Company Announcements

Equitable Reports Record Q2 Earnings, Digital Growth, Proposed Stock Split

Canada's Challenger Bank™ Matches Ambitious Growth Targets with Strong Execution

TORONTO, July 28, 2021 /CNW/ - Equitable Group Inc. (TSX: EQB) (TSX: EQB.PR.C) ("Equitable" or the "Bank") today reported record earnings for the three and six months ended June 30, 2021, as Equitable Bank (Canada's Challenger Bank™) continued to deliver on its ambitious annual growth targets while investing in the expansion of its services and technology to drive change that enriches the lives of Canadians. 

Q2 Net Earnings $70.8 million, +$18.3 million or +35% from 2020

  • Q2 diluted EPS $4.05, +33% from Q2 2020

ROE 16.5% with $100 million in Excess Capital

  • Q2 ROE towards high end of 15-17% target, and 1.8% better than 14.7% in Q2 2020
  • CET1 14.4% vs. mid-point target of 13.5%, or excess capital of nearly $6 per share
  • Efficiency remaining in target range of 39-41% at 40.9% in Q2 and 39.6% YTD

Book Value Surpasses $100 per share

  • Book value +20% y/y to $101.94 per share and +$4.08 or +4% from Q1 2021

Customers and Digital – Growing & Deepening

  • Now serving nearly 300,000 Canadians, with EQ Bank digital customers +79% y/y to 222,000 and deposits +99% y/y to over $6.5 billion
  • Digital transactions +101% y/y, average products per customer +44%, customer lifetime value more than 10 times higher than account acquisition costs

Conventional Lending Driving Asset Growth

  • Loans under management +9% y/y to $35.4 billion
  • Single family alternative loan originations +200% y/y to $1.8 billion, reverse mortgage originations +318% y/y to $45 million, and Commercial loan originations +16% y/y to $0.7 billion

"Earlier this year, we significantly upgraded our growth forecast and in so doing, challenged ourselves to do more for customers, partners, and shareholders. Through Q2, Equitable delivered to this guidance. On the strength of great execution by our team and meaningful innovations in our challenger bank services, each area of the Bank registered growth. EQ Bank deposits grew 99% over 2020 to a record $6.5 billion, an indication that digital services like our new US Dollar Account are driving the kind of change that enriches the lives of our customers. This past quarter was also an excellent illustration of how we're positioning to drive future earnings, with double-digit loan origination growth reflecting strong contributions from alternative single family, reverse mortgages, Cash Surrender Value lines of credit and conventional commercial loans where Equitable stands out for responsive service, effective underwriting, and risk management. For shareholders, Q2 featured record earnings, high ROE, and an industry best efficiency ratio, even as we purposely drive higher investment to seed future growth. With the tailwinds of an improving economy and the positive impact of service expansions, Equitable is in a great position to realize its objectives this year and beyond, on behalf of almost 300,000 customers, our valued shareholders, and business partners," said Andrew Moor, President and Chief Executive Officer.

Record Results Put Equitable on Pace to Achieve Ambitious 2021 Outlook

  • Equitable raised its outlook for 2021 in May and based on growth trends in Q2 and through the first half of the year, the Bank is running on or ahead of that guidance.
  • EQ Bank deposit growth of 43% or $2.0 billion since December 31, 2020 compares to full year targeted growth of 30-50%.
  • Total loan growth of 8% year over year and 6% or $1.6 billion since December 31, 2020 compares to full year targeted growth of 8-12%.
  • Conventional Commercial and Personal loan growth positively impacted earnings in Q2 and is expected to create additional momentum for earnings growth in 2022.

EQ Bank Now Serves approximately 222,000 Canadians, Deposits Exceed $6.5 Billion

  • EQ Bank deposits increased 99% year over year to over $6.5 billion at June 30, 2021, reflecting customer growth and the growing popularity of services including the recently launched EQ Bank US Dollar Account and Mortgage Marketplace.
  • EQ Bank term deposits increased 267% year over year and 191% during the second quarter.
  • Transactions on the platform increased 101% over Q2 last year, while products per customer grew 44%, both indications of strong and growing customer engagement.

