6-K
TORONTO DOMINION BANK (TD)
FORM
6-K
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington,
D.C. 20549
______________________________
______________________________
REPORT OF FOREIGN PRIVATE
ISSUER
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
For the month of February,
2026
Commission File Number:
001-14446
______________________________
The Toronto-Dominion Bank
(Translation of registrant's name into English)
______________________________
c/o General Counsel’s Office
P.O. Box 1
,
Toronto Dominion Centre
,
Toronto
,
Ontario
,
M5K 1A2
(Address of principal executive offices)
Indicate by check mark whether the registrant
files or will file annual reports under cover
of Form 20-F or Form 40-F:
Form 20-F
☐
Form 40-F
☑
This Form 6-K, excluding Exhibit 99.4, Exhibit
99.5 and Exhibit 99.6 hereto, is incorporated by
reference into all outstanding Registration Statements
of The Toronto-
Dominion Bank filed with the U.S. Securities
and Exchange Commission.
EXHIBIT INDEX
Exhibit
Description
99.1
Quarter 2026 Report to Shareholders
99.2
99.3
Return on Assets and Equity to Assets Ratio
99.4
99.5
99.6
101
Interactive Data File (formatted as Inline
XBRL)
104
Cover Page Interactive Data File (formatted
as Inline XBRL and contained in Exhibit
101)
FORM 6-K
SIGNATURES
Pursuant to the requirements of the Securities
Exchange Act of 1934, the registrant
has duly caused this report to be signed on
its behalf by the undersigned, thereunto
duly
authorized.
THE TORONTO-DOMINION BANK
DATE:
February 26, 2026
By:
/s/ Sue-Anne Fox
Name:
Sue-Anne Fox
Title:
Associate Vice President, Legal,
Treasury and
Corporate Securities
ex991
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 1
1
2
3
4
TD Bank Group Reports First Quarter 2026 Results
Report to Shareholders
•
Three months ended January 31, 2026
The financial information in this document is reported
in Canadian dollars and is based on
the Bank’s unaudited Interim Consolidated
Financial Statements
prepared in accordance with International Financial
Reporting Standards (IFRS) as issued by the
International Accounting Standards Board
(IASB), unless
otherwise noted. Certain comparative amounts
have been revised to conform with the presentation
adopted in the current period.
Reported results conform with generally accepted
accounting principles (GAAP), in accordance
with IFRS. Adjusted results are non-GAAP financial
measures.
For additional information about the Bank’s use of
non-GAAP financial measures, refer to “Significant
Events”,
“Non-GAAP and Other Financial
Measures” in the
“How We Performed”,
or “How Our Businesses Performed” sections
of this document.
FIRST QUARTER FINANCIAL HIGHLIGHTS,
compared with the first quarter last year:
●
Reported diluted earnings per share were
$2.34, compared with $1.55.
●
Adjusted diluted earnings per share were
$2.44, compared with $2.02.
●
Reported net income was $4,043 million,
compared with $2,793 million.
●
Adjusted net income was $4,216 million,
compared with $3,623 million.
FIRST QUARTER ADJUSTMENTS (ITEMS OF
NOTE)
The first quarter reported earnings figures
included the following items of note:
●
Amortization of acquired intangibles
of $34 million ($26 million after tax or 1
cent per share), compared with $61 million
($52 million after tax or
3 cents per share) in the first quarter last
year.
●
Impact from the terminated First Horizon
Corporation (FHN) acquisition-related
capital hedging strategy of $44 million ($32
million after tax or
2 cents per share), compared with $54 million
($41 million after tax or 2 cents per
share) in the first quarter last year.
●
Restructuring charges of $200 million
($148 million after tax or 9 cents per share).
●
Federal Deposit Insurance Corporation
(FDIC)
special assessment of ($44)
million (($33) million after tax or (2) cents
per share).
TORONTO
, February 26, 2026
– TD Bank Group (“TD” or the “Bank”)
today announced its financial results for the
first quarter ended January 31, 2026.
Reported
earnings were $4.0 billion,
up 45% compared with the first quarter last
year, and adjusted earnings were $4.2 billion, up 16%.
“TD delivered strong first quarter results, including
record adjusted earnings and significant
year
‑
over
‑
year adjusted return on equity growth,
reflecting momentum
across our businesses as we advance our
Investor Day goals. We achieved robust trading
and fee income growth in our markets-driven
businesses, volume
growth in Canadian Personal and Commercial
Banking, and margin expansion,” said
Raymond Chun, Group President and
CEO, TD Bank Group. “Across TD, our
colleagues are driving deeper relationships,
helping us build a simpler and faster bank,
with disciplined execution.”
Canadian Personal and Commercial
Banking delivered record revenue,
earnings, deposit and loan volumes
Canadian Personal and Commercial
Banking net income was a record $2,044
million, an increase of 12% compared
with the first quarter last year, reflecting
higher pre-tax, pre-provision earnings (PTPP)
,
,
an increase of 7% year-over-year, and lower provisions
for credit losses (PCL). Revenue was a record
$5,421 million, an increase of 5% year-over-year, primarily
reflecting increased loan and deposit
volumes.
Canadian Personal Banking made significant
progress in deepening client relationships,
achieving its highest quarterly credit
card acquisitions in over a decade,
driven by record existing client pre-approvals
and new client credit card deepening rates. In
addition, the business also delivered
simpler and faster client and
colleague experiences with the national expansion
of its Branch Virtual Assistant, a GenAI Knowledge
Management tool, and the initial scaling of
an agentic AI
capability in Real Estate Secured Lending
to accelerate speed-to-decision.
Canadian Business Banking delivered
strong loan and non-term deposit growth
this
quarter, supported by continued expansion of its distribution
footprint. Small Business Banking also
saw continued growth in chequing accounts,
driven by
compelling client offers and strong frontline engagement.
U.S. Banking sustained business momentum
and executed against critical deliverables
U.S. Banking
reported net income was $1,040 million
(US$747 million),
an increase of $897 million (US$642
million) year-over-year. On an adjusted basis,
net
income was $1,007 million (US$723
million), an increase of $168 million (US$129
million) year-over-year, reflecting the impact of U.S. balance
sheet restructuring
activities and lower PCL, partially offset by higher
governance and control investments, including
costs for U.S. BSA/AML remediation and
higher employee-
related expenses.
This quarter, U.S. Banking sustained its momentum, supported
by growth across core lending portfolios
,
including record Bankcard digital sales
and robust year-
over-year growth in client assets within
U.S. Wealth. Conversion of the Nordstrom
credit card servicing platform has been
completed, enhancing scale to support
the U.S. credit card franchise.
Wealth Management and Insurance delivered record
earnings and assets reflecting strong
contributions from both business lines
Wealth Management and Insurance net income
was $757 million, an increase of $77 million
year-over-year, driven by record assets, strong transaction
revenue
and insurance premiums growth.
1
PTPP is a non-GAAP financial measure, calculated by subtracting Canadian Personal and Commercial Banking
segment’s reported non-interest expenses from reported revenue.
