BNS - Earnings call transcript Q3 2018 | The Bank of Nova Scotia

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Operator

Good morning, and welcome to Scotiabank's 2018 Third Quarter Results Presentation. My name is Phil Smith, Senior Vice President of Investor Relations. Presenting to you this morning is Brian Porter, Scotiabank's President and Chief Executive Officer; Raj Viswanathan, our acting Chief Financial Officer and Daniel Moore, our Chief Risk Officer.

Following our comments, we will be glad to take your questions. Also present to take questions are Scotiabank's business line group heads: James O'Sullivan from Canadian Banking; Nacho Deschamps from International Banking; and Dieter Jentsch from Global Banking and Markets.

statements. on to those presentation, Slide Scotiabank's regarding and will today, which start caution you refer X forward-looking we behalf speaking of I contains Before of our call With over that, now I turn to Porter. will Brian the

Brian Porter

I'll Thank X. on morning, Slide start you, good Phil, and everyone.

quarter earnings adjusted basis, pleased third for results. an X% per adjusted The while positive in income are of related on was cost, to year-to-date compared our quarter our up We to from acquisition up equity And results Diluted X% which year. billion, was net $X.X share to shareholders. report last included XX.X%. we X.X%. was have On $X.XX last return operating year, leverage was

management leverage. target, of broad up driven business Turning which Banking’s track and also Results or Canadian and quality were year-to-date asset $X.X based achieve cost is credit banking, year-over-year. finance mortgages. to reflect margin commercial business better. delivering billion, ratio XX% credit Canadian quarter the X% productivity productivity its and by Strong lines, led Banking improving banking growth to by performed auto results small expansion, this positive improved cards, up on earnings well, and operating Canadian

and up In earnings in XX% addition, primary earnings, year-over-year quarter in another leverage. and is by Tangerine. Pacific earnings on International positive delivered the credit adjusted customer quality made driven both growth growing good progress being relationships Banking and Alliance, strong loans operating in Scotiabank of with solid double-digit very

which operating our with in and last XX% strong period very XX% businesses, in grew improving has products. improving growth, demand This XXX positive and positive performance quarter, earnings deliver growth Mexico XX% operating and the reflecting and line Overall to basis from the was market ratio leverage commercial winning our banking Revenues was is XX% financial continued improving to points. generate this all of strong personal years, again leverage that ROE. trend share, in efficiency two Scotiabank’s Our year-over-year Mexico and been strong across return-on-equity. economic

Our market comments enhance and growth in the scale and our consistent recent will some Global a earnings. additional in recent deliver as high earnings quality acquisitions moment. and acquisitions Markets continued key will quality. well provide markets, on increase I as bank’s share to Banking

net This quarter increases the we was improved enterprise XX.X% and strong credit leverage. operating productivity to marked generated the ratio by quality. income in At improving interest XX% adjusted and year-to-date from level,

and well across invest talented efforts process we operations sales digital perspective, are an seeing in and we From are our continue footprint. digital improvement Our progressing increasing to people. and adoption momentum technology, in

the are our are confident Investing while achieving deploy fiscal technology and this meet reflects our acquisitions, Our with contact a capital our point, financial a execution sales customer maintaining performance sales will medium with the summary, digital continue greater gains key performance than this productivity XX to banks organically In operations on through strategy, adoption strong quarter’s focus to growing ratios. strong million drive we to channel grow to in customer as increase and annually. interactions centers experience, our scale and of the capital and more and markets. objectives. ongoing strategic enhance At strategically XXXX term in

and grow transactions. acquisitions billion approximately an The provide like the significantly capital to deployed this scale banks of markets, that will mix. X has opportunity I’d business overview Turning key earnings a to or for enhance this in take in committed to improve moment, year bank recent our

for net high with us allow money worth It and Financial products in across our Medical Under Financial with and used banks the expansion operations, investment existing Fraser MD will creates of Scotiabank the contribute to be Agreement franchise Association, both management their capability. Fraser base. business also acquisitions management. primary strengthens exclusive financial Canada. counsel also private members to our need. attractive largest the grow and Affinity positive will a under We footprint. impact products The wealth sophisticated income our assets clients the which the the become -- acquisition employees, earnings net fee to Jarislowsky sell worth Fraser and Combined will Canadian nearly will medical quality. of platform the Jarislowsky XXX,XXX provider bank's financial like community Jarislowsky to further physicians, of institutional customer The grow family high will two continue MD additional with

key are our times, many a As the Alliance said strategy. Pacific of we part countries

and generated This consumer Republic, on country they which of of the Citibank’s and as Banco efforts. on million the establishes earnings scale small and our strengthening in Colombia quarter, management focused Scotiabank scale we nearly decade. Dominicano GDP The announced further Banco in integration This a largest now have is bank in Dominican Peru. over acquisition operation private BBVA Progreso the More our business doubles in our also for we Chile, basis, del $XXX are acquisitions an acquisition country. recently, past adjusted has Cencosud, third X% of team annually the and experienced through growth

are proceeding we accretion integrating excluding $X.XX in costs XXXX, of ratio to guidance We are experienced our to ahead to date, we discuss approximately and standpoint, integration over XXXX. fiscal turn I capital expect prior of BBVA at now an call reach financial better per or will Chile to our schedule. committed to is by the common performance. equity of EPS, Raj our businesses adjusted the acquisition share early X XX% fiscal and tier From

