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Derivative Instruments | 12 Months Ended
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Oct. 31, 2025
Text Block [Abstract] |
Derivative Instruments | Note 7: Derivative Instruments Derivative instruments are financial contracts that derive their value from underlying changes in interest rates, foreign exchange rates or other financial or commodity prices or indices. Derivative instruments can be either regulated exchange-traded contracts or negotiated over-the-counter contracts. We use these instruments for trading purposes, as well as to manage our exposures, mainly to foreign currency and interest rate fluctuations, as part of our asset/liability management program. Types of Derivatives Swaps Swaps are contractual agreements between two parties to exchange a series of cash flows. The various swap agreements that we enter into are as follows:
• |  | Interest rate swaps – counterparties generally exchange fixed and floating rate interest payments based on a notional value in a single currency.
• |  | Cross-currency swaps – counterparties exchange fixed rate interest payments and principal amounts in different currencies.
• |  | Cross-currency interest rate swaps – counterparties exchange fixed and/or floating rate interest payments and principal amounts in different currencies.
• |  | Commodity swaps – counterparties generally exchange fixed and floating rate payments based on a notional value of a single commodity.
• |  | Equity swaps – counterparties exchange the return on an equity security or a group of equity securities for the return based on a fixed or floating interest rate or the return on another equity security or group of equity securities.
• |  | Credit default swaps – one counterparty pays the other a fee in exchange for that other counterparty agreeing to make a payment if a credit event occurs, such as bankruptcy or failure to pay.
• |  | Total return swaps – one counterparty agrees to pay or receive from the other cash amounts based on changes in the value of a reference asset or group of assets, including returns such as interest earned on these assets, in exchange for amounts that are based on prevailing market funding rates.
Forwards and Futures Forwards and futures are contractual agreements to either buy or sell a specified amount of a currency, commodity, interest rate-sensitive financial instrument or security at a specified price and date in the future. Forwards are customized contracts transacted in the over-the-counter market. Futures are transacted in standardized amounts on regulated exchanges and are subject to daily cash margining. Options Options are contractual agreements that convey to the purchaser the right but not the obligation to either buy or sell a specified amount of a currency, commodity, interest rate financial instrument or security at a fixed future date or at any time within a fixed future period. For options written by us, we receive a premium from the purchaser for accepting market risk. For options purchased by us, we pay a premium for the right to exercise the option. Since we have no obligation to exercise the option, our primary exposure to risk is the potential credit risk if the writer of an over-the-counter contract fails to meet the terms of the contract. Caps, collars and floors are specialized types of written and purchased options. They are contractual agreements in which the writer agrees to pay the purchaser, based on a specified notional amount, the difference between the market rate and the prescribed rate of the cap, collar or floor. The writer receives a premium for selling this instrument. A swaption is an option granting its owner the right but not the obligation to enter into an underlying swap. A futures option is an option contract in which the underlying instrument is a single futures contract. The main risks associated with these derivative instruments are related to exposure to movements in interest rates, foreign exchange rates, credit quality, value of the underlying financial instrument or commodity, as applicable, and the possible inability of counterparties to meet the terms of the contracts. Embedded Derivatives From time to time, we purchase or issue financial instruments containing embedded derivatives. The embedded derivative in a financial liability is separated from the host contract and carried at fair value if the economic characteristics of the derivative are not closely related to those of the host contract, the terms of the embedded derivative are the same as those of a stand-alone derivative, and the combined contract is not measured at fair value. To the extent that we cannot reliably identify and measure the embedded derivative, the entire contract is carried at fair value, with changes in fair value reflected in non-interest revenue, in our Consolidated Statement of Income. Embedded derivatives in certain of our guaranteed investment certificate deposits are accounted for separately from the host instrument and presented within deposits in our Consolidated Balance Sheet. Contingent Features Certain over-the-counter derivative instruments contain provisions that link the amount of collateral we are required to post or pay to our credit ratings, as determined by the major credit rating agencies. If our credit ratings were to be downgraded, certain counterparties to these derivative instruments could demand immediate and ongoing collateralization on derivative liability positions or request immediate payment. The aggregate fair value of all derivative instruments with collateral posting requirements that were in a liability position as at October 31, 2025 was $10,894 million ($9,656 million as at October 31, 2024), for which we have posted collateral of $9,117 million ($8,882 million as at October 31, 2024). Risks Hedged Interest Rate Risk We manage interest rate risk through interest rate futures, interest rate swaps and options, which are linked to and adjust the interest rate sensitivity of a specific asset, liability, forecasted transaction or firm commitment, or a specific pool of transactions with similar risk characteristics. Foreign Currency Risk We manage foreign currency risk through currency futures, foreign currency options, cross-currency swaps, foreign exchange spot transactions, forward contracts and deposits denominated in foreign currencies. Equity Price Risk We manage equity price risk through total return swaps. Trading Derivatives Trading derivatives include derivatives entered into with customers to accommodate their risk management needs, market-making to facilitate customer-driven demand for derivatives, derivatives transacted on a limited basis to generate trading income from our principal trading positions, and certain derivatives entered into as part of our risk management strategy that do not qualify as hedges for accounting purposes (economic hedges). We structure and market derivative products to enable customers to transfer, modify or reduce current or expected exposure to risks. Principal trading activities include