Good afternoon, ladies and gentlemen. Welcome to the TD Bank Group Q3 2016 Investor Presentation. Please be advised that this call is being recorded. I would now like to turn the meeting over to Ms. Gillian Manning, Head of Investor Relations. Please go ahead.

Thank you. Good afternoon and welcome to TD Bank Group's third quarter 2016 investor presentation. My name is Gillian Manning, and I'm the Head of Investor Relations at the bank. We'll begin today's presentation with remarks from Bharat Masrani, the bank's CEO; after which, Riaz Ahmed, the bank's CFO, will present our third quarter operating results; Mark Chauvin, Chief Risk Officer, will then offer comments on credit quality; after which we will invite questions from prequalified analysts and investors on the phone. Also present today to answer your questions are Teri Currie, Group Head, Canadian Personal Banking; Mike Pedersen, Group Head, U.S. Banking; and Bob Dorrance, Group Head, Wholesale Banking. At this time, I would like to caution our listeners that this presentation contains forward-looking statements. That there are risks that actual results could differ materially from what is discussed. And that certain material factors or assumptions were applied in making these forward-looking statements. Any forward-looking statements contained in this presentation represent the views of management and are presented for the purpose of assisting the bank's shareholders and analysts in understanding the bank's financial position, objectives and priorities, and anticipated financial performance. Forward-looking statements may not be appropriate for other purposes. I would also like to remind listeners that the bank uses non-GAAP financial measures to arrive at adjusted results to assess each of its businesses and to measure overall bank performance. The bank believes that adjusted results provide reader with a better understanding of how management views the bank's performance. Bharat will be referring to adjusted results in his remarks. Additional information on items of note, the bank's reported results and factors and assumptions related to forward-looking information are all available in our Q3 2016 report to shareholders. With that, let me turn the presentation over to Bharat.

Thank you, Gillian, and thank you everyone for joining us today. Q3 was a good quarter for TD. Earnings were C$2.4 billion, an increase of 6% from a year ago, and earnings per share were C$1.27, also up 6%. In our Canadian Retail segment, strong fundamentals in our personal and commercial banking and wealth businesses were offset by the impact of the Fort McMurray wildfires and a higher tax rate. Our U.S. Retail segment delivered impressive results across the board, with revenue expense and credit metrics all performing well. And our Wholesale Banking had a very strong quarter with higher lending and origination activity. We also delivered good results on the capital and liquidity front. Our CET1 ratio rose to 10.4%, up 30 basis points from the prior quarter. Our leverage and liquidity coverage ratios remain above target. And we passed a major milestone, successfully completing our first CCAR submission in the U.S. Turning to our businesses. Canadian Retail earnings were C$1.5 billion in the third quarter, down 3% from a year ago. Personal and commercial banking earnings rose 1%. Volume growth, higher fee income, and disciplined expense management helped offset higher credit provisions and lower margins. These continue to affect the year-over-year comparison but both improved sequentially. Our wealth business had a very strong quarter, with double-digit earnings growth and another quarter of C$10 billion in net asset growth. The insurance business saw earnings decline as a further improvement in prior year's claims development was offset by higher claims cost this quarter, largely relating to Fort McMurray. I'm pleased to report that we reopened our Fort McMurray branches in June, and we continue to assist our banking and insurance customers as they return to their homes and community. We were proud to be the lead sponsor of last month's…