Raj Viswanathan

slide key basis, $X.XX year-over-year. On by results year-over-year. earnings XXXX. our include related integration per X, X% excluding QX Day adjusted diluted cost $X.XX, required These share of X reported bank the which acquisition-related share as an financial performing acquired begin The was on of shows But Thanks, loans down acquisition assets Brian. costs. diluted for amortization our noted Brian the intangible for X% metrics and per earnings PCL are IFRS software. earlier, up seven, performance adjusted I’ll as on reported

in Taking ratio capital weighted Partly bank's Year-to-date and its results, advertising Banking development Our adjusted strong, lending provisions retail higher by basis year to in repurchases treasury margins support offset asset income real down ratio now basis $X.XX as bank operating X.X%. offsetting year core a year was expected points strong the dividend and from and impaired the of remain improved market the exchange, banking and year XX business XX.X%, X% well This equity card personal and quarter-over-quarter margins The impact ratio our are XX.X%, to and net on XX% taxes early loan productivity account basis, X% foreign initiatives. credit brokerage by growth fees, and solid, ratio from on other year an growth, trading Non-interest portfolios of year-over-year business from of XX per to divestiture exchange margin the the The adjusted announced in over to Revenues liability to basis decrease our net XXX due These approximately interest productivity basis. and increase reported leverage collective and fiscal and reduction CETX banking on lower in net an an $X.XX the and higher a MD down expenses, business acquisitions banking PCL income Based quality up in our Canadian share strong and is solid Financial, by by the with of and option acquisitions the prior acquisition risk of The adjusted higher and of of on the ratio acquisitions. and as market partly partly basis The cost to an compared year-to-date points, divestiture and last an share lower management we to international was Slide reported quarter. these down from personal X% to increasing as driven regulatory share investments XX.X%. $XX Tier Global impact last internal quarters, technology, exercise. provide discussed year, adjusted common of business X% cost, segment. markets income growth. increased strong loans payment primarily performing growth. increased were weighted businesses evolution well CETX quarter. associated year. XX grew on shareholders impaired up offset XX close banking driven ratio primarily Capital quarterly completion provisions commercial represents securities banking last grow basis bank The reversal Banking gain, the Canadian levels Expenses as acquisitions non-core The down well risk million, and global higher prior basis year, over year. share. the we last current with banking and foreign very of generation, of revenue to assets. when of versus as to to PCL loans and and the in On of offset capital X commercial assets The X% X% prior as lower from as earnings on an income on were issuance in resulted offsetting our and XXXX. estate was and of activities. corporate lending, growth mortgages last businesses, last of divestitures based corporations. current assets core unchanged impact due the loans of a points common was the a initiatives, ratio There combined higher and over net international year-over-year coming was eight, Net business was due modest were impact the and total point points. is acquisitions of the primarily earlier. from net in

progress growth omni-channel the leverage banking X% line adjusted last changes was of on investments sequential performance current growth was growth basis quarter strong for which net in five HollisWealth net year-over-year. acceptances mortgages pace an year-over-year, primarily Canada to business Banking Turning year-over-year points up business leverage. on up X% grew rate was good Residential year. and gains of offsetting increases now estate credit of a year income improved of Provision $X.X lower X.X%. by adjusted due Revenues impact of continued on last year-over-year The estate These the continued points a driven X%, credit had results last interest strong year’s prior technology BXX income a year. XX.X% the mortgage last adjusted and year-over-year environment due and impact due and revenue Canadian to growth of X% net remained year-over-year And Residential by the basis real were results moderated. X%. modest non-interest compared on control and productivity acquisition strong acquisition card margin divisions X% the points real offset business The the growth rates, was of costs. X growth, year-to-date ratio were at interest use the in Partly for initiatives. with up earnings while slide X% and grow sale impact strong businesses positive initiatives of impact quarter-over-quarter. operating loans gains and to of higher our improved the and that basis regulations income a of Loans stronger net billion to divestiture year, by by adjusting regulatory mix. from our operating losses the also Lower nine. our of asset to related or The cost-reduction Expenses and of Bank XX%. down X X% year. the X% the from expansion, basis digital margin reflect impaired increased loan customers. year-over-year, remained mortgage support increased points X% reduced basis to credit beginning partially growth improved despite XXX and

