ASSET ENCUMBRANCE


In the course of the Bank’s day-to-day operations, securities and other assets are pledged to obtain funding, support trading and prime brokerage businesses, and participate in clearing and/or settlement


T ABLE 57 ENCUMBERED AND UNENCUMBERED ASSETS1 (millions of Canadian dollars, except as noted) Encumbered2


Pledged as collateral3


Cash and due from banks


Interest-bearing deposits with banks Securities, trading loans, and other7 Derivatives


Securities purchased under reverse repurchase agreements8 Loans, net of allowance for loan losses Customers’ liability under acceptances Investment in TD Ameritrade Goodwill


Other intangibles


Land, buildings, equipment, and other depreciable assets Deferred tax assets Other assets9


Total on-balance sheet assets


Off-balance sheet items10 Securities purchased under reverse repurchase agreements Securities borrowing and collateral received Margin loans and other client activity


Total off-balance sheet items Total


Total on-balance sheet assets Total off-balance sheet items Total


1 2 $ – 4,904


42,019 – –


22,943 – – – – – –


542 $ 70,408


66,538 26,527 3,380


96,445 $ 166,853


$ 84,327 98,447


$ 182,774


Certain comparative amounts have been restated to conform with the presentation adopted in the current year.


Asset encumbrance has been analyzed on an individual asset basis. Where a particular asset has been encumbered and TD has holdings of the asset both on-balance sheet and off-balance sheet, for the purpose of this disclosure, the on and off-balance sheet holdings are encumbered in alignment with the business practice.


3


Represents assets that have been posted externally to support the Bank’s liabilities and day-to-day operations, including securities related to repurchase agreements, securities lending, clearing and payment systems, and assets pledged for derivative transactions. Also includes assets that have been pledged supporting Federal Home Loan Bank (FHLB) activity.


4


Assets supporting TD’s funding activities, assets pledged against securitization liabilities, and assets held by consolidated securitization vehicles or in pools for covered bond issuance.


5


Assets that are considered readily available in their current legal form to generate funding or support collateral needs. This category includes reported FHLB assets that remain unutilized and held-to-maturity securities that are available for collateral purposes however not regularly utilized in practice.


6 $


Other4 –


1,200


11,736 – –


53,393 – – – – – – –


$ 66,329 –


569 –


569 $ 66,898


$ 61,731 –


$ 61,731


Available as collateral5


$ – 43,714


227,909 – –


74,077 – – – – – – –


$ 345,700


35,272 18,314 14,725


68,311 $ 414,011


$ 285,773 51,678


$ 337,451 Unencumbered Encumbered Other6


$ 3,907 3,896


13,842 72,242 86,052


435,243 15,706 7,091


16,662 2,639 5,482 2,084


29,684 $ 694,530


(86,052) –


(8,747) (94,799)


$ 599,731 October 31, 2015


$ 672,542 (104,452)


$ 568,090


Assets that cannot be used to support funding or collateral requirements in their current form. This category includes those assets that are potentially eligible as funding program collateral (for example, CMHC insured mortgages that can be securitized into NHA MBS).


7


Securities include trading loans, securities, and other financial assets designated at fair value through profit or loss, available-for-sale securities, and held-to- maturity securities.


8


Assets reported in Securities purchased under reverse repurchase agreements represent the value of the loans extended and not the value of the collateral received.


9 Other assets include amounts receivable from brokers, dealers, and clients. 10


Off-balance sheet items include the collateral value from the securities received under reverse repurchase agreements, securities borrowing, margin loans, and other client activity. The loan value from the reverse repurchase transactions and margin loans/client activity is deducted from the on-balance sheet Unencumbered – Other category.


$ 1,104,373 13.2% $


Total assets as a % assets of total assets


3,907 53,714


295,506 72,242 86,052


585,656 15,706 7,091


16,662 2,639 5,482 2,084


30,226 $ 1,176,967 –%


0.5 4.6 – –


6.5 – – – – – – –


11.6% As at October 31, 2016


systems. In addition to liquid assets, a summary of encumbered and unencumbered assets (excluding assets held in insurance subsidiaries) is presented in the following table to identify assets that are used or available for potential funding needs.


94 TD BANK GROUP ANNUAL REPORT 2016 MANAGEMENT’S DISCUSSION AND ANALYSIS


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