The man responsible for running the division Toronto-Dominion Bank has bet its future on is retiring.
Mike Pedersen, who currently heads TD's U.S. personal and commercial banking arm, announced his retirement late Thursday, but will stay with the bank until summer 2017 to help with the transition.
The role he leaves behind is an important one for the bank. Although Canadian personal and commercial bank currently generates roughly 60 per cent of TD's total profit, the lender has spent almost $20-billion on retail banking acquisitions south of the border since 2004, in hopes that a solid U.S. franchise will deliver future growth.
Because the U.S. division is so important for the bottom line, its head is widely viewed as as potential contender to be the bank's next chief executive officer. Current CEO Bharat Masrani spent nearly a decade in the U.S., starting in Maine and then moving to New Jersey after TD bought Commerce Bancorp for $8.5-billion (U.S.) in 2008.
Mr. Pedersen took control of the U.S. arm in 2013, shortly after Mr. Masrani was named the bank's next CEO. He will be replaced by Greg Braca, currently TD's head of corporate and specialty banking. Mr. Braca, who joined TD in 2002 and used to run retail and commercial banking in New York., starts as the U.S. arm's COO but will take over the unit next June.
The retirement marks another major change among TD's senior ranks. Last December former Canadian banking head Tim Hockey announced he was leaving to take over TD Ameritrade, the discount brokerage that TD joint owns.
Mr. Pedersen is also leaving as TD shifts gears under its new CEO. Mr. Masrani took over in November, 2014, and he largely spent his first year cutting costs and incurred two major restructuring charges worth $686-million. In the year since, however, he's put more of his stamp on the bank.
Recent changes have included emphasizing TD's wealth management business, growing its capital markets division and expanding its footprint as a North American bank. On the last front, earlier this week the lender teamed up with TD Ameritrade for a $4-billion joint bid for discount brokerage Scottrade, which also has a banking arm.
"One thing that has changed about TD over the last few years, and that we are very proud of, is that we are becoming much more North American," Mr. Masrani said at an investor conference in September.