Investor Presentation

THIRD QUARTER 2016

2

Disclaimer and Caution Regarding Forward‐Looking StatementsDisclaimer

This presentation is only for wholesale investors and represents information of a public nature. It does not constitute an invitation, offer, solicitation or inducement to buy or sell any securities of The Bank of Nova Scotia in any jurisdiction. This presentation does not constitute investment advice or any form of recommendation, and should not be construed as such.

Caution Regarding Forward-Looking Statements

Our public communications often include oral or written forward-looking statements. Statements of this type are included in this document, and may be included in other filings with Canadian securities regulators or the U.S. Securities and Exchange Commission, or in other communications. All such statements are made pursuant to the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995 and any applicable Canadian securities legislation. Forward-looking statements may include, but are not limited to, statements made in this document, the Management’s Discussion and Analysis in the Bank’s 2015 Annual Report under the headings “Overview-Outlook,” for Group Financial Performance “Outlook,” for each business segment “Outlook” and in other statements regarding the Bank’s objectives, strategies to achieve those objectives, the regulatory environment in which the Bank operates, anticipated financial results (including those in the area of risk management), and the outlook for the Bank’s businesses and for the Canadian, U.S. and global economies. Such statements are typically identified by words or phrases such as “believe,” “expect,” “anticipate,” “intent,” “estimate,” “plan,” “may increase,” “may fluctuate,” and similar expressions of future or conditional verbs, such as“will,” “may,” “should,” “would” and “could.”By their very nature, forward-looking statements involve numerous assumptions, inherent risks and uncertainties, both general and specific, and the risk that predictions and other forward-looking statements will not prove to be accurate. Do not unduly rely on forward-looking statements, as a number of important factors, many of which are beyond the Bank’s control and the effects of which can be difficult to predict, could cause actual results to differ materially from the estimates and intentions expressed in such forward-looking statements. These factors include, but are not limited to: the economic and financial conditions in Canada and globally; fluctuations in interest rates and currency values; liquidity and funding; significant marketvolatility and interruptions; the failure of third parties to comply with their obligations to the Bank and its affiliates; changes in monetary policy; legislative and regulatory developments in Canada and elsewhere, including changes to, and interpretations of tax laws and risk-based capital guidelines and reporting instructions and liquidity regulatory guidance; changes to the Bank’s credit ratings; operational (including technology) and infrastructure risks; reputational risks; the risk that the Bank’s risk management models may not take into account all relevant factors; the accuracy and completeness of information the Bank receives on customers and counterparties; the timely development and introduction of new products and services in receptive markets; the Bank’s ability to expand existing distribution channels and to develop and realize revenues from new distribution channels; the Bank’s ability to complete and integrate acquisitions and its other growth strategies; critical accounting estimates and the effects of changes in accounting policies and methods used bythe Bank (See “Controls and Accounting Policies—Critical accounting estimates” in the Bank’s 2015 Annual Report, as updated by this document); global capital markets activity; the Bank’s ability to attract and retain key executives; reliance on third parties to provide components of the Bank’s business infrastructure; unexpected changes in consumer spending and saving habits; technological developments; fraud by internal or external parties, including the use of new technologies in unprecedented ways to defraud the Bank or its customers; increasing cyber security risks which may include theft of assets, unauthorized access to sensitive information or operational disruption; consolidation in the Canadian financial services sector; competition, both from new entrants and established competitors; judicial and regulatory proceedings; natural disasters, including, but not limited to, earthquakes and hurricanes, and disruptions to public infrastructure, such as transportation, communication, power or water supply; the possible impact of international conflicts and other developments, including terrorist activities and war; the effects of disease or illness on local, national or international economies; and the Bank’s anticipation of and success in managing the risks implied by the foregoing. A substantial amount of the Bank’s business involves making loans or otherwise committing resources to specific companies, industries or countries. Unforeseen events affecting such borrowers, industries or countries could have a material adverse effect on the Bank’s financial results, businesses, financial condition or liquidity. These and other factors may cause the Bank’s actual performance to differ materially from that contemplated by forward-looking statements. For more information, see the “Risk Management” section starting on page 66 of the Bank’s 2015 Annual Report.Material economic assumptions underlying the forward-looking statements contained in this document are set out in the 2015 Annual Report under the heading “Overview-Outlook,” as updated by this document; and for each business segment “Outlook”. The “Outlook” sections are based on the Bank’s views and the actual outcome is uncertain. Readers should consider the above-noted factors when reviewing these sections. The preceding list of factors is not exhaustive of all possible risk factors and other factors could also adversely affect the Bank’s results. When relying on forward-looking statements to make decisions with respect to the Bank and its securities, investors and others should carefully consider the preceding factors, other uncertainties and potential events. The Bank does not undertake to update any forward-looking statements, whether written or oral, that may be made from time to time by or on its behalf.Additional information relating to the Bank, including the Bank’s Annual Information Form, can be located on the SEDAR website at www.sedar.com and on the EDGAR section of the SEC’s website at www.sec.gov.

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Table of Contents• Scotiabank Overview.………………………………………………………………………………………………………………….......................  • Scotiabank Strategy & Financial Objectives 

– Key Strategic Priorities ……………...…………………………………………………………………………………............................– Medium‐Term Financial Objectives ….…………………………………………………………………..….................................

