Form
20-F o
|
Form
40-F x
|
Yes
o
|
No
x
|
THE
TORONTO-DOMINION BANK
|
|||
DATE: May
25, 2006
|
By:
|
/s/
Rasha El Sissi
|
|
Name:
|
Rasha
El Sissi
|
||
Title:
|
Associate
Vice President, Legal
|
|
Bank Financial Group |
2nd
Quarter 2006 •
Report to Shareholders •
Three
and six months ended April 30,
2006
|
TD
Bank
Financial Group Delivers Solid
Second
Quarter 2006
Results
|
•
|
Reported
diluted earnings per share1
were $1.01, up 17% from $.86.
|
•
|
Adjusted
diluted earnings per share2
were $1.09, up 9% from $1.00.
|
•
|
Reported
net income was $738 million, compared with $599 million.
|
•
|
Adjusted
net income was $780 million, compared with $672 million.
|
•
|
Amortization
of intangibles of $86 million after-tax (11 cents per share), compared
with $90 million after-tax (13 cents per share) in the second quarter
last
year.
|
•
|
The
impact of hedging relationships accounting guideline (AcG-13) resulting
in
a gain of $10 million after-tax (1 cent per share), compared with
a gain
of $33 million after-tax (5 cents per share).
|
•
|
A
general loan loss provision release of $39 million after-tax (5
cents per
share).
|
•
|
A
reduction to the TD Ameritrade dilution gain of $5 million (1 cent
per
share) due to final adjustments to the purchase and sale price.
|
•
|
The
diluted earnings per share figures above do not include the Bank’s equity
interest in the April 2006 results of TD Ameritrade because there
is a one
month lag between fiscal quarter ends. The results of the Bank
include its
equity share in TD Ameritrade from January 25, 2006 to March 31,
2006. As
a result of the one month lag, the impact on earnings per share
was
approximately 2 cents per share. This effect will not repeat in
future
quarters.
|
1
|
Reported
results are prepared in accordance with Canadian generally accepted
accounting principles (GAAP).
|
2
|
Adjusted
earnings and reported results referenced in this Press Release
and the
Report to Shareholders are explained in detail on page 5 under
the “How
the Bank Reports” section. Commencing from the first quarter 2006, the
items of note include the Bank’s amortization of intangible assets.
Previously, the Bank described adjusted
earnings as earnings before amortization of intangibles and items
of note.
|
TD
BANK
FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
2
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
3
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
4
|
(unaudited)
|
||||||||||||||||
|
For
the three months ended
|
For
the six months ended
|
||||||||||||||
April
30
|
January
31
|
April
30
|
April
30
|
April
30
|
||||||||||||
(millions
of Canadian dollars, except as noted)
|
2006
|
2006
|
2005
|
2006
|
2005
|
|||||||||||
Results
of operations
|
||||||||||||||||
Total
revenues
|
$
|
3,118
|
$
|
3,404
|
$
|
2,910
|
$
|
6,522
|
$
|
5,716
|
||||||
Dilution
gain, net
|
(5
|
)
|
1,564
|
-
|
1,559
|
-
|
||||||||||
Provision
for credit losses
|
16
|
114
|
20
|
130
|
30
|
|||||||||||
Non-interest
expenses
|
2,103
|
2,290
|
2,057
|
4,393
|
4,002
|
|||||||||||
Net
income - reported
|
738
|
2,307
|
599
|
3,045
|
1,229
|
|||||||||||
Net
income - adjusted1
|
780
|
835
|
672
|
1,615
|
1,357
|
|||||||||||
Economic
profit2
|
271
|
353
|
242
|
629
|
518
|
|||||||||||
Return
on common equity
|
16.5
|
%
|
55.4
|
%
|
17.2
|
%
|
35.5
|
%
|
18.2
|
%
|
||||||
Return
on invested capital2
|
14.6
|
%
|
16.5
|
%
|
15.8
|
%
|
15.6
|
%
|
16.3
|
%
|
||||||
Financial
position
|
||||||||||||||||
Total
assets
|
$
|
388,596
|
$
|
384,377
|
$
|
359,544
|
$
|
388,596
|
$
|
359,544
|
||||||
Total
risk-weighted assets
|
135,763
|
135,883
|
127,599
|
135,763
|
127,599
|
|||||||||||
Total
shareholders’ equity
|
19,283
|
18,473
|
15,592
|
19,283
|
15,592
|
|||||||||||
Financial
ratios - reported (percent)
|
||||||||||||||||
Efficiency
ratio
|
67.6
|
%
|
46.1
|
%
|
70.7
|
%
|
54.4
|
%
|
70.0
|
%
|
||||||
Tier
1 capital to risk-weighted assets
|
12.1
|
11.9
|
10.0
|
12.1
|
10.0
|
|||||||||||
Tangible
common equity as a % of risk-weighted assets
|
9.0
|
8.8
|
6.9
|
9.0
|
6.9
|
|||||||||||
Provision
for credit losses as a % of net average loans
|
.04
|
.29
|
.06
|
.16
|
.04
|
|||||||||||
Common
share information - reported (Canadian
dollars)
|
||||||||||||||||
Per
share
|
||||||||||||||||
Basic
earnings
|
$
|
1.02
|
$
|
3.23
|
$
|
.87
|
$
|
4.25
|
$
|
1.83
|
||||||
Diluted
earnings
|
1.01
|
3.20
|
.86
|
4.21
|
1.81
|
|||||||||||
Dividends
|
.44
|
.42
|
.40
|
.86
|
.76
|
|||||||||||
Book
value
|
26.24
|
25.25
|
22.06
|
26.24
|
22.06
|
|||||||||||
Closing
share price
|
62.45
|
60.65
|
50.34
|
62.45
|
50.34
|
|||||||||||
Shares
outstanding (millions)
|
||||||||||||||||
Average
basic
|
715.7
|
712.5
|
690.8
|
714.1
|
673.4
|
|||||||||||
Average
diluted
|
722.5
|
718.9
|
696.1
|
720.7
|
678.7
|
|||||||||||
End
of
period
|
718.8
|
714.7
|
706.7
|
718.8
|
706.7
|
|||||||||||
Market
capitalization (billions of Canadian dollars)
|
$
|
44.9
|
$
|
43.3
|
$
|
35.6
|
$
|
44.9
|
$
|
35.6
|
||||||
Dividend
yield
|
2.6
|
%
|
2.8
|
%
|
2.9
|
%
|
2.7
|
%
|
3.0
|
%
|
||||||
Dividend
payout ratio
|
43.0
|
%
|
13.0
|
%
|
46.9
|
%
|
20.3
|
%
|
42.1
|
%
|
||||||
Price
to earnings multiple
|
11.1
|
11.1
|
14.1
|
11.1
|
14.1
|
|||||||||||
Common
share information - adjusted
(Canadian dollars)
|
||||||||||||||||
Per
share
|
||||||||||||||||
Basic
earnings
|
$
|
1.10
|
$
|
1.16
|
$
|
1.00
|
$
|
2.27
|
$
|
2.05
|
||||||
Diluted
earnings
|
1.09
|
1.15
|
1.00
|
2.25
|
2.03
|
|||||||||||
Dividend
payout ratio
|
40.7
|
%
|
36.1
|
%
|
41.8
|
%
|
38.3
|
%
|
38.1
|
%
|
||||||
Price
to earnings multiple
|
14.4
|
14.3
|
13.0
|
14.4
|
13.0
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
5
|
Operating
results - reported (unaudited)
|
||||||||||||||||
For
the three months ended
|
For
the six months ended
|
|||||||||||||||
April
30
|
January
31
|
April
30
|
April
30
|
April
30
|
||||||||||||
(millions
of
Canadian dollars)
|
2006
|
2006
|
2005
|
2006
|
2005
|
|||||||||||
Net
interest income
|
$
|
1,427
|
$
|
1,607
|
$
|
1,393
|
$
|
3,034
|
$
|
2,804
|
||||||
Other
income
|
1,691
|
1,797
|
1,517
|
3,488
|
2,912
|
|||||||||||
Total
revenues
|
3,118
|
3,404
|
2,910
|
6,522
|
5,716
|
|||||||||||
Dilution
gain (loss), net
|
(5
|
)
|
1,564
|
-
|
1,559
|
-
|
||||||||||
Provision
for credit losses
|
16
|
114
|
20
|
130
|
30
|
|||||||||||
Non-interest
expenses
|
2,103
|
2,290
|
2,057
|
4,393
|
4,002
|
|||||||||||
Income
before provision for income taxes, non-controlling interests in
subsidiaries and equity in net income of associated
company
|
994
|
2,564
|
833
|
3,558
|
1,684
|
|||||||||||
Provision
for income taxes
|
244
|
220
|
213
|
464
|
434
|
|||||||||||
Non-controlling
interests, net of tax
|
47
|
37
|
21
|
84
|
21
|
|||||||||||
Equity
in net income of associated company, net of tax
|
35
|
-
|
-
|
35
|
-
|
|||||||||||
Net
income - reported
|
738
|
2,307
|
599
|
3,045
|
1,229
|
|||||||||||
Preferred
dividends
|
6
|
5
|
-
|
11
|
-
|
|||||||||||
Net
income available to common shareholders -
reported
|
$
|
732
|
$
|
2,302
|
$
|
599
|
$
|
3,034
|
$
|
1,229
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
6
|
Adjusted
net income to reported results
|
||||||||||||||||
Operating
results - adjusted
|
||||||||||||||||
For
the three months ended
|
For
the
six months ended4
|
|||||||||||||||
April
30
|
January
31
|
April
30
|
April
30
|
April
30
|
||||||||||||
(millions
of Canadian dollars)
|
2006
|
2006
|
2005
|
2006
|
2005
|
|||||||||||
Net
interest income
|
$
|
1,427
|
$
|
1,607
|
$
|
1,393
|
$
|
3,034
|
$
|
2,804
|
||||||
Other
income
|
1,675
|
1,834
|
1,466
|
3,509
|
2,877
|
|||||||||||
Total
revenues
|
3,102
|
3,441
|
2,859
|
6,543
|
5,681
|
|||||||||||
Provision
for credit losses
|
76
|
114
|
63
|
190
|
143
|
|||||||||||
Non-interest
expenses
|
1,978
|
2,112
|
1,901
|
4,090
|
3,712
|
|||||||||||
Income
before provision for income taxes, non-controlling interests in
subsidiaries and equity in net income of associated
company
|
1,048
|
1,215
|
895
|
2,263
|
1,826
|
|||||||||||
Provision
for income taxes
|
260
|
328
|
202
|
588
|
448
|
|||||||||||
Non-controlling
interests, net of tax
|
50
|
52
|
21
|
102
|
21
|
|||||||||||
Equity
in net income of associated company, net of tax
|
42
|
-
|
-
|
42
|
-
|
|||||||||||
Net
income - adjusted
|
780
|
835
|
672
|
1,615
|
1,357
|
|||||||||||
Preferred
dividends
|
6
|
5
|
-
|
11
|
-
|
|||||||||||
Net
income available to common shareholders -
adjusted
|
$
|
774
|
$
|
830
|
$
|
672
|
$
|
1,604
|
$
|
1,357
|
||||||
Items
of note affecting net income, net of income taxes
|
||||||||||||||||
Amortization
of intangibles2
|
$
|
(86
|
)
|
$
|
(82
|
)
|
$
|
(90
|
)
|
$
|
(168
|
)
|
$
|
(177
|
)
|
|
Dilution
gain on Ameritrade transaction, net of costs
|
(5
|
)
|
1,670
|
-
|
1,665
|
-
|
||||||||||
Dilution
loss on the acquisition of Hudson United by TD Banknorth
|
-
|
(72
|
)
|
-
|
(72
|
)
|
-
|
|||||||||
Balance
sheet restructuring charge in TD Banknorth
|
-
|
(19
|
)
|
-
|
(19
|
)
|
-
|
|||||||||
Wholesale
Banking restructuring charge
|
-
|
(35
|
)
|
(15
|
)
|
(35
|
)
|
(15
|
)
|
|||||||
Hedging
impact due to AcG-13
|
10
|
10
|
33
|
20
|
22
|
|||||||||||
General
allowance release
|
39
|
-
|
-
|
39
|
23
|
|||||||||||
Other
tax items
|
-
|
-
|
(25
|
)
|
-
|
(25
|
)
|
|||||||||
Non-core
portfolio loan loss recoveries (sectoral related)
|
-
|
-
|
24
|
-
|
44
|
|||||||||||
Total
items of note
|
(42
|
)
|
1,472
|
(73
|
)
|
1,430
|
(128
|
)
|
||||||||
Net
income available to common shareholders -
reported
|
$
|
732
|
$
|
2,302
|
$
|
599
|
$
|
3,034
|
$
|
1,229
|
For
the three months ended
|
For
the six months ended
|
|||||||||||||||
April
30
|
January
31
|
April
30
|
April
30
|
April
30
|
||||||||||||
(Canadian
dollars)
|
2006
|
2006
|
2005
|
2006
|
2005
|
|||||||||||
Diluted
- reported
|
$
|
1.01
|
$
|
3.20
|
$
|
.86
|
$
|
4.21
|
$
|
1.81
|
||||||
Items
of note affecting income (as above)
|
.06
|
(2.05
|
)
|
.11
|
(1.98
|
)
|
.19
|
|||||||||
Items
of note affecting EPS only5
|
.02
|
-
|
.03
|
.02
|
.03
|
|||||||||||
Diluted
- adjusted
|
1.09
|
1.15
|
1.00
|
2.25
|
2.03
|
|||||||||||
Basic
- reported
|
$
|
1.02
|
$
|
3.23
|
$
|
.87
|
$
|
4.25
|
$
|
1.83
|
1.
