although subordinated debentures are a component of regulatory capital, they are included in this table in accordance with ED TF recommended disclosures. 6 As per Wholesale Funding Sources Table in MD&A, as of Q1/19. 7 May not add to 100% due to rounding.. Scotiabank® 29 29#30Appendix 2: Key Market Profiles Scotiabank®#31Economic Outlook in Key Markets Growth in Pacific Alliance expected to remain above that of Canada and the U.S. 2018 AND 2019 REAL GDP GROWTH FORECAST (%) Real GDP (Annual % Change) Country 2000-17 avg. 2018e 2019f 2020f Mexico 2.2 2.0 1.4 1.3 Peru 5.0 3.6 4.0 4.0 Chile 3.9 4.2 3.2 3.2 Colombia 3.9 2.6 3.4 3.8 PACS simple avg. 3.8 3.1 3.0 3.1 2000-17 avg. 2018e 2019f 2020f Canada 2.1 2.0 1.8 2.0 U.S. 2.0 2.9 2.4 1.7 Source: Scotiabank Economics. Forecasts as of February 7, 2019. Scotiabank® 31#32Focused on the Pacific Alliance Attractive growth opportunity for Scotiabank Pacific Alliance o Portfolio of high quality growth markets for Scotiabank О 230 million people with median age of 29 O Largest trading partner is the United States (64% of exports) О Largest sector is manufacturing (64% of exports) o Trade bloc with free trade agreements to liberalize commerce and improve integration • Supports trade flows with Asia in order to compete with Brazil and Argentina which participate in Mercosur 。 Accounts for 36% of Latin America's GDP, comparable to Brazil 。 Canada has bilateral free-trade agreements with all four Pacific Alliance countries and it has initiated an application for Associate Membership in the Alliance • Pacific Alliance is an Attractive Long-Term Opportunity o Region is the 6th largest goods exporter in the world o Trade bloc with governments supporting growth/significant infrastructure spending o Solid GDP growth rates relative to peers o Considerable room to increase banking penetration (avg. domestic credit around 2/3 of GDP) ○ Fast-growing middle-class with increasing financial demands o Favourable demographics for banking needs ○ Relatively stable legal, tax, and regulatory infrastructure in place o Central bankers have earned credibility and banking system is well-capitalized Scotiabank® 32 32#33Mexican Economy Diverse economy with a strong balance sheet • The Mexican economy reflects a solid mix of commodities, goods production, and services Trade remains dominated by the U.S., but Mexico's diversification agenda is underpinned by 13 free-trade agreements with 47 countries that account for 40% of global GDP Despite NAFTA-related uncertainty, investment rebounded in 2018 and trade has returned to making a positive contribution to economy-wide growth 15.9% Finance, Insurance, & Real Estate 16.2% Other 3.1% Natural Resources 6.5% Transportation & Warehousing 5.8% Health & Education MEXICAN GDP BY INDUSTRY (Q3 2018) 1.9% Professional, 3.8% Scientific, & Technical Public Services Administration Top 5 Trading Partners 17.5% Wholesale & Retail Trade 15.9% Manufacturing 6.3% Mining and Oil & Gas Extraction 7.0% Construction Contributions to Mexican GDP Growth 5 y/y % change 4 3 2 1 0 -1 -2 Other Net Exports Inventories GFCF Government Consumption -3 16 Real GDP 17 18 Sources: Scotiabank Economics, Haver Analytics. Germany 3% Japan 3% Canada 4% China 10% Others 21% United States 59% Scotiabank® 33 33#34Chilean Economy Advanced economy with wide-ranging trade links Chile's mix of economic activities reflects its status as an advanced market economy Chile's diversified trading relationships are supported by 21 free-trade agreements with 59 countries that account for 70% of global GDP Investment has been a strong contributor to growth in Chile over the past year, which should underpin future productivity gains 15.1% Finance, Insurance, & Real Estate 8.7% Other 1.9% Restaurants & Hotels 8.5% Transportation & Warehousing 