• Scotiabank Business Line Overview– Canadian Banking.…………………………………………………………………………………………………...................................– International Banking.………………………………………………………………………………………………….............................– Wholesale Banking.………………………………………………………………………………………………………………...................

• Scotiabank Key Issues– Energy Exposure.……………………………………………………………………………………………………………...........................– Digital Focus.………………………………………………………………………………………………………………….…........................– Domestic Retail Exposure………………………………………………………………………………………………………...................– Canadian Household Debt ……………………………………………………………………………………………….........................

• Scotiabank Track Record……………………………………………………………………………………………………………….....................• Funding …………………………………………………………………………………………………………………………………………………………….• Canadian Covered Bonds ………………………………………………………………………………………………………………………………….• Appendix 1: Canada & Select International Economies……….……………………………………..……………….......................• Appendix 2: Canadian Housing Market.…………………………………………………………………………………….….....................• Appendix 3: Tangerine Overview .………………………………………………………………………………………………………………………• Appendix 4: Latin America Overview ………………………………………………………………………………………………………………...

4

910

121314

1617181920232732374143

4

Scotiabank Overview

5

Canada’s International Bank

• Global footprint in over 55 countries

• Established on east coast of Canada in 1832

• In U.S. and Caribbean 125+ years

• Representative offices in Asia and Latin America 

since 1960’s

• Began expanding Caribbean presence into 

Central and South America in 1990’s. Primary 

focus in the region is on the countries of 

Mexico, Peru, Colombia and Chile

History

(1) Adjusts for restructuring charge of $278 million after-tax ($378 million before-tax)(2) Taxable Equivalent Basis(3) Basel III “all-in” Common Equity Tier 1 Ratio(4) A securities rating is not a recommendation to buy, sell or hold securities and may be subject to revisions or withdrawals at any time

Franchise in attractive markets

As at Q3 2016 (C$)1 Scotiabank

Total Assets $907BCET1 Risk Weighted Assets $358BMarket Capitalization $80BQ3/16 Net Income $1,959MROE 14.8%Productivity Ratio2 52.8%Capital Ratio3 10.5%# of Employees 88,783

Scotiabank Credit Ratings4

Moody’s S&P Fitch DBRS

Senior Rating Aa3 A+ AA‐ AA

Outstanding Covered Bonds

Aaa Not Rated AAA AAA

Outlook Negative Stable Stable Negative

6

Diversified and Profitable Businesses

50%22%

28%

Canadian Banking

International Banking

Global Banking  and Markets

Geographic Segment Average Assets1

Diversified by products, customers and geographies, creating stability and lower riskCentralized control over key functions: capital, expense and risk management

(1) Reflects Q3/16 results and excludes Other segment(2) Pacific Alliance includes Mexico, Peru, Colombia and Chile

59%14%

9%18%

Canada

U.S. (Wholesale)

Pacific Alliance

OtherInternational

2

Business Line Earnings1

• Well diversified across business segments• Approximately 80%+ from stable, high 

quality personal and commercial banking earnings in Canada and International markets

• International Banking representing 28% of earnings, are in regions with higher growth potential (Appendix 4), such as the Pacific Alliance countries of Mexico, Peru, Chile and Colombia  Mexico, Peru, Chile and Colombia 

represent two thirds of International Banking earnings

• Global Banking and Markets accounting for 22% of the Bank’s earnings 

Personal & Commercial Banking      (78%)

7

Financial Highlights – Q3/16Net Income ($m)

54.4% 53.6%

56.1%

52.2%(1) 52.8%

48%50%52%54%56%58%

Q3/15 Q4/15 Q1/16 Q2/16 Q3/16

Productivity Ratio(2)

0.42% 0.42%1 0.45%0.59%

(3)

0.47%

0.00%

0.15%

0.30%

0.45%

0.60%

0.75%

Q3/15 Q4/15 Q1/16 Q2/16 Q3/16

PCL Ratio

• Net Income of ~$2.0 billion increased by 6% Y/Y• Strong results across all three business lines

- Canadian Banking net income of $930 million, increased by 8% Y/Y

- International Banking net income of $527 million, increased by 9% Y/Y

- Global Banking and Markets net income of $421 million, increased by 12% Y/Y

• Revenue growth of 8% Y/Y, driven by volume growth and higher non‐interest income 

• Expenses growth up 5% Y/Y, driven by continued investment in strategic initiatives reflecting higher technology and professional costs 

• Productivity(2) decreased by 160 basis points to 52.8%- Positive operating leverage YTD 

• Credit trends improved from peak levels last quarter - PCL ratio(3) decreased by 12 basis points to 47 bps - GIL ratio increased by 4 basis points to 1.10%

• Capital remains strong with a Tier 1 Capital Ratio of 10.5%- ~$1.0 billion in internal capital generation - Leverage ratio of 4.2% 

(1) Adjusts for restructuring charge of $278 million after‐tax ($378 million before‐tax)

(2) Effective Q3/16, the taxable equivalent adjustment is no longer included in the calculation. Prior period amounts have been restated for all the banks.