market-making and positioning activities. Market-making involves quoting bid and offer prices to other market participants with the intention of generating revenues based on spread and volume. Positioning activities involve managing market risk positions with the expectation of profiting from favourable movements in prices, rates or indices. We may also economically hedge a portion of our U.S. dollar earnings through forward foreign exchange contracts and/or options to minimize fluctuations in our consolidated net income due to the translation of our U.S. dollar earnings. These contracts are recorded at fair value, with changes in fair value recorded in non-interest revenue, trading revenues, in our Consolidated Statement of Income. Trading derivatives are recorded at fair value. Realized and unrealized gains and losses are generally recorded in non-interest revenue, trading revenues, in our Consolidated Statement of Income. Unrealized gains and losses on derivatives used to economically hedge certain exposures may be recorded in our Consolidated Statement of Income in the same line as the unrealized gains and losses arising from the exposures. Unrealized gains on trading derivatives are recorded as derivative instrument assets and unrealized losses are recorded as derivative instrument liabilities in our Consolidated Balance Sheet. Fair Value of Trading and Hedging Derivatives Fair value represents a point-in-time estimate that may change in subsequent reporting periods due to market conditions or other factors. A discussion of the fair value measurement of derivatives is included in Note 17. Fair values of our derivative instruments are as follows:
(Canadian $ in millions) |  |  |  |  |  |  |  | 2025 |  |  |  |  |  |  |  |  | 2024 |
|  | Gross assets |  |  | Gross liabilities |  |  | Net |  |  | Gross assets |  |  | Gross liabilities |  |  | Net |
Trading |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest Rate Contracts |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Swaps |  | $ | 2,081 |  |  | $ | (4,905 | ) |  | $ | (2,824 | ) |  | $ | 3,203 |  |  | $ | (5,707 | ) |  | $ | (2,504 | )
Forward rate agreements |  |  | 96 |  |  |  | (155 | ) |  |  | (59 | ) |  |  | 477 |  |  |  | (281 | ) |  |  | 196 |
Purchased options |  |  | 2,783 |  |  |  | – |  |  |  | 2,783 |  |  |  | 2,574 |  |  |  | – |  |  |  | 2,574 |
Written options |  |  | – |  |  |  | (2,639 | ) |  |  | (2,639 | ) |  |  | – |  |  |  | (2,341 | ) |  |  | (2,341 | )
Futures |  |  | 4 |  |  |  | (10 | ) |  |  | (6 | ) |  |  | 21 |  |  |  | (10 | ) |  |  | 11 |
Foreign Exchange Contracts (1) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cross-currency swaps |  |  | 2,796 |  |  |  | (311 | ) |  |  | 2,485 |  |  |  | 1,989 |  |  |  | (1,378 | ) |  |  | 611 |
Cross-currency interest rate swaps |  |  | 11,078 |  |  |  | (12,349 | ) |  |  | (1,271 | ) |  |  | 9,777 |  |  |  | (10,867 | ) |  |  | (1,090 | )
Forward foreign exchange contracts |  |  | 13,535 |  |  |  | (10,458 | ) |  |  | 3,077 |  |  |  | 8,150 |  |  |  | (6,096 | ) |  |  | 2,054 |
Purchased options |  |  | 1,534 |  |  |  | – |  |  |  | 1,534 |  |  |  | 657 |  |  |  | – |  |  |  | 657 |
Written options |  |  | – |  |  |  | (1,362 | ) |  |  | (1,362 | ) |  |  | – |  |  |  | (528 | ) |  |  | (528 | )
Commodity Contracts |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Swaps |  |  | 1,004 |  |  |  | (1,082 | ) |  |  | (78 | ) |  |  | 1,023 |  |  |  | (1,097 | ) |  |  | (74 | )
Purchased options |  |  | 257 |  |  |  | – |  |  |  | 257 |  |  |  | 644 |  |  |  | – |  |  |  | 644 |
Written options |  |  | – |  |  |  | (304 | ) |  |  | (304 | ) |  |  | – |  |  |  | (607 | ) |  |  | (607 | )
Futures |  |  | 201 |  |  |  | (222 | ) |  |  | (21 | ) |  |  | 160 |  |  |  | (117 | ) |  |  | 43 |
Equity Contracts |  |  | 16,459 |  |  |  | (20,973 | ) |  |  | (4,514 | ) |  |  | 14,194 |  |  |  | (25,673 | ) |  |  | (11,479 | )
Credit Contracts |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Purchased |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 1 |  |  |  | (10 | ) |  |  | (9 | )
Written |  |  | 1 |  |  |  | – |  |  |  | 1 |  |  |  | 9 |  |  |  | (1 | ) |  |  | 8 |
Total fair value – trading derivatives |  | $ | 51,829 |  |  | $ | (54,770 | ) |  | $ | (2,941 | ) |  | $ | 42,879 |  |  | $ | (54,713 | ) |  | $ | (11,834 | )
Hedging |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest Rate Contracts (2) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash flow hedges – swaps |  | $ | 2,931 |  |  | $ | (464 | ) |  | $ | 2,467 |  |  | $ | 2,148 |  |  | $ | (915 | ) |  | $ | 1,233 |
Fair value hedges – swaps |  |  | 786 |  |  |  | (1,926 | ) |  |  | (1,140 | ) |  |  | 1,464 |  |  |  | (1,589 | ) |  |  | (125 | )
Total swaps |  |  | 3,717 |  |  |  | (2,390 | ) |  |  | 1,327 |  |  |  | 3,612 |  |  |  | (2,504 | ) |  |  | 1,108 |
Foreign Exchange Contracts |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash flow hedges |  |  | 1,576 |  |  |  | (1,553 | ) |  |  | 23 |  |  |  | 699 |  |  |  | (1,080 | ) |  |  | (381 | )
Fair value hedges |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | (2 | ) |  |  | (2 | )
Net investment hedges |  |  | – |  |  |  | (16 | ) |  |  | (16 | ) |  |  | – |  |  |  | (4 | ) |  |  | (4 | )
Total foreign exchange contracts |  |  | 1,576 |  |  |  | (1,569 | ) |  |  | 7 |  |  |  | 699 |  |  |  | (1,086 | ) |  |  | (387 | )
Equity Contracts |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash flow hedges |  |  | 29 |  |  |  | – |  |  |  | 29 |  |  |  | 63 |  |  |  | – |  |  |  | 63 |
Total equity contracts |  |  | 29 |  |  |  | – |  |  |  | 29 |  |  |  | 63 |  |  |  | – |  |  |  | 63 |
Total fair value – hedging derivatives (3) |  |  | 5,322 |  |  |  | (3,959 | ) |  |  | 1,363 |  |  |  | 4,374 |  |  |  | (3,590 | ) |  |  | 784 |
Total fair value – trading and hedging derivatives |  |  | 57,151 |  |  |  | (58,729 | ) |  |  | (1,578 | ) |  |  | 47,253 |  |  |  | (58,303 | ) |  |  | (11,050 | )
Less: impact of master netting agreements |  |  | (43,254 | ) |  |  | 43,254 |  |  |  | – |  |  |  | (31,576 | ) |  |  | 31,576 |  |  |  | – |
Total |  | $ | 13,897 |  |  | $ | (15,475 | ) |  | $ | (1,578 | ) |  | $ | 15,677 |  |  | $ | (26,727 | ) |  | $ | (11,050 | )
| (1) | Gold contracts are included in foreign exchange contracts.
| (2) | Includes the fair value of bond futures in fair value hedges rounded down to $nil million as at October 31, 2025 ($nil million as at October 31, 2024).
| (3) | The fair values of hedging derivatives wholly or partially offset the changes in fair values of the related on-balance sheet financial instruments.
Assets are presented net of liabilities to customers where we have a legally enforceable right to offset amounts and we intend to settle contracts on a net basis. Notional Amounts of Trading Derivatives The notional amounts of our derivatives represent the amount to which a rate or price is applied in order to calculate the amount of cash that must be exchanged under the contract. Notional amounts do not represent assets or liabilities and therefore are not recorded in our Consolidated Balance Sheet.
