Good afternoon, ladies and gentlemen. Welcome to TD Bank Group Q4 2018 Conference Call. 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, operator. Good afternoon and welcome to TD Bank Group's fourth quarter 2018 investor presentation. My name is Gillian Manning, and I am the Head of Investor Relations at the Bank. We will begin today's presentation with remarks from Bharat Masrani, the Bank's CEO; after which Riaz Ahmed, the Bank's CFO, will present our fourth quarter operating results. Ajai Bambawale, 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; Greg Braca, President and CEO, TD Bank, America's Most Convenient Bank; and Bob Dorrance, Group Head, Wholesale Banking. Please turn to Slide 2. 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 it's businesses and to measure overall Bank performance. The Bank believes that adjusted results provide readers 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 2018 MD&A and the fourth quarter 2018 earnings new release. With that, let me turn the presentation over to Bharat.

Thank you, Gillian, and thank you everyone for joining us today. Q4 was a great quarter for TD and it caps off a strong year for the bank. We executed well in all of our businesses guided by our long-term strategy as a purpose-driven organization, operating from a position of strength as we build a better bank for tomorrow. Given our few key measures that underscore the quality of our results in 2018. Earnings surpassed $12 billion on a full year basis, up 15% from last year's $10.6 billion, itself the high watermark, and EPS rose 17% to $6.47. Revenue grew 8% and we achieved 400 basis points of operating leverage. Return-on-equity rose to nearly 17% driven by increases in all of our business segments. Our CET1 ratio increased 130 basis points to 12% including 20 million common shares bought back during the year. We also delivered good value for our shareholders, our dividend paid increased by 11% on a full year basis. We delivered above average total shareholder return this fiscal year, and we led our Canadian peers with DSR over the 3, 5 and 10-year periods. And today we announced our intention to repurchase up to an additional 20 million common shares for cancellation subject to regulatory approval. Let me now highlight some key accomplishments in each of our segments. Canadian retail had a very successful year in 2018 with earnings up 10%, surpassing $7 billion. Our banking, wealth and insurance businesses all performed well as customers entrusted us with more of their business. We strengthened our market leadership position in key product lines maintaining our number one ranking in credit cards, direct investing and direct distribution in affinity insurance; taking share in private banking, and extending our lead in personal non-term deposits, the bedrock of our high…

Thank you, Bharat and good afternoon, everybody, please turn to Slide 5. For 2018, the bank reported earnings of $11.3 billion, and EPS of $6.01, up 8% and 9% respectively. Adjusted earnings were $12.2 billion and adjusted EPS was $6.47, up 15% and 17% for the year respectively. Revenue increased 7% with growth across all our business segments, and expenses increased 4% on a reported and adjusted basis as we continue to invest in people and technology to execute on our strategy. Excluding the impact of FX, adjusted expenses increased 5%. PCL increased 12%, primarily reflecting higher PCL in the U.S. retail and corporate segments, including higher provisions for the U.S. strategic cards portfolio, the partner share of which is held in the corporate segment, and offset in corporate non-interest expenses. Canadian retail and U.S. retail delivered net income of $7.2 billion and $4.2 billion for the year respectively, and wholesale reported over $1 billion in earnings. Please turn to Slide 6. This quarter the bank reported earnings of $3 billion and EPS of $1.58, adjusted EPS of a $1.63, up 20% reflecting strong results in all of our businesses. Revenue increased 9%, provision for credit losses increased 19% quarter-over-quarter, and expenses were up 11%. Please turn to Slide 7. Canadian retail segment net income was $1.7 billion, up 5% year-over-year on good revenue growth, partially offset by higher expenses, insurance claims including CATS [ph] and PCL. Revenue increased 8% year-over-year reflecting higher loan and deposit volumes, margin expansion, higher insurance revenues and wealth trading and asset growth. Loans grew 6% year-over-year with increases in both, personal and business volumes, and deposits increased by 3% reflecting growth in business and personal deposits. Wealth assets grew 1%, margin was 2.94%, up one basis point quarter-over-quarter, primarily due to higher interest rates…