New EQ Bank US Dollar Account Expands Challenger Bank Services  

  • In June, EQ Bank added a US Dollar Account to its ever-expanding suite of smarter digital banking products, making it simpler, faster, and more economic to purchase, hold and transfer US dollars internationally with complete digital account opening and usage, that eliminates monthly fees and paperwork. This account offers a very competitive U.S. and Canadian currency exchange rate that also adds fee-based revenue for Equitable.
  • The same interest rate is available on the recently introduced Equitable Bank U.S. High Interest Savings Account. The introduction of these new US dollar products is based on the Bank's recognition that Canadians need smarter options to more easily grow their US funds and the opportunity created by the recent extension of CDIC coverage to foreign currency accounts.
  • During the quarter, EQ Bank added more currencies to its innovative and cost-effective international money transfer service, bringing the total to 45 currencies at the end of Q2.

Equitable Bank Receives CMHC Approval to Launch $2 Billion Covered Bond Program

  • Subsequent to quarter end, the Bank was very pleased to announce that CMHC approved Equitable's $2 billion legislative covered bond program, which will contribute to lower cost of funds and become an important part of the Bank's funding diversification plan.
  • The first issuance of approximately €250-€300 million is expected early this fall. Equitable's covered bonds will be senior, unsecured and unconditional obligations of Equitable Bank and will rank pari passu in right of payment with all of the Bank's deposit liabilities.

Total Deposits Top $18.4 Billion on Diversified Customer and Channel Growth  

  • Equitable Bank's total deposits were up 18% year over year to $18.4 billion from $15.6 billion a year ago, and up 6% within the second quarter.
  • Equitable Bank's Deposit Note Program reached $1.05 billion during the quarter – 197% higher than a year ago – with the successful offering of an additional $150 million principal amount of 1.774% fixed rate notes maturing September 21, 2023, priced at 90 basis points over the interpolated Government of Canada curve (representing the lowest ever spread with a re-opening yield of 1.384%). The offering was approximately four times oversubscribed, reflecting the Bank's strong credit performance.

Loans Under Management Reach $35.4 Billion with Strong Growth in Alternative Single Family and Conventional Commercial

  • Loans Under Management increased 9% since Q2 2020 or $3.0 billion – driven by growth in all Personal and Commercial segment business lines – and grew 4%, or $1.2 billion, in Q2 2021 alone.
  • Loan principal for the Personal Bank grew 6% year over year to $20.1 billion on origination growth of 34% or $569 million, while Commercial loan principal increased 12% to $9.7 billion with originations up 46% or $431 million.
  • Alternative single family mortgage principal, a key driver of the Bank's Personal segment earnings, generated record originations of $1.8 billion in Q2, three times higher than the average a year ago, with assets now totaling $12.1 billion (2021 growth target 12-15%).
  • Growth in the Commercial Bank's portfolio included a 14% year over year increase in Commercial Finance Group loans (full-year target 20-25%), a 9% increase in Business Enterprise Solutions (full-year target 7-10%), a 9% increase in Multi-unit Insured (full-year target a slight decline), a 31% increase in Specialized Finance (full-year target 20-25%) and a 24% increase in Equipment Leasing (full-year target 5-8%).
  • Assets under management reached a record $37.9 billion, up 9% over the past 12-months (and 3% from Q1 2021) reflecting broad-based growth.

Wealth Decumulation Book Reaches $165 Million, On Track to 2021 200%+ Target

  • Equitable Bank's Wealth Decumulation business increased assets by more than two-fold year over year to $165 million.
  • Reverse mortgage loans increased 273% year over year (full-year growth target 200%+) to $127 million due to expanded market share and differentiated product terms and features that appeal to a larger audience of Canadian mortgage advisors and clients.
  • CSV loans increased 180% year over year (full-year target 150%+) while distribution continues to increase to include new lending arrangements finalized with Sun Life and Manulife and, subsequent to quarter end, a partnership with Desjardins Insurance whereby qualifying policyholders can access Equitable Bank's market-leading product.

