TD Bank 2001 Annual Report Download - page 35

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33
HOW WE PERFORMED IN 2001
MANAGEMENT’S DISCUSSION AND ANALYSIS OF OPERATING PERFORMANCE
TABLE 3 Analysis of change in net interest income (TEB)
(millions of dollars) 2001 vs. 2000 2000 vs. 1999
Favourable (unfavourable) Favourable (unfavourable)
due to change in due to change in
Average Average Net Average Average Net
volume rate change volume rate change
Total earning assets $ 908 $ (66) $ 842 $ 2,956 $ (148) $ 2,808
Total interest-bearing liabilities (710) 700 (10) (2,053) (124) (2,177)
Net interest income $ 198 $ 634 $ 832 $ 903 $ (272) $ 631
TABLE 4 Net interest rate margin (TEB)
(millions of dollars) 2001 2000 1999
Average Net Average Net Average Net
earning interest earning interest earning interest
assets income Margin assets income Margin assets income Margin
Canada $147,525 $ 3,628 2.46% $133,116 $ 3,137 2.36% $100,814 $ 2,459 2.44%
United States 55,798 509 .91 53,371 458 .86 47,472 484 1.02
Other international 50,128 499 1.00 47,534 209 .44 37,861 230 .61
Total Bank $253,451 $ 4,636 1.83% $234,021 $ 3,804 1.63% $186,147 $ 3,173 1.70%
TABLE 2 Operating cash basis measurements1
2001 2000 1999
Operating cash basis earnings per common share $ 3.31 $ 3.16 $ 2.39
Adjustments for non-cash/special items:
Amortization of goodwill, net of tax (.30) (.21) (.07)
Amortization of intangible assets from business combinations, net of tax (.70) (.95) –
Gains on sale of investment real estate, net of tax .44 ––
Increase in general provision, net of tax (.33) ––
Restructuring costs, net of tax (.23) (.44) –
Income tax expense from income tax rate changes2(.12) ––
Special gains, net of tax ––2.58
Earnings per common share – consolidated statement of income $ 2.07 $ 1.56 $ 4.90
Return on common shareholders’ equity
Operating cash basis net income applicable to common shares $ 2,075 $ 1,962 $ 1,429
Average common shareholders’ equity 11,505 10,894 8,576
Operating cash basis return on common shareholders’ equity 18.0% 18.0% 16.7%
1Operating cash basis results exclude restructuring costs related to
acquisitions and significant business restructuring initiatives (TD
Securities in 2001, TD Waterhouse Group, Inc. in 2001, the acquisition
of Newcrest in 2001 and the acquisition of Canada Trust in 2000),
the effects of future tax rate reductions on future tax balances in 2001,
the net effect of real estate gains and general provision increases in
2001 and the gain on the sale of TD Waterhouse Group, Inc. and
Knight/Trimark in 1999. Operating results are presented on this basis
in order to provide a meaningful year-over-year comparison. Cash basis
results exclude the after-tax impact of goodwill and other purchase-
related intangible amortization. As explained, operating cash basis
results are different from reported results determined in accordance
with generally accepted accounting principles (GAAP). The term “oper-
ating cash basis results” is not a defined term under GAAP, and there-
fore may not be comparable to similar terms used by other issuers.
2Tax rate reductions cause a writedown of future tax assets.