(3)     Adjusts for collective allowance increase; including collective allowance increase, All Bank PCL ratio was 0.64%

1,847  1,843 1,814 

1,862(1)

1,959 

1,7001,7501,8001,8501,9001,9502,000

Q3/15 Q4/15 Q1/16 Q2/16 Q3/16

8

Scotiabank Strategy & Financial Objectives 

9

Key Strategic Priorities

Customer Focus

Leadership

Low Cost by Design 

Digital

Business Mix 

10

Medium‐Term Financial Objectives 

Metric Objectives Q3/16 YTD

All Bank

EPS Growth 5-10% 5.0%

ROE 14%+ 14.3%

Operating Leverage Positive 1.6%

Capital Maintain strong ratios 10.5%

Canadian Banking (Investor Day – April 2014)

Net Income Growth 7-9% 11.0%

International Banking (Investor Day – January 2016)

Net Income Growth 8-10% 13.6%

11

Scotiabank Business Line Overview

12

Our Businesses – Canadian Banking 

Business Overview 

• Full suite of financial advice and banking solutions to retail, small business and commercial customers

• Investment, pension and insurance advice and solutions• Revenue mix: retail (57%), wealth (26%), commercial (17%)• Average loan mix: residential mortgage (61%), personal & credit card loans (25%), business and government loans & acceptances (14%)

• Improve customer service by transforming the distribution network, streamlining customer journeys, and offering customized advice & solutions

• Enhance business mix by driving continued growth in Commercial Banking, credit cards and core deposits

• Expand Tangerine and position to become leading everyday bank in Canada

• Grow & diversify Wealth Management • Reduce structural costs to deliver sustained cost savings and invest in our business and technology, drive customer experience excellence and drive greater efficiency 

Business PerformanceQ3/16 Highlights• 50% of consolidated net income• Net income up 8% Y/Y• Higher NIMs (+13 bps Y/Y)• Double digit growth in credit cards and 

auto lending• Retail chequing was up 9% and savings 

deposits were up 14%• Positive operating leverage 

Key Data  In C$Total Loans (avg.) $303BTotal Deposits (avg.) $224BNet Income  $930MMProductivity Ratio  51.5%Branches 997# of Employees 25,436

Personal & Commercial Banking, Wealth and Insurance

Net Income ($m)

(1) Including the gain on sale of a non-core lease financing business for $100 million after-tax ($116 million pre-tax)

2016 Priorities 

863 837875

977(1) 930

700

800

900

1,000

Q3/15 Q4/15 Q1/16 Q2/16 Q3/16

13

• Operate primarily in Latin America (Mexico, Peru, Chile and Colombia), Central America and the Caribbean, with full range of personal and commercial financial services as well as wealth products and solutions

• Revenue mix: Latin America(1)(65%), Caribbean & Central America 

(31%), Asia (4%)• Average loan mix: residential mortgage (26%), personal & credit card loans (22%), business and government loans & acceptances (52%)

• Improve retail customer experience to maintain customer relevancy and loyalty

• Invest in Mexico to drive growth, build greater relevance and presence, and strengthen our foundational capabilities in this key market 

• Target higher profitability business across the Pacific Alliance Countries to become the primary bank in selected segments 

• Streamline our operational infrastructure to be better organized to serve our customers, achieve structural cost reductions and consolidate our operations to drive greater efficiency 

Our Businesses – International Banking 

Business PerformanceQ3/16 Highlights• 28% of consolidated net income• Net income up 9% Y/Y• Strong loan, deposit and fee income 

growth• Ex. FX translation, total loans were 

up 11% (Latin America up 14%) and total deposits were up 17%

• Positive operating leverage 

Key Data In C$Total Loans (avg.) $102BTotal Deposits (avg.) $87BNet Income $527MMProductivity Ratio 55.5%Branches 1,823# of Employees 51,972

Net Income ($m)

Personal & Commercial Banking, Wealth and Insurance

Business Overview

(1) Excludes affiliates, includes Mexico

2016 Priorities 

485504 505 500

527

450

500

550

Q3/15 Q4/15 Q1/16 Q2/16 Q3/16

14

Business PerformanceQ3/16 Highlights• 22% of consolidated net income• Net income up 12% Y/Y• Strong loan growth across Canada, 

U.S. and Europe• Higher contributions from fixed 

income, corporate and investment banking and precious metals

• Partly offset by higher PCLsKey Data In C$Total Loans (avg.) $81BTrading Assets (avg.) $98BTotal Deposits (avg.) $80BNet Income $421MMProductivity Ratio 44.0%# of Employees 2,587

77%

Wholesale banking and capital markets products to corporate, government and institutional clients• Full service platform in Canada and Mexico. Niche focus in U.S., Central and South America, Asia, Australia and select markets in Europe

• Revenue mix: Business Banking (53%), Capital Markets (47%)

• Enhancing customer focus to improve coverage and deepening relationships 

• Leveraging our global footprint to grow our business in Latin America (particularly the Pacific Alliance), and in Asia and Australia in select markets 

• Strengthening our data and analytics capabilities • Focusing on strategic sectors through our businesses and geographies on the key sectors of Energy, Mining, Infrastructure and Financials

• Improving efficiency and effectiveness 

Wholesale Banking 

Our Businesses – Global Banking and Markets 

Business Overview 

Net Income ($m)

2016 Priorities 

375 325 366 323421

0

200

400

600

Q3/15 Q4/15 Q1/16 Q2/16 Q3/16

15

Scotiabank Key Issues

16

Key Issues ‐ Energy Exposures

• Energy exposure is well diversified across sectors and geographies

• $16.1B drawn energy exposure, is 3.3% of the Bank’s total loan book Down 1% Q/Q ~52% is investment grade

• $11.9B of undrawn energy exposure, up 4.4% Q/Q  ~69% is investment grade

• PCLs of $37 million in Q3/16, decreased by $113 million from last quarter Cumulative energy loan losses for 2015 to 2017 at 

low end of guidance • Actively managing exposures to select non‐investment 

grade E&P and Services accounts  Approximately two‐thirds of focus accounts have 

issued debt ranking below the Bank’s senior position 

• The Bank continues to evaluate exposures and conducts stress tests at current and realistic oil prices with consideration of secondary impacts

• The stress tests indicate that any potential losses are very manageable and within our risk expectation

Drawn Energy Exposure by Sector

Drawn Energy Exposure by Geography1

36%

22%

42%

Canada

U.S.