grew Alliance asset reported strong follow growth are positive down growth. region X%, XX% Banking. which led Alliance a strong comments in net an interest XX% million next Revenues quality. Turning The currency increase was by and XX%, with were income Pacific points Alliance on Pacific for Loans the countries. Pacific in basis Net grew quarter impaired strong the a by on seven QX, down a had which the points basis loss margin $XXX by XX%. very slide year-over-year adjusted reflect year-over-year. compared ratio grew $XXX basis, year a up including a to the loan XX was leverage on primarily of year-over-year rates was loans year-over-year. million however, good of Pacific in adjusted credit strong basis. deposit constant X.X% due Columbia. credit exchanges provision of mix operating QX and lower and earnings up and International XX% to to in and Earnings a Alliance, XXXX results My The business ago,

were benefits X% by strong the points. leading growth, basis credit strong an adjusted reduction mark in ratio of technology as cost ratio the the points. six leverage up an Expenses the last Excluding higher basis volume partly a offset PCL on to XXX were improvement basis business of Operating an initiatives. of costs, adjusted inflation, benefits year-to-date, productivity positive approximately basis impact increased and the year, was X.X% on

year, higher $XXX the year-over-year, was underwriting by advisory down operating year-over-year Non-interest improved and income was turn Net adjustments. businesses impact to lower year-over-year, results offset the activities. driven were X% reflecting foreign segment basis and [ph] deposit volumes non-interest partly offset the was XX% was was income income up income. margin. driven pace improvement by and by Markets. was basis by on Net results result. provision and last X% and year-over-year. credit group units Moving year-over-year, in costs, the investment impact performance line in results an equities by account interest and moderated income from more partly slide lower of by Asia Trading interest mainly loans related compensation. corporate exchange fixed fixed revenues losses. lower banking due on on now of and and to X% well income in this one and last net fees than and Revenues commodities offset were primarily and slide with regulatory asset were liability and technology in lending treasury, will Global XX; United down as provision income, lower up rate by strong fee offset a the The points lower for Expenses down growth equities lower the favorable of loan corporate deposit growth higher and with equivalent revenue income, interest commodities XX, higher higher The to The of tax a as in net reversal line Banking million higher expectations. XX ratio business. smaller our on have of regulatory of our year-over-year, driven States of costs also other and include The incorporates improved I impaired year. management a certain PCL impact on provisions X% technology year-over-year,

will to now net investment Daniel, who partly was segment I of results. discuss of that $XXX management. The review financial to activities completes net it by due this other expenses. turn from risk management liability will a offset in loss This my million quarter. on lower segment non-interest this our lower now reported asset over contributions sale year-over-year increased of and lower gains The the loss securities

Daniel Moore

you, Raj. Thank

we profile. Turning fundamentals the now to are slide comfortable of risk XX, the with bank's

the on what points Our impaired referred the all-bank are and loan Overall, rates as basis basis International were businesses by X our same loan declined basis primarily in quarter book, retail is stable and credit seeing In in business, on PCL from points PCL loans, on performing was reversal Banking lower or from X and to to acquired basis and Stage ratio Segment quarter million the points XX we total Banking, basis net improvements declined in reflected X, banking driven credit Segment. last Banking last and mainly Day X Canadian and credit quality performing points, last International X losses in by a excluding the XX generally. quarter, loss impact our P&C year. points lower the driven $XX Considering Canadian ratio personal card impaired commercial versus loans provisions. loans

energy we In see and driven growth. losses volume diversification. International to in impaired quarter, [ph] the and loans provision U.S. impaired billion, impaired declined Banking, Banking were metrics, good with Global Higher mainly quality net the onto credit the continue the sector. formations benefits impaired of gross coverage ratio and by at the were in of Markets credit versus retail other while roughly generally remained average. below was at line $X reversals gross And loans year Moving stable looking last $XXX our two trends

portfolio home substantial loan-to-value average providing residential is and quality XX, portfolio buffer. slide and equity our to a XX% has lower high now the a mortgage of risk. of is XX% uninsured Turning uninsured

