Canada's TD Bank lowers earnings target in home market
By Matt Scuffham
TORONTO (Reuters) - Toronto-Dominion Bank (TD.TO: Quote) on Thursday reported fourth-quarter profit in line with market expectations and lowered its earnings growth target in Canada, blaming sluggish economic growth in its domestic market.
Chief Executive Bharat Masrani said the bank had pegged back its earnings target in Canada in the expectation that the country's economic output will remain modest in 2017 and 2018.
"We think it is prudent to moderate our medium term growth expectation for the Canadian retail segment from the 7 percent plus target identified at our investor day to mid-single digits," he told analysts on a conference call.
Canada's second biggest bank said earnings, excluding one-off items, rose to C$1.22 per share in the fourth quarter to Oct. 31, from C$1.14 a year earlier, matching the average forecast of analysts, according to Thomson Reuters I/B/E/S.
Total net income, excluding one-off items, rose to C$2.35 billion from C$2.18 billion the year before. Net income at its Canadian business was flat at C$1.5 billion while net income at its U.S. retail business rose by 18 percent to C$701 million.
Analysts said the bank's performance contrasted negatively with forecast-busting results by CIBC CM.TO on Thursday and Bank of Nova Scotia (BNS.TO: Quote) earlier this week.
Shares in TD closed on Thursday down 0.8 percent.
The bank said its core tier 1 ratio, a key measure of its financial strength, stood at 10.4 percent at the end of October, the lowest of the four major Canadian banks to report fourth-quarter earnings so far. Continued...