(Canadian $ in millions) |  |  |  |  |  |  |  | 2025 |  |  |  |  |  |  |  |  | 2024 |
|  | Exchange-traded |  |  | Over-the-counter |  |  | Total |  |  | Exchange-traded |  |  | Over-the-counter |  |  | Total |
Interest Rate Contracts |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Swaps |  | $ | – |  |  | $ | 14,178,539 |  |  | $ | 14,178,539 |  |  | $ | – |  |  | $ | 16,390,827 |  |  | $ | 16,390,827 |
Forward rate agreements |  |  | – |  |  |  | 841,547 |  |  |  | 841,547 |  |  |  | – |  |  |  | 3,414,449 |  |  |  | 3,414,449 |
Purchased options |  |  | 130,231 |  |  |  | 369,216 |  |  |  | 499,447 |  |  |  | 136,796 |  |  |  | 253,694 |  |  |  | 390,490 |
Written options |  |  | 54,221 |  |  |  | 385,166 |  |  |  | 439,387 |  |  |  | 26,468 |  |  |  | 255,721 |  |  |  | 282,189 |
Futures |  |  | 1,737,629 |  |  |  | – |  |  |  | 1,737,629 |  |  |  | 1,735,442 |  |  |  | – |  |  |  | 1,735,442 |
Total interest rate contracts |  |  | 1,922,081 |  |  |  | 15,774,468 |  |  |  | 17,696,549 |  |  |  | 1,898,706 |  |  |  | 20,314,691 |  |  |  | 22,213,397 |
Foreign Exchange Contracts (1) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cross-currency swaps |  |  | – |  |  |  | 63,306 |  |  |  | 63,306 |  |  |  | – |  |  |  | 64,100 |  |  |  | 64,100 |
Cross-currency interest rate swaps |  |  | – |  |  |  | 1,235,923 |  |  |  | 1,235,923 |  |  |  | – |  |  |  | 891,272 |  |  |  | 891,272 |
Forward foreign exchange contracts |  |  | – |  |  |  | 939,971 |  |  |  | 939,971 |  |  |  | – |  |  |  | 679,250 |  |  |  | 679,250 |
Purchased options |  |  | 6,800 |  |  |  | 98,391 |  |  |  | 105,191 |  |  |  | 3,572 |  |  |  | 76,576 |  |  |  | 80,148 |
Written options |  |  | 5,645 |  |  |  | 107,570 |  |  |  | 113,215 |  |  |  | 3,248 |  |  |  | 88,210 |  |  |  | 91,458 |
Futures |  |  | 10,864 |  |  |  | – |  |  |  | 10,864 |  |  |  | 1,751 |  |  |  | – |  |  |  | 1,751 |
Total foreign exchange contracts |  |  | 23,309 |  |  |  | 2,445,161 |  |  |  | 2,468,470 |  |  |  | 8,571 |  |  |  | 1,799,408 |  |  |  | 1,807,979 |
Commodity Contracts |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Swaps |  |  | – |  |  |  | 22,128 |  |  |  | 22,128 |  |  |  | – |  |  |  | 20,328 |  |  |  | 20,328 |
Purchased options |  |  | 25,126 |  |  |  | 6,706 |  |  |  | 31,832 |  |  |  | 43,931 |  |  |  | 5,495 |  |  |  | 49,426 |
Written options |  |  | 26,830 |  |  |  | 4,090 |  |  |  | 30,920 |  |  |  | 45,440 |  |  |  | 4,268 |  |  |  | 49,708 |
Futures |  |  | 38,470 |  |  |  | – |  |  |  | 38,470 |  |  |  | 36,071 |  |  |  | – |  |  |  | 36,071 |
Total commodity contracts |  |  | 90,426 |  |  |  | 32,924 |  |  |  | 123,350 |  |  |  | 125,442 |  |  |  | 30,091 |  |  |  | 155,533 |
Equity Contracts |  |  | 256,701 |  |  |  | 187,279 |  |  |  | 443,980 |  |  |  | 333,126 |  |  |  | 138,034 |  |  |  | 471,160 |
Credit Contracts |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Purchased |  |  | – |  |  |  | 31,760 |  |  |  | 31,760 |  |  |  | – |  |  |  | 23,350 |  |  |  | 23,350 |
Written |  |  | – |  |  |  | 23,507 |  |  |  | 23,507 |  |  |  | – |  |  |  | 16,211 |  |  |  | 16,211 |
Total credit contracts |  |  | – |  |  |  | 55,267 |  |  |  | 55,267 |  |  |  | – |  |  |  | 39,561 |  |  |  | 39,561 |
Total |  | $ | 2,292,517 |  |  | $ | 18,495,099 |  |  | $ | 20,787,616 |  |  | $ | 2,365,845 |  |  | $ | 22,321,785 |  |  | $ | 24,687,630 |
(1) Gold contracts are included in foreign exchange contracts. Table excludes loan commitment derivatives with a notional amount of $6,219 million ($2,498 million as at October 31, 2024). Derivatives Used in Hedge Accounting We apply the requirements of IAS 39 Financial Instruments: Recognition and Measurement for hedge accounting purposes. In accordance with our risk management strategy, we enter into various derivative contracts to hedge our interest rate, foreign currency and equity price exposures. We also use deposits, cross-currency swaps, foreign exchange forwards and options to hedge foreign currency exposure in our net investment in foreign operations. When the hedged item is accounted for at FVTPL, there is a natural offset within the income statement with the related derivative. However, when we manage risks inherent in instruments that are accounted for at amortized cost, including loans and deposits, or FVOCI debt securities, we use hedge accounting in order to eliminate the mismatch between the hedged item and the mark-to-market derivative. To the extent the instruments used to manage risk qualify for hedge accounting, we designate them in accounting hedge relationships. Our structural market risk strategies, including our approach to managing interest rate and foreign exchange risk, are discussed in the blue-tinted font in the Structural (Non-Trading) Market Risk section of our Management’s Discussion and Analysis. In addition, our exposure to foreign exchange rate risk is discussed in the Non-Trading Foreign Exchange Risk section of our Management’s Discussion and Analysis. Our exposure to, and approach to managing, equity price risk are discussed in the Other Share-Based Compensation – Mid-Term Incentive Plans section of Note 20. By using derivatives to hedge exposures to changes in interest rates, foreign exchange rates and equity prices, we are also exposed to the credit risk of the derivative counterparty. We mitigate credit risk by entering into transactions with high-quality counterparties, requiring the counterparties to post collateral, entering into master netting agreements or settling through centrally cleared counterparties. To qualify as an accounting hedge, the hedging relationship must be designated and formally documented at its inception, detailing the particular risk management objective and strategy for the hedge and the specific asset, liability or cash flow being hedged, as well as how effectiveness is to be assessed. Changes in the fair value of the derivative must be highly effective in offsetting changes in fair value or changes in the amount of future cash flows of the hedged item. We evaluate hedge effectiveness at the inception of the hedging relationship and on an ongoing basis, retrospectively and prospectively, primarily using a quantitative statistical regression analysis. We consider a hedging relationship highly effective when all of the following criteria have been met: correlation between the variables in the regression is at least 0.8; the slope of the regression is within a range of 0.8 to 1.25; and the confidence level of the slope is at least 95%. The practice is different for our net investment hedge, which is discussed in the Net Investment Hedges section below. Any ineffectiveness in a hedging relationship is recognized as it arises in non-interest revenue, other revenues, in our Consolidated Statement of Income. The following table outlines the notional amounts and average rates of derivatives and the carrying amounts of deposits designated as hedging instruments by term to maturity, hedge type and risk type, where applicable.
