The following is excerpted from the question-and-answer section of the transcript.
(Questions from industry analysts are provided in full, but answers are omitted - download the transcript to see the full question-and-answer session)
Question: Gabriel Dechaine - National Bank Financial, Inc., Research Division - Analyst
: I just have a question on the deposit substitution effect. It sounds like you're seeing it more in the international segment, switching from 0 cost to
term deposits. Is there any chance we start to see that in a more accelerated fashion in Canada? And then just a quick one on the client activity
comment in GBM. I get that characterization. I'm just wondering if you can put some -- maybe frame it with your numbers. And more importantly,
are you starting to see that reverse in the current quarter?
Question: Gabriel Dechaine - National Bank Financial, Inc., Research Division - Analyst
: Yes. I was thinking more -- the ECM, DCM activity we've all seen, I was thinking more along the lines of whether it's prime brokerage or some of the
other business lines we don't see as clearly and declines in margin loans, stuff like that, but I guess it's probably along the same lines.
Question: Sohrab Movahedi - BMO Capital Markets Equity Research - Analyst
: Wanted to just go to Dan. Dan, your segment has had double-digit pretax pre-provision growth for a number of quarters now. I don't want to say
is this as good as it gets, but what's your outlook here for your pretax pre-provision? And the flip side of the question, I guess, a broader question
for Brian.
The International segment is back for second quarter in a row now of $600 million plus in earnings. But I think it's still only around 25% of the total
bank when you have depressed kind of GBM results resilient wealth results, but presumably GBM and wealth will kind of rebound, trying to kind
of get a feel for how much of the total bank is international going to be once you have some, I'll call it, a mean reversion in some of the other
segments, keeping in mind that probably Canadian Banking is going to moderate frontier or that compounds (inaudible) depending on how Dan
answers the question, I suppose.
Question: Sohrab Movahedi - BMO Capital Markets Equity Research - Analyst
: Okay. I appreciate it. Can I just do one quick follow-up with Dan? And if push came to shove, what sort of -- where can you get operating leverage?
Do you have room on your expenses? Or if revenue growth slowed down could be the case with negative operating leverage?
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