TD Bank profit rises despite sluggish housing growth
By Cameron French
TORONTO (Reuters) - Toronto-Dominion Bank (TD.TO: Quote) reported a 2 percent increase in quarterly earnings as higher trading, business lending and U.S. banking income offset slowing loan growth in its core Canadian market.
The result, the first from a Canadian bank in a quarter that has seen Canadian housing sales activity slow, was roughly in line with analysts' estimates.
Shares fell 0.9 percent to C$83.25, underperforming TD's Canadian banking peers, which were also in the red on Thursday.
Income from TD's flagship Canadian retail bank rose 5 percent to C$847 million as stronger business lending and lower loan-loss provisions helped offset slowing consumer loan growth.
Canadian home sales activity has been more sluggish so far this year than in 2012, although prices have risen slightly.
Low interest rates have also pinched retail banking income by reducing the margins on loans.
This has prompted TD to bulk up its higher-margin lending in areas such as auto lending and credit cards. During the quarter, TD closed its acquisition of Target Corp's $5.9 billion U.S. credit card portfolio.
TD's U.S. retail banking network produced income of US$392 million, up 9 percent, on the back of loan and deposit growth. Continued...