|
Certain
comparative amounts have been restated to conform to the presentation
adopted in the current period.
|
2.
|
See
additional
information in the “Amortization of Intangibles, net of income taxes”
table below.
|
3.
|
Earnings
per share (EPS) is computed by dividing income by the weighted average
number of shares outstanding during the period. As a result, the
sum of
the quarterly EPS figures may not equal year-to-date
EPS.
|
4.
|
Items
of note in addition to those included in the second quarter of 2006
and
2005 are as follows: first quarter 2005 - amortization of intangibles-$87
million; non-core portfolio loan loss recoveries (sectoral related)-$20
million; hedging impact due to AcG-13-($11) million; and $23 million
relating to general allowance release; first quarter 2006 - amortization
of intangibles-$82 million; dilution gain of U.S. $1.45 billion ($1.67
billion) on the Ameritrade transaction net of costs; dilution loss
of $72
million on the acquisition of Hudson United Bancorp by TD Banknorth;
the
Bank’s share of TD Banknorth’s balance sheet restructuring charge of U.S.
$16 million ($19 million); restructuring charge in connection with
the
previously announced decision to reposition the Bank’s global structured
products businesses of $35 million; the impact of hedging relationships
accounting guideline (AcG-13) resulting in a gain of $10 million.
|
5.
|
Second
quarter 2006 - one-time adjustment for the impact of TD Ameritrade
earnings, due to the one month lag between fiscal quarter ends. The
results of the Bank include equity share in TD Ameritrade from January
25,
2006 to March 31, 2006. As a result of the one month lag, the impact
on
earnings per share was approximately 2 cents per share. Second quarter
2005 - adjusting for the impact of TD Banknorth earnings, due to
the one
month lag between fiscal quarter ends. Only one month of TD Banknorth
earnings were included in the second quarter while two months of
funding
costs and share issuance affected the quarter.
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
7
|
For
the three months ended
|
For
the six months ended
|
|||||||||||||||
April
30
|
January
31
|
April
30
|
April
30
|
April
30
|
||||||||||||
(millions
of Canadian dollars)
|
2006
|
2006
|
2005
|
2006
|
2005
|
|||||||||||
TD
Canada Trust
|
$
|
60
|
$
|
64
|
$
|
80
|
$
|
124
|
$
|
162
|
||||||
TD
Banknorth Reported
amortization of intangibles
|
17
|
14
|
5
|
31
|
5
|
|||||||||||
Less:
non-controlling interest
|
3
|
1
|
-
|
4
|
-
|
|||||||||||
Net amortization of intangibles
|
14
|
13
|
5
|
27
|
5
|
|||||||||||
TD
Ameritrade (included in equity in net income of associated
company)
|
7
|
-
|
-
|
7
|
-
|
|||||||||||
Other
|
5
|
5
|
5
|
10
|
10
|
|||||||||||
Amortization
of intangibles, net of income taxes1
|
$
|
86
|
$
|
82
|
$
|
90
|
$
|
168
|
$
|
177
|
1
|
Amortization
of intangibles is included in the Corporate segment.
|
For
the three months ended
|
For
the six months ended
|
|||||||||||||||
April
30
|
January
31
|
April
30
|
April
30
|
April
30
|
||||||||||||
(millions
of Canadian dollars)
|
2006
|
2006
|
2005
|
2006
|
2005
|
|||||||||||
Average
common equity
|
$
|
18,183
|
$
|
16,476
|
$
|
14,298
|
$
|
17,227
|
$
|
13,625
|
||||||
Average
cumulative goodwill/intangible assets amortized, net of income
taxes
|
3,511
|
3,432
|
3,166
|
3,471
|
3,123
|
|||||||||||
Average
invested capital
|
$
|
21,694
|
$
|
19,908
|
$
|
17,464
|
$
|
20,698
|
$
|
16,748
|
||||||
Rate
charged for invested capital
|
9.5
|
%
|
9.5
|
%
|
10.1
|
%
|
9.5
|
%
|
10.1
|
%
|
||||||
Charge
for invested capital
|
$
|
(503
|
)
|
$
|
(477
|
)
|
$
|
(430
|
)
|
$
|
(975
|
)
|
$
|
(839
|
)
|
|
Net
income available to common shareholders - reported
|
732
|
2,302
|
599
|
3,034
|
1,229
|
|||||||||||
Items
of note impacting income, net of income taxes
|
42
|
(1,472
|
)
|
73
|
(1,430
|
)
|
128
|
|||||||||
Net
income available to common shareholders - adjusted
|
774
|
830
|
672
|
1,604
|
1,357
|
|||||||||||
Economic
profit
|
$
|
271
|
$
|
353
|
$
|
242
|
$
|
629
|
$
|
518
|
||||||
Return
on invested capital
|
14.6
|
%
|
16.5
|
%
|
15.8
|
%
|
15.6
|
%
|
16.3
|
%
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
8
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
9
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
10
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
11
|
For
the three months ended
|
For
the six months ended
|
|||||||||||||||
April
30
|
January
31
|
April
30
|
April
30
|
April
30
|
||||||||||||
(millions
of Canadian dollars)
|
2006
|
2006
|
2005
|
2006
|
2005
|
|||||||||||
Net
new specifics (net of reversals)
|
$
|
106
|
$
|
151
|
$
|
79
|
$
|
257
|
$
|
178
|
||||||
Recoveries
|
(32
|
)
|
(31
|
)
|
(55
|
)
|
(63
|
)
|
(109
|
)
|
||||||
Provision
for credit losses - specifics
|
74
|
120
|
24
|
194
|
69
|
|||||||||||
Change
in general allowance
|
||||||||||||||||
TD
Bank
|
(60
|
)
|
-
|
-
|
(60
|
)
|
(35
|
)
|
||||||||
TD
Banknorth
|
2
|
(6
|
)
|
(4
|
)
|
(4
|
)
|
(4
|
)
|
|||||||
Total
|
$
|
16
|
$
|
114
|
$
|
20
|
$
|
130
|
$
|
30
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
12
|
For
the three months ended
|
For
the six months ended
|
||||||||||||||||||||||||||||||
April
30
|
January
31
|
April
30
|
April
30
|
April
30
|
|||||||||||||||||||||||||||
(millions
of Canadian dollars)
|
2006
|
2006
|
2005
|
2006
|
2005
|
||||||||||||||||||||||||||
Income
taxes at Canadian statutory income tax rate
|
$
|
347
|
34.9
|
%
|
$
|
897
|
35.0
|
%
|
$
|
291
|
35.0
|
%
|
$
|
1,244
|
35.0
|
%
|
$
|
590
|
35.0
|
%
|
|||||||||||
Increase
(decrease) resulting from:
|
|||||||||||||||||||||||||||||||
Dividends
received
|
(53
|
)
|
(5.3
|
)
|
(62
|
)
|
(2.4
|
)
|
(68
|
)
|
(8.2
|
)
|
(115
|
)
|
(3.2
|
)
|
(116
|
)
|
(6.9
|
)
|
|||||||||||
Rate
differentials on international operations
|
(45
|
)
|
(4.5
|
)
|
(53
|
)
|
(2.1
|
)
|
(61
|
)
|
(7.3
|
)
|
(98
|
)
|
(2.8
|
)
|
(98
|
)
|
(5.8
|
)
|
|||||||||||
Federal
large corporations tax
|
2
|
.2
|
2
|
.1
|
4
|
.5
|
4
|
.1
|
4
|
.3
|
|||||||||||||||||||||
Items
related to dilution gains and losses
|
2
|
.2
|
(584
|
)
|
(22.8
|
)
|
25
|
3.0
|
(582
|
)
|
(16.4
|
)
|
25
|
1.5
|
|||||||||||||||||
Other
-
net
|
(9
|
)
|
(1.0
|
)
|
20
|
.8
|
22
|
2.6
|
11
|
.3
|
29
|
1.7
|
|||||||||||||||||||
Provision
for income taxes and effective income tax rate - reported
|
$
|
244
|
24.5
|
%
|
$
|
220
|
8.6
|
%
|
$
|
213
|
25.6
|
%
|
$
|
464
|
13.0
|
%
|
$
|
434
|
25.8
|
%
|
For
the three months ended
|
For
the six months ended
|
|||||||||||||||
April
30
|
January
31
|
April
30
|
April
30
|
April
30
|
||||||||||||
(millions
of Canadian dollars)
|
2006
|
2006
|
2005
|
2006
|
2005
|
|||||||||||
Provision
for income taxes - reported
|
$
|
244
|
$
|
220
|
$
|
213
|
$
|
464
|
$
|
434
|
||||||
Increase
(decrease) resulting from items of note:
|
||||||||||||||||
Amortization
of
intangibles
|
43
|
46
|
44
|
89
|
91
|
|||||||||||
Dilution
gain
on Ameritrade, net of costs
|
-
|
34
|
-
|
34
|
-
|
|||||||||||
Balance
sheet restructuring charge in TD Banknorth
|
-
|
18
|
-
|
18
|
-
|
|||||||||||
Wholesale
Banking restructuring charge
|
-
|
15
|
7
|
15
|
7
|
|||||||||||
Hedging
impact due to AcG-13
|
(6
|
)
|
(5
|
)
|
(18
|
)
|
(11
|
)
|
(13
|
)
|
||||||
Other
tax items
|
-
|
-
|
(25
|
)
|
-
|
(25
|
)
|
|||||||||
Non-core
loan
loss recoveries (sectoral related)
|
-
|
-
|
(19
|
)
|
-
|
(34
|
)
|
|||||||||
General
allowance release
|
(21
|
)
|
-
|
-
|
(21
|
)
|
(12
|
)
|
||||||||
Tax
effect - items of note
|
16
|
108
|
(11
|
)
|
124
|
14
|
||||||||||
Provision
for income taxes - adjusted
|
$
|
260
|
$
|
328
|
$
|
202
|
$
|
588
|
$
|
448
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
13
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
14
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
15
|
For
the three months ended
|
For
the six months ended
|
|||||||||||||||
April
30
|
January
31
|
April
30
|
April
30
|
April
30
|
||||||||||||
(millions
of Canadian dollars)
|
2006
|
2006
|
2005
|
2006
|
2005
|
|||||||||||
Canadian
Wealth
|
$
|
113
|
$
|
105
|
$
|
88
|
$
|
218
|
$
|
166
|
||||||
TD
Ameritrade / TD Waterhouse U.S.A.