Reported revenue – Q1 2026: $5,421 million, Q1 2025: $5,149 million. Reported non-interest expenses – Q1 202
6: $2,147 million, Q1 2025: $2,086 million. PTPP – Q1 2026:
$3,274 million, Q1 2025: $3,063 million.
2
For additional information about the Bank’s use of non-GAAP financial measures, refer to “Non-GAAP
and Other Financial Measures” in the “How We Performed” section of this
document.
3
Effective the first quarter of 2026, the Bank renamed its U.S. Retail segment to U.S. Banking to better
reflect the segment’s financial products and services. U.S. Banking net income
excludes earnings of $199 million (US$142 million) from the Bank’s investment in The Charles Schwab
Corporation in the first quarter last year.
4
Core loan growth is defined as growth in average loan volumes excluding the impact of the loan portfolios identified
for sale or run-off under our U.S. balance sheet restructuring program.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 2
5
6
Wealth Management delivered strong performance
in the quarter, with trades per day in TD Direct Investing
increasing 10% year-over-year, reflecting the strength
of TD’s comprehensive trading platforms. TD Wealth unified
its two discretionary businesses within
Private Wealth Management, simplifying the business
and
positioning it for scalable growth. This quarter, TD Insurance
continued to strengthen its position as Canada’s leading
digital, direct insurer
,
,
with 80% of clients
digitally engaged. TD Insurance issued another
innovative catastrophe bond, the first in
the Canadian market to provide protection
against aggregate losses from
small and medium-sized catastrophe events.
Wholesale Banking delivered record
revenue and earnings
Wholesale Banking reported net income of
$561 million for the quarter, an increase of $262 million
year-over-year, primarily reflecting higher revenues, partially
offset by higher PCL and non-interest expenses. On
an adjusted basis, net income was a record
$561 million, an increase of $221 million
year-over-year. Revenue
for the quarter was a record $2,470 million, an
increase of 24% year-over-year, driven by strong execution
across Global Markets, and Corporate
and Investment
Banking.
TD Securities advanced its strategy by leveraging
its integrated platform to deepen client relationships,
driving diversified revenue across Global
Markets,
and
Corporate and Investment Banking. This quarter, TD Securities
scaled prime services with the launch of
its U.S. and European synthetic prime offering.
In addition,
Wholesale Banking maintained disciplined execution,
focusing on moderated expense growth
and improved return on equity.
Capital
TD’s Common Equity Tier 1 Capital ratio was 14.5%.
Conclusion
“As our clients navigate an increasingly complex
landscape, we are investing in talent,
technology and new capabilities to support
their financial goals. We are
deploying AI-enabled applications across
TD, enhancing how we work, and creating
new, intuitive and personalized experiences for our
clients. Our colleagues
remain the source of our strength, and
I thank them for their dedication to our
clients and the Bank,” added Chun.
The foregoing contains forward-looking statements. Please refer to the “Caution Regarding Forward-Looking Statements”
on page 4.
5
Leading Digital Insurer: Based on comparison of digital adoption metrics as published by other major insurer.
6
Leading Direct Insurer: Rankings based on data compiled from MSA Research for the year ended December 31,
- Excludes public insurance entities (Insurance Corporation of British
Columbia, Manitoba Public Insurance, and Saskatchewan Auto Fund).
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 3
ENHANCED DISCLOSURE TASK FORCE
The Enhanced Disclosure Task Force (EDTF) was established by the Financial
Stability Board (FSB) in 2012 to identify
fundamental disclosure principles,
recommendations and leading practices to enhance
risk disclosures of banks. The index
below includes the recommendations (as
published by the EDTF) and
lists the location of the related EDTF disclosures
presented in the first quarter 2026 Report to
Shareholders (RTS), Supplemental Financial
Information (SFI), or
Supplemental Regulatory Disclosures (SRD).
Information on TD’s website, SFI, and SRD is not
and should not be considered incorporated
herein by reference
into the first quarter 2026 RTS, Management’s Discussion
and Analysis, or the Interim Consolidated
Financial Statements. Certain disclosure references
have
been made to the Bank’s 2025
Annual Report.
Type of
Risk
Topic
EDTF Disclosure
Page
RTS
First
Quarter
2026
SFI
First
Quarter
2026
SRD
First
Quarter
2026
Annual Report
2025
General
1
Present all related risk information together in any particular report.
Refer to below for location of disclosures
2
The bank’s risk terminology and risk measures and present key parameter
values used.
92-99, 103, 108,
110, 112, 123-126
3
Describe and discuss top and emerging risks.
82-91
4
Outline plans to meet each new key regulatory ratio once applicable rules
are finalized.
29, 42
78, 120
Risk
Governance
and Risk
Management
and
Business
Model
5
Summarize the bank’s risk management organization, processes, and key
functions.
93-97
6
Description of the bank’s risk culture and procedures applied to support the
culture.
92-93
7
Description of key risks that arise from the bank’s business models and
activities.
77, 92, 98-127
8
Description of stress testing within the bank’s risk governance and capital
frameworks.
75, 97-98, 106,
123
Capital
Adequacy
and Risk
Weighted
Assets
9
Pillar 1 capital requirements and the impact for global systemically important
banks.
26-29, 73
1-3, 6
72-74, 79, 235
10
Composition of capital and reconciliation of accounting balance sheet to the
regulatory balance sheet.
1-3, 5
72
11
Flow statement of the movements in regulatory capital.
4
12
Discussion of capital planning within a more general discussion of
management’s strategic planning.
73-76, 123
13
Analysis of how risk-weighted asset (RWA) relate to business activities
and
related risks.
9-15
76-77
14
Analysis of capital requirements for each method used for calculating RWA.
13
100-101, 103,
105-106
15
Tabulate credit risk in the banking book
for Basel asset classes and major
portfolios.
36-53, 59-65
16
Flow statement reconciling the movements of RWA by risk type.
18-19
17
Discussion of Basel III back-testing requirements.
80
102, 106, 110-111
Liquidity
18
The bank’s management of liquidity needs and liquidity reserves.
35-39
112-114, 116
-117
Funding
19
Encumbered and unencumbered assets in a table by balance sheet
category.
37
115, 229
20
Tabulate consolidated total assets, liabilities
and off-balance sheet
commitments by remaining contractual maturity at the balance sheet date.
42-44
120-122
21
Discussion of the bank’s funding sources and the bank’s funding strategy.
37-42
118-120
Market Risk
22
Linkage of market risk measures for trading and non-trading portfolio and
balance sheet.
32
104
23
Breakdown of significant trading and non-trading market risk factors.
32, 34
104, 106-108
24
Significant market risk measurement model limitations and validation
procedures.
33
105-108, 110-111
25
Primary risk management techniques beyond reported risk measures and
parameters.
33
105-108
Credit Risk
26
Provide information that facilitates users’ understanding of the bank’s credit
risk profile, including any significant credit risk concentrations.
23-26, 60-66
23-38
1-5, 13, 18,
20-70, 72-80
59-71, 99-103,
184-191, 201,
203-204, 233-234
27
Description of the bank’s policies for identifying impaired loans.
