By Allison Prang
TD Bank reported adjusted earnings Thursday that missed analysts' estimates as a decline in wholesale banking and a rise in insurance claims offset gains from its stake in TD Ameritrade and its U.S. and Canadian operations.
The Toronto-based bank reported net income of C$2.71 billion ($2.1 billion), or C$1.42 a share, compared with C$2.3 billion, or C$1.20 a share this time last year. Adjusted net income rose 11% to C$2.6 billion, or C$1.36 a share.
Analysts polled by Thomson Reuters were predicting C$1.39 a share.
Net income in the bank's Canadian retail division rose 11% to C$1.66 billion. Net income in the bank's U.S. retail division rose 11% to C$776 million.
Net income from the bank's wholesale banking division was C$231 million, down 2.9% from C$238 million a year ago. The drop in wholesale banking was "not particularly concerning," said Riaz Ahmed, TD's chief financial officer, in an interview. He said the drop was largely due to lower trading activity from low volatility in markets.
TD's total revenue rose 6% to C$9.27 billion. The bank also increased its credit-loss provision by 5.5% to C$578 million. Noninterest expenses fell by under half a percent to C$4.83 billion and insurance claims and related expenses rose 5% to C$615 million. The bank said last month it expected the Ameritrade division -- in which it owns more than a 40% stake -- to help earnings for the quarter. The division helped earnings by C$105 million, up 13% from a year ago.
Housing demand and the economy have helped Canadian banks in recent months. TD, the sixth largest bank in North America and second largest bank in Canada, closed a deal in September to buy Scottrade Bank for a reported $1.4 billion in cash.
Shares in TD were unchanged in premarket trading.
--Vipal Monga contributed to this article
Write to Allison Prang at email@example.com