Other

52%

25%

13%10%

E&P

Midstream

Downstream

Services

2

(1) By country of residence

(2) Other includes Latin America, Asia and Europe

17

Key Issues ‐ Digital Focus• One of the Bank’s key strategic priorities is digital 

transformation and management has already embarked on a number of related initiatives

• Embarked on a number of “Rapid Labs” to reduce pain points in key business processes including Mortgages, Credit Cards, Day to Day Banking, Branches, Small Business and Wealth 

• Opening a digital factory in 2H/16 to house our data scientists, data analytics and digital teams 

• Piloting new branch formats that centralize around advice• Implementing Agile processes across the Bank 

• In addition, Tangerine provides the Bank with a key competitive advantage as a low‐cost, scalable digital bank 

• Direct everyday savings bank with a chequingaccount and newly launched credit card

• “Innovation incubator” that can prove technologies before deploying across Scotiabank 

• Highest ranking by J.D. Power House for customer satisfaction (Net Promoter Score of 80)

• 2 million customers (attractive client profiles) and 12 million direct ready Canadians 

• Over 90% of Tangerine clients are non‐Scotiabank clients

Rapid Labs 

18

Key Issues ‐ Domestic Retail Exposures• Portfolio is ~$263 billion (~93% secured ‐ 81% real estate and 

12% auto)• Real estate is diversified with a high level of insured mortgages 

(59%), while uninsured has significant equity (~50% LTV)• Credit card portfolio is approximately $6.8 billion, reflecting 

~2.6% of Domestic retail loan book or 1.4% of the Bank’s total loan book 

• Organic growth strategy that is focused on payments and deepening customer relationships

• ~80% of growth is from existing customers (penetration rate low‐30s versus peers in the low‐40s)

• Strong risk management culture with specialized credit card teams, customer analytics and collections focus 

• Auto Loan book is approximately $32 billion• Market leader and portfolio is structurally different 

than peers with 10 OEM relationships (8 are exclusive)• Lower credit loss experience because: 

• Higher mix of new versus used auto sales• Higher mix of subvented business 

• Lending terms have been declining with contractual terms averaging 72 months but effective terms are 48 months

• Alberta retail loan book is approximately $39.6 billion or 15% of the Domestic retail loan book

• No signs of material credit stress or drawdown on lines• Credit trends have moved up to/through national levels• Majority of exposure is residential (65% insured)

Domestic Retail Loan Book

Canadian Banking – Risk Adjusted Margin

81%

12%3%

4%Real EstateSecured Lending

Auto

Cards

Other

2.00%

2.05%

2.10%

2.15%

2.20%

Q3/15 Q4/15 Q1/16 Q2/16 Q3/16

19

Key Issues ‐ Canadian Household Debt • Household debt has been increasing since the mid‐1980’s

– Low interest rates, demographics (including immigration), financial innovation and shift in consumer attitude/behaviour

– Driven largely by increasing mortgage debt 

• Media/industry participants largely focus on a “flawed” metric – “Household debt to income” ratio mixes a “stock” or debt with “flow” or disposable income => put 

another way, no one expects a borrower to pay off all their debt with one year’s income

• Other key considerations around consumer indebtedness and consumer resilience to shocks:– Housing affordability – Debt service ratios are at all‐time lows 

Canada ranks among the best against other developed countries as per McKinsey– Net worth –Net asset levels  (assets less debt) are also near all‐time highs  

About half of those assets are financial (not just real estate) Asset growth has outpaced debt growth 

– Interest rate shocks – Despite outlook for higher rates in time, there are mitigating factors Many Canadians take advantage of prepayment options (interest is not tax deductible in Canada) Canadians have substantial equity in homes  Variable rate borrowers can “fix” their mortgage if rates rise Variable rate borrowers are adjudicated at the posted 5‐year fixed rate 

– Unemployment rate – a key driver of delinquencies and losses (given borrowers ability to pay debt)  Levels are expected to remain fairly stable over the next 2‐3 years 

20

Scotiabank Track Record

21(1) Reflects adoption of IFRS in Fiscal 2011(2) Excludes notable items

Dividend per Share (C$)Earnings Per Share (C$)1, 2

Solid Track Record of Earnings and Dividend Growth

$3.05

5.674.43

08 09 10 11 12 13 14 15 Q3/16YTD

• Focused strategies to drive long‐term growth • Canadian Banking: Target 7‐9% earnings 

growth and 400bps improvement in productivity ratio – Focused on customer experience, 

business mix shift and distribution network/digitization to improve costs

• International Banking: Target 8‐10% earnings growth and positive operating leverage – Attractive, higher growth and 

underpenetrated banking markets • Global Banking and Markets 

– Current earnings reflect trough levels and focused on strategic agenda

• Strong track record of consistent dividends (and increases) with a current yield of approximately 4.5%