65
68, 160-161, 167-
168, 191
28
Reconciliation of the opening and closing balances of impaired loans in the
period and the allowance for loan losses.
24, 62-64
27, 31
66, 187-189
29
Analysis of the bank’s counterparty credit risks that arise from derivative
transactions.
54-55, 66-70
101, 171-172,
195-197,
201, 203-204
30
Discussion of credit risk mitigation, including collateral held for all sources of
credit risk.
102, 164, 171-172
Other Risks
31
Description of ‘other risk’ types based on management’s classifications and
discuss how each one is identified, governed, measured, and managed.
108-112, 123-127
32
Discuss publicly known risk events related to other risks.
70-71
90-91, 227-229
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 4
TABLE OF CONTENTS
MANAGEMENT’S DISCUSSION AND ANALYSIS
4
Caution Regarding Forward-Looking Statements
45
Securitization and Off-Balance Sheet Arrangements
5
Financial Highlights
45
Accounting Policies and Estimates
6
Significant Events
45
Changes in Internal Control over Financial
Reporting
6
Update on the Remediation of the U.S. Bank
Secrecy Act/Anti-Money
46
Glossary
Laundering Program and Enterprise AML Program
8
How We Performed
INTERIM CONSOLIDATED FINANCIAL STATEMENTS
11
Financial Results Overview
49
Interim Consolidated Balance Sheet
14
How Our Businesses Performed
50
Interim Consolidated Statement of Income
21
Quarterly Results
51
Interim Consolidated Statement of Comprehensive
Income
22
Balance Sheet Review
52
Interim Consolidated Statement of Changes
in Equity
23
Credit Portfolio Quality
53
Interim Consolidated Statement of Cash
Flows
26
Capital Position
54
Notes to Interim Consolidated Financial Statements
30
Risk Factors and Management
30
Managing Risk
74
SHAREHOLDER AND INVESTOR INFORMATION
MANAGEMENT’S DISCUSSION AND ANALYSIS
OF OPERATING
PERFORMANCE
This Management’s Discussion and Analysis (MD&A)
is presented to enable readers
to assess material changes in the financial
condition and operating results of
TD Bank Group (“TD” or the “Bank”) for the
three months ended January 31, 2026, compared
with the corresponding periods shown. This
MD&A should be read in
conjunction with the Bank’s unaudited Interim
Consolidated Financial Statements included
in this Report to Shareholders and with
the 2025
Annual Consolidated
Financial Statements and 2025 MD&A.
This MD&A is dated February 25, 2026.
Unless otherwise indicated, all amounts are
expressed in Canadian dollars and
have been primarily derived from the Bank’s
2025 Annual Consolidated Financial Statements
or Interim Consolidated Financial Statements,
prepared in
accordance with IFRS as issued by the
IASB. Note that certain comparative amounts
have been revised to conform with the presentation
adopted in the current
period. Additional information relating
to the Bank, including the Bank’s 2025
Annual Information Form, is available
on the Bank’s website at http://www.td.com as
well as on SEDAR+
at http://www.sedarplus.ca and on the SEC’s website at http://www.sec.gov (EDGAR
filers section).
Caution Regarding Forward-Looking Statements
From time to time, the Bank (as defined in this document) makes written and/or oral forward-looking statements, including
in this document, in other filings with Canadian regulators or the United States (U.S.) Securities
and
Exchange Commission (SEC), and in other communications. In addition, representatives of the
Bank may make forward-looking statements orally to analysts, investors, the media, and others. All such
statements are made
pursuant to the “safe harbour” provisions of, and are intended to be forward-looking statements
under, applicable Canadian and U.S. securities legislation, including the U.S.
Private Securities Litigation Reform Act
of 1995.
Forward-looking statements include, but are not limited to, statements made in this document,
the Management’s Discussion and Analysis (“2025 MD&A”) in the Bank’s 2025 Annual Report under the heading “Economic
Summary and Outlook”, under the headings “Key Priorities for 2026” and “Operating Environment and
Outlook” for the Canadian Personal and Commercial Banking, U.S. Banking, Wealth Management and Insurance,
and
Wholesale Banking segments, and under the heading “2025 Accomplishments and Focus for 2026”
for the Corporate segment, and in other statements regarding the Bank’s objectives and priorities for 2026 and
beyond
and strategies to achieve them, the regulatory environment in which the Bank operates, and the Bank’s anticipated
financial performance.
Forward-looking statements are typically identified by words such as “will”, “would”, “should”, “believe”,
“expect”, “anticipate”, “intend”, “estimate”, “forecast”, “outlook”, “plan”, “goal”, “target”, “possible”,
“potential”,
“predict”, “project”, “may”, and “could” and similar expressions or variations thereof, or the negative thereof,
but these terms are not the exclusive means of identifying such statements. By their very
nature, these forward-
looking statements require the Bank to make assumptions and are subject to inherent risks and
uncertainties, general and specific. Especially in light of the uncertainty related to the physical, financial,
economic, political,
and regulatory environments, such risks and uncertainties – many of which are beyond the Bank’s control
and the effects of which can be difficult to predict – may cause actual results to differ materially from the
expectations expressed in the forward-looking statements.
Risk factors that could cause, individually or in the aggregate, such differences include: strategic, credit,
market (including equity, commodity, foreign exchange, interest rate, and credit spreads), operational (including
technology, cyber security, process, systems, data, third-party, fraud, infrastructure, insider and conduct), model, insurance, liquidity, capital adequacy, compliance and legal, financial crime, reputational, environmental and
social, and other risks. Examples of such risk factors include general business and economic conditions
in the regions in which the Bank operates; geopolitical risk (including policy, trade and tax-related risks and the
potential impact of any new or elevated tariffs or any retaliatory tariffs); inflation, interest rates and recession uncertainty; regulatory
oversight and compliance risk; risks associated with the Bank’s ability to satisfy the terms
of the global resolution of the investigations into the Bank’s U.S.
Bank Secrecy Act
(BSA)/anti-money laundering (AML) program; the impact of the global resolution of the investigations
into the Bank’s U.S. BSA/AML
program on the Bank’s businesses, operations, financial condition, and reputation; the ability of the Bank to execute
on long-term strategies, shorter-term key strategic priorities, including the successful completion of
acquisitions and dispositions and integration of acquisitions, the ability of the Bank to achieve its financial
or strategic objectives with respect to its investments, business retention plans, and other strategic
plans; technology
and cyber security risk (including cyber-attacks, data security breaches or technology failures) on the
Bank’s technologies, systems and networks, those of the Bank’s customers (including their own devices), and third
parties providing services to the Bank; data risk; model risk; fraud activity; insider risk; conduct
risk; the failure of third parties to comply with their obligations to the Bank or its affiliates, including
relating to the care and
control of information, and other risks arising from the Bank’s use of third-parties; the impact of new and changes
to, or application of, current laws, rules and regulations, including without limitation consumer
protection laws
and regulations, tax laws, capital guidelines and liquidity regulatory guidance; increased competition
from incumbents and new entrants (including Fintechs and big technology competitors); shifts in consumer
attitudes and
disruptive technology; environmental and social risk (including climate-related risk); exposure related to
litigation and regulatory matters; ability of the Bank to attract, develop, and retain key talent;
changes in foreign
exchange rates, interest rates, credit spreads and equity prices; downgrade, suspension or withdrawal
of ratings assigned by any rating agency, the value and market price of the Bank’s common shares and other securities
may be impacted by market conditions and other factors; the interconnectivity of financial institutions
including existing and potential international debt crises; increased funding costs and market volatility due to
market
illiquidity and competition for funding; critical accounting estimates and changes to accounting standards,
policies, and methods used by the Bank; and the occurrence of natural and unnatural catastrophic
events and
claims resulting from such events.
