International Banking - Annual Overview

INTERNATIONAL BANKING - QUARTERLY Solid volume growth and positive operating leverage FINANCIAL PERFORMANCE AND METRICS¹ ($MM) Q4/17 Y/Y Q/Q Revenue $2,565 +3% -3% Expenses $1,395 -1% -3% PCLS $310 +5% -5% Net Income $605 +11% -1% • Productivity Ratio 54.4% -210bps -10bps Net Interest Margin 4.67% -10bps -10bps · PCL Ratio 1.14% -1bps -2bps NET INCOME¹ ($MM) AND NIM (%) 4.77% 4.73% 5.00% 4.77% 4.67% . 547 576 595 614 605 • YEAR-OVER-YEAR HIGHLIGHTS Net Income up 11% or 8%² 。 Strong asset and deposit growth 。 Good expense control 。 Lower tax benefits and lower contribution from affiliates Loans up 7% or 10%² 。 Latin America loan growth up 15%² Y/Y Deposits up 7% or 11%² NIM down 10 bps 。 Changes in business mix, including strong commercial loan growth 。 Lower net inflation impacts PCL ratio improved by 1 bp Expenses down 1% or up 2%² 。 Volume growth and inflation o Higher investments in digital and technology 。 Offset by savings from cost reduction initiatives and foreign currency translation Operating leverage of +3.3% for the year Q4/16 Q1/17 Q2/17 Q3/17 Q4/17 1 Attributable to equity holders of the Bank 2 Adjusting for foreign currency translation Scotiabank® 25

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