(Canadian $ in millions, except as noted) |  | Remaining term to maturity |  |  | 2025 |  |  | 2024 |
|  | Within 1 year |  |  | 1 to 3 years |  |  | 3 to 5 years |  |  | 5 to 10 years |  |  | Over 10 years |  |  | Total |  |  | Total |
Cash Flow Hedges |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest rate risk – Interest rate swaps |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Notional amount |  | $ | 85,536 |  |  | $ | 84,666 |  |  | $ | 54,048 |  |  | $ | 31,409 |  |  | $ | 5,440 |  |  | $ | 261,099 |  |  | $ | 266,872 |
Average fixed interest rate |  |  | 3.49 % |  |  |  | 3.06 % |  |  |  | 3.53 % |  |  |  | 3.22 % |  |  |  | 3.87 % |  |  |  | 3.33 % |  |  |  | 3.75 % |
Foreign exchange risk – Cross-currency swaps and foreign exchange forwards (1) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
CAD-USD pair |  | Notional amount |  |  | 10,865 |  |  |  | 16,681 |  |  |  | 11,303 |  |  |  | 334 |  |  |  | 50 |  |  |  | 39,233 |  |  |  | 40,933 |
|  | Average fixed interest rate |  |  | 3.46 % |  |  |  | 3.49 % |  |  |  | 2.99 % |  |  |  | 3.68 % |  |  |  | 2.83 % |  |  |  | 3.34 % |  |  |  | 3.14 % |
|  | Average exchange rate: CAD-USD |  |  | 1.3341 |  |  |  | 1.3258 |  |  |  | 1.3560 |  |  |  | 1.3157 |  |  |  | 1.2327 |  |  |  | 1.3366 |  |  |  | 1.3252 |
CAD-EUR pair |  | Notional amount |  |  | 6,732 |  |  |  | 8,066 |  |  |  | 3,310 |  |  |  | 1,807 |  |  |  | – |  |  |  | 19,915 |  |  |  | 17,399 |
|  | Average fixed interest rate |  |  | 3.74 % |  |  |  | 3.08 % |  |  |  | 3.21 % |  |  |  | 3.77 % |  |  |  | – |  |  |  | 3.39 % |  |  |  | 3.47 % |
|  | Average exchange rate: CAD-EUR |  |  | 1.4190 |  |  |  | 1.4588 |  |  |  | 1.4711 |  |  |  | 1.5935 |  |  |  | – |  |  |  | 1.4596 |  |  |  | 1.4293 |
Other currency pairs (2) |  | Notional amount |  |  | 5,219 |  |  |  | 2,511 |  |  |  | 2,379 |  |  |  | 134 |  |  |  | – |  |  |  | 10,243 |  |  |  | 9,927 |
|  | Average fixed interest rate |  |  | 2.63 % |  |  |  | 4.23 % |  |  |  | 4.12 % |  |  |  | 5.13 % |  |  |  | – |  |  |  | 3.40 % |  |  |  | 3.26 % |
|  | Average exchange rate: CAD-Non USD/EUR |  |  | 1.7080 |  |  |  | 1.5621 |  |  |  | 1.3796 |  |  |  | 0.5717 |  |  |  | – |  |  |  | 1.5812 |  |  |  | 1.5391 |
Equity price risk – Total return swap |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Notional amount |  |  | 552 |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 552 |  |  |  | 480 |
Fair Value Hedges |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest rate risk – Interest rate swaps |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Notional amount |  |  | 65,785 |  |  |  | 59,859 |  |  |  | 58,913 |  |  |  | 31,494 |  |  |  | 4,458 |  |  |  | 220,509 |  |  |  | 188,278 |
Average fixed interest rate |  |  | 3.52 % |  |  |  | 3.62 % |  |  |  | 3.49 % |  |  |  | 3.60 % |  |  |  | 3.82 % |  |  |  | 3.56 % |  |  |  | 3.99 % |
Interest rate risk – Bond futures (exchange-traded derivatives) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Notional amount |  |  | 432 |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 432 |  |  |  | 1,479 |
Average price in dollars |  |  | 154 |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 154 |  |  |  | 108 |
Foreign exchange risk – Cross-currency swaps |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
USD-EUR pair |  | Notional amount |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 21 |
|  | Average fixed interest rate |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 3.25 % |
|  | Average exchange rate: USD-EUR |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 0.9706 |
Net Investment Hedges |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Foreign exchange risk – Cross-currency swaps and foreign exchange forwards |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
CAD-CNH pair |  | Notional amount |  |  | 669 |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 669 |  |  |  | 677 |
Foreign exchange risk – Deposit liabilities |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
USD denominated deposit – carrying amount |  |  | 22,395 |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 22,395 |  |  |  | 16,053 |
GBP denominated deposit – carrying amount |  |  | 355 |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 355 |  |  |  | 300 |
| (1) | Under certain hedge strategies using cross-currency swaps, a CAD leg is inserted to create two swaps designated as separate hedges (for example, a EUR-USD cross-currency swap split into EUR-CAD and CAD-USD cross-currency swaps). The relevant notional amount is grossed up in this table, as the cross-currency swaps are disclosed by CAD-foreign currency pair.
| (2) | Includes CAD-AUD, CAD-CHF, CAD-CNH, CAD-GBP, CAD-HKD, CAD-JPY or CAD-NOK cross-currency swaps, where applicable.
Cash Flow Hedges Cash flow hedges modify exposure to variability in cash flows for variable interest rate bearing instruments, foreign currency denominated assets and liabilities and certain cash-settled share-based payment grants subject to equity price risk. We use interest rate swaps with or without embedded options, cross-currency swaps, forwards and total return swaps to hedge this variability. We hedge the full amount of foreign exchange risk, but interest rate risk is hedged only to the extent of benchmark interest rates. The benchmark interest rate is a component of interest rate risk that is observable in the relevant financial markets; for example, Secured Overnight Financing Rate or Canadian Overnight Repo Rate Average (CORRA). We determine the amount of the exposure to which hedge accounting is applied by assessing the potential impact of changes in interest rates, foreign exchange rates and equity prices on the future cash flows of floating rate loans and deposits, foreign currency denominated assets and liabilities and certain cash-settled share-based payments. This assessment is performed using analytical techniques such as simulation, sensitivity analysis, stress testing and gap analysis. We record interest that we pay or receive on derivatives that hedge interest rate risk or foreign exchange risk in net interest income in our Consolidated Statement of Income over the life of the hedge. Interest paid on derivatives that hedge equity price risk on certain share-based payments is recorded in employee compensation expense. The accounting mismatch that would otherwise occur is eliminated by recording changes in the fair value of the derivative that offset changes in the fair value of the hedged item for the designated hedged risk in other comprehensive income. Hedge ineffectiveness, the portion of the change in fair value of the derivative that does not offset changes in the fair value of the hedged item, is recorded directly in non-interest revenue, other revenues, in our Consolidated Statement of Income as it arises. For cash flow hedges that are discontinued before the end of the original hedge term, the cumulative unrealized gain or loss recorded in other comprehensive income is amortized to our Consolidated Statement of Income in net interest income for interest rate swaps and employee compensation expense for total return swaps as the hedged item is recorded in earnings. If the hedged item is sold or settled, the entire unrealized gain or loss is recognized immediately in net interest income in our Consolidated Statement of Income. In general, we do not terminate our foreign exchange hedges before maturity. For cash flow hedges, we use a hypothetical derivative to measure the hedged risk of floating rate loans, deposits, foreign currency denominated assets and liabilities or share-based payment grants. This hypothetical derivative matches the critical terms of the hedged items identically and perfectly offsets the hedged cash flow. In our cash flow hedge relationships, the main sources of ineffectiveness are differences in interest rate indices, tenor and reset or settlement frequencies between hedging instruments and hedged items, and using hedging instruments without a floor in relationships for hedged items with a floor. Net Investment Hedges Net investment hedges mitigate our exposure to foreign exchange rate fluctuations related to our net investment in foreign operations. Deposits denominated in foreign currencies, cross-currency swaps and foreign exchange forwards are designated as hedging instruments for a portion of our net investment in foreign operations. We designate the spot rate component of our hedging instruments in net investment hedges. The foreign currency translation of our net investment in foreign operations and the effective portion of the corresponding hedging instrument are recorded in net gains on translation of net foreign operations in other comprehensive income, instead of through the income statement in the case of the hedging instrument if hedge accounting had not been elected. The effectiveness of our net investment hedge is determined using either the dollar offset method with spot foreign currency rates or a quantitative statistical regression analysis. As the notional amount of the hedging instruments and the hedged net investment in foreign operations are the same, there are no significant sources of ineffectiveness in these hedging relationships. The following table contains information related to the hedging instruments, hedged items and hedge ineffectiveness for cash flow and net investment hedges for the years ended October 31, 2025 and 2024.