The Bank cautions that the preceding list is not exhaustive of all possible risk factors and other
factors could also adversely affect the Bank’s results. For more detailed information, please refer to the “Risk
Factors and
Management” section of the 2025 MD&A, as may be updated in subsequently filed quarterly reports to shareholders
and news releases (as applicable) related to any events or transactions discussed under the headings
“Significant Events”, “Significant and Subsequent Events” or “Update on U.S. Bank Secrecy
Act (BSA)/Anti-Money Laundering (AML) Program Remediation and Enterprise AML Program Improvement
Activities“ in the
relevant MD&A, which applicable releases may be found on www.td.com. All such factors, as well as other
uncertainties and potential events, and the inherent uncertainty of forward-looking statements, should be
considered carefully when making decisions with respect to the Bank. The Bank cautions readers
not to place undue reliance on the Bank’s forward-looking statements.
Material economic assumptions underlying the forward-looking statements contained in this document are set
out in the 2025 MD&A under the headings “Economic Summary and Outlook” and “Significant
Events”, under
the headings “Key Priorities for 2026” and “Operating Environment and Outlook” for the Canadian
Personal and Commercial Banking, U.S. Banking, Wealth Management and Insurance, and Wholesale Banking segments,
and under the heading “2025 Accomplishments and Focus for 2026” for the Corporate segment,
each as may be updated in subsequently filed quarterly reports to shareholders and news releases (as
applicable).
Any forward-looking statements contained in this document represent the views of management only as
of the date hereof and are presented for the purpose of assisting the Bank’s shareholders and analysts in
understanding the Bank’s financial position, objectives and priorities and anticipated financial performance as at and
for the periods ended on the dates presented, and may not be appropriate for other
purposes. The Bank
does not undertake to update any forward-looking statements, whether written or oral, that may be
made from time to time by or on its behalf, except as required under applicable securities legislation.
This document was reviewed by the Bank’s Audit Committee and was approved by the Bank’s Board of Directors,
on the Audit Committee’s recommendation, prior to its release.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 5
TABLE 1: FINANCIAL HIGHLIGHTS
(millions of Canadian dollars, except
as noted)
For the three months ended
January 31
October 31
January 31
2026
2025
2025
Results of operations
Total revenue – reported
$
16,585
$
15,494
$
14,049
Total revenue – adjusted
1
16,629
16,028
15,030
Provision for (recovery of) credit losses
1,039
982
1,212
Insurance service expenses (ISE)
1,622
1,602
1,507
Non-interest expenses – reported
8,753
8,808
8,070
Non-interest expenses – adjusted
1
8,563
8,540
7,983
Net income – reported
4,043
3,280
2,793
Net income – adjusted
1
4,216
3,905
3,623
Financial position
(billions of Canadian dollars)
Total loans net of allowance for loan losses
$
958.5
$
953.0
$
965.3
Total assets
2,099.3
2,094.6
2,093.6
Total deposits
1,245.1
1,267.1
1,290.5
Total equity
125.6
127.8
119.0
Total risk-weighted assets
2
635.2
636.4
649.0
Financial ratios
Return on common equity (ROE) – reported
3
13.6
%
10.7
%
10.1
%
Return on common equity – adjusted
1
14.2
12.8
13.2
Return on tangible common equity (ROTCE)
1,3
16.3
12.9
13.4
Return on tangible common equity – adjusted
1
16.9
15.4
17.2
Efficiency ratio – reported
3
52.8
56.8
57.4
Efficiency ratio – adjusted, net of ISE
1,3,4
57.1
59.2
59.0
Provision for (recovery of) credit losses
as a % of net
average loans and acceptances
0.43
0.41
0.50
Common share information – reported
(Canadian dollars)
Per share earnings
Basic
$
2.35
$
1.82
$
1.55
Diluted
2.34
1.82
1.55
Dividends per share
1.08
1.05
1.05
Book value per share
3
68.20
68.78
61.61
Closing share price (TSX)
5
127.26
115.16
82.91
Shares outstanding (millions)
Average basic
1,680.3
1,698.2
1,749.9
Average diluted
1,684.7
1,701.5
1,750.7
End of period
1,671.2
1,689.5
1,751.7
Market capitalization (billions of Canadian dollars)
$
212.7
$
194.6
$
145.2
Dividend yield
3
3.5
%
3.9
%
5.4
%
Dividend payout ratio
3
45.9
57.6
67.8
Price-earnings ratio
3
10.3
10.0
17.5
Total shareholder return (1 year)
3
60.0
56.7
6.9
Common share information – adjusted
(Canadian dollars)
1
Per share earnings
Basic
$
2.45
$
2.19
$
2.02
Diluted
2.44
2.18
2.02
Dividend payout ratio
44.0
%
47.9
%
51.9
%
Price-earnings ratio
14.5
13.8
10.6
Capital ratios
2
Common Equity Tier 1 (CET1) Capital ratio
14.5
%
14.7
%
13.1
%
Tier 1 Capital ratio
16.3
16.4
14.7
Total Capital ratio
18.1
18.4
17.0
Leverage ratio
4.5
4.6
4.2
Total Loss Absorbing Capacity (TLAC) ratio
31.1
31.8
29.5
TLAC Leverage ratio
8.6
8.9
8.5
1
The Toronto-Dominion Bank (“TD” or the
“Bank”) prepares its Interim Consolidated Financial Statements in accordance with IFRS,
the current GAAP, and refers
to results prepared in
accordance with IFRS as the “reported” results. The Bank also utilizes non-GAAP financial measures
such as “adjusted” results and non-GAAP ratios to assess each of its businesses
and to measure overall Bank performance. To
arrive at adjusted results, the Bank adjusts reported results for “items of note”. Refer to “Significant
Events”, “How We Performed” or “How
Our Businesses Performed” sections
of this document for further explanation, a list of the items of note, and a reconciliation of
adjusted to reported results. Non-GAAP financial measures
and ratios used in this document are not defined terms under IFRS and, therefore, may not be comparable to similar
terms used by other issuers.
2
These measures have been included in this document in accordance with the Office of the Superintendent
of Financial Institutions Canada’s (OSFI’s) Capital Adequacy
Requirements
(CAR), Leverage Requirements (LR), and Total
Loss Absorbing Capacity (TLAC) guidelines.
Refer to the “Capital Position” section of this document for further details.
3
For additional information about these metrics, refer to the Glossary of this document.