B continued quarter relative with declined to attribute Origination last of this volumes factors did of last quarter outlook reiterate other loan-to-value year-over-year as single to Overall, same rates. growth rising average of mid, as effect cumulative and some consistent digit remains we the the XX interest for it and reflect We such our originations mortgage but there levels. year. uninsured increase year. contributing quarter strong mortgage regulatory to are prior seasonality, other relative decline pipeline New this well an full XX% changes as the to the volume reflecting

of declined quarter loss from to XXX. points you slide loss Banking's now for last our points businesses. X quarter. impaired recent XXX versus each ratio see basis declined basis the trend to Banking's Canadian impaired over credit X in XX, points basis PCL Turning ratio the can International rates last

includes X potential increase portfolio in of more driven increased than a provision on Chile PCL Banking’s and the by impact point. performance portfolios in acquisition by credit by partially increases our the the the performing portfolio. were the in commercial one of quarter was modest Mexico. offset the continue -- by improvements Adjusting improvement portfolio our restructuring underlying basis in Caribbean the the and retail The acquisition believe Day The a provisions total obligations. the increase the remained PCL benefits offset As the retail strong. current for in ratio reflect we Barbados broad very related for diversification loans, to of International that Overall, on International

XX, see now the write-off in of to you can slide businesses. Turning our recent trend each net for rates

Looking we our stable X improvements been trend write-off due would in our that and decline primarily portfolio. ratio Canadian last has we year-over-year net In quarter, the relatively Banking, points over five to ratio have basis retail seen continue. expect to the

collection focus are the continued credit Specifically, our with provide delinquencies over and call back at lending us turn net card approximately I'll write-offs. our our allowances enhanced portfolios on lower our in remarks. and driving automotive to for customers closing coupled strategies, portfolio, up-tiering in unsecured in levels for credit now coverage X worth quarters Brian of our some

Brian Porter

– I’d I would some today’s to you, Thank from like our the bank. presentation highlight Daniel. key discuss for themes and now the outlook of now

several were will acquisitions, we to driving segments pleased to key help improving both been key of on Firstly, achieve us and quality execute able earnings scale and in greater growth while all to have our and diversification. which earnings markets

difficult a advantage in and partnerships, We’ve acquisitions. these before, position which to establishing to they of opportunities us building of put said ourselves I capital, successful As to timing by take when relationships control the themselves. it's be presented acquirer developing allowed a

acquisitions will platform Financials. management Fraser greatly from Jarislowsky wealth Our of MD benefit and the

businesses and private our doubles our acquisitions the the the in be As and bank's proportion in the and acquisition The result, third Colombia, of quality transactions Collectively, markets. benefit shareholders will Chile our enhance and quality in growth revenues. Peru these bank Chile, in enhance BBVA the a will the offering country high a to of key these presence our attractive of accretive recurring largest from earnings. higher scale while product creates

and efforts be we’ll integration the forward, acquisitions. focused execution of Going these on

and in our Secondly, technology, process generating improving improvement automation gains investment experience. productivity is good continued while customer simultaneously smart digital the

by of on You productivity an or can to our our XX% better well achieving in clearly this strong improvements XXXX. productivity see all ratio we and are bank goal way

to and the from over for provides of the growth. strong well Finally, grow our realize capital In full capital many for earnings. deploy the our taking platform are had to our steps we with shareholders. the enviable continue closing, earnings untapped potential will we optimality term of long and us to continue This diversified areas platform customers to generate further our potential and

of from to lead Raj, outlook will strong are so in the the with back environment economic We I doing key will positive all turn performance who now Q&A. a call an our markets.

Raj Viswanathan

That concludes one our prepared the rejoined pleased Thanks then We’ll Brian. questions. the first Operator, allow have question everyone to opportunity in to to the the can take we Please participate and phone to your the call. queue be remarks. on yourself question now please. limit

Operator

Thank you.

line Please Our Meny Securities. is first from question comes go ahead, open. from Cormark your Grauman

Meny Grauman

Hi, good morning.

business the needing that a more from this there a improve number is markets of just about something business that your capital you the the that are markets and perspective do just to in over the you you performance question need are Just in fundamental or taking and to function that case? that’s there are there wondering this of and the steps quarters, if a markets is just to address

Dieter Jentsch

and Dieter our practice its banking our less fall, Meny, were of performing our expectations businesses, speaking. markets business M&A will our you results shows be some is as that metals be per the see upturning our constructive and our business, We in also to in our corporate Day those so to on that conveyed underwriting lending numbers, sort lending it business fees one M&A you relying in relationships our and of on line. trading we the relying continued will in reflect the trading going also you realignment for advisory. the And that the focus the more fees, and see and that continue of book corporate and of financing we and enhancing interest at relationships can but that We moved our in of we’ve QX advisory [indiscernible] realign is side in and results, business do funding the overall on generally trading we in the said question. market and and those Thank net our in up Jentsch more but trading we are the credit rate source the can focus and anticipate Investor business, on

Meny Grauman

timeline realignment In expect terms of more businesses, see of the there of you of improvements? meaningful that some to trading kind what

Dieter Jentsch

on metal Well, side side we're softer the of through, as the this you halfway about market, pricing metals know. for the on and quarter in was course

so And we that stabilized coming in the has stream quarters. that anticipate revenue

while strengthen, through So in will halfway the [indiscernible] which we're realignment we will also anticipate commodity prices revenues.

we – up. stabilized and revenues coming we has So and enhanced more look quarter an forward we're the believe constructive to

Meny Grauman

Thank you.

