Scotiabank First Quarter Press Release 2023
The allowance on impaired loans increased to $1,654 million from $1,635 million last quarter. The allowance for impaired loans
ratio was 21 basis points, unchanged from the prior quarter.
Impaired loans
Gross impaired loans increased to $5,104 million as at January 31, 2023, from $4,786 million last quarter. The increase was due
primarily to the impact of foreign currency translation and new formations in retail and Canadian commercial portfolios. The
gross impaired loan ratio was 65 basis points as at January 31, 2023, an increase of three basis points from last quarter.
Net impaired loans in Canadian Banking were $667 million as at January 31, 2023, an increase of $165 million from last
quarter, due primarily to higher retail and commercial formations. International Banking's net impaired loans were $2,650
million as at January 31, 2023, an increase of $140 million from last quarter, due primarily to the impact of foreign currency
translation and net formations in retail portfolio. In Global Banking and Markets, net impaired loans were $120 million as at
January 31, 2023, a decrease of $8 million from last quarter, due primarily to lower formations. In Global Wealth Management,
net impaired loans were $13 million as at January 31, 2023, an increase of $2 million from last quarter. Net impaired loans as a
percentage of loans and acceptances were 0.44% as at January 31, 2023, an increase of three basis point from 0.41% last
quarter.
Capital Ratios
The Bank's Common Equity Tier 1 (CET1) capital ratio (1) was 11.5% as at January 31, 2023, unchanged from the prior quarter, as
internal capital generation and gains from the revaluation of FVOCI securities were offset by organic growth in risk-weighted
assets across all business lines and the impact of the Canada Recovery Dividend (CRD).
The Bank's Tier 1 capital ratio (1) was 13.2% as at January 31, 2023, approximately in line with the prior quarter, due primarily to
the above noted impacts to the CET1 ratio.
The Bank's Total capital ratio (1) was 15.2% as at January 31, 2023, a decrease of approximately 10 basis points from the prior
quarter, mainly due to the above noted impacts to the Tier 1 capital ratio.
The Leverage ratio (2) was 4.2% as at January 31, 2023 and also remained in line with the prior quarter, due primarily to higher
Tier 1 capital offset by strong growth in the Bank's on and off-balance sheet assets.
The TLAC ratio (3) was 27.9% as at January 31, 2023, an increase of approximately 50 basis points from the prior quarter,
mainly from higher TLAC instruments partly offset by the above noted impacts to the Total capital ratio.
The TLAC Leverage ratio (3) was 8.9%, an increase of approximately 10 basis points, due primarily to higher TLAC instruments
partly offset by the growth in leverage exposures.
As at January 31, 2023, the CET1, Tier 1, Total capital, Leverage, TLAC and TLAC Leverage ratios were well above OSFI's
minimum capital ratios.
(1) This measure has been disclosed in this document in accordance with OSFI Guideline - Capital Adequacy Requirements (November 2018).
(2) This measure has been disclosed in this document in accordance with OSFI Guideline - Leverage Requirements (November 2018).
(3) This measure has been disclosed in this document in accordance with OSFI Guideline - Total Loss Absorbing Capacity (September 2018).
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