(Canadian $ in millions) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 2025 |
|  | Carrying amount of hedging instruments (1) |  |  |  |  |  | Hedge ineffectiveness |  |  |  |
|  | Asset |  |  | Liability |  |  |  |  |  | Gains (losses) on hedging derivatives used to calculate hedge ineffectiveness (2) |  |  | Gains (losses) on hypothetical derivatives used to calculate hedge ineffectiveness (2) |  |  | Ineffectiveness recorded in non-interest revenue, other revenues |
Cash Flow Hedges |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest rate risk – Interest rate swaps |  | $ | 2,931 |  |  | $ | (464 | ) |  |  |  |  |  |  | $   1,319 |  |  |  | $   (1,382 | ) |  |  | $   3 |
Foreign exchange risk – Cross-currency swaps and foreign exchange forwards |  |  | 1,576 |  |  |  | (1,553 | ) |  |  |  |  |  |  | (214 | ) |  |  | 214 |  |  |  | – |
Equity price risk – Total return swaps |  |  | 29 |  |  |  | – |  |  |  |  |  |  |  | 258 |  |  |  | (258 | ) |  |  | – |
|  |  | 4,536 |  |  |  | (2,017 | ) |  |  |  |  |  |  | 1,363 |  |  |  | (1,426 | ) |  |  | 3 |
Net Investment Hedges |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Foreign exchange risk – Cross-currency swaps and foreign exchange forwards |  |  | – |  |  |  | (16 | ) |  |  |  |  |  |  | (5 | ) |  |  | 3 |  |  |  | (2 | )
Foreign exchange risk – Deposit liabilities |  |  | – |  |  |  | (22,750 | ) |  |  |  |  |  |  | (102 | ) |  |  | 102 |  |  |  | – |
Total |  | $ | 4,536 |  |  | $ | (24,783 | ) |  |  |  |  |  |  | $   1,256 |  |  |  | $    (1,321 | ) |  |  | $   1 |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 2024 |
|  | Carrying amount of hedging instruments (1) |  |  |  |  |  | Hedge ineffectiveness |  |  |  |
|  | Asset |  |  | Liability |  |  |  |  |  | Gains (losses) on hedging derivatives used to calculate hedge ineffectiveness (2) |  |  | Gains (losses) on hypothetical derivatives used to calculate hedge ineffectiveness (2) |  |  | Ineffectiveness recorded in non-interest revenue, other revenues |
Cash Flow Hedges |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest rate risk – Interest rate swaps |  | $ | 2,148 |  |  | $ | (915 | ) |  |  |  |  |  |  | $    3,552 |  |  |  | $   (3,615 | ) |  |  | $   (12 | )
Foreign exchange risk – Cross-currency swaps and foreign exchange forwards |  |  | 699 |  |  |  | (1,080 | ) |  |  |  |  |  |  | (251 | ) |  |  | 251 |  |  |  | – |
Equity price risk – Total return swaps |  |  | 63 |  |  |  | – |  |  |  |  |  |  |  | 165 |  |  |  | (165 | ) |  |  | – |
|  |  | 2,910 |  |  |  | (1,995 | ) |  |  |  |  |  |  | 3,466 |  |  |  | (3,529 | ) |  |  | (12 | )
Net Investment Hedges |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Foreign exchange risk – Cross-currency swaps and foreign exchange forwards |  |  | – |  |  |  | (4 | ) |  |  |  |  |  |  | (23 | ) |  |  | 19 |  |  |  | (4 | )
Foreign exchange risk – Deposit liabilities |  |  | – |  |  |  | (16,353 | ) |  |  |  |  |  |  | (119 | ) |  |  | 119 |  |  |  | – |
Total |  | $ | 2,910 |  |  | $ | (18,352 | ) |  |  |  |  |  |  | $   3,324 |  |  |  | $   (3,391 | ) |  |  | $   (16 | )
| (1) | Represents unrealized gains (losses) recorded as part of derivative instruments in assets and liabilities, respectively, in our Consolidated Balance Sheet.
| (2) | Represents life to date amounts.
The following tables provide a reconciliation of the impacts of our cash flow hedges and net investment hedges in our Consolidated Statement of Comprehensive Income, on a pre-tax basis for the years ended October 31, 2025 and 2024.
