Consolidated Financial Statements

Consolidated Statement of Cash Flows

For the Year Ended October 31 (Canadian $ in millions)		2008		2007		2006

Cash Flows from Operating Activities
Net income	$	1,978	$	2,131	$	2,663
Adjustments to determine net cash flows provided by (used in) operating activities
Write-down of securities, other than trading		324		18		9
Net (gain) on securities, other than trading		(9)		(264)		(154)
Net (increase) decrease in trading securities		8,275		(23,028)		(8,565)
Provision for credit losses		1,330		353		176
(Gain) on sale of securitized loans (Note 8 PDF)		(420)		(202)		(69)
Change in derivative instruments
– (Increase) decrease in derivative asset		(29,370)		(4,991)		356
– Increase in derivative liability		20,645		5,807		3,328
Amortization of premises and equipment (Note 11 PDF)		393		390		360
Amortization of intangible assets		42		46		44
Net (increase) in future income taxes		(157)		(176)		(153)
Net increase (decrease) in current income taxes		(314)		(800)		144
Change in accrued interest
– (Increase) decrease in interest receivable		303		(129)		(468)
– Increase (decrease) in interest payable		(351)		537		303
Changes in other items and accruals, net		1,590		(1,243)		1,084
(Gain) on sale of land and buildings (Note 11 PDF)		(13)		(6)		–

Net Cash Provided by (Used in) Operating Activities		4,246		(21,557)		(942)

Cash Flows from Financing Activities
Net increase (decrease) in deposits		(1,412)		45,222		13,108
Net increase (decrease) in securities sold but not yet purchased		(7,251)		10,328		(708)
Net increase (decrease) in securities lent or sold under repurchase agreements		(3,731)		2,325		9,987
Net increase (decrease) in liabilities of subsidiaries		2,045		335		(94)
Repayment of subordinated debt (Note 18 PDF)		(150)		(483)		(425)
Proceeds from issuance of subordinated debt (Note 18 PDF)		900		1,200		700
Redemption of preferred share liability (Note 21 PDF)		–		(200)		–
Proceeds from issuance of preferred shares (Note 21 PDF)		550		600		–
Proceeds from issuance of common shares		182		245		258
Share issue expense		(10)		(14)		–
Common shares repurchased for cancellation (Note 21 PDF)		–		(524)		(376)
Dividends paid		(1,483)		(1,396)		(1,163)

Net Cash Provided by (Used in) Financing Activities		(10,360)		57,638		21,287

Cash Flows from Investing Activities
Net (increase) decrease in interest bearing deposits with banks		10,077		(5,709)		901
Purchases of securities, other than trading		(26,423)		(50,366)		(20,433)
Maturities of securities, other than trading		16,984		24,635		9,494
Proceeds from sales of securities, other than trading		8,268		11,824		7,920
Net (increase) in loans and loan substitute securities		(23,387)		(9,265)		(18,868)
Proceeds from securitization of loans (Note 8)		11,448		3,330		4,994
Net (increase) decrease in securities borrowed or purchased under resale agreements		14,665		(8,280)		(3,723)
Proceeds from sales of land and buildings (Note 11 PDF)		19		45		–
Premises and equipment – net purchases		(449)		(405)		(519)
Acquisitions (Note 12 PDF)		(155)		(301)		(70)

Net Cash Provided by (Used in) Investing Activities		11,047		(34,492)		(20,304)

Effect of Exchange Rate Changes on Cash and Cash Equivalents		551		(397)		5

Net Increase in Cash and Cash Equivalents		5,484		1,192		46
Cash and Cash Equivalents at Beginning of Year		3,650		2,458		2,412

Cash and Cash Equivalents at End of Year	$	9,134	$	3,650	$	2,458

Represented by:
Cash and non-interest bearing deposits with Bank of Canada and other banks	$	6,936	$	2,264	$	1,154
Cheques and other items in transit, net		2,198		1,386		1,304

	$	9,134	$	3,650	$	2,458

Supplemental Disclosure of Cash Flow Information
Amount of interest paid in the year	$	9,900	$	10,543	$	7,873
Amount of income taxes paid in the year	$	456	$	940	$	630

The accompanying notes are an integral part of these consolidated financial statements. Certain comparative figures have been reclassified to conform with the current year’s presentation.