Summary of Material Accounting Policies (Policies)	12 Months Ended
Oct. 31, 2025
Summary of Material Accounting Policies [Abstract]
Basis of Consolidation	BASIS OF CONSOLIDATION The Consolidated Financial Statements include the assets, liabilities, results of operations, and cash flows of the Bank and its subsidiaries including certain structured entities which it controls. The Bank’s Consolidated Financial Statements have been prepared using uniform accounting policies for like transactions and events in similar circumstances. All intercompany transactions, balances, and unrealized gains and losses on transactions are eliminated on consolidation. Subsidiaries Subsidiaries are corporations or other legal entities controlled by the Bank, generally through directly holding more than half of the voting power of the entity. Control of subsidiaries is determined based on the power exercisable through ownership of voting rights and is generally aligned with the risks and/or returns (collectively referred to as “variable returns”) absorbed from subsidiaries through those voting rights. As a result, the Bank controls and consolidates subsidiaries when it holds the majority of the voting rights of the subsidiary, unless there is evidence that another investor has control over the subsidiary. The existence and effect of potential voting rights that are currently exercisable or convertible are considered in assessing whether the Bank controls an entity. Subsidiaries are consolidated from the date the Bank obtains control and continue to be consolidated until the date when control ceases to exist. The Bank may consolidate certain subsidiaries where it owns 50% or less of the voting rights. Most of those subsidiaries are structured entities as described in the following section. Structured Entities Structured entities are entities created to accomplish a narrow and well-defined objective. Structured entities may take the form of a corporation, trust, partnership, or unincorporated entity. They are often created with legal arrangements that impose limits on the decision-making powers of their governing board, trustee, or management. Structured entities are consolidated when the substance of the relationship between the Bank and the structured entity indicates that the Bank controls the entity. When assessing whether the Bank has to consolidate a structured entity, the Bank evaluates three primary criteria in order to conclude whether, in substance: ● The Bank has the power to direct the activities of the structured entity that have the most significant impact on the entity’s variable returns; ● The Bank is exposed to significant variable returns arising from the entity; and ● The Bank has the ability to use its power to affect the variable returns to which it is exposed. Consolidation conclusions are reassessed at the end of each financial reporting period. The Bank’s policy is to consider the impact on consolidation of all significant changes in circumstances, focusing on the following: ● Substantive changes in ownership, such as the purchase or disposal of more than an insignificant interest in an entity; ● Changes in contractual or governance arrangements of an entity; ● Additional activities undertaken, such as providing a liquidity facility beyond the original terms or entering into a transaction not originally contemplated; ● Changes in the financing structure of an entity; and ● Changes in the rights to exercise power over an entity.
Investments in Associates and Joint Ventures	INVESTMENTS IN ASSOCIATES AND JOINT VENTURES Entities over which the Bank has significant influence are associates and entities over which the Bank has joint control are joint ventures. Significant influence is the power to participate in the financial and operating policy decisions of an investee, but is not control or joint control over these entities. Significant influence is presumed to exist where the Bank holds between 20 % and 50 % of the voting rights of an entity. Significant influence may also exist where the Bank holds less than 20 % of the voting rights and has influence over financial and operating policy-making processes, through board representation and significant commercial arrangements. Associates and joint ventures are accounted for using the equity method of accounting. Investments in associates and joint ventures are carried on the Consolidated Balance Sheet initially at cost and increased or decreased to recognize the Bank’s share of the profit or loss of the associate or joint venture, capital transactions, including the receipt of any dividends, and write-downs to reflect any impairment in the value of such entities. These increases or decreases, together with any gains and losses realized on disposition, are reported on the Consolidated Statement of Income. The carrying amount of the investments also includes the Bank’s share of the investee’s other comprehensive income or loss, which is reported in the relevant section of the Consolidated Statement of Comprehensive Income. At each balance sheet date, the Bank assesses whether there is any objective evidence that the investment in an associate or joint venture is impaired. The Bank calculates the amount of impairment as the difference between the higher of fair value or value-in-use and its carrying value.
Cash and Due From Banks	CASH AND DUE FROM BANKS Cash and due from banks consist of cash and amounts due from banks which are issued by investment grade financial institutions. These amounts are due on demand or have an original maturity of three months or less.
Revenue Recognition	REVENUE RECOGNITION Revenue is recognized at an amount that reflects the consideration the Bank expects to be entitled to in exchange for transferring services to a customer, excluding amounts collected on behalf of third parties. The Bank recognizes revenue when it transfers control of a good or a service to a customer at a point in time or over time. The determination of when performance obligations are satisfied requires the use of judgment. Refer to Note 3 for further details. The Bank identifies contracts with customers subject to IFRS 15, Revenue from Contracts with Customers , which create enforceable rights and obligations. The Bank determines the performance obligations based on distinct services promised to the customers in the contracts. The Bank’s contracts generally have a term of one year or less, consist of a single performance obligation, and the performance obligations generally reflect services. For each contract, the Bank determines the transaction price, which includes estimating variable consideration and assessing whether the price is constrained. Variable consideration is included in the transaction price to the extent that it is highly probable that a significant reversal of the amount will not occur when the uncertainty associated with the amount of variable consideration is subsequently resolved. As such, the estimate of the variable consideration is constrained until the end of the invoicing period. The uncertainty is generally resolved at the end of the reporting period and as such, no significant judgment is required when recognizing variable consideration in revenues. The Bank’s receipt of payment from customers generally occurs subsequent to the satisfaction of performance obligations or a short time thereafter. As such, the Bank has not recognized any material contract assets (unbilled receivables) or contract liabilities (deferred revenues) and there is no significant financing component associated with the consideration due to the Bank. When another party is involved in the transfer of services to a customer, an assessment is made to evaluate whether the Bank is the principal such that revenues are reported on a gross basis or the agent such that revenues are reported on a net basis. The Bank is the principal when it controls the services in the contract promised to the customer before they are transferred. Control is demonstrated by the Bank being primarily responsible for fulfilling the transfer of the services to the customer, having discretion in establishing pricing of the services, or both. Investment and securities services Investment and securities services income includes asset management fees, administration and commission fees, and investment banking fees. The Bank recognizes asset management and administration fees based on time elapsed, which depicts the rendering of investment management and related services over time. The fees are primarily calculated based on average daily or point in time assets under management (AUM) or assets under administration (AUA) depending on the investment mandate. Commission fees include sales, trailer and brokerage commissions. Sales and brokerage commissions are generally recognized at a point in time when the transaction is executed. Trailer commissions are recognized over time and are generally calculated based on the average daily net asset value of the fund during the period. Investment banking fees include advisory fees and underwriting fees and are generally recognized at a point in time upon successful completion of the engagement. Credit fees Credit fees include liquidity fees, restructuring fees, letter of credit fees, and loan syndication fees. Liquidity, restructuring, and letter of credit fees are recognized in income over the period in which the service is provided. Loan syndication fees are generally recognized at a point in time upon completion of the financing placement. Service charges Service charges income is earned on personal and commercial deposit accounts and consists of account fees and transaction-based service charges. Account fees relate to account maintenance activities and are recognized in income over the period in which the service is provided. Transaction-based service charges are recognized as earned at a point in time when the transaction is complete. Card services Card services income includes interchange income as well as card fees such as annual and transactional fees. Interchange income is recognized at a point in time when the transaction is authorized and funded. Card fees are recognized as earned at the transaction date with the exception of annual fees, which are recognized over a twelve-month period.
Financial Instruments	FINANCIAL INSTRUMENTS Classification and Measurement of Financial Assets The Bank classifies its financial assets into the following categories: ● Amortized cost; ● Fair value through other comprehensive income (FVOCI); ● Held-for-trading; ● Non-trading fair value through profit or loss (FVTPL); and ● Designated as measured at FVTPL. The Bank recognizes financial assets on a settlement date basis, except for derivatives and securities, which are recognized on a trade date basis. Debt Instruments The classification and measurement for debt instruments is based on the Bank’s business models for managing its financial assets and whether the contractual cash flows represent solely payments of principal and interest (SPPI). Refer to Note 3 for judgment with respect to the determination of the Bank’s business models and whether contractual cash flows represent SPPI. The Bank has determined its business models as follows: ● Held-to-collect: the objective is to collect contractual cash flows; ● Held-to-collect-and-sell: the objective is both to collect contractual cash flows and sell the financial assets; and ● Held-for-sale and other business models: the objective is neither of the above. The Bank performs the SPPI test for financial assets held within the held-to-collect and held-to-collect-and-sell business models. If these financial assets have contractual cash flows which are inconsistent with a basic lending arrangement that do not pass the SPPI test, they are classified as non-trading financial assets measured at FVTPL. In a basic lending arrangement, interest includes consideration for time value of money, credit risk, other basic lending risks, and a reasonable profit margin. Debt Securities and Loans Measured at Amortized Cost Debt securities and loans held within a held-to-collect business model where their contractual cash flows pass the SPPI test are measured at amortized cost. The carrying amount of these financial assets is adjusted by an allowance for credit losses recognized and measured as described in the Impairment – Expected Credit Loss Model section of this Note, as well as any write-offs and unearned income which includes prepaid interest, loan origination fees and costs, commitment fees, loan syndication fees, and unamortized discounts or premiums. Interest income is recognized using EIRM. The effective interest rate (EIR) is the rate that discounts expected future cash flows for the expected life of the financial instrument to its carrying value. The calculation takes into account the contractual interest rate, along with any fees or incremental costs that are directly attributable to the instrument and all other premiums or discounts. Loan origination fees and costs are considered to be adjustments to the loan yield and are recognized in interest income over the term of the loan. Commitment fees are recognized in credit fees over the commitment period when it is unlikely that the commitment will be called upon; otherwise, they are recognized in interest income over the term of the resulting loan. Loan syndication fees are recognized in credit fees upon completion of the financing placement unless the yield on any loan retained by the Bank is less than that of other comparable lenders involved in the financing syndicate. In such cases, an appropriate portion of the fee is recognized as a yield adjustment in interest income over the term of the loan. Debt Securities and Loans Measured at Fair Value through Other Comprehensive Income Debt securities and loans held within a held-to-collect-and-sell business model where their contractual cash flows pass the SPPI test are measured at FVOCI. Fair value changes are recognized in other comprehensive income, except for impairment gains or losses, interest income and foreign exchange gains and losses on the instrument’s amortized cost, which are recognized in the Consolidated Statement of Income. Interest income is recognized using EIRM. The expected credit loss (ECL) allowance is recognized and measured as described in the Impairment – Expected Credit Loss Model section of this Note. When the financial asset is derecognized, the cumulative gain or loss previously recognized in other comprehensive income is reclassified from equity to income and recognized in other income (loss). Financial Assets Held-for-Trading The held-for-sale business model includes financial assets held within a trading portfolio, which have been originated, acquired, or incurred principally for the purpose of selling in the near term, or if they form part of a portfolio of identified financial instruments that are managed together and for which there is evidence of short-term profit-taking. Financial assets held within this business model consist of trading securities, trading loans, as well as certain securities purchased under reverse repurchase agreements. Trading portfolio assets are accounted for at fair value with changes in fair value recognized in trading income (loss). Transaction costs are expensed as incurred. Dividends are recognized on the ex-dividend date and interest is recognized on an accrual basis. Both dividends and interest are included in interest income. Non-Trading Financial Assets Measured at Fair Value through Profit or Loss Non-trading financial assets measured at FVTPL include financial assets held within the held-for-sale and other business models, for example debt securities and loans managed on a fair value basis. Financial assets held within the held-to-collect or held-to-collect-and-sell business models that do not pass the SPPI test are also classified as non-trading financial assets measured at FVTPL. Changes in fair value as well as any gains or losses realized on disposal are recognized in other income (loss). Interest income from debt instruments is included in interest income on an accrual basis. Financial Assets Designated at Fair Value through Profit or Loss Debt instruments in a held-to-collect or held-to-collect-and-sell business model can be designated at initial recognition as measured at FVTPL, provided the designation can eliminate or significantly reduce an accounting mismatch that would otherwise arise from measuring these financial assets on a different basis. The FVTPL designation is available only for those financial instruments for which a reliable estimate of fair value can be obtained. Once financial assets are designated at FVTPL, the designation is irrevocable. Changes in fair value as well as any gains or losses realized on disposal are recognized in other income (loss). Interest income from these financial assets is included in interest income on an accrual basis. Equity Instruments Equity investments are required to be measured at FVTPL, except where the Bank has elected at initial recognition to irrevocably designate an equity investment, held for purposes other than trading, at FVOCI. If such an election is made, the fair value changes, including any associated foreign exchange gains or losses, are recognized in other comprehensive income and are not subsequently reclassified to net income, including upon disposal. Realized gains and losses are transferred directly to retained earnings upon disposal. Consequently, there is no review required for impairment. Dividends will normally be recognized in interest income unless the dividends represent a recovery of part of the cost of the investment. Gains and losses on trading and non-trading equity investments measured at FVTPL are included in trading income (loss) and other income (loss), respectively. Classification and Measurement for Financial Liabilities The Bank classifies its financial liabilities into the following categories: ● Held-for-trading; ● Designated at FVTPL; and ● Other liabilities. Financial Liabilities Held-for-Trading Financial liabilities are held within a trading portfolio if they have been incurred principally for the purpose of repurchasing in the near term, or form part of a portfolio of identified financial instruments that are managed together and for which there is evidence of a recent actual pattern of short-term profit-taking. Financial liabilities held-for-trading are primarily trading deposits, securitization liabilities at fair value, obligations related to securities sold short and certain obligations related to securities sold under repurchase agreements. Trading portfolio liabilities are accounted for at fair value, with changes in fair value as well as any gains or losses realized on disposal recognized in trading income (loss). Transaction costs are expensed as incurred. Interest is recognized on an accrual basis in interest expense. Financial Liabilities Designated at Fair Value through Profit or Loss Certain financial liabilities may be designated at FVTPL at initial recognition. To be designated at FVTPL, financial liabilities must meet one of the following criteria: (1) the designation eliminates or significantly reduces a measurement or recognition inconsistency; (2) the financial liabilities or a group of financial assets and financial liabilities are managed, and their performance is evaluated, on a fair value basis in accordance with a documented risk management or investment strategy; or (3) the instrument contains one or more embedded derivatives unless a) the embedded derivative does not significantly modify the cash flows that otherwise would be required by the contract, or b) it is clear with little or no analysis that separation of the embedded derivative from the financial instrument is prohibited. In addition, the FVTPL designation is available only for those financial instruments for which a reliable estimate of fair value can be obtained. Once financial liabilities are designated at FVTPL, the designation is irrevocable. Financial liabilities designated at FVTPL are carried at fair value on the Consolidated Balance Sheet, with changes in fair value as well as any gains or losses realized on disposal recognized in other income (loss), except for the amount of change in fair value attributable to changes in the Bank’s own credit risk, which is presented in other comprehensive income. Amounts recognized in other comprehensive income are not subsequently reclassified to net income upon derecognition of the financial liability; instead, they are transferred directly to retained earnings. Changes in fair value attributable to changes in the Bank’s own credit risk are measured as the difference between: (i) the period-over-period change in the present value of the expected cash flows using an all-in discount curve reflecting both the interest rate benchmark curve and the Bank’s own credit curve; and (ii) the period-over-period change in the present value of the same expected cash flows using a discount curve based solely on the interest rate benchmark curve. For loan commitments and financial guarantee contracts that are designated at FVTPL, the full change in fair value of the liability is recognized in other income (loss). Interest is recognized on an accrual basis in interest expense. Other Financial Liabilities Deposits Deposits, other than deposits included in a trading portfolio and deposits designated at FVTPL, are accounted for at amortized cost. Accrued interest on deposits is included in Other liabilities on the Consolidated Balance Sheet. Interest, including capitalized transaction costs, is recognized on an accrual basis using EIRM as Interest expense on the Consolidated Statement of Income. Subordinated Notes and Debentures Subordinated notes and debentures are accounted for at amortized cost. Accrued interest on subordinated notes and debentures is included in Other liabilities on the Consolidated Balance Sheet. Interest, including capitalized transaction costs, is recognized on an accrual basis using EIRM as Interest expense on the Consolidated Statement of Income. Reclassification of Financial Assets and Financial Liabilities Financial assets and financial liabilities are not reclassified subsequent to their initial recognition, except for financial assets for which the Bank changes its business model for managing financial assets. Such reclassifications of financial assets are expected to be rare in practice. Impairment – Expected Credit Loss Model The ECL model applies to financial assets, including loans and debt securities measured at amortized cost, loans and debt securities measured at FVOCI, loan commitments, and financial guarantees that are not measured at FVTPL. The ECL model consists of three stages: Stage 1 – Twelve-month ECLs for performing financial assets, Stage 2 – Lifetime ECLs for financial assets that have experienced a significant increase in credit risk since initial recognition, and Stage 3 – Lifetime ECLs for financial assets that are credit-impaired. ECLs are the difference between all the contractual cash flows that are due to the Bank in accordance with the contract and all the cash flows the Bank expects to receive, discounted at the original EIR. If a significant increase in credit risk has occurred since initial recognition, impairment is measured as lifetime ECLs. Otherwise, impairment is measured as twelve-month ECLs which represent the portion of lifetime ECLs that are expected to occur based on default events that are possible within twelve months after the reporting date. If credit quality improves in a subsequent period such that the increase in credit risk since initial recognition is no longer considered significant, the loss allowance reverts to being measured based on twelve-month ECLs. Significant Increase in Credit Risk For retail exposures, significant increase in credit risk is assessed based on changes in the twelve-month probability of default (PD) since initial recognition, using a combination of individual and collective information that incorporates borrower and account specific attributes and relevant forward-looking macroeconomic variables. For non-retail exposures, significant increase in credit risk is assessed based on changes in the internal risk rating (borrower risk ratings (BRR)) since initial recognition. Refer to the shaded areas of the “Managing Risk” section of the 2025 MD&A for further details on the Bank’s 21-point BRR scale to risk levels. For both retail and non-retail exposures, delinquency backstop when contractual payments are more than 30 days past due is also used in assessing significant increase in credit risk. The Bank defines default as delinquency of 90 days or more for most retail products and BRR of 9 for non-retail exposures. Exposures are considered credit- impaired and migrate to Stage 3 when the definition of default is met or when there is objective evidence that there has been a deterioration of credit quality to the extent the Bank no longer has reasonable assurance as to the timely collection of the full amount of principal and interest. When assessing whether there has been a significant increase in credit risk since the initial recognition of a financial asset, the Bank considers all reasonable and supportable information that is available without undue cost or effort about past events, current conditions, and forecast of future economic conditions. Refer to Note 3 for additional details. Measurement of Expected Credit Losses ECLs are measured as the probability-weighted present value of expected cash shortfalls over the remaining expected life of the financial instrument and consider reasonable and supportable information about past events, current conditions, and forecasts of future events and economic conditions that impact the Bank’s credit risk assessment. Expected life is the maximum contractual period the Bank is exposed to credit risk, including extension options for which the borrower has the unilateral right to exercise. For certain financial instruments that include both a loan and an undrawn commitment, and the Bank’s contractual ability to demand repayment and cancel the undrawn commitment does not limit the Bank’s exposure to credit losses to the contractual notice period, ECLs are measured over the period the Bank is exposed to credit risk. For example, ECLs for credit cards are measured over the borrowers’ expected behavioural life, incorporating survivorship assumptions and borrower-specific attributes. The Bank leverages