TD cuts thousands of jobs, takes restructuring charge as earnings miss
Toronto-Dominion Bank missed analysts’ earnings estimates after setting aside more money than forecast for potentially souring loans and announcing a restructuring charge related to a planned three per cent cut to the lender’s workforce.
Provisions for credit losses totalled $878 million in the fiscal fourth quarter, more than the $844.5 million analysts had expected. The bank earned $1.83 a share on an adjusted basis, it said in a statement Nov. 30, less than the $1.90 average estimate of analysts in a Bloomberg survey.
Toronto-Dominion said it took $266 million in after-tax restructuring charges, falling in line with other Canadian banks, including Royal Bank of Canada, Bank of Montreal and Bank of Nova Scotia, all of which have recently announced job cuts. Toronto-Dominion’s three per cent reduction in its workforce would amount to more than 3,000 positions.
For fiscal 2024, “it will be challenging” for the bank to meet its medium-term adjusted earnings-per-share growth target of seven per cent to 10 per cent and return-on-equity target of more than 16 per cent “as it navigates a complex macroeconomic environment” along with “expected further normalization” in provisions for credit losses, Toronto-Dominion said in the statement.
Adjusted non-interest expenses came in at $7.24 billion for the fourth quarter, more than the $6.89 billion analysts expected.
The bank said it’s still dealing with a United States Department of Justice investigation about its compliance with anti-money-laundering rules. Toronto-Dominion said it doesn’t think that will have a major impact on financial results, but “there is a possibility that the ultimate resolution of legal or regulatory actions may be material to the bank’s consolidated
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