Thank you, Riaz and good afternoon everyone. Please turn to Slide 12. The strong credit quality we saw throughout the year carried into the fourth quarter. Gross impaired loan formations were $1.4 billion or 21 basis points, up 3 basis points quarter-over-quarter, and up 2 basis points year-over-year, reflecting new formations in the Canadian commercial portfolio from which we anticipate immaterial credit losses and seasonal trends in the U.S. credit card and auto portfolios. Consistent with recent quarters there were no new formations in the wholesale segment. Please turn to Slide 13. Gross impaired loans ended the year at $3.15 billion or 47 basis points, up 2 basis points quarter-over-quarter, and down 2 basis points year-over-year. The primary contributors to the quarter-over-quarter increase in gross impaired loans were new formations in the Canadian commercial portfolio, seasonal trends in the U.S. credit card portfolio, and the impact of foreign exchange. The wholesale segment maintained a zero impaired loan balance quarter-over-quarter. Please turn to Slide 14. Recall that our presentation reports PCL ratios, both gross and net of the partner share of the U.S. strategic card credit losses. We remind you that the banks contractual portion of credit losses is reported in the U.S. retail segment whereas the partner share is reported in the corporate segment. The bank's PCLs in the quarter was $675 million or 41 basis points, up 6 basis points quarter-over-quarter, and up 2 basis points year-over-year. The primary factors contributing to the quarter-over-quarter PCL increase were an increase in the wholesale portfolio largely due to a prior period benefit, a one-time impact related to methodology enhancements in the Canadian result portfolio, and seasonal trends in the U.S. credit card and auto portfolios. As experienced in previous years, PCLs typically rise in the fourth and first quarters in the…

[Operator Instructions] We'll take our first question from Gabriel Dechaine.

First question is on the commercial real estate portfolio in Canada. And a couple of observations; one, you have been generating much lower growth than your peers, half in that category. And then I do see some divergence though between what you call resi and non-resi whereby resi is growing fast and non-resi is actually going down. Just wondering; A) are you deliberately holding back growth in this category? And B) what's in the resi -- in the subcategories that might be causing that divergence?

On the sort of overall portfolio of commercial real estate, you're right, the growth has been more muted versus the other areas of the commercial lending growth. I would say, if you look at our underwriting policies and approach through the cycle we have been -- and Ajai just mentioned this, very consistent approach through the cycle. What we've seen in the marketplace is a pricing dynamic in some cases that we aren't willing to match from an economic standpoint, and some covenants that don't meet our risk appetite. And so taken in combination we're making prudent decisions and walking away sometimes when it doesn't make sense. As it relates to resi versus non-resi we would be sticking with core high-quality clients in the resi category, and as I said just continuing to make prudent business decisions going forward.

Thank you for that and I know we're in a bit of a rush here, but I want to sneak one in for the U.S. business. Our FDIC [ph] premiums are no longer deductible I think in calendar 2019. Is that going to be having a big impact on your profit growth outlook for next year in that business?

It's like we look at a whole host of issues going into the New Year, it is one aspect of it, and obviously this was just announced. And effective for 11/1 going into 2019, so we'll work through it but we see this as a manageable item for the upcoming year.

We'll take our next question from Steve [ph]. [Operator Instructions].

For Terry, there is obviously noise in the hillock versus the mortgage line; but in aggregate, do you look like you're continuing to take market share almost 7% rev [ph] growth this quarter. Can you talk about your outlook for next year? 2018 has featured a lot of share growth but looking ahead, the hillocks [ph] start to normalize, come off the boil, or do you think you still have more market share to gain in '19?

So we would continue to be looking at mid-single digit growth for our proprietary total real estate secured lending portfolio in '19. The reason we feel comfortable with that, the reasons actually remains similar to what we've talked about in the past, as you'll recall with the Hillock [ph] hybrid mortgage product, we've made many improvements to that product to make it a real mortgage substitute, a convenient and flexible option for the right customers, were fourth in market share in that category, and so the growth in originations we're seeing is about 90% to existing TD customers, and we're comfortable that we will continue to grow our business in that regard to customers who love us for their day-to-day banking and have borrowing needs or borrowing elsewhere. In addition to that, we've continued to invest in our mobile mortgage specialists and have added just shy of 250 year-over-year, so they're an opportunity to meet our customers in their channel-of-choice. We've continued to invest in our homeowner journey end-to-end digital capabilities, and the pre-approval capability that we launched just a few months ago has delivered strong pre-approval volumes and is delivering our good business as well. We have continued to invest in our credit operation center, so that's helping us to adjudicate loans more quickly and get customers to the answer they are looking for more quickly which meets their needs. And then finally, we've been helping to train our people in our branches to ensure that our advisors are confident to meet our customer's needs. So in aggregate, with those investments we do see the prospect of similar growth next year. What I would say is that there was some pull-forward obviously with B20 [ph] launched January of 2018, so we could see the rate of growth a little bit lower in the first half but still looking at mid-single digits for the full year.