its Advanced Internal Ratings-Based models used for regulatory capital purposes and incorporates adjustments where appropriate to calculate ECLs. Forward-Looking Information and Expert Credit Judgment Forward-looking information is considered when determining significant increase in credit risk and measuring ECLs. Forward-looking macroeconomic factors are incorporated in the risk parameters as relevant. Qualitative factors that are not already considered in the quantitative models are incorporated by applying expert credit judgment in determining the final ECLs. Refer to Note 3 for additional details. Modified Loans In cases where a borrower experiences financial difficulties, the Bank may grant certain modifications to the terms and conditions of a loan. Modifications may include payment deferrals, extension of amortization periods, rate reductions, principal forgiveness, debt consolidation, forbearance and other modifications intended to minimize the economic loss and to avoid foreclosure or repossession of collateral. The Bank has policies in place to determine the appropriate remediation strategy based on the individual borrower. If the Bank determines that a modification results in expiry of cash flows, the original asset is derecognized and a new asset is recognized based on the new contractual terms. Significant increase in credit risk is assessed relative to the risk of default on the date of modification. If the Bank determines that a modification does not result in derecognition, significant increase in credit risk is assessed based on the risk of default at initial recognition of the original asset. Expected cash flows arising from the modified contractual terms are considered when calculating ECLs for the modified asset. For loans that were modified while having lifetime ECLs, the loans can revert to having twelve-month ECLs after a period of performance and improvement in the borrower’s financial condition. Allowance for Loan Losses The allowance for loan losses represents management’s calculation of probability-weighted ECLs in the lending portfolios, including any off-balance sheet exposures, at the balance sheet date. The allowance for loan losses for lending portfolios reported on the Consolidated Balance Sheet, which includes credit- related allowances for residential mortgages, consumer instalment and other personal, credit card, business and government loans, is deducted from Loans on the Consolidated Balance Sheet. The allowance for loan losses for loans measured at FVOCI is included in the Consolidated Statement of Changes in Equity. The allowance for loan losses for off-balance sheet instruments, which relates to certain guarantees, letters of credit, and undrawn lines of credit, is recognized in Other liabilities on the Consolidated Balance Sheet. Allowances for lending portfolios reported on the balance sheet and off-balance sheet exposures are calculated using the same methodology. The allowance is increased by the provision for credit losses and decreased by write-offs net of recoveries and disposals. Each quarter, allowances are reassessed and adjusted based on any changes in management’s estimate of ECLs. Loan losses on impaired loans in Stage 3 continue to be recognized by means of an allowance for loan losses until a loan is written off. A loan is written off against the related allowance for loan losses when there is no realistic prospect of recovery. Non-retail loans are generally written off when all reasonable collection efforts have been exhausted, such as when a loan is sold, when all security has been realized, or when all security has been resolved with the receiver or bankruptcy court. Non-real estate retail loans are generally written off when contractual payments are 180 days past due, or when a loan is sold. Real estate secured retail loans are generally written off when the security is realized. The time period over which the Bank performs collection activities on the contractual amount outstanding of financial assets that are written off varies from one jurisdiction to another and generally spans between less than one year to five years. Allowance for Credit Losses on Debt Securities The allowance for credit losses on debt securities represents management’s calculation of probability-weighted ECLs. Debt securities measured at amortized cost are presented net of the allowance for credit losses on the Consolidated Balance Sheet. The allowance for credit losses on debt securities measured at FVOCI are included in the Consolidated Statement of Changes in Equity. The allowance for credit losses is increased by the provision for credit losses and decreased by write-offs net of recoveries and disposals. Acquired Performing Loans Acquired performing loans are initially measured at fair value, which considers incurred and expected future credit losses estimated at the acquisition date and also reflects adjustments based on the acquired loan’s interest rate in comparison to current market rates. On acquisition, twelve-month ECLs are recognized on the acquired performing loans, resulting in the carrying amount being lower than fair value. Acquired performing loans are subsequently accounted for at amortized cost based on their contractual cash flows and any acquisition related discount or premium, including credit-related discounts, is considered to be an adjustment to the loan yield and is recognized in interest income using EIRM over the term of the loan, or the expected life of the loan for acquired performing loans with revolving terms.
Share Capital and Other Equity Instruments	SHARE CAPITAL AND OTHER EQUITY INSTRUMENTS The Bank classifies financial instruments that it issues as either financial liabilities, equity instruments, or compound instruments. Issued instruments that are mandatorily redeemable or convertible into a variable number of the Bank’s common shares at the holder’s option are classified as liabilities on the Consolidated Balance Sheet. Dividend or interest payments on these instruments are recognized in Interest expense on the Consolidated Statement of Income. Issued instruments are classified as equity when there is no contractual obligation to transfer cash or other financial assets to redeem or convert these instruments. Such instruments, if not mandatorily redeemable or convertible into a variable number of the Bank’s common shares at the holder’s option, are classified as equity on the Consolidated Balance Sheet. Incremental costs directly attributable to the issue of equity instruments are included in equity as a deduction from the proceeds, net of tax. Dividends and distributions on these instruments are recognized as a reduction in equity. Compound instruments are comprised of both liability and equity components in accordance with the substance of the contractual arrangement. The liability component is initially measured at fair value with any residual amount assigned to the equity component. Issuance costs are allocated proportionately to the liability and equity components. Common shares, preferred shares, and other equity instruments issued and held by the Bank are classified as treasury instruments in equity, and the cost of these instruments is recorded as a reduction in equity. Upon the sale of treasury instruments, the difference between the sale proceeds and the cost of the instruments is recorded in or against contributed surplus.
Guarantees	GUARANTEES The Bank issues guarantee contracts that require payments to be made to guaranteed parties based on: (1) changes in the underlying economic characteristics relating to an asset or liability of the guaranteed party; (2) failure of another party to perform under an obligating agreement; or (3) failure of another third party to pay its indebtedness when due. Guarantees are initially measured and recorded at their fair value. The fair value of a guarantee liability at initial recognition is normally equal to the present value of the guarantee fees received over the life of the contract. The Bank’s release from risk is recognized over the term of the guarantee using a systematic and rational amortization method. If a guarantee meets the definition of a derivative, it is carried at fair value on the Consolidated Balance Sheet and reported as a derivative asset or derivative liability at fair value. Guarantees that are considered derivatives are over-the-counter (OTC) credit derivative contracts designed to transfer the credit risk in an underlying financial instrument from one counterparty to another.
Derivatives	DERIVATIVES Derivatives are instruments that derive their value from changes in underlying interest rates, foreign exchange rates, credit spreads, commodity prices, equities, or other financial or non-financial measures. Such instruments include interest rate, foreign exchange, equity, commodity, and credit derivative contracts. The Bank uses these instruments for trading and non-trading purposes. Derivatives are carried at their fair value on the Consolidated Balance Sheet. Derivatives Held for Trading Purposes The Bank enters into trading derivative contracts to meet the needs of its customers, to provide liquidity and market-making related activities, and in certain cases, to manage risks related to its trading portfolios. The realized and unrealized gains or losses on trading derivatives are recognized in trading income (loss). Derivatives Held for Non-trading Purposes Non-trading derivatives are primarily used to manage interest rate, foreign exchange, and other market risks of the Bank’s traditional banking activities. When derivatives are held for non-trading purposes and when the transactions meet the hedge accounting requirements of IAS 39, Financial Instruments: Recognition and Measurement (IAS 39), they are presented as non-trading derivatives and receive hedge accounting treatment, as appropriate. Certain derivative instruments that are held for economic hedging purposes, and do not meet the hedge accounting requirements of IAS 39, are also presented as non-trading derivatives with the change in fair value of these derivatives recognized in Non-interest income. Hedging Relationships Hedge Accounting The Bank has an accounting policy choice to apply the hedge accounting requirements of IFRS 9, Financial Instruments (IFRS 9), or IAS 39. The Bank has made the decision to continue applying the IAS 39 hedge accounting requirements and complies with the revised annual hedge accounting disclosures as required by the related amendments to IFRS 7, Financial Instruments: Disclosures (IFRS 7). At the inception of a hedging relationship, there is formal documentation of the relationship between the hedging instrument and the hedged item, its risk management objective, and strategy for undertaking the hedge. The Bank also requires a documented assessment, both at hedge inception and on an ongoing basis, of whether or not the derivatives that are used in hedging relationships are highly effective in offsetting the changes attributable to the hedged risks in the fair values or cash flows of the hedged items. In order to be considered highly effective, the hedging instrument and the hedged item must be highly and inversely correlated such that the changes in the fair value of the hedging instrument will substantially offset the effects of the hedged exposure throughout the term of the hedging relationship. If a hedging relationship becomes ineffective, it no longer qualifies for hedge accounting and any subsequent change in the fair value of the hedging instrument is recognized in Non-interest income on the Consolidated Statement of Income. Changes in fair value relating to the derivative component excluded from the assessment of hedge effectiveness are recognized in Net interest income or Non- interest income, as applicable, on the Consolidated Statement of Income. When derivatives are designated in hedge accounting relationships, the Bank classifies them either as: (1) hedges of the changes in fair value of recognized assets, liabilities or firm commitments (fair value hedges); (2) hedges of the variability in highly probable future cash flows attributable to recognized assets, liabilities or forecast transactions (cash flow hedges); or (3) hedges of net investments in foreign operations (net investment hedges). Fair Value Hedges The Bank’s fair value hedges principally consist of interest rate swaps that are used to protect against changes in the fair value of fixed-rate financial instruments due to movements in market interest rates. The change in the fair value of the derivative that is designated and qualifies as a fair value hedge, as well as the change in the fair value of the hedged item attributable to the hedged risk, is recognized in Net interest income to the extent that the hedging relationship is effective. Any change in fair value relating to the ineffective portion of the hedging relationship is recognized immediately in Non-interest income. The cumulative adjustment to the carrying amount of the hedged item (the basis adjustment) is amortized to Net interest income on the Consolidated Statement of Income based on a recalculated EIR over the remaining expected life of the hedged item, with amortization beginning no later than when the hedged item ceases to be adjusted for changes in its fair value attributable to the hedged risk. Where the hedged item has been derecognized, the basis adjustment is immediately released to Net interest income or Non-interest income, as applicable, on the Consolidated Statement of Income. Cash Flow Hedges The Bank is exposed to variability in future cash flows attributable to interest rate, foreign exchange rate, and equity price risks. The amounts and timing of future cash flows are projected for each hedged exposure on the basis of their contractual terms and other relevant factors, including estimates of prepayments and defaults. The effective portion of the change in the fair value of the derivative that is designated and qualifies as a cash flow hedge is initially recognized in other comprehensive income. The change in fair value of the derivative relating to the ineffective portion is recognized immediately in Non-interest income. Amounts in accumulated other comprehensive income (AOCI) are reclassified to Net interest income or Non-interest income, as applicable, on the Consolidated Statement of Income in the same period during which the hedged item affects income. When a hedging instrument expires or is sold, or when a hedge no longer meets the criteria for hedge accounting, any cumulative gain or loss existing in AOCI at that time remains in AOCI until the forecast transaction impacts the Consolidated Statement of Income. When a forecast transaction is no longer expected to occur, the cumulative gain or loss that was reported in AOCI is immediately reclassified to Net interest income or Non-interest income, as applicable, on the Consolidated Statement of Income. Net Investment Hedges Hedges of net investments in foreign operations are accounted for similar to cash flow hedges. The change in fair value on the hedging instrument relating to the effective portion is recognized in other comprehensive income. The change in fair value of the hedging instrument relating to the ineffective portion is recognized immediately in Non-interest income. Gains and losses in AOCI are reclassified as Non-interest income in the Consolidated Statement of Income upon the disposal or partial disposal of the investment in the foreign operation. The Bank designates derivatives and non-derivatives (such as foreign currency deposit liabilities) as hedging instruments in net investment hedges of spot or forward exchange risk. Embedded Derivatives Derivatives may be embedded in financial liabilities or other host contracts. Embedded derivatives are treated as separate derivatives when their economic characteristics and risks are not closely related to those of the host instrument, a separate instrument with the same terms as the embedded derivative would meet the definition of a derivative, and the combined contract is not measured at fair value with changes in fair value recognized in income, such as held-for-trading or designated at FVTPL. These embedded derivatives, which are bifurcated from the host contract, are recognized as Derivatives on the Consolidated Balance Sheet and measured at fair value with subsequent changes in fair value recognized in Non-interest income on the Consolidated Statement of Income.
Translation and Presentation of Foreign Currencies	TRANSLATION AND PRESENTATION OF FOREIGN CURRENCIES The Bank’s Consolidated Financial Statements are presented in Canadian dollars. Items included in the financial statements of each of the Bank’s entities are measured using their functional currency, which is the currency of the primary economic environment in which they operate. Monetary assets and liabilities denominated in a currency that differs from an entity’s functional currency are translated into the functional currency of the entity at exchange rates prevailing at the balance sheet date. Non-monetary assets and liabilities carried at cost are translated at historical exchange rates. Non- monetary assets and liabilities carried at fair value are translated at the exchange rate in effect at the balance sheet date. Revenue and expenses are translated into an entity’s functional currency at average exchange rates for the period, except for depreciation and amortization. Depreciation and amortization are translated at historical exchange rates. Translation gains and losses are included in Non-interest income except for equity investments designated at FVOCI where unrealized translation gains and losses are recorded in other comprehensive income. Foreign operations are those with a functional currency other than Canadian dollars. For the purpose of translation into the Bank’s presentation currency, all assets and liabilities are first measured in the functional currency of the foreign operation and subsequently, translated at exchange rates prevailing at the balance sheet date. Income and expenses are translated at average exchange rates for the period. Unrealized translation gains and losses relating to these foreign operations, net of gains or losses arising from net investment hedges and applicable income taxes, are included in other comprehensive income. Translation gains and losses in AOCI are recognized on the Consolidated Statement of Income upon the disposal or partial disposal of the foreign operation. The investment balance of foreign entities accounted for by the equity method, including the Bank’s investment in The Charles Schwab Corporation (“Schwab”) prior to the sale, is translated into Canadian dollars using exchange rates prevailing at the balance sheet date with exchange gains or losses recognized in other comprehensive income.
Offsetting of Financial Instruments	OFFSETTING OF FINANCIAL INSTRUMENTS Financial assets and liabilities are offset, with the net amount presented on the Consolidated Balance Sheet, only if the Bank currently has a legally enforceable right to set off the recognized amounts, and intends either to settle on a net basis or to realize the asset and settle the liability simultaneously. In all other situations, assets and liabilities are presented on a gross basis.
Determination of Fair Value	DETERMINATION OF FAIR VALUE The fair value of a financial instrument on initial recognition is normally the transaction price, as evidenced by the fair value of the consideration given or received. The best evidence of fair value is quoted prices in active markets. When there is no active market for the instrument, the fair value may be based on other observable current market transactions involving the same or similar instruments, without modification or repackaging, or based on a valuation technique which maximizes the use of observable market inputs. When financial assets and liabilities have offsetting market risks or credit risks, the Bank applies a measurement exception, as described in Note 5 under Portfolio Exception . The value determined from application of the portfolio exception must be allocated to the individual financial instruments within the group to arrive at the fair value of an individual financial instrument. Balance sheet offsetting presentation requirements, as described above under the Offsetting of Financial Instruments section of this Note, are then applied, if applicable. Valuation adjustments reflect the Bank’s assessment of factors that market participants would use in pricing the asset or liability. The Bank recognizes various types of valuation adjustments including, but not limited to, adjustments for bid-offer spreads, adjustments for the unobservability of inputs used in pricing models, and adjustments for assumptions about risk, such as the creditworthiness of either counterparty and market implied unsecured funding costs and benefits for OTC derivatives. If there is a difference between the initial transaction price and the value based on a valuation technique, the difference is referred to as inception profit or loss. Inception profit or loss is recognized upon initial recognition of the instrument only if the fair value is based on observable inputs. When an instrument is measured using a valuation technique that utilizes significant non-observable inputs, it is initially valued at the transaction price, which is considered the best estimate of fair value. Subsequent to initial recognition, any difference between the transaction price and the value determined by the valuation technique at initial recognition is recognized as non-observable inputs become observable. If the fair value of a financial asset measured at fair value becomes negative, it is recognized as a financial liability until either its fair value becomes positive, at which time it is recognized as a financial asset, or until it is extinguished.
Derecognition of Financial Instruments	DERECOGNITION OF FINANCIAL INSTRUMENTS Financial Assets The Bank derecognizes a financial asset when the contractual rights to that asset have expired. Derecognition may also be appropriate where the contractual right to receive future cash flows from the asset have been transferred, or where the Bank retains the rights to future cash flows from the asset, but assumes an obligation to pay those cash flows to a third party subject to certain criteria. When the Bank transfers a financial asset, it is necessary to assess the extent to which the Bank has retained the risks and rewards of ownership of the transferred asset. If substantially all the risks and rewards of ownership of the financial asset have been retained, the Bank continues to recognize the financial asset and also recognizes a financial liability for the consideration received. Certain transaction costs incurred are also capitalized and amortized using EIRM. If substantially all the risks and rewards of ownership of the financial asset have been transferred, the Bank will derecognize the financial asset and recognize separately as assets or liabilities any rights and obligations created or retained in the transfer. The Bank determines whether substantially all the risks and rewards have been transferred by quantitatively comparing the variability in cash flows before and after the transfer. If the variability in cash flows does not change significantly as a result of the transfer, the Bank has retained substantially all of the risks and rewards of ownership. If the Bank neither transfers nor retains substantially all the risks and rewards of ownership of the financial asset, the Bank derecognizes the financial asset where it has relinquished control of the financial asset. The Bank is considered to have relinquished control of the financial asset where the transferee has the practical ability to sell the transferred financial asset. Where the Bank has retained control of the financial asset, it continues to recognize the financial asset to the extent of its continuing involvement in the financial asset. Under these circumstances, the Bank usually retains the rights to future cash flows relating to the asset through a residual interest and is exposed to some degree of risk associated with the financial asset. The derecognition criteria are also applied to the transfer of part of an asset, rather than the asset as a whole, or to a group of similar financial assets in their entirety, when applicable. If transferring a part of an asset, it must be a specifically identified cash flow, a fully proportionate share of the asset, or a fully proportionate share of a specifically identified cash flow. Securitization Securitization is the process by which financial assets are transformed into securities. The Bank securitizes financial assets by transferring those financial assets to a third party and as part of the securitization, certain financial assets may be retained and may consist of an interest-only strip and, in some cases, a cash reserve account (collectively referred to as “retained interests”). If the transfer qualifies for derecognition, a gain or loss on sale of the financial assets is recognized immediately in other income (loss) after considering the effect of hedge accounting on the assets sold, if applicable. The amount of the gain or loss is calculated as the difference between the carrying amount of the asset transferred and the sum of any cash proceeds received, the fair value of any financial asset received or financial liability assumed, and any cumulative gain or loss allocated to the transferred asset that had been recognized in AOCI. To determine the value of the retained interest initially recorded, the previous carrying value of the transferred asset is allocated between the amount derecognized from the balance sheet and the retained interest recorded, in proportion to their relative fair values on the date of transfer. Subsequent to initial recognition, as market prices are generally not available for retained interests, fair value is determined by estimating the present value of future expected cash flows using management’s best estimates of key assumptions that market participants would use in determining such fair value. Refer to Note 3 for assumptions used by management in determining the fair value of retained interests. Retained interest is classified as trading securities with subsequent changes in fair value recorded in trading income (loss). Where the Bank retains the servicing rights, the benefits of servicing are assessed