3.4% Natural Resources CHILEAN GDP BY INDUSTRY (SEP 2018) 19.3% Housing & Personal Services 9.7% Wholesale & Retail Trade -10.2% Manufacturing -12.5% Mining and Oil & Gas Extraction 6.2% Construction 4.6% Public Administration 8 y/y % change 6 4 2 0 -2 -4 -6 Contributions to Chilean GDP Growth 17 16 Sources: Scotiabank Economics, Haver Analytics. Net Exports Inventories Investment Government Consumption Real GDP 18 Top 5 Trading Partners Others 40% China 27% South Korea 4% United States 16% Japan Brazil 6% 7% Scotiabank® 34#35Peruvian Economy Resilient economic fundamentals • Peru's important resource sectors are increasingly balanced by stronger service-sector activity and solid economic fundamentals Peru has 16 free-trade agreements with 49 countries that account for 66% of global GDP Investment is making a consistently strong contribution to GDP, which should make higher growth rates more sustainable in the future 12.7% Manufacturing 9.6% Finance, Insurance, & Real Estate 31.5% PERUVIAN GDP BY INDUSTRY (Q3 2018) 20.7% Transportation, Information & Commerce 5.8% Construction 8 y/y % change 6 4 2 0 -2 -4 -6 Contributions to Peruvian GDP Growth 17 16 Sources: Scotiabank Economics, Haver Analytics. Other 5.1% Natural Resources 14.6% Mining & Energy Top 5 Trading Partners China 26% Others 44% Net Exports Inventories GFCF Government United States Consumption Real GDP 18% 18 South Korea 3% Spain Brazil 4% 5% Scotiabank® 35#36Colombian Economy Gaining momentum Services account for a rising share of Colombian GDP compared with traditional strengths in extractive industries Colombia continues to build on its 10 free-trade agreements with 42 countries that account for 38% of global GDP Rising consumption, supported by public spending, reflects an expanding middle class as growth gains momentum and converges toward the economy's underlying potential 13.6% Finance, Insurance, & Real Estate 9.1% Other 6.2% Natural Resources 2.8% Information & Communication 2.4% Arts & Entertainment COLOMBIAN GDP BY INDUSTRY (Q3 2018) 7.0% Professional, Scientific, & Technical Services 16.9% Wholesale, Retail Trade, Accommodation & Food Services 12.0% Manufacturing 8.2% Mining and Oil & Gas Extraction -14.9% 6.9% Construction Public Administration Contributions to Colombian GDP Growth 5 y/y % change 4 3 2 1 0 -1 -2 Other Net Exports GFCF Government Consumption -3 Real GDP 16 17 18 Sources: Scotiabank Economics, Haver Analytics. Top 5 Trading Partners United States Others 29% 44% China 14% Germany 3% Brazil Mexico 4% 6% Scotiabank® 36#37Other Regions Leading Caribbean & Central American franchise. Reducing portfolio investments in Asia. • Caribbean & Central America 。 Operations in 16 countries contributing - CAD$0.7B in earnings in 2018 。 Well-established, diversified franchise that serves retail, commercial and corporate customers ○ Actively managing footprint to ensure scale in larger growth markets and reduce risk profile: ○ О О Announced acquisition in Dominican Republic in August 2018 which doubles customer base and creates 4th largest bank Announced sale of operations in 9 smaller countries in Caribbean in November 2018 Announced sale of pension and insurance operations in the Dominican Republic in December 2018 Announced sale of banking and insurance operations in El Salvador in February 2019 o Recognized by Global Finance Magazine as: • Asia "Best Bank Award 2017" in the Bahamas, Barbados, Costa Rica, Turks & Caicos and U.S. Virgin Islands; "World's Best Consumer Digital Bank 2017" in 24 countries across Latin America and the Caribbean; and "Best in Mobile Banking" in the Caribbean region ○ Thailand: 49% interest in Thanachart Bank (2007) ○ Announced non-binding MOU in February 2019 to merge with Thai Military Bank and materially reduce interest O CAD$3.0B carrying value as of October 31, 2018 ○ CAD$590MM of net income for twelve months ended October 31, 2018 。 