• The Bank has never cut its dividend • Dividend increases are driven in line with 

earnings growth and subject to Board approval 

• Dividend payout ratio target range of 40‐50%

• Current quarterly dividend of $0.74 per share implies a dividend payout ratio of ~48%

• The Bank has strong capital levels to support capital initiatives including dividend increases and share buybacks 

$1.922.72

2.14

08 09 10 11 12 13 14 15 Q3/16YTD

22

• A unique, stable, straightforward and successful bank model • Diversified by business and geography providing long‐term sustainable earnings• Approximately 80% of earnings from stable retail, commercial and wealth 

management businesses• Strong risk management culture in Canada, with the growth potential of International 

• Clearly defined strategy and well positioned for growth• Focused on organic growth across business lines, with the potential for select tuck‐in 

acquisitions across existing markets that make the Bank better• Significant potential for synergies across a clearly defined restructuring program and 

digital initiatives, including Tangerine • The Bank has significant history in Latin America which is expected to provide better 

and more attractive growth prospects over the long‐term

• Attractive valuation on a P/E and P/B basis, relative to peers • Strong track record of delivering consistent earnings and dividend growth• Dividend yield in the mid‐single digits and dividend has never been cut • Mid‐teens ROEs and strong capital levels 

Why Invest in Scotiabank?

23

Funding

24

Funding Strategy• Build core deposits in all of our key markets

• Achieve appropriate balance between cost and stability of funding– Maintain pricing relative to peers

• Diversify funding by type, currency, program, tenor and markets– Regular issuance in all markets executed via wholesale funding centers in Toronto, New York, London and 

Singapore

• Funding strategy and associated risk management are managed centrally from Toronto within framework of policies and limits approved by Board of Directors

• For countries where we operate a branch banking subsidiary, strategy is for it to be substantially self‐funded in the local market

25

2%

34%

4%34%

1%

10%

8%4%

Wholesale Funding Composition

Subordinated Debt5

Mortgage Securitization4

Covered Bonds

Asset Backed Securities

Medium Term Notes and Deposit 

Notes

ABCP3

Bearer Deposit Notes, 

Commercial Paper & 

Certificate of Deposits 

Deposits from Banks2

Wholesale Funding Diversified by Instrument and Maturity1

1) Wholesale funding sources exclude repo transactions and bankers acceptances, which are disclosed in the contractual maturities table  in the MD&A of the Interim Consolidated Financial Statements. Amounts are based on remaining term to maturity.2) Only includes commercial bank deposits raised by Group Treasury.3) Wholesale funding sources also exclude asset‐backed commercial paper (ABCP) issued by certain ABCP conduits that are not consolidated for financial reporting purposes.4) Represents residential mortgages funded through Canadian Federal Government agency sponsored programs. Funding accessed through such programs does not impact the funding capacity of the Bank in its own name.5) Although subordinated debentures are a component of regulatory capital, they are included in this table in accordance with EDTF recommended disclosures.6) As per Wholesale Funding Sources Table in MD&A. As of Q3/16. 

10

20

30

< 1 Year 2 Years 3 Years 4 Years 5 Years 5 Years >

Maturity Table (ex‐Sub Debt)6

Senior Debt ABS Covered Bonds

$ CDE, BN

26

Diversified Wholesale Funding ProgramsShort‐Term Funding

• USD 25 billion Bank CP program

• USD 3 billion Subsidiary CP program

• CD Programs (Yankee/USD, EUR, GBP, AUD, HKD)

Term Funding & Capital

• CAD 7 billion ABS shelf (unsecured lines of credit)

• CAD 5 billion ABS shelf (credit cards)

• CAD 15 billion shelf (senior debt, preferred shares, subordinated debt, common equity)

• Canada Mortgage Bonds and Mortgage Back Securities

• USD 3 billion Singapore MTN program

• AUD 4 billion Australian MTN program

• USD 25 billion global registered covered bond program (uninsured Canadian mortgages)

• USD 25 billion shelf (senior notes, preferred shares, subordinated debt, common equity)

• USD 20 billion global public covered bond shelf (in run‐off, CMHC insured mortgages)

• USD 20 billion EMTN shelf

27

Canadian Covered Bonds

28

Scotiabank’s Covered Bond Program

Covered Bond Legislation

• Framework passed into law in 2012• Only uninsured mortgages allowed• Statutory protection for the covered bond investor and, as a result, in the event of issuer default, increased certainty for investors with respect to the cover pool of collateral

• Extensive regulatory oversight and pool audit requirements

• Mandatory property value indexation• Established high level of safeguards and disclosure requirements

Global Program

• USD 25 billion global registered covered bond program (uninsured Canadian mortgages)

• Active in multiple currencies: USD, EUR, GBP and AUD

29

Canadian Legislative Covered Bonds (CMHC Registered)Issuance Framework

Canadian Registered Covered Bond Programs’ Legal Framework (Canadian National Housing Act) Canadian Registered Covered Bond Programs Guide issued by Canada Mortgage and Housing Corporation (CMHC)

Eligible Assets Uninsured loans secured by residential property

Mortgage LTV Limits LTV limit of 80%

Basis for Valuation of Mortgage Collateral

Starting in July 2014, issuers are required to index the value of the property underlying mortgage loans in the covered pool while performing various tests