against market expectations. When the benefits of servicing are more than adequate, a servicing asset is recognized. Similarly, when the benefits of servicing are less than adequate, a servicing liability is recognized. Servicing assets and servicing liabilities are initially recognized at fair value and subsequently carried at amortized cost. Financial Liabilities The Bank derecognizes a financial liability when the obligation under the liability is discharged, cancelled, or expires. If an existing financial liability is replaced by another financial liability from the same lender on substantially different terms or where the terms of the existing liability are substantially modified, the original liability is derecognized and a new liability is recognized with the difference in the respective carrying amounts recognized on the Consolidated Statement of Income. Securities Purchased Under Reverse Repurchase Agreements, Securities Sold Under Repurchase Agreements, and Securities Borrowing and Lending Securities purchased under reverse repurchase agreements involve the purchase of securities by the Bank under agreements to resell the securities at a future date. These agreements are treated as collateralized lending transactions whereby the Bank takes possession of the purchased securities, but does not acquire the risks and rewards of ownership. The Bank monitors the market value of the purchased securities relative to the amounts due under the reverse repurchase agreements, and when necessary, requires transfer of additional collateral. In the event of counterparty default, the agreements provide the Bank with the right to liquidate the collateral held and offset the proceeds against the amount owing from the counterparty. Obligations related to securities sold under repurchase agreements involve the sale of securities by the Bank to counterparties under agreements to repurchase the securities at a future date. These agreements do not result in the risks and rewards of ownership being relinquished and are treated as collateralized borrowing transactions. The Bank monitors the market value of the securities sold relative to the amounts due under the repurchase agreements, and when necessary, transfers additional collateral or may require counterparties to return the collateral pledged. Certain transactions that do not meet derecognition criteria are also included in obligations related to securities sold under repurchase agreements. Refer to Note 9 for further details. Securities purchased under reverse repurchase agreements and obligations related to securities sold under repurchase agreements are initially recorded on the Consolidated Balance Sheet at the respective prices at which the securities were originally acquired or sold, plus accrued interest. Subsequently, the agreements are measured at amortized cost on the Consolidated Balance Sheet, plus accrued interest, except when they are held-for-trading or are designated at FVTPL. Interest earned on reverse repurchase agreements and interest incurred on repurchase agreements is determined using EIRM for agreements measured at amortized cost and recognized on an accrual basis for agreements measured at fair value, and is included in Interest income and Interest expense, respectively, on the Consolidated Statement of Income. Changes in fair value on reverse repurchase agreements and repurchase agreements that are held-for-trading or are designated at FVTPL are included in Trading income (loss) or in Other income (loss) on the Consolidated Statement of Income. In securities lending transactions, the Bank lends securities to a counterparty and receives collateral in the form of cash or securities. If cash collateral is received, the Bank records the cash along with an obligation to return the cash as Obligations related to securities sold under repurchase agreements on the Consolidated Balance Sheet. Where securities are received as collateral, the Bank does not record the collateral on the Consolidated Balance Sheet. In securities borrowing transactions, the Bank borrows securities from a counterparty and pledges either cash or securities as collateral. If cash is pledged as collateral, the Bank records the transaction as Securities purchased under reverse repurchase agreements on the Consolidated Balance Sheet. If securities are pledged as collateral, the securities remain on the Bank’s Consolidated Balance Sheet. Where securities are received or pledged as collateral, securities lending income and securities borrowing fees are recorded in Non-interest income and Non- interest expenses, respectively, on the Consolidated Statement of Income over the term of the transaction. Where cash is pledged or received as collateral, interest received or incurred is included in Interest income and Interest expense, respectively, on the Consolidated Statement of Income. Physical commodities purchased or sold with an agreement to sell or repurchase the physical commodities at a later date at a fixed price, are also included in securities purchased under reverse repurchase agreements and obligations related to securities sold under repurchase agreements, respectively, if the derecognition criteria are not met. These instruments are measured at fair value.
Goodwill	GOODWILL Goodwill represents the excess purchase price paid over the net fair value of identifiable assets and liabilities acquired in a business combination. Goodwill is carried at its initial cost less accumulated impairment losses. Goodwill is allocated to a cash-generating unit (CGU) or a group of CGUs that is expected to benefit from the synergies of the business combination, regardless of whether any assets acquired and liabilities assumed are assigned to the CGU or group of CGUs. A CGU is the smallest identifiable group of assets that generates cash flows largely independent of the cash inflows from other assets or groups of assets. Each CGU or group of CGUs, to which goodwill is allocated, represents the lowest level within the Bank at which the goodwill is monitored for internal management purposes and is not larger than an operating segment. If the composition of a CGU or group of CGUs to which goodwill has been allocated changes as a result of the sale of a business, restructuring or other changes, the goodwill is reallocated to the units affected using a relative value approach, unless the Bank can demonstrate that some other method better reflects the goodwill associated with the units affected. Goodwill is assessed for impairment at least annually and when an event or change in circumstances indicates that the carrying amount may be impaired. When impairment indicators are present, the recoverable amount of the CGU or group of CGUs, which is the higher of its estimated fair value less costs of disposal and its value-in-use, is determined. If the carrying amount of the CGU or group of CGUs is higher than its recoverable amount, an impairment loss exists. The impairment loss is recognized on the Consolidated Statement of Income and cannot be reversed in future periods.
Intangible Assets	INTANGIBLE ASSETS Intangible assets represent identifiable non-monetary assets and are acquired either separately or through a business combination, or internally generated software. The Bank’s intangible assets consist primarily of credit card related intangibles, software intangibles, and other intangibles. Intangible assets are initially recognized at cost, or at fair value if acquired through a business combination, and are amortized over their estimated useful lives ( 4 to 15 years) proportionate to their expected economic benefits, except for software which is amortized over its estimated useful life ( 3 to 7 years) on a straight-line basis. In respect of internally generated software, development costs are capitalized only if the costs can be measured reliably, the asset is technically feasible, future economic benefits are probable, and the Bank intends to and has sufficient resources to complete development of the asset. Research costs are expensed as incurred. The Bank assesses its intangible assets for impairment indicators on a quarterly basis. When impairment indicators are present, the recoverable amount of the asset, which is the higher of its estimated fair value less costs of disposal and its value-in-use, is determined. If the carrying amount of the asset is higher than its recoverable amount, the asset is written down to its recoverable amount. Where it is not possible to estimate the recoverable amount of an individual asset, the Bank estimates the recoverable amount of the CGU to which the asset belongs. If the CGU is not impaired, the useful life of the intangible asset is assessed with any changes applied on a prospective basis. An impairment loss is recognized on the Consolidated Statement of Income in the period in which the impairment is identified. Impairment losses recognized previously are assessed and reversed if the circumstances leading to the impairment are no longer present. Reversal of any impairment loss will not exceed the carrying amount of the intangible asset that would have been determined had no impairment loss been recognized for the asset in prior periods.
Land, Buildings, Equipments, and Other Depreciable Assets	LAND, BUILDINGS, EQUIPMENT, AND OTHER DEPRECIABLE ASSETS Land is recognized at cost. Buildings, computer equipment, furniture and fixtures, other equipment, and leasehold improvements are recognized at cost less accumulated depreciation and provisions for impairment, if any. Gains or losses on disposal are included in Non-interest income on the Consolidated Statement of Income. The Bank records the obligation associated with the retirement of a long-lived asset at fair value in the period in which it is incurred and can be reasonably estimated, and records a corresponding increase to the carrying amount of the asset. The asset is depreciated on a straight-line basis over its remaining useful life while the liability is accreted to reflect the passage of time until the eventual settlement of the obligation. Depreciation is recognized on a straight-line basis over the useful lives of the assets estimated by asset category, as follows: Asset Useful Life Buildings 15 to 40 years Computer equipment 2 to 8 years Furniture and fixtures 3 to 15 years Other equipment 5 to 15 years Leasehold improvements Lesser of the remaining lease term and the remaining useful life of the asset The Bank assesses its depreciable assets for changes in useful life or impairment on a quarterly basis. Where an impairment indicator exists and the depreciable asset does not generate separate cash flows on a stand-alone basis, impairment is assessed based on the recoverable amount of the CGU to which the depreciable asset belongs. If the CGU is not impaired, the useful life of the depreciable asset is assessed with any changes applied on a prospective basis. Any impairment loss is recognized on the Consolidated Statement of Income in the period in which the impairment is identified. Impairment losses previously recognized are assessed and reversed if the circumstances leading to their impairment are no longer present. Reversal of any impairment loss will not exceed the carrying amount of the depreciable asset that would have been determined had no impairment loss been recognized for the asset in prior periods.
Non-Current Assets Held-For-Sale	NON-CURRENT ASSETS HELD-FOR-SALE Individual non-current assets or disposal groups are classified as held-for-sale if they are available for immediate sale in their present condition subject only to terms that are usual and customary for sales of such assets or disposal groups, and their sale must be highly probable to occur within one year. For a sale to be highly probable, management must be committed to a sales plan and initiate an active program to market the sale of the non-current assets or disposal groups. Non-current assets or disposal groups classified as held-for-sale are measured at the lower of their carrying amount and fair value less costs to sell on the Consolidated Balance Sheet. Write-downs on premises related non-current assets and write-downs on equipment on initial classification as held-for-sale are included in Non-interest expenses on the Consolidated Statement of Income. Subsequently, a non-current asset or disposal group that is held-for-sale is no longer depreciated or amortized, and any subsequent write-downs in fair value less costs to sell or such increases not in excess of cumulative write-downs, are recognized in Other income on the Consolidated Statement of Income.
Share-Based Compensation	SHARE-BASED COMPENSATION The Bank grants share options to certain key employees as compensation for services provided to the Bank. The Bank uses a binomial tree-based valuation option pricing model to estimate fair value for all share option compensation awards. The cost of the share options is based on the fair value estimated at the grant date and is recognized as compensation expense and contributed surplus over the service period required for employees to become fully entitled to the awards. This period is generally equal to the vesting period in addition to a period prior to the grant date. For the Bank’s share options, this period is generally equal to five years. When options are exercised, the amount initially recognized in the contributed surplus balance is reduced, with a corresponding increase in common shares. The Bank has various other share-based compensation plans where certain employees of the Bank are awarded share units equivalent to the Bank’s common shares as compensation for services provided to the Bank. The obligation related to share units is included in other liabilities on the Consolidated Balance Sheet. Compensation expense is recognized based on the fair value of the share units at the grant date adjusted for changes in fair value between the grant date and the vesting date, net of hedging activities, over the service period required for employees to become fully entitled to the awards. This period is generally equal to the vesting period, in addition to a period prior to the grant date. For the Bank’s share units, this period is generally equal to four years.
Employee Benefits	EMPLOYEE BENEFITS Defined Benefit Plans Actuarial valuations are prepared at least every three years to determine the present value of the projected benefit obligation related to the Bank’s defined benefit plans. In periods between actuarial valuations, an extrapolation is performed based on the most recent valuation completed. All remeasurement gains and losses are recognized immediately in other comprehensive income, with cumulative gains and losses reclassified to retained earnings. Pension and post-retirement defined benefit plan expenses are determined based upon separate actuarial valuations using the projected benefit method pro-rated on service and management’s best estimates of discount rate, compensation increases, health care cost trend rate, and mortality rates, which are reviewed annually with the Bank’s actuaries. The discount rate used to value liabilities is determined by reference to market yields on high-quality corporate bonds with terms matching the plans’ specific cash flows . The expense recognized includes the cost of benefits for employee service provided in the current year, net interest expense or income on the net defined benefit liability or asset, past service costs related to plan amendments, curtailments or settlements, and administrative costs. Plan amendment costs are recognized in the period of a plan amendment, irrespective of its vested status. Curtailments and settlements are recognized by the Bank when the curtailment or settlement occurs. A curtailment occurs when there is a significant reduction in the number of employees covered by the plan. A settlement occurs when the Bank enters into a transaction that eliminates all further legal or constructive obligation for part or all of the benefits provided under a defined benefit plan. The fair value of plan assets and the present value of the projected benefit obligation are measured as at October 31. The net defined benefit asset or liability represents the difference between the cumulative remeasurement gains and losses, expenses, and recognized contributions and is reported in other assets or other liabilities. Net defined benefit assets recognized by the Bank are subject to a ceiling which limits the asset recognized on the Consolidated Balance Sheet to the amount that is recoverable through refunds of contributions or future contribution holidays. In addition, where a regulatory funding deficit exists related to a defined benefit plan, the Bank is required to record a liability equal to the present value of all future cash payments required to eliminate that deficit. Defined Contribution Plans For defined contribution plans, annual pension expense is equal to the Bank’s contributions to those plans.
Insurance	INSURANCE Insurance contracts are aggregated into groups which are measured at the risk-adjusted present value of cash flows in fulfilling the contracts. Insurance revenue is recognized on the Consolidated Statement of Income as insurance services are provided over the coverage period of the contracts within the groups. Insurance service expenses are reported on the Consolidated Statement of Income as insurance claims and related expenses are recognized and when contract groups are expected to be onerous. Contract groups are onerous if their fulfilment cash flows are expected to result in a net outflow. The liabilities from insurance groups are comprised of the liability for remaining coverage (LRC) and the liability for incurred claims (LIC) and are reported as Insurance contract liabilities on the Consolidated Balance Sheet. The LRC is the obligation to investigate and pay claims that have not yet occurred and includes a loss component related to onerous contract groups. The LIC is the estimate of claims incurred, including claims that have occurred but have not been reported, and related insurance costs. The Bank measures its insurance contract groups using one of two measurement models, the premium allocation approach (PAA) or the general measurement model (GMM). The majority of insurance contract groups are measured using the PAA, which includes the Bank’s property and casualty insurance contracts and short-term life and health insurance contracts. The PAA is a simplified model applied to insurance contracts that are either one year or less or where the PAA approximates the GMM. Contracts using the GMM are longer-term life and health contracts. The LRC for insurance contract groups using the PAA is measured as the premiums received less insurance acquisition cash flows paid. The LRC is adjusted for the recognition of insurance revenue and amortization of acquisition cash flows reported in insurance service expenses on a straight-line basis over the contractual terms of the underlying insurance contracts, usually twelve months. The LRC for longer term contracts using the GMM model is measured using estimates and assumptions that reflect the timing and uncertainty of insurance cash flows. Under both the PAA and GMM, when a group of contracts is expected to be onerous, a loss component (expected loss related to fulfilling the group’s insurance contracts) is established which increases the LRC and insurance service expenses. The loss component of the LRC is subsequently recognized as a reduction to insurance service expenses over the contractual term of the underlying insurance contracts to offset claims incurred and related expenses. The Bank measures the LIC at the present value of current estimates of claims and related costs for insurable events occurring at or before the Consolidated Balance Sheet date. The LIC includes a risk adjustment, which represents the compensation the Bank requires for bearing the uncertainty related to non-financial risks in its fulfilment of insurance contracts. Expenses related to claims incurred, including claims arising from catastrophes, and related costs are reported in insurance service expenses while changes related to discounting the liability are recorded as insurance finance income or expenses in other income (loss). Estimates used in the measurement of insurance contract liabilities are determined in accordance with accepted actuarial practices. Current estimates of claims and related expenses are determined on a case-by-case basis and consider such variables as past loss experience, current claims trends and changes in the prevailing social, economic, and legal environment. These estimates are continually reviewed, and as experience develops and new information becomes known, the estimates are adjusted as necessary. In addition to reported claims information, the Bank’s insurance contract liabilities include a provision to account for the future development of insurance claims, including insurance claims incurred but not reported by policyholders (IBNR). IBNR liabilities are evaluated based on historical development trends and actuarial methodologies for groups of claims with similar attributes. Reinsurance contracts held are recognized and measured using the same principles as insurance contracts. Reinsurance contract assets are presented in Other assets on the Consolidated Balance Sheet and the net results from reinsurance contracts held are presented in Other income (loss) on the Consolidated Statement of Income. Refer to Note 20 for further detail on the balances and results of insurance and reinsurance contracts.
Provisions & Contingent Liabilities	PROVISIONS & CONTINGENT LIABILITIES Provisions are recognized when the Bank has a present obligation (legal or constructive) as a result of a past event, the amount of which can be reliably estimated, and it is probable that an outflow of resources will be required to settle the obligation. Provisions are measured based on management’s best estimate of the consideration required to settle the obligation at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation. If the effect of the time value of money is material, provisions are measured at the present value of the expenditure expected to be required to settle the obligation, using a discount rate that reflects the current market assessment of the time value of money and the risks specific to the obligation. Contingent liabilities exist when there is a possible obligation which is yet to be confirmed or a present obligation which has been confirmed but the outflow of future resources is not probable or is not reliably measurable. Contingent liabilities are not recorded in the Bank’s Consolidated Financial Statements and are disclosed if material unless there is a remote chance that it will result in a future outflow of resources to settle.
Income Taxes	INCOME TAXES Income tax is comprised of current and deferred tax. Income tax is recognized in the Provision for (recovery of) income taxes on the Consolidated Statement of Income, except to the extent that it relates to items recognized in other comprehensive income or directly in equity, in which case the related taxes are also recognized in other comprehensive income or directly in equity, respectively. Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities on the Consolidated Balance Sheet and the amounts attributed to such assets and liabilities for tax purposes. Deferred tax assets and liabilities are determined based on the tax rates that are expected to apply when the assets or liabilities are reported for tax purposes. Deferred tax assets are recognized only when it is probable that sufficient taxable profit will be available in future periods against which deductible temporary differences may be utilized. Deferred tax liabilities are not recognized on temporary differences arising on investments in subsidiaries, branches, and associates, and interests in joint ventures if the Bank controls the timing of the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future. The Bank records a provision for uncertain tax positions if it is probable that the Bank will have to make a payment to tax authorities upon their examination of a tax position. This provision is measured at the Bank’s best estimate of the amount expected to be paid. Provisions are reversed in provision for (recovery of) income taxes in the period in which management determines they are no longer required or as determined by statute.
Leases	LEASES An arrangement contains a lease if there is an identified asset and the Bank has a right to control that asset for a period of time in exchange for consideration. A right-of-use (ROU) asset and lease liability is recognized for all leases except for short-term leases and low value leases, as described below. At the lease commencement date, the lease liability is initially recognized at the present value of the future lease payments over the remaining lease term and is discounted using the Bank’s incremental borrowing rate. The right-of-use asset is recognized at cost, comprising an amount equal to the lease liability, subject to certain adjustments. Subsequently, the right-of-use asset is measured at cost less accumulated depreciation and impairment and adjusted for any remeasurement of lease liabilities, while the lease liability is accreted using the Bank’s incremental borrowing rate. The lease liability is remeasured when there is a modification, a change in the lease term, a change in the lease payments (e.g., changes to future payments resulting from a change in an index or rate used to determine such lease payments) or changes in the Bank’s assumptions or strategies relating to the exercise of purchase, extension, or termination options. The Bank’s leases consist primarily of real estate, equipment and other asset leases. Right-of-use assets are recorded in Land, buildings, equipment, other depreciable assets and right-of-use assets on the Consolidated Balance Sheet and lease liabilities are included in Other liabilities on the Consolidated Balance Sheet. Interest expense on lease liabilities is included in Net interest income and depreciation expense on the right-of-use assets is recognized in Non-interest expenses on the Consolidated Statement of Income. Short-term leases, which have a lease term of twelve months or less, and leases of low-value assets are exempt, and their payments are recognized in Non- interest expenses on a straight-line basis within the Bank’s Consolidated Statement of Income.