Just a quick one for Riaz, a bit of an odd one. The professional advisory services line, it's up like $100 million quarter-on-quarter and year-on-year; that's a pretty big number for advisory services, or anything outsized or anything you mentioned there?

I think it's mostly in relation to all the various initiatives that we have underway and the execution of those initiatives. So I think you should look at it in the context of continuing to just build our systems and capabilities out.

[Operator Instructions] We'll take our next question from Sumit Malhotra.

Maybe a couple of clarification questions to start on numbers-wise for Riaz. Just on capital, from the level you're at right now, if I think about the items we know that are coming; Greystone, MEA [ph], and the RWA updates, is 30 to 35 basis points an appropriate range for the impact of those three combined?

I think assuming that that would be a reasonable consideration, as you know, our RWA growth can bounce around from time-to-time but yes, about 30 basis points should be about right.

And then, when you were going through your prepared comments for the U.S. segment; you mention the ROE which has moved up nicely this year. When I look at your sub-back on Page 6, and I'll start by saying I know there is moving parts when we look at segmented returns on equity or returns on capital. But your equity base that you show us in that segment hasn't really changed much in the last couple of years even though, obviously you've been running new business, you've been increasing your earnings power. How does that get allocated because I would think equity would grow alongside what's happening in the business? And I apologize if this is something I should know and I've forgotten but any help there would be appreciated.

No, I think you're quite correct Sumit in pointing that out but the allocation is based on required equity and as our systems of risk measurement and risk weighted assets measurement mature you see some benefit of that accruing to that line and so you're quite correct that it's been fairly stable but you should think about it in the context of -- that it's coincidentally stable and not that it doesn't reflect appropriate volume growth.

So even with RWA up $9 million to $10 million year-over-year, the equity requirement in the business doesn't move alongside of that?

Well, because I think when the RWA grows, there are other factors in the calculation of capital that may offset it Sumit, and so we'll -- we can take it through that calculation if you'd like to.

[Operator Instructions] We'll take our last question from Nigel D'Souza.

I just want to follow-up on gross and fair loans for the quarter and touch on the point you made on seasonality. So I understand the seasonality effects in Q1, especially in credit cards from potential hangover related to a holiday shopping and spending there, but could you kind of provide more color on what type of seasonal factors you see impacting autos and credit cards in Q4?

What actually occurs is right starting from the back-to-school period, going upto the end of the holiday shopping season, you do see a buildup at volumes and you do see delinquency pressures because consumer wallets are stretched; so when you see the delinquency numbers go up that attracts seasonally performing PCL and that continues to build right I would say in Q4 and Q1, Q1 tends to be the high watermark. And then as customers get their tax refunds in Q2 you start seeing that number come down. I would actually encourage you to go to the U.S. retail PCL numbers, look at the last three quarters and look at the change between Q3, Q4 and Q1 each year, you'll see it there.

When I look at the breakdown of impaired loans and this is on Page 20 of your supplement pack, there is 120 build in your industrial construction and trade contractors bucket in Q4 relative to Q3. Could you speak to or just press more color what exactly impacted that line item?

So I would -- so it seems that line item, I would call it isolated, quite frankly, and from my perspective it's well secured. I'd actually be very surprised to see any credit losses, so you should think of it more of as isolated.

We'll take our next question from Mariel Mendonca [ph].

Ajai, just to sort of follow-up on that last question; you said it was well secured that impairment, is it fair to say there have been no PCLs on that line item at all?

There are minimal PCLs I'd say, it's well secured. It's isolated and it's very, very nominal. I believe that that could…

And you see no trends that you would highlight in any other loans in that category then, that's specific to that one?

I don't and that's why the use of the word isolated.

One follow-up, and this is more of a general question that I've asked a few now -- a few banks. On Page 30 of your supplement, you first specifically to -- you offer some pretty good detail on the PCL ratios in various categories and specifically in business and government, the PCL ratio is only 3 basis points and that's been true for your bank, and frankly, all the banks now for some time. Can you help me think through like what is a -- an average is always a tough word but what do you think is a normal level of PCLs for business loans for you -- for TD or a bank generally in Canada?

