Loans, impaired loans and allowance for credit losses (Tables)

6 Months Ended

Apr. 30, 2022

Text Block [Abstract]

Disclosure of loans at amortized cost

(a) Loans at amortized cost

	As at
	April 30, 2022
($ millions)	Gross carrying amount		Allowance for credit losses		Net carrying amount
Residential mortgages	$	337,714	$	834	$	336,880
Personal loans		94,437		2,171		92,266
Credit cards		13,622		1,107		12,515
Business and government		249,223		1,182		248,041
Total	$	694,996	$	5,294	$	689,702

	As at
	January 31, 2022						October 31, 2021
($ millions)	Gross carrying amount		Allowance for credit losses		Net carrying amount		Gross carrying amount		Allowance for credit losses		Net carrying amount
Residential mortgages	$	330,991	$	835	$	330,156	$	319,678	$	802	$	318,876
Personal loans		92,622		2,249		90,373		91,540		2,341		89,199
Credit cards		13,145		1,165		11,980		12,450		1,211		11,239
Business and government		236,072		1,243		234,829		218,944		1,272		217,672
Total	$	672,830	$	5,492	$	667,338	$	642,612	$	5,626	$	636,986

Schedule of Impaired Loans

(b) Impaired loans(1)(2)

	As at
	April 30, 2022
($ millions)	Gross impaired loans		Allowance for credit losses		Net carrying amount
Residential mortgages	$	1,273	$	393	$	880
Personal loans		767		566		201
Credit cards		–		–		–
Business and government		2,224		645		1,579
Total	$	4,264	$	1,604	$	2,660
By geography:
Canada	$	968	$	412	$	556
United States		–		–		–
Mexico		795		289		506
Peru		676		353		323
Chile		543		189		354
Colombia		377		78		299
Other international		905		283		622
Total	$	4,264	$	1,604	$	2,660

	As at
	January 31, 2022						October 31, 2021
($ millions)	Gross impaired loans		Allowance for credit losses		Net carrying amount		Gross impaired loans		Allowance for credit losses		Net carrying amount
Residential mortgages	$	1,320	$	395	$	925	$	1,331	$	374	$	957
Personal loans		820		574		246		833		626		207
Credit cards		–		–		–		–		–		–
Business and government		2,295		654		1,641		2,292		655		1,637
Total	$	4,435	$	1,623	$	2,812	$	4,456	$	1,655	$	2,801
By geography:
Canada	$	1,055	$	426	$	629	$	1,090	$	446	$	644
United States		16		–		16		24		4		20
Mexico		775		281		494		758		269		489
Peru		716		350		366		699		350		349
Chile		540		194		346		512		180		332
Colombia		373		78		295		418		88		330
Other international		960		294		666		955		318		637
Total	$	4,435	$	1,623	$	2,812	$	4,456	$	1,655	$	2,801

(1) Interest income recognized on impaired loans during the three months ended April 30, 2022 was $11 (January 31, 2022 – $13; October 31, 2021 – $12).

(2) Additional interest income of approximately $63 would have been recorded if the above loans had not been classified as impaired (January 31, 2022 – $61; October 31, 2021 – $58).

Summary of Key Macroeconomic Variables Used for Allowance for Credit Losses Calculations

The following table shows certain key macroeconomic variables used to estimate the allowance for credit losses. For the base case, optimistic and pessimistic scenarios, the projections are provided for the next 12 months and for the remaining forecast period, which represents a medium-term view.

