Embracing Fintech
Interest Rate Sensitivity
POLICY RATE CHANGE AND OUTLOOK
Change During
BNS Fiscal Quarters (bps)
Expected
Increase (bps)
QTD
Current
Policy
from Current
BNS
Forecast
Policy Rate
Policy Rate to
at
Country
Canada
Q1/22
-
Q2/22
+75
Q3/22 Q4/222
Rate
Dec 31/223
Dec 31/223
+150
-
2.50%
+100
3.50%
US
-
+25
+200
-
2.50%
+75
3.25%
Mexico
+75
+100
+125
+75
8.50%
+150
10.00%
Colombia +150
+200
+300
9.00%
+50
9.50%
Peru
+150
+150
+150
+50
6.50%
6.50%
Chile
+275
+150
+275
9.75%
+125
11.00%
NET INTEREST INCOME SENSITIVITY
An immediate and sustained +100 bps or -100 bps
parallel shift would have an impact on annual net
interest income of -$267 million or +$231 million
for year 1, respectively
Above estimates assume a static balance sheet
and no management actions¹
EVOLUTION OF INTEREST RATES²
Canada & U.S. (%) 2
Mexico & Chile (%)
4.0
12.0
3.5
10.0
3.0
8.0
2.5
2.0
6.0
1.5
4.0
1.0
2.0
0.5
0.0
0.0
Jul-19
Jan-20
Jul-20
Jan-21
Jul-21
Jan-22
Jul-22
Jul-19
Jan-20
Jul-20
Bank of Mexico Overnight Rate
BoC Overnight Rate
Fed Funds Rate
CAD 5-Yr Swap Rate
USD 5-Yr Swap Rate
Jan-21
Jul-21
Jan-22
Jul-22
MXN 5-Yr Swap Rate
Bank of Chile Monetary Policy Rate
CLP 5-Yr Swap Rate
1 Additional detail regarding non-trading interest rate sensitivity can be found on page 36 of the Management's Discussion & Analysis in the Bank's Third Quarter 2022
Report to Shareholders, available on http://www.sedar.com
2 As of Aug 18, 2022
3 Source: Scotia Economics. US and Canada as at July 18, 2022 forecast, Pacific Alliance countries as at July 29, 2022 forecast
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