TD Bank 2014 Annual Report Download - page 210

TD BANK GROUP ANNUAL REPORT 2014 FINANCIAL RESULTS208
Interest Rate Risk by Category
(billions of Canadian dollars) As at
October 31, 2014
Total Over 1 Non-
Floating Within 3 months within year to Over interest
rate 3 months to 1 year 1 year 5 years 5 years sensitive Total
Canadian currency $ (186.1) $ 109.7 $ 25.5 $ (50.9) $ 103.2 $ 9.9 $ (49.5) $ 12.7
Foreign currency (19.1) 27.7 26.0 34.6 55.0 44.8 (147.1) (12.7)
Net position $ (205.2) $ 137.4 $ 51.5 $ (16.3) $ 158.2 $ 54.7 $ (196.6) $ –
October 31, 2013
Canadian currency $ (177.4) $ 110.7 $ 11.8 $ (54.9) $ 95.2 $ 10.4 $ (40.3) $ 10.4
Foreign currency (32.2) 40.7 13.9 22.4 48.2 35.9 (116.9) (10.4)
Net position $ (209.6) $ 151.4 $ 25.7 $ (32.5) $ 143.4 $ 46.3 $ (157.2) $ –
Concentration of Credit Risk
(billions of Canadian dollars, except as noted) As at
Loans and customers’ liability Derivative financial
under acceptances1
Credit instruments2,3
instruments4,5
October 31 October 31 October 31 October 31 October 31 October 31
2014 2013 2014 2013 2014 2013
Canada 72% 74% 48% 50% 34% 39%
United States6 27 25 48 46 23 19
United Kingdom – – 1 1 18 15
Europe – other – – 2 2 18 20
Other international 1 1 1 1 7 7
Total 100% 100% 100% 100% 100% 100%
$ 492 $ 451 $ 119 $ 106 $ 53 $ 48
CREDIT RISK
NOTE 33
Concentration of credit risk exists where a number of borrowers or
counterparties are engaged in similar activities, are located in the
same geographic area or have comparable economic characteristics.
Their ability to meet contractual obligations may be similarly affected
by changing economic, political or other conditions. The Bank’s
portfolio could be sensitive to changing conditions in particular
geographic regions.
1
Of the total loans and customers’ liability under acceptances, the only industry
segment which equalled or exceeded 5% of the total concentration as at October
31, 2014, was: real estate 9% (October 31, 2013 – 8%).
2
As at October 31, 2014, the Bank had commitments and contingent liability
contracts in the amount of $119 billion (October 31, 2013 – $106 billion). Included
are commitments to extend credit totalling $100 billion (October 31, 2013 –
$89 billion), of which the credit risk is dispersed as detailed in the table above.
3
Of the commitments to extend credit, industry segments which equalled or
exceeded 5% of the total concentration were as follows as at October 31, 2014:
financial institutions 17% (October 31, 2013 – 17%); pipelines, oil and gas 9%
(October 31, 2013 – 10%); power and utilities 9% (October 31, 2013 – 8%);
government, public sector entities, and education 8% (October 31, 2013 – 7%);
sundry manufacturing and wholesale 7% (October 31, 2013 – 7%); automotive
6% (October 31, 2013 – 7%); telecommunications, cable, and media 6% (Octo-
ber 31, 2013 – 7%); professional and other services 5% (October 31, 2013 – 4%).
4
As at October 31, 2014, the current replacement cost of derivative financial instru-
ments amounted to $53 billion (October 31, 2013 – $48 billion). Based on the
location of the ultimate counterparty, the credit risk was allocated as detailed in
the table above. The table excludes the fair value of exchange traded derivatives.
5
The largest concentration by counterparty type was with financial institutions
(including non-banking financial institutions), which accounted for 85% of the
total as at October 31, 2014 (October 31, 2013 – 83%). The second largest
concentration was with governments, which accounted for 11% of the total
as at October 31, 2014 (October 31, 2013 – 12%). No other industry segment
exceeded 5% of the total.
6
Debt securities classified as loans were 1% as at October 31, 2014 (October 31,
2013 – 1%) of the total loans and customers’ liability under acceptances.