	Base Case Scenario				Alternative Scenario - Optimistic				Alternative Scenario - Pessimistic				Alternative Scenario - Very Pessimistic
As at April 30, 2022	Next 12 Months		Remaining Forecast Period		Next 12 Months		Remaining Forecast Period		Next 12 Months		Remaining Forecast Period		Next 12 Months		Remaining Forecast Period
Canada
Real GDP growth, y/y % change		4.6		2.0		6.6		2.9		-0.8		3.8		-2.2		2.7
Unemployment rate, average %		5.0		6.1		4.2		4.5		9.1		6.9		9.6		8.5
Bank of Canada overnight rate target, average %		2.2		2.4		2.8		3.4		3.5		3.0		3.5		3.4
HPI - Housing Price Index, y/y % change		16.6		-0.7		19.5		0.9		11.4		0.5		9.8		-0.5
USD/CAD exchange rate, average		1.21		1.23		1.20		1.22		1.21		1.22		1.21		1.22
US
Real GDP growth, y/y % change		3.9		1.9		5.3		2.6		-1.9		3.6		-3.5		2.9
Unemployment rate, average %		3.8		4.2		3.5		3.8		7.4		4.8		7.8		6.2
Mexico
Real GDP growth, y/y % change		1.7		1.8		2.9		2.5		-3.7		3.2		-4.7		1.8
Unemployment rate, average %		4.0		3.9		3.6		3.0		7.4		4.9		7.7		6.5
Chile
Real GDP growth, y/y % change		1.8		2.1		3.6		3.5		-3.2		3.6		-4.1		2.9
Unemployment rate, average %		6.2		5.9		5.7		5.2		9.9		6.4		10.7		7.0
Peru
Real GDP growth, y/y % change		2.6		3.0		4.5		4.7		-1.2		4.1		-2.7		1.1
Unemployment rate, average %		7.8		7.0		6.9		4.2		10.5		8.0		11.7		12.0
Colombia
Real GDP growth, y/y % change		4.3		3.5		5.8		5.1		0.5		4.7		-0.2		2.9
Unemployment rate, average %		10.8		10.3		10.1		7.9		13.3		11.2		13.6		13.6
Caribbean
Real GDP growth, y/y % change		4.6		4.0		5.7		4.8		0.8		5.2		-0.6		3.9
Global
WTI oil price, average USD/bbl		96		77		102		95		129		81		140		117
Copper price, average USD/lb		4.18		4.20		4.33		4.75		4.63		4.23		4.77		4.57
Global GDP, y/y % change		3.91		2.72		5.27		3.61		-1.35		4.27		-2.78		3.76
	Base Case Scenario				Alternative Scenario - Optimistic				Alternative Scenario - Pessimistic				Alternative Scenario - Very Pessimistic
As at January 31, 2022	Next 12 Months		Remaining Forecast Period		Next 12 Months		Remaining Forecast Period		Next 12 Months		Remaining Forecast Period		Next 12 Months		Remaining Forecast Period
Canada
Real GDP growth, y/y % change		4.2		1.6		6.1		2.5		0.0		2.7		-4.6		3.5
Unemployment rate, average %		5.2		5.5		4.5		4.0		7.7		6.1		10.6		8.0
Bank of Canada overnight rate target, average %		0.9		2.4		1.5		3.7		0.3		1.9		0.3		1.2
HPI - Housing Price Index, y/y % change		9.9		1.9		12.5		3.1		3.0		3.1		-3.5		3.7
USD/CAD exchange rate, average		1.21		1.20		1.20		1.19		1.25		1.20		1.27		1.23
US
Real GDP growth, y/y % change		4.2		1.9		5.4		2.6		1.2		2.7		-2.2		3.6
Unemployment rate, average %		4.1		4.2		3.9		3.8		5.8		4.8		7.1		6.2
Mexico
Real GDP growth, y/y % change		2.8		1.9		4.4		2.0		0.0		2.5		-2.6		2.8
Unemployment rate, average %		4.0		3.8		3.4		3.2		6.5		4.3		9.4		6.2
Chile
Real GDP growth, y/y % change		4.6		3.0		6.8		4.0		2.0		3.4		-2.4		4.2
Unemployment rate, average %		6.6		6.3		6.0		5.5		9.1		6.9		12.0		8.8
Peru
Real GDP growth, y/y % change		2.6		3.0		4.5		3.8		-0.6		3.8		-4.5		4.9
Unemployment rate, average %		8.7		7.4		5.8		5.1		11.2		8.0		14.1		9.9
Colombia
Real GDP growth, y/y % change		4.5		3.5		6.5		4.8		1.2		4.4		-2.6		5.4
Unemployment rate, average %		10.8		10.4		10.0		7.7		13.3		10.9		16.2		12.8
Caribbean
Real GDP growth, y/y % change		4.8		4.0		6.4		4.1		2.0		4.6		-0.6		4.9
Global
WTI oil price, average USD/bbl		69		71		75		87		59		66		56		59
Copper price, average USD/lb		4.25		4.15		4.46		4.72		3.95		3.89		3.82		3.56
Global GDP, y/y % change		4.32		3.57		5.66		4.47		1.96		4.17		-0.55		4.85

	Base Case Scenario				Alternative Scenario - Optimistic				Alternative Scenario - Pessimistic				Alternative Scenario - Very Pessimistic
As at October 31, 2021	Next 12 Months		Remaining Forecast Period		Next 12 Months		Remaining Forecast Period		Next 12 Months		Remaining Forecast Period		Next 12 Months		Remaining Forecast Period
Canada
Real GDP growth, y/y % change		3.4		1.9		5.3		2.8		-1.3		3.1		-7.4		4.3
Unemployment rate, average %		6.3		5.7		5.6		4.1		8.8		6.3		11.7		8.2
Bank of Canada overnight rate target, average %		0.3		2.0		0.9		3.6		0.3		1.2		0.3		0.5
HPI - Housing Price Index, y/y % change		11.1		2.1		13.2		3.9		3.9		3.3		-2.7		3.9
USD/CAD exchange rate, average		1.24		1.21		1.23		1.20		1.28		1.21		1.30		1.24
US
Real GDP growth, y/y % change		5.7		1.6		7.3		2.1		2.4		2.4		-1.4		3.5
Unemployment rate, average %		3.8		3.5		3.4		3.2		5.6		4.1		6.8		5.6
Mexico
Real GDP growth, y/y % change		2.8		1.9		4.3		2.7		-0.4		2.7		-4.2		3.8
Unemployment rate, average %		4.0		4.0		3.6		3.1		6.5		4.5		9.4		6.4
Chile
Real GDP growth, y/y % change		6.7		2.2		8.8		3.1		3.4		3.1		-0.5		4.2
Unemployment rate, average %		6.5		6.2		5.9		5.6		9.0		6.7		12.0		8.6
Peru
Real GDP growth, y/y % change		5.0		3.2		7.7		4.3		3.6		3.7		0.0		4.7
Unemployment rate, average %		8.8		7.5		6.0		3.4		10.8		8.1		13.8		10.0
Colombia
Real GDP growth, y/y % change		5.0		3.5		6.8		4.8		3.6		4.0		0.0		5.0
Unemployment rate, average %		13.7		11.2		12.0		8.2		15.6		11.8		18.6		13.7
Caribbean
Real GDP growth, y/y % change		4.9		4.1		6.2		4.9		3.9		4.6		0.3		5.6
Global
WTI oil price, average USD/bbl		69		70		75		86		61		67		57		57
Copper price, average USD/lb		4.20		4.20		4.36		4.78		3.93		4.05		3.81		3.62
Global GDP, y/y % change		5.07		3.02		6.54		3.90		2.44		3.68		-0.69		4.48

