#1Scotiabank Investor Presentation Second Quarter, 2009 May 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 Overview Rick Waugh President & Chief Executive Officer 3 Scotiabank Earning Through Challenging Environment Net income: $872MM, EPS: $0.81, ROE 17.6% • Record top-line revenue growth, up 12% • Solid profitability in all businesses Proactive risk management Solid capital - maintained dividend at $0.49/share 4#3Scotiabank net income ($ millions) Solid Earnings in Our Three Main Businesses 422 438 410 388 335 1332 300 328 255 Q2/08 Q1/09 Q2/09 Other* Canadian International Scotia Capital (32) (198) (284) Year over year Canadian Banking: Strong deposit & asset growth, higher PCLs International: Wider margins, positive impact of acquisitions & FX, higher PCLS Scotia Capital: Good loan volumes, wider spreads, strong trading results & higher PCLS Other: Higher funding costs, securities writedowns, higher securitization revenues, positive FI impact * includes Group Treasury and other corporate items, which are not allocated to a business line Scotiabank • • • Positives Outlook "The New Normal" Financial & capital markets stabilizing Monetary and fiscal stimulus working Continued growth in emerging markets Long-term demographics, technology, globalization Negatives Markets & economies still fragile Lower leverage, consumption & growth expectations More government, more regulation Scotiabank Our chosen markets to perform well Proven strategy, strong management and capital ☐ Bright future 6#4Scotiabank Scotiabank Performance Review Luc Vanneste Executive Vice-President & Chief Financial Officer 7 Solid Quarter Q2/09 Reported Qtr/Qtr Yr/Yr Net income ($MM) $872 +4% (11)% EPS $0.81 +1% (16)% ROE 17.6% 70 bps (380) bps Productivity ratio 51.4% (730) bps (340) bps + Quarter over quarter Growth in net interest income + Stronger trading, securitization revenues + Lower expenses - Higher credit provisions - Higher taxes 8#5Scotiabank Q2/09 Items of Note Pre-tax Item ($MM) After-tax ($MM) EPS Impact Business Line; Line Item AFS securities write-downs* Other: Other Income (97) (104) (70) (0.07) SC: Other Income (7) Credit card sale in (36) (26) Mexico (0.03) Int'l: Other Income Provisions release in Mexico 29 29 Q1/09 AFS securities write-downs were $(236)MM Scotiabank Revenues (TEB) ($ millions) 3,673 3,421 3,272 1,509 1,299 1,385 224 21 0.02 Int'l: PCLs 9 Record Revenues Q2/09 vs. Q1/09 revenues: up 7% ■ net interest income up 6% + increase in fair value of financial instruments shorter quarter ■ other income up 9% + higher securitization revenues, fixed income revenues & credit fees + lower AFS securities write-downs realized gains on securities, underwriting & mutual fund fees 1,973 2,036 2,164 Q2/08 Q1/09 Q2/09 Other income Net Interest Income (TEB) Q2/09 vs. Q2/08 revenues: up 12% ■ net interest income up 10% + asset growth, forex lower margin & tax-exempt income ■ other income up 16% + securitization revenues & strong trading results + credit fees, investment banking & trading revenues, forex - securities writedowns, lower wealth mgmt. fees 10#6Strong Year-over-Year Asset Growth Scotiabank average assets, $ billions 14% (2)% 529 519 519 Residential mortgages 455 113 111 111 106 Personal loans 50 52 52 & credit cards 44 135 133 Business & 133 government 111 (includes BA's) 104 Securities 97 104 98 119 Other 96 Q2/08 Yr/Yr Q2/09 Business & government loans: +19% Personal loans: +18% Residential mortgages: +5% Scotiabank 11 134 119 Q1/09 Qtr/Qtr Q2/09 Personal Loans: +4% Business and government loans: (2)% Residential mortgages: (2)% Higher Net Interest Margin (%) 1.76 1.79 1.68 1.71 1.53 Q2/08 Q3/08 Q4/08 Q1/09 Q2/09 All-Bank: +18 bps qtr/qtr + improved lending margins + favourable change in fair value of financial instruments - continued competitive pressures 12#7Scotiabank Disciplined Expense Management Non-interest expenses ($ millions) 1,794 2,010 1,886 1,130 1,024 1,005 388 379 353 436 492 483 Q2/08 Q1/09 Q2/09 Salaries & employee benefits Premises & technology Other Scotiabank Q2/09 vs. Q1/09 expenses: down 6% + lower stock & performance-based compensation + shorter quarter - lower remuneration costs + reduction in discretionary spending: advertising, business development costs Q2/09 vs. Q2/08 expenses: up 5% ■ expenses down 1% excluding forex, acquisitions salaries & premises costs, driven by growth initiatives branch expansion in Mexico & Canada + lower stock & performance-based compensation + reduction in discretionary spending: advertising, professional expenses 13 Maintaining Solid Capital Tier 1 capital ratios (%) Risk-weighted assets (RWAs) ($ billions) 251 240 242 226 219 9.6 9.8 9.5 9.6 9.3 7.8 7.5 7.6 7.7 7.3 Q2/08 Q3/08 Q4/08 Q1/09 Q2/09 ■ Internal capital generation ■ Since Q2: $650 million Tier 1 Trust securities ■ Further capacity to raise innovative capital and preferred shares 14 Q2/08 Q3/08 Q4/08 Q1/09 Q2/09 ◉ Disciplined management of RWAS#8Scotiabank Canadian Banking Solid Quarter Net Income ($ millions) 438 422 410 Q2/08 Q1/09 Q2/09 Q2/09 vs. Q1/09 net income: down 7% - revenues down 2% - ■ NII stable, higher margin offset by shorter quarter lower wealth management revenues, reflecting Dundee Wealth (DW) equity accounted earnings + expenses down 4% + reduced discretionary & initiative spending + lower stock based compensation PCLs up $33MM, incl. $10MM auto sectoral provision Q2/09 vs. Q2/08 net income: down 3% + revenues up 5% - - + strong retail volume growth, lower margin lower wealth management revenues expenses up only 1% acquisitions, partly offset by cost control PCLs up $86MM Scotiabank Net Income ($ millions) 388 335 332 Q2/08 Q1/09 Q2/09 15 International Banking Solid Quarter Q2/09 vs. Q1/09 net income: down 14% - revenues down 8% $36MM loss on sale of portion of credit card portfolio - forex revenues strong, but down from record Q1 MTM write-downs on non-trading securities + expenses down 6% + lower discretionary spending + PCLs flat, Q2 included a $29MM reversal of a retail provision no longer required in Mexico Q2/09 vs. Q2/08 net income: down 1% + revenues up 13% + positive impact of forex translation & acquisitions + solid asset growth expenses up 19% - acquisitions and negative impact of forex - higher remuneration due to branch expansion, partly offset by lower discretionary spending PCLs up $55MM 16#9Scotiabank Scotia Capital Record Quarter, Despite Rise in PCLS Net Income ($ millions) 300 255 328 Q2/08 Q1/09 Q2/09 Q2/09 vs. Q1/09 net income: up 9% + revenues up 20% + record quarter in Global Capital Markets + higher spreads & loan origination fees, partly offset by small decrease in average loans + expenses down 21% + lower performance based compensation PCLs up $149MM, $50MM auto sectoral provision Q2/09 vs. Q2/08 net income: up 29% + revenues up 57% - + near record fixed income, very strong institutional equity, record precious metals revenues + significantly higher loan volumes, wider spreads + positive impact of forex translation + expenses down 5% + lower performance based compensation PCLs up $168MM Scotiabank Net Income ($ millions) Q2/08 Q1/09 Q2/09 (32) (198) (284) 17 Other Segment* Q2/09 vs. Q1/09 net