TD wraps up bank earnings on high note

TORONTO — TD Bank Group wrapped up a bullish third-quarter earnings season for Canada’s biggest lenders Thursday with a profit of nearly $3.11 billion, a 12 per cent increase from last year that was supported by growth at its U.S. business and a strong domestic economy.

“While we continue to see pockets of market uncertainty stemming from the geopolitical climate, both the Canadian and U.S. economies continue to perform well and support a positive outlook for our diversified businesses across the bank as we head into the final stretch of the year,” said TD chief executive Bharat Masrani.

That message echoed positive comments from the CEOs of Canada’s other big banks during the past two weeks, as they reported increased profit at their main domestic operations.

Except for Bank of Nova Scotia, which saw a year-over-year decline in profit due to its international banking arm, all of the five biggest banks showed robust overall profit growth from last year. In total, Canada’s five biggest banks reported $11.06 billion of net income for the three months ended July 31, about nine per cent above last year’s third quarter.

TD Bank and Royal Bank were tied for top spot, with just under $3.11 billion in net income each.

TD’s third-quarter net income amounted to $1.65 per diluted share, up from $2.77 billion or $1.46 per share last year.

On an adjusted basis, TD earned $1.66 per diluted share, an increase from an adjusted profit of $1.51 per diluted share a year ago.

Analysts on average had expected TD to report a profit of $1.63 per share, according to Thomson Reuters Eikon.

TD’s Canadian retail business earned $1.85 billion for the quarter, up from nearly $1.73 billion a year ago helped by revenue growth, partially offset by higher insurance claims and non-interest expenses.

Meanwhile, TD’s U.S. retail business earned $1.14 billion, up from $901 million in the same quarter last year, helped by loan and deposit volume growth, higher margins and benefits from U.S. tax reform. The wholesale banking division earned $223 million this quarter, down from $293 million a year ago.

The bank’s common equity tier 1 ratio — a key measure of financial health — was 11.7 per cent compared with 11.0 per cent a year ago.