(Canadian $ in millions) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 2025 |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | Balance in cash flow hedge AOCI / net foreign operations AOCI |
|  | Balance October 31, 2024 |  |  | Gains / (losses) recognized in OCI |  |  | Amount reclassified to net income as the hedged item affects net income |  |  |  |  |  | Balance October 31, 2025 (1) (2) |  |  | Active hedges |  |  | Discontinued hedges |
Cash Flow Hedges |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest rate risk |  |  | $   (2,480 | ) |  | $ | 1,316 |  |  |  | $  1,600 |  |  |  |  |  |  |  | $    436 |  |  |  | $  2,453 |  |  |  | $   (2,017 | )
Foreign exchange risk |  |  | 357 |  |  |  | (214 | ) |  |  | (1 | ) |  |  |  |  |  |  | 142 |  |  |  | 142 |  |  |  | – |
Equity price risk |  |  | 77 |  |  |  | 258 |  |  |  | (151 | ) |  |  |  |  |  |  | 184 |  |  |  | 184 |  |  |  | – |
|  |  | (2,046 | ) |  |  | 1,360 |  |  |  | 1,448 |  |  |  |  |  |  |  | 762 |  |  |  | 2,779 |  |  |  | (2,017 | )
Net Investment Hedges |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Foreign exchange risk |  |  | (2,324 | ) |  |  | (105 | ) |  |  | – |  |  |  |  |  |  |  | (2,429 | ) |  |  | (2,429 | ) |  |  | – |
Total |  |  | $   (4,370 | ) |  | $ | 1,255 |  |  |  | $  1,448 |  |  |  |  |  |  |  | $  (1,667 | ) |  |  | $   350 |  |  |  | $   (2,017 | )
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 2024 |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | Balance in cash flow hedge AOCI / net foreign operations AOCI |
|  | Balance October 31, 2023 |  |  | Gains / (losses) recognized in OCI |  |  | Amount reclassified to net income as the hedged item affects net income |  |  |  |  |  | Balance October 31, 2024 (1) (2) |  |  | Active hedges |  |  | Discontinued hedges |
Cash Flow Hedges |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest rate risk |  |  | $   (8,015 | ) |  | $ | 3,564 |  |  |  | $  1,971 |  |  |  |  |  |  |  | $   (2,480 | ) |  |  | $  1,695 |  |  |  | $   (4,175 | )
Foreign exchange risk |  |  | 610 |  |  |  | (251 | ) |  |  | (2 | ) |  |  |  |  |  |  | 357 |  |  |  | 357 |  |  |  | – |
Equity price risk |  |  | (72 | ) |  |  | 165 |  |  |  | (16 | ) |  |  |  |  |  |  | 77 |  |  |  | 77 |  |  |  | – |
|  |  | (7,477 | ) |  |  | 3,478 |  |  |  | 1,953 |  |  |  |  |  |  |  | (2,046 | ) |  |  | 2,129 |  |  |  | (4,175 | )
Net Investment Hedges |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Foreign exchange risk |  |  | (2,186 | ) |  |  | (138 | ) |  |  | – |  |  |  |  |  |  |  | (2,324 | ) |  |  | (2,324 | ) |  |  | – |
Total |  |  | $   (9,663 | ) |  | $ | 3,340 |  |  |  | $  1,953 |  |  |  |  |  |  |  | $   (4,370 | ) |  |  | $   (195 | ) |  |  | $   (4,175 | )
| (1) | Tax balance related to cash flow hedges accumulated other comprehensive income was $(235) million as at October 31, 2025 ($527 million as at October 31, 2024).
| (2) | Tax balance related to net investment hedges accumulated other comprehensive income was $ 622 million as at October 31, 2025 ($593 million as at October 31, 2024).
Fair Value Hedges Fair value hedges modify exposure to changes in a fixed rate instrument’s fair value caused by changes in interest rates. These hedges economically convert fixed rate assets and liabilities to floating rate. We use cross-currency swaps, interest rate swaps and bond futures to hedge foreign exchange risk and interest rate risk, including benchmark interest rates inherent in fixed rate securities, a portfolio of mortgages, deposits and subordinated debt and other liabilities. The carrying value of fixed rate assets or liabilities that are part of a hedging relationship is adjusted for the change in value of the risk being hedged. To the extent that the change in the fair value of the derivative does not offset changes in the fair value of the hedged item for the risk being hedged, the net amount (hedge ineffectiveness) is recorded directly in non-interest revenue, other revenues, in our Consolidated Statement of Income. For fair value hedges that are discontinued, we cease adjusting the hedged item. The cumulative fair value adjustment of the hedged item is then amortized to net interest income over the hedged item’s remaining term to maturity. If the hedged item is sold or settled, the cumulative fair value adjustment is included in the gain or loss on sale or settlement. In our fair value hedge relationships, the main sources of ineffectiveness are our own credit risk on the fair value of the swap and differences in terms such as fixed interest rate or reset/settlement frequency between the swap and the hedged item. The amounts related to derivatives designated as fair value hedging instruments, hedged items and hedge ineffectiveness for the years ended October 31, 2025 and 2024 are as follows:
(Canadian $ in millions) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 2025 |
|  | Carrying amount of hedging derivatives (1) |  |  |  |  |  | Hedge ineffectiveness |  |  |  |  |  | Accumulated amount of fair value hedge gains (losses) on hedged items |
|  | Asset |  |  | Liability |  |  |  |  |  | Gains (losses) on hedging derivatives used to calculate hedge ineffectiveness |  |  | Gains (losses) on hedged item used to calculate hedge ineffectiveness |  |  | Ineffectiveness recorded in non-interest revenue, other revenues |  |  | Carrying amount of the hedged item (2) |  |  | Active hedges |  |  | Discontinued hedges |
Fair Value Hedge (3) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest rate swaps |  | $ | 786 |  |  | $ | (1,926 | ) |  |  |  |  |  |  | $       – |  |  |  | $         – |  |  |  | $       – |  |  |  | $         – |  |  |  | $      – |  |  |  | $         – |
Cross-currency swaps |  |  | – |  |  |  | – |  |  |  |  |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |
Securities and loans |  |  | – |  |  |  | – |  |  |  |  |  |  |  | (1,204 | ) |  |  | 1,170 |  |  |  | (34 | ) |  |  | 133,830 |  |  |  | 1,747 |  |  |  | (1,902 | )
Deposits, subordinated debt and other liabilities |  |  | – |  |  |  | – |  |  |  |  |  |  |  | 291 |  |  |  | (286 | ) |  |  | 5 |  |  |  | (77,224 | ) |  |  | (361 | ) |  |  | 429 |
Total |  | $ | 786 |  |  | $ | (1,926 | ) |  |  |  |  |  |  | $   (913 | ) |  |  | $    884 |  |  |  | $    (29 | ) |  |  | $   56,606 |  |  |  | $  1,386 |  |  |  | $    (1,473 | )
| (1) | Represents the unrealized gains (losses) within derivative instruments in assets and liabilities, respectively, in our Consolidated Balance Sheet.
| (2) | Represents the carrying value in our Consolidated Balance Sheet and includes amortized cost, before ACL, plus fair value hedge adjustments, except for FVOCI securities that are carried at fair value.
| (3) | Includes the fair value of bond futures rounded down to $nil million as at October 31, 2025.