Summary of Material Accounting Policies (Policies)

12 Months Ended

Oct. 31, 2025

Summary of Material Accounting Policies [Abstract]

Basis of Consolidation

BASIS OF CONSOLIDATION

The Consolidated Financial Statements include

the assets, liabilities, results of operations,

and cash flows of the Bank and its subsidiaries

including certain

structured entities which it controls.

The Bank’s Consolidated Financial Statements have

been prepared using uniform accounting policies

for like transactions and events in similar

circumstances.

All intercompany transactions, balances,

and unrealized gains and losses on transactions

are eliminated on consolidation.

Subsidiaries

Subsidiaries are corporations or other legal

entities controlled by the Bank, generally

through directly holding more than half of

the voting power of the entity.

Control of subsidiaries is determined based

on the power exercisable through ownership

of voting rights and is generally aligned with

the risks and/or returns

(collectively referred to as “variable returns”)

absorbed from subsidiaries through those

voting rights. As a result, the Bank controls

and consolidates subsidiaries

when it holds the majority of the voting rights

of the subsidiary, unless there is evidence that another investor

has control over the subsidiary. The existence and

effect of potential voting rights that are currently

exercisable or convertible are considered

in assessing whether the Bank controls

an entity. Subsidiaries are

consolidated from the date the Bank obtains

control and continue to be consolidated until

the date when control ceases to exist.

The Bank may consolidate certain subsidiaries

where it owns 50% or less of the voting rights.

Most of those subsidiaries are structured entities

as described in the

following section.

Structured Entities

Structured entities are entities created

to accomplish a narrow and well-defined objective.

Structured entities may take the form

of a corporation, trust, partnership,

or unincorporated entity. They are often created with legal arrangements

that impose limits on the decision-making powers

of their governing board, trustee, or

management. Structured entities are consolidated

when the substance of the relationship

between the Bank and the structured entity

indicates that the Bank

controls the entity. When assessing whether the Bank has to consolidate

a structured entity, the Bank evaluates three primary criteria in order

to conclude

whether, in substance:

●

The Bank has the power to direct the activities

of the structured entity that have the

most significant impact on the entity’s variable returns;

●

The Bank is exposed to significant variable

returns arising from the entity; and

●

The Bank has the ability to use its power

to affect the variable returns to which it is exposed.

Consolidation conclusions are reassessed at

the end of each financial reporting period.