Phil Smith

Operator, can we question have next please. the

Operator

next Young Our from question from comes Desjardins. Doug

from question next Barclays. John comes from Our Aiken

John Aiken

provisions Good except provided international terms that morning. showing the Daniel, in slide for XX, regions all Mexico. recovery were in and you performing on of

can on there to impact basis, actually the was we're on trying as magnitude U.S. ratified? impacts potential signed an give be give As between the the some us IFRS and order Mexico you a go performing? us of trade can well, driving out the X the as figure of would and of recoveries And agreement to forward flavor what what's if

Daniel Moore

you. Thank

performing and performance So, across Stage our driven IFRS strong We've mechanics as that's Chile to in Caribbean Mexico. move X out migration as a segment to function regarding and the credit particularly from of well X Colombia how Stage banking non-performing calling generally, Peru, our performing from X had some international quality by impacts. as it's they work loan in

after go growth international PCL The with should forward we're in overall our line from ratio an pleased in growth banking. very be outlook perspective. with So

North impact well to as impact see and as to progress days, add on on recent on is Ignacio Canadian, our obviously, but that. disclosure early the on NAFTA, to think the early continued from that. forward positive on that the Regarding forward pleased we that, the momentum perspective look to the footprint news anything both American Mexico we're we

Ignacio Deschamps

I loan solid. loans is quarter Mexico would a that XX%. growth very had stress our at growing Mexico very strong in

strong growing very agree and leverage that is positive And provisions operating earnings are very important it on a similar So the at Mexico. of particularly very agreement PCLs are strong the NAFTA I automobile are for this development, growing quarter. with a levels. preliminary that very

So the very the risk quarters reintroducing and strong reducing for and coming NAFTA for we Mexico delivering positive a election, geopolitical quarter both see very too. the Mexico,

John Aiken

guys. Thanks

Phil Smith

the Operator, please. can have next we question

Operator

Our Desjardins next Capital Markets. question comes from Doug Young from

Doug Young

morning. Good

it in Just your outlook your go and generation the as like the your and slide per XX back looks wanted risk-weighted quarter points, points. capital was basis was growth to to eight, assets internal capital basis slide capital XX

that's So that second within now I'm you get to quality increasing, I market increase acquisitions So book any is I context there risk closer just sense, mentioned Thanks. missing at you side? just something Am I a the know basis or points points acquisition, year that look acquisition, and be assets that is I any risk-weighted the trying erring Republic guys MD on would basis your for conservative change suggests these end? been think but to XX the XX quantified books, is And are Republic. points? on of part should And Dominican to And your at in we for your impact XX This your the XX% ratio growth expect? look I it change XX.X. if that to organic then basis you at CETX XX Dominican is, MD also are more

Raj Viswanathan

Hi, take I'll Doug, questions. those it's Raj.

XX As at generation, quarters. strong. capital you're are basis prior It with right. remains consistent It points. far our They internal is organic both

to XX say run acquisitions issuance. to BR the start organic XX risk we'll but the these would forward contributing increasing we'll assets generate points you as acquisition, more our MD capital quarter had, per that some going the far would quarter basis that points to basis Our be points means XX growth of I acquisitions in of some between and which net consistent the risk-weighted market opportunities level, rate XX of see and the we elevated because this basis slightly results was as MD mentioned, As XX

when As the you'll you MD closes, us capital, forma points of next pro basis through we a on as take issuance this XX offset – points can capital have see XX the the to quarter basis. will down quarter see which XX.X which basis

around that end based generation when capital at comes strong the We XX.X% on our will capital QX. internal to expect again between ratio XX.X% be QX, of QX in

Doug Young

And up impact your capital have the generation acquisition, historically. outlook Citibank Chile, doesn't change a that relative you've of what in put the the that Is context fair? material doesn't to BBVA

Raj Viswanathan

term, $XX short BBVA for the adjustment. our quarter example about this contributed non-controlling the to no, earnings after interest In million

As the you impact it Doug. material will indicated we transaction a see on grow, QX, but in BBVA wouldn't

Doug Young

you. Thank great. Okay,

Phil Smith

can we next Operator, have the question please.

