In the third quarter of 2023, TD Bank Group (TSX: TD) witnessed a decline in earnings compared to the previous year. The reported earnings saw an 8% decrease from the same period in the previous year, while adjusted earnings slipped by 2%.
“TD delivered strong revenue growth in the quarter and demonstrated the value of its diversified business mix in a challenging economic environment,” said Bharat Masrani, Group President and Chief Executive Officer, TD Bank Group.
Adjusted total revenue came in at $13.0 billion, up from last year’s $11.6 billion. However, TD Bank also disclosed that reported earnings fell to $3 billion from last year’s $3.2 billion, and concurrently, adjusted earnings amounted to $3.7 billion from last year’s $3.8 billion.
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There was a notable decrease in reported diluting earnings per share (EPS), falling from $1.75 to $1.57. Similarly, the adjusted EPS stood at $1.99, down from the previous year’s $2.09 in Q3 2022 and below the estimate of $2.04.
Across the spectrum of personal and commercial banking, TD Bank experienced a 1% decline in net income in comparison to the corresponding period of the prior year. This dip in net income was attributed to increased provisions for credit losses, which saw a jump to $766 million from $351 million.
In TD Bank’s US retail division, reported net income suffered a 9% decline year-over-year. This dip in income was primarily driven by the widely publicized collapse of the First Horizon Corporation merger. The collapse led to acquisition and integration-related expenses amounting to $84 million.
Notably, TD Bank observed significant growth in personal loans within its US retail division, with a notable increase of 11%. Simultaneously, business loan growth exhibited a commendable rise of 9%.
Within the wealth management and insurance division, the net income experienced a decline of 12% when compared to the same quarter of the previous year. TD Bank attributed this decrease to various factors, including the impact of severe weather-related events and reduced transaction revenue within the sector.
In connection with the release of its third quarter results, the company indicated that it intends to repurchase up to 90 million shares under a new buyback program. The program is slated to begin one the current program, for the repurchase of 30 million shares, is complete.
TD last traded at $83.36 on the TSX.
Information for this briefing was found via Sedar and the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