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 2024 |
|  | Carrying amount of hedging derivatives (1) |  |  |  |  |  | Hedge ineffectiveness |  |  |  |  |  | Accumulated amount of fair value hedge gains (losses) on hedged items |
|  | Asset |  |  | Liability |  |  |  |  |  | Gains (losses) on hedging derivatives used to calculate hedge ineffectiveness |  |  | Gains (losses) on hedged item used to calculate hedge ineffectiveness |  |  | Ineffectiveness recorded in non-interest revenue, other revenues |  |  | Carrying amount of the hedged item (2) |  |  | Active hedges |  |  | Discontinued hedges |
Fair Value Hedge (3) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest rate swaps |  | $ | 1,464 |  |  | $ | (1,589 | ) |  |  |  |  |  | $ | – |  |  | $ | – |  |  | $ | – |  |  | $ | – |  |  | $ | – |  |  | $ | – |
Cross-currency swaps |  |  | – |  |  |  | (2 | ) |  |  |  |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |
Securities and loans |  |  | – |  |  |  | – |  |  |  |  |  |  |  | (3,266 | ) |  |  | 3,117 |  |  |  | (149 | ) |  |  | 118,397 |  |  |  | 741 |  |  |  | (1,293 | )
Deposits, subordinated debt and other liabilities |  |  | – |  |  |  | – |  |  |  |  |  |  |  | 1,234 |  |  |  | (1,217 | ) |  |  | 17 |  |  |  | (65,156 | ) |  |  | (214 | ) |  |  | 930 |
Total |  | $ | 1,464 |  |  | $ | (1,591 | ) |  |  |  |  |  | $ | (2,032 | ) |  | $ | 1,900 |  |  | $ | (132 | ) |  | $ | 53,241 |  |  | $ | 527 |  |  | $ | (363 | )
| (1) | Represents the unrealized gains (losses) within derivative instruments in assets and liabilities, respectively, in our Consolidated Balance Sheet.
| (2) | Represents the carrying value in our Consolidated Balance Sheet and includes amortized cost, before ACL, plus fair value hedge adjustments, except for FVOCI securities that are carried at fair value.
| (3) | Includes the fair value of bond futures rounded down to $nil million as at October 31, 2024.
Derivative-Related Market Risk Derivative instruments are subject to market risk arising from the potential for a negative impact on the balance sheet and/or statement of income due to adverse changes in the value of derivative instruments as a result of changes in certain market variables. These variables include interest rates, foreign exchange rates, credit spreads, equity and commodity prices and their implied volatilities. We strive to limit our exposure to market risk by employing comprehensive governance and management processes for all market risk-taking activities. Derivative-Related Credit Risk Derivative instruments are subject to credit risk arising from the possibility that counterparties may default on their obligations. The credit risk associated with a derivative normally represents an amount that is a small fraction of the notional amount of the derivative instrument. Derivative contracts generally expose us to potential credit loss if changes in market rates affect the counterparty’s position unfavourably and the counterparty defaults on payment. Credit risk is represented by the positive fair value of the derivative instrument. We strive to limit our exposure to credit risk by dealing with counterparties that we believe are creditworthy, and we manage our credit risk for derivatives using the same credit risk process that we apply to loans and other credit assets. We also pursue opportunities to reduce our exposure to credit losses on derivative instruments by securing collateral and entering into master netting agreements with counterparties. The credit risk associated with favourable contracts is mitigated by legally enforceable master netting agreements to the extent that unfavourable contracts with the same counterparty must be settled concurrently with favourable contracts. Exchange-traded derivatives have limited potential for credit risk exposure, as they are settled net daily with each exchange. Terms used in the credit risk tables below are as follows: Replacement cost captures the loss that would occur if a counterparty were to default in the present or at a future time, assuming that the closeout and replacement of transactions occur instantaneously, and assuming no recovery on the value of those transactions in bankruptcy. Credit risk equivalent represents the total replacement cost plus an amount representing the potential future credit risk exposure adjusted by a multiplier of 1.4, as outlined in OSFI’s Capital Adequacy Requirements (CAR) Guideline. Risk-weighted assets represent the credit risk equivalent, weighted on the basis of the creditworthiness of the counterparty and considering collateral, netting and other credit risk mitigants, as prescribed by OSFI.
(Canadian $ in millions) |  |  |  |  |  |  |  | 2025 |  |  |  |  |  |  |  |  | 2024 |
|  | Replacement cost (1) |  |  | Credit risk equivalent (1) |  |  | Risk-weighted assets |  |  | Replacement cost (1) |  |  | Credit risk equivalent (1) |  |  | Risk-weighted assets |
Interest Rate Contracts |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Over-the-counter |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Swaps |  | $ | 1,839 |  |  | $ | 7,493 |  |  | $ | 1,501 |  |  | $ | 2,404 |  |  | $ | 7,797 |  |  | $ | 1,125 |
Forward rate agreements |  |  | 391 |  |  |  | 3,448 |  |  |  | 858 |  |  |  | 650 |  |  |  | 2,696 |  |  |  | 600 |
Purchased options |  |  | 511 |  |  |  | 1,066 |  |  |  | 452 |  |  |  | 42 |  |  |  | 338 |  |  |  | 188 |
Written options |  |  | 8 |  |  |  | 245 |  |  |  | 66 |  |  |  | 2 |  |  |  | 211 |  |  |  | 78 |
|  |  | 2,749 |  |  |  | 12,252 |  |  |  | 2,877 |  |  |  | 3,098 |  |  |  | 11,042 |  |  |  | 1,991 |
Exchange-traded |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Futures |  |  | 9 |  |  |  | 49 |  |  |  | 1 |  |  |  | 122 |  |  |  | 279 |  |  |  | 6 |
Purchased options |  |  | 2 |  |  |  | 7 |  |  |  | – |  |  |  | 8 |  |  |  | 19 |  |  |  | – |
Written options |  |  | 2 |  |  |  | 5 |  |  |  | – |  |  |  | – |  |  |  | 1 |  |  |  | – |
|  |  | 13 |  |  |  | 61 |  |  |  | 1 |  |  |  | 130 |  |  |  | 299 |  |  |  | 6 |
Total interest rate contracts |  |  | 2,762 |  |  |  | 12,313 |  |  |  | 2,878 |  |  |  | 3,228 |  |  |  | 11,341 |  |  |  | 1,997 |
Foreign Exchange Contracts (2) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Over-the-counter |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Swaps |  |  | 1,927 |  |  |  | 8,407 |  |  |  | 779 |  |  |  | 1,559 |  |  |  | 7,218 |  |  |  | 825 |