I mean, I think the PCLs have been in single digits. I would say probably in the 10 to 15 basis point range. Again, we've been in a very, very benign environment for a long time and I think over a period of time you'll see some normalization. But again from what I'm seeing there is nothing on the horizon, our portfolio quality is pretty strong right now and as Bharat said, the economic outlook continues to be reasonable as well but as the cycle changes, some normalization of credit in commercial will occur.

And when you offer that outlook of say -- I think you said 40 to 40 basis points for 2019. What number is in your mind -- at the back of your mind for the business loans; is it something like 10 basis points? Is that reasonable to get you to the 40 to 45?

I mean, I don't have that detail available but I'll tell you, like -- in the 40 to 45 basis points I have assumed some normalization of commercial credit in Canada, some normalization of commercial credit in the United States, and certainly some normalization of commercial credit or wholesale credit in the dealer.

[Operator Instructions] We'll take our next question from Sohrab Movahedi.

On the U.S. segment, the U.S. loan growth; it kind of continues to be in that low single digit. Talk us through a little bit how -- what's the outlook for that?

As we've been talking for the last several quarters now, we've been saying very directly at these quarterly calls that more moderate loan growth would be expected across a number of portfolios. I think as we've come into more of our size and some of our commercial and corporate and specialty portfolios, A) that would have naturally brought down the growth rate you would have seen from a few years ago; market conditions, that we've been talking about and there is certainly high demand for quality paper out there amongst all of the banks. There is also other macroeconomic factors of slowdown in M&A and customers, and many of our commercial and corporate clients are quite flush with cash on their own balance sheets these days. On the consumer side, it's also been more moderate; I think you would have seen many of the U.S. banks calling down home equity and mortgage rates as the refinance boom has slowed, especially given a rising rate environment. That said, I would just say that for our business in the U.S. we still believe that we can continue to take share and while these number on any given quarter will bump around a bit, we continue to believe we will remain an outlier in growth and while 3% growth is a little bit more muted, as I said at the upfront, it continues especially amongst our peer banks in the U.S. and larger banks continue to put us at the top of the pack. If you look at some of the quarter-over-quarter number, Q3 to Q4, you would have seen a decent growth from Q3 to Q4, and I think this does bode well going into the new year. But all things being equal, we think we'll continue to take share on both, personal loans and commercial loans going forward.

Ajai, did you disclose the oil and gas exposure because you're worried about it or just because you thought we would be asking about it?

I think it's topical, so I disclosed it. Quite frankly, I'm not worried about it because our quality is very, very good. And as you saw the slide, and I highlighted the impaired levels, quite frankly, they are negligible; so we are not seeing any quality issues either on the non-retail side and even retail so far is pretty strong but it's topical and I thought it was appropriate to highlight it.

Understood. And maybe if I can just sneak one in for Terry as well; maybe it's a better conversation Terry for next quarter but given the Aeroplan announcement, I was a little bit perplexed that after as many credit card transactions that the bank has done over the years there is still a need to call out charges related to systems that you think you're going to have to take over the next couple of years. Can you elaborate on that right now or is it better we wait until next quarter?

No, I'm happy to elaborate on it. So delighted to be in the position as Bharat said, to have been able to announce this long-term partnership and to be the primary credit card issuer for the Air Canada loyalty program. It is the -- Aeroplan has been the premier loyalty program in Canada and we are very excited about the offering with Air Canada going forward. As we work through the partnership and launching value for both, the current and prospective card holders. Over the next couple of years we did identify about $100 million in investment, that will be launching some new cards in the lineup, it will be rebranding for the new value proposition and lining up to the offers available going forward. It will also be enhanced some digital and channel capabilities with the opportunity to interact in Air Canada channels, and that will allow us to provide for cardholders a more personalized experience, and offers that are relevant to their travel preferences, and some of these investments we'll be able to be leveraged more broadly in our visa portfolio; so when we take a look at what we will be delivering for our -- for Canadians and for our current card holders and the cost of that versus the benefits to our business and the customers we feel very comfortable with that tradeoff.

But is some of that marketing spend?

This would be more branding and launch activities than marketing spend.

I think of them both as the same thing. Thank you.

Maybe the way to say it is, the cards will need to be rebranded to Air Canada cards.

We'll now take our next question from Darko Mihelic.

I just have a couple of questions. The first is, just wanted to verify the bounce in trading from last quarter, just a reversal of what happened last quarter and I think you guys are musing about changing your accounting for trading; is that -- has that occurred? I didn't quite catch it.

