Big Six bank continues to consider major deal south of border
One of the big six banks said it remains “very open” to a major deal south of the border.
In an interview with BloombergToronto-Dominion Bank chief executive Bharat Masrani said the institution was still interested in a major acquisition, which TD plans to add to its US retail operations.
“When it comes to major mergers and acquisitions in the United States, we are very open,” Masrani said. “If we can find an opportunity that meets all of our criteria, we’ll look at it very seriously, and our capital gives us that flexibility.”
TD currently has approximately $ 12 billion excess capital. That’s well above what the bank needs to maintain “the 11% level 1 common equity ratio that banks typically aim for,” a Bloomberg analysis said. “This gives Toronto-Dominion the financial capacity for a major acquisition.”
Masrani added that TD had weathered the COVID-19 meltdowns relatively well given that it had no exposure to now struggling hedge funds such as Archegos Capital Management.
“We are proud to say that we don’t make bad loans during the good times so that we can make good loans during the bad times,” Masrani said. “This is an important attribute within the bank.”
The bank reported continued strength amid the pandemic, posting profit of $ 3.3 billion and adjusted profit of $ 3.4 billion for the first quarter of the fiscal year. Both figures represented annual increases of 10%, a strength Masrani attributed to TD’s diverse business model.
“Throughout the quarter, we made significant investments to deepen customer relationships in our business, including through enhanced digital capabilities and consulting programs to meet the rapidly evolving needs of those we serve,” said Masrani declared at the end of February.