Credit Metrics Reflect Long-Term Prudence, Q2 Reserve Release $5.3 Million

  • Reserve releases amounted to $5.3 million in Q2 (or $0.23 per share), reflecting an improvement in macroeconomic forecasts used for loss modelling and the large provision for credit losses (PCL) taken a year ago.
  • PCL was a net benefit of $2.0 million in Q2 2021 (Q1 2021 – $0.8 million), as future expected losses accrued in 2020 were recorded in Q1 and Q2 2020.
  • Net impaired loans declined to 0.41% of total loan assets at June 30, 2021 compared to 0.54% a year ago reflecting a reduction of $29.0 million year over year. At June 30, 2021, net impaired loans were higher than 0.36% in Q1 2021 because of the addition of two commercial loans – $23.1 million in Alberta which was fully repaid in July 2021 and $8.9 million in Manitoba – and despite net reductions in impaired single family mortgages and equipment leases. The loan in Manitoba has an LTV of 59% and no loss is expected.
  • Equitable remains well reserved for credit losses with allowances as a percentage of total loan assets equaling 19 bps at June 30, 2021 reflecting a decrease in allowances in stage 2 and 3 over last year.
  • Stage 3 allowances dropped by $2.9 million year over year and $0.8 million since Q1 2021.
  • Realized losses remained low at $4.1 million or 6 basis points relative to total loan assets.

Strong Capital and Liquidity Combined with Positive Credit Rating 

  • Liquid assets were $2.9 billion or 9.1% of total assets at June 30, 2021, compared to $1.9 billion or 6.4% a year ago, a level that is sufficient for the Bank to meet its upcoming obligations even in the unlikely event of further pandemic disruptions in financial markets. Retail and securitization funding markets remain liquid and efficient.
  • In a report published on May 26, 2021, Fitch Ratings assigned long-term and short-term ratings of 'BBB-'/'F3' respectively to Equitable Bank, with a stable outlook and noted the Bank's capital ratios are higher than many larger bank peers.

ESG – Meaningful Progress in Scope 3 Measurement and Diversity Goals

  • Following completion of Scope 1 and 2 greenhouse gas ("GHG") emissions inventory, the Bank quantified emissions from all Scope 3 categories in Q2, including financed emissions.
  • The Scope 3 GHG emissions were quantified using calculation approaches and methodologies from the GHG Protocol and the Partnership for Carbon Accounting Financials (PCAF), and supported by external partner WSP Canada.
  • Equitable looks forward to disclosing targets and progress on climate risk and diversity initiatives in our Environmental, Social and Governance annual report next year.

Proposed Two-for-One Stock Split Reflects Growing Market Recognition of Value  

  • Equitable plans to implement a two-for-one split of issued and outstanding common stock to make ownership more accessible for investors. It intends to use the push-out method whereby shareholders receive additional or replacement security certificates.
  • This proposal has been approved by Equitable's Board of Directors and is subject to shareholder and regulatory approval.
  • Further details on the proposal and key dates for shareholders will be included in the special shareholder meeting announcement in August 2021.

Board of Directors Declares Dividends for Third Quarter 2021

  • A dividend of $0.37 per common share will be paid on September 30, 2021 to common shareholders of record at the close of business September 15, 2021.
  • A dividend of $0.373063 per preferred share will be paid on September 30, 2021 to preferred shareholders of record at the close of business on September 15, 2021.
  • The dividend rate was unchanged from 2020 reflecting regulatory guidance from OSFI to all federally regulated banks. The Bank intends to resume its previously announced dividend increases once regulatory restrictions are lifted.

"As a leading digital bank, Equitable is challenging not just to enrich lives today or next quarter but for the long term and we are guided accordingly as we plan and invest in our people, technology, customer service innovations and business partnerships," said Mr. Moor. "In that context, the remaining months of 2021 will feature growth that we expect will hit our targets for the year, but also platform expansions that will set us up for another strong year in 2022."