4
Efficiency ratio – adjusted, net of ISE is calculated by dividing adjusted non-interest expenses by adjusted
total revenue, net of ISE. Adjusted total revenue, net of ISE –
Q1 2026: $15,007 million, Q4 2025: $14,426 million, Q1 2025: $13,523 million.
5
Toronto Stock Exchange closing market
price.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 6
7
8
SIGNIFICANT EVENTS
Restructuring Charges
The Bank continued to undertake certain
measures in the first quarter of 2026 to reduce
its cost base and achieve greater efficiency. In connection with this
program, the Bank incurred $200 million
pre-tax of restructuring charges for the three
months ended January 31, 2026, which primarily
related to employee
severance and other personnel-related
costs, real estate optimization, and asset impairment
and other rationalization, including certain
business wind-downs. The
Bank is above its previously disclosed guidance
that its restructuring charges in the first
quarter of 2026 would be approximately
$125 million pre-tax, primarily due
to additional workforce optimization opportunities.
The restructuring program concluded on
January 31, 2026, with total program charges
of $886 million pre-tax. The Bank expects
the program to generate total
pre-tax fully realized annual program savings
of approximately $775 million, including
savings from an approximate 3% workforce
reduction
.
UPDATE ON THE
REMEDIATION
OF THE U.S. BANK SECRECY ACT/ANTI-MONEY LAUNDERING
PROGRAM AND
ENTERPRISE AML PROGRAM
As previously disclosed, on October 10, 2024,
the Bank announced that, following active
cooperation and engagement with authorities and
regulators, it reached a
resolution (the “Global Resolution”) of
previously disclosed investigations related
to its U.S. BSA/AML program. The Bank
and certain of its U.S. subsidiaries
consented to orders with the Office of the Comptroller
of the Currency (“OCC”), the Federal
Reserve Board (“FRB”), and the Financial Crimes
Enforcement
Network (“FinCEN”) and entered into plea agreements
with the Department of Justice (“DOJ”), Criminal
Division, Money Laundering and Asset Recovery
Section
and the United States Attorney’s Office for the District
of New Jersey. The full terms of the consent orders and plea
agreements are available on the Bank’s issuer
profile on SEDAR+ at www.sedarplus.com.
The Bank is focused on meeting the terms
of the consent orders and plea agreements,
including meeting the requirements to remediate
the Bank’s U.S. BSA/AML
program. In addition, the Bank is also undertaking
remediation of the Bank’s enterprise-wide AML/Anti-Terrorist Financing and Sanctions
Programs (“Enterprise
AML Program”).
For additional information on the risks associated
with the remediation of the Bank’s U.S. BSA/AML
program and the Bank’s Enterprise AML Program,
see the
“Risk Factors That May Affect Future Results –
Remediation of the Bank’s U.S. BSA/AML Program
and Enterprise AML Program” section
of the 2025 MD&A.
Update on the Remediation of the U.S.
AML Program
The Bank remains focused on remediating
its U.S. BSA/AML program to meet the requirements
of the Global Resolution. The Bank continues
to work on its
management remediation actions (the term
“management remediation actions” is
not a regulatory definition and is considered by
the Bank to consist of the root
cause assessments, data preparation, design,
documentation, frameworks, policies, standards,
training, processes, systems, testing and implementation
of
controls, as well as the hiring of resources)
with significant work and important milestones
remaining in calendar 2026 and calendar 2027
including the Suspicious
Activity Report lookback per the OCC consent
order which management expects
to complete in calendar 2027. For fiscal 2026,
the Bank continues to expect U.S.
BSA/AML remediation and related governance
and control investments of approximately
US$500 million pre-tax.
All management remediation actions
will be
subject to demonstrated sustainability and
validation by the Bank’s internal audit function
(with such activities currently planned
for calendar 2026 and calendar
2027), as well as the review by the appointed
monitor, and, ultimately, the review and approval of the Bank’s U.S. banking regulators
and the DOJ. Following such
independent reviews, testing, and validation,
there could be additional management remediation
actions that would take place after calendar
2027 in which case
the overall remediation timeline may be extended.
In addition, as the Bank undertakes the lookback
reviews, the Bank may be required to further expand
the
scope of the review, either in terms of the subjects being
addressed and/or the time period reviewed.
The following graph illustrates the Bank’s expected
remediation plan and progress on a calendar
year basis, based on its work to date:
The Bank’s remediation timeline is based on
the Bank’s current plans, as well as assumptions
related to the duration of planning activities,
including the
completion of external benchmarking and
lookback reviews. The Bank’s ability to
meet its planned remediation milestones assumes
that the Bank will be able to
successfully execute against its U.S. BSA/AML
remediation program plan, which is
subject to inherent risks and uncertainties including
the Bank’s ability to attract
and retain key employees, the ability of
third parties to deliver on their contractual obligations,
the successful development and implementation
of required
technology solutions, and data availability
to complete the required lookback reviews.
Furthermore, the execution of the U.S. BSA/AML
remediation plan, including
these planned milestones, will not be entirely
within the Bank’s control because of various factors
such as (i) the requirement to obtain regulatory
approval or non-
objection before proceeding with various
steps, and (ii) the requirement for the various
deliverables to be acceptable to the regulators
and/or the monitor. As of the
date hereof, the Bank believes that it and its applicable
U.S. subsidiaries have taken such actions
as are required of them to date under the
terms of the consent
orders and plea agreements and is not aware
of them being in breach of the same. For
information about the Bank’s AML governance
framework, see the
“Managing Risk” section of this document.
While substantial work remains, the
Bank is making progress on remediating
and strengthening its U.S. BSA/AML program
as previously disclosed including
continued improvements through:
7
The Bank’s expectations regarding the restructuring program are subject to inherent uncertainties and
are based on the Bank’s assumptions regarding certain factors, including rate of
natural attrition, talent re-deployment opportunities, years-of-service, execution timing of actions, and foreign exchange
translation impacts. Refer to the “Risk Factors That May Affect
Future Results” section of this document for additional information about risks and uncertainties that may impact
the Bank’s estimates.
8
The total amount expected to be spent on remediation and governance and control investments is subject to inherent uncertainties
and may vary based on the scope of work in the U.S.
BSA/AML remediation plan which could change as a result of additional findings that are identified as work progresses
as well as the Bank’s ability to successfully execute against the
U.S. BSA/AML remediation program in accordance with the U.S. Banking segment’s fiscal 2026 and
medium-term plan
.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 7
1)
enhanced customer screening procedures
which incorporate new automated system
capabilities for customer onboarding;
2)
the adoption of a more data-driven financial
crime risk assessment methodology and process
which provides a more accurate assessment of
the
Bank’s financial crimes risks; and
3)
the deployment of the first phase of the
U.S. Bank’s new centralized Know Your Customer (KYC) platform to
certain business users, enabling the
collection and maintenance of customer information
in a single profile resulting in better insights
about the Bank’s customers.