|
39
|
33
|
11
|
72
|
31
|
|||||||||||
Net
income
|
$
|
152
|
$
|
138
|
$
|
99
|
$
|
290
|
$
|
197
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
16
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
17
|
For
the three months ended
|
For
the six months ended
|
|||||||||||||||
April
30
|
January
31
|
April
30
|
April
30
|
April
30
|
||||||||||||
(millions
of Canadian dollars)
|
2006
|
2006
|
2005
|
2006
|
2005
|
|||||||||||
Balance
at beginning of period
|
$
|
365
|
$
|
349
|
$
|
513
|
$
|
349
|
$
|
537
|
||||||
Additions
|
214
|
263
|
159
|
477
|
370
|
|||||||||||
Return
to performing status, repaid or sold
|
(97
|
)
|
(95
|
)
|
(164
|
)
|
(192
|
)
|
(293
|
)
|
||||||
Arising
on acquisition of TD Banknorth
|
-
|
-
|
86
|
-
|
86
|
|||||||||||
Write-offs
|
(130
|
)
|
(152
|
)
|
(113
|
)
|
(282
|
)
|
(224
|
)
|
||||||
Foreign
exchange and other adjustments
|
(3
|
)
|
-
|
1
|
(3
|
)
|
6
|
|||||||||
Balance
at end of period
|
$
|
349
|
$
|
365
|
$
|
482
|
$
|
349
|
$
|
482
|
As
at
|
||||||||||
April
30
|
January
31
|
April
30
|
||||||||
(millions
of Canadian dollars)
|
2006
|
2006
|
2005
|
|||||||
Specific
allowance
|
$
|
135
|
$
|
155
|
$
|
250
|
||||
General
allowance
|
1,156
|
1,203
|
1,160
|
|||||||
Total
allowance for credit losses
|
$
|
1,291
|
$
|
1,358
|
$
|
1,410
|
||||
Total
net impaired loans
|
$
|
(942
|
)
|
$
|
(993
|
)
|
$
|
(928
|
)
|
|
Net
impaired loans as a percentage of net loans
|
(.6
|
)%
|
(.6
|
)%
|
(.6
|
)%
|
||||
Provision
for credit losses as a percentage of net average loans
|
.04
|
.29
|
.06
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
18
|
As
at
|
||||||||||
April
30
|
Oct.
31
|
April
30
|
||||||||
(billions
of Canadian dollars)
|
2006
|
2005
|
2005
|
|||||||
Tier
1 capital
|
$
|
16.4
|
$
|
13.1
|
$
|
12.8
|
||||
Tier
1 capital ratio
|
12.1
|
%
|
10.1
|
%
|
10.0
|
%
|
||||
Total
capital
|
$
|
19.2
|
$
|
17.2
|
$
|
17.1
|
||||
Total
capital ratio
|
14.1
|
%
|
13.2
|
%
|
13.4
|
%
|
||||
Risk-weighted
assets
|
$
|
135.8
|
$
|
130.0
|
$
|
127.6
|
||||
Tangible
common equity
|
$
|
12.3
|
$
|
9.6
|
$
|
8.8
|
||||
Tangible
common equity as a percentage of risk-weighted assets
|
9.0
|
%
|
7.4
|
%
|
6.9
|
%
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
19
|
Value
at Risk Usage
|
||||||||||||||||
For
the three months ended
|
For
the six months ended
|
|||||||||||||||
April
30, 2006
|
April
30, 2006
|
April
30, 2005
|
April
30, 2006
|
April
30, 2005
|
||||||||||||
(millions
of Canadian dollars)
|
As
at
|
Average
|
Average
|
Average
|
Average
|
|||||||||||
Interest
rate risk
|
$
|
13.0
|
$
|
10.8
|
$
|
7.9
|
$
|
9.4
|
$
|
8.3
|
||||||
Equity
risk
|
6.1
|
5.4
|
6.1
|
5.1
|
5.9
|
|||||||||||
Foreign
exchange risk
|
1.2
|
1.9
|
2.6
|
2.1
|
2.7
|
|||||||||||
Commodity
risk
|
1.1
|
1.1
|
1.3
|
1.0
|
1.3
|
|||||||||||
Diversification
effect
|
(9.2
|
)
|
(8.1
|
)
|
(8.2
|
)
|
(7.1
|
)
|
(8.9
|
)
|
||||||
General
Market Value at Risk
|
$
|
12.2
|
$
|
11.1
|
$
|
9.7
|
$
|
10.5
|
$
|
9.3
|
Quarterly
Results
|
|||||||||||||||||||||||||
For
the three months ended
|
|||||||||||||||||||||||||
2006
|
2005
|
2004
|
|||||||||||||||||||||||
(millions
of Canadian dollars)
|
Apr.
30
|
Jan.
31
|
Oct.
31
|
July
31
|
Apr.
30
|
Jan.
31
|
Oct.
31
|
July
31
|
|||||||||||||||||
Net
interest income
|
$
|
1,427
|
$
|
1,607
|
$
|
1,641
|
$
|
1,563
|
$
|
1,393
|
$
|
1,411
|
$
|
1,435
|
$
|
1,452
|
|||||||||
Other
income
|
1,691
|
1,797
|
1,442
|
1,535
|
1,517
|
1,395
|
1,118
|
1,181
|
|||||||||||||||||
Total
revenues
|
3,118
|
3,404
|
3,083
|
3,098
|
2,910
|
2,806
|
2,553
|
2,633
|
|||||||||||||||||
Provision
for (reversal of) credit losses
|
16
|
114
|
(15
|
)
|
40
|
20
|
10
|
(73
|
)
|
(17
|
)
|
||||||||||||||
Dilution
gain, net
|
(5
|
)
|
1,564
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||
Non-interest
expenses
|
2,103
|
2,290
|
2,203
|
2,577
|
2,057
|
1,945
|
1,904
|
1,907
|
|||||||||||||||||
Provision
for income taxes
|
244
|
220
|
253
|
12
|
213
|
221
|
127
|
178
|
|||||||||||||||||
Non-controlling
interests
|
47
|
37
|
53
|
58
|
21
|
-
|
-
|
-
|
|||||||||||||||||
Equity
in net income of associated company, net of tax
|
35
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||||
Net
income - reported
|
738
|
2,307
|
589
|
411
|
599
|
630
|
595
|
565
|
|||||||||||||||||
Adjustments
for items of note, net of taxes
|
42
|
(1,472
|
)
|
176
|
328
|
73
|
55
|
2
|
36
|
||||||||||||||||
Net
income - adjusted
|
780
|
835
|
765
|
739
|
672
|
685
|
597
|
601
|
|||||||||||||||||
Preferred
dividends
|
6
|
5
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||||
Net
income available to common shareholders - adjusted
|
$
|
774
|
$
|
830
|
$
|
765
|
$
|
739
|
$
|
672
|
$
|
685
|
$
|
597
|
$
|
601
|
|||||||||
(Canadian
dollars)
|
|||||||||||||||||||||||||
Basic
earnings per share
|
|||||||||||||||||||||||||
-
reported
|
$
|
1.02
|
$
|
3.23
|
$
|
.83
|
$
|
.58
|
$
|
.87
|
$
|
.96
|
$
|
.91
|
$
|
.87
|
|||||||||
-
adjusted
|
1.10
|
1.16
|
1.08
|
1.04
|
1.00
|
1.04
|
.91
|
.92
|
|||||||||||||||||
Diluted
earnings per share
|
|||||||||||||||||||||||||
-
reported
|
1.01
|
3.20
|
.82
|
.58
|
.86
|
.95
|
.90
|
.86
|
|||||||||||||||||
-
adjusted
|
1.09
|
1.15
|
1.06
|
1.04
|
1.00
|
1.04
|
.91
|
.91
|
|||||||||||||||||
Return
on common shareholders’ equity
|
16.5
|
%
|
55.4
|
%
|
14.8
|
%
|
10.4
|
%
|
17.2
|
%
|
19.5
|
%
|
19.1
|
%
|
18.4
|
%
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
20
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
21
|
INTERIM
CONSOLIDATED BALANCE SHEET
(unaudited)
|
|||||||
As
at
|
|||||||
Apr.
30
|
Oct.