Analyst Conference Call and Webcast: 8:30 a.m. Eastern Thursday, July 29, 2021

Equitable's Andrew Moor, President and Chief Executive Officer, Chadwick Westlake, Chief Financial Officer, and Ron Tratch, Chief Risk Officer will host the second quarter conference call and webcast.  To access the call live, please dial (416) 764-8609 five minutes prior to the start time.  The listen-only webcast with accompanying slides will be available at eqbank.investorroom.com/events-webcasts.

Call Archive
A replay of the call will be available until August 5, 2021 at midnight at (416) 764-8677 (passcode 015442 followed by the number sign). Alternatively, the webcast will be archived on the Bank's website.

INTERIM CONSOLIDATED FINANCIAL STATEMENTS





Consolidated balance sheets  (unaudited)





($000s) As at

June 30, 2021

December 31, 2020

June 30, 2020

Assets:




Cash and cash equivalents

591,752

557,743

569,688

Restricted cash

507,295

504,039

589,046

Securities purchased under reverse repurchase agreements

100,015

450,203

200,370

Investments

859,925

589,876

566,859

Loans – Personal

20,225,222

19,445,386

19,135,799

Loans – Commercial

9,667,652

8,826,182

8,573,118

Securitization retained interests

203,491

184,844

149,307

Other assets

186,901

188,045

173,059


32,342,253

30,746,318

29,957,246

Liabilities and Shareholders' Equity




Liabilities:




   Deposits

18,588,223

16,585,043

15,861,725

   Securitization liabilities

11,483,635

11,991,964

11,190,224

   Obligations under repurchase agreements

201,271

251,877

598,956

   Deferred tax liabilities

67,520

60,880

50,546

   Other liabilities

200,067

208,852

256,038

   Funding facilities

-

-

500,374


30,540,716

29,098,616

28,457,863

Shareholders' equity:




   Preferred shares

72,001

72,477

72,557

   Common shares

224,997

218,166

213,701

   Contributed surplus

8,237

8,092

7,818

   Retained earnings

1,513,118

1,387,919

1,257,268

   Accumulated other comprehensive loss

(16,816)

(38,952)

(51,961)


1,801,537

1,647,702

1,499,383


32,342,253

30,746,318

29,957,246

 

Consolidated statements of income (unaudited)




($000s, except per share amounts)

Three months ended

Six months ended


June 30, 2021

June 30, 2020

June 30, 2021

June 30, 2020

Interest income:





Loans – Personal

164,363

172,019

325,420

353,576

Loans – Commercial

103,169

98,974

204,427

199,180

Investments

3,824

3,315

6,723

5,803

Other

2,606

3,220

5,226

9,167


273,962

277,528

541,796

567,726

Interest expense:





Deposits

76,693

94,022

154,478

195,842

Securitization liabilities

55,278

63,302

111,170

130,323

Funding facilities

152

1,497

343

2,703


132,123

158,821

265,991

328,868

Net interest income

141,839

118,707

275,805

238,858

Non-interest income:





Fees and other income

5,598

5,130

11,173

11,853

Net gain on loans and investments

4,907

8,653

3,446

122

Gains (losses) on securitization activities and income from
securitization retained interests

6,430

(1,160)

18,520

5,342


16,935

12,623

33,139

17,317

Revenue

158,774

131,330

308,944

256,175

Provision for credit losses

(1,982)

8,847

(2,754)

44,534

Revenue after provision for credit losses

160,756

122,483

311,698

211,641

Non-interest expenses:





Compensation and benefits

32,396

26,253

61,369

53,148

Other

32,594

25,214

60,938

52,499


64,990

51,467

122,307

105,647

Income before income taxes

95,766

71,016

189,391

105,994

Income taxes:





Current

20,698

16,106

42,740

31,686

Deferred

4,267

2,428

6,656

(4,144)


24,965

18,534

49,396

27,542

Net income

70,801

52,482

139,995

78,452

Dividends on preferred shares

1,111

1,119

2,225

2,238

Net income available to common shareholders

69,690

51,363

137,770

76,214






Earnings per share:





Basic

4.11

3.06

8.13

4.54

Diluted

4.05

3.05

8.02

4.50

 