Substitute Assets Securities issued by the Government of Canada Repos of Government of Canada securities having terms acceptable to CMHC

Substitute Assets Limitation 10% of the aggregate value of (a) the loans (b) any Substitute Assets and (c) all cash held by the Guarantor

Cash Restriction The cash assets of the Guarantor cannot exceed the Guarantor’s payment obligations for the immediately succeeding six months

Coverage Test Asset Coverage Test Amortization Test

Credit Enhancement Overcollateralization Reserve Fund Prematurity Liquidity

Swaps Covered bond swap, forward starting Interest rate swap, forward starting

Market Risk Reporting Valuation calculation Mandatory property value indexation

Covered Bond Supervisory Body CMHC

Requirement to Register Issuer and Program Yes; prior to first issuance of the covered bond program

Registry Yes

Disclosure Requirements Monthly investor report with prescribed disclosure requirements set out by CMHC  Investor reports must be posted on a program website Required to meet disclosure requirements in the jurisdictions in which the program is registered (US) or listed (UK)

30

Scotiabank Registered Covered Bond Program

Issuer The Bank of Nova Scotia

Guarantor Scotiabank Covered Bond Guarantor Limited Partnership

GuaranteePayment of interest and principal in respect of the covered bonds will be irrevocably guaranteed by the Guarantor. The obligations of the Guarantor under the Covered Bond Guarantee constitute direct obligations of the Guarantor secured against the assets of the Guarantor, including the Portfolio

Status

The covered bonds will constitute legal, valid and binding direct, unconditional, unsubordinated and unsecured obligations of the Bank and will rank pari passu with all deposit liabilities of the Bank without any preference among themselves and at least pari passu with all other unsubordinated and unsecured obligations of the Bank, present and future

Program Size US$25bn

Ratings Aaa / AAA / AAA (Moody’s / Fitch / DBRS)

Cover Pool First lien uninsured Canadian residential mortgage loans

Asset Percentage 93% (7% minimum overcollateralization)

Law Ontario, Canada

Issuance FormatSEC Registered144A / Reg S (UKLA Listed)

31

Portfolio Details: Scotiabank Global Registered Covered Bond Program1

(1) As at July 28 ,2016(2) Uses indexation methodology as outlined in Footnote 1 of the Scotiabank Global Registered Covered Bond Monthly Investor Report

Remaining Term Distribution

Credit ScoresLoan‐to‐Value Ratios2

Provincial Distribution

2% 3%

7%

14%

20%

54%

599 and Below

600 - 650

651 - 700

701 - 750

751 - 800

801 and Above

5%

21%

40%

33%

1%

0% - 20%

20%-40%

40%-60%

60%-80%

80% and Above

28%

29%10%

7%

9%

17%Less than 12.00

12.00 - 23.99

24.00 - 35.99

36.00 - 41.99

42.00 - 47.99

15%

17%

48%

8%

2% 2%

2%3%3%

Alberta

British Columbia

Ontario

Quebec

Manitoba

New Brunswick

Newfoundland

Nova Scotia

Saskatchewan

32

Appendix 1: Canada & Select International Economies

33

Canadian Economy and Financial System

Strong Financial System

Canadian Banking System ranked World’s Soundest by World Economic Forum for 8th consecutive yearGlobal Competitiveness Report (2015 – 2016)

• Effective regulatory framework– Principles based regime– Single regulator for major banks– Conservative capital requirements– Proactive policies and programs

• Risk management practices– Conservative lending standards– Few sub‐prime mortgages – Relatively little securitization– Primarily originate to hold model

• Canadian banks well capitalized and profitable

Canadian Economy

• The 15th largest economy in the world, with a large export orientation 

• Economy is diversified, with a focus on service, primary, manufacturing, construction and utility industries

• Proactive governments and central bank 

• Manageable Canadian government deficits

• Moderate growth with slowdown in commodity sectors balanced by continuing manufacturing, service sector,  construction, and manufacturing activity

34

0.6

-1.7

-2.6

-3.6 -3.7

-4.4

-5.2-6

-5

-4

-3

-2

-1

0

1

Germany Canada Italy France U.S. U.K. Japan

31.843.7

71.2 75.580.8

88.5

128.5 133.1

0

20

40

60

80

100

120

140

Canada Germany OECD France U.K. U.S. Japan Italy

Canadian EconomyReal GDP Growth

General Government Net Financial Liabilities Government Financial Deficits

annual % change

% of GDP

% of GDP

Canadian GDP by Industry

Source: Statistics Canada, Scotiabank Economics.

20.4%

12.1%

11.4%

10.4%7.3%

6.9%

6.6%

5.4%

4.4%

15.0%

Finance, Insurance & Real Estate

Health & Education

Wholesale & Retail Trade

Manufacturing

Mining and Oil & Gas Extraction

Construction

Public Administration

Professional, Scientific & Technical Services

Transportation & Warehousing

Other

May 2016

Source: OECD (2015 estimates); Scotiabank Economics.  As at August 26, 2016. Source: IMF (2015 estimates),  Scotiabank Economics. As at August 26, 2016.

0

1

2

3

U.S. U.K. Euro zone Canada Japan

2000-2014

2015-2016F

Forecasts as at August 3, 2016. Source: Scotiabank Economics.

