By Rita Trichur
Toronto-Dominion Bank on Thursday posted an 8% increase in its
fiscal fourth-quarter earnings, largely on improved results from
its Canadian retail and wholesale banking divisions, but the bank
missed analyst expectations and warned of more challenging
operating conditions in 2015.
TD, Canada's biggest bank by assets, earned 1.75 billion
Canadian dollars ($1.54 billion), or 91 Canadian cents a share for
the three months ended Oct. 31, up from C$1.62 billion, or 84
Canadian cents a share, a year earlier.
Earnings for the quarter were affected by items, including the
amortization of intangibles, that amounted to C$62 million, and
C$54 million of integration charges for TD's acquisition of MBNA
Canada's credit-card portfolio.
Adjusted to strip out extraordinary items, earnings rose 3% to
C$1.86 billion, or 98 Canadian cents a share. Analysts polled by
Thomson Reuters were expecting a profit of C$1.05 a share.
"We are pleased to finish out the year with strong total
adjusted earnings," said newly-minted Chief Executive Bharat
Masrani, who replaced Ed Clark, TD's former CEO, in the top job on
Nov. 1.
"As we look ahead to 2015, we expect the operating environment
to be more challenging. We will focus on organic growth, delivering
legendary experiences across every channel, and increasing
productivity while investing for the future," Mr. Masrani said.
Adjusted earnings from the bank's Canadian retail division rose
7% in the quarter. Loan and deposit growth, along with higher
wealth assets under management, partly offset higher expenses in
the division. TD's U.S. retail unit, meanwhile, recorded flat
earnings on an adjusted basis, even as expenses fell.
Looking ahead, the bank warned that it is expecting "moderated
earnings growth" in fiscal 2015 due to a "more challenging
operating environment" for its mainstay domestic retail bank.
Similarly, the U.S. retail unit will likely only experience "modest
earnings growth" in 2015, TD said.
The bank, which posted a 31% increase in wholesale net earnings,
left its quarterly dividend unchanged at 47 Canadian cents.
Earlier Thursday, smaller rival Canadian Imperial Bank of
Commerce, this country's No. 5 lender, reported a fourth-quarter
profit that slipped nearly 2%, falling just shy expectations.
CIBC and TD are the third and fourth banks to report
fourth-quarter earnings. Bank of Nova Scotia, which is Canada's
third-largest lender, will wrap up earnings season for the "Big
Five" lenders on Friday.
Write to Rita Trichur at rita.trichur@wsj.com
Access Investor Kit for Canadian Imperial Bank of Commerce
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=CA1360691010
Access Investor Kit for The Toronto-Dominion Bank
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=CA8911605092
Access Investor Kit for Bank of America Corp.
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=US0605051046
Subscribe to WSJ: http://online.wsj.com?mod=djnwires