There was a modest reversal of -- would occurred in terms of mark-to-market of the trading deposits in Q3 which was outsized, so there was some benefit in Q4. And I think we've said that for the year that line item was dominimus [ph] for the year but there was unfortunately a volatility in Q3. And we are moving to account for that line item or those mark-to-market through the fair value OCI Convention, that starts in this quarter. So it will reduce volatility once the whole book gets remarked in that fashion, in the interim of the outstanding book though however we'll still be going through P&L.

And I think really, the -- when you look at the trading revenue quarter, in the last number of years the quarterly range has averaged around 4.25 to 4.50 but there is volatility in trading revenue. So this quarter was modestly ahead of what the average has been but meaningfully ahead of both, the previous quarter and year ago's quarter, both of those quarters were weak quarters, hence a pretty large increase; it's not a large increase relative to the average but it's a large increase relative to weak quarters and that we're the competitors.

So presumably some of the volatility of trading revenues though should decline in the go-forward basis under the new accounting approach or...

Yes. That is due to the -- the volatility related thereto -- related to the market and trading causes, so we'll now go through OCI, so that will come out. And I think we've always felt that these are -- there is inherent volatility in trading revenues caused by markets, as well as positions and the combination of the two. So, I think when you look on an annual basis there is a reasonable amount of stability but the inter periods are volatile as you noted.

And if I could just turn to the U.S. retail segment, just for -- a kind of a discussion I suppose on the outlook for the net interest margin. And maybe you can help me understand -- I mean sometimes in the -- we get annual disclosures and sometimes things pop out at me that look a little bit peculiar and the one thing that really popped out for me in the annual report was when I looked at the cost of our U.S. business deposits, it looks like they almost doubled year-over-year and went from 211 basis points to 419. And I'm just wondering if that was an anomaly and if that maybe sort of slowed down the NIM expansion and maybe looking forward we should expect -- well maybe, I'll just leave it there or maybe you can let me know if the forward NIM outlook for the U.S. is maybe more robust than what we saw in 2018?

First, I should probably level set that as we'll talk here quarter-after-quarter, any given quarter the NIM given so many inputs into that equation will bump around and if I just take you back to the comparison from Q2 to Q3, we were up quite healthy 10 basis points, quarter-over-quarter. And in Q4 on a Q-over-Q basis it was flat and I would primarily signal that it was mostly because of mix even though we had one rate hike halfway through Q4. I would just provide maybe just a little bit of a view in that, in Q1 we would expect another increase in our net interest margin, just from the basis of what we have rolling off in our investment portfolio and the on/off rate for -- versus old investments versus where the market is today. So I'd say that we would expect further NIM expansion in Q1.

Darko, I'll just add to that. I think the table that you're looking at is specifically the business and government U.S. line where as interest rates come up, betas and business and government deposits tend to give it…

And maybe I would just add a little on the beta's Riaz. Darko, you know, we watch this very, very closely and we get asked the question well. X sweeps, deposit rates are a little slower than we would have seen in the past few years, we're 4% up year-over-year, still quite healthy comparison against most of our peers are in zero to very low-single digits, we continue to take share but I'll go to the quality story, especially at this point of the rate cycle. And if you look at our consumer DDA balances, those consumer balances are up 7% year-over-year, small business checking account balances are up over 5% year-over-year. And -- so the headline number for growth is one thing but we're also paying very close attention to the whole beta conversation and it should be also a lens of quality of growth and not just chasing half deposits.

I mean, I guess what I was getting at was the deposit data just seemed overtly high on the business side. And I was just wondering if that was -- I guess it didn't impacted the overall margin as much as I thought it would; so we can take that question offline if at all possible, I just want to follow-up on that.

Yes, we have to do it because I would generally say that our beta's are well within our peer range across interest bearing and non-interest bearing products, and we can certainly follow-up on that.

We'll now take our next question from Meny Grauman.

A question from the annual report, your macroeconomic variables in the scenario analysis; oil prices seem to be conspicuously missing from there. So I'm just wondering, I guess you have a wide range of variables to choose from but is there anything in that that you don't feel it is as important a variable in your scenario analysis?

It's Ajai, let me answer that. So I think oil prices are important but they're an input into our macroeconomic model; so to the extent they impact GDP or unemployment, they certainly drive our moderate results. So they are important but they are an input into the model.