Consolidated statements of comprehensive income (unaudited)




($000s)

Three months ended

Six months ended


June 30, 2021

June 30, 2020

June 30, 2021

June 30, 2020

Net income

70,801

52,482

139,995

78,452

Other comprehensive income – items that will be
reclassified subsequently to income:





Debt instruments at Fair Value through Other
Comprehensive Income:





Net unrealized (losses) gains from change in fair
value

(1,570)

3,899

(3,228)

3,074

Reclassification of net losses (gains) to income

178

(351)

1,317

(1,019)

Other comprehensive income – items that will not be
reclassified subsequently to income:





Equity instruments designated at Fair Value through
Other Comprehensive Income:





Net unrealized gains (losses) from change in fair
value

6,374

6,239

16,102

(16,669)


4,982

9,787

14,191

(14,614)

Income tax (expense) recovery

(1,307)

(2,586)

(3,725)

3,861


3,675

7,201

10,466

(10,753)

Cash flow hedges:





Net unrealized gains (losses) from change in fair
value

2,155

(5,293)

16,065

(33,354)

Reclassification of net losses (gains) to income

231

(245)

(234)

2,610


2,386

(5,538)

15,831

(30,744)

Income tax (expense) recovery

(628)

1,463

(4,161)

8,122


1,758

(4,075)

11,670

(22,622)

Total other comprehensive income (loss)

5,433

3,126

22,136

(33,375)

Total comprehensive income

76,234

55,608

162,131

45,077

 

Consolidated statements of changes in shareholders' equity  (unaudited )


($000s) Three month period ended

June 30, 2021


Preferred
Shares

Common
Shares

Contributed
Surplus

Retained
Earnings

Accumulated other
comprehensive income (loss)


Cash Flow
Hedges

Financial
Instruments at
FVOCI

Total

Total

Balance, beginning of period

72,194

224,397

7,722

1,449,715

(10,031)

(12,218)

(22,249)

1,731,779

Net Income

-

-

-

70,801

-

-

-

70,801

Other comprehensive income, net of tax

-

-

-

-

1,758

3,675

5,433

5,433

Exercise of stock options

-

489

-

-

-

-

-

489

Purchase of treasury preferred shares

(193)

-

-

-

-

-

-

(193)

Net loss on cancellation of treasury
preferred
shares

-

-

-

(10)

-

-

-

(10)

Dividends:









Preferred shares

-

-

-

(1,111)

-

-

-

(1,111)

Common shares

-

-

-

(6,277)

-

-

-

(6,277)

Stock-based compensation

-

-

626

-

-

-

-

626

Transfer relating to the exercise of stock
options

-

111

(111)

-

-

-

-

-

Balance, end of period

72,001

224,997

8,237

1,513,118

(8,273)

(8,543)

(16,816)

1,801,537

($000s) 

June 30, 2020

Balance, beginning of period

72,557

213,701

7,405

1,212,125

(18,306)

(36,781)

(55,087)

1,450,701

Net Income

-

-

-

52,482

-

-

-

52,482

Other comprehensive loss, net of tax

-

-

-

-

(4,075)

7,201

3,126

3,126

Dividends:









Preferred shares

-

-

-

(1,119)

-

-

-

(1,119)

Common shares

-

-

-

(6,220)

-

-

-

(6,220)

Stock-based compensation

-

-

413

-

-

-

-

413

Balance, end of period

72,557

213,701

7,818

1,257,268

(22,381)

(29,580)

(51,961)

1,499,383

 

Consolidated statements of changes in shareholders' equity (unaudited)


($000s) Six month period ended

June 30, 2021


Preferred
Shares

Common
Shares

Contributed
Surplus

Retained
Earnings

Accumulated other 
comprehensive income (loss)


Cash Flow
Hedges

Financial
Instruments at
FVOCI

Total

Total

Balance, beginning of period

72,477

218,166

8,092

1,387,919

(19,943)

(19,009)

(38,952)

