Consistent Earnings Growth and Digital Engagement
Endnotes
TD
131.Pre-tax, pre-provision earnings (PTPP) is a non-GAAP financial measure that is typically calculated by subtracting expenses from revenues. At
the total Bank level, TD calculates PTPP as the difference between adjusted revenue (U.S. Retail in $US) net of fair value changes in
investments supporting insurance claims liabilities, and adjusted expenses (U.S. Retail in $US), grossed up by the retailer program partners'
share of PCL for the Bank's U.S. strategic card portfolio. Collectively, these adjustments provide a measure of PTPP that management believes
is more reflective of underlying business performance.
132.Operating leverage is a non-GAAP ratio that is typically calculated by dividing revenue growth by expense growth. At the total bank level, TD
calculates operating leverage as the difference between the % change in adjusted revenue (U.S. Retail in source currency) net of fair value
changes in investments supporting insurance claims liabilities, and the % change in adjusted expenses (U.S. Retail in source currency) grossed
up by the retailer program partners' share of PCL for the Bank's U.S. strategic card portfolio. Collectively, these adjustments provide a measure
of operating leverage that management believes is more reflective of underlying business performance.
133. Adjusts for the impact of foreign exchange on the U.S. Retail Bank by using source currency figures. These adjustments are done to reflect
measures that the Bank believes are more reflective of underlying business performance.
134.Fiscal 2022 U.S. Retail reported revenues included acquisition and integration-related charges for the First Horizon acquisition of C$114 million
pre-tax and a litigation settlement recovery of C$224 million pre-tax which were reported as items of note
135. For quarters ended October 31, 2022 and July 31, 2022: U.S. Retail reported expenses included acquisition and integration-related charges for
the First Horizon acquisition (pre-tax) of C$85 million and C$29 million, respectively, which were reported as items of note.
136.Adjusts for fair value changes in investments supporting insurance claims liabilities, as reported on page 6, line 14 of the Bank's Q4 2022
Supplementary Financial Information package (Income (loss) from Financial Instruments designated at FVTPL - Related to Insurance
Subsidiaries).
137.Adjusts for the impact of the accounting requirements for the U.S. strategic card portfolio. Eliminating the partners' share of the PCL removes a
source of volatility that is not reflective of the Bank's underlying economic exposure. This can be done by adding Corporate PCL (which consists
solely of the partners' share of the PCL) back to non-interest expenses.
138.Line 12 metrics reflect the adjustments described in lines 8 through 11 on slide 28.
139. Line 13 metrics reflect the adjustments described in lines 9 through 12 on slide 64.
140.Excluding only the impact of the US Strategic Card Portfolio partners' share, year-over year expense growth would have been 7.8% ($22,795MM
in FY 2021 and $24,562MM in FY 2022, representing a year-over-year increase of $1,767MM).
141.Excluding only the impact of the US Strategic Card Portfolio partners' share, year-over year expense growth would have been 11.8% ($5,875MM
in Q4 2021 and $6,567MM in Q4 2022, representing a year-over-year increase of $692MM).
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