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TD reported quarterly results on Thursday.The Canadian Press

Toronto-Dominion Bank’s fiscal fourth-quarter profit fell 4 per cent, hampered by a restructuring charge and expectations of higher loan losses.

Those costs compounded weaker-than-expected results from each of TD's business lines, capping off a fourth-quarter in which Canada's largest banks have struggled to find ways to boost profits when faced with lower interest rates and slower economic growth.

For the three months that ended Oct. 31, TD earned $2.86-billion, or $1.54 per share, compared with $2.96-billion, or $1.58 per share a year earlier.

Adjusted to exclude certain items, TD said it earned $1.59 per share. On average, analysts expected adjusted earnings per share of $1.74, according to Refinitiv.

TD held its quarterly dividend steady at 74 cents per share.

TD’s share price fell 3 per cent in early trading on the Toronto Stock Exchange on Thursday.

Provisions for credit losses, or the money banks set aside to cover bad loans, spiked 33 per cent higher to $891-million. That was compared with unusually low levels of provisions a year ago, but TD's increase still exceeded analysts' expectations.

"We are seeing a normalization from what in the last few years had been cyclically very, very low rates [of loan losses]," said Riaz Ahmed, TD's chief financial officer, in an interview. "We don't see this as indicating any particular trends to be concerned about in the broader economy."

The bank also took $154-million in restructuring charges, spread across each of its business lines, which Mr. Ahmed described as "normal course adjustments" made to streamline operations and staffing levels.

Profit from Canadian retail banking, which is TD's largest business line, was roughly unchanged from a year earlier, at $1.75-billion. Increased loans and deposits pushed revenue higher, but that was offset by higher loan loss provisions.

U.S. retail banking profit increased 7 per cent to $1.19-billion, thanks to strong results from the bank's investment in TD Ameritrade Holding Corp., which contributed $291-million in profit. Yet profit from core retail banking operations in the U.S. rose only 2 per cent, as falling interest rates squeezed margins on loans.

TD’s capital markets arm reported a sharp drop in profit, which was down 44 per cent to $160-million, largely due to charges related to derivative valuations. But a $23-million restructuring charge also weighed on results.

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