Schedule of Allowance for Credit Losses

(iv) Allowance for credit losses

Allowance for credit losses
($ millions)	Balance as at November 1, 2021		Provision for credit losses		Net write-offs			Other, including foreign currency adjustment			Balance as at April 30, 2022
Residential mortgages	$	802	$	32	$	(23	)	$	23		$	834
Personal loans		2,341		235		(451	)		46			2,171
Credit cards		1,211		159		(277	)		14			1,107
Business and government		1,374		15		(128	)		(3	)		1,258
	$	5,728	$	441	$	(879	)	$	80		$	5,370
Presented as:
Allowance for credit losses on loans	$	5,626									$	5,294
Allowance for credit losses on acceptances(1)		37										27
Allowance for credit losses on off-balance sheet exposures(2)		65										49

(1) Allowance for credit losses on acceptances are recorded against the financial asset in the Consolidated Statement of Financial Position.

(2) Allowance for credit losses on off-balance sheet exposures is recorded in other liabilities in the Consolidated Statement of Financial Position.

($ millions)	Balance as at November 1, 2020		Provision for credit losses		Net write-offs			Other, including foreign currency adjustment			Balance as at April 30, 2021
Residential mortgages	$	884	$	51	$	(49	)	$	(45	)	$	841
Personal loans		3,155		611		(826	)		(134	)		2,806
Credit cards		1,886		504		(761	)		(84	)		1,545
Business and government		1,892		94		(179	)		(110	)		1,697
	$	7,817	$	1,260	$	(1,815	)	$	(373	)	$	6,889
Presented as:
Allowance for credit losses on loans	$	7,639									$	6,716
Allowance for credit losses on acceptances(1)		77										73
Allowance for credit losses on off-balance sheet exposures(2)		101										100

(1) Allowance for credit losses on acceptances are recorded against the financial asset in the Consolidated Statement of Financial Position.

(2) Allowance for credit losses on off-balance sheet exposures is recorded in other liabilities in the Consolidated Statement of Financial Position.

Allowance for credit losses on loans	As at April 30, 2022
($ millions)	Stage 1		Stage 2		Stage 3		Total
Residential mortgages	$	168	$	273	$	393	$	834
Personal loans		655		950		566		2,171
Credit cards		419		688		–		1,107
Business and government		202		335		645		1,182
Total(1)	$	1,444	$	2,246	$	1,604	$	5,294

(1) Excludes allowance for credit losses of $81 for other financial assets including acceptances, investment securities, deposits with banks, off-balance sheet credit risks and reverse repos.

	As at October 31, 2021
($ millions)	Stage 1		Stage 2		Stage 3		Total
Residential mortgages	$	152	$	276	$	374	$	802
Personal loans		644		1,071		626		2,341
Credit cards		352		859		–		1,211
Business and government		186		431		655		1,272
Total(1)	$	1,334	$	2,637	$	1,655	$	5,626

(1) Excludes allowance for credit losses of $105 for other financial assets including acceptances, investment securities, deposits with banks and off-balance sheet credit risks.

	As at April 30, 2021
($ millions)	Stage 1		Stage 2		Stage 3		Total
Residential mortgages	$	151	$	280	$	410	$	841
Personal loans		699		1,286		821		2,806
Credit cards		319		1,226		–		1,545
Business and government		303		514		707		1,524
Total(1)	$	1,472	$	3,306	$	1,938	$	6,716

(1) Excludes allowance for credit losses of $177 for other financial assets including acceptances, investment securities, deposits with banks and off-balance sheet credit risks.

The following table presents the changes to the allowance for credit losses on loans.