Going forward, the Bank’s focus will be on
continuing to remediate and strengthen its
U.S. BSA/AML program, including:
1)
further deployments of the new KYC
platform;
2)
further deployments of machine learning
and specialized AI;
3)
continued focus on lookback reviews as required
under the OCC and FinCEN consent orders;
4)
continued data enhancements with the deployment
of dedicated Financial Crimes Risk Management
(FCRM) data environments which will create
a
single source of truth in support of advanced
detection capabilities;
5)
continue enhancing its financial crime risk
assessment methodologies and processes;
and
6)
continued training and development of colleagues.
Strengthening of the Bank’s Enterprise AML Program
The Bank continues to undertake remediation
of the Enterprise AML Program, including
a range of management remediation and
enhancement actions (the term
“management remediation and enhancement
actions” is not a regulatory definition and
is considered by the Bank to consist
of root cause assessments, data
preparation, design, documentation, frameworks,
policies, standards, training, processes,
systems, testing, and execution of controls,
as well as the hiring of
resources). While the Bank has made progress
on this remediation work, it is a multi-year
endeavour and the remediation work remains
ongoing. The timing of
completion of the remediation work will not
be entirely within the Bank’s control, and is subject
to regulatory feedback, internal review, challenge and validation.
As
previously disclosed, following the end of the
first quarter of fiscal 2025, the Financial Transactions
and Reports Analysis Centre of Canada (FINTRAC)
commenced a review of certain remediation
steps that the Bank has taken to date
to address the FINTRAC violations.
This review is ongoing, and subject to the
outcome, may result in additional regulatory
actions.
The remediation and enhancement of the Enterprise
AML Program is exposed to similar
risks as noted in respect of the remediation
of the Bank’s U.S. BSA/AML
Program (see also “Remediation of the
U.S. BSA/AML Program” above). In particular, as the Bank
continues its remediation and improvement activities
of the
Enterprise AML Program, it expects an increase
in identification of reportable transactions
and/or events, which will add to the operational
backlog in the Bank’s
FCRM investigations processing that the
Bank currently faces, but is working
towards remediating, across the Bank. In
addition, on an ongoing basis, the Bank will
continue to review and assess whether issues
identified in one jurisdiction have an impact
in other jurisdictions. Furthermore, the
Bank’s regulators or law
enforcement agencies may identify other issues
with the Bank’s Enterprise AML Program, which
may result in additional regulatory actions.
These issues identified
through the Bank’s own review or by the Bank’s regulators
or law enforcement agencies may
broaden the scope of the remediation and improvements
required for
the Enterprise AML Program.
While substantial work remains, the
Bank is making progress on remediating
and strengthening the Enterprise AML
Program as previously disclosed, including:
1) continued advancement on clearing operational
backlogs;
2) completed enhancements to transaction
monitoring capabilities, including updates to the
customer risk rating methodology; and
3) conducting policy transformation activities
to strengthen alignment across FCRM
globally.
Going forward, the Bank’s focus will be on
continuing to remediate and strengthen its
Enterprise AML Program,
including:
1)
continued enhancement and adoption of
the new centralized case management
tool, with the goal of strengthening oversight
and investigations of
identified FCRM risks;
2)
ongoing advancements in transaction monitoring
capabilities;
and
3)
continued investment in supporting advanced
analytics, machine learning, and AI opportunities
within FCRM.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 8
HOW WE PERFORMED
CORPORATE OVERVIEW
The Toronto-Dominion Bank and its subsidiaries are collectively known as
TD Bank Group (“TD” or the “Bank”). TD is
the sixth largest bank in North America by
assets and serves 28.1 million clients in four
key businesses operating in a number of
locations in financial centres around the
globe: Canadian Personal and
Commercial Banking, including TD Canada
Trust and TD Auto Finance Canada; U.S. Banking,
including TD Auto Finance U.S., and TD
Wealth (U.S.); Wealth
Management and Insurance, including
TD Wealth (Canada), TD Direct Investing, and
TD Insurance; and Wholesale Banking, including
TD Securities and TD
Cowen. TD also ranks among North America’s leading
digital banks,
with more than 13 million active mobile users
in Canada and the U.S. TD had $2.1 trillion
in
assets on January 31, 2026. The Toronto-Dominion Bank trades under the symbol
“TD” on the Toronto Stock Exchange and New York Stock Exchange.
HOW THE BANK REPORTS
The Bank prepares its Interim Consolidated
Financial Statements in accordance
with IFRS, the current GAAP, and refers to results prepared in accordance with
IFRS as “reported”
results.
Non-GAAP and Other Financial Measures
In addition to reported results, the Bank also
presents certain financial measures, including
non-GAAP financial measures that are historical,
non-GAAP ratios,
supplementary financial measures and capital
management measures, to assess its results.
Non-GAAP financial measures, such as “adjusted”
results, are utilized
to assess the Bank’s businesses and to measure
the Bank’s overall performance.
To
arrive at adjusted results, the Bank adjusts
for “items of note” from reported
results. Items of note are items which management
does not believe are indicative of underlying
business performance and are disclosed
in Table 3. Non-GAAP
ratios include a non-GAAP financial measure
as one or more of its components. Examples
of non-GAAP ratios include adjusted net
interest margin, adjusted basic
and diluted earnings per share (EPS), adjusted
dividend payout ratio, adjusted efficiency ratio,
net of ISE, and adjusted effective income tax rate.
The Bank
believes that non-GAAP financial measures and
non-GAAP ratios provide the reader with
a better understanding of how management
views the Bank’s
performance. Non-GAAP financial measures
and non-GAAP ratios used in this document
are not defined terms under IFRS and,
therefore, may not be
comparable to similar terms used by other issuers.
Supplementary financial measures depict
the Bank’s financial performance and position, and
capital
management measures depict the Bank’s capital
position, and both are explained in this document
where they first appear.
Investment in The Charles Schwab Corporation
(“Schwab”) and Insured Deposit Account
(IDA) Agreement
On February 12, 2025, the Bank sold its entire
remaining equity investment in Schwab
through a registered offering and share repurchase
by Schwab. The Bank
discontinued recording its share of earnings
available to common shareholders from
its investment in Schwab following
the sale.
Prior to the sale, the Bank accounted
for its investment in Schwab using the equity
method. The U.S. Banking segment reflected the Bank’s
share of net income
from its investment in Schwab. The Corporate
segment net income (loss) included
amounts for amortization of acquired intangibles,
the acquisition and integration
charges related to the Schwab transaction,
and the Bank’s share of restructuring and other
charges incurred by Schwab. The Bank’s share of
Schwab’s earnings
available to common shareholders was
reported with a one-month lag. For further
details, refer to Note 12 of the Bank’s 2025
Annual Consolidated Financial
Statements.
Subsequent to the sale of the Bank’s entire remaining
equity investment in Schwab, the Bank
continues to have a business relationship
with Schwab through
the insured deposit account agreement (“Schwab
IDA Agreement”).
On May 4, 2023, the Bank and Schwab entered
into an amended Schwab IDA Agreement,
with an initial expiration of July 1, 2034. Pursuant
to the Schwab IDA
Agreement, the Bank makes sweep deposit
accounts available to clients of Schwab.