The Bank’s policy is to consider the impact on consolidation

of all

significant changes in circumstances,

focusing on the following:

●

Substantive changes in ownership, such as

the purchase or disposal of more than

an insignificant interest in an entity;

●

Changes in contractual or governance arrangements

of an entity;

●

Additional activities undertaken, such as providing

a liquidity facility beyond the original terms

or entering into a transaction not originally

contemplated;

●

Changes in the financing structure of an entity;

and

●

Changes in the rights to exercise power over

an entity.

Investments in Associates and Joint Ventures

INVESTMENTS IN ASSOCIATES AND JOINT VENTURES

Entities over which the Bank has significant

influence are associates and entities over

which the Bank has joint control are joint

ventures. Significant influence is

the power to participate in the financial and

operating policy decisions of an investee,

but is not control or joint control over these

entities. Significant influence is

presumed to exist where the Bank holds between

% and

% of the voting rights of an entity. Significant influence may

also exist where the Bank holds less

than

% of the voting rights and has influence over

financial and operating policy-making processes,

through board representation and significant

commercial

arrangements. Associates and joint ventures

are accounted for using the equity method

of accounting. Investments in associates and

joint ventures are carried on

the Consolidated Balance Sheet initially at

cost and increased or decreased to recognize

the Bank’s share of the profit or loss of the associate

or joint venture,

capital transactions, including the receipt of any

dividends, and write-downs to reflect

any impairment in the value of such entities.

These increases or decreases,

together with any gains and losses realized

on disposition, are reported on the

Consolidated Statement of Income. The

carrying amount of the investments also

includes the Bank’s share of the investee’s other comprehensive

income or loss, which is reported in

the relevant section of the Consolidated

Statement of

Comprehensive Income.

At each balance sheet date, the Bank assesses

whether there is any objective evidence

that the investment in an associate or joint

venture is impaired. The

Bank calculates the amount of impairment

as the difference between the higher of fair

value or value-in-use and its carrying value.

Cash and Due From Banks

CASH AND DUE FROM BANKS

Cash and due from banks consist of cash and

amounts due from banks which are issued

by investment grade financial institutions.

These amounts are due on

demand or have an original maturity of three

months or less.

Revenue Recognition

REVENUE RECOGNITION

Revenue is recognized at an amount that reflects

the consideration the Bank expects to be

entitled to in exchange for transferring

services to a customer,

excluding amounts collected on behalf of

third parties. The Bank recognizes revenue

when it transfers control of a good or a service

to a customer at a point in

time or over time. The determination

of when performance obligations are satisfied

requires the use of judgment. Refer

to Note 3 for further details.

The Bank identifies contracts with customers

subject to IFRS 15,

Revenue from Contracts with Customers

, which create enforceable rights and obligations.

The

Bank determines the performance obligations

based on distinct services promised to

the customers in the contracts. The Bank’s

contracts generally have a term of

one year or less, consist of a single performance

obligation, and the performance obligations

generally reflect services.

For each contract, the Bank determines the

transaction price, which includes estimating

variable consideration and assessing whether

the price is constrained.

Variable consideration is included in the transaction

price to the extent that it is highly probable

that a significant reversal of the amount will not

occur when the

uncertainty associated with the amount of

variable consideration is subsequently resolved.

As such, the estimate of the variable consideration

is constrained until

the end of the invoicing period. The

uncertainty is generally resolved at the end

of the reporting period and as such, no significant

judgment is required when

recognizing variable consideration in revenues.

The Bank’s receipt of payment from customers

generally occurs subsequent to the

satisfaction of performance obligations or a

short time thereafter. As such,

the Bank has not recognized any material

contract assets (unbilled receivables) or

contract liabilities (deferred revenues)

and there is no significant financing

component associated with the consideration

due to the Bank.

When another party is involved in the transfer

of services to a customer, an assessment is made to evaluate

whether the Bank is the principal such that

revenues are reported on a gross basis or

the agent such that revenues are reported

on a net basis. The Bank is the principal

when it controls the services in the

contract promised to the customer before

they are transferred. Control is demonstrated

by the Bank being primarily responsible

for fulfilling the transfer of the

services to the customer, having discretion in establishing pricing

of the services, or both.

Investment and securities services

Investment and securities services income

includes

asset management fees, administration

and commission fees, and investment banking

fees. The Bank

recognizes asset management and administration

fees based on time elapsed, which depicts

the rendering of investment management

and related services over

time. The fees are primarily calculated based

on average daily or point in time assets

under management (AUM) or assets under administration

(AUA) depending

on the investment mandate.

Commission fees include sales, trailer and

brokerage commissions. Sales and brokerage

commissions are generally recognized at a point

in time when the

transaction is executed. Trailer commissions are recognized

over time and are generally calculated based

on the average daily net asset value of

the fund during

the period.

Investment banking fees include advisory

fees and underwriting fees and are generally

recognized at a point in time upon successful

completion of the

engagement.

Credit fees

Credit fees include liquidity fees, restructuring

fees, letter of credit fees, and loan syndication

fees. Liquidity, restructuring,

and letter of credit fees are recognized

income over the period in which the service

is provided. Loan syndication fees are

generally recognized at a point in time

upon completion of the financing

placement.

Service charges

Service charges income is earned on personal

and commercial deposit accounts and

consists of account fees and transaction-based

service charges. Account

fees relate to account maintenance activities

and are recognized in income over the

period in which the service is provided. Transaction-based

service charges are

recognized as earned at a point in time

when the transaction is complete.

Card services

Card services income includes interchange

income as well as card fees such as annual

and transactional fees. Interchange income

is recognized at a point in time

when the transaction is authorized and funded.

Card fees are recognized as earned at the

transaction date with the exception of annual

fees, which are recognized

over a twelve-month period.

Financial Instruments

FINANCIAL INSTRUMENTS

Classification and Measurement of Financial

Assets

The Bank classifies its financial assets into

the following categories:

●

Amortized cost;

●

Fair value through other comprehensive income

(FVOCI);

●

Held-for-trading;

●

Non-trading fair value through profit or loss

(FVTPL); and

●

Designated as measured at FVTPL.

The Bank recognizes financial assets on a

settlement date basis, except for derivatives

and securities, which are recognized on a

trade date basis.

Debt Instruments

The classification and measurement for debt

instruments is based on the Bank’s business

models for managing its financial assets

and whether the contractual

cash flows represent solely payments of principal

and interest (SPPI). Refer to Note 3 for judgment

with respect to the determination of the Bank’s

business

models and whether contractual cash flows represent

SPPI.

The Bank has determined its business

models as follows:

●

Held-to-collect: the objective is to collect

contractual cash flows;

●

Held-to-collect-and-sell: the objective is both

to collect contractual cash flows and

sell the financial assets; and

●

Held-for-sale and other business models: the

objective is neither of the above.

The Bank performs the SPPI test for

financial assets held within the held-to-collect

and held-to-collect-and-sell business models.

If these financial assets have

contractual cash flows which are inconsistent

with a basic lending arrangement that do

not pass the SPPI test,

they are classified as non-trading financial

assets

measured at FVTPL. In a basic lending arrangement,

interest includes consideration for time

value of money, credit risk, other basic lending risks, and a

reasonable profit margin.

Debt Securities and Loans Measured at Amortized

Cost

Debt securities and loans held within a held-to-collect

business model where their contractual

cash flows pass the SPPI test are measured

at amortized cost. The

carrying amount of these financial assets is

adjusted by an allowance for credit losses

recognized and measured as described in

the Impairment – Expected Credit

Loss Model

section of this Note, as well as any write-offs and unearned

income which includes prepaid interest,

loan origination fees and costs, commitment

fees,

loan syndication fees, and unamortized discounts

or premiums. Interest income is recognized

using EIRM. The effective interest rate (EIR) is

the rate that

discounts expected future cash flows for

the expected life of the financial instrument

to its carrying value. The calculation takes

into account the contractual interest

rate, along with any fees or incremental

costs that are directly attributable to the instrument

and all other premiums or discounts. Loan

origination fees and costs

are considered to be adjustments to the loan

yield and are recognized in interest income

over the term of the loan. Commitment fees are

recognized in credit fees

over the commitment period when it is

unlikely that the commitment will be

called upon; otherwise, they are recognized

in interest income over the term of the

resulting loan. Loan syndication fees are recognized

in credit fees upon completion of the

financing placement unless the yield on any loan

retained by the Bank is

less than that of other comparable lenders involved

in the financing syndicate. In such cases,

an appropriate portion of the fee is recognized

as a yield adjustment

in interest income over the term of the loan.

Debt Securities and Loans Measured at Fair

Value through Other Comprehensive Income

Debt securities and loans held within a held-to-collect-and-sell

business model where their contractual cash

flows pass the SPPI test are measured at

FVOCI. Fair

value changes are recognized in other

comprehensive income, except for impairment

gains or losses, interest income and

foreign exchange gains and losses on

the instrument’s amortized cost, which are recognized

in the Consolidated Statement of Income.

Interest income is recognized using EIRM.

The expected credit

loss (ECL) allowance is recognized and

measured as described in the Impairment

– Expected Credit Loss Model section of

this Note. When the financial asset is

derecognized, the cumulative gain or loss previously

recognized in other comprehensive income is

reclassified from equity to income and

recognized in other

income (loss).

Financial Assets Held-for-Trading

The held-for-sale business model includes

financial assets held within a trading portfolio,

which have been originated, acquired,

or incurred principally for the

purpose of selling in the near term, or if they

form part of a portfolio of identified financial

instruments that are managed together

and for which there is evidence of

short-term profit-taking. Financial assets

held within this business model consist of

trading securities, trading loans, as well

as certain securities purchased under

reverse repurchase agreements.

Trading portfolio assets are accounted for at fair value

with changes in fair value recognized in

trading income (loss). Transaction costs are expensed as

incurred. Dividends are recognized on

the ex-dividend date and interest is recognized

on an accrual basis. Both dividends and interest

are included in interest

income.

Non-Trading Financial Assets Measured at Fair Value through Profit or Loss

Non-trading financial assets measured at

FVTPL include financial assets held

within the held-for-sale and other business

models, for example debt securities and

loans managed on a fair value basis. Financial

assets held within the held-to-collect or held-to-collect-and-sell

business models that do not pass the SPPI

test are

also classified as non-trading financial assets

measured at FVTPL. Changes in fair value

as well as any gains or losses realized on

disposal are recognized in

other income (loss). Interest income from

debt instruments is included in interest

income on an accrual basis.

Financial Assets Designated at Fair Value through Profit

or Loss

Debt instruments in a held-to-collect

or held-to-collect-and-sell business model can be

designated at initial recognition as measured

at FVTPL, provided the

designation can eliminate or significantly reduce

an accounting mismatch that would

otherwise arise from measuring these

financial assets on a different basis.

The FVTPL designation is available only

for those financial instruments for which a

reliable estimate of fair value can be obtained.

Once financial assets are

designated at FVTPL,

the designation is irrevocable. Changes in

fair value as well as any gains or losses realized

on disposal are recognized in other income

(loss). Interest income from these financial

assets is included in interest income on an accrual

basis.

Equity Instruments

Equity investments are required to be measured

at FVTPL, except where the Bank has

elected at initial recognition to irrevocably designate

an equity investment,

held for purposes other than trading, at FVOCI.

If such an election is made, the fair value

changes, including any associated foreign exchange

gains or losses, are

recognized in other comprehensive income

and are not subsequently reclassified

to net income, including upon disposal.

Realized gains and losses are

transferred directly to retained earnings

upon disposal. Consequently, there is no review required for impairment.

Dividends will normally be recognized in interest

income unless the dividends represent a recovery

of part of the cost of the investment. Gains and

losses on trading and non-trading equity investments

measured

at FVTPL are included in trading income (loss)

and other income (loss), respectively.

Classification and Measurement for

Financial Liabilities

The Bank classifies its financial liabilities into

the following categories:

●

Held-for-trading;

●

Designated at FVTPL; and

●

Other liabilities.

Financial Liabilities Held-for-Trading

Financial liabilities are held within a trading

portfolio if they have been incurred principally

for the purpose of repurchasing in the near

term, or form part of a

portfolio of identified financial instruments

that are managed together and for which

there is evidence of a recent actual pattern

of short-term profit-taking. Financial

liabilities held-for-trading are primarily trading

deposits, securitization liabilities at

fair value, obligations related to securities

sold short and certain obligations

related to securities sold under repurchase agreements.

Trading portfolio liabilities are accounted for at fair

value, with changes in fair value as well as any

gains or losses realized on disposal recognized

in trading

income (loss). Transaction costs are expensed as incurred.

Interest is recognized on an accrual basis

in interest expense.

Financial Liabilities Designated at Fair Value through

Profit or Loss

Certain financial liabilities may be designated

at FVTPL at initial recognition. To be designated at FVTPL, financial liabilities

must meet one of the following criteria:

(1) the designation eliminates or significantly

reduces a measurement or recognition

inconsistency; (2) the financial liabilities

or a group of financial assets and

financial liabilities are managed, and their performance

is evaluated, on a fair value basis in accordance

with a documented risk management or

investment

strategy; or (3) the instrument contains one

or more embedded derivatives unless

a) the embedded derivative does not significantly

modify the cash flows that

otherwise would be required by the contract,

or b) it is clear with little or no analysis

that separation of the embedded derivative

from the financial instrument is

prohibited. In addition, the FVTPL designation

is available only for those financial instruments

for which a reliable estimate of fair value can be

obtained. Once

financial liabilities are designated at FVTPL,

the designation is irrevocable.

Financial liabilities designated at FVTPL are

carried at fair value on the Consolidated Balance

Sheet, with changes in fair value as well as

any gains or losses

realized on disposal recognized in other income

(loss), except for the amount of change in

fair value attributable to changes in the Bank’s own

credit risk, which is

presented in other comprehensive income.

Amounts recognized in other comprehensive

income are not subsequently reclassified

to net income upon

derecognition of the financial liability;

instead,

they are transferred directly to retained

earnings.

Changes in fair value attributable to changes in

the Bank’s own credit risk are measured as

the difference between: (i) the period-over-period

change in the

present value of the expected cash flows

using an all-in discount curve reflecting both

the interest rate benchmark curve and

the Bank’s own credit curve; and (ii)

the period-over-period change in the present

value of the same expected cash flows using

a discount curve based solely on the interest

rate benchmark curve.

For loan commitments and financial guarantee

contracts that are designated at FVTPL,

the full change in fair value of the liability is recognized

in other income

(loss).

Interest is recognized on an accrual basis

in interest expense.

Other Financial Liabilities

Deposits

Deposits, other than deposits included in a

trading portfolio and deposits designated at

FVTPL, are accounted for at amortized cost.

Accrued interest on deposits

is included in Other liabilities on the Consolidated

Balance Sheet. Interest, including capitalized

transaction costs, is recognized on an accrual

basis using EIRM as

Interest expense on the Consolidated Statement

of Income.

Subordinated Notes and Debentures

Subordinated notes and debentures are

accounted for at amortized cost. Accrued

interest on subordinated notes and debentures

is included in Other liabilities on

the Consolidated Balance Sheet. Interest, including

capitalized transaction costs, is recognized

on an accrual basis using EIRM as Interest

expense on the

Consolidated Statement of Income.

Reclassification of Financial Assets and

Financial Liabilities

Financial assets and financial liabilities are

not reclassified subsequent to their initial

recognition, except for financial assets

for which the Bank changes its

business model for managing financial assets.