	As at and for the three months ended
	April 30, 2022												April 30, 2021
($ millions)	Stage 1			Stage 2			Stage 3			Total			Stage 1			Stage 2			Stage 3			Total
Retail loans:
Residential mortgages
Balance at beginning of period	$	161		$	279		$	395		$	835		$	161		$	297		$	406		$	864
Provision for credit losses
Remeasurement(1)		(15	)		7			9			1			(30	)		7			48			25
Newly originated or purchased financial assets		10			–			–			10			10			–			–			10
Derecognition of financial assets and maturities		(1	)		(4	)		–			(5	)		(2	)		(7	)		–			(9	)
Changes in models and methodologies		–			–			–			–			–			–			–			–
Transfer to (from):
Stage 1		14			(12	)		(2	)		–			19			(15	)		(4	)		–
Stage 2		(2	)		9			(7	)		–			(3	)		17			(14	)		–
Stage 3		–			(3	)		3			–			–			(11	)		11			–
Gross write-offs		–			–			(16	)		(16	)		–			–			(22	)		(22	)
Recoveries		–			–			7			7			–			–			6			6
Foreign exchange and other movements		1			(3	)		4			2			(4	)		(8	)		(21	)		(33	)
Balance at end of period(2)	$	168		$	273		$	393		$	834		$	151		$	280		$	410		$	841
Personal loans
Balance at beginning of period	$	655		$	1,020		$	574		$	2,249		$	787		$	1,514		$	849		$	3,150
Provision for credit losses
Remeasurement(1)		(162	)		94			161			93			(264	)		176			327			239
Newly originated or purchased financial assets		75			–			–			75			154			–			–			154
Derecognition of financial assets and maturities		(17	)		(27	)		–			(44	)		(67	)		(82	)		–			(149	)
Changes in models and methodologies		–			–			–			–			–			–			–			–
Transfer to (from):
Stage 1		127			(125	)		(2	)		–			204			(200	)		(4	)		–
Stage 2		(26	)		39			(13	)		–			(85	)		104			(19	)		–
Stage 3		(1	)		(49	)		50			–			(8	)		(184	)		192			–
Gross write-offs		–			–			(275	)		(275	)		–			–			(547	)		(547	)
Recoveries		–			–			64			64			–			–			64			64
Foreign exchange and other movements		4			(2	)		7			9			(22	)		(42	)		(41	)		(105	)
Balance at end of period(2)	$	655		$	950		$	566		$	2,171		$	699		$	1,286		$	821		$	2,806
Credit cards
Balance at beginning of period	$	399		$	766		$	–		$	1,165		$	448		$	1,467		$	–		$	1,915
Provision for credit losses
Remeasurement(1)		(37	)		3			106			72			(177	)		119			323			265
Newly originated or purchased financial assets		32			–			–			32			19			–			–			19
Derecognition of financial assets and maturities		(10	)		(8	)		–			(18	)		(17	)		(24	)		–			(41	)
Changes in models and methodologies		–			–			–			–			–			–			–			–
Transfer to (from):
Stage 1		52			(52	)		–			–			91			(91	)		–			–
Stage 2		(13	)		13			–			–			(32	)		32			–			–
Stage 3		–			(33	)		33			–			–			(228	)		228			–
Gross write-offs		–			–			(186	)		(186	)		–			–			(587	)		(587	)
Recoveries		–			–			48			48			–			–			42			42
Foreign exchange and other movements		(4	)		(1	)		(1	)		(6	)		(13	)		(49	)		(6	)		(68	)
Balance at end of period(2)	$	419		$	688		$	–		$	1,107		$	319		$	1,226		$	–		$	1,545
Total retail loans
Balance at beginning of period	$	1,215		$	2,065		$	969		$	4,249		$	1,396		$	3,278		$	1,255		$	5,929
Provision for credit losses
Remeasurement(1)		(214	)		104			276			166			(471	)		302			698			529
Newly originated or purchased financial assets		117			–			–			117			183			–			–			183
Derecognition of financial assets and maturities		(28	)		(39	)		–			(67	)		(86	)		(113	)		–			(199	)
Changes in models and methodologies		–			–			–			–			–			–			–			–
Transfer to (from):
Stage 1		193			(189	)		(4	)		–			314			(306	)		(8	)		–
Stage 2		(41	)		61			(20	)		–			(120	)		153			(33	)		–
Stage 3		(1	)		(85	)		86			–			(8	)		(423	)		431			–
Gross write-offs		–			–			(477	)		(477	)		–			–			(1,156	)		(1,156	)
Recoveries		–			–			119			119			–			–			112			112
Foreign exchange and other movements		1			(6	)		10			5			(39	)		(99	)		(68	)		(206	)
Balance at end of period(2)	$	1,242		$	1,911		$	959		$	4,112		$	1,169		$	2,792		$	1,231		$	5,192
Non-retail loans:
Business and government
Balance at beginning of period	$	233		$	411		$	654		$	1,298		$	459		$	600		$	739		$	1,798
Provision for credit losses
Remeasurement(1)		(23	)		(9	)		72			40			(79	)		–			103			24
Newly originated or purchased financial assets		65			–			–			65			79			–			–			79
Derecognition of financial assets and maturities		(55	)		(36	)		(7	)		(98	)		(85	)		(12	)		(1	)		(98	)
Changes in models and methodologies		(1	)		2			–			1			(4	)		(11	)		–			(15	)
Transfer to (from):
Stage 1		19			(19	)		–			–			10			(10	)		–			–
Stage 2		(4	)		4			–			–			(18	)		19			(1	)		–
Stage 3		–			(3	)		3			–			–			(3	)		3			–
Gross write-offs		–			–			(73	)		(73	)		–			–			(105	)		(105	)
Recoveries		–			–			9			9			–			–			8			8
Foreign exchange and other movements		–			2			(13	)		(11	)		(9	)		(19	)		(39	)		(67	)
Balance at end of period including off-balance sheet exposures(2)	$	234		$	352		$	645		$	1,231		$	353		$	564		$	707		$	1,624
Less: Allowance for credit losses on off-balance sheet exposures(3)		(32	)		(17	)		–			(49	)		(50	)		(50	)		–			(100	)
Balance at end of period(2)	$	202		$	335		$	645		$	1,182		$	303		$	514		$	707		$	1,524

