https://www.bnnbloomberg.ca/business/company-news/2025/08/28/td-bank-third-quarter-profit-rises-on-lower-loan-loss-provision/

TD Bank Group swung to a profit in its latest quarter compared to last year as it continues to restructure and recover from anti-money laundering failures.

“This quarter, we made significant progress on our U.S. balance sheet restructuring. We completed the investment portfolio repositioning announced last October and achieved our targeted 10 per cent asset reduction,” Raymond Chun, TD’s chief executive officer, said on an earnings call Thursday.

“The bank also continued to prioritize and execute on our (anti-money laundering) remediation.”

It completed a number of remediation efforts including implementing new anti-money laundering tools, improved investigative capabilities and a newly launched transaction monitoring platform.

“This quarter, we deployed our first machine learning models in our transaction monitoring environment. This tool will continue to improve the effectiveness and efficiency of our program, allowing our AML team to focus their investigative expertise and intelligence,” TD’s U.S. chief Leo Salom said on the same call as Chun.

He added that TD established a new financial crimes risk management subcommittee and new training programs regarding “suspicious customer activity.”

TD was ordered to pay more than US$3-billion in penalties by U.S. regulators last year after pleading guilty to multiple charges related to failures in its anti-money laundering program.

At the time, it also received non-financial sanctions from the U.S. Office of the Comptroller of the Currency that curtailed its growth south of the border after it found the bank’s monitoring program had systemic breakdowns.

The bank reported a third-quarter profit of $3.34 billion, compared with a loss of $181 million in the same quarter last year. The bank says the profit amounted to $1.89 per diluted share for the quarter ended July 31, compared with a loss of 14 cents per diluted share a year earlier.

The lender also reported a $262 million restructuring of its U.S. balance sheet, along with restructuring charges of $333 million.

Salom said the restructuring efforts were undertaken to comply with U.S. asset restraints. The bank’s U.S. assets totalled US$386 billion at the end of the quarter, under the US$434 billion limit.

Earlier this year, TD had announced other restructuring efforts focused on reducing costs, which included cutting two per cent of its workforce.

“We are undertaking a restructuring program to reduce structural costs and create capacity to invest to build the bank of the future. We expect to incur total restructuring charges of $600 million to $700 million pre-tax over several quarters,” Kelvin Tran, TD’s chief financial officer, said on the earnings call Thursday.

The company’s third-quarter results come amid Canada-U.S. trade tensions and uncertainty.

Chun said that global trade dynamics “continue to be fluid” and there is “still much work ahead” with a CUSMA review set for next year.

“While Canadian companies have benefited from that trade agreement, tariffs and especially sector-specific tariffs create business uncertainty and economic distortions with significant impacts to the most exposed sectors,” he said.

The Canadian and U.S. economies have shown resilience despite the uncertainty, but momentum has eased.

“These remain early days. It will likely be a long road before the full impact of tariffs is well understood,” Chun said.

On an adjusted basis, TD says it earned $2.20 per diluted share for its third quarter, up from an adjusted profit of $2.05 per diluted share a year ago.

Analysts on average had expected an adjusted profit of $2.05 per share, according to LSEG Data & Analytics.

Revenue for the quarter totalled $15.3 billion, up from $14.2 billion in the same quarter last year.

The bank’s provisions for credit losses totalled $971 million, down from $1.07 billion last year.

The bank’s Canadian personal and commercial banking segment reported a net income of $1.95 billion in the third quarter, up four per cent from a year earlier.

The wealth management and insurance division reported a net income of $703 million, up 63 per cent from last year.

Its wholesale banking profit was $398 million, up 26 per cent from last year.