Schwab designates a portion of the deposits
with the Bank as fixed-rate
obligation amounts. Remaining deposits are designated
as floating-rate obligations. The IDA deposit
floor is set at US$60 billion.
Refer to Note 26 of the Bank’s 2025 Annual
Consolidated Financial Statements for further
details on the Schwab IDA Agreement.
The following table provides the operating results
on a reported basis for the Bank.
TABLE 2: OPERATING RESULTS – Reported
(millions of Canadian dollars)
For the three months ended
January 31
October 31
January 31
2026
2025
2025
Net interest income
$
8,789
$
8,545
$
7,866
Non-interest income
7,796
6,949
6,183
Total revenue
16,585
15,494
14,049
Provision for (recovery of) credit losses
1,039
982
1,212
Insurance service expenses
1,622
1,602
1,507
Non-interest expenses
8,753
8,808
8,070
Income before income taxes and share
of net income from
investment in Schwab
5,171
4,102
3,260
Provision for (recovery of) income taxes
1,128
822
698
Share of net income from investment in
Schwab
–
–
231
Net income – reported
4,043
3,280
2,793
Preferred dividends and distributions on other
equity instruments
101
191
86
Net income available to common shareholders
$
3,942
$
3,089
$
2,707
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 9
The following table provides a reconciliation between
the Bank’s adjusted and reported results.
For further details refer to the “Significant
Events”, “How We
Performed”, or “How Our Businesses Performed”
sections.
TABLE 3: NON-GAAP FINANCIAL MEASURES – Reconciliation
of Adjusted to Reported Net Income
(millions of Canadian dollars)
For the three months ended
January 31
October 31
January 31
2026
2025
2025
Operating results – adjusted
Net interest income
1
$
8,833
$
8,594
$
7,920
Non-interest income
2
7,796
7,434
7,110
Total revenue
16,629
16,028
15,030
Provision for (recovery of) credit losses
1,039
982
1,212
Insurance service expenses
1,622
1,602
1,507
Non-interest expenses
3
8,563
8,540
7,983
Income before income taxes and share of net income from
investment in Schwab
5,405
4,904
4,328
Provision for (recovery of) income taxes
1,189
999
962
Share of net income from investment in Schwab
4
–
–
257
Net income – adjusted
4,216
3,905
3,623
Preferred dividends and distributions on other equity instruments
101
191
86
Net income available to common shareholders –
adjusted
4,115
3,714
3,537
Pre-tax adjustments for items of note
Amortization of acquired intangibles
5
(34)
(34)
(61)
Restructuring charges
3
(200)
(190)
–
Acquisition and integration-related charges
3
–
(44)
(52)
Impact from the terminated FHN acquisition-related capital
hedging strategy
1
(44)
(49)
(54)
Balance sheet restructuring
2
–
(485)
(927)
FDIC special assessment
3
44
–
–
Less: Impact of income taxes
Amortization of acquired intangibles
(8)
(8)
(9)
Restructuring charges
(52)
(50)
–
Acquisition and integration-related charges
–
(9)
(11)
Impact from the terminated FHN acquisition-related capital
hedging strategy
(12)
(13)
(13)
Balance sheet restructuring
–
(97)
(231)
FDIC special assessment
11
–
–
Total adjustments for items
of note
(173)
(625)
(830)
Net income available to common shareholders – reported
$
3,942
$
3,089
$
2,707
1
After the termination of the merger agreement between the Bank and FHN on May 4, 2023, the residual
impact of the strategy is reversed through net interest income (NII) – Q1 2026: ($44)
million, Q4 2025: ($49) million,
Q1 2025: ($54) million, reported in the Corporate segment.
2
Adjusted non-interest income excludes the following item of note:
i.
Balance sheet restructuring – Q4 2025: $383 million, Q1 2025: $927 million in respect of U.S. Banking
activities, reported in the U.S. Banking segment, and Q4 2025: $102 million in respect of other
activities,
reported in the Corporate segment.
3
Adjusted non-interest expenses exclude the following items of note:
i.
Amortization of acquired intangibles – Q1 2026: $34 million, Q4 2025: $34 million, Q1 2025: $35 million, reported
in the Corporate segment;
ii.
Restructuring charges – Q1 2026: $200 million, Q4 2025: $190 million, reported in the Corporate segment;
iii.
Acquisition and integration-related charges – Q4 2025: $44 million, Q1 2025: $52 million, reported in
the Wholesale Banking segment; and
iv.
FDIC special assessment – Q1 2026: ($44) million, reported in the U.S. Banking segment.
4
Adjusted share of net income from investment in Schwab excludes the following item of note on
an after-tax basis. The earnings impact of this item was reported in the Corporate segment:
i.
Amortization of Schwab-related acquired intangibles – Q1 2025: $26 million.
5
Amortization of acquired intangibles relates to intangibles acquired as a result of asset acquisitions and
business combinations, including the after-tax amount for amortization of acquired intangibles relating
to the share of
net income from investment in Schwab, reported in the Corporate segment. Refer to
footnotes 3 and 4 for amounts.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 10
TABLE 4: RECONCILIATION OF REPORTED TO ADJUSTED EARNINGS PER SHARE
1
(Canadian dollars)
For the three months ended
January 31
October 31
January 31
2026
2025
2025
Basic earnings per share – reported
$
2.35
$
1.82
$
1.55
Adjustments for items of note
0.10
0.37
0.47
Basic earnings per share – adjusted
$
2.45
$
2.19
$
2.02
Diluted earnings per share – reported
$
2.34
$
1.82
$
1.55
Adjustments for items of note
0.10
0.36
0.47
Diluted earnings per share – adjusted
$
2.44
$
2.18
$
2.02
1
EPS is computed by dividing net income available to common shareholders by the weighted-average number of
shares outstanding during the period. Numbers may not add due to
rounding.
TABLE 5: AMORTIZATION OF INTANGIBLES, NET OF INCOME TAXES
(millions of Canadian dollars)
For the three months ended
January 31
October 31
January 31
2026
2025
2025
Schwab
1
$
–
$
–
$
26
Wholesale Banking related intangibles
20
20
21
Other
6
6
5
Included as items of note
26
26
52
Software and asset servicing rights
135
124
119
Amortization of intangibles, net of income
taxes
$
161
$
150
$
171
1
Included in share of net income from investment in Schwab.
Return on Common Equity
The consolidated Bank ROE is calculated
as reported net income available to common
shareholders as a percentage of average
common equity. The
consolidated Bank adjusted ROE is calculated
as adjusted net income available to
common shareholders as a percentage of average
common equity. Adjusted
ROE is a non-GAAP financial ratio and
can be utilized in assessing the Bank’s use of equity.
ROE for the business segments is calculated
as the segment net income as a percentage
of average allocated capital. The Bank’s
methodology for allocating
capital to its business segments is largely aligned
with the common equity capital requirements
under Basel III. Capital allocated to
the business segments was
based on 11.5% of CET1 Capital for the three months ended
January 31, 2026.
