TD Bank Profit Climbs 10%

Toronto-Dominion Bank on Thursday reported a better-than-expected 10% increase in its fiscal second-quarter profit, helped by stronger earnings from its retail operations in both Canada and the U.S.

Canada's second-largest lender by assets beat analyst expectations for the February-to-April quarter even as the amount set aside to cover bad loans climbed 56% from a year earlier.

Toronto-based TD had a fiscal second-quarter profit of 2.05 billion Canadian dollars ($1.57 billion), or C$1.07 a share, up from C$1.86 billion, or 97 Canadian cents a share, a year earlier.

Excluding items, the bank said its adjusted earnings totaled C$1.20 a share, which was ahead of the C$1.16 a share analysts polled by Thomson Reuters expected.

Loan-loss provisions, or funds set aside to cover soured loans, rose to C$584 million from C$375 million a year earlier. On a quarter-over-quarter basis, loan-loss provisions were down 9% from C$642 million.

TD said earnings from its Canadian retail banking division were up 2% from a year earlier, while U.S. retail earnings were up 15%. Wholesale banking results fell 11%, which the bank attributed to higher credit provisions.

"Our performance this quarter demonstrates our diversified business strategy and ability to generate strong organic growth," Chief Executive Bharat Masrani said in a release.

TD maintained its quarterly dividend at 55 Canadian cents per share.

TD's second-quarter beat follows stronger-than-expected quarterly results from peers Royal Bank of Canada and Canadian Imperial Bank of Commerce earlier on Thursday. Bank of Montreal kicked off earnings season on Wednesday with a lower-than-expected profit. Bank of Nova Scotia will close out earnings season for the banks on May 31.

Write to Judy McKinnon at [e-mail]

(END) Dow Jones Newswires

May 26, 2016 08:25 ET (12:25 GMT)

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