TD Bank Group is set to cut approximately 2,000 jobs, amounting to 2% of its workforce, as part of a restructuring strategy aimed at cost reduction and enhanced operational efficiency.
The Canadian financial institution, employing around 100,000 individuals, anticipates incurring restructuring charges between C$600m ($434m) and C$700m ($506m) over upcoming quarters, according to chief financial officer Kelvin Tran during the announcement of quarterly results for the period ending 30 April.
The restructuring is projected to achieve savings of C$100m for fiscal year 2025.
This strategic move follows last year’s $3.1bn settlement with US authorities over anti-money laundering (AML) issues, prompting changes within the company’s executive leadership. TD did not disclose whether the job cuts will primarily impact employees in Canada or the US.
In addition, TD plans to dissolve a $3bn portfolio linked to its US point-of-sale financing business, catering to third-party retailers, as CEO Raymond Chun stated this aligns with the bank’s focus on its core operations.
TD’s second-quarter financial results revealed a significant revenue increase, reporting C$22.9bn, marking a 66% rise from the same period last year. Reported diluted earnings per share stood at C$6.27 compared to C$1.35 previously, while adjusted diluted earnings per share were slightly lower at C$1.97, down from C$2.04.
The bank’s reported net income reached C$11.13bn against C$2.56bn in the prior year period, whereas adjusted net income was slightly down at $3.6bn compared with $3.79bn last year.
Canadian Personal and Commercial Banking experienced a net income decline of 4% to C$1.7bn due to increased credit loss provisions and non-interest expenses, although revenues grew by 3% owing to loan and deposit growth.
In the US, retail segment net income for the quarter was C$120m ($89m), reflecting a 76% decrease compared to the previous year. On an adjusted basis, net income fell by 19% to C$967m ($680m).
The wealth management and insurance divisions reported a 14% increase in net income to C$707m, supported by strong revenue growth from higher insurance premiums and fees.
Wholesale Banking’s net income rose by 16% to C$419m due to increased revenue despite higher credit loss provisions and expenses. Adjusted net income saw a modest increase of 1% to C$445m with quarterly revenue reaching C$2.1bn, up by 10%, largely driven by trading-related activities and underwriting fees associated with the sale of its remaining Schwab equity investment.
Chun said: “TD delivered strong results this quarter, with robust trading and fee income in our markets-driven businesses as well as deposit and loan growth in Canadian Personal and Commercial Banking.
“Our US balance sheet restructuring is on track, and we are making consistent progress on AML remediation. We are well positioned as we enter the second half of the year, and we continue to strengthen our Bank by investing in the client experience, enhancing our digital capabilities, and simplifying how we operate to achieve greater speed and execution excellence.”