31
|
||||||
(millions
of Canadian dollars)
|
2006
|
2005
|
|||||
ASSETS
|
|||||||
Cash
and due from banks
|
$
|
2,046
|
$
|
1,673
|
|||
Interest-bearing
deposits with banks
|
10,295
|
11,745
|
|||||
12,341
|
13,418
|
||||||
Securities
|
|||||||
Investment
|
42,847
|
42,321
|
|||||
Trading
|
69,809
|
65,775
|
|||||
112,656
|
108,096
|
||||||
Securities
purchased under reverse repurchase agreements
|
32,344
|
26,375
|
|||||
Loans
|
|||||||
Residential
mortgages
|
50,868
|
52,740
|
|||||
Consumer
instalment and other personal
|
63,308
|
62,754
|
|||||
Credit
card
|
3,764
|
2,998
|
|||||
Business
and government
|
39,923
|
35,044
|
|||||
157,863
|
153,536
|
||||||
Allowance
for credit losses (Note
3)
|
(1,291
|
)
|
(1,293
|
)
|
|||
Loans
(net of allowance for credit losses)
|
156,572
|
152,243
|
|||||
Other
|
|||||||
Customers’
liability under acceptances
|
7,035
|
5,989
|
|||||
Investment
in TD Ameritrade
(Note 13(c))
|
3,783
|
-
|
|||||
Trading
derivatives’ market revaluation
|
35,430
|
33,651
|
|||||
Goodwill
|
7,652
|
6,518
|
|||||
Other
intangibles
|
2,185
|
2,124
|
|||||
Land,
buildings and equipment
|
1,857
|
1,801
|
|||||
Other
assets
|
16,741
|
14,995
|
|||||
74,683
|
65,078
|
||||||
Total
assets
|
$
|
388,596
|
$
|
365,210
|
|||
LIABILITIES
|
|||||||
Deposits
|
|||||||
Personal
|
$
|
138,826
|
$
|
131,783
|
|||
Banks
|
13,597
|
11,505
|
|||||
Business
and government
|
100,568
|
103,693
|
|||||
252,991
|
246,981
|
||||||
Other
|
|||||||
Acceptances
|
7,035
|
5,989
|
|||||
Obligations
related to securities sold short
|
27,037
|
24,406
|
|||||
Obligations
related to securities sold under repurchase agreements
|
16,983
|
11,284
|
|||||
Trading
derivatives’ market revaluation
|
36,295
|
33,498
|
|||||
Other
liabilities
|
16,908
|
18,545
|
|||||
104,258
|
93,722
|
||||||
Subordinated
notes and debentures (Note 6)
|
7,748
|
5,138
|
|||||
Liabilities
for preferred shares and capital trust securities (Note
7)
|
1,786
|
1,795
|
|||||
Non-controlling
interests in subsidiaries
|
2,530
|
1,708
|
|||||
SHAREHOLDERS’
EQUITY
|
|||||||
Common
shares (millions of shares issued and outstanding: 718.8 and 711.8)
(Note
8)
|
6,245
|
5,872
|
|||||
Preferred
shares (millions of shares issued and outstanding: 17.0 and nil)
(Note
8)
|
425
|
-
|
|||||
Contributed
surplus
|
51
|
40
|
|||||
Foreign
currency translation adjustments
|
(507
|
)
|
(696
|
)
|
|||
Retained
earnings
|
13,069
|
10,650
|
|||||
19,283
|
15,866
|
||||||
Total
liabilities and shareholders’ equity
|
$
|
388,596
|
$
|
365,210
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
22
|
INTERIM
CONSOLIDATED STATEMENT OF INCOME
(unaudited)
|
|||||||||||||
For
the three months ended
|
For
the six months ended
|
||||||||||||
April
30
|
April
30
|
April
30
|
April
30
|
||||||||||
(millions
of Canadian dollars)
|
2006
|
2005
|
2006
|
2005
|
|||||||||
Interest
income
|
|||||||||||||
Loans
|
$
|
2,514
|
$
|
1,893
|
$
|
4,966
|
$
|
3,725
|
|||||
Securities
|
|||||||||||||
Dividends
|
190
|
268
|
412
|
497
|
|||||||||
Interest
|
776
|
747
|
1,813
|
1,603
|
|||||||||
Deposits
with banks
|
78
|
105
|
158
|
200
|
|||||||||
3,558
|
3,013
|
7,349
|
6,025
|
||||||||||
Interest
expense
|
|||||||||||||
Deposits
|
1,754
|
1,223
|
3,288
|
2,331
|
|||||||||
Subordinated
notes and debentures
|
99
|
83
|
185
|
162
|
|||||||||
Preferred
shares and capital trust securities
|
28
|
34
|
67
|
63
|
|||||||||
Other
liabilities
|
250
|
280
|
775
|
665
|
|||||||||
2,131
|
1,620
|
4,315
|
3,221
|
||||||||||
Net
interest income
|
1,427
|
1,393
|
3,034
|
2,804
|
|||||||||
Other
income
|
|||||||||||||
Investment
and securities services
|
532
|
607
|
1,174
|
1,207
|
|||||||||
Trading
income
|
247
|
79
|
539
|
155
|
|||||||||
Insurance,
net of claims
|
228
|
215
|
452
|
399
|
|||||||||
Service
charges
|
220
|
171
|
441
|
341
|
|||||||||
Loan
securitizations (Note
4)
|
72
|
100
|
164
|
193
|
|||||||||
Credit
fees
|
82
|
85
|
168
|
183
|
|||||||||
Card
services
|
86
|
61
|
167
|
113
|
|||||||||
Trust
fees
|
37
|
28
|
66
|
45
|
|||||||||
Net
investment securities gains
|
82
|
47
|
105
|
99
|
|||||||||
Other
|
105
|
124
|
212
|
177
|
|||||||||
1,691
|
1,517
|
3,488
|
2,912
|
||||||||||
Total
revenues
|
3,118
|
2,910
|
6,522
|
5,716
|
|||||||||
Provision
for credit losses (Note 3)
|
16
|
20
|
130
|
30
|
|||||||||
Dilution
gain (loss), net (Note 13 (c))
|
(5
|
)
|
-
|
1,559
|
-
|
||||||||
Non-interest
expenses
|
|||||||||||||
Salaries
and employee benefits
|
1,093
|
1,029
|
2,267
|
2,010
|
|||||||||
Occupancy,
including depreciation
|
172
|
164
|
338
|
312
|
|||||||||
Equipment,
including depreciation
|
138
|
147
|
285
|
279
|
|||||||||
Amortization
of other intangibles
|
125
|
134
|
253
|
268
|
|||||||||
Restructuring
costs
|
-
|
22
|
50
|
22
|
|||||||||
Marketing
and business development
|
96
|
126
|
229
|
230
|
|||||||||
Brokerage
related fees
|
39
|
57
|
92
|
115
|
|||||||||
Professional
and advisory services
|
126
|
114
|
231
|
222
|
|||||||||
Communications
|
48
|
49
|
97
|
95
|
|||||||||
Other
|
266
|
215
|
551
|
449
|
|||||||||
2,103
|
2,057
|
4,393
|
4,002
|
||||||||||
Income
before provision for income taxes, non-controlling interests in
subsidiaries and equity in net income of associated
company
|
994
|
833
|
3,558
|
1,684
|
|||||||||
Provision
for income taxes
|
244
|
213
|
464
|
434
|
|||||||||
750
|
620
|
3,094
|
1,250
|
||||||||||
Non-controlling
interests in subsidiaries, net of tax
|
47
|
21
|
84
|
21
|
|||||||||
Equity
in net income of associated company, net of tax (Note
13(c))
|
35
|
-
|
35
|
-
|
|||||||||
Net
income
|
738
|
599
|
3,045
|
1,229
|
|||||||||
Preferred
dividends
|
6
|
-
|
11
|
-
|
|||||||||
Net
income available to common shareholders
|
$
|
732
|
$
|
599
|
$
|
3,034
|
$
|
1,229
|
|||||
Average
number of common shares outstanding
(millions)
|
|||||||||||||
Basic
|
715.7
|
690.8
|
714.1
|
673.4
|
|||||||||
Diluted
|
722.5
|
696.1
|
720.7
|
678.7
|
|||||||||
Earnings
per share
(in dollars)
|
|||||||||||||
Basic
|
$
|
1.02
|
$
|
.87
|
$
|
4.25
|
$
|
1.83
|
|||||
Diluted
|
1.01
|
.86
|
4.21
|
1.81
|
|||||||||
Dividends
per share
(in dollars)
|
.44
|
.40
|
.86
|
.76
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
23
|
INTERIM
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’
EQUITY
(unaudited)
|
|||||||
For
the six months ended
|
|||||||
April
30
|
April
30
|
||||||
(millions
of Canadian dollars)
|
2006
|
2005
|
|||||
Common
shares
|
|||||||
Balance
at beginning of period
|
$
|
5,872
|
$
|
3,373
|
|||
Proceeds
from shares issued on exercise of options
|
80
|
72
|
|||||
Proceeds
from shares issued as a result of dividend reinvestment
plan
|
207
|
174
|
|||||
Impact
of shares sold in Wholesale Banking
|
16
|
25
|
|||||
Issued
on acquisition of TD Banknorth
|
-
|
1,988
|
|||||
Issued
on acquisition of VFC (Note
13 (a))
|
70
|
-
|
|||||
Balance
at end of period
|
6,245
|
5,632
|
|||||
Preferred
Shares
|
|||||||
Proceeds
from share issues
(Note 8)
|
425
|
-
|
|||||
Balance
at end of period
|
425
|
-
|
|||||
Contributed
surplus
|
|||||||
Balance
at beginning of period
|
40
|
20
|
|||||
Stock
options (Note
9)
|
11
|
8
|
|||||
Balance
at end of period
|
51
|
28
|
|||||
Foreign
currency translation adjustments
|
|||||||
Balance
at beginning of period
|
(696
|
)
|
(265
|
)
|
|||
Foreign
exchange (losses) gains from investments in subsidiaries and other
items
|
(399
|
)
|
279
|
||||
Impact
of reduction in investment in TD Waterhouse U.S.A.