Operator

from from Financial. Our National Dechaine next question comes Bank Gabriel

Gabriel Dechaine

on Chile acquisitions. and one Quick BBVA morning. one Good the on

closed Are and got a of $XX.X when level as we over announced added it the to expecting the time did billion you the same the deal more book when than guess to you so I about You still billion, deal. deal? the erosion loan you $X

Daniel Moore

natural. Actually expected. attrition is are less we a that much seeing This we

attrition for computed of we models, been Although We closed in acquisition the some very QX. in good. our has pace the

X% banks. grow We quarter. entity got expect attrition a are combined in loan And both book our already around merger We next to we the year. operating approval for this including

Chile so of grow is is add, attrition recently acquisitions we have very on Chile. of there economy also for the so I seeing, expected at for X.X%, and than would year, economic expected to views growing Chile. meeting the less environment our was X% are next I timely And The say, leaders. economy should I very BBVA positive

as the very acquiring talent good combined team. are We

and very strong are We competitor.

Gabriel Dechaine

invested digit out I'm say. XXXX, then double to And from at picture call all see look for the about for guidance in is $X.XX, this the progressing. is a or acquisitions. to capital. Brian. just work curious see what bigger If that it is meant XX% I That's medium Okay. to you I return the accretion Thanks. they see I longer these and on banks digits when to acquisitions, outcome? for mid-single Attrition dissimilar make term not achievable it a ROIC Is what it much where other or term I

Brian Porter

the are when wealth like we acquisitions and get in BBVA driver obviously big strategically acquisitions accretion is the look to double Chile, the acquisitions number Well, potential but at model we digit ROIC. management the important, obviously these

Chile. BBVA three, double-digit a year So year ROIC on you're around going to four see

Gabriel Dechaine

the term wealth would deals much suspect? be that then than And longer I

Brian Porter

and longer. a the Gabriel. Not too years half to from and what that's with insane MD acquisition, four around expect but be much you'd – wealth five would

Gabriel Dechaine

Thank Got you. I that's you. Brian, right. have. All all

Phil Smith

Operator, we Okay. question the please. Thank you. have can next

Operator

from from Capital next comes question BMO Movahedi Our Markets. Sohrab

Sohrab Movahedi

stay I Thanks. kind think of level here. higher with also just wanted bit Brian, to a you,

you've Over guess, worth. deemphasize, the I purposed few last years wealth institutional going some net into capital high retail

that comment acquisition you, and what's probably over that on the it, I anticipated Chile risk it in to biggest probably you you're you've better execution Is achieve being question the so, layers is here? talked the guess right to about savings that now bit could quickly integration we The risk and real the a of management you pace a deliveries. had has single something even credit the been of the but expense the grow what taking right realignment the not now over bit? acquisition only reinvested here. have out execution and after in of experience know what done some able I maybe all the to Anyway bank. looks like little You've this is

Brian Porter

Sure.

with what very These define done skewed very We divested trophy-like high ourselves at highlight the would was higher a obviously of quality. business them as and [Indiscernible]. price bit we're ourselves on We to wealth felt are We HollisWealth. Just the we're to business. acquire. we've We towards proud management assets levels. And FCI pleased at those. divested

social in And countries. go ROIC number it's your it's through got acquisition we terms or on with and just acquisitions, and of skilled these accretion In at integrations very ground is, on look an teams we've the from the benefit. not wealth be difficult kind thing. transactions what an much integration will back net are business? office, integration getting are people what The How office simpler in perspective, of issues, we the the type

said very necessarily not financial on comment Chile I numbers of the name model, is, approval in I James fast three, but We've years, four we you Jarislowsky time for an brand, we're two, will those on these and these have been been longer. we're MD the acquisitions, if we a a type BBVA said working regulatory had As integration got expedited works plan. not of touching don't on part as the iconic, keeping things. But in the is moment. the business reason Fraser on

the know Chile and So doing teams what relationships we we to and what matter, do XX. on going day on day XXX. day patience what know they're they're to XX, BBVA on matters know going We

highly a we're plan. got out very integration we've thought So And very all our thorough targets. well we'll meet confident that

And a the to on MD. and have forward comment so our rewarding will again, we we're experience James proud to the acquire these look key customer businesses. shareholders. enhancing And

James O'Sullivan

Yes.

client want the cleared has business I like much team. Sohrab, business. as this the add what is country love going, wealth as something I management really here. with needs the would admire admire value. way say MD fee-based, client clearly, That’s aligned. be us needs This The I we not like management. This another complex that that at are on the well is to a complexity business [ph] outset, like and a model what like Just base financial We holistic do business is we and We like. there think allows Its we management think that operational risk. model. on in the and I of team really MD, to we discretionary, puck the We very base. should the is financial the client advisors built low team. management solutions We the we a the business wealth

wealth with fact taking say, Scotia In consistent we've where I'd business, management. been build the they very

a we've agreement with a and clarify, we its model million agreement. agreement the business the position manner into profession CMA's healthy In entered consistent the exclusively will a of in which the as vision, We'll just CMA the on know we under is works. financial So And return Scotiabank that invested CMA, and invest population. with know Affinity to that provider preferred vibrant XX-year $XXX product. be the to going a

Sohrab Movahedi

you. Thank Okay.