China: 19.9% interest in Bank of Xi'an (2009) ○ CAD$772MM carrying value as of October 31, 2018 CAD$456MM of net income for twelve months ended October 31, 2018 Scotiabank® 37#38Appendix 3: Canadian Housing Market Scotiabank®#39Canadian Housing Market Higher interest rates and new regulations driving soft landing • Significant moderation in price growth since 2017 (top right chart).. 。 The composite national MLS Home Price Index rose 0.8% Y/Y, with gains concentrated in lower-cost apartments and townhomes. Average price fell 5.5% Y/Y 。 Three of Canada's five largest cities experienced year-over-year price declines (Vancouver, Calgary, Edmonton) • Resale volumes down 4% Y/Y (table below) 。 The sales-to-new listings ratio rose to 56.7% in the month, a level consistent with balanced demand-supply conditions • Greater Toronto Market: Average home price increased 2.7% from a year ago. Resale volumes have moderated and are below 10-year average (lower right chart) • Greater Vancouver Market: Average home price fell 4.5% from a year ago led by weakness in the single-family home segment—but home purchases climbed 1.2% Price Growth by Dwelling Type² 25 20 20 15 10 Apartment Single- 5 Family Townhome 0 -5 MLS Home Price Index, aggregate, y/y % change -10 16 17 18 19 Toronto & Vancouver Home Sales2 140 home sales, 000s of units, annualized Canada² Sales (% change) New listings (% change) Average price (% change) Jan-19 Dec-18 Jan-19 120 Greater Toronto m/m* m/m* yly 100 3.6 -2.0 -4.0 1.0 -0.5 8.0 180 80 -2.9 -1.4 -5.5 MLS HPI (% change)** -0.5 -0.3 0.8 60 60 Jan-19 Dec-18 Jan-18 Greater Vancouver Sales-to-new listing ratio (level)* 56.7 55.3 64.2 40 40 Months inventory (level)* 5.3 5.5 4.9 20 20 *Seasonally adjusted **Not seasonally adjusted 1 Sales and listings figures reported in seasonally-adjusted m/m terms, while MLS HPI growth rates reported as non seasonally-adjusted y/y 2 Sources for charts and table: Scotiabank Economics, CREA Actual 10-Year Avg. 0 11 12 13 14 15 16 17 18 Scotiabank® 39#40Per cent -6 4 6 25,000 20,000 Jan 2007 Jan 2008 Jan 2009 Jan 2010 Jan 2011 Canadian Housing Market Higher interest rates and new regulations driving soft landing Volume of Home Sales Near 10-Year Average* 50,000 45,000 40,000 35,000 30,000 Monthly home sales* за 10-year monthly moving avg.* Per cent Significant Moderation in Price Growth* (Aggregate Composite MLS® Home Price Index Y/Y Percentage Change) 15 22250 10 Jan 2012 Jan 2013 Jan 2014 Jan 2015 Jan 2016 Jan 2017 Jan 2018 Jan 2019- *Actual not seasonally adjusted Annual Price Change by Province* (Y/Y Percentage Change) ון *Actual not seasonally adjusted January 2019 vs. January 2018 -8 -10 CA BC AB SK MB ON QC NB SS NS PE NF 1 Sources for charts and table: CREA; MLS® Home Price Index growth rates reported as non seasonally-adjusted y/y Per cent 6 8 -5 -10 Jan 2006 Jan 2007 Jan 2008 Jan 2009 Jan 2010 Jan 2011 Jan 2012 Jan 2013 Jan 2014 Jan 2015 Jan 2016 Jan 2017 Jan 2018 *Actual not seasonally adjusted Canada's Five Largest Metropolitan Areas* (MLS® Home Price Index Benchmark Price Y/Y Percentage Change) 2.7 0 -2 -4 -4.52 -6 GTA GVA *Actual not seasonally adjusted 6.32 Average -0.45 -2.88 -3.87 Montreal Calgary Edmonton Scotiabank® 40 Jan 2019#41Housing Policy Developments in Canada Consistent policy initiatives to maintain a balanced and sustainable market 2019 2018 2017 2016 ⚫ British Columbia: Increase in speculation tax on foreign and domestic home owners who do not pay income tax in BC from 0.5% of a property's assessed value to 2%; additional school tax levied on portion of a property's value that exceeds CAD 3 mn. Canada: OSFI imposes more stringent stress tests for uninsured mortgages, including a minimum qualifying rate at the greater of the five-year fixed posted rate or the contractual rate plus 200 bps, effective January 1, 2018 • Ontario: Elimination of rent control on new rental units first occupied on or before November 1, 2018 ⚫ British Columbia: Extension of the Property Transfer Tax on non-resident buyers. Investment of more than CAD 1.6 bn through FY2021 toward the goal of building 114,000 affordable housing units in the next 10 years . Ontario: 16 measures aimed to slow rate of house price appreciation Key aspects include: 。 