1,647,702

Net Income

-

-

-

139,995

-

-

-

139,995

Other comprehensive income, net of tax

-

-

-

-

11,670

10,466

22,136

22,136

Exercise of stock options

-

5,715

-

-

-

-

-

5,715

Purchase of treasury preferred shares

(476)

-

-

-

-

-

-

(476)

Net loss on cancellation of treasury
preferred
shares

-

-

-

(20)

-

-

-

(20)

Dividends:









Preferred shares

-

-

-

(2,225)

-

-

-

(2,225)

Common shares

-

-

-

(12,551)

-

-

-

(12,551)

Stock-based compensation

-

-

1,261

-

-

-

-

1,261

Transfer relating to the exercise of stock
options

-

1,116

(1,116)

-

-

-

-

-

Balance, end of period

72,001

224,997

8,237

1,513,118

(8,273)

(8,543)

(16,816)

1,801,537

($000s)

June 30, 2020

Balance, beginning of period

72,557

213,277

6,973

1,193,493

241

(18,827)

(18,586)

1,467,714

Net Income

-

-

-

78,452

-

-

-

78,452

Other comprehensive loss, net of tax

-

-

-

-

(22,622)

(10,753)

(33,375)

(33,375)

Exercise of stock options

-

357

-

-

-

-

-

357

Dividends:









Preferred shares

-

-

-

(2,238)

-

-

-

(2,238)

Common shares

-

-

-

(12,439)

-

-

-

(12,439)

Stock-based compensation

-

-

912

-

-

-

-

912

Transfer relating to the exercise of stock
options

-

67

(67)

-

-

-

-

-

Balance, end of period

72,557

213,701

7,818

1,257,268

(22,381)

(29,580)

(51,961)

1,499,383

 

Consolidated statements of cash flows  (unaudited)




($000s) 

Three months ended

Six months ended

Three and six month periods ended

June 30, 2021

June 30, 2020

June 30, 2021

June 30, 2020

CASH FLOWS FROM OPERATING ACTIVITIES





Net income

70,801

52,482

139,995

78,452

Adjustments for non-cash items in net income:





Financial instruments at fair value through income

1,778

982

(5,612)

14,344

Amortization of premiums/discount on investments

28

1,148

46

1,457

Amortization of capital assets and intangible costs

7,897

5,504

15,234

10,735

Provision for credit losses

(1,982)

8,847

(2,754)

44,534

Securitization gains

(8,177)

(2,516)

(12,355)

(5,283)

Stock-based compensation

626

413

1261

912

Income taxes

24,965

18,534

49,396

27,542

Securitization retained interests

11,221

518

21,900

8,998

Changes in operating assets and liabilities:





Restricted cash

25,398

(198,648)

(3,256)

(126,054)

Securities purchased under reverse repurchase agreements

250,022

299,594

350,188

(50,303)

Loans receivable, net of securitizations

(1,025,059)

(939,714)

(1,672,166)

(1,145,281)

Other assets

(709)

(1,520)

5,198

(3,990)

Deposits

980,721

168,440

2,008,887

404,314

Securitization liabilities

(247,738)

412,120

(508,067)

478,239

Obligations under repurchase agreements

201,271

169,609

(50,606)

91,912

Funding facilities

-

386

-

500,374

Other liabilities

(23,931)

(8,057)

11,647

13,803

   Income taxes paid

(15,306)

(420)

(32,531)

(37,919)

Cash flows from (used in) operating activities

251,826

(12,298)

316,405

306,786

CASH FLOWS FROM FINANCING ACTIVITIES





Proceeds from issuance of common shares

489

-

5,715

357

Dividends paid on preferred shares

(1,111)

(1,119)

(2,225)

(2,238)

Dividends paid on common shares

(6,277)

(6,220)

(12,551)

(12,439)

Cash flows used in financing activities

(6,899)

(7,339)

(9,061)

(14,320)

CASH FLOWS FROM INVESTING ACTIVITIES





Purchase of investments

(453,543)

(153,815)

(484,850)

(269,777)

Proceeds on sale or redemption of investments

213,111

50,045

229,466

112,226

Net change in Canada Housing Trust re-investment accounts

336

(36,997)