TABLE 6: RETURN ON COMMON EQUITY
(millions of Canadian dollars, except
as noted)
For the three months ended
January 31
October 31
January 31
2026
2025
2025
Average common equity
$
115,250
$
114,939
$
106,133
Net income available to common shareholders
– reported
3,942
3,089
2,707
Items of note, net of income taxes
173
625
830
Net income available to common shareholders
– adjusted
$
4,115
$
3,714
$
3,537
Return on common equity – reported
13.6
%
10.7
%
10.1
%
Return on common equity – adjusted
14.2
12.8
13.2
Return on Tangible Common Equity
Tangible common equity (TCE) is calculated as common shareholders’ equity
less goodwill, imputed goodwill and intangibles
on the investments in Schwab and
other acquired intangible assets, net of related
deferred tax liabilities. ROTCE is calculated
as reported net income available to common
shareholders after
adjusting for the after-tax amortization of
acquired intangibles, which are treated as an
item of note, as a percentage of average
TCE. Adjusted ROTCE is
calculated using reported net income available
to common shareholders, adjusted for all
items of note, as a percentage of average
TCE. TCE, ROTCE, and
adjusted ROTCE can be utilized in assessing
the Bank’s use of equity. TCE is a non-GAAP financial measure,
and ROTCE and adjusted ROTCE are
non-GAAP
ratios.
TABLE 7: RETURN ON TANGIBLE COMMON EQUITY
(millions of Canadian dollars, except
as noted)
For the three months ended
January 31
October 31
January 31
2026
2025
2025
Average common equity
$
115,250
$
114,939
$
106,133
Average goodwill
18,751
18,814
19,205
Average imputed goodwill and intangibles on
investments in Schwab
–
–
5,116
Average other acquired intangibles
1
339
374
482
Average related deferred tax liabilities
(246)
(230)
(237)
Average tangible common equity
96,405
95,981
81,567
Net income available to common
shareholders – reported
3,942
3,089
2,707
Amortization of acquired intangibles, net of income
taxes
26
26
52
Net income available to common shareholders
adjusted for amortization of acquired intangibles,
net of income taxes
3,968
3,115
2,759
Other items of note, net of income taxes
147
599
778
Net income available to common shareholders
– adjusted
$
4,115
$
3,714
$
3,537
Return on tangible common equity
16.3
%
12.9
%
13.4
%
Return on tangible common equity – adjusted
16.9
15.4
17.2
1
Excludes intangibles relating to software and asset servicing rights.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 11
9
IMPACT OF FOREIGN EXCHANGE RATE ON U.S. BANKING SEGMENT TRANSLATED EARNINGS
The following table reflects the estimated impact
of foreign currency translation on key
U.S. Banking segment income statement items.
The impact is calculated as
the difference in translated earnings using the average
U.S. to Canadian dollars exchange rates in the
periods noted.
TABLE 8: IMPACT OF FOREIGN EXCHANGE RATE ON U.S. BANKING TRANSLATED EARNINGS
(millions of Canadian dollars, except
as noted)
For the three months ended
January 31, 2026 vs.
January 31, 2025
Increase (Decrease)
U.S. Banking
Total revenue – reported
$
(95)
Total revenue – adjusted
1
(95)
Non-interest expenses – reported
(58)
Non-interest expenses – adjusted
1
(59)
U.S. Banking net income excluding Schwab
– reported, after tax
(24)
U.S. Banking net income excluding Schwab
– adjusted, after tax
1
(23)
U.S. Banking net income – reported, after tax
(24)
U.S. Banking net income – adjusted, after
tax
1
(23)
Earnings (loss) per share
(Canadian dollars)
Basic – reported
$
(0.01)
Basic – adjusted
1
(0.01)
Diluted – reported
(0.01)
Diluted – adjusted
1
(0.01)
Average foreign exchange rate (equivalent of CAD $1.00)
For the three months ended
January 31
January 31
2026
2025
U.S. dollar
$
0.721
$
0.704
1
For additional information about the Bank’s use of non-GAAP financial measures, refer to “Non-GAAP
and Other Financial Measures” in the “How We Performed” section of this
document.
FINANCIAL RESULTS
OVERVIEW
Performance Summary
Outlined below is an overview of the Bank’s performance
for the first quarter of 2026. Shareholder
performance indicators help guide and benchmark
the Bank’s
accomplishments. For the purposes
of this analysis, the Bank utilizes adjusted earnings,
which excludes items of note from the reported
results that are prepared
in accordance with IFRS. Reported and adjusted
results and items of note are explained in “Non-GAAP
and Other Financial Measures” in the “How
We Performed”
section of this document.
●
Adjusted diluted EPS for the three months ended
January 31, 2026, increased 21% from
the same period last year.
●
Adjusted ROTCE for the three months ended
January 31, 2026, was 16.9%.
●
For the twelve months ended January 31, 2026,
the total shareholder return was 60.0%
compared to the Canadian peer
average of 38.4%.
Net Income
Quarterly comparison – Q1 2026 vs. Q1 2025
Reported net income for the quarter was $4,043
million, an increase of $1,250 million, or 45%,
compared with the first quarter last year, primarily reflecting
higher
revenues in the current quarter and the impact
of U.S. balance sheet restructuring activities
in the first quarter last year, partially offset by higher non-interest
expenses and restructuring charges. On an
adjusted basis, net income for the quarter
was $4,216 million, an increase of $593 million,
or 16%, compared with the
first quarter last year.
By segment, the increase in reported net income
reflects increases in U.S. Banking of $698
million, in Wholesale Banking of $262
million, in Canadian Personal
and Commercial Banking of $213 million,
and in Wealth Management and Insurance
of $77 million.
Quarterly comparison – Q1 2026 vs. Q4 2025
Reported net income for the quarter increased
$763 million, or 23%, compared with the prior
quarter, primarily reflecting higher revenues in the
current quarter and
the impact of U.S. balance sheet restructuring
activities in the prior quarter. Adjusted net income for the
quarter increased $311 million, or 8%, compared with the
prior quarter.
By segment, the increase in reported net income
reflects increases in U.S. Banking of $321
million, in Canadian Personal and Commercial
Banking of
$179 million, in the Corporate segment
of $138 million, in Wholesale Banking of
$67 million, and in Wealth Management and
Insurance of $58 million.
Net Interest Income
Quarterly comparison – Q1 2026 vs. Q1 2025
Reported net interest income for the quarter
was $8,789 million, an increase of $923
million, or 12%, compared with the first quarter
last year, primarily reflecting
volume growth and higher loan margins in Canadian
Personal and Commercial Banking, higher
revenue from treasury and balance sheet
activities, and higher
product margins and the impact of balance
sheet restructuring activities in U.S. Banking.
On an adjusted basis, net interest income
was $8,833 million, an increase
of $913 million, or 12%.
By segment, the increase in reported net interest
income reflects increases in the Corporate
segment of $363 million, in Canadian Personal
and Commercial
Banking of $259 million, in U.S. Banking of
$232 million, in Wealth Management and
Insurance of $37 million, and in Wholesale
Banking of $32 million.
9
Canadian peers include Bank of Montreal, Canadian Imperial Bank of Commerce, Royal Bank