The following table presents the changes to the allowance for credit losses on loans.

	As at and for the six months ended
	April 30, 2022												April 30, 2021
($ millions)	Stage 1			Stage 2			Stage 3			Total			Stage 1			Stage 2			Stage 3			Total
Retail loans:
Residential mortgages
Balance at beginning of period	$	152		$	276		$	374		$	802		$	190		$	302		$	392		$	884
Provision for credit losses
Remeasurement(1)		(34	)		18			38			22			(95	)		36			107			48
Newly originated or purchased financial assets		20			–			–			20			21			–			–			21
Derecognition of financial assets and maturities		(3	)		(7	)		–			(10	)		(5	)		(13	)		–			(18	)
Changes in models and methodologies		–			–			–			–			–			–			–			–
Transfer to (from):
Stage 1		33			(29	)		(4	)		–			51			(42	)		(9	)		–
Stage 2		(4	)		16			(12	)		–			(6	)		37			(31	)		–
Stage 3		–			(6	)		6			–			–			(23	)		23			–
Gross write-offs		–			–			(37	)		(37	)		–			–			(59	)		(59	)
Recoveries		–			–			14			14			–			–			10			10
Foreign exchange and other movements		4			5			14			23			(5	)		(17	)		(23	)		(45	)
Balance at end of period(2)	$	168		$	273		$	393		$	834		$	151		$	280		$	410		$	841
Personal loans
Balance at beginning of period	$	644		$	1,071		$	626		$	2,341		$	864		$	1,471		$	820		$	3,155
Provision for credit losses
Remeasurement(1)		(318	)		189			305			176			(686	)		712			579			605
Newly originated or purchased financial assets		150			–			–			150			253			–			–			253
Derecognition of financial assets and maturities		(35	)		(56	)		–			(91	)		(95	)		(152	)		–			(247	)
Changes in models and methodologies		–			–			–			–			–			–			–			–
Transfer to (from):
Stage 1		257			(252	)		(5	)		–			605			(598	)		(7	)		–
Stage 2		(56	)		83			(27	)		–			(177	)		215			(38	)		–
Stage 3		(2	)		(99	)		101			–			(39	)		(310	)		349			–
Gross write-offs		–			–			(582	)		(582	)		–			–			(953	)		(953	)
Recoveries		–			–			131			131			–			–			127			127
Foreign exchange and other movements		15			14			17			46			(26	)		(52	)		(56	)		(134	)
Balance at end of period(2)	$	655		$	950		$	566		$	2,171		$	699		$	1,286		$	821		$	2,806
Credit cards
Balance at beginning of period	$	352		$	859		$	–		$	1,211		$	501		$	1,385		$	–		$	1,886
Provision for credit losses
Remeasurement(1)		(89	)		8			215			134			(310	)		377			474			541
Newly originated or purchased financial assets		60			–			–			60			48			–			–			48
Derecognition of financial assets and maturities		(20	)		(15	)		–			(35	)		(32	)		(53	)		–			(85	)
Changes in models and methodologies		–			–			–			–			–			–			–			–
Transfer to (from):
Stage 1		139			(139	)		–			–			204			(204	)		–			–
Stage 2		(26	)		26			–			–			(75	)		75			–			–
Stage 3		–			(61	)		61			–			–			(298	)		298			–
Gross write-offs		–			–			(378	)		(378	)		–			–			(847	)		(847	)
Recoveries		–			–			101			101			–			–			86			86
Foreign exchange and other movements		3			10			1			14			(17	)		(56	)		(11	)		(84	)
Balance at end of period(2)	$	419		$	688		$	–		$	1,107		$	319		$	1,226		$	–		$	1,545
Total retail loans
Balance at beginning of period	$	1,148		$	2,206		$	1,000		$	4,354		$	1,555		$	3,158		$	1,212		$	5,925
Provision for credit losses
Remeasurement(1)		(441	)		215			558			332			(1,091	)		1,125			1,160			1,194
Newly originated or purchased financial assets		230			–			–			230			322			–			–			322
Derecognition of financial assets and maturities		(58	)		(78	)		–			(136	)		(132	)		(218	)		–			(350	)
Changes in models and methodologies		–			–			–			–			–			–			–			–
Transfer to (from):
Stage 1		429			(420	)		(9	)		–			860			(844	)		(16	)		–
Stage 2		(86	)		125			(39	)		–			(258	)		327			(69	)		–
Stage 3		(2	)		(166	)		168			–			(39	)		(631	)		670			–
Gross write-offs		–			–			(997	)		(997	)		–			–			(1,859	)		(1,859	)
Recoveries		–			–			246			246			–			–			223			223
Foreign exchange and other movements		22			29			32			83			(48	)		(125	)		(90	)		(263	)
Balance at end of period(2)	$	1,242		$	1,911		$	959		$	4,112		$	1,169		$	2,792		$	1,231		$	5,192
Non-retail loans:
Business and government
Balance at beginning of period	$	212		$	470		$	655		$	1,337		$	478		$	592		$	745		$	1,815
Provision for credit losses
Remeasurement(1)		(53	)		(23	)		148			72			(89	)		21			209			141
Newly originated or purchased financial assets		121			–			–			121			168			–			–			168
Derecognition of financial assets and maturities		(96	)		(56	)		(18	)		(170	)		(168	)		(25	)		(3	)		(196	)
Changes in models and methodologies		(1	)		2			–			1			(4	)		(11	)		–			(15	)
Transfer to (from):
Stage 1		61			(61	)		–			–			28			(28	)		–			–
Stage 2		(12	)		12			–			–			(42	)		43			(1	)		–
Stage 3		–			(3	)		3			–			–			(4	)		4			–
Gross write-offs		–			–			(146	)		(146	)		–			–			(192	)		(192	)
Recoveries		–			–			18			18			–			–			13			13
Foreign exchange and other movements		2			11			(15	)		(2	)		(18	)		(24	)		(68	)		(110	)
Balance at end of period including off-balance sheet exposures(2)	$	234		$	352		$	645		$	1,231		$	353		$	564		$	707		$	1,624
Less: Allowance for credit losses on off-balance sheet exposures(3)		(32	)		(17	)		–			(49	)		(50	)		(50	)		–			(100	)
Balance at end of period(2)	$	202		$	335		$	645		$	1,182		$	303		$	514		$	707		$	1,524