Thank you, Bharat, and good afternoon, everyone. Please turn to Slide 5. This quarter the bank reported earnings of C$2.4 billion and EPS of C$1.24. Adjusted earnings were C$2.4 billion and adjusted EPS was C$1.27, both up 6% year-over-year. Revenue increased 9% year-over-year, or 5% excluding FX and acquisitions, led by loan, deposit, and wealth asset growth. Adjusted expenses increased 7% year-over-year, or 2% excluding FX and acquisitions. PCL increased year-over-year but declined 5% quarter-over-quarter. Segment reported earnings were C$1.5 billion for Canadian Retail, just under C$800 million for U.S. Retail and C$302 million for Wholesale, and the Corporate segment reported a loss of C$241 million, or C$183 million on an adjusted basis. Please turn to Slide 6. The Canadian Retail segment earned net income of C$1.5 billion, down 3% year-over-year. Revenue growth of 3% was more than offset by higher insurance claims and a higher effective tax rate in the quarter. Total loan growth was 5% year-over-year, with personal lending volumes up 4% and business lending volumes up 10%. Deposits increased by 8%, reflecting growth in core checking and savings accounts, which were up 10%. Business deposits grew 8% and wealth assets grew 7%. Insurance claims increased 15% year-over-year, primarily due to the net impact of the Fort McMurray wildfire as well as other weather-related claims, partially offset by more favorable prior year’s claims development. Margin increased 2 basis points quarter-over-quarter, primarily reflecting higher seasonal revenue, partially offset by lower lending margins. PCLs decreased 2% quarter-over-quarter, primarily reflecting lower delinquencies in personal banking. Expenses increased 1% year-over-year, and on a year-to-date basis, expenses are up 1%. Please turn to Slide 7. Aggregate adjusted U.S. Retail earnings were up 16% year-over-year in U.S. dollars and 21% in Canadian dollars. The U.S. Retail bank posted earnings of US$512 million, up 14%…

Thank you, Riaz, and good afternoon, everyone. Please turn to Slide 11. Credit quality remained strong for the quarter as evidenced by reductions in the bank's overall level of gross impaired loan formations, gross impaired loans, and credit losses. Gross impaired loan formations are down C$229 million, or 4 basis points for the quarter, to C$1.2 billion. U.S. Retail accounted for the majority of the decrease with formations down C$122 million, driven by legacy interest-only HELOC and U.S. commercial loans. Formations in Wholesale decreased C$94 million due to lower formations in the oil and gas sector. Please turn to Slide 12. Gross impaired loans are down C$99 million, or 4 basis points for the quarter, to 59 basis points. The Canadian Retail gross impaired loan rate at 27 basis points for the quarter remains at cyclically low levels. U.S. Retail was the main contributor to the decrease, with an improving trend in formations and resolutions within the legacy interest-only HELOC portfolio, along with good performance in the U.S. commercial portfolio, partially being offset by the negative impact of foreign exchange. Wholesale gross impaired loans increased C$33 million due to two new formations in the oil and gas sector. Moving to Slide 13. As indicated in previous quarters, U.S. strategic card PCLs are reported on a net basis for segment reporting, only including the bank's contractual portion of credit losses. For the purpose of the credit slides, we continue to report gross losses to better reflect portfolio credit quality. Provisions for credit losses were C$563 million, down C$29 million, or 3 basis points quarter-over-quarter, to 39 basis points. The primary factors impacting PCL in the quarter were: first, a C$39 million decrease in provisions for the Wholesale portfolio; second, a slower rate of reserve build for incurred but not identified losses recorded in the Corporate segment; and lastly, a C$34 million increase in U.S. Retail driven by volume growth. Year-over-year, the bank's provisions for credit losses increased 6 basis points due to a higher rate of reserve build and an acquisition in the U.S. strategic cards portfolio. Please turn to Slide 14. The pace of new impaired formations and losses in the non-retail oil and gas producer and servicers segments slowed during the quarter as the price of oil stabilized in the C$40 to C$50 range and gas prices strengthened. Consumer losses in oil-impacted regions moderated and continue to be offset by favorable performance in the rest of Canada. Assuming oil and gas prices continue at current levels, I remain comfortable with my prior guidance for possible losses due to low oil and gas prices. To conclude, the key takeaways this quarter are: credit quality remained strong and the credit impact associated with low oil and gas prices stabilized during the quarter. With that, operator, we are ready to begin the question-and-answer session.

Thank you. [Operator Instructions] And we'll now take the first question from the line of Meny Grauman with Cormark Securities. Please go ahead.