(Note 13 (c))
|
66
|
-
|
|||||
Foreign
exchange gains (losses) from hedging activities
|
774
|
(477
|
)
|
||||
(Provision
for) benefit of income taxes
|
(252
|
)
|
165
|
||||
Balance
at end of period
|
(507
|
)
|
(298
|
)
|
|||
Retained
earnings
|
|||||||
Balance
at beginning of period
|
10,650
|
9,540
|
|||||
Net
income
|
3,045
|
1,229
|
|||||
Common
dividends
|
(615
|
)
|
(517
|
)
|
|||
Preferred
dividends
|
(11
|
)
|
-
|
||||
Other
|
-
|
(22
|
)
|
||||
Balance
at end of period
|
13,069
|
10,230
|
|||||
Total
shareholders’ equity at end of period
|
$
|
19,283
|
$
|
15,592
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
24
|
For
the three months ended
|
For
the six months ended
|
||||||||||||
April
30
|
April
30
|
April
30
|
April
30
|
||||||||||
(millions
of Canadian dollars)
|
2006
|
2005
|
2006
|
2005
|
|||||||||
Cash
flows from (used in) operating activities
|
|||||||||||||
Net
income
|
$
|
738
|
$
|
599
|
$
|
3,045
|
$
|
1,229
|
|||||
Adjustments
to determine net cash flows from (used in) operating
activities
|
|||||||||||||
Provision
for
credit losses
|
16
|
20
|
130
|
30
|
|||||||||
Restructuring
costs
|
-
|
22
|
50
|
22
|
|||||||||
Depreciation
|
77
|
73
|
162
|
135
|
|||||||||
Amortization
of
other intangibles
|
125
|
134
|
253
|
268
|
|||||||||
Stock
option expense
|
4
|
4
|
11
|
8
|
|||||||||
Dilution
loss
(gain), net
|
5
|
-
|
(1,559
|
)
|
-
|
||||||||
Net
investment securities gains
|
(82
|
)
|
(47
|
)
|
(105
|
)
|
(99
|
)
|
|||||
Gain
on
securitizations
|
(20
|
)
|
(49
|
)
|
(53
|
)
|
(88
|
)
|
|||||
Equity
in net income of associated company
|
(35
|
)
|
-
|
(35
|
)
|
-
|
|||||||
Non-controlling
interests
|
47
|
21
|
84
|
21
|
|||||||||
Changes
in operating assets and liabilities
|
|||||||||||||
Future
income taxes
|
(64
|
)
|
206
|
105
|
158
|
||||||||
Current
income taxes payable
|
39
|
(109
|
)
|
(8
|
)
|
(268
|
)
|
||||||
Interest
receivable and payable
|
9
|
(100
|
)
|
(35
|
)
|
265
|
|||||||
Trading
securities
|
5,191
|
4,229
|
(4,034
|
)
|
(4,855
|
)
|
|||||||
Unrealized
gains and amounts receivable on derivatives contracts
|
(1,649
|
)
|
973
|
(1,779
|
)
|
(1,252
|
)
|
||||||
Unrealized
losses and amounts payable on derivatives contracts
|
1,361
|
(417
|
)
|
2,797
|
476
|
||||||||
Other
|
(2,500
|
)
|
(1,353
|
)
|
(3,535
|
)
|
175
|
||||||
Net
cash from (used in) operating activities
|
3,262
|
4,206
|
(4,506
|
)
|
(3,775
|
)
|
|||||||
Cash
flows from (used in) financing activities
|
|||||||||||||
Change
in deposits
|
(3,670
|
)
|
(2,367
|
)
|
1,330
|
12,702
|
|||||||
Securities
sold under repurchase agreements
|
4,463
|
(439
|
)
|
4,993
|
403
|
||||||||
Securities
sold short
|
680
|
(2,368
|
)
|
2,631
|
1,352
|
||||||||
Issue
of subordinated notes and debentures
|
541
|
-
|
2,341
|
-
|
|||||||||
Repayment
of subordinated notes and debentures
|
-
|
(750
|
)
|
(150
|
)
|
(752
|
)
|
||||||
Subordinated
notes and debentures (acquired) sold in Wholesale Banking
|
(21
|
)
|
(1
|
)
|
(20
|
)
|
4
|
||||||
Liability
for preferred shares and capital trust securities
|
(7
|
)
|
-
|
(9
|
)
|
(350
|
)
|
||||||
Translation
adjustment on subordinated notes and debentures issued in a foreign
currency
|
3
|
(10
|
)
|
3
|
3
|
||||||||
Common
shares issued on exercise of options
|
35
|
45
|
80
|
72
|
|||||||||
Common
shares issued as a result of dividend reinvestment plan
|
107
|
101
|
207
|
174
|
|||||||||
Common
shares (acquired) sold in Wholesale Banking
|
18
|
23
|
16
|
25
|
|||||||||
Dividends
paid on common shares
|
(315
|
)
|
(281
|
)
|
(615
|
)
|
(517
|
)
|
|||||
Issuance
of preferred shares
|
-
|
-
|
425
|
-
|
|||||||||
Dividends
paid on preferred shares
|
(6
|
)
|
-
|
(11
|
)
|
-
|
|||||||
Net
cash from (used in) financing activities
|
1,828
|
(6,047
|
)
|
11,221
|
13,116
|
||||||||
Cash
flows from (used in) investing activities
|
|||||||||||||
Interest-bearing
deposits with banks
|
931
|
(198
|
)
|
1,450
|
(1,423
|
)
|
|||||||
Activity
in investment securities
|
|||||||||||||
Purchases
|
(65,983
|
)
|
(4,656
|
)
|
(77,071
|
)
|
(14,786
|
)
|
|||||
Proceeds
from
maturities
|
62,098
|
985
|
67,443
|
3,901
|
|||||||||
Proceeds
from
sales
|
7,496
|
5,031
|
12,215
|
8,822
|
|||||||||
Activity
from lending activities
|
|||||||||||||
Origination
and
acquisitions
|
(55,040
|
)
|
(16,111
|
)
|
(104,188
|
)
|
(34,271
|
)
|
|||||
Proceeds
from
maturities
|
51,246
|
14,752
|
97,756
|
28,292
|
|||||||||
Proceeds
from
sales
|
265
|
426
|
598
|
1,487
|
|||||||||
Proceeds
from
loan securitizations
|
2,335
|
2,525
|
3,392
|
4,165
|
|||||||||
Land,
buildings and equipment
|
(233
|
)
|
(566
|
)
|
(308
|
)
|
(539
|
)
|
|||||
Securities
purchased under reverse repurchase agreements
|
(7,497
|
)
|
2,493
|
(5,961
|
)
|
(1,839
|
)
|
||||||
TD
Banknorth share repurchase program
|
(290
|
)
|
(603
|
)
|
(290
|
)
|
(603
|
)
|
|||||
Acquisition
and disposition less cash and cash equivalents acquired
|
(516
|
)
|
(2,184
|
)
|
(1,335
|
)
|
(2,184
|
)
|
|||||
Net
cash from (used in) investing activities
|
(5,188
|
)
|
1,894
|
(6,299
|
)
|
(8,978
|
)
|
||||||
Effect
of exchange rate changes on cash and cash equivalents
|
(14
|
)
|
15
|
(43
|
)
|
30
|
|||||||
Net
increase (decrease) in cash and cash equivalents
|
(112
|
)
|
68
|
373
|
393
|
||||||||
Cash
and cash equivalents at beginning of period
|
2,158
|
1,729
|
1,673
|
1,404
|
|||||||||
Cash
and cash equivalents at end of period, represented by cash and due
from
banks
|
$
|
2,046
|
$
|
1,797
|
$
|
2,046
|
$
|
1,797
|
|||||
Supplementary
disclosure of cash flow information
|
|||||||||||||
Amount
of interest paid during the period
|
$
|
2,020
|
$
|
1,587
|
$
|
4,301
|
$
|
3,101
|
|||||
Amount
of income taxes paid during the period
|
260
|
214
|
603
|
545
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
25
|
Allowance
for Credit Losses
|
|||||||||||||||||||
For
the six months ended
|
For
the six months ended
|
||||||||||||||||||
April
30, 2006
|
April
30, 2005
|
||||||||||||||||||
Specific
|
General
|
Specific
|
General
|
||||||||||||||||
(millions
of Canadian dollars)
|
Allowance
|
allowance
|
Total
|
allowance
|
allowance
|
Total
|
|||||||||||||
Balance
at beginning of year
|
$
|
153
|
$
|
1,140
|
$
|
1,293
|
$
|
266
|
$
|
917
|
$
|
1,183
|
|||||||
Acquisitions
of TD Banknorth (includes Hudson) and VFC
|
-
|
87
|
87
|
27
|
289
|
316
|
|||||||||||||
Provision
for (reversal of) credit losses
|
194
|
(64
|
)
|
130
|
69
|
(39
|
)
|
30
|
|||||||||||
Write-offs
|
(282
|
)
|
-
|
(282
|
)
|
(224
|
)
|
-
|
(224
|
)
|
|||||||||
Recoveries
|
63
|
-
|
63
|
109
|
-
|
109
|
|||||||||||||
Other1
|
7
|
(7
|
)
|
-
|
3
|
(7
|
)
|
(4
|
)
|
||||||||||
Allowance
for credit losses at end of period
|
$
|
135
|
$
|
1,156
|
$
|
1,291
|
$
|
250
|
$
|
1,160
|
$
|
1,410
|
1
|
Includes
foreign exchange rate changes and losses on loan sales booked to
sectoral
allowance.