(1) Includes credit risk changes as a result of significant increases in credit risk, changes in credit risk that did not result in a transfer between stages, changes in model inputs and assumptions and changes due to drawdowns of undrawn commitments. 

(2) Interest income on impaired loans for residential mortgages, personal and credit cards, and business and government loans for the three months ended April 30, 2022 totaled $63 (April 30, 2021 - $73) and for the six months ended April 30, 2022 totaled $124 (April 30, 2021 - $151).

(3) Allowance for credit losses on off-balance sheet exposures is recorded in other liabilities in the Consolidated Statement of Financial Position.

Summary of Carrying Value of Exposures by Risk Rating

CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(d) Carrying value of exposures by risk rating

Residential mortgages	As at April 30, 2022								As at October 31, 2021
Category of PD grades ($ millions)	Stage 1		Stage 2		Stage 3(1)		Total		Stage 1		Stage 2		Stage 3(1)		Total
Very low	$	198,894	$	2,104	$	–	$	200,998	$	187,163	$	5,610	$	–	$	192,773
Low		79,199		644		–		79,843		69,306		1,768		–		71,074
Medium		17,222		959		–		18,181		9,170		3,690		–		12,860
High		2,503		1,155		–		3,658		904		2,284		–		3,188
Very high		57		1,197		–		1,254		16		643		–		659
Loans not graded(2)		29,967		2,540		–		32,507		34,122		3,671		–		37,793
Default		–		–		1,273		1,273		–		–		1,331		1,331
Total	$	327,842	$	8,599	$	1,273	$	337,714	$	300,681	$	17,666	$	1,331	$	319,678
Allowance for credit losses		168		273		393		834		152		276		374		802
Carrying value	$	327,674	$	8,326	$	880	$	336,880	$	300,529	$	17,390	$	957	$	318,876

(1) Stage 3 includes purchased or originated credit-impaired loans.

(2) Portfolios where the customer account level ‘Probability of Default’ has not been determined have been included in the ‘Loans not graded’ category.

