TD Bank 2006 Annual Report Download - page 23

Download and view the complete annual report

Please find page 23 of the 2006 TD Bank annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 130

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130

TD BANK FINANCIAL GROUP ANNUAL REPORT 2006 Management’s Discussion and Analysis 19
(millions of Canadian dollars) 2006 vs 2005
2006 2005 2004 % change
Net interest income $(65) $457 $1,037 (114.2)%
Other income 797 147 (153) 442.2
Total trading-related income $732 $604 $ 884 21.2%
By product
Interest rate and credit portfolios $362 $ 370 $ 559 (2.2)%
Foreign exchange portfolios 306 248 230 23.4
Equity and other portfolios 64 (14) 95 557.1
Total trading-related income $732 $604 $ 884 21.2%
Trading-related revenues as a percentage of total revenues 5.6% 5.1% 8.3%
1Trading-related income includes both trading income reported in
other income and net interest income derived from trading instruments.
TRADING-RELATED INCOME1
TABLE 8
(millions of Canadian dollars) 2006 vs 2005
2006 2005 2004 % change
Investment and securities services:
Discount brokerage $544 $866 $ 985 (37.2)%
Securities and full service brokerage 988 927 738 6.6
Mutual funds 639 624 573 2.4
Credit fees 371 343 343 8.2
Net investment securities gains 305 242 192 26.0
Trading income (loss) 797 147 (153) 442.2
Service charges 937 787 673 19.1
Loan securitizations 346 414 390 (16.4)
Card services 383 279 172 37.3
Insurance, net of claims 896 826 593 8.5
Trust fees 130 111 78 17.1
Other 397 323 299 22.9
Total $ 6,733 $5,889 $4,883 14.3%
TRADING-RELATED INCOME
Trading-related income, which is the total of net interest
income on trading positions and trading income reported in
other income, increased by $128 million, or 21%, from 2005.
The increase was a result of a $153 million loss incurred in 2005
due to a reduction in the estimated value and exit of certain
structured derivatives portfolios. Excluding this item, underlying
trading-related income was down marginally, as improved results
from foreign exchange trading were offset by weaker results
from the interest rate and credit portfolios.
The mix of trading-related income between net interest
income and trading income reported in other income is largely
dependent upon levels of interest rates, which drives the funding
costs of our trading portfolios. Generally, as interest rates rise,
net interest income declines and trading income reported in
other income increases. Management believes that the total
trading-related income is the appropriate measure of trading
performance.
OTHER INCOME
TABLE 7