Hi, good afternoon. Revenue growth in the Canadian P&C business is a little bit under 2% year-over-year, below average. And I'm wondering how you view that. How much of that is a frustration? How much of that is just a reflection of your concern about the market specifically? There's been a lot of talk obviously about the housing market and some problem areas there.

So maybe I'll break that into two pieces. Just in terms of revenue growth and sort of outlook, we’re committed to the growth opportunities that we talked about in the fall in the Investor Day. We expect good volume growth across our businesses, good claims management, good wealth client acquisition. We're continuing to see record primary checking customer acquisition, which continues to give us great opportunity to continue to deepen relationships with those customers like we talked about in the fall Investor Day. We have opportunities where we're under sharing unsecured lending business, credit card, mutual funds and we're continuing to make good progress in all of those. In our unsecured line of credit business, we had record acquisition in Q3. In our private investment and advice business, we had record growth in Q3. And when we look at external market share across a number of categories, mortgage unsecured lending, auto finance business, loans, personal long-term deposits and mutual funds, we're continuing to gain share. So I’d say we have a good outlook on growth going forward. In terms of the comments around the housing market, again, we continue to, I think, apply the same good standards we have over the past period of time across Canada, doing good business with customers across Canada. Market share, as I said, in mortgages is increasing. It's going up. We continue to feel good about the quality of our portfolio, about our standards, about the quality of our originations, and I would say, across markets, continue to generate good business. I would say that in the B.C. market, if we look at externally available data, our net portfolio growth and our market share would be slightly below the average.

Thanks for that. If I could just ask a question on the restructuring as it’s flowing into run rate savings. You talked about C$600 million by 2017. How much of that is in the numbers right now?

Meny, it's Riaz, I think we're entirely on track with the guidance that we had given at the time that we took the restructuring charges.

Okay. And then I just noticed, related to that, the occupancy and equipment categories in the expense side had noticeable declines quarter-over-quarter. And I just wanted to know, how much of that was just maybe seasonal noise or how much of that was a product of the restructuring efforts?

I think you'd probably have a combination of both in there, Meny, and I think with the way the quarter-over-quarter numbers work out, I'm not so sure that I could give you more specific than that.

Okay. Thank you.

We'll now take our next question from the line of Ebrahim Poonawala with Bank of America Merrill Lynch. Please go ahead.

Good afternoon, guys. Just in terms of, if you can, Riaz, talk a little bit about the capital build. It was pretty strong this quarter. As you look out over the next six, 12 months, if you can remind us what sort of the capital deployment priorities are? And also if you can tell us what the outlook is in terms of acquisition opportunities in the U.S., if there's a geography we're focused on or particular assets that you would prefer to buy?

Ebrahim, this is Bharat Masrani. On capital, as I've said previously, we look at our capital deployment strategies on a regular basis with various items coming into consideration. We start with how much are we going to need to support our core businesses with respect to growth. We also look at are there any particular gaps within our franchise that we need to either acquire or build that is going to require capital to be used. And we have done that consistently over the past little while. We also look at how the regulatory regime might be emerging or what expectations might be out there. So that is as well looked at. And then, as you pointed out, we also look at potential M&A activity in our markets. And for us, we have a stated strategy of looking at acquisitions in the U.S. I previously said that we would certainly look at any asset plays. You've seen us play an active role in the card space. Those are transactions and deals that we are very happy with and would love to have more. With respect to big acquisitions, we've said in the Southeast of the U.S., if there are tuck-ins available, we would certainly be interested and look at them seriously. So there is a whole framework we use from a capital deployment perspective. And that's how we assess the level of capital we may need or what else we should be doing.

That’s helpful. Thank you.

Thank you.

We'll now take our next question from the line of Gabriel Dechaine from Canaccord Genuity. Please go ahead.

Good afternoon. Can you hear me?

Yes.

