TD Bank releases Q2 2017 financial results

April 29, 2017
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TD Bank releases Q2 2017 financial results

SECOND QUARTER FINANCIAL HIGHLIGHTS, compared with the second quarter last year:

Reported diluted earnings per share were $1.31, compared with $1.07.
Adjusted diluted earnings per share were $1.34, compared with $1.20.
Reported net income was $2,503 million, compared with $2,052 million.
Adjusted net income was $2,561 million, compared with $2,282 million.

YEAR-TO-DATE FINANCIAL HIGHLIGHTS, six months ended April 30, 2017, compared with the corresponding period last year:

Reported diluted earnings per share were $2.63, compared with $2.24.
Adjusted diluted earnings per share were $2.67, compared with $2.38.
Reported net income was $5,036 million, compared with $4,275 million.
Adjusted net income was $5,119 million, compared with $4,529 million.

SECOND QUARTER ADJUSTMENTS (ITEMS OF NOTE)
The second quarter reported earnings figures included the following items of note:

Amortization of intangibles of $78 million ($58 million after tax or 3 cents per share), compared with $86 million ($63 million after tax or 4 cents per share) in the second quarter last year.

TD Bank Group announced its financial results for the second quarter ended April 30, 2017. Second quarter reported earnings were $2.5 billion, up 22% compared with the same quarter last year. "All of our business segments performed well in the second quarter reflecting strong revenue growth and reduced credit losses," said Bharat Masrani, Group President and Chief Executive Officer. "Our relentless focus on improving TD's legendary customer experience continues to deliver increased volumes and new customer acquisitions."

Canadian Retail

Canadian Retail net income was $1,570 million, an increase of 7% from the same quarter last year reflecting strong volume growth led by record average balances and accounts in core chequing, strong growth across commercial loans and deposits and market share gains in wealth assets, along with reduced loan losses. Increased non-interest expenses this quarter relate to ongoing investments in digitizing the customer experience and enhancing product offerings.

TD also commented on the status of its review of sales practices in Canadian personal banking. "At TD, we share a commitment to continually improve for our customers and our colleagues, and we welcomed this review as an opportunity to help make us better. We have largely completed this review and we continue to believe that we do not have a widespread problem with people acting unethically in order to achieve sales goals. As we have indicated, we will act on the opportunities we found to improve our business," said Masrani. This topic will also be considered by industry regulators and TD is committed to engaging cooperatively.

U.S. Retail

U.S. Retail net income was $845 million (US$636 million) this quarter compared with $719 million (US$537 million) for the second quarter last year, an increase of 18%.

The U.S. Retail Bank, which excludes the Bank's investment in TD Ameritrade, generated net income of $737 million (US$554 million), an increase of 21% compared with the second quarter last year. The U.S. Retail Bank's focus on deepening relationships with existing customers and on new customer acquisition delivered higher volumes and contributed to strong revenue growth. The earnings also reflect a more favourable interest rate environment, continuing good credit performance, and expense management.

TD Ameritrade contributed $108 million (US$82 million) in earnings to the segment, same as the second quarter last year (an increase of 5% in U.S. dollars).

Wholesale Banking

Wholesale Banking net income was $248 million, an increase of 13% compared with the second quarter last year reflecting strong revenue growth from higher corporate lending fees, increased client activity in equity trading and lower credit losses. Higher non-interest expenses include continued investments to grow our U.S. businesses.

Capital

TD's Common Equity Tier 1 Capital ratio on a Basel III fully phased-in basis was 10.8%, compared with 10.9% last quarter, reflecting strong organic capital generation and the normal course issuer bid completed this quarter.

Conclusion

"At the half-year mark, we continue to execute against our strategy and I am very pleased with our earnings growth and the performance of our retail and wholesale franchises," said Masrani. "We remain focused on investing for future growth and seamlessly delivering personalized experiences, proactive advice and timely interactions to our customers and clients across multiple channels, anywhere and anytime."

Re-disseminated by The Asian Banker