TD profit more than doubles

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Toronto-Dominion Bank made $1.18-billion in the second quarter, up from $545-million a year ago.

The gain came as the bank's U.S. operations improved their performance amid a slumping American economy, while more Canadians paid back their loans.

"Our U.S. operations delivered improving results despite an economic picture that remains less robust than what we're seeing in Canada," TD chief executive officer Ed Clark said in a statement.

The bank had fewer loan losses across all of its businesses - the lowest level of loan losses in six quarters, Mr. Clark said.

TD's Canadian retail banking operations made a record $761-million in the quarter, up 29 per cent. Provisions for credit losses dropped 10 per cent, reflecting better loan repayment in Canada.

"Loan losses have turned a corner and it seems that the economic recovery is taking hold in Canada," Mr. Clark said.

Profit at the wealth management division rose 42 per cent, to $111-million, amid a rebound in the equity markets. That drove a rise in trading volumes at its online brokerage and investing activity from clients, which boosted revenue from fees.

The bank's U.S. retail banking business made $241-million, up 41 per cent on an adjusted basis. TD, which has been expanding in the U.S. said provisions for credit losses in the U.S. were down 37 per cent, to $162-million, as more loans were paid back south of the border.

TD's investment banking arm had profit of $220-million, up 27 per cent. The bank saw softer interest rate and credit trading revenue as the market "normalized" from a year ago, TD said.

As well, TD booked an adjusted net loss of $159-million in its corporate operations, which was $79-million more than last year. TD said the higher loss was due to higher hedging costs, an increase in corporate expenses and lower securitization gains.

TD's results were slightly below analysts' expectations. The bank made $1.36 per share, but the Street had been expecting earnings of $1.38 to $1.40 per share.

"Domestic and US retail banking earnings were well above our expectations, while wholesale and corporate earnings were below," Andre-Philippe Hardy, an analyst with RBC, said in a research note to clients.