James O'Sullivan

Thank you.

Phil Smith

have Operator, we can question the next please.

Operator

from from Mendonca Securities. comes TD question next Mario Our

Mario Mendonca

this not QX, Why QX, spill into it James, there could morning. just address XXXX? XXXX? reason you MD. may why deal in close might any Is on Good

James O'Sullivan

we that aware Mario, I'm of, No, not expect it September. to close late

Mario Mendonca

Okay.

retail again, part operating And and branch of wealth slightly then, domestic to consecutive timing was relates to sense this going negative business. I'm excluding this quarter. James, to sales. is that and my those The quarter second the Just of leverage

forward? where to that speak you mean at in to you're the branch what could operating might sales So leverage going and

James O'Sullivan

bit Thanks disclose each good program impact which fact happy. of to I we in And of that fact for to QX lumpy as end. shareholder it has think Well, the come the Sure, a day fair value, it would end. past you one Mario. comes I branch know, and unlocked sales, seven an an think recognizing this in in of would quarters be

So expect that. you when might we're banking assessing internally adjust Canadian the do we performance on based ex-wealth sales of branch for as

on so to And year-to-date, positive growth we've points basis on operating had XX and same year contributed to-date. basis XX% of basis leverage earnings of that that the

does the there's in So, we and improve. the look operating room quarter and drive growth think I control second this I growth number revenue of leverage lot a elevated expenses reflect as would say expense to for

And so just expense you let for – growth will address moment. if me a

it was much That's banking pretty in as we indicated year-over-year. would expense So P&C X.X% growth be.

and continue. quarter I showed professional I will project in good terminations, think hiring, discipline you want this know fees spend. that we've discipline in

consistent So Investor or start about we expenses growth our X% medium improvements earnings our think Day ratio. commitments, in and of term with better when we productivity

out You'll deliver ratio. recall those productivity for lead specific going we targets to on We're targets. Mario,

give by outlook be so, quarter. be positive next clear asking X% To we'll update on commitment an operating primarily the going this progress the our or I'm So quarter looking for on on XXXX. number I'm that We'll forward, team next demonstrated the to have I'll though, to build more guided plan and to for you leverage. strong to say quarter.

Mario Mendonca

to revenue would XXXX sales fair QX dissipates -- and say sales to be should look branch that XXXX or the to saying the Is should half elevated to a way I'm at in be of branch And you is what So leverage? it XXXX all the because just clear in I'm by see late second operating if start in of this that source that diminished we it? of good late that assuming. level start to certainly XXXX

Daniel Moore

the branch Mario, sales looking forward. that have have math business, at ex in don't front at sales. branch going operating leverage looking positive the because quarters me being ex pretty I P&C of for now strong we're core consistently the I But

Mario Mendonca

Thanks. Okay.

Phil Smith

Operator, can please. next have we question the

Operator

next Eight comes from Capital. Steve Our question from Theriault

Steve Theriault

XXX there from context going you And way. million things far? to touch think the of million being in working about follow-up, Question XXX their terms actually How for just long we'll the can hearing [Indiscernible] its ahead so just of until first the plan. of start on I Chile in me, of if timing a talk and you synergies better about

Daniel Moore

Sure.

the first from way the be we to end allow of pace months years that up million $XX million So acquisition. these we and the execute now. us on of to expect to in synergies expect next and the executing will be XX higher see today two $XX plan $XXX and to integration to range pick $XXX the million between on year we of between the These million

Steve Theriault

investment you should could the here that there terms volatility just for some to unlucky there that structural probably rate? securities year, would versus we turning And Raj, they that. run for Anything Thanks of reduction be it think Okay. great? is course. Or with of run its will us gains, year low in last been quite all help any downside is

Raj Viswanathan

I elevated think million. has slightly million, year. of the to $XX up It's investment QX Steve, in about this security gain, has been XX

of do This the Based we what is which down million. many investment normalized changed more purpose lot with for securities quarter to and IFRS it's you can we positions of on $XX the think on. so hold what levels gains. liquidity obviously of X about

probably rate a $XX $XX the to I So million is is million quarterly forward. more what run would look as we reasonable suggest

Steve Theriault

helpful. That's Thank you. Okay.

Phil Smith

we can please. question Operator, next the have

Operator

Our next Scott Canaccord. comes question from Chan from

Scott Chan

than it impact do declining looking does And think margin Thank the seems How forward? you. international Chile BBVA like the again, Maybe at for the is trend how stable. that? going side more Raj the that just we on of

Daniel Moore

the past around been volatility at even as growth of because if year-over-year in lot we Well, stable variations our especially to points in a personal case look growth a many mentioned see more In deposits quarters wholesales the but commercial business relative there's than XX see will countries I due so you platform we in retail quarters, the it three the our basis past from be have NIM to NIM, and mostly quite previous pace you stability of mix. if of is XXX of calls faster deposits. in it some loans has this

So other than that stable. we margin our see

funds because the mention the Raj of to is be Colombia there some reduction normalized a reduced. cap to As that rate, margins compression also of gradually but was that in due going

very So can is and us overall Chile XX% on our that at growth has for growing lower BBVA overall its our We we X% assets see to loan IV margins stability can Pacific update the for countries. margin, Alliance [ph] strengthen have update offline solid the margins allowing that of BBVA with Chile revenues an you combined in lower about and impact acquisition, $XX on estimation. billion NIM and that has will we

Scott Chan

to XXX for Raj. estimate XXXX. The XXXX Okay. integration Great. more or And Is front quick is just question straight modeling it maybe that and a more ended? XXX is cost for line

Raj Viswanathan

after will of next share. incurred impact and It that this that’s years. number cost forward. so about over we non-controlling a think net per as that the is number look our straight earnings line the in two XXXX, clear, We be will million is $XXX more about be say taxes And a interest, XX% to got so let’s will after be

Scott Chan

Okay. much. very you Thank

Operator

Markets. from next Mihelic question comes from Darko Capital RBC Our

Darko Mihelic

liability morning. just question there good the Hi, actually My the is of What in has other that the caused else the a the happening it acquisitions was of and other occurred segment? do securities, in that ALM. was occurred, it with just asset that the and quarter bigger because elevated to loss at in management something sale or this segment is there coming quarter beyond perhaps

Raj Viswanathan

because and the asset notes. course margin of this we asset depend other securities what mentioned call The lower segment has activities on management I activities a indicated my primarily higher of before The gains management liability like in overall had loss I liability compression. quarter that

ratios those purposes for for we LCR assets [ph] hold have corporate know So that in a the liquidity what purposes. segment of and we you lot

and our relating So down interest on quarter slightly continuously as We as elevated level interest this our prior assets. reposition rates those sales quarters. changed, to margin we could it have of in had outlook know to compression compared you tax, or up move rates margin book

Darko Mihelic

the then gain of it the the lower is is way should bulk it that. mean So

Brian Porter

Darko, it’s correct. Brian. That’s

read So and lower prices. have had going it’s is gain know assets on X credit rising and function don't out. as But, you we rates as anything which you know rates spreads compression security quality that it a high liquid of some IFRS interest I other rise or into than

Darko Mihelic

just real for a Okay, quick that's helpful. And follow-up James.

you Scotia the talk talk you – have in deposits your and for to growth We if Canada. Can competitive could forward what going for competition there deposit heard of some environment? the growth in maybe out conflicting to and how stories deposit are expectations

James O'Sullivan

Darko. to happy Okay

P&C business; with start we We had let’s of Banking of in our had again deposit how we growth So X%. did. quarter this kind

is this. the we’ve we X% Personal up you placed were reflecting think evidence focus just of result the on solid X%. non-personal up X%, I focus deposits And know were a that exceeded by asset it growth – and asset exceeded growth growth spot billion. have it, believe this on progress spot making deposit we’re know you I spot sorry quarter of with $X.X as the

our from improved. So very our is this perspective, very on focus much,

us, business, for X% our book are there impacting It’s the As quarter, also that continue somebody decline. about results year-over-year. deposits we decline. are And we’ve deposit seen of some perhaps, then last discussed to -- wealth items down broader some does the broker

that that on runoff. HollisWealth You of have Well lots know deposits side see with both when here there on personal were the and we we the extent certain to a opportunities business non-personal side. sold associated

deposit on the particular I’d in be very the first on very competitive. gathering focused commercial has business very that small to performing side, non-personal We’re for well. the very acknowledge been But environment is

some so able so personal number the growth growing we’ll that deposits range balance overall think commercial a at have it between and we delta we’ve gap environment, there This asset growing and as focus banking, a retail so sitting now. one know, will You to to sheet I about manage will X, narrow But to long don't that work is were be at were is and after we than X% I were in grow we current say deposit deposits right that’s ago growth assets. overtime. gap wasn't our that that got banking a in sensibly.

Darko Mihelic

much very for the Thanks color, James.

Raj Viswanathan

we call day. Thanks everyone you for participating today, in forward in our speaking November. great to again a look and Have with

The Bank of Nova Scotia (BNS) 28 Aug 182018 Q3 Earnings call transcript