TD Bank 2010 Annual Report Download - page 50

TD BANK GROUP ANNUAL REPORT 2010 MANAGEMENT’S DISCUSSION AND ANALYSIS48
(millions of Canadian dollars, except as noted) Percentage of total
2010 2009 2008 2010 2009 2008
Canada
Atlantic provinces $ 29 $ 25 $ 21 1.8% 1.0% 2.0%
British Columbia1 71 68 44 4.4 2.7 4.1
Ontario1 716 824 526 44.0 33.2 49.5
Prairies1 81 78 43 5.0 3.2 4.0
Québec 81 69 52 5.0 2.8 4.9
Total Canada2 978 1,064 686 60.2 42.9 64.5
United States
Florida 13 41 4 0.8 1.7 0.4
New England3 251 141 42 15.4 5.7 4.0
New Jersey 124 110 64 7.6 4.4 6.0
New York 76 142 57 4.7 5.7 5.4
Pennsylvania 65 44 16 4.0 1.8 1.5
Others 93 25 65 5.7 1.0 6.1
Total United States2 622 503 248 38.2 20.3 23.4
International
Other (2) 3 – (0.1) 0.1 –
Total international (2) 3 – (0.1) 0.1 –
Total excluding other loans 1,598 1,570 934 98.3 63.3 87.9
Other loans 128 44 – 7.9 1.8 –
Total specific provision 1,726 1,614 934 106.2 65.1 87.9
General provision (101) 866 129 (6.2) 34.9 12.1
Total provision for credit losses $ 1,625 $ 2,480 $ 1,063 100.0% 100.0% 100.0%
Provision for credit losses as a % of average net loans and acceptances4
Canada
Residential mortgages 0.01% 0.01% 0.02%
Credit card, consumer instalment and other personal 0.94 1.11 0.88
Business & government 0.28 0.40 0.17
Total Canada 0.51 0.61 0.41
United States
Residential mortgages 0.24 0.27 0.32
Credit card, consumer instalment and other personal 1.65 1.37 0.76
Business & government 1.01 0.68 0.59
Total United States 1.05 0.79 0.61
International (0.05) 0.05 –
Total excluding other loans 0.63 0.65 0.44
Other loans 1.31 0.35 –
Total specific provision 0.66 0.63 0.44
General provision
Personal, business & government – 0.27 0.06
Debt securities classified as loans5 (1.08) 1.63 –
FDIC covered loans6 – – –
Total provision for credit losses as a % of
average net loans and acceptances 0.62% 0.97% 0.50%
PROVISION FOR CREDIT LOSSES BY GEOGRAPHY
TABLE 31
1 The territories are included as follows: Yukon is included in British Columbia;
Nunavut is included in Ontario; and Northwest Territories is included in the
Prairies region.
2
Includes trading loans that the Bank intends to sell immediately or in the near term
with a fair value of $188 million (2009 – $140 million) and amortized cost of
$188 million (2009 – $142 million), and loans designated as trading under the fair
value option of $85 million (2009 – $210 million) and amortized cost of $86 million
(2009 – $226 million). No allowance is recorded for trading loans or loans designated
as trading under the fair value option.
Non-Prime Loans
As at October 31, 2010, the Bank had approximately $1.8 billion (2009 –
$1.5 billion) gross exposure to non-prime loans, which primarily consists
of automotive loans originated in Canada. The credit loss rate, which
is an indicator of credit quality and is defined as the average PCL
divided by the average month-end loan balance, was approximately 5%
(2009 – approximately 6.0%) on an annual basis. The portfolio continues
to perform as expected. These loans are recorded at amortized cost.
See Note 3 to the Consolidated Financial Statements for further infor-
mation regarding the accounting for loans and related credit losses.
3 The states included in New England are as follows: Connecticut, Maine,
Massachusetts, New Hampshire, and Vermont.
4
Includes customers’ liability under acceptances.
5
As a result of the 2009 Amendments to CICA Handbook Section 3855, certain
available-for-sale and held-to-maturity securities were reclassified to loans.
6
Loans subject to the loss share agreements with the FDIC are considered “FDIC
covered loans”. The credit losses related to FDIC covered loans are determined
net of the amount expected to be reimbursed by the FDIC.