Personal loans	As at April 30, 2022								As at October 31, 2021
Category of PD grades ($ millions)	Stage 1		Stage 2		Stage 3(1)		Total		Stage 1		Stage 2		Stage 3(1)		Total
Very low	$	29,855	$	150	$	–	$	30,005	$	30,085	$	168	$	–	$	30,253
Low		26,809		322		–		27,131		25,719		574		–		26,293
Medium		8,407		1,028		–		9,435		8,290		1,127		–		9,417
High		6,937		1,804		–		8,741		5,686		2,307		–		7,993
Very high		74		1,511		–		1,585		82		1,157		–		1,239
Loans not graded(2)		15,543		1,230		–		16,773		14,159		1,353		–		15,512
Default		–		–		767		767		–		–		833		833
Total	$	87,625	$	6,045	$	767	$	94,437	$	84,021	$	6,686	$	833	$	91,540
Allowance for credit losses		655		950		566		2,171		644		1,071		626		2,341
Carrying value	$	86,970	$	5,095	$	201	$	92,266	$	83,377	$	5,615	$	207	$	89,199

(1) Stage 3 includes purchased or originated credit-impaired loans.

(2) Portfolios where the customer account level ‘Probability of Default’ has not been determined have been included in the ‘Loans not graded’ category.

Credit cards	As at April 30, 2022								As at October 31, 2021
Category of PD grades ($ millions)	Stage 1		Stage 2		Stage 3		Total		Stage 1		Stage 2		Stage 3		Total
Very low	$	1,559	$	52	$	–	$	1,611	$	1,517	$	76	$	–	$	1,593
Low		2,672		108		–		2,780		2,288		135		–		2,423
Medium		3,357		67		–		3,424		2,666		166		–		2,832
High		3,087		803		–		3,890		2,237		1,225		–		3,462
Very high		44		522		–		566		21		509		–		530
Loans not graded(1)		973		378		–		1,351		1,158		452		–		1,610
Default		–		–		–		–		–		–		–		–
Total	$	11,692	$	1,930	$	–	$	13,622	$	9,887	$	2,563	$	–	$	12,450
Allowance for credit losses		419		688		–		1,107		352		859		–		1,211
Carrying value	$	11,273	$	1,242	$	–	$	12,515	$	9,535	$	1,704	$	–	$	11,239

(1) Portfolios where the customer account level ‘Probability of Default’ has not been determined have been included in the ‘Loans not graded’ category.

Undrawn loan commitments – Retail	As at April 30, 2022								As at October 31, 2021
Category of PD grades ($ millions)	Stage 1		Stage 2		Stage 3		Total		Stage 1		Stage 2		Stage 3		Total
Very low	$	93,791	$	11	$	–	$	93,802	$	88,308	$	14	$	–	$	88,322
Low		20,251		8		–		20,259		17,880		12		–		17,892
Medium		7,734		33		–		7,767		6,858		36		–		6,894
High		3,785		316		–		4,101		3,103		745		–		3,848
Very high		41		321		–		362		24		212		–		236
Loans not graded(1)		8,682		1,314		–		9,996		9,126		2,204		–		11,330
Default		–		–		–		–		–		–		–		–
Carrying value	$	134,284	$	2,003	$	–	$	136,287	$	125,299	$	3,223	$	–	$	128,522

(1) Portfolios where the customer account level ‘Probability of Default’ has not been determined have been included in the ‘Loans not graded’ category.

 

Total retail loans	As at April 30, 2022								As at October 31, 2021
Category of PD grades ($ millions)	Stage 1		Stage 2		Stage 3(1)		Total		Stage 1		Stage 2		Stage 3(1)		Total
Very low	$	324,099	$	2,317	$	–	$	326,416	$	307,073	$	5,868	$	–	$	312,941
Low		128,931		1,082		–		130,013		115,193		2,489		–		117,682
Medium		36,720		2,087		–		38,807		26,984		5,019		–		32,003
High		16,312		4,078		–		20,390		11,930		6,561		–		18,491
Very high		216		3,551		–		3,767		143		2,521		–		2,664
Loans not graded(2)		55,165		5,462		–		60,627		58,565		7,680		–		66,245
Default		–		–		2,040		2,040		–		–		2,164		2,164
Total	$	561,443	$	18,577	$	2,040	$	582,060	$	519,888	$	30,138	$	2,164	$	552,190
Allowance for credit losses		1,242		1,911		959		4,112		1,148		2,206		1,000		4,354
Carrying value	$	560,201	$	16,666	$	1,081	$	577,948	$	518,740	$	27,932	$	1,164	$	547,836

(1) Stage 3 includes purchased or originated credit impaired loans.

(2) Portfolios where the customer account level ‘Probability of Default’ has not been determined have been included in the ‘Loans not graded’ category.

Business and government loans	As at April 30, 2022								As at October 31, 2021
Grade ($ millions)	Stage 1		Stage 2		Stage 3(1)		Total		Stage 1		Stage 2		Stage 3(1)		Total
Investment grade	$	133,757	$	714	$	–	$	134,471	$	110,786	$	892	$	–	$	111,678
Non-investment grade		98,055		9,453		–		107,508		91,945		7,570		–		99,515
Watch list		24		2,742		–		2,766		31		3,266		–		3,297
Loans not graded(2)		2,243		11		–		2,254		2,151		11		–		2,162
Default		–		–		2,224		2,224		–		–		2,292		2,292
Total	$	234,079	$	12,920	$	2,224	$	249,223	$	204,913	$	11,739	$	2,292	$	218,944
Allowance for credit losses		202		335		645		1,182		186		431		655		1,272
Carrying value	$	233,877	$	12,585	$	1,579	$	248,041	$	204,727	$	11,308	$	1,637	$	217,672

(1) Stage 3 includes purchased or originated credit-impaired loans.