|
New
Securitization Activity
|
|||||||||||||||||||||||||||||||
For
the three months ended
|
For
the three months ended
|
||||||||||||||||||||||||||||||
April
30, 2006
|
April
30, 2005
|
||||||||||||||||||||||||||||||
Residential
|
Credit
|
Commercial
|
Residential
|
Credit
|
Commercial
|
||||||||||||||||||||||||||
mortgage
|
Personal
|
card
|
mortgage
|
mortgage
|
Personal
|
card
|
mortgage
|
||||||||||||||||||||||||
(millions
of Canadian dollars)
|
loans
|
loans
|
loans
|
loans
|
Total
|
loans
|
loans
|
loans
|
loans
|
Total
|
|||||||||||||||||||||
Gross
proceeds
|
$
|
1,748
|
$
|
721
|
$
|
1,300
|
$
|
292
|
$
|
4,061
|
$
|
1,441
|
$
|
2,100
|
$
|
1,300
|
$
|
299
|
$
|
5,140
|
|||||||||||
Retained
interest
|
22
|
5
|
19
|
-
|
46
|
32
|
16
|
24
|
-
|
72
|
|||||||||||||||||||||
Cash
flows received on retained interests
|
49
|
6
|
44
|
1
|
100
|
44
|
9
|
41
|
1
|
95
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
26
|
New
Securitization Activity
|
|||||||||||||||||||||||||||||||
For
the six months ended
|
For
the six months ended
|
||||||||||||||||||||||||||||||
April
30, 2006
|
April
30, 2005
|
||||||||||||||||||||||||||||||
Residential
|
Credit
|
Commercial
|
Residential
|
Credit
|
Commercial
|
||||||||||||||||||||||||||
mortgage
|
Personal
|
card
|
mortgage
|
mortgage
|
Personal
|
card
|
mortgage
|
||||||||||||||||||||||||
(millions
of Canadian dollars)
|
loans
|
loans
|
loans
|
loans
|
Total
|
loans
|
loans
|
loans
|
loans
|
Total
|
|||||||||||||||||||||
Gross
proceeds
|
$
|
3,081
|
$
|
1,448
|
$
|
2,600
|
$
|
292
|
$
|
7,421
|
$
|
3,090
|
$
|
2,571
|
$
|
2,600
|
$
|
299
|
$
|
8,560
|
|||||||||||
Retained
interest
|
42
|
10
|
45
|
-
|
97
|
67
|
19
|
48
|
-
|
134
|
|||||||||||||||||||||
Cash
flows received on retained interests
|
106
|
14
|
92
|
1
|
213
|
88
|
19
|
84
|
3
|
194
|
For
the three months ended
|
For
the three months ended
|
||||||||||||||||||||||||||||||
April
30, 2006
|
April
30, 2005
|
||||||||||||||||||||||||||||||
Residential
|
Credit
|
Commercial
|
Residential
|
Credit
|
Commercial
|
||||||||||||||||||||||||||
mortgage
|
Personal
|
card
|
mortgage
|
mortgage
|
Personal
|
card
|
mortgage
|
||||||||||||||||||||||||
(millions
of Canadian dollars)
|
loans
|
loans
|
loans
|
loans
|
Total
|
loans
|
loans
|
loans
|
loans
|
Total
|
|||||||||||||||||||||
Gain
on sale (loss)1
|
$
|
(1
|
)
|
$
|
5
|
$
|
14
|
$
|
2
|
$
|
20
|
$
|
12
|
$
|
8
|
$
|
22
|
$
|
7
|
$
|
49
|
||||||||||
Servicing
income
|
17
|
5
|
30
|
-
|
52
|
22
|
10
|
19
|
-
|
51
|
|||||||||||||||||||||
Total
|
$
|
16
|
$
|
10
|
$
|
44
|
$
|
2
|
$
|
72
|
$
|
34
|
$
|
18
|
$
|
41
|
$
|
7
|
$
|
100
|
For
the six months ended
|
For
the six months ended
|
||||||||||||||||||||||||||||||
April
30, 2006
|
April
30, 2005
|
||||||||||||||||||||||||||||||
Residential
|
Credit
|
Commercial
|
Residential
|
Credit
|
Commercial
|
||||||||||||||||||||||||||
mortgage
|
Personal
|
card
|
mortgage
|
mortgage
|
Personal
|
card
|
mortgage
|
||||||||||||||||||||||||
(millions
of Canadian dollars)
|
loans
|
loans
|
loans
|
loans
|
Total
|
loans
|
loans
|
loans
|
loans
|
Total
|
|||||||||||||||||||||
Gain
on sale (loss)1
|
$
|
(2
|
)
|
$
|
10
|
$
|
43
|
$
|
2
|
$
|
53
|
$
|
26
|
$
|
11
|
$
|
44
|
$
|
7
|
$
|
88
|
||||||||||
Servicing
income
|
55
|
12
|
44
|
-
|
111
|
45
|
20
|
40
|
-
|
105
|
|||||||||||||||||||||
Total
|
$
|
53
|
$
|
22
|
$
|
87
|
$
|
2
|
$
|
164
|
$
|
71
|
$
|
31
|
$
|
84
|
$
|
7
|
$
|
193
|
1
|
For
term loans, the gain on sale is after the impact of hedges on assets
sold.
|
Key
Assumptions
|
|||||||||||||||||||||||||
2006
|
2005
|
||||||||||||||||||||||||
Residential
|
Credit
|
Commercial
|
Residential
|
Credit
|
Commercial
|
||||||||||||||||||||
mortgage
|
Personal
|
card
|
mortgage
|
mortgage
|
Personal
|
card
|
mortgage
|
||||||||||||||||||
loans
|
loans
|
loans
|
loans
|
loans
|
loans
|
loans
|
loans
|
||||||||||||||||||
Prepayment
rate1
|
20.0
|
%
|
5.9
|
%
|
44.4
|
%
|
2.2
|
%
|
20.0
|
%
|
6.1
|
%
|
41.3
|
%
|
2.7
|
%
|
|||||||||
Excess
spread2
|
.6
|
1.0
|
12.8
|
-
|
.7
|
1.1
|
13.1
|
-
|
|||||||||||||||||
Discount
rate
|
5.4
|
3.8
|
5.2
|
9.8
|
5.1
|
3.3
|
4.1
|
9.8
|
|||||||||||||||||
Expected
credit losses3
|
-
|
-
|
2.5
|
.1
|
-
|
-
|
2.6
|
.1
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
27
|
Liabilities
|
|||||||
(millions
of Canadian dollars)
|
April
30, 2006
|
Oct.
31, 2005
|
|||||
Preferred
Shares
|
|||||||
Preferred
shares issued by the Bank (thousands of shares):
|
|||||||
Class
A - 16 Series I
|
$
|
-
|
$
|
-
|
|||
Class
A - 14,000 Series M
|
350
|
350
|
|||||
Class
A - 8,000 Series N
|
200
|
200
|
|||||
550
|
550
|
||||||
Preferred
shares issued by TD Mortgage
|
|||||||
Investment
Corporation (thousands of shares):
|
|||||||
350
non-cumulative preferred shares, Series A
|
339
|
345
|
|||||
Total
Preferred shares
|
889
|
895
|
|||||
Capital
Trust Securities (thousands of units)1
|
|||||||
Trust
units issued by TD Capital Trust (900)
|
897
|
900
|
|||||
Total
Preferred Shares and Capital Trust Securities
|
$
|
1,786
|
$
|
1,795
|
Shares
Issued and Outstanding
|
|||||||||||||
For
the six months ended
|
For
the six months ended
|
||||||||||||
April
30, 2006
|
April
30, 2005
|
||||||||||||
(millions
of shares and millions of Canadian dollars)
|
Number
of shares
|
Amount
|
Number
of shares
|
Amount
|
|||||||||
Common:
|
|||||||||||||
Balance
at beginning of period
|
711.8
|
$
|
5,872
|
655.9
|
3,373
|
||||||||
Issued
on exercise of options
|
2.3
|
80
|
2.5
|
72
|
|||||||||
Issued
as a result of dividend reinvestment plan
|
3.4
|
207
|
3.5
|
174
|
|||||||||
Impact
of shares sold in Wholesale Banking
|
.2
|
16
|
.5
|
25
|
|||||||||
Issued
on the acquisition of VFC
|
1.1
|
70
|
-
|
-
|
|||||||||
Issued
on the acquisition of TD Banknorth
|
-
|
-
|
44.3
|
1,988
|
|||||||||
Balance
at end of period - Common
|
718.8
|
$
|
6,245
|
706.7
|
5,632
|
||||||||
Balance
at October 31, 2005 - Common
|
711.8
|
$
|
5,872
|
||||||||||
Preferred
(Class A - Series O):
|
|||||||||||||
Balance
at end of period - Preferred
|
17.0
|
$
|
425
|
-
|
$
|
-
|
|||||||
Balance
at October 31, 2005 - Preferred
|
-
|
$
|
-
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
28
|
For
the three months ended
|
For
the six months ended
|
||||||||||||
April
30
|
April
30
|
April
30
|
April
30
|
||||||||||
(millions
of Canadian dollars)
|
2006
|
2005
|
2006
|
2005
|
|||||||||
TD
Bank
|
$
|
4
|
$
|
4
|
$
|
11
|
$
|
8
|
|||||
TD
Banknorth
|
2
|
1
|
4
|
1
|
|||||||||
Total
|
$
|
6
|
$
|
5
|
$
|
15
|
$
|
9
|
For
the six months ended
|
|||||||
April
30
|
April
30
|
||||||
2006
|
2005
|
||||||
Risk-free
interest rate
|
3.91
|
%
|
3.70
|
%
|
|||
Expected
option life
|
5.1
years
|
5.3
years
|
|||||
Expected
volatility
|
21.9
|
%
|
25.7
|
%
|
|||
Expected
dividend yield
|
2.88
|
%
|
2.84
|
%
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
29
|
Principal
Pension Plan Expense
|
|||||||||||||
For
the three months ended
|
For
the six months ended
|
||||||||||||
April
30
|
April
30
|
April
30
|
April
30
|
||||||||||
(millions
of Canadian dollars)
|
2006
|
2005
|
2006
|
2005
|
|||||||||
Elements
of pension plan expense before adjustments to recognize the long
term
nature of the cost:
|
|||||||||||||
Service
cost - benefits earned
|
$
|
18
|
$
|
11
|
$
|
36
|
$
|
23
|
|||||
Interest
cost
on projected benefit obligation
|
26
|
26
|
53
|
51
|
|||||||||
Actual
return on plan assets
|
(141
|
)
|
(88
|
)
|
(128
|
)
|
(119
|
)
|
|||||
Plan
amendments
|
7
|
4
|
7
|
57
|
|||||||||
Adjustments
to recognize the long term nature of plan cost
|
|||||||||||||
Difference
between costs arising in the period and costs recognized
|
|||||||||||||
In
the
period in respect of:
|
|||||||||||||
Return
on plan assets1
|
109
|
60
|
64
|
63
|
|||||||||
Actuarial
losses2
|
5
|
2
|
11
|
5
|
|||||||||
Plan
amendments3
|
(5
|
)
|
(2
|
)
|
(3
|
)
|
(54
|
)
|
|||||
Total
|
$
|
19
|
$
|
13
|
$
|
40
|
$
|
26
|
1
|
For
the three months ended April 30, 2006, includes expected return on
plan
assets of $32 million (Q2/05 - $28 million) less actual return on
plan
assets of $141 million (Q2/05 - $88 million). For the six months
ended
April 30, 2006, includes expected return on plan assets of $64 million
(six months ended April 30, 2005 - $56 million) less actual return
on plan
assets of $128 million (six months ended April 30, 2005 - $119 million).
|
2
|
For
the three months ended April 30, 2006, includes loss recognized of
$5
million (Q2/05 - $2 million) less actuarial losses on projected benefit
obligation of nil (Q2/05 - nil). For the six months ended April 30,
2006,
includes loss recognized of $11 million (six months ended April 30,
2005 -
$5 million) less actuarial losses on projected benefit obligation
of nil
(six months ended April 30, 2005 - nil).
|
3
|
For
the three months ended April 30, 2006, includes amortization of costs
for
plan amendments of $2 million (Q2/05 - $2 million) less actual cost
amendments of $7 million (Q2/05 - $4 million). For the six months
ended
April 30, 2006, includes amortization of costs for plan amendments
of $4
million (six months ended April 30, 2005 - $3 million) less actual
cost
amendments of $7 million (six months ended April 30, 2005 - $57 million).
|
Other
Pension Plans’ Expense
|
|||||||||||||
For
the three months ended
|
For
the six months ended
|
||||||||||||
April
30
|
April
30
|
April
30
|
April
|
||||||||||
(millions
of Canadian dollars)
|
2006
|
2005
|
2006
|
2005
|
|||||||||
CT
defined benefit pension plan
|
$
|
1
|
$
|
1
|
$
|
3
|
$
|
2
|
|||||
TD
Banknorth defined benefit pension plans
|
2
|
1
|
4
|
1
|
|||||||||
Supplemental
employee retirement plans
|
8
|
6
|
17
|
12
|
|||||||||
Total
|
$
|
11
|
$
|
8
|
$
|
24
|
$
|
15
|
Principal
Non-Pension Post-Retirement Benefit Plans Expense
|
|||||||||||||
For
the three months ended
|
For
the six months ended
|
||||||||||||
April
30
|
April
30
|
April
30
|
April
30
|
||||||||||
(millions
of Canadian dollars)
|
2006
|
2005
|
2006
|
2005
|
|||||||||
Service
cost - benefits earned
|
$
|
3
|
$
|
3
|
$
|
6
|
$
|
6
|
|||||
Interest
cost on projected benefit obligation
|
5
|
5
|
10
|
10
|
|||||||||
Plan
amendments
|
-
|
(65
|
)
|
-
|
|||||||||
Difference
between costs arising in the period and costs recognized in the period
in
respect of:
|
|||||||||||||
Actuarial
losses
|
2
|
-
|
4
|
-
|
|||||||||
Plan
amendments
|
(2
|
)
|
-
|
62
|
-
|
||||||||
Total
|
$
|
8
|
$
|
8
|
$
|
17
|
$
|
16
|
Pension
Plan Contributions
|
|||||||||||||
For
the three months ended
|
For
the six months ended
|
||||||||||||
April
30
|
April
30
|
April
30
|
April
30
|
||||||||||
(millions
of Canadian dollars)
|
2006
|
2005
|
2006
|
2005
|
|||||||||
Principal
pension plan
|
$
|
15
|
$
|
13
|
$
|
30
|
$
|
27
|
|||||
CT
defined benefit pension plan
|
-
|
-
|
1
|
1
|
|||||||||
TD
Banknorth defined benefit pension plans
|
1
|
-
|
33
|
-
|
|||||||||
Supplemental
employee retirement plans
|
2
|
3
|
4
|
5
|
|||||||||
Non-pension
post-retirement benefit plans
|
2
|
2
|
4
|
4
|
|||||||||
Total
|
$
|
20
|
$
|
18
|
$
|
72
|
$
|
37
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
30
|
Basic
and Diluted Earnings per Share
|
|||||||||||||
For
the three months ended
|
For
the six months ended
|
||||||||||||
April
30
|
April
30
|
April
30
|
April
30
|
||||||||||
(millions
of Canadian dollars)
|
2006
|
2005
|
2006
|
2005
|
|||||||||
Basic
Earnings per Share
|
|||||||||||||
Net
income available to common shares ($ millions)
|
$
|
732
|
$
|
599
|
$
|
3,034
|
$
|
1,229
|
|||||
Average
number of common shares outstanding (millions)
|
715.7
|
690.8
|
714.1
|
673.4
|
|||||||||
Basic
earnings per share ($)
|
$
|
1.02
|
$
|
.87
|
$
|
4.25
|
$
|
1.83
|
|||||
Diluted
Earnings per Share
|
|||||||||||||
Net
income available to common shares ($ millions)
|
$
|
732
|
$
|
599
|
$
|
3,034
|
$
|
1,229
|
|||||
Average
number of common shares outstanding (millions)
|
715.7
|
690.8
|
714.1
|
673.4
|
|||||||||
Stock
options potentially exercisable as determined under the treasury
stock
method1
|
6.8
|
5.3
|
6.6
|
5.3
|
|||||||||
Average
number of common shares outstanding - diluted (millions)
|
722.5
|
696.1
|
720.7
|
678.7
|
|||||||||
Diluted
earnings per share ($)
|
$
|
1.01
|
$
|
.86
|
$
|
4.21
|
$
|
1.81
|
Results
by Business Segment
|
|||||||||||||||||||||||||||||||||||||
Canadian
Personal
|
U.S.
Personal and
|
||||||||||||||||||||||||||||||||||||
and
Commercial
|
Commercial
|
Wealth
|
|||||||||||||||||||||||||||||||||||
(millions
of Canadian dollars)
|
Banking
|
Banking
|
Wholesale
Banking1
|
Management
|
Corporate1
|
Total
|
|||||||||||||||||||||||||||||||
April
30
|
April
30
|
April
30
|
April
30
|
April
30
|
April
30
|
April
30
|
April
30
|
April
30
|
April
30
|
April
30
|
April
30
|
||||||||||||||||||||||||||
For
the three months ended
|
2006
|
2005
|
2006
|
2005
|
2006
|
2005
|
2006
|
2005
|
2006
|
2005
|
2006
|
2005
|
|||||||||||||||||||||||||
Net
interest income
|
$
|
1,147
|
$
|
1,030
|
$
|
327
|
$
|
99
|
$
|
76
|
$
|
301
|
$
|
62
|
$
|
156
|
$
|
(185
|
)
|
$
|
(193
|
)
|
$
|
1,427
|
$
|
1,393
|
|||||||||||
Other
income
|
624
|
587
|
134
|
39
|
458
|
303
|
460
|
530
|
10
|
58
|
1,686
|
1,517
|
|||||||||||||||||||||||||
Total
revenue
|
1,771
|
1,617
|
461
|
138
|
534
|
604
|
522
|
686
|
(175
|
)
|
(135
|
)
|
3,113
|
2,910
|
|||||||||||||||||||||||
Provision
for (reversal of) credit losses
|
78
|
91
|
8
|
(7
|
)
|
11
|
13
|
-
|
-
|
(81
|
)
|
(77
|
)
|
16
|
20
|
||||||||||||||||||||||
Non-interest
expenses
|
994
|
925
|
284
|
83
|
321
|
365
|
349
|
530
|
155
|
154
|
2,103
|
2,057
|
|||||||||||||||||||||||||
Income
(loss) before provision for (benefit of) income taxes
|
699
|
601
|
169
|
62
|
202
|
226
|
173
|
156
|
(249
|
)
|
(212
|
)
|
994
|
833
|
|||||||||||||||||||||||
Provision
for (benefit of)income taxes
|
234
|
200
|
60
|
22
|
62
|
76
|
60
|
57
|
(172
|
)
|
(142
|
)
|
244
|
213
|
|||||||||||||||||||||||
Non-controlling
interests
|
-
|
-
|
50
|
21
|
-
|
-
|
-
|
-
|
(3
|
)
|
-
|
47
|
21
|
||||||||||||||||||||||||
Equity
in net income of associated company, net of tax
|
-
|
-
|
-
|
-
|
-
|
-
|
39
|
-
|
(4
|
)
|
-
|
35
|
-
|
||||||||||||||||||||||||
Net
income (loss)
|
$
|
465
|
$
|
401
|
$
|
59
|
$
|
19
|
$
|
140
|
$
|
150
|
$
|
152
|
$
|
99
|
$
|
(78
|
)
|
$
|
(70
|
)
|
$
|
738
|
$
|
599
|
|||||||||||
Total
assets (billions of Canadian dollars)
|
|||||||||||||||||||||||||||||||||||||
-
balance sheet
|
$
|
137.9
|
$
|
123.6
|
$
|
46.5
|
$
|
37.4
|
$
|
165.5
|
$
|
156.6
|
$
|
12.0
|
$
|
26.4
|
$
|
26.7
|
$
|
15.5
|
$
|
388.6
|
$
|
359.5
|
|||||||||||||
-
securitized
|
34.3
|
34.5
|
-
|
-
|
-
|
-
|
-
|
-
|
(9.2
|
)
|
(11.6
|
)
|
25.1
|
22.9
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
31
|
Canadian
Personal
|
U.S.
Personal and
|
||||||||||||||||||||||||||||||||||||
and
Commercial
|
Commercial
|
Wealth
|
|||||||||||||||||||||||||||||||||||
(millions
of Canadian dollars)
|
Banking
|
Banking
|
Wholesale
Banking1
|
Management
|
Corporate1
|
Total
|
|||||||||||||||||||||||||||||||
April
30
|
April
30
|
April
30
|
April
30
|
April
30
|
April
30
|
April
30
|
April
30
|
April
30
|
April
30
|
April
30
|
April
30
|
||||||||||||||||||||||||||
For
the six months ended
|
2006
|
2005
|
2006
|
2005
|
2006
|
2005
|
2006
|
2005
|
2006
|
2005
|
2006
|
2005
|
|||||||||||||||||||||||||
Net
interest income
|
$
|
2,324
|
$
|
2,119
|
$
|
611
|
$
|
99
|
$
|
214
|
$
|
579
|
$
|
240
|
$
|
301
|
$
|
(355
|
)
|
$
|
(294
|
)
|
$
|
3,034
|
$
|
2,804
|
|||||||||||
Other
income
|
1,251
|
1,161
|
207
|
39
|
981
|
595
|
1,024
|
1,048
|
1,584
|
69
|
5,047
|
2,912
|
|||||||||||||||||||||||||
Total
revenue
|
3,575
|
3,280
|
818
|
138
|
1,195
|
1,174
|
1,264
|
1,349
|
1,229
|
(225
|
)
|
8,081
|
5,716
|
||||||||||||||||||||||||
Provision
for (reversal of) credit losses
|
177
|
186
|
15
|
(7
|
)
|
40
|
26
|
-
|
-
|
(102
|
)
|
(175
|
)
|
130
|
30
|
||||||||||||||||||||||
Non-interest
expenses
|
1,979
|
1,849
|
509
|
83
|
716
|
697
|
874
|
1,038
|
315
|
335
|
4,393
|
4,002
|
|||||||||||||||||||||||||
Income
(loss) before provision for (benefit of) income taxes
|
1,419
|
1,245
|
294
|
62
|
439
|
451
|
390
|
311
|
1,016
|
(385
|
)
|
3,558
|
1,684
|
||||||||||||||||||||||||
Provision
for (benefit of) income taxes
|
478
|
420
|
102
|
22
|
135
|
160
|
139
|
114
|
(390
|
)
|
(282
|
)
|
464
|
434
|
|||||||||||||||||||||||
Non-controlling
interests
|
-
|
-
|
87
|
21
|
-
|
-
|
-
|
-
|
(3
|
)
|
-
|
84
|
21
|
||||||||||||||||||||||||
Equity
in net income of associated company, net of tax
|
-
|
-
|
-
|
-
|
-
|
-
|
39
|
-
|
(4
|
)
|
-
|
35
|
-
|
||||||||||||||||||||||||
Net
income (loss)
|
$
|
941
|
$
|
825
|
$
|
105
|
$
|
19
|
$
|
304
|
$
|
291
|
$
|
290
|
$
|
197
|
$
|
1,405
|
$
|
(103
|
)
|
$
|
3,045
|
$
|
1,229
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
32
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
33
|
Net
Income
|
|||||||||||||
For
the three months ended
|
For
the six months ended
|
||||||||||||
April
30
|
April
30
|
April
30
|
April
30
|
||||||||||
(millions
of Canadian dollars)
|
20061
|
2005
|
20062
|
2005
|
|||||||||
Net
income based on Canadian GAAP
|
$
|
738
|
$
|
599
|
$
|
3,045
|
$
|
1,229
|
|||||
Employee
future benefits
|
-
|
(1
|
)
|
2
|
(1
|
)
|
|||||||
Securitizations
|
-
|
(1
|
)
|
-
|
(3
|
)
|
|||||||
Available
for sale securities
|
2
|
1
|
8
|
3
|
|||||||||
Derivative
instruments and hedging activities
|
49
|
(79
|
)
|
16
|
(167
|
)
|
|||||||
Guarantees
|
(6
|
)
|
(6
|
)
|
(12
|
)
|
(9
|
)
|
|||||
Liabilities
and equity
|
29
|
34
|
68
|
63
|
|||||||||
Amortization
of intangible assets
|
(15
|
)
|
(5
|
)
|
(30
|
)
|
(5
|
)
|
|||||
Other
|
5
|
-
|
(21
|
)
|
-
|
||||||||
Income
taxes and net change in income taxes due to the above
items
|
(38
|
)
|
65
|
(13
|
)
|
108
|
|||||||
Non-controlling
interests
|
(8
|
)
|
(17
|
)
|
(14
|
)
|
(40
|
)
|
|||||
Net
income based on U.S. GAAP
|
756
|
590
|
3,049
|
1,178
|
|||||||||
Preferred
dividends
|
12
|
12
|
35
|
18
|
|||||||||
Net
income applicable to common shares based on U.S.
GAAP
|
$
|
744
|
$
|
578
|
$
|
3,014
|
$
|
1,160
|
|||||
Average
number of common shares outstanding (millions)
|
|||||||||||||
Basic
-
U.S. GAAP/Canadian GAAP
|
715.7
|
690.8
|
714.1
|
673.4
|
|||||||||
Diluted
- U.S. GAAP/Canadian GAAP
|
722.5
|
696.1
|
720.7
|
678.7
|
|||||||||
Basic
earnings per share - U.S. GAAP
|
$
|
1.04
|
$
|
.84
|
$
|
4.22
|
$
|
1.72
|
|||||
-
Canadian
GAAP
|
1.02
|
.87
|
4.25
|
1.83
|
|||||||||
Diluted
earnings per share - U.S. GAAP
|
1.03
|
.83
|
4.18
|
1.71
|
|||||||||
-
Canadian
GAAP
|
1.01
|
.86
|
4.21
|
1.81
|
Consolidated
Interim Statement of Comprehensive Income
|
|||||||||||||
For
the three months ended
|
For
the six months ended
|
||||||||||||
April
30
|
April
30
|
April
30
|
April
30
|
||||||||||
(millions
of Canadian dollars)
|
2006
|
2005
|
2006
|
2005
|
|||||||||
Net
income based on U.S. GAAP
|
$
|
756
|
$
|
590
|
$
|
3,049
|
$
|
1,178
|
|||||
Other
comprehensive income (loss), net of income taxes
|
|||||||||||||
Net
change in unrealized gains and losses on available for sale
securities
|
(96
|
)
|
(42
|
)
|
(145
|
)
|
81
|
||||||
Reclassification
to earnings in respect of available for sale securities
|
-
|
-
|
-
|
5
|
|||||||||
Change
in unrealized foreign currency translation gains and
losses
|
159
|
(86
|
)
|
189
|
(33
|
)
|
|||||||
Change
in gains and losses on derivative instruments designated as cash
flow
hedges
|
112
|
(19
|
)
|
191
|
(143
|
)
|
|||||||
Reclassification
to earnings of gains and losses on cash flow hedges
|
3
|
5
|
21
|
10
|
|||||||||
Minimum
pension liability adjustment
|
3
|
(3
|
)
|
3
|
(3
|
)
|
|||||||
Comprehensive
income
|
$
|
937
|
$
|
445
|
$
|
3,308
|
$
|
1,095
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
34
|
As
at
|
As
at
|
As
at
|
||||||||||||||||||||||||||
April
30
|
Oct.
31
|
April
30
|
||||||||||||||||||||||||||
(millions
of Canadian dollars)
|
2006
|
2005
|
2005
|
|||||||||||||||||||||||||
Canadian
|
Adjust-
|
U.S.
|
Canadian
|
Adjust-
|
U.S.
|
Canadian
|
Adjust-
|
U.S.
|
||||||||||||||||||||
GAAP
|
ments
|
GAAP
|
GAAP
|
ments
|
GAAP
|
GAAP
|
ments
|
GAAP
|
||||||||||||||||||||
Assets
|
||||||||||||||||||||||||||||
Cash
resources and other
|
$
|
12,341
|
$
|
-
|
$
|
12,341
|
$
|
13,418
|
$
|
-
|
$
|
13,418
|
$
|
10,854
|
$
|
-
|
$
|
10,854
|
||||||||||
Securities
|
||||||||||||||||||||||||||||
Investment
|
42,847
|
4,238
|
47,085
|
42,321
|
3,898
|
46,219
|
39,884
|
3,973
|
43,857
|
|||||||||||||||||||
Trading
|
69,809
|
-
|
69,809
|
65,775
|
-
|
65,775
|
71,748
|
-
|
71,748
|
|||||||||||||||||||
Securities
purchased under reverse repurchase agreements
|
32,344
|
-
|
32,344
|
26,375
|
-
|
26,375
|
23,727
|
-
|
23,727
|
|||||||||||||||||||
Loans
(net)
|
156,572
|
-
|
156,572
|
152,243
|
-
|
152,243
|
148,802
|
1
|
148,803
|
|||||||||||||||||||
Investment
in TD Ameritrade
|
3,783
|
-
|
3,783
|
|||||||||||||||||||||||||
Trading
derivatives’ market revaluation
|
35,430
|
913
|
36,343
|
33,651
|
674
|
34,325
|
34,949
|
1,595
|
36,544
|
|||||||||||||||||||
Goodwill
|
7,652
|
1,612
|
9,264
|
6,518
|
1,604
|
8,122
|
6,766
|
1,673
|
8,439
|
|||||||||||||||||||
Intangible
assets
|
2,185
|
344
|
2,529
|
2,124
|
338
|
2,462
|
2,421
|
400
|
2,821
|
|||||||||||||||||||
Other
assets
|
25,633
|
(129
|
)
|
25,504
|
22,785
|
22
|
22,807
|
20,393
|
14
|
20,407
|
||||||||||||||||||
Total
assets
|
$
|
388,596
|
$
|
6,978
|
$
|
395,574
|
$
|
365,210
|
$
|
6,536
|
$
|
371,746
|
$
|
359,544
|
$
|
7,656
|
$
|
367,200
|
||||||||||
Liabilities
|
||||||||||||||||||||||||||||
Deposits
|
$
|
252,991
|
$
|
35
|
$
|
253,026
|
$
|
246,981
|
$
|
21
|
$
|
247,002
|
$
|
248,514
|
$
|
(6
|
)
|
$
|
248,508
|
|||||||||
Trading
derivatives’ market revaluation
|
36,295
|
740
|
37,035
|
33,498
|
598
|
34,096
|
34,349
|
984
|
35,333
|
|||||||||||||||||||
Other
liabilities
|
67,963
|
4,262
|
72,225
|
60,224
|
4,037
|
64,261
|
51,634
|
4,317
|
55,951
|
|||||||||||||||||||
Subordinated
notes, debentures and other debt
|
7,748
|
-
|
7,748
|
5,138
|
-
|
5,138
|
5,569
|
(3
|
)
|
5,566
|
||||||||||||||||||
Liabilities
for preferred shares and Capital Trust Securities
|
1,786
|
(1,786
|
)
|
-
|
1,795
|
(1,795
|
)
|
-
|
2,210
|
(2,210
|
)
|
-
|
||||||||||||||||
Total
liabilities
|
366,783
|
3,251
|
370,034
|
347,636
|
2,861
|
350,497
|
342,276
|
3,082
|
345,358
|
|||||||||||||||||||
Non-controlling
interests
|
2,530
|
3,160
|
5,690
|
1,708
|
3,149
|
4,857
|
1,676
|
3,250
|
4,926
|
|||||||||||||||||||
Shareholders’
equity
|
||||||||||||||||||||||||||||
Preferred
shares
|
425
|
536
|
961
|
-
|
545
|
545
|
-
|
960
|
960
|
|||||||||||||||||||
Common
shares
|
6,245
|
39
|
6,284
|
5,872
|
39
|
5,911
|
5,632
|
39
|
5,671
|
|||||||||||||||||||
Contributed
surplus
|
51
|
-
|
51
|
40
|
-
|
40
|
28
|
-
|
28
|
|||||||||||||||||||
Foreign
currency translation
|
(507
|
)
|
507
|
-
|
(696
|
)
|
696
|
-
|
(298
|
)
|
298
|
-
|
||||||||||||||||
Retained
earnings
|
13,069
|
(266
|
)
|
12,803
|
10,650
|
(246
|
)
|
10,404
|
10,230
|
(179
|
)
|
10,051
|
||||||||||||||||
Accumulated
other comprehensive income
|
||||||||||||||||||||||||||||
Net
unrealized gains on available for sale securities
|
-
|
135
|
135
|
-
|
280
|
280
|
-
|
384
|
384
|
|||||||||||||||||||
Foreign
currency translation adjustments
|
-
|
(507
|
)
|
(507
|
)
|
-
|
(696
|
)
|
(696
|
)
|
-
|
(298
|
)
|
(298
|
)
|
|||||||||||||
Derivative
instruments
|
-
|
158
|
158
|
-
|
(54
|
)
|
(54
|
)
|
-
|
128
|
128
|
|||||||||||||||||
Minimum
pension liability adjustment
|
-
|
(35
|
)
|
(35
|
)
|
-
|
(38
|
)
|
(38
|
)
|
-
|
(8
|
)
|
(8
|
)
|
|||||||||||||
Total
shareholders’ equity
|
19,283
|
567
|
19,850
|
15,866
|
526
|
16,392
|
15,592
|
1,324
|
16,916
|
|||||||||||||||||||
Total
liabilities and shareholders’ equity
|
$
|
388,596
|
$
|
6,978
|
$
|
395,574
|
$
|
365,210
|
$
|
6,536
|
$
|
371,746
|
$
|
359,544
|
$
|
7,656
|
$
|
367,200
|
TD
BANK FINANCIAL GROUP • SECOND QUARTER 2006 REPORT TO
SHAREHOLDERS
|
Page
35
|