15% non-resident speculation tax o Expanded rent control to all private rental units in Ontario 。 Vacant home tax o CAD 125 mn five-year program to encourage construction of new rental apartment buildings • . Canada: Qualifying stress rate for all new mortgage insurance must be the greater of the contract mortgage rate or the Bank of Canada's conventional five-year fixed posted rate Low-ratio mortgage insurance eligibility requirements updated for lenders wishing to use portfolio insurance: o Maximum amortization 25 years 。 CAD$1MM max. purchase price o Minimum credit score of 600 。 Owner-occupied property Elimination of primary residence tax exemption for foreign buyers • Min. down payment on insured increased from 5% to 10% (for homes $0.5-$1MM) • British Columbia: 15% land transfer tax on non-resident purchases in Metro Vancouver introduced Scotiabank® 41#42Housing Market Differences vs U.S. Canada's housing market features distinct practices and policies Regulation and Taxation Product Underwriting Canada Mortgage interest not tax deductible Full recourse against borrowers in most provinces Foreclosure on non-performing mortgages - no stay periods Insurance Mandatory default insurance mortgages with LTV > 80% 。 CMHC backed by Government of Canada (AAA). Private insurers are 90% government backed o Insurance available for homes up to CAD 1 mn o Premium is payable upfront Covers full amount for life of mortgage Homebuyers must qualify for mortgage insurance at an interest rate that is the greater of their contract mortgage rate or the Bank of Canada's conventional five-year fixed posted rate Re-financing cap of 80% LTV on non-insured mortgages Amortization Maximum 25-year amortization on mortgages with LTV > 80% Maximum 30-year amortization on conventional mortgages Down payment of > 20% required for non-owner occupied properties Conservative product offerings, fixed or variable rate options Much less reliance upon securitization and wholesale funding Asset-backed securities not subjected to US-style off-balance sheet leverage via special purpose vehicles • Terms usually three or five years, renewable at maturity •Extensive documentation and strong standards U.S. • Tax-deductible mortgage interest creates incentive to borrow and delay repayment • Lenders have limited recourse in most states 90-day to 1-year stay period to foreclose on non-performing mortgages • No regulatory LTV limit Private insurers are not government backed . Can include exotic products (e.g. adjustable rate mortgages, interest only) 30-year term most common Wide range of documentation and underwriting requirements Scotiabank® 42#43Canadian Household Credit Public policy changes are moderating growth in household credit Total household credit grew at 3.1% in nominal terms in 2018 vs 2008 peak of 12.4% y/y • Consumer loans excluding mortgages (i.e. cards, HELOCs, unsecured lines, auto loans, etc.) grew at 3.0% in 2018 vs > 5% in late-2017 Mortgage credit grew at 3.1% in 2018 vs 2008 peak of 13% HOUSEHOLD CREDIT GROWTH CONSUMER LOAN GROWTH RESIDENTIAL MORTGAGE GROWTH 20 20 %, 3-month moving average %, 3-month moving average 18 15 y/y % change 16 14 y/y % change 12 10 8 6 0 m/m% change, SA 4 2 m/m % change, SA 0 20 %, 3-month moving average 18 16 y/y % 14 change m/m% 12 change, SA 10 10 8 5 6 4 2 0 -5 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 Sources: Scotiabank Economics, Bank of Canada. 