income + higher securitization revenues + change in fair value of financial instruments + lower net securities write-downs $27MM increase in general allowance Q2/09 vs. Q2/08 net income relatively higher term funding costs compared to declining transfer pricing rates - write-downs on AFS securities + higher securitization revenues + change in fair value of financial instruments includes Group Treasury and other corporate items, which are not allocated to a business line 18#10Scotiabank 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 • 19 Canadian Banking Outlook Revenue & Volume growth - Cautiously optimistic on asset growth despite downturn - Deposits growth strong, but moderating • Acquisition integration • - Re-branding of E*TRADE to Scotia iTRADE - - CI & Dundee Expenses well managed Provisions impacted by challenging economic conditions, but within expectations 20#11Scotiabank International Banking Outlook • Slower economic growth in key markets in 2009 • Key priorities: credit risk, prudent asset growth, margins, expense control • Continuing actions to mitigate risk • Rolling out longer-term initiatives Scotiabank 21 Scotia Capital Outlook Strong, broad-based results Continued benefit from wider spreads Prudently managing credit and market risks 22#12Scotiabank Scotiabank Risk Review Brian Porter Group Head, Risk & Treasury 23 Q2/09 Risk Overview • Managing through challenging markets Specific provisions for credit losses: $402MM vs. $281MM in Q1/09 Established sectoral provision of $60MM for wholesale auto Added $27MM to general allowance - now at $1.35 billion Higher coverage ratio Proactively managing credit portfolios Retail International Commercial Wholesale auto North American real estate Market risk well controlled - Lower VaR: $16.0MM vs $21.7MM 24#13Scotiabank $ millions Specific Provisions for Credit Losses Q2/08 Q3/08 Q4/08 Q1/09 Q2/09 Canadian P&C Retail 82 77 78 122 126 Commercial 20 22 29 33 52 102 99 107 155 178 International P&C Retail 69 81 105 130 125 Commercial (25) (15) (14) (10) 60 56 90 116 115 Scotia Capital (9) 4 10 10 109* 153 159 207 281 402 PCL ratio (bps) 24 23 29 37 56 * U.S.: $74mm; Canada: $35mm 25 Scotiabank $ millions Specific Provisions: Retail 252 251 183 130 125 158 151 105 69 81 82 77 78 70 Q2/08 PCL ratio (bps) 41 Q3/08 Q4/08 122 126 Q1/09 Q2/09 Canadian Banking International Banking 40 26 44 61 63#14Scotiabank $ millions Specific Provisions: Commercial & Corporate 151 109 24 29 1 10 10 2 52 52 20 22 29 33 T T T -15 -14 -10 -9 -25 Canadian Banking I International Banking Scotia Capital Q2/08 Q3/08 PCL ratio (bps) 1 Scotiabank 1.20% Q4/08 Q1/09 Q2/09 8 9 47 27 Coverage on Loan Portfolio Total Allowance for Credit Losses as % of Loans and Acceptances 1.00% 0.95% 0.92% 0.87% 0.87% 0.88% 0.80% 0.60% 0.40% 0.20% 0.00% Q2/08 Q3/08 28 Q4/08 Q1/09 Q2/09#15€ Scotiabank Canadian and International Retail Portfolios • Portfolios performing as expected • • - Highly secured and well diversified - Delinquencies rising in some products as economies soften Actively managing risks - Canada: indirect auto and unsecured revolving credit - International: Chile and Peru acquisitions, Mexico retail Actions taken to mitigate risks - Selective policy changes and risk-based pricing - Targeted payment relief for certain customers - Investing in collections staff and technology Scotiabank 29 International Commercial Portfolio loans & acceptances Q2/09 = $38 billion Peru Financial Services. Holding Companies 7% 10% Asia/Pacific (10 Other 7% countries) 27% 9% Communications & Media 6% Automotive 3% Mexico 11% Chile 