(2) Portfolios where the customer account level ‘Probability of Default’ has not been determined have been included in the ‘Loans not graded’ category.

Undrawn loan commitments – Business and government	As at April 30, 2022								As at October 31, 2021
Grade ($ millions)	Stage 1		Stage 2		Stage 3(1)		Total		Stage 1		Stage 2		Stage 3(1)		Total
Investment grade	$	197,941	$	1,434	$	–	$	199,375	$	186,056	$	1,266	$	–	$	187,322
Non-investment grade		61,413		4,183		–		65,596		66,009		3,786		–		69,795
Watch list		1		1,174		–		1,175		12		2,160		–		2,172
Loans not graded(2)		4,082		–		–		4,082		4,155		–		–		4,155
Default		–		–		118		118		–		–		102		102
Total	$	263,437	$	6,791	$	118	$	270,346	$	256,232	$	7,212	$	102	$	263,546
Allowance for credit losses		32		17		–		49		26		39		–		65
Carrying value	$	263,405	$	6,774	$	118	$	270,297	$	256,206	$	7,173	$	102	$	263,481

(1) Stage 3 includes purchased or originated credit-impaired loans.

(2) Portfolios where the customer account level ‘Probability of Default’ has not been determined have been included in the ‘Loans not graded’ category.

Total non-retail loans	As at April 30, 2022								As at October 31, 2021
Grade ($ millions)	Stage 1		Stage 2		Stage 3(1)		Total		Stage 1		Stage 2		Stage 3(1)		Total
Investment grade	$	331,698	$	2,148	$	–	$	333,846	$	296,842	$	2,158	$	–	$	299,000
Non-investment grade		159,468		13,636		–		173,104		157,954		11,356		–		169,310
Watch list		25		3,916		–		3,941		43		5,426		–		5,469
Loans not graded(2)		6,325		11		–		6,336		6,306		11		–		6,317
Default		–		–		2,342		2,342		–		–		2,394		2,394
Total	$	497,516	$	19,711	$	2,342	$	519,569	$	461,145	$	18,951	$	2,394	$	482,490
Allowance for credit losses		234		352		645		1,231		212		470		655		1,337
Carrying value	$	497,282	$	19,359	$	1,697	$	518,338	$	460,933	$	18,481	$	1,739	$	481,153

(1) Stage 3 includes purchased or originated credit-impaired loans.

(2) Portfolios where the customer account level ‘Probability of Default’ has not been determined have been included in the ‘Loans not graded’ category.

Schedule of Loans Past Due But Not Impaired

	As at April 30, 2022(2)
($ millions)	31-60 days		61-90 days		91 days and greater(3)		Total
Residential mortgages	$	797	$	360	$	–	$	1,157
Personal loans		387		218		–		605
Credit cards		133		91		184		408
Business and government		111		87		–		198
Total	$	1,428	$	756	$	184	$	2,368
	As at January 31, 2022(2)
($ millions)	31-60 days		61-90 days		91 days and greater(3)		Total
Residential mortgages	$	791	$	386	$	–	$	1,177
Personal loans		424		226		–		650
Credit cards		130		84		184		398
Business and government		71		30		–		101
Total	$	1,416	$	726	$	184	$	2,326
	As at October 31, 2021(2)
($ millions)	31-60 days		61-90 days		91 days and greater(3)		Total
Residential mortgages	$	732	$	327	$	–	$	1,059
Personal loans		411		210		–		621
Credit cards		125		83		201		409
Business and government		124		24		–		148
Total	$	1,392	$	644	$	201	$	2,237

(1) Loans past due 30 days or less are not presented in this analysis as they are not administratively considered past due.

(2) For loans where payment deferrals were granted, deferred payments are not considered past due and such loans are not aged further during the deferral period. Regular ageing of the loans resumes, after the end of the deferral period.

(3) All loans that are over 90 days past due are considered impaired with the exception of credit card receivables which are considered impaired when 180 days past due.

Summary of Purchased Credit Impaired Loans

(f) Purchased credit-impaired loans

Certain financial assets including loans are credit-impaired on initial recognition. The following table provides details of such assets:

	As at
($ millions)	April 30 2022			January 31 2022			October 31 2021
Unpaid principal balance(1)	$	308		$	310		$	303
Credit related fair value adjustments		(69	)		(69	)		(68	)
Carrying value		239			241			235
Stage 3 allowance		(1	)		(1	)		(1	)
Carrying value net related allowance	$	238		$	240		$	234

(1) Represents principal amount owed net of write-offs.