And then if I can just ask about TD Ameritrade and the question really is, do you feel that this -- that this business is going to be a drag when it comes to 2019, just on a growth basis you talked about just how strong the year was for this business in 2018 and I'm wondering how you're approaching the outlook for 2019. I know there is an element of market dependency but what's prudent here in terms of expectations?

As you now walk through 2018 and as you can see in TD Ameritrade's own disclosures that there was a number of tailwind that contributed to their performance, the non-recurring one would obviously be our U.S. tax reform but the ones that are more sustainable are the lift in interest rates as well as the additional customers and volumes that were made available via the Scottrade acquisition but also a higher level of general trading activity in the markets. So I think you can look at the guidance that TD Ameritrade gives in relation to it's earnings and you'll conclude -- you'll see that they continue to feel that there is still a fair bit of growth to go here.

[Operator Instructions] We'll take our next question from Doug Young [ph].

Bank just backed to the U.S. NIMs, I'm just hoping to get a little bit of color on your outlook more on NIM in the context of mix shift versus deposit margins versus loan yields. And specifically on the loan yield side, are you starting to see -- because loan growth has been so slow; are you starting to see an increased competitive pressure and pressure on the loan yields yet or that does not exist at this point?

No, I think -- first, I'd say just on the commercial portfolios, it certainly has been very competitive in the markets for quality drawn paper across many segments and industries. And our view of this has been, first, we're going to have a lens from a risk appetite standpoint and we're just not going to go out on the curve, notwithstanding where we feel we might be late in the cycle and we're going to be conservative of what we do. And secondly, I would say that our view of growth -- I'll go back to the quality story that I mentioned on deposits. We're going to grow from a credit quality standpoint and from a return standpoint, and a relationship standpoint; and if we can't get it those ways, we walk away from a lot of transactions every day. But notwithstanding that we still think we can continue to outpace the growth of the market and we think we've got room to run. On the consumer side, there is a dynamic going on, refi's have been very slow, most banks have got double-digit decline in home equity balances with a rising rate, and certainly we've been growing cards and auto a little quicker given we would subscale or relatively smaller players in those businesses over the last several years. And that's why we would -- on the other side of it we'd call out the increases in PCL given mix and the growing balances around those portfolios, so that's been a focused area of growth and we think we're still doing it the right way for us.

Just on the NIM outlook, is most of the uptake really going to come on the deposit margin side; is that really -- or is there a little bit of mix left in there that come through?

So for us the way we would look at it, the loans are a spread business, and the way we would look at the deposit book of businesses, that's why we're so focused on quality growth is that we want DDAs and we don't want the hot money growth, and we want deposits that can be invested longer term. And we do think all things being equal, in a rising rate environment we're managing beta's quite well and we think rates continue to rise over '19 and NIM should generally be higher.

And then Bharat, I mean it's a good problem to have 12% CET1 ratio, obviously, some of that comes back next quarter with some of the transactions you've done. I mean, everyone always talks about what's the minimum level of CET1 ratio but what's the maximum you're willing to take this upto? And why not be a little more aggressive on the buyback or at least put in a little bit more that you could be -- have a little bit more tool on the buyback?

We've talked about other banks capital framework, how we think about capital and I won't go through all the details; but you know, we have terrific opportunities to continue to invest in our businesses. We will look at M&A transactions, if they make financial and risk sense to us and strategic sense to us, there are certain areas we've outlined that we would be quite interested in. And on top of that, we -- last year we announced the 20 million share buyback and we completed it, and we announced another one this quarter; so I feel quite comfortable, we continue to apply our framework in a disciplined way. And if circumstances suggest that we should up our buyback then we will certainly consider it, and that's how I'm looking at this Doug. It's a consistent story from us, nothing different.

Ladies and gentlemen, unfortunately, that's all the time for questions that we have today. And at this time, I would like to turn the conference back over to Mr.Bharat Masrani for closing remarks.

Thank you, operator. And thank you to all of you for joining us this afternoon. And I'm very happy with how the bank and the numbers the bank has delivered for the quarter, that caps off a great year at TD. I do want to take this opportunity to thank our dedicated and great employees around the world, 85,000 strong, who continue to deliver for all of our stakeholders including our shareholders. So a big thank you from all of us here. And as well for folks on the phone, it is that time of the year, in case if we do not meet in the next few weeks then wish you the very best for the holidays, and we'll see you in the New Year. Thank you.

This concludes today's call. Thank you for your participation. You may not disconnect.