18% " Well secured ■ Caribbean Central America 27% Agrifoods and Consumer 15% Transportation 10% Real Estate 11% Hotels & Gaming 8% Industrial Products 5% Infrastructure, Privatization & Power 9% Other 17% Portfolios in Asia/Pacific, Chile & Peru performing well Closely monitoring portfolios in Mexico and Caribbean & Central America Hotel/ Gaming exposures Impact of swine flu epidemic in Mexico 30#16Scotiabank Wholesale Auto Portfolio Total(1) Total(1) $ billions Canada U.S. Other Q2/09 Q1/09 OEM(2) 0.1 0.1 0.2 0.6 Finance & Leasing 0.6 0.3 0.2 1.1 1.2 Parts Manufacturers 0.3 0.4 0.1 0.8 0.8 Dealers/Floorplan 2.9 2.9 3.0 3.9 0.8 0.3 5.0 5.6 GM & Chrysler only 11% of total dealer exposure " Portfolio regularly stress tested " $60 million sectoral provision Year-to-date PCL ratio: 22bps (1) loans and acceptances (2) Original Equipment Manufacturers Scotiabank $ billions 31 North American Real Estate Total(1) Total(1) Canada U.S. Q2/09 Q1/09 Residential 3.4 0.4 3.8 3.8 Commercial & Industrial 1.0 1.0 1.2 Office 0.6 0.1 0.7 0.6 Retail 0.9 0.3 1.2 1.0 REITS 0.5 1.3 1.8 2.2 6.4 2.1 8.5 8.8 Cdn. Residential: Single Family (55%), Condominium (30%), Income Producing (15%) Development deals with experienced, long-term clients REITs are primarily liquidity facilities to investment grade borrowers Year-to-date PCL ratio: 29bps - primarily relating to US condo construction (1) loans and acceptances 32#17Scotiabank 2009 Risk Outlook • Challenging credit markets for balance of the year • Focused on actively managing risk • Provisions to remain within risk tolerances 33 Scotiabank Appendices 34#18Scotiabank Canadian Banking Solid Quarter ($MM) Q2/09 Q1/09 Change Q/Q Comments on Q/Q Movements NII 1,147 1,146 +1 ■ higher margin & volume growth, offset by shorter quarter Other 524 556 (32) Income Expenses 899 934 +35 PCL 188 155 (33) Net Income 410 438 (28) ■ lower income recognition on DW investment ■ lower wealth management revenues, seasonally lower VISA fees higher credit fees in Commercial ■ strong cost control program, timing & shorter quarter ■ lower volume related & stock-based compensation ■ $10MM sectoral provision for Auto ■retail PCLS stable higher PCLS in Commercial ■stable underlying earnings ■ benefitting from prudent expense & risk management 35 Scotiabank Canadian Banking Stable Revenues During Challenging Conditions Revenues (TEB) ($ millions) 1,702 1,671 1,588 1,041 1,038 992 384 317 389 279 277 244 Q2/08 Q1/09 Retail & Small Business ■Commercial Banking ■Wealth Management Q2/09 Q2/09 vs. Q1/09 revenues: down 2% NII stable, higher margin offset by shorter quarter decrease in wealth management revenues: lower DW equity accounted earnings & lower full service brokerage seasonally lower forex revenues & VISA fees + higher credit fees in Commercial Q2/09 vs. Q2/08 revenues: up 5% Retail & Small Business + solid, but moderating, asset growth + strong deposit growth Commercial Banking + higher margin due to lower wholesale funding rates + continued strong deposit growth Wealth Management lower full service brokerage & mutual fund fees Cl contribution offset by DW write-down + ITRADE acquisition 36#19Scotiabank Canadian Banking Solid Volume Growth Average Balances ($BN) Q2/09 Q1/09 Q2/08 Y/Y Q/Q Residential 118.0 118.2 108.8 8.4% Mortgages* (0.1)% Personal Loans 34.2 33.0 28.2 21.1% 3.5% Credit Cards** 9.1 9.1 8.7 5.5% 0.7% Non-Personal Loans & 25.7 26.3 25.6 0.5% (2.3)% Acceptances Personal 92.3 91.4 83.6 10.4% 0.9% Deposits Non-Personal 48.9 48.8 42.0 16.4% 0.2% Deposits * before securitization **Includes ScotiaLine VISA Scotiabank 