Such reclassifications of financial assets

are expected to be rare in practice.

Impairment – Expected Credit Loss Model

The ECL model applies to financial assets, including

loans and debt securities measured

at amortized cost, loans and debt securities

measured at FVOCI, loan

commitments, and financial guarantees

that are not measured at FVTPL.

The ECL model consists of three stages:

Stage 1 – Twelve-month ECLs for performing

financial assets, Stage 2 – Lifetime ECLs

for financial assets that have

experienced a significant increase in credit

risk since initial recognition, and Stage 3 – Lifetime

ECLs for financial assets that are credit-impaired.

ECLs are the

difference between all the contractual cash flows

that are due to the Bank in accordance

with the contract and all the cash flows the

Bank expects to receive,

discounted at the original EIR. If a significant

increase in credit risk has occurred

since initial recognition, impairment is

measured as lifetime ECLs. Otherwise,

impairment is measured as twelve-month ECLs

which represent the portion of lifetime ECLs

that are expected to occur based on default

events that are possible

within twelve months after the reporting date.

If credit quality improves in a subsequent

period such that the increase in credit risk

since initial recognition is no

longer considered significant, the loss allowance

reverts to being measured based on twelve-month

ECLs.

Significant Increase in Credit Risk

For retail exposures, significant increase in

credit risk is assessed based on changes in

the twelve-month probability of default (PD)

since initial recognition, using

a combination of individual and collective information

that incorporates borrower and account

specific attributes and relevant

forward-looking macroeconomic

variables.

For non-retail exposures, significant increase

in credit risk is assessed based on

changes in the internal risk rating (borrower risk

ratings (BRR)) since initial

recognition. Refer to the shaded areas of

the “Managing Risk” section of the 2025

MD&A for further details on the Bank’s 21-point BRR

scale to risk levels.

For both retail and non-retail exposures,

delinquency backstop when contractual payments

are more than 30 days past due is also used

in assessing significant

increase in credit risk.

The Bank defines default as delinquency of 90

days or more for most retail products

and BRR of

for non-retail exposures. Exposures are considered

credit-

impaired and migrate to Stage 3 when the definition

of default is met or when there is objective

evidence that there has been a deterioration

of credit quality to the

extent the Bank no longer has reasonable

assurance as to the timely collection of

the full amount of principal and interest.

When assessing whether there has been a

significant increase in credit risk since

the initial recognition of a financial asset, the Bank

considers all reasonable

and supportable information that is available

without undue cost or effort about past events,

current conditions, and forecast of future economic

conditions. Refer to

Note 3 for additional details.

Measurement of Expected Credit Losses

ECLs are measured as the probability-weighted

present value of expected cash shortfalls over

the remaining expected life of the financial instrument

and consider

reasonable and supportable information about

past events, current conditions, and forecasts

of future events and economic conditions

that impact the Bank’s

credit risk assessment. Expected life is

the maximum contractual period the Bank is

exposed to credit risk, including extension

options for which the borrower has

the unilateral right to exercise. For certain

financial instruments that include both a loan

and an undrawn commitment,

and the Bank’s contractual ability to demand

repayment and cancel the undrawn commitment

does not limit the Bank’s exposure to credit losses

to the contractual notice period, ECLs are

measured over the

period the Bank is exposed to credit risk.

For example, ECLs for credit cards are

measured over the borrowers’ expected

behavioural life, incorporating

survivorship assumptions and borrower-specific

attributes.

The Bank leverages

its Advanced Internal Ratings-Based

models used for regulatory capital purposes

and incorporates adjustments where appropriate

calculate ECLs.

Forward-Looking Information and Expert

Credit Judgment

Forward-looking information is considered

when determining significant increase in

credit risk and measuring ECLs. Forward-looking

macroeconomic factors are

incorporated in the risk parameters as relevant.

Qualitative factors that are not already considered

in the quantitative models are incorporated

by applying expert credit judgment in determining

the final ECLs.

Refer to Note 3 for additional details.

Modified Loans

In cases where a borrower experiences financial

difficulties, the Bank may grant certain

modifications to the terms and conditions of

a loan. Modifications may

include payment deferrals, extension of amortization

periods, rate reductions, principal forgiveness,

debt consolidation, forbearance and other

modifications

intended to minimize the economic loss and

to avoid foreclosure or repossession

of collateral. The Bank has policies in place

to determine the appropriate

remediation strategy based on the individual

borrower.

If the Bank determines that a modification

results in expiry of cash flows, the original

asset is derecognized and a new asset

is recognized based on the new

contractual terms. Significant increase in

credit risk is assessed relative to the risk of

default on the date of modification.

If the Bank determines that a modification

does not result in derecognition, significant

increase in credit risk is assessed based

on the risk of default at initial

recognition of the original asset. Expected cash

flows arising from the modified contractual

terms are considered when calculating ECLs

for the modified asset. For

loans that were modified while having lifetime

ECLs, the loans can revert to having

twelve-month ECLs after a period of performance

and improvement in the

borrower’s financial condition.

Allowance for Loan Losses

The allowance for loan losses represents

management’s calculation of probability-weighted

ECLs in the lending portfolios, including

any off-balance sheet

exposures, at the balance sheet date. The

allowance for loan losses for lending portfolios

reported on the Consolidated Balance Sheet,

which includes credit-

related allowances for residential mortgages,

consumer instalment and other personal,

credit card, business and government loans, is deducted

from Loans on the

Consolidated Balance Sheet. The allowance

for loan losses for loans measured at

FVOCI is included in the Consolidated Statement

of Changes in Equity. The

allowance for loan losses for off-balance sheet instruments,

which relates to certain guarantees, letters of

credit, and undrawn lines of credit, is recognized

in Other

liabilities on the Consolidated Balance Sheet.

Allowances for lending portfolios reported

on the balance sheet and off-balance sheet exposures

are calculated

using the same methodology. The allowance is increased by the

provision for credit losses and decreased

by write-offs net of recoveries and disposals. Each

quarter, allowances are reassessed and adjusted based on

any changes in management’s estimate of

ECLs. Loan losses on impaired loans in

Stage 3 continue to

be recognized by means of an allowance

for loan losses until a loan is written off.

A loan is written off against the related allowance

for loan losses when there is no realistic

prospect of recovery. Non-retail loans are generally written off

when

all reasonable collection efforts have been exhausted,

such as when a loan is sold, when all security

has been realized, or when all security has

been resolved

with the receiver or bankruptcy court.

Non-real estate retail loans are generally

written off when contractual payments are

180 days past due, or when a loan is

sold. Real estate secured retail loans are generally

written off when the security is realized. The time period

over which the Bank performs collection

activities on

the contractual amount outstanding of financial

assets that are written off varies from one

jurisdiction to another and generally spans

between less than one year to

five years.

Allowance for Credit Losses on Debt Securities

The allowance for credit losses on debt securities

represents management’s calculation of probability-weighted

ECLs. Debt securities measured at amortized

cost

are presented net of the allowance for credit

losses on the Consolidated Balance Sheet.

The allowance for credit losses on debt securities

measured at FVOCI are

included in the Consolidated Statement of

Changes in Equity. The allowance for credit losses is increased

by the provision for credit losses and

decreased by

write-offs net of recoveries and disposals.

Acquired Performing Loans

Acquired performing loans are initially measured

at fair value, which considers incurred

and expected future credit losses estimated

at the acquisition date and

also reflects adjustments based on the acquired

loan’s interest rate in comparison to current

market rates. On acquisition, twelve-month

ECLs are recognized on

the acquired performing loans, resulting in

the carrying amount being lower than fair

value. Acquired performing loans are subsequently

accounted for at amortized

cost based on their contractual cash flows and

any acquisition related discount or premium,

including credit-related discounts, is

considered to be an adjustment to

the loan yield and is recognized in interest income

using EIRM over the term of the loan, or

the expected life of the loan for acquired

performing loans with

revolving terms.

Share Capital and Other Equity Instruments

SHARE CAPITAL AND OTHER EQUITY INSTRUMENTS

The Bank classifies financial instruments

that it issues as either financial liabilities,

equity instruments, or compound instruments.

Issued instruments that are mandatorily redeemable

or convertible into a variable number of

the Bank’s common shares at the holder’s option

are classified as

liabilities on the Consolidated Balance Sheet.

Dividend or interest payments on these instruments

are recognized in Interest expense on the

Consolidated

Statement of Income.

Issued instruments are classified as

equity when there is no contractual obligation

to transfer cash or other financial assets

to redeem or convert these

instruments. Such instruments, if not

mandatorily redeemable or convertible into a

variable number of the Bank’s common shares at the

holder’s option, are

classified as equity on the Consolidated Balance

Sheet. Incremental costs directly attributable

to the issue of equity instruments are included

in equity as a

deduction from the proceeds, net of tax.

Dividends and distributions on these instruments

are recognized as a reduction in equity.

Compound instruments are comprised of

both liability and equity components in accordance

with the substance of the contractual

arrangement. The liability

component is initially measured at fair value

with any residual amount assigned to the equity

component. Issuance costs are allocated

proportionately to the

liability and equity components.

Common shares, preferred shares, and other

equity instruments issued and held by the Bank

are classified as treasury instruments

in equity, and the cost of

these instruments is recorded as a reduction in

equity. Upon the sale of treasury instruments, the difference between

the sale proceeds and the cost of the

instruments is recorded in or against contributed

surplus.

Guarantees

GUARANTEES

The Bank issues guarantee contracts that require

payments to be made to guaranteed parties

based on: (1) changes in the underlying

economic characteristics

relating to an asset or liability of the guaranteed

party; (2) failure of another party to perform

under an obligating agreement; or (3) failure of

another third party to

pay its indebtedness when due. Guarantees

are initially measured and recorded

at their fair value. The fair value of a

guarantee liability at initial recognition

normally equal to the present value of the guarantee

fees received over the life of the contract.

The Bank’s release from risk is recognized over

the term of the

guarantee using a systematic and rational amortization

method.

If a guarantee meets the definition of a derivative,

it is carried at fair value on the Consolidated

Balance Sheet and reported as a derivative asset

or derivative

liability at fair value. Guarantees that are

considered derivatives are over-the-counter

(OTC) credit derivative contracts designed

to transfer the credit risk in an

underlying financial instrument from one

counterparty to another.

Derivatives

DERIVATIVES

Derivatives are instruments that derive

their value from changes in underlying interest

rates, foreign exchange rates, credit spreads,

commodity prices, equities, or

other financial or non-financial measures.

Such instruments include interest rate, foreign

exchange, equity, commodity, and credit derivative contracts. The Bank

uses these instruments for trading and non-trading

purposes. Derivatives are carried at

their fair value on the Consolidated Balance

Sheet.

Derivatives Held for Trading Purposes

The Bank enters into trading derivative contracts

to meet the needs of its customers,

to provide liquidity and market-making

related activities, and in certain cases,

to manage risks related to its trading portfolios.

The realized and unrealized gains or losses

on trading derivatives are recognized

in trading income (loss).

Derivatives Held for Non-trading Purposes

Non-trading derivatives are primarily

used to manage interest rate, foreign exchange,

and other market risks of the Bank’s traditional banking

activities. When

derivatives are held for non-trading purposes

and when the transactions meet the hedge accounting

requirements of IAS 39,

Financial Instruments: Recognition

and Measurement

(IAS 39),

they are presented as non-trading derivatives

and receive hedge accounting treatment, as

appropriate. Certain derivative instruments

that are held for economic hedging purposes,

and do not meet the hedge accounting requirements

of IAS 39, are also presented as non-trading

derivatives with

the change in fair value of these derivatives recognized

in Non-interest income.

Hedging Relationships

Hedge Accounting

The Bank has an accounting policy choice

to apply the hedge accounting requirements

of IFRS 9,

Financial Instruments

(IFRS 9), or IAS 39. The Bank has

made

the decision to continue applying the IAS

39 hedge accounting requirements and complies

with the revised annual hedge accounting disclosures

as required by

the related amendments to IFRS 7,

Financial Instruments: Disclosures

(IFRS 7).

At the inception of a hedging relationship, there

is formal documentation of the relationship

between the hedging instrument and

the hedged item, its risk

management objective, and strategy for undertaking

the hedge. The Bank also requires a documented

assessment, both at hedge inception and

on an ongoing

basis, of whether or not the derivatives that

are used in hedging relationships are

highly effective in offsetting the changes attributable to

the hedged risks in the

fair values or cash flows of the hedged items.

In order to be considered highly effective, the

hedging instrument and the hedged item

must be highly and inversely

correlated such that the changes in the fair

value of the hedging instrument will substantially

offset the effects of the hedged exposure throughout

the term of the

hedging relationship. If a hedging relationship

becomes ineffective, it no longer qualifies

for hedge accounting and any subsequent change

in the fair value of the

hedging instrument is recognized in Non-interest

income on the Consolidated Statement

of Income.

Changes in fair value relating to the derivative

component excluded from the assessment

of hedge effectiveness are recognized in Net interest

income or Non-

interest income, as applicable, on the

Consolidated Statement of Income.

When derivatives are designated in hedge accounting

relationships, the Bank classifies them either

as: (1) hedges of the changes in

fair value of recognized

assets, liabilities or firm commitments (fair

value hedges); (2) hedges of the variability

in highly probable future cash flows

attributable to recognized assets,

liabilities or forecast transactions (cash

flow hedges); or (3) hedges of net investments

in foreign operations (net investment hedges).

Fair Value Hedges

The Bank’s fair value hedges principally consist of

interest rate swaps that are used to protect

against changes in the fair value of fixed-rate

financial instruments

due to movements in market interest rates.

The change in the fair value of the derivative

that is designated and qualifies as a fair value

hedge, as well as the change in the

fair value of the hedged item

attributable to the hedged risk, is recognized

in Net interest income to the extent that the hedging

relationship is effective. Any change in fair

value relating to the

ineffective portion of the hedging relationship

is recognized immediately in Non-interest income.

The cumulative adjustment to the carrying

amount of the hedged item (the basis adjustment)

is amortized to Net interest income on the

Consolidated Statement

of Income based on a recalculated EIR over

the remaining expected life of the hedged item,

with amortization beginning no later than

when the hedged item

ceases to be adjusted for changes in its fair

value attributable to the hedged risk. Where

the hedged item has been derecognized,

the basis adjustment is

immediately released to Net interest

income or Non-interest income, as applicable,

on the Consolidated Statement of Income.

Cash Flow Hedges

The Bank is exposed to variability in

future cash flows attributable to interest rate,

foreign exchange rate, and equity price risks.

The amounts and timing of future

cash flows are projected for each hedged

exposure on the basis of their contractual

terms and other relevant factors, including estimates

of prepayments and

defaults.

The effective portion of the change in the fair value

of the derivative that is designated and qualifies

as a cash flow hedge is initially recognized in

other

comprehensive income. The change in fair

value of the derivative relating to the ineffective

portion is recognized immediately

in Non-interest income. Amounts

accumulated other comprehensive income

(AOCI) are reclassified to Net interest

income or Non-interest income, as applicable,

on the Consolidated Statement of

Income in the same period during which

the hedged item affects income.

When a hedging instrument expires or is sold,

or when a hedge no longer meets the

criteria for hedge accounting, any cumulative gain

or loss existing in AOCI

at that time remains in AOCI until the forecast

transaction impacts the Consolidated Statement

of Income. When a forecast transaction is no

longer expected to

occur, the cumulative gain or loss that was reported in AOCI

is immediately reclassified to Net interest

income or Non-interest income, as applicable,

on the

Consolidated Statement of Income.