Forward foreign exchange contracts |  |  | 1,838 |  |  |  | 9,399 |  |  |  | 1,672 |  |  |  | 2,709 |  |  |  | 9,643 |  |  |  | 1,764 |
Purchased options |  |  | 119 |  |  |  | 476 |  |  |  | 139 |  |  |  | 142 |  |  |  | 447 |  |  |  | 142 |
Written options |  |  | 1 |  |  |  | 155 |  |  |  | 38 |  |  |  | 1 |  |  |  | 119 |  |  |  | 27 |
|  |  | 3,885 |  |  |  | 18,437 |  |  |  | 2,628 |  |  |  | 4,411 |  |  |  | 17,427 |  |  |  | 2,758 |
Exchange-traded |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Futures |  |  | – |  |  |  | 1 |  |  |  | – |  |  |  | – |  |  |  | 1 |  |  |  | – |
Purchased options |  |  | – |  |  |  | 2 |  |  |  | – |  |  |  | – |  |  |  | 3 |  |  |  | – |
|  |  | – |  |  |  | 3 |  |  |  | – |  |  |  | – |  |  |  | 4 |  |  |  | – |
Total foreign exchange contracts |  |  | 3,885 |  |  |  | 18,440 |  |  |  | 2,628 |  |  |  | 4,411 |  |  |  | 17,431 |  |  |  | 2,758 |
Commodity Contracts |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Over-the-counter |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Swaps |  |  | 1,165 |  |  |  | 4,822 |  |  |  | 1,228 |  |  |  | 993 |  |  |  | 4,256 |  |  |  | 1,035 |
Purchased options |  |  | 205 |  |  |  | 688 |  |  |  | 308 |  |  |  | 155 |  |  |  | 484 |  |  |  | 182 |
Written options |  |  | 4 |  |  |  | 366 |  |  |  | 140 |  |  |  | 10 |  |  |  | 246 |  |  |  | 86 |
|  |  | 1,374 |  |  |  | 5,876 |  |  |  | 1,676 |  |  |  | 1,158 |  |  |  | 4,986 |  |  |  | 1,303 |
Exchange-traded |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Futures |  |  | 246 |  |  |  | 1,028 |  |  |  | 21 |  |  |  | 176 |  |  |  | 594 |  |  |  | 12 |
Purchased options |  |  | 28 |  |  |  | 178 |  |  |  | 4 |  |  |  | 179 |  |  |  | 319 |  |  |  | 6 |
Written options |  |  | 15 |  |  |  | 157 |  |  |  | 3 |  |  |  | – |  |  |  | 73 |  |  |  | 1 |
|  |  | 289 |  |  |  | 1,363 |  |  |  | 28 |  |  |  | 355 |  |  |  | 986 |  |  |  | 19 |
Total commodity contracts |  |  | 1,663 |  |  |  | 7,239 |  |  |  | 1,704 |  |  |  | 1,513 |  |  |  | 5,972 |  |  |  | 1,322 |
Equity Contracts |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Over-the-counter |  |  | 306 |  |  |  | 10,247 |  |  |  | 2,132 |  |  |  | 199 |  |  |  | 8,625 |  |  |  | 1,645 |
Exchange-traded |  |  | 2,036 |  |  |  | 3,909 |  |  |  | 78 |  |  |  | 675 |  |  |  | 2,899 |  |  |  | 58 |
Total equity contracts |  |  | 2,342 |  |  |  | 14,156 |  |  |  | 2,210 |  |  |  | 874 |  |  |  | 11,524 |  |  |  | 1,703 |
Credit Contracts |  |  | 24 |  |  |  | 177 |  |  |  | 22 |  |  |  | 103 |  |  |  | 309 |  |  |  | 39 |
Total |  | $ | 10,676 |  |  | $ | 52,325 |  |  | $ | 9,442 |  |  | $ | 10,129 |  |  | $ | 46,577 |  |  | $ | 7,819 |
| (1) | Replacement cost and credit risk equivalent are presented after the impact of master netting agreements and calculated using the Standardized Approach for Counterparty Credit Risk (SA-CCR) in accordance with the CAR Guideline issued by OSFI. Th is table therefore excludes loan commitment derivatives.
| (2) | Gold contracts are included in foreign exchange contracts.
Term to Maturity Our derivative contracts have varying maturity dates. The remaining contractual terms to maturity for the notional amounts of our derivative contracts are as follows:
(Canadian $ in millions) |  |  |  |  | Term to maturity |  |  | 2025 |  |  | 2024 |
|  |  |  |  | Within 1 year |  |  | 1 to 3 years |  |  | 3 to 5 years |  |  | 5 to 10 years |  |  | Over 10 years |  |  | Total notional amounts |  |  | Total notional amounts |
Interest Rate Contracts |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Swaps |  |  |  |  |  | $ | 4,452,781 |  |  | $ | 4,418,207 |  |  | $ | 2,451,659 |  |  | $ | 2,271,601 |  |  | $ | 1,065,819 |  |  | $ | 14,660,067 |  |  | $ | 16,845,977 |
Forward rate agreements, futures and options |  |  |  |  |  |  | 2,435,842 |  |  |  | 937,140 |  |  |  | 123,894 |  |  |  | 17,334 |  |  |  | 4,232 |  |  |  | 3,518,442 |  |  |  | 5,824,049 |
Total interest rate contracts |  |  |  |  |  |  | 6,888,623 |  |  |  | 5,355,347 |  |  |  | 2,575,553 |  |  |  | 2,288,935 |  |  |  | 1,070,051 |  |  |  | 18,178,509 |  |  |  | 22,670,026 |
Foreign Exchange Contracts (1) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Swaps |  |  |  |  |  |  | 349,612 |  |  |  | 447,928 |  |  |  | 271,998 |  |  |  | 224,379 |  |  |  | 77,590 |  |  |  | 1,371,507 |  |  |  | 1,002,323 |
Forward foreign exchange contracts |  |  |  |  |  |  | 903,972 |  |  |  | 27,903 |  |  |  | 4,423 |  |  |  | 1,336 |  |  |  | 3,006 |  |  |  | 940,640 |  |  |  | 679,927 |
Futures |  |  |  |  |  |  | 10,616 |  |  |  | 248 |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 10,864 |  |  |  | 1,751 |
Options |  |  |  |  |  |  | 194,461 |  |  |  | 21,524 |  |  |  | 2,089 |  |  |  | 332 |  |  |  | – |  |  |  | 218,406 |  |  |  | 171,606 |
Total foreign exchange contracts |  |  |  |  |  |  | 1,458,661 |  |  |  | 497,603 |  |  |  | 278,510 |  |  |  | 226,047 |  |  |  | 80,596 |  |  |  | 2,541,417 |  |  |  | 1,855,607 |
Commodity Contracts |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Swaps |  |  |  |  |  |  | 15,030 |  |  |  | 6,088 |  |  |  | 601 |  |  |  | 409 |  |  |  | – |  |  |  | 22,128 |  |  |  | 20,328 |
Futures |  |  |  |  |  |  | 24,278 |  |  |  | 12,212 |  |  |  | 1,492 |  |  |  | 488 |  |  |  | – |  |  |  | 38,470 |  |  |  | 36,071 |
Options |  |  |  |  |  |  | 44,932 |  |  |  | 16,512 |  |  |  | 308 |  |  |  | 1,000 |  |  |  | – |  |  |  | 62,752 |  |  |  | 99,134 |
Total commodity contracts |  |  |  |  |  |  | 84,240 |  |  |  | 34,812 |  |  |  | 2,401 |  |  |  | 1,897 |  |  |  | – |  |  |  | 123,350 |  |  |  | 155,533 |
Equity Contracts |  |  |  |  |  |  | 354,512 |  |  |  | 65,709 |  |  |  | 17,852 |  |  |  | 5,796 |  |  |  | 663 |  |  |  | 444,532 |  |  |  | 471,640 |
Credit Contracts |  |  |  |  |  |  | 2,240 |  |  |  | 15,860 |  |  |  | 26,136 |  |  |  | 9,698 |  |  |  | 1,333 |  |  |  | 55,267 |  |  |  | 39,561 |
Total notional amount |  |  |  |  |  | $ | 8,788,276 |  |  | $ | 5,969,331 |  |  | $ | 2,900,452 |  |  | $ | 2,532,373 |  |  | $ | 1,152,643 |  |  | $ | 21,343,075 |  |  | $ | 25,192,367 |
| (1) | Gold contracts are included in foreign exchange contracts.
Under the SA-CCR, this table excludes loan commitment derivatives.

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