37 International Banking Solid Underlying Quarter Q2/09 Q1/09 Change Q/Q Comments on Q/Q Movements ■ improved margins NII 959 947 +12 Other 349 471 (122) Income Expenses 729 772 (43) PCL 115 116 (1) Net Income 332 388 (56) ■ moderating loan growth $(36)MM loss on sale of portion of card portfolio MTM loss on non-trading securities ■ lower forex revenues ■reflects cost containment & operating improvement efforts, as well as some timing ■ benefit from reversal of a $29MM retail provision no longer required in Mexico ■positive impact from increased collection efforts ■ down from record Q1 ■ continued focus on expense & risk management 38#20Scotiabank International Banking Stable Underlying Revenues Revenues (TEB) ($ millions) 1,418 1,308 1,153 359 295 323 522 503 410 537 420 510 Q2/08 Mexico Q1/09 Q2/09 Caribbean & Central America Latin America & Asia Q2/09 vs. Q1/09 revenues: down 8% ■ Mexico - loss on sale of portion of credit card portfolio - lower forex revenues vs. very strong Q1 + solid volume growth & wider spreads ■ Caribbean & Central America moderating loan volumes + higher spreads ■ Latin America & Asia - MTM loss on non-trading securities + benefit from increased investment in Thailand Q2/09 vs. Q2/08 revenues: up 13% ■ Mexico + higher P&C loan volumes & spreads negative impact of forex & sale of portion of credit card portfolio ■ Caribbean & Central America + higher underlying spreads & solid loan growth + positive impact of forex Latin America & Asia + acquisitions in Peru + positive impact of forex translation 39 Scotiabank International Increased Diversification Q2/07 Revenue: $979MM Q2/09 Revenue: $1,308MM Other LA & Asia 8% Mexico 35% C&CA 42% Peru 12% +34% Other LA & Asia 10% Chile 3% 40 Mexico 23% Peru 19% C&CA 38% Chile 10%#21Scotiabank Economic Outlook in Key Markets Real GDP Growth % 2000-2007 2008e 2009f 2010f Avg. Mexico 2.9 1.3 (4.5) 1.7 Peru 5.1 9.8 3.5 3.8 Chile 4.4 3.2 (1.0) 2.0 Jamaica 1.5 (0.6) (3.0) 0.5 Trinidad & 8.2 3.0 (0.5) 2.5 Tobago Costa Rica 4.7 3.0 (0.5) 1.5 DR 5.4 5.3 0.0 1.5 2009f 2010f Canada (2.6) 1.7 U.S. (2.9) 1.8 Source: BNS Economics, as of May 26th Scotiabank 41 Scotia Capital Record Quarter, Despite Rise in PCLs ($MM) Q2/09 Q1/09 Change Q/Q NII 345 338 +7 Comments on Q/Q Movements ■ wider spreads & higher loan origination fees, partially offset by small decrease in average loans Other 502 366 +136 stronger trading revenues Income Expenses 231 291 +60 ■ lower performance based compensation & other personnel costs ■ Q1/09 expense level was high vs. 8 quarter average ■ $50MM auto sectoral provision PCL 159 10 (149) Net Income 328 300 +28 ■ One large U.S. account & a few smaller accounts in the U.S. & Canada ■record quarter strong & diversified revenues & lower expenses offset higher PCLs 42#22Scotiabank Revenues (TEB) ($ millions) 704 847 Scotia Capital Record Revenues 400 538 308 307 447 396 231 Q2/08 Q1/09 Q2/09 Global Capital Markets (GCM) Global Corporate & Investment Banking (GC&IB) Q2/09 vs. Q1/09 revenues: up 20% + broad based trading strength; higher derivatives revenues + higher spreads & credit related fees, partly offset by decrease in average volumes + CDO write-downs in Q1/09 - lower investment banking revenues vs. record Q1 Q2/09 vs. Q2/08 revenues: up 57% Global Corporate & Investment Banking + highest revenues since Q4/02 + significantly higher loan volumes, wider spreads & higher loan origination fees + strong increase in credit fees + loss on non-trading securities in Q2/08 Global Capital Markets + near record quarter from fixed income & record quarter for precious