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Toronto-Dominion Profit Falls on Trading Revenue

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Dec. 2 (Bloomberg) -- Toronto-Dominion Bank, Canada’s second-largest bank, said profit fell 1.6 percent on a decline in trading and underwriting fees.

Net income for the period ended Oct. 31 dropped to C$994 million ($980 million), or C$1.07 a share, from C$1.01 billion, or C$1.12, a year earlier, the Toronto-based bank said today in a statement.

Profit at the investment-banking unit fell 74 percent to C$95 million on reduced equity and fixed-income trading, and lower underwriting fees.

Before one-time items, Toronto-Dominion said it earned C$1.38 a share. That missed the C$1.46-a-share average estimate of 16 analysts surveyed by Bloomberg News.

Toronto-Dominion rose 60 cents to C$75.29 in trading yesterday on the Toronto Stock Exchange. The shares have climbed 14 percent this year, compared with an 8.9 increase for the 10-member S&P/TSX Banks Index.

Canadian consumer banking profit climbed 24 percent to C$773 million on higher volumes in banking, financing and real estate lending.

“They focus very, very well on retail banking, and that’s where the margins are,” said Tony Demarin, chief investment officer of BCV Asset Management in Winnipeg, Manitoba, which manages about C$230 million, including Toronto-Dominion shares.

U.S. Earnings

U.S. consumer banking profit more than doubled to C$265 million. Chief Executive Officer Edmund Clark has said he expects the bank to earn $1.6 billion a year from its U.S. operations within three years. The bank now has more U.S. branches than it does in Canada.

“We’ve moved ourselves into a position where we have a sustainable position,” in the U.S., Clark said in an October interview. “We now have a management team in place, enough presence to say ‘okay, we’ve got a base where we can grow here’.”

For the full year, Toronto-Dominion earned C$4.64 billion, up from C$3.12 billion a year ago.

(Toronto-Dominion will hold a conference call at 3 p.m. local time to discuss results. To listen, dial +1-416-644-3414 or +1-877-974-0445, or visit www.td.com/investor/qr_2010.jsp on the Internet.)

To contact the reporter on this story: Sean B. Pasternak in Toronto at spasternak@bloomberg.net.

To contact the editors responsible for this story: David Scanlan at dscanlan@bloomberg.net; or dscanlan@bloomberg.net; David Scheer at dscheer@bloomberg.net.