35

-2

-1

0

1

2

3

4

5

6

00 02 04 06 08 10 12 14 1660

61

62

63

64

65

66

67

68

69

70

90 92 94 96 98 00 02 04 06 08 10 12 14 16

0

2

4

6

8

10

12

14

90 92 94 96 98 00 02 04 06 08 10 12 14 16

Stable Economic Fundamentals

Labour Force Participation Rate

Unemployment Rate

y/y % change

Inflation

U.S.

Canada

%

U.S.

Canada

Bank of Canada Target Inflation Band

%

U.S.

Canada

Canada• Modest economic growth alongside persistent 

weakness in commodity prices and sluggish exports abroad

• Household spending remains reasonably buoyant, underpinned by relatively low and stable unemployment as well as low borrowing costs

• Population and labour force growth supported by strong immigration

• Stable inflation within Bank of Canada target band

Source: Statistics Canada, BLS, Scotiabank Economics. Data through July 2016.

Source: Statistics Canada, BLS, Scotiabank Economics. Data through July 2016.

Source: Statistics Canada, BLS, Scotiabank Economics. Data through July 2016.

36

Economic Outlook in Key Markets

1.2%

2.0%

1.5%

2.2%

1.7%2.0%

2.4%

2.8%

2.3%

2.8%

3.8%3.6%

Canada2016

Canada2017

U.S.2016

U.S.2017

Chile2016

Chile2017

Mexico2016

Mexico2017

Colombia2016

Colombia2017

Peru2016

Peru2017

Scotiabank’s Key International MarketsCanada / U.S.

Source: Scotiabank Economics, as of August 3, 2016

2016 and 2017 Real GDP Growth Forecast

No Significant Exposure to the BRICs

37

Appendix 2: Canadian Housing Market

38

0

1

2

3

4

5

6

7

90 92 94 96 98 00 02 04 06 08 10 12 14 1635

40

45

50

55

60

65

70

75

80

90 92 94 96 98 00 02 04 06 08 10 12 14 16

Canadian Housing Fundamentals Remain Sound

real estate equity as % of real estate assets

High Percentage of Equity

U.S.

Canada

Mortgage Debt Service Ratio

% of disposable income

Mortgage Interest Payments

Source: Statistics Canada, Scotiabank Economics. Data through 2016Q1.

Source: Statistics Canada, U.S. Federal Reserve, Scotiabank Economics. Data through 2016Q1.

Residential Unit Sales to New Listings

0.0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

1.0

90 92 94 96 98 00 02 04 06 08 10 12 14 16

ratio

Seller’s Market

Buyer’s Market

Balanced Market

Residential Mortgages Arrears

Source: CREA MLS, Scotiabank Economics. Data through July 2016.

0

1

2

3

4

5

6

90 92 94 96 98 00 02 04 06 08 10 12 14 16

% of mortgages in arrears 3 months or more

U.S.

Canada

Source: CBA, MBA, Scotiabank Economics. Data through 2016 Q2.

• Steady population and household income gains, low interest rates and continuing immigration are underpinning demand

• High household debt supported by continuing low debt service costs, low unemployment and significant home equity

• Unemployment rate remains low and stable

• Structural considerations, strong underwriting discipline and conservative lending policies are reflected in low delinquency rates

• Affordability strain observed in select markets

39

$83.3

$25.3 $26.6$13.7 $11.7 $8.3

Ontario B.C. & Territories Alberta Quebec Atlantic Provinces Manitoba &Saskatchewan

Scotiabank’s Canadian Residential Mortgage Portfolio• Mortgage business model is originate to hold• 59% of the mortgage portfolio is insured• 41% is uninsured and has an average loan‐to‐value (LTV) of 50%• Majority is freehold properties; condominiums represent approximately 12% of the portfolio • Good diversification across Canada with approximately half of the portfolio anchored in Ontario• Loans to Canadian condominium developers were $845 MM at Q3/16 ($839 MM at Q2/16)

– High quality portfolio of well known developers with longstanding relationships with Scotiabank

(1) LTV calculated based on the total outstanding balance secured by the property. Property values indexed using Teranet HPI data.(2) Some figures on bar chart may not add due to rounding.

41%59%

Insured

Uninsured(avg. LTV = 50%1)

$93.1

$31.6 $30.2

$15.3 $11.9$1.6 $8.9

$3.6

$0.6$0.2

$6.3

$9.8

$169B

Condominium$22B

Freehold

Canadian Mortgage Portfolio: $191B (spot balances as at Q3/16, $B)

40

Housing Market Structural Differences vs. U.S.

Canada U.S.

Regulation and taxation

• Mortgage interest not tax deductible• Full recourse against borrowers in most provinces (in Alberta and 

Saskatchewan, recourse is only to the value of property)• Ability to foreclose on non‐performing mortgages with no stay periods• Mandatory default insurance for any mortgage with Loan‐to‐Value >80%

‐ CMHC insurance backed by the government of Canada (AAA). Private insurers are 90% government backed

‐ Insurance available for homes up to $1 million‐ Premium is payable upfront by the customer‐ Covers full amount for life of mortgage

• Customers with LTV > 80% must qualify at a 5‐year fixed rate for variable or less than 5‐year term mortgages

• Re‐financing cap of 80% on non‐insured mortgages• Maximum 25‐year amortization on mortgages with LTV > 80%• Maximum 30‐year amortization on conventional (LTV < 80%) mortgages• Down payment of > 20% required for non‐owner occupied properties

• Tax deductible mortgage interest creates incentive to borrow and delay repayment

• Lenders have limited recourse in most states

• 90 day to 1 year stay period to foreclose on non‐performingmortgages

• No regulatory LTV limit• Private insurers are not 

government backed

Product• Conservative product offerings, fixed or variable rate options • Can include exotic products 

(adjustable rate mortgages, interest only)

Underwriting• Terms usually 3 or 5 years, renewable at maturity• Extensive documentation and strong standards

• 30‐year term most common• Wide range of documentation and 

underwriting requirements

41

Appendix 3: Tangerine Overview

4242

• Tangerine is transitioning from Mono‐Line to Multi‐Product offering to better meet the everyday banking needs of Canadians.