(89)

(60,667)

Purchase of capital assets and system development costs

(9,346)

(7,243)

(17,862)

(13,413)

Cash flows used in investing activities

(249,442)

(148,010)

(273,335)

(231,631)

Net (decrease) increase in cash and cash equivalents

(4,515)

(167,647)

34,009

60,835

Cash and cash equivalents, beginning of period

596,267

737,335

557,743

508,853

Cash and cash equivalents, end of period

591,752

569,688

591,752

569,688

Cash flows from operating activities include:





Interest received

250,337

275,050

508,152

555,359

Interest paid

(134,229)

(150,628)

(274,186)

(293,723)

Dividends received

1,434

1,522

2,916

3,076

About Equitable

Equitable Group Inc. trades on the Toronto Stock Exchange (TSX: EQB and EQB.PR.C) and serves nearly three hundred thousand Canadians through Equitable Bank, Canada's Challenger Bank™. Equitable Bank has grown to become the country's eighth largest independent Schedule I bank with a clear mandate to drive real change in Canadian banking to enrich people's lives.  Founded over 50 years ago, Equitable Bank provides diversified personal and commercial banking and through its EQ Bank platform (eqbank.ca) has been named #1 Bank in Canada on the Forbes World's Best Banks 2021 list.  Please visit equitablebank.ca for details.

Cautionary Note Regarding Forward-Looking Statements

Statements made by the Bank in the sections of this news release, in other filings with Canadian securities regulators and in other communications include forward-looking statements within the meaning of applicable securities laws (forward-looking statements).  These statements include, but are not limited to, statements about the Bank's objectives, strategies and initiatives, financial performance expectations and other statements made herein, whether with respect to the Bank's businesses or the Canadian economy.  Generally, forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "planned", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases which state that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved", or other similar expressions of future or conditional verbs.  Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, closing of transactions, performance or achievements of the Bank to be materially different from those expressed or implied by such forward-looking statements, including but not limited to risks related to capital markets and additional funding requirements, fluctuating interest rates and general economic conditions, legislative and regulatory developments, changes in accounting standards, the nature of our customers and rates of default, and competition as well as those factors discussed under the heading "Risk Management" in the MD&A and in the Bank's documents filed on SEDAR at www.sedar.com.  All material assumptions used in making forward-looking statements are based on management's knowledge of current business conditions and expectations of future business conditions and trends, including their knowledge of the current credit, interest rate and liquidity conditions affecting the Bank and the Canadian economy.  Although the Bank believes the assumptions used to make such statements are reasonable at this time and has attempted to identify in its continuous disclosure documents important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended.  Certain material assumptions are applied by the Bank in making forward-looking statements, including without limitation, assumptions regarding its continued ability to fund its mortgage business, a continuation of the current level of economic uncertainty that affects real estate market conditions, continued acceptance of its products in the marketplace, as well as no material changes in its operating cost structure and the current tax regime.  There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements.  Accordingly, readers should not place undue reliance on forward-looking statements.  The Bank does not undertake to update any forward-looking statements that are contained herein, except in accordance with applicable securities laws.

Non-Generally Accepted Accounting Principles ("GAAP") Financial Measures

This news release references certain non-GAAP measures such as Return on equity, Book value per common share, Loans under management, Efficiency ratio, CET1 Capital Ratio, Assets under management, Liquid assets, and Liquidity Coverage Ratio that management believes provide useful information to investors regarding the Bank's financial condition and results of operations. The "NON-GENERALLY ACCEPTED ACCOUNTING PRINCIPLES ("GAAP") FINANCIAL MEASURES" section of the Bank's Q2 2021 MD&A provides a detailed description of each non-GAAP measure and should be read in conjunction with this release. The MD&A also provides a reconciliation between all non-GAAP measures and the most directly comparable GAAP measure, where applicable.  Readers are cautioned that non-GAAP measures often do not have any standardized meaning, and therefore, may not be comparable to similar measures presented by other companies.

SOURCE Equitable Group Inc.

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