So I just want to ask about that collective. It’s the fifth quarter in a row I believe you're boosting the collective? I get that there's portfolio growth driving that. But is it really a regular item that we should expect to record? It has been five in a row. And it seems to me like it might be also putting you in a better position ahead of the IFRS 9 transition, which is in the first quarter 2018, I believe. Is that one way of thinking about it?

It's Mark, Gabriel. I don't believe we did it last year, so it will be four quarters in a row that you'll be correct on that. And I would say that if you look at this quarter's increase, the C$40 million that was driven in the Canadian business, which includes wholesale, was really primarily due to negative migration in the oil and gas sector specifically. And we incurred that in the early part of the quarter, but we’ve really seen it taper off since then. So I'm not looking for that to continue. The balance of the increase was really in the U.S. And I'd say it's split two ways: half pretty much goes to volume and you would expect the provisions to increase with volume; and the other half would be for foreign exchange. It's not linked to forthcoming IFRS 9.

Do you have any indications on IFRS 9 yet or do you know when you'll do it to give us a sense?

No, we're working through it. But, at this point, and looking at the methodology and how it's implemented, I'd say we're couple quarters away from having clarity on what the impact would be.

Are you still thinking about it as a capital issue primarily as opposed to an earnings issue like on the transition? Because I know some estimates out there are for a pretty big increase in the collective provision for banks, not necessarily Canadian banks, but it would affect you.

I think, Gabriel, whatever catch-up adjustment there is to the allowance would certainly affect capital and we'll await guidance from regulators in how to deal with that. But I don't think we view it as a capital item. It is an accounting as to how you provision against future credit losses and that's how we're looking at it.

All right, okay. Then just a follow-up on Meny's question. Teri, I appreciate the response you gave on all the things you’re encouraged by and some of the growth that you're seeing in your business. I was just wondering, do you view this as a disappointing quarter for the last few quarters? The growth has been on the soft side. Or do you think this is more of a transition period and we'll have better results out of the Canadian Retail business in the next year or so? And then I'll slip in this one for Mike. Margins were up in the U.S. Is that something we should expect more of? Or do you expect it to stay flat from here on out? Because the Fed rate hike outlook doesn't look so rosy right now.

Teri here. For the first part, I'd say our results were as advertised this quarter and I think that as I said before and as we talked about in the fall, we've got some really strong levers of growth in terms of deepening relationships with our existing customers that I do believe will pay off as we move forward. And we continue to remain committed to the medium-term objectives that we talked about.

That was like 5% to 10% growth? Or 7% I think? Or...

7% at the Canadian Retail level.

Yeah, okay.

And it's Mike. On the other part of your question. Yes, we had 3 basis point increase this quarter. It was really up for two reasons. One was some positive accounting benefit related to our balance sheet management. This is revenue neutral but resulted in higher net interest income and lower other income. And then the other reason was slightly better deposit margins because LIBOR was a bit higher and that benefits our rate-sensitive deposits. In terms of outlook, we'd still say that we expect relatively stable margins and NIM for the near term. And frankly, both on deposits and loans.

Thank you.

Your next question will come from the line of Robert Sedran with CIBC. Please go ahead.

Hi, good afternoon. Actually, just a quick follow up on that question from Gabriel on the collectives. Just to be clear, in terms of the part that was related to migration, to the extent the losses do present themselves under identifiable, will they require a fresh specific or are you going to be able to dig into the collective to cover them?

The way it would work is collective allowances for the performing book, so you have a certain amount that’s set aside based upon the risk rating. When it becomes impaired, it comes out of the collective, so whatever was there is gone or is reversed. And you, based upon the specifics of the loans, set up a specific provision. So the answer is that, yes, the specific is covered partially by what was in the collective. It depends upon the size of the specific.

Okay. Because otherwise it sounds like you’d have to reserve for the same loan twice. But it sounds like you're...

No, there are no collectives against impaired loans. Always specific.

Understood. Okay, thank you.

We'll now take our next question from the line of Sohrab Movahedi with BMO Capital Markets. Please go ahead.