• The Everyday Bank Strategy offers Tangerine superior growth opportunities compared to the Bank’s previous Savings‐only business model, including:

Diversified NIAT profile in the face of intensified competition and low interest rates; 

An evolved client experience that positions Tangerine as a financial catalyst instead of a utility;

Higher client growth from new products/cross‐sell; and  Stickier client base due to primary relationship status.

• Over the past two years, significant progress has been made to solidify Tangerine as Canada’s leading direct bank. In 2016, Tangerine will focus on enhancing its position by:

Delivering a unique, transformational client experience; Acquiring new clients and deepening existing client 

relationships; Solidifying Tangerine’s Brand and Purpose in the 

marketplace; Leveraging additional opportunities for collaboration 

between Tangerine and Scotiabank.• Client satisfaction continues to be the Bank’s principal focus

• Tangerine – Low Cost, Scalable Digital Bank

Tangerine OverviewAttractive Client Profile 

Attractive Client Profile 

Client Sources 

43

Appendix 4: Latin America Overview

44

Investment Approach • Scotiabank has a deep history in the Latin American region• Our investment approach has remained consistent, in that we start small, understand the 

market opportunities and build incrementally as the right opportunities present themselves • We have invested approximately $6.4 billion over the last 2 decades • We continue to focus on transactions in our existing markets to build greater scale and long‐

term sustainable profitability • We are not looking to enter new markets or “plant new flags”

The Pacific Alliance • Management has identified the Pacific Alliance as a key area of growth for the Bank • The Pacific Alliance reflects a trade bloc with a free trade agreement to liberalize commerce 

and improve integration among Mexico, Peru, Chile and Colombia (and it is expanding)• The strategic purpose of the Pacific Alliance is to strengthen trade flows with Asia and to 

compete with Brazil and Argentina• The Pacific Alliance combined, accounts for 40% of Latin America’s GDP, comparable to Brazil

Latin America ‐ Overview

The Pacific Alliance is a key area of growth for the Bank => through both acquisitions and organically

45

Presents an Attractive Long‐Term Opportunity • Reflects the 6th largest economy in the world and 7th largest exporter• Trade bloc with respective governments supporting growth/significant infrastructure spending • Strong and favourable relative GDP growth rates (avg. of 2.5‐3.5% versus 2‐3% in North 

America)• Considerable room to increase banking penetration  (avg. domestic credit/GDP of 64%)• Fast‐growing middle‐class with increasing financial needs (eg. 7/10 Peruvians are middle class)• Favourable demographics for banking needs  (median age of 29 years old)• Relatively stable legal, tax and regulatory infrastructure in place• Central bankers have earned credibility and banking system is well‐capitalized 

Recent acquisitions in the Pacific Alliance • 51% of Cencosud’s credit card and consumer loan unit in Chile • Citibank’s retail and commercial banking operations in Peru • 50% of BBVA’s AFP Horizonte, a pension fund management business in Peru• 51% of Colfondos AFP, a pension fund management business in Colombia• Citibank’s Credito Familiar, a consumer finance unit in Mexico

Latin America ‐Why The Pacific Alliance?

The Bank believes in the Pacific Alliance’s long‐term growth prospects

46

Pacific Alliance Details

Mexico Peru Chile Colombia Total / Average 5

Annual GDP Growth 1 2015F2.5%

2016F2.4%

2015F3.2%

2016F3.8%

2015F2.1%

2016F1.7%

2015F3.1%

2016F2.3%

2015F2.7%

2016F2.6%

Banking Penetration 2 (Loans / GDP) 50% 32% 74% 46% 51%

Domestic Credit / GDP 3 54% 28% 124% 53% 65%

Current Account / GDP 4 ‐3.5% ‐3.7% ‐2.7% ‐5.9% ‐4.0%

Market Share and Rank 4(Total Loans) 5.6%      #7 16.6%    #3 6.2%      #7 5.2%      #7 8.4%      #6

Country Credit Rating 4(S&P) BBB+  BBB+  AA‐ BBB‐ BBB+

Population 4 128.6M 32.4M 18.2M 48.8M 228M

Median Age 27 27 33 29 29

(1) As of August 3, 2016 as per Scotiabank(2) As of Q4/14 as per Scotiabank (3) As of 2015(4) As of Q2/16 as per Scotiabank(5) Reflects un-weighted average

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Jake Lawrence 416‐866‐5712Senior Vice President   jake.lawrence@scotiabank.com

Steven Hung 416‐933‐8774Director steven.hung@scotiabank.com

Ian Berry

Investor Relations Contact Information 

For further information, please contact: www.scotiabank.com/investorrelations