#1Scotiabank#2Investor Presentation December 2, 1998 Scotiabank#3S.S. Marwah ● Performance highlights good quarter despite weaker capital markets strong growth in core results over last year • asset quality stable in quarter • lower unrealized security gains • improvement in capital ratios 1 Scotiabank#41998 results inc/(dec) inc/(dec) 1998 vs. 97* Q4/98 vs Q3/98 Net Income 1,394 14%** 359 $ mm EPS, $ 2.64 12% 0.67 (1%) ROE, % 15.3 (1.1) 14.8 (0.7) Tier 1,% 7.2 0.3 7.2 0.3 *1997 excludes unusual items ** 8% decrease yr/yr on a reported basis 2 Scotiabank#59 years of record core earnings 2000 $ mm 1500 1000 Net Income 500 0 90 92 94 & 97 exclude unusual items 3 EPS SA 3 2 1 0 56 94 96 97 98 Scotiabank#6Consistent record of increasing dividends 80 60 40 Annual dividend, cents/share 20 1988 1990 1992 1994 1996 Amounts adjusted for 2-1 share split, effective February 12, 1998 4 84¢ 1998 Q1/99 annualized Scotiabank#7Healthy year-over-year growth $ millions 1998 Yr/Yr Q4/98 Q4/Q3 Net interest income (TEB) Other income 4,506 22 % 1,186 3 % 2,858 25 690 (3) Total revenues 7,364 23 % 1,876 1 % Provision for credit losses 595 68 124 Non-interest expenses 4,446 22 1,143 1 Taxes/other 929 23 250 Net income 1,394 14 % 359 1997 excludes unusual items LO Scotiabank#8Retail & Commercial - doing well 800 Net Income, $ mm +16% 600 400 200 0 97 98 good retail growth - retail fees up 25% - mortgages up 9% • market share increase in retail deposits strong growth in commercial business Scotiabank 6#9Retail transactions moving to electronics % 14 branch transactions as a % of 12 total registered telephone & PC customers mm 3 2 1 10 0 Q4/97 Q1/98 Q2/98 Q3/98 Q4/98 7 Scotiabank#10International - building future earnings Net Income, $ mm 300 200 100 0 -100 1997* 1998 strong results in Caribbean • Banco Quilmes contributing ⚫ Asia turning around *1997 excludes $290 mm after-tax LDC provision reversal 8 Scotiabank#11Corporate - another strong year 600 400 200 0 Net Income, $ mm +21% • 6th record year 97 98 • top 10 agent in U.S. • 26% up in revenues 9 Scotiabank#12Investment Banking - weaker second half 150 1998 Net Income, $ mm 100 50 steady client flow • excellent start for ScotiaMocatta • lower gains on securities. & trading revenues • risk controls effective 0 Q1 Q2 Q3 Q4 Scotiabank 10#13Revenues holding up in most products* 1998 Investment Bkg, Other Income, $mm 300 200 100 0 -100 Q1 Q2 Q3 *excludes gains on Investment Securities. 11 Q4 Underwriting & brokerage FX, PM & derivatives Debt & equities Scotiabank#14Risk management overview net impaired loans flat on the quarter ― some increases in North America - ― decreases in International - • Asia & Latin America risk stable • 1998 specific provisions = $495mm • moderate market risk -risk systems performed well 12 J.F.M. Crean Scotiabank#15Steadily improving impaired loans 2 1.5 1 0.5 net impaired loans as a % of loans & acceptances 0 94 95 96 97 98 13 Scotiabank#16Asian exposure stable Cross-border = US $3.4b Other Philippines Indonesia Japan Malaysia Thailand Hong Kong Korea 14 Scotiabank#17Latin America - conservative exposure Cross-border = US $3.7b* Investment in affiliates Loans *Nil impaired loans 15 Trade Bradys/ Gov't Secs. Scotiabank#18Trends in credit loss provisions Specific provisions, $ millions 1998 1997 1996 North America Retail 216 172 138 Real Estate (29) (85) 82 Corporate/Commercial 152 111 118 339 198 338 International 156 162 42 495 360 380 16 Scotiabank#19Low variability in trading during the year # net trading revenue, fiscal year 1998 days 30 20 20 10 0 <-10 # 5th percentile I 95th percentile | не -10 -9 -8 -7 -6 -5 -4 -3 -2 -1 0 1 2 3 4 5 6 7 8 9 10 >10 $ millions 17 Scotiabank#20Risk systems performed well 15 0 $ millions, Nov. 3/97 to Oct. 30/98 P&L (net of intraday trading) -VAR, 99%, 1 day -15 -30 Q1 Q2 Q3 18 26 Aug 98 Q4 Scotiabank#21Exceeded our targets in 1998 S.S. Marwah 1998 Target ROE 15.3% VS. 14%+ EPS growth 12% VS. 10% Productivity 60.4% VS. <60% Tier 1 7.2% VS. 7% Scotiabank 19#22Focus for 1999 • Cost control • National Trust integration & Y2K • Wealth management ● Scotia Capital Markets & Corporate integration Building International franchises 20 Scotiabank#23This presentation includes forward-looking statements about objectives, strategies, and expected financial results to assist investors and others in assessing The Bank of Nova Scotia's prospective financial condition and results. Such forward- looking statements are inherently subject to uncertainties beyond the Bank's control, including but not limited to economic and financial conditions globally, regulatory developments in Canada and elsewhere, technological developments, and competition. The reader is cautioned that the Bank's actual performance could differ materially from such forward-looking statements. Scotiabank 21