Net Investment Hedges

Hedges of net investments in foreign operations

are accounted for similar to cash flow hedges.

The change in fair value on the hedging instrument

relating to the

effective portion is recognized in other comprehensive

income. The change in fair value of the

hedging instrument relating to the ineffective portion

is recognized

immediately in Non-interest income. Gains

and losses in AOCI are reclassified as

Non-interest income in the Consolidated

Statement of Income upon the disposal

or partial disposal of the investment in

the foreign operation. The Bank designates derivatives

and non-derivatives (such as foreign currency

deposit liabilities) as

hedging instruments in net investment hedges

of spot or forward exchange risk.

Embedded Derivatives

Derivatives may be embedded in financial liabilities

or other host contracts. Embedded derivatives

are treated as separate derivatives when

their economic

characteristics and risks are not closely

related to those of the host instrument,

a separate instrument with the same terms

as the embedded derivative would

meet

the definition of a derivative, and the combined

contract is not measured at fair value

with changes in fair value recognized in income,

such as held-for-trading or

designated at FVTPL.

These embedded derivatives, which are bifurcated

from the host contract, are recognized as

Derivatives on the Consolidated Balance Sheet

and measured at fair value with subsequent

changes in fair value recognized in

Non-interest income on the Consolidated Statement

of Income.

Translation and Presentation of Foreign Currencies

TRANSLATION AND PRESENTATION OF FOREIGN CURRENCIES

The Bank’s Consolidated Financial Statements

are

presented in Canadian dollars. Items included

in the financial statements of each of

the Bank’s entities are

measured using their functional currency, which is the currency

of the primary economic environment in

which they operate.

Monetary assets and liabilities denominated

in a currency that differs from an entity’s functional

currency are translated into the functional

currency of the entity

at exchange rates prevailing at the balance

sheet date. Non-monetary assets and liabilities

carried at cost are translated at historical

exchange rates. Non-

monetary assets and liabilities carried at

fair value are translated at the exchange

rate in effect at the balance sheet date. Revenue

and expenses are translated

into an entity’s functional currency at average

exchange rates for the period, except

for depreciation and amortization. Depreciation

and amortization are translated

at historical exchange rates. Translation gains and losses

are included in Non-interest income except

for equity investments designated at

FVOCI where

unrealized translation gains and losses are

recorded in other comprehensive income.

Foreign operations are those with a functional

currency other than Canadian dollars. For

the purpose of translation into the Bank’s presentation

currency, all

assets and liabilities are first measured in

the functional currency of the foreign operation

and subsequently, translated at exchange rates prevailing at

the balance

sheet date. Income and expenses are

translated at average exchange rates for

the period. Unrealized translation gains

and losses relating to these foreign

operations, net of gains or losses arising

from net investment hedges and applicable

income taxes, are included in other

comprehensive income. Translation gains

and losses in AOCI are recognized on

the Consolidated Statement of Income upon

the disposal or partial disposal of the foreign

operation. The investment

balance of foreign entities accounted for

by the equity method, including the Bank’s investment

in The Charles Schwab Corporation (“Schwab”)

prior to the sale, is

translated into Canadian dollars using exchange

rates prevailing at the balance sheet date

with exchange gains or losses recognized in

other comprehensive

income.

Offsetting of Financial Instruments

OFFSETTING OF FINANCIAL INSTRUMENTS

Financial assets and liabilities are offset, with

the net amount presented on the Consolidated

Balance Sheet, only if the Bank currently has

a legally enforceable

right to set off the recognized amounts, and intends

either to settle on a net basis or to realize

the asset and settle the liability simultaneously. In all other

situations,

assets and liabilities are presented on

a gross basis.

Determination of Fair Value

DETERMINATION OF FAIR VALUE

The fair value of a financial instrument on

initial recognition is normally the transaction

price, as evidenced by the fair value of the

consideration given or received.

The best evidence of fair value is quoted prices

in active markets. When there is no

active market for the instrument, the

fair value may be based on other

observable current market transactions

involving the same or similar instruments,

without modification or repackaging, or based

on a valuation technique which

maximizes the use of observable market

inputs.

When financial assets and liabilities have offsetting

market risks or credit risks, the Bank applies

a measurement exception, as described

in Note 5 under

Portfolio Exception

. The value determined from application

of the portfolio exception must be allocated

to the individual financial instruments

within the group to

arrive at the fair value of an individual financial

instrument. Balance sheet offsetting presentation

requirements, as described above under

the Offsetting of

Financial Instruments section of this Note, are

then applied, if applicable.

Valuation adjustments reflect the Bank’s assessment of factors that market participants

would use in pricing the asset or liability. The Bank recognizes

various

types of valuation adjustments including, but

not limited to, adjustments for bid-offer spreads,

adjustments for the unobservability of inputs

used in pricing models,

and adjustments for assumptions about risk,

such as the creditworthiness of either counterparty

and market implied unsecured funding

costs and benefits for OTC

derivatives.

If there is a difference between the initial transaction

price and the value based on a valuation

technique, the difference is referred to as inception

profit or loss.

Inception profit or loss is recognized

upon initial recognition of the instrument only

if the fair value is based on observable inputs.

When an instrument is measured

using a valuation technique that utilizes significant

non-observable inputs, it is initially valued at

the transaction price, which is considered

the best estimate of fair

value. Subsequent to initial recognition, any

difference between the transaction price and

the value determined by the valuation technique

at initial recognition is

recognized as non-observable inputs become

observable.

If the fair value of a financial asset measured

at fair value becomes negative, it is recognized

as a financial liability until either its fair

value becomes positive, at

which time it is recognized as a financial asset,

or until it is extinguished.

Derecognition of Financial Instruments

DERECOGNITION OF FINANCIAL INSTRUMENTS

Financial Assets

The Bank derecognizes a financial asset

when the contractual rights to that asset have

expired. Derecognition may also be appropriate

where the contractual right

to receive future cash flows from the

asset have been transferred, or where

the Bank retains the rights to future cash

flows from the asset, but assumes an

obligation to pay those cash flows to a third party

subject to certain criteria.

When the Bank transfers a financial asset,

it is necessary to assess the extent

to which the Bank has retained the risks and rewards

of ownership of the

transferred asset. If substantially all the risks

and rewards of ownership of the financial

asset have been retained, the Bank continues

to recognize the financial

asset and also recognizes a financial liability

for the consideration received. Certain transaction

costs incurred are also capitalized and amortized

using EIRM. If

substantially all the risks and rewards of ownership

of the financial asset have been transferred,

the Bank will derecognize the financial asset

and recognize

separately as assets or liabilities any rights

and obligations created or retained in the

transfer. The Bank determines whether substantially all the risks

and rewards

have been transferred by quantitatively comparing

the variability in cash flows before and

after the transfer. If the variability in cash flows does not

change

significantly as a result of the transfer, the Bank has retained

substantially all of the risks and rewards of ownership.

If the Bank neither transfers nor retains

substantially all the risks and rewards of

ownership of the financial asset, the Bank

derecognizes the financial asset

where it has relinquished control of the financial

asset. The Bank is considered to have

relinquished control of the financial asset

where the transferee has the

practical ability to sell the transferred financial

asset. Where the Bank has retained control

of the financial asset, it continues to recognize

the financial asset to the

extent of its continuing involvement in

the financial asset. Under these circumstances,

the Bank usually retains the rights to future

cash flows relating to the asset

through a residual interest and is exposed

to some degree of risk associated with the

financial asset.

The derecognition criteria are also applied

to the transfer of part of an asset, rather

than the asset as a whole, or to a group of

similar financial assets in their

entirety, when applicable. If transferring a part of an asset, it

must be a specifically identified cash flow, a fully proportionate

share of the asset, or a fully

proportionate share of a specifically identified

cash flow.

Securitization

Securitization is the process by which

financial assets are transformed into

securities. The Bank securitizes financial

assets by transferring those financial assets

to a third party and as part of the securitization,

certain financial assets may be retained and

may consist of an interest-only strip and, in

some cases, a cash

reserve account (collectively referred to as

“retained interests”). If the transfer qualifies

for derecognition, a gain or loss on sale

of the financial assets is recognized

immediately in other income (loss) after considering

the effect of hedge accounting on the assets

sold, if applicable. The amount of the gain

or loss is calculated as

the difference between the carrying amount of the

asset transferred and the sum of any cash

proceeds received, the fair value of any financial

asset received or

financial liability assumed, and any cumulative

gain or loss allocated to the transferred

asset that had been recognized in AOCI.

To determine the value of the

retained interest initially recorded, the previous

carrying value of the transferred asset is allocated

between the amount derecognized from the balance

sheet and

the retained interest recorded, in proportion

to their relative fair values on the date of transfer. Subsequent

to initial recognition, as market prices are generally

not

available for retained interests, fair value

is determined by estimating the present

value of future expected cash flows using management’s

best estimates of key

assumptions that market participants would

use in determining such fair value. Refer

to Note 3 for assumptions used by management

in determining the fair value

of retained interests. Retained interest is classified

as trading securities with subsequent

changes in fair value recorded in trading income

(loss).

Where the Bank retains the servicing rights,

the benefits of servicing are assessed

against market expectations. When the benefits

of servicing are more than

adequate, a servicing asset is recognized.

Similarly, when the benefits of servicing are less than adequate,

a servicing liability is recognized. Servicing

assets and

servicing liabilities are initially recognized

at fair value and subsequently carried

at amortized cost.

Financial Liabilities

The Bank derecognizes a financial liability when

the obligation under the liability is discharged,

cancelled,

or expires. If an existing financial

liability is replaced by

another financial liability from the same lender

on substantially different terms or where

the terms of the existing liability are substantially

modified, the original

liability is derecognized and a new liability is

recognized with the difference in the respective

carrying amounts recognized on the Consolidated

Statement of

Income.

Securities Purchased Under Reverse

Repurchase Agreements, Securities Sold

Under Repurchase Agreements, and Securities

Borrowing and Lending

Securities purchased under reverse repurchase

agreements involve the purchase of

securities by the Bank under agreements

to resell the securities at a future

date. These agreements are treated as collateralized

lending transactions whereby the Bank

takes possession of the purchased securities, but

does not acquire

the risks and rewards of ownership. The Bank

monitors the market value of the purchased

securities relative to the amounts due under the

reverse repurchase

agreements, and when necessary, requires transfer of additional

collateral. In the event of counterparty default,

the agreements provide the Bank with the right

liquidate the collateral held and offset the proceeds

against the amount owing from the counterparty.

Obligations related to securities sold

under repurchase agreements involve the sale

of securities by the Bank to counterparties

under agreements to repurchase

the securities at a future date. These agreements

do not result in the risks and rewards of

ownership being relinquished and are treated

as collateralized borrowing

transactions. The Bank monitors the market

value of the securities sold relative to

the amounts due under the repurchase agreements,

and when necessary,

transfers additional collateral or may require

counterparties to return the collateral pledged.

Certain transactions that do not meet

derecognition criteria are also

included in obligations related to securities

sold under repurchase agreements. Refer to

Note 9 for further details.

Securities purchased under reverse repurchase

agreements and obligations related to

securities sold under repurchase agreements

are initially recorded on the

Consolidated Balance Sheet at the respective

prices at which the securities were originally

acquired or sold, plus accrued interest.

Subsequently, the agreements

are measured at amortized cost on the Consolidated

Balance Sheet, plus accrued interest, except

when they are held-for-trading or are designated

at FVTPL.

Interest earned on reverse repurchase agreements

and interest incurred on repurchase agreements

is determined using EIRM for agreements

measured at

amortized cost and recognized on an accrual

basis for agreements measured at fair value,

and is included in Interest income and Interest

expense, respectively,

on the Consolidated Statement of Income.

Changes in fair value on reverse repurchase

agreements and repurchase agreements

that are held-for-trading or are

designated at FVTPL are included in Trading income

(loss) or in Other income (loss) on the Consolidated

Statement of Income.

In securities lending transactions,

the Bank lends securities to a counterparty

and receives collateral in the form of

cash or securities. If cash collateral is

received, the Bank records the cash along

with an obligation to return the cash as Obligations

related to securities sold under repurchase

agreements on the

Consolidated Balance Sheet. Where securities

are received as collateral, the Bank does

not record the collateral on the Consolidated

Balance Sheet.

In securities borrowing transactions,

the Bank borrows securities from a counterparty

and pledges either cash or securities as

collateral. If cash is pledged as

collateral, the Bank records the transaction

as Securities purchased under reverse repurchase

agreements on the Consolidated Balance

Sheet. If securities are

pledged as collateral,

the securities remain on the Bank’s Consolidated

Balance Sheet.

Where securities are received or pledged as

collateral, securities lending income and

securities borrowing fees are recorded

in Non-interest income and Non-

interest expenses, respectively, on the Consolidated Statement of

Income over the term of the transaction.

Where cash is pledged or received as

collateral,

interest received or incurred is included in

Interest income and Interest expense, respectively, on the Consolidated

Statement of Income.

Physical commodities purchased or sold

with an agreement to sell or repurchase the physical

commodities at a later date at a fixed price,

are also included in

securities purchased under reverse repurchase

agreements and obligations related to securities

sold under repurchase agreements, respectively, if the

derecognition criteria are not met. These

instruments are measured at fair value.

Goodwill

GOODWILL

Goodwill represents the excess purchase

price paid over the net fair value of identifiable

assets and liabilities acquired in a business

combination. Goodwill is

carried at its initial cost less accumulated impairment

losses.

Goodwill is allocated to a cash-generating

unit (CGU) or a group of CGUs that is

expected to benefit from the synergies of

the business combination, regardless

of whether any assets acquired and liabilities

assumed are assigned to the CGU or group

of CGUs. A CGU is the smallest identifiable group

of assets that

generates cash flows largely independent of

the cash inflows from other assets or groups

of assets. Each CGU or group of CGUs,

to which goodwill is allocated,

represents the lowest level within the Bank

at which the goodwill is monitored

for internal management purposes and is

not larger than an operating segment. If

the composition of a CGU or group of CGUs

to which goodwill has been allocated

changes as a result of the sale of a business,

restructuring or other changes, the

goodwill is reallocated to the units affected using a

relative value approach, unless the Bank

can demonstrate that some other method better

reflects the goodwill

associated with the units affected.

Goodwill is assessed for impairment at least

annually and when an event or change

in circumstances indicates that the carrying amount

may be impaired.

When impairment indicators are present,

the recoverable amount of the CGU or group

of CGUs, which is the higher of its

estimated fair value less costs of

disposal and its value-in-use, is determined.

If the carrying amount of the CGU or group

of CGUs is higher than its recoverable amount,

an impairment loss exists.

The impairment loss is recognized on the Consolidated

Statement of Income and cannot be reversed

in future periods.