metals + very strong institutional equity & forex revenues + higher underlying derivatives revenues 43 Scotiabank Impact of Forex Impact ($ millions) Q2/09 vs. Q2/08 Q2/09 vs. Q1/09 Net Interest Income (TEB) 120 (1) Other Income 43 6 Non-interest expenses (44) 1 Net income 73 4 EPS (diluted) 7 cents Average Rates Q2/09 Q1/09 Q2/08 $US/$CAD 0.80 0.82 0.99 Mexican peso/$CAD 11.51 11.06 10.62 Peruvian new sol/$CAD 2.54 2.56 2.84 Chilean peso/$CAD 482.1 531.0 454.8 44#23Scotiabank $ millions Gross Impaired Loans Q2/08 Q3/08 Q4/08 Q1/09 Q2/09 Canadian P&C Retail 444 472 523 621 747 Commercial 244 228 238 262 307 688 700 761 883 1,054 International P&C Retail 664 688 833 997 1,110 Commercial 604 674 776 919 994 1,268 1,362 1,609 1,916 2,104 Scotia Capital 56 101 124 186 439 Total 2,012 2,163 2,494 2,985 3,597 % loans & acceptances 0.74 0.76 0.82 0.97 1.20 Scotiabank $ millions 45 Gross Impaired Loan Formations Canadian Retail: higher formations in Q1/09 Q2/09 Canadian P&C residential mortgages, auto-related portfolios & revolving credit - Retail 328 436 - Commercial 31 115 359 551 International P&C - Retail 336 266 - Commercial 142 97 478 363 Canadian Commercial: classification of several small accounts Int'l. Retail: lower formations due to assistance programs for credit worthy customers Int'l. Commercial: classification of a number of accounts in Puerto Rico, Chile & Peru Scotia Capital - Canada - U.S. Total 167 60 149 60 316 897 1,230 46 Scotia Capital: classification of a large real estate finance company in U.S. & Canada, manufacturer in Canada and two real estate accounts in U.S.#24Scotiabank 0.80% 0.60% 0.40% Relative PCL Performance Specific Provisions as % of Average Loans and Acceptances 0.24% 0.20% 0.16% 0.14% 0.32% 0.26% 0.24% 0.00% 2005 2006 Scotiabank (Outstandings at Q2/09, $ billions) 119* 0.13% 2007 0.51% 2008 BNS 4 Cdn. Bank Peers 47 0.37% 0.72% 0.56% Q1/09 Q2/09 Canadian Retail Loans and Provisions 21 Total = $160B -- 92% secured 11 9 % of total Mortgages 74% Lines of Credit Personal Loans Credit Cards** 13% 7% 6% PCL Q1/09 Q2/09 Q1/09 Q2/09 Q1/09 $mm 2 2 24 22 59 Q2/09 67 Q1/09 37 Q2/09 35 % of avg. 1 1 49 45 210 241 161 158 loans (bps) * before securitizations of $19 billion 48 ** includes $6 billion of Scotialine VISA#25Scotiabank (Outstandings at Q2/09, $ billions) 11.4 International Retail Loans and Provisions 3.4 1.0 Personal Loans (total = $7.1B) I Credit Cards (total = $2.2 B) ■Mortgages (total = $ 13.7 B) 5.2 1.4 4.0 7.0 0.5 1.1 2.4 0.1 3.3 1.2 2.8 0.6 0.6 C&CA* Mexico Chile Peru % of total 50% 23% 17% 10% PCL Q1/09 Q2/09 Q1/09 Q2/09 Q1/09 Q2/09 Q1/09 Q2/09 $mm 26 33 58 38 18 15 28 39 % of avg. loans (bps) 100 120 439 302 192 154 495 654 Caribbean and Central America Total Portfolio = $23B -- 76% secured Scotiabank 49 Bank-Sponsored Multi-Seller Conduits (Q2/09, $ billions) Funded assets Weighted-average: rating (equivalent) life (years) Canadian Conduits U.S. Conduit 2.5 (Q1/09: 3.4) 5.6 (Q1/09: 7.3) AA- or higher 74% A or higher 1.1 1.4 Volume down 24% vs. last quarter Assets mostly receivables auto loans/leases: 44%, trade: 22%, equipment loans: 12%, diversified ABS: 11% ☐ No direct CDO or CLO exposure 50#26Scotiabank One-Day VaR ($ millions) 40 30 20 10 0 (10) (20) (30) (40) February 1, 2009 to April 30, 2009 - Actual P&L 1 day VaR кримим Scotiabank Average one-day VaR: $16.0mm in Q2/09 vs $21.7mm in Q1/09 # days 6 2 O 51 Trading Revenue Q2/09 Trading Revenue ($ millions) (6) (5) (4) (3) (2) (1) 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 ■ 86% days had positive results in Q2/09 vs 87% in Q1/09 52