Q1 2010 Scotiabank Risk Review and Outlook

International Banking: Earning Through Challenges 388 - Net Income ($ millions) 283 294 Q1/09 Q4/09 Q1/10 - Q1/10 vs. Q4/09 Revenues up 10% + Positive impact of FI & higher securities gains - Writedown on investment in Venezuelan affiliate PCLs up $10MM, significantly higher tax rate + Expenses down 5% + Release of legal provision in Peru + Lower advertising & professional fees Q1/10 vs. Q1/09 + Revenues down 3%, up 8% ex. FX - + Positive impact of FI & acquisitions + Higher securities gains, widespread transaction driven growth - $32MM writedown on investment in Venezuelan affiliate PCLs up $61MM, significantly higher tax rate + Expenses down 9%, down 1% ex. FX + Release of legal provision in Peru Scotiabank - Higher stock based compensation Scotia Capital: Strong & Diversified Revenues, Lower Loan Losses Net Income ($ millions) 353 300 381 Q1/09 Q4/09 Q1/10 Q1/10 vs. Q4/09 Revenues down 1% Strong credit fees, but down vs. record Q4 + Higher trading revenues + PCLs down $49MM Expenses up 8% - Higher performance-based compensation, salaries & technology costs + Lower legal provisions Q1/10 vs. Q1/09 + Revenues up 28% - +2nd best trading quarter ever + Higher loan origination & credit fees + Wider spreads Reduced loan volumes PCLs up $4MM Expenses up 6% Higher performance-based compensation Scotiabank 11 12

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