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 Sources: Scotiabank Economics, Bank of Canada. 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 Sources: Scotiabank Economics, Bank of Canada. Scotiabank® 43#44Household Debt: Canada vs. U.S. Canadian households' balance sheets compare favourably to US Canadian debt-to-income ratio is now 2.2 percentage points below the U.S. peak in 2008 Over the last 8 years, increases in the Canadian debt-to-income ratio have slowed vs 2002-10 Calculated on the same terms, Canada's debt-to-income is currently 167% vs 134% in the U.S. Canadian debt-to-assets ratio remains below U.S. o U.S. households have incentive to pursue higher asset leverage in light of mortgage interest deductibility o Debt is a stock concept, to be financed over one's lifetime. Income is a flow concept measuring one single year's earnings. Debt should be compared to lifetime or permanent income, or assets • Ratio of total household debt-to-GDP remains lower in Canada than U.S. 。 Calculated on a comparable basis, the ratio of household credit market debt is 98.6% in Canada vs 101.1% in the U.S. Household Credit Market Debt to Disposable Income Total Household Liabilities As % of Total Assets Household Credit Market Debt to GDP 200 household credit liabilities as % of disposable income 173.8 180 160 140 120 100 80 60 660 30 25 166.8 134.0 20 20 Adjusted Canadian* 15 Official Canadian Official US 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 * Adjusted for US concepts and definitions. Sources: Scotiabank Economics, BEA, Federal Reserve Board, Statistics Canada. household debt as % of assets 10 US 130 % of GDP 120 110 US with unincorporated business debt 100 Original Canada 102.9 101.1 98.6 90 Canada* 17.8 80 Canada 70 Original 74.9 US 16.8 60 50 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 Sources: Scotiabank Economics, Federal Reserve Board, Statistics Canada. 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 * Adjusted for US concepts and definitions. Sources: Scotiabank Economics, BEA, Federal Reserve Board, Statistics Canada. Scotiabank® 44#45Appendix 4: Additional Information Scotiabank®#46Additional Information Scotiabank Listings: Toronto Stock Exchange (TSX: BNS) New York Stock Exchange (NYSE: BNS) Scotiabank Credit Ratings Scotiabank Common Share Issue Information: CUSIP: 064149107 . ISIN: CA0641491075 FIGI: BBG000BXSXH3 NAICS: 522110 Moody's Investors Services Dominion Bond Standard & Fitch Ratings Poor's Rating Service Ltd. Aa2 A+ AA- AA A2 A- AA- AA (low) Baa1 BBB+ A (low) A-1 F1+ R-1 (high) Aaa Not Rated AAA AAA Legacy Senior Debt¹ Senior Debt² Subordinated Debt (NVCC) Short Term Deposits/Commercial Paper P-1 Covered Bond Program Outlook Stable Stable Stable Stable 1 Includes: (a) Senior debt issued prior to September 23, 2018; and (b) Senior debt issued on or after September 23, 2018 which is excluded from the bank recapitalization "bail-in" regime Subject to conversion under the bank recapitalization "bail-in" regime For further information, please contact: www.scotiabank.com/investorrelations Scotiabank® 46#47Contact Information Investor Relations Philip Smith Senior Vice President 416-863-2866 [email protected] Michael Lomas Managing Director Treasury Sales and Market Development 416-866-5734 [email protected] Steven Hung Vice President 416-933-8774 [email protected] Lemar Persaud Judy Lai Director Director 416-866-6124 [email protected] 416-775-0485 [email protected] Tiffany Sun Manager 416-866-2870 [email protected] For further information, please contact: www.scotiabank.com/investorrelations Scotiabank® 47