Intangible Assets

INTANGIBLE ASSETS

Intangible assets represent identifiable non-monetary

assets and are acquired either separately

or through a business combination, or

internally generated

software. The Bank’s intangible assets consist primarily

of credit card related intangibles,

software intangibles,

and other intangibles. Intangible assets are

initially

recognized at cost, or at fair value if acquired

through a business combination, and are

amortized over their estimated useful lives

(

years) proportionate to

their expected economic benefits, except for

software which is amortized over its estimated

useful life (

years) on a straight-line basis. In respect of internally

generated software, development costs are

capitalized only if the costs can be measured

reliably, the asset is technically feasible, future economic benefits

are

probable, and the Bank intends to and has

sufficient resources to complete development

of the asset. Research costs are expensed

as incurred.

The Bank assesses its intangible assets

for impairment indicators on a quarterly basis.

When impairment indicators are present, the recoverable

amount of the

asset, which is the higher of its estimated

fair value less costs of disposal and its value-in-use,

is determined. If the carrying amount

of the asset is higher than its

recoverable amount, the asset is written down

to its recoverable amount. Where it is not possible

to estimate the recoverable amount of an individual

asset, the

Bank estimates the recoverable amount

of the CGU to which the asset belongs.

If the CGU is not impaired, the useful

life of the intangible asset is assessed with

any changes applied on a prospective basis.

An impairment loss is recognized on

the Consolidated Statement of Income in

the period in which the impairment is

identified. Impairment losses recognized

previously are assessed and reversed if

the circumstances leading to the impairment

are no longer present. Reversal of

any impairment loss will not exceed the

carrying amount of the intangible asset

that would have been determined had no

impairment loss been recognized for the

asset in prior periods.

Land, Buildings, Equipments, and Other Depreciable Assets

LAND, BUILDINGS, EQUIPMENT, AND OTHER DEPRECIABLE ASSETS

Land is recognized at cost. Buildings, computer

equipment, furniture and fixtures, other equipment,

and leasehold improvements are recognized

at cost less

accumulated depreciation and provisions

for impairment, if any. Gains or losses on disposal are included in

Non-interest income on the Consolidated

Statement of

Income.

The Bank records the obligation associated

with the retirement of a long-lived asset

at fair value in the period in which it is incurred

and can be reasonably

estimated, and records a corresponding increase

to the carrying amount of the asset. The asset

is depreciated on a straight-line

basis over its remaining useful life

while the liability is accreted to reflect the passage

of time until the eventual settlement of the

obligation.

Depreciation is recognized on a straight-line

basis over the useful lives of the assets

estimated by asset category, as follows:

Asset

Useful Life

Buildings

years

Computer equipment

years

Furniture and fixtures

years

Other equipment

years

Leasehold improvements

Lesser of the remaining lease term and

the remaining useful life of the asset

The Bank assesses its depreciable assets

for changes in useful life or impairment

on a quarterly basis. Where an impairment

indicator exists and the depreciable

asset does not generate separate cash flows

on a stand-alone basis, impairment is assessed

based on the recoverable amount of the

CGU to which the

depreciable asset belongs. If the CGU is not

impaired, the useful life of the depreciable

asset is assessed with any changes applied

on a prospective basis. Any

impairment loss is recognized on the Consolidated

Statement of Income in the period in which

the impairment is identified. Impairment

losses previously

recognized are assessed and reversed if the

circumstances leading to their impairment

are no longer present. Reversal of any impairment

loss will not exceed the

carrying amount of the depreciable asset

that would have been determined had no impairment

loss been recognized for the asset in prior periods.

Non-Current Assets Held-For-Sale

NON-CURRENT ASSETS HELD-FOR-SALE

Individual non-current assets or disposal groups

are classified as held-for-sale if they are

available for immediate sale in their present

condition subject only to

terms that are usual and customary for

sales of such assets or disposal groups, and

their sale must be highly probable to occur

within one year. For a sale to be

highly probable, management must be committed

to a sales plan and initiate an active program

to market the sale of the non-current assets

or disposal groups.

Non-current assets or disposal groups classified

as held-for-sale are measured at the lower

of their carrying amount and fair value

less costs to sell on the

Consolidated Balance Sheet. Write-downs on premises

related non-current assets and write-downs

on equipment on initial classification

as held-for-sale are

included in Non-interest expenses on the Consolidated

Statement of Income. Subsequently, a non-current asset or disposal

group that is held-for-sale is no longer

depreciated or amortized, and any subsequent

write-downs in fair value less costs to sell or

such increases not in excess of cumulative

write-downs, are

recognized in Other income on the Consolidated

Statement of Income.

Share-Based Compensation

SHARE-BASED COMPENSATION

The Bank grants share options to certain

key employees as compensation for services

provided to the Bank. The Bank uses

a binomial tree-based valuation

option pricing model to estimate fair value

for all share option compensation awards.

The cost of the share options is based on the fair value estimated at the grant

date and is recognized as compensation expense and contributed surplus over the service period required for employees to become fully entitled to the awards.

This period is generally equal to the vesting period in addition to a period prior to the grant date. For the Bank’s share options, this period is generally equal to five

years. When options are exercised, the amount initially recognized in the contributed surplus balance is reduced, with a corresponding increase in common

shares.

The Bank has various other share-based

compensation plans where certain employees

of the Bank are awarded share units equivalent

to the Bank’s common

shares as compensation for services provided

to the Bank. The obligation related to share

units is included in other liabilities on the

Consolidated Balance Sheet.

Compensation expense is recognized based on

the fair value of the share units at the grant

date adjusted for changes in fair value

between the grant date and the

vesting date, net of hedging activities,

over the service period required for

employees to become fully entitled

to the awards. This period is generally

equal to the

vesting period,

in addition to a period prior to the grant

date. For the Bank’s share units, this period is

generally equal to four years.

Employee Benefits

EMPLOYEE BENEFITS

Defined Benefit Plans

Actuarial valuations are prepared at least

every three years to determine the present

value of the projected benefit obligation

related to the Bank’s defined benefit

plans. In periods between actuarial valuations,

an extrapolation is performed based

on the most recent valuation completed. All

remeasurement gains and losses

are recognized immediately in other comprehensive

income, with cumulative gains and losses

reclassified to retained earnings. Pension

and post-retirement

defined benefit plan expenses are determined

based upon separate actuarial valuations

using the projected benefit method pro-rated

on service and

management’s best estimates of discount rate,

compensation increases, health care

cost trend rate, and mortality rates, which are

reviewed annually with the

Bank’s actuaries. The discount rate used to value liabilities

is determined by reference to market

yields on high-quality corporate bonds with terms

matching the

plans’ specific cash flows

The expense recognized includes the cost of

benefits for employee service provided in

the current year, net interest expense or income

on the net defined benefit liability or asset, past

service costs related to plan amendments,

curtailments or settlements, and administrative

costs. Plan amendment

costs are recognized in the period of a plan amendment,

irrespective of its vested status. Curtailments

and settlements are recognized by the

Bank when the

curtailment or settlement occurs. A curtailment

occurs when there is a significant reduction

in the number of employees covered by

the plan. A settlement occurs

when the Bank enters into a transaction that

eliminates all further legal or constructive

obligation for part or all of the benefits

provided under a defined benefit plan.

The fair value of plan assets and the present

value of the projected benefit obligation are

measured as at October 31. The net defined

benefit asset or liability

represents the difference between the cumulative remeasurement

gains and losses, expenses,

and recognized contributions and is reported

in other assets or

other liabilities.

Net defined benefit assets recognized by

the Bank are subject to a ceiling which limits

the asset recognized on the Consolidated

Balance Sheet to the amount

that is recoverable through refunds of contributions

or future contribution holidays. In addition,

where a regulatory funding deficit exists related

to a defined benefit

plan, the Bank is required to record a liability

equal to the present value of all future

cash payments required to eliminate that

deficit.

Defined Contribution Plans

For defined contribution plans, annual pension

expense is equal to the Bank’s contributions

to those plans.

Insurance

INSURANCE

Insurance contracts are aggregated into groups

which are measured at the risk-adjusted present

value of cash flows in fulfilling the contracts.

Insurance revenue is

recognized on the Consolidated Statement of

Income as insurance services are provided

over the coverage period of the contracts

within the groups. Insurance

service expenses are reported on the

Consolidated Statement of Income as insurance

claims and related expenses are recognized and

when contract groups are

expected to be onerous.

Contract groups are onerous if their fulfilment

cash flows are expected to result in a net outflow. The liabilities

from insurance groups are

comprised of the liability for remaining

coverage (LRC) and the liability for incurred

claims (LIC) and are reported as Insurance

contract liabilities on the

Consolidated Balance Sheet. The LRC is

the obligation to investigate and pay claims

that have not yet occurred and includes a loss

component related to onerous

contract groups. The LIC is the estimate

of claims incurred, including claims that

have occurred but have not been reported,

and related insurance costs.

The Bank measures its insurance contract

groups using one of two measurement models,

the premium allocation approach (PAA) or the general measurement

model (GMM). The majority of insurance

contract groups are measured using the PAA, which includes

the Bank’s property and casualty insurance contracts

and

short-term life and health insurance contracts.

The PAA is a simplified model applied to insurance contracts

that are either one year or less or where the PAA

approximates the GMM. Contracts using

the GMM are longer-term life and health

contracts.

The LRC for insurance contract groups using

the PAA is measured as the premiums received less insurance

acquisition cash flows paid. The LRC is adjusted

for the recognition of insurance revenue

and amortization of acquisition cash flows reported

in insurance service expenses on a straight-line

basis over the

contractual terms of the underlying insurance

contracts, usually twelve months. The

LRC for longer term contracts using the GMM

model is measured using

estimates and assumptions that reflect

the timing and uncertainty of insurance

cash flows. Under both the PAA and GMM, when a group of contracts

is expected

to be onerous, a loss component (expected

loss related to fulfilling the group’s insurance

contracts) is established which increases

the LRC and insurance service

expenses. The loss component of the LRC

is subsequently recognized as a reduction

to insurance service expenses over

the contractual term of the underlying

insurance contracts to offset claims incurred

and related expenses.

The Bank measures the LIC at the present

value of current estimates of claims and related

costs for insurable events occurring at or before

the Consolidated

Balance Sheet date. The LIC includes a risk

adjustment, which represents the compensation

the Bank requires for bearing the uncertainty

related to non-financial

risks in its fulfilment of insurance contracts.

Expenses related to claims incurred, including

claims arising from catastrophes, and related

costs are reported in

insurance service expenses while changes

related to discounting the liability are recorded

as insurance finance income or expenses in

other income (loss).

Estimates used in the measurement

of insurance contract liabilities are determined

in accordance with accepted actuarial practices.

Current estimates of claims

and related expenses are determined on a

case-by-case basis and consider such

variables as past loss experience, current

claims trends and changes in the

prevailing social, economic, and legal environment.

These estimates are continually reviewed,

and as experience develops and new information

becomes known,

the estimates are adjusted as necessary. In addition to reported

claims information, the Bank’s insurance

contract liabilities include a provision to

account for the

future development of insurance claims, including

insurance claims incurred but not reported

by policyholders (IBNR). IBNR liabilities are

evaluated based on

historical development trends and actuarial

methodologies for groups of claims

with similar attributes.

Reinsurance contracts held are recognized

and measured using the same principles

as insurance contracts. Reinsurance contract assets

are presented in

Other assets on the Consolidated Balance

Sheet and the net results from reinsurance

contracts held are presented in Other income

(loss) on the Consolidated

Statement of Income. Refer to Note 20 for further

detail on the balances and results of insurance

and reinsurance contracts.

Provisions & Contingent Liabilities

PROVISIONS & CONTINGENT LIABILITIES

Provisions are recognized when the Bank has

a present obligation (legal or constructive)

as a result of a past event, the amount of

which can be reliably estimated,

and it is probable that an outflow of resources

will be required to settle the obligation.

Provisions are measured based on management’s

best estimate of the consideration required

to settle the obligation at the end of the reporting

period, taking

into account the risks and uncertainties surrounding

the obligation. If the effect of the time value of

money is material, provisions are measured

at the present value

of the expenditure expected to be required

to settle the obligation, using a discount rate

that reflects

the current market assessment of the time

value of money and

the risks specific to the obligation.

Contingent liabilities exist when there is a possible

obligation which is yet to be confirmed

or a present obligation which has been confirmed

but the outflow of

future resources is not probable or is not

reliably measurable. Contingent liabilities

are not recorded in the Bank’s Consolidated

Financial Statements and are

disclosed if material unless there is a remote

chance that it will result in a future outflow

of resources to settle.

Income Taxes

INCOME TAXES

Income tax is comprised of current and deferred

tax. Income tax is recognized in the Provision

for (recovery of) income taxes on the

Consolidated Statement of

Income, except to the extent that it relates to items

recognized in other comprehensive income or

directly in equity, in which case the related taxes are also

recognized in other comprehensive income

or directly in equity, respectively.

Deferred tax is recognized on temporary differences

between the carrying amounts of assets

and liabilities on the Consolidated Balance Sheet

and the amounts

attributed to such assets and liabilities for

tax purposes. Deferred tax assets and liabilities

are determined based on the tax rates

that are expected to apply when

the assets or liabilities are reported for

tax purposes. Deferred tax assets are recognized

only when it is probable that sufficient taxable

profit will be available in

future periods against which deductible

temporary differences may be utilized. Deferred

tax liabilities are not recognized on temporary

differences arising on

investments in subsidiaries, branches,

and associates, and interests in joint

ventures if the Bank controls the timing of

the reversal of the temporary difference and

it is probable that the temporary difference will not

reverse in the foreseeable future.

The Bank records a provision for uncertain

tax positions if it is probable that the Bank

will have to make a payment to tax authorities

upon their examination of a

tax position. This provision is measured

at the Bank’s best estimate of the amount expected

to be paid. Provisions are reversed in provision

for (recovery of)

income taxes in the period in which management

determines they are no longer required or

as determined by statute.

Leases

LEASES

An arrangement contains a lease if there is an

identified asset and the Bank has a right

to control that asset for a period of time in exchange

for consideration. A

right-of-use (ROU) asset and lease liability

is recognized for all leases except for

short-term leases and low value leases, as

described below. At the lease

commencement date, the lease liability is initially

recognized at the present value of the

future lease payments over the remaining lease

term and is discounted

using the Bank’s incremental borrowing rate.

The right-of-use asset is recognized

at cost, comprising an amount equal

to the lease liability, subject to certain

adjustments. Subsequently, the right-of-use asset is measured at

cost less accumulated depreciation and impairment

and adjusted for any remeasurement

lease liabilities, while the lease liability is accreted

using the Bank’s incremental borrowing rate.

The lease liability is remeasured when there is a

modification, a

change in the lease term, a change in the lease

payments (e.g., changes to future payments

resulting from a change in an index or rate used

to determine such

lease payments) or changes in the Bank’s assumptions

or strategies relating to the exercise

of purchase, extension, or termination options.

The Bank’s leases consist primarily of real estate,

equipment and other asset leases. Right-of-use

assets are recorded in Land, buildings,

equipment, other

depreciable assets and right-of-use assets

on the Consolidated Balance Sheet and

lease liabilities are included in Other liabilities

on the Consolidated Balance

Sheet. Interest expense on lease liabilities is

included in Net interest income and depreciation

expense on the right-of-use assets

is recognized in Non-interest

expenses on the Consolidated Statement

of Income.

Short-term leases, which have a lease term of

twelve months

or less, and leases of low-value assets

are exempt, and their payments are recognized

in Non-

interest expenses on a straight-line basis

within the Bank’s Consolidated Statement of

Income.