Thank you. Mike, the U.S., maybe can you talk a little bit about the – I know Bharat talked about the vibrant economy over there and the expectations and the outlook over there. If you can speak a little bit to your business and the types of volume growth and operating leverage that you were able to deliver this quarter and how you feel about that as far as the next, call it, four to six quarters are concerned.

Yes, so I'll just start by saying that given our size in the U.S., there is a limit to how much our performance correlates with the overall economies. It’s obviously better if it’s strong. Our view is that our outlook is fairly good just based on the opportunities we have in the business and the competitive advantages we enjoy. In terms of the economy, the consumer is certainly strong and we're seeing that in our business. We're seeing strong business lending growth as well. There is a bit of a paradox there, in the sense that we've seen some weaker investment numbers in the U.S. economy recently. But I think it helps us that we are underweight in some of our U.S. lending businesses and have built strong capability and teams and our brand resonates well with the corporates and commercial customers. So we're finding that we're being very successful in growing that business. The operating leverage was particularly strong this quarter. We're enjoying good revenue growth right now as volumes are good and our margin is stable. And my sense is that volumes will continue to be strong. It's possible that in some categories it will moderate a bit. Those might be commercial and auto, although I'm not seeing that yet. But as was the case with Teri's comments, we are very disciplined about our credit and we'll continue to do what's right for our franchise. And for the foreseeable future, I see our growth being good in the U.S. And in terms of expenses, I think hopefully, we'll be able to sustain the kinds of expense growth that roughly or broadly you are seeing right now, and therefore, we should be able to continue to deliver a positive operating leverage.

Okay. And just to go back to the collectives and business volume growth. You're not reaching I'll call it as far as credit quality or your risk appetite to generate the volume growth here, are you?

No. To be clear, the business that we're putting on is very high quality. In fact, as we put on new business, whether it is in commercial or other areas, it's improving our portfolio. Whether you're looking at lagging indicators or leading indicators, we're not seeing any evidence of deterioration in the credit portfolio. I'll invite Mark to comment because he might be more objective.

No. I think it's safe to say with the exception of the oil and gas sector, which we now see as kind of stabilized, portfolio quality throughout all of our other portfolios is really at very strong levels. That's certainly true of the U.S. And the reality is that volume growth will bring with it an increase in the collective. I mean that's just the way it works. If you're putting on incremental loans, everything else being equal, you're going to have an increase in your collective allowance.

So, Mark, you're saying nothing to really read into a bank who's CEO is a former Chief Risk Officer that it’s adding to the collectives? This is just – we shouldn't read too much into this?

Well, no, I'd say we do an analysis of our change in collectives because it tells us a lot about our portfolio. And you look at it for increases that are driven by volume, or they can be driven by risk, which is a migration, which was in the oil and gas sector, but not in the other parts of the portfolio or methodology change. And really what we saw this quarter was other than the oil and gas sector, it was volume and the quality in the U.S. kind of offset some of the increase. It was improvement in the collective.

Sohrab, I would just add that regardless of who the Chief Risk Officer of the bank might need, TD has always had a tradition of solid risk management and I'm glad to report that that continues.

Glad to see it's continuing. Thank you.

We'll now take our next question from the line of Sumit Malhotra with Scotia Capital. Please go ahead.

Thanks. Good afternoon. My questions will be for Teri on Canadian P&C. I was interested that you stated that you feel you're still taking market share in residential mortgages. Because when I look at the last page of your supplement, it looks like for the past six months, the resi mortgage balances in Canada have actually been pretty flat, and I think we can agree that this quarter, in particular, is usually one that we have seasonal strength. Before you answer that, I just want to say I don't necessarily think that slowing the pace of growth in this business is a bad thing, given where we may be in the cycle of the housing market. But just wanted to come back to you and maybe Mark, it's tough to see from these numbers how you're taking share. And secondly, has there been any deliberate change on your part in terms of origination standards that has resulted in this slower pace of growth?

So on the share, obviously, those are lagged numbers that we get externally. So I would say those numbers are the most recent that we have to measure how we're doing. In terms of this quarter, we had record mobile mortgage sales force originations and record branch originations. So we've had strong growth in the portfolio. I would say, we've done that by maintaining the same disciplines that we've had in the past. So I'm not concerned about the quality of the portfolio or of those originations. We'll have to wait and see through external reporting because obviously it is lagged, whether that does play out in increased share. But for what we know today, we're continuing to grow solidly.

It's Mark. And from my perspective on the risk of new originations, which is really what you’re getting at, I think the key part is to have a consistent underwriting strategy or underwriting guidelines that are the same throughout the cycle, and so they don't get weaker in exuberant times. And we're very strong in trying to do that. But, of course, over the last three or four or five years with increasing home prices, you do look at them and you say, I want to make sure that I'm comfortable with these underwriting standards and that they're good for our customers and that they will pass that test. So there have been some changes clearly. We put a lot more focus on income confirmation to ensure that the mortgages that we do provide to the individuals that they can service them certainly at the time that we provided it. When we make exceptions, we put a structure in place to say that let's elevate the thought process of the decision-making, so when you're making exception that's out of the underwriting standard, it's not a bad thing as long as there's a compensating factor just to make sure there's a compensating factor. And the other is, we've put more focus over appraisals just to make sure that there's second pair of eyes on them and that we’re comfortable with them. So these are things that naturally occurred over the last three or four years, and clearly, they’re going to have an impact on areas that grow really quickly, because our policy is not to deviate from them regardless of how the market is going.

No, that's some really good color and I want to reiterate this point again. We might be sitting here a year from now and saying, hey, you guys were right to perhaps have a slower pace here. And for Teri, I mean, you've got some external data. Our data is the stuff that the banks tell us. And on that basis, we can see here that the mortgage growth has been slower. And again, I appreciate that color from Mark, because I think it makes sense given where we are in the cycle to perhaps put some changes in place. Let me wrap up. The other question I had for this segment was on expenses. And we know you announced a couple of restructuring charges last year. And on the back of that, we're seeing, if I round the last four quarters on a year-over-year basis, the expense growth basically comes to zero. And Teri, as we look to 2017, I'm sure some of the benefits, if I can call it that, from the restructuring, will still be in place. But when we look at this lack of growth in expenses and compare that to some of the investments you're making in the business, what is a more reasonable level of expense growth that we should expect for Canadian P&C in 2017? I'd be surprised if it's zero again, but I'll hear that from you.

So I wouldn't expect zero as we move forward. Obviously, we're continuing to pay attention to delivering over the course of the year a positive operating leverage. So that will be something, in that as we think about our plans for 2017 that we manage ourselves to over the course of the year, there may be some quarter-over-quarter differences and we will continue to make the investments we need to make. I wouldn't expect us to return to prior levels of expense growth.

Thanks for your time.

We'll now take our next question from the line of Doug Young with Desjardins Capital Markets. Please go ahead.

Hi, good afternoon. I guess my first question is for Riaz. The model refinements on the CET1 ratio, by my math, added about I think it was around 31 basis points to the CET1 ratio. And I apologize, I think you mentioned there was an offset in your prepared remarks, and I'm just wondering what that offset was and if you can give a little more detail. And then just around the movement of the U.S. Retail portfolio to the AIRB methodology, is that mostly done now for the U.S. or is there more portfolios that could move over? And if so, can you quantify what the potential impact would be?

Yes, I think on the CET1 impact, Doug, you have to look at, we transitioned U.S. Retail portfolios and we also went to the advanced measurement approaches for operational risks. So that is one offset that you would see. So in your flow of risk weights, you'll see that offset. The other thing you have to just be mindful of is when from a bank is reporting both on standardized and AIRB basis, the Basel calculation around expected credit losses are compared to your general allowances and adjustments are made to your capital that you'll see in our capital calculations in the supp pack. So the net will follow that – well, it turned out to be about neutral. The additional portfolio that remain to be transitioned is the U.S. non-retail portfolio, and that is still a work in progress.

Any timing of when would that be? Fiscal 2016, or is that most likely a fiscal 2017 event?

I think it's hard to call. As you know, there's a lot of modeling and work and data involved and then there's a regulatory approval process. So I think it's difficult to call what the timing on that would be.

And then just two maybe follow-up questions for Canadian Banking for Teri, I guess. I think just looking for a little more color on your NIM outlook, because it looked like NIMs were a little bit better than what we expected this quarter. And then also on the credit side, it looked like there may have been a bump in auto lending. Just wondering if you can elaborate on that. Thank you.

So on the NIM, that was a seasonal change, as Riaz mentioned, and so we would stay with our guidance that you've had of modest downward pressure, a combination of low interest rates, product mix, and competitive pricing. On auto lending, are we talking volumes or NIM?

No, more credit.

Yes, so in terms of increased volume?

Is that what drove the higher PCL for auto lending was volume or was there any...

A few factors. One of the main factors would be volumes.

But you’re not noticing any material increase in delinquencies or pressures on the credit side on that book?

It's Mark. I'd say that on the consumer side, in the oil-impacted provinces, that's an area that we have seen. We mentioned that we've seen increases there. I'd say the auto is probably the leading increase in that category. And they are big numbers and they're offset by the rest of Canada, but clearly that's where we're seeing it.

Okay. Great, thank you.

[Operator Instructions] We'll now take our next question from the line of Mario Mendonca with TD Securities. Please go ahead.

Good afternoon. First a question, again back to domestic banking. On page, I believe it’s five of the supplement, we see that risk-weighted assets are down to C$99 billion from C$110 billion last quarter. Maybe there's a simpler explanation for that significant change? But I don't know off the top of my head?

Mario, transition to advanced measurement approaches for operational risk?

That was the C$10 billion, C$11 billion move in the quarter?

Yes.

Okay. By the nature of all the questions that are coming up, Teri, it's clear that the market is collectively scratching – we’re all collectively scratching our heads on why this premium domestic retail bank isn’t keeping up with its peers. So I know the banks do a lot of peer review. Is there anything you can think of from a structural perspective, maybe it's a mix of loans, mix of deposits, or anything that would explain why TD has lagged over the last little while in domestic retail banking? And I'm referring to margins, loan growth, a couple of things. Is there anything that you could point us to?

So on the margin front, the biggest factor has been low interest rates and the cost of funds for residential mortgages in particular.

And do you think that TD is different in some respect from your peers, because the TD's margins have been materially lower or declining more than the peer group.

So we’ve had a pretty good look at that and I think we feel that we’re all in relatively the same place as it relates to NIMs and the outlooks for NIMs going forward.

Year-over-year, TD's NIMs are down about 10 basis points. This is year-over-year in domestic retail. What we’re seeing for the group is about half of that, maybe a little less than half. So there's nothing then, Teri, you can point us to that would explain why TD’s margins are lower or deteriorating faster?

Nothing beyond the lower interest rates, competitive pricing, and the cost of funds for mortgages.

Okay, and then in other income just the fee side, that's another area where it does appear that the bank has lost some momentum relative to the peer group. Is there anything going on on the fee side that you would point us to?

Nothing that I could point to particularly. I think on the fee side the increases have been primarily due to repricing.

Okay. Thank you.

Thank you. And, at this time, I would like to turn the call back to Mr. Bharat Masrani for closing remarks.

Thank you very much, operator. So just to wrap up, another good quarter from TD. And I'd like to take this opportunity to thank our nearly 80,000 TD Bankers around the world for continuing to deliver legendary experiences to our customers as well as continuing to deliver good performance for our shareholders. Thank you for joining us this afternoon and see you at next quarter end.

Ladies and gentlemen, this concludes today's call. Thank you for your participation and you may now disconnect your lines.