TD Bank 2014 Annual Report Download - page 56

TD BANK GROUP ANNUAL REPORT 2014 MANAGEMENT’S DISCUSSION AND ANALYSIS54
(millions of Canadian dollars) As at
Loans and Commitments
Direct1 Indirect2 Total
Country October 31, 2014
GIIPS
Greece $ – $ – $ –
Italy 233 4 237
Ireland – – –
Portugal – – –
Spain 18 88 106
Total GIIPS 251 92 343
Rest of Europe
France 190 419 609
Germany 672 915 1,587
Netherlands 506 482 988
Sweden 173 4 177
Switzerland 353 699 1,052
United Kingdom 1,872 1,624 3,496
Other3 158 155 313
Rest of Europe 3,924 4,298 8,222
Total Europe $ 4,175 $ 4,390 $ 8,565
October 31, 2013
GIIPS
Greece $ – $ – $ –
Italy 122 1 123
Ireland – – –
Portugal – – –
Spain 63 100 163
Total GIIPS 185 101 286
Rest of Europe
France 23 461 484
Germany 405 895 1,300
Netherlands 395 584 979
Sweden 120 4 124
Switzerland 270 603 873
United Kingdom 7,703 1,365 9,068
Other3 189 116 305
Rest of Europe 9,105 4,028 13,133
Total Europe $ 9,290 $ 4,129 $ 13,419
EXPOSURE TO EUROPE – Gross European Lending Exposure by Country
TABLE 38
1 Includes interest-bearing deposits with banks, funded loans, and
banker’s acceptances.
2 Includes undrawn commitments and letters of credit.
3 Other European exposure is distributed across 12 countries (October 31, 2013 –
13 countries), each of which has a net exposure including Loans and Commit-
ments, Derivatives, Repos and Securities Lending, and Trading and Investment
Portfolio below $1.0 billion as at October 31, 2014, and October 31, 2013.
Of the Bank’s European exposure, approximately 97%
(October 31, 2013 – 98%) is to counterparties in countries
rated AAA/AA+ by either Moody’s Investor Services (Moody’s) or
Standard & Poor’s (S&P), with the majority of this exposure to the
sovereigns themselves and to well rated, systemically important banks
in these countries. Derivatives and securities repurchase transactions
are completed on a collateralized basis. The vast majority of derivatives
exposure is offset by cash collateral while the repurchase transactions
are backed largely by government securities rated AA- or better by
either Moody’s or S&P, and cash. The Bank also takes a limited amount
of exposure to well rated corporate issuers in Europe where the Bank
also does business with their related entities in North America.
In addition to the European exposure identified above, the Bank
also has $5.2 billion (October 31, 2013 – $4.9 billion) of direct expo-
sure to supranational entities with European sponsorship and indirect
exposure including $1.9 billion (October 31, 2013 – $791 million)
of European collateral from non-European counterparties related to
repurchase and securities lending transactions that are margined daily,
and $11 million (October 31, 2013 – $7 million) invested in European
diversified investment funds.
As part of the Bank’s usual credit risk and exposure monitoring
processes, all exposures are reviewed on a regular basis. European
exposures are reviewed monthly or more frequently as circumstances
dictate and are periodically stress tested to identify and understand
any potential vulnerabilities. Based on the most recent reviews, all
European exposures are considered manageable.