The Toronto-Dominion Bank ( TD ) reported its fiscal
first quarter 2013 (ended Jan 31) adjusted earnings of C$2.00 per
share, which compared favorably with the year-ago earnings of
C$1.86. Moreover, adjusted net income came in at C$1.92 billion
($1.93 billion), up 8.7% from the year-ago period.CDN IMPL BK (CM): Free Stock Analysis ReportEPOCH HLDG CP (EPHC): Free Stock Analysis
ReportTORONTO DOM BNK (TD): Free Stock Analysis
ReportTo read this article on Zacks.com click here.Zacks Investment
Improved results were driven by growth in revenue as well as
strong assets and profitability ratio in the quarter. Yet, higher
operating expenses were the primary headwinds.
On a GAAP basis, net income for fiscal fourth quarter came in at
C$1.80 billion ($1.81billion), surging 21.1% year over year.
Behind the Headlines
In the reported quarter, total revenues (on adjusted basis) were
C$5.94 billion ($5.98 billion), up 4.0% year over year. Operating
revenue came in at C$5.97 billion ($6.01 billion), growing 5.8%
from the prior-year quarter.
Adjusted net interest income surged 3.9% year over year to C$3.85
billion ($3.88 billion). Moreover, adjusted non-interest income
came in at C$2.09 billion ($2.10 billion), advancing 4.2% from the
Adjusted non-interest expenses were C$3.30 billion ($3.32
billion), rising 4.5% year over year. Adjusted efficiency ratio
stood at 55.6%, deteriorating marginally from 55.3% as of Jan 31,
2012. A rise in efficiency ratio indicates fall in
Total provision for credit losses were C$385 million ($387.6
million), falling 13.5% from the comparable quarter last
Total assets came in at C$818.5 billion ($816.7 billion) as of Jan
31, 2013, up 5.0% year over year. Return on common equity, as
adjusted, was 16.4% in the reported quarter, marginally below 16.8%
as of Jan 31, 2012.
In the reported quarter, Toronto-Dominion signed a definitive
agreement to acquire Epoch Investment Partners,
Inc. ( EPHC ), a fully-owned
subsidiary of Epoch Holding Corporation. The transaction is
anticipated to close in the second quarter of 2013.
Concurrent with the earnings release, Toronto-Dominion declared a
quarterly dividend of C$0.81 per share. The dividend will be paid
on Apr 30, to shareholders of record at the close of business on
Apr 3. This represents an increase of C$0.04 per share from the
Performances of Other Canadian Banks
Royal Bank of Canada ( RY ) reported net income
from continuing operations of C$2.1 billion ($1.9 billion) for
fiscal first quarter 2013 (Jan 31), up 11% the year-ago period.
Results reflect a rise in revenue aided by higher net interest and
non-interest income. Yet, the key negatives were deteriorating
credit quality and elevated non-interest expenses.
Canadian Imperial Bank of Commerce ( CM ) reported its fiscal
first quarter 2013 (ended Jan 31) adjusted earnings per share of
C$2.15. This was up 5.4% from the prior-quarter earnings of C$2.04.
Augmented top-line and robust asset position were the primary
earnings drivers. Yet, rising operating expenses partially dented
We expect Toronto-Dominion's acquisition activities to positively
impact its financials in the long run. Further, the company's
capital deployment activities are going to boost investors'
confidence in it. However, the persistently low interest rate
environment, weak economic recovery and stringent regulatory
requirements will remain a drag on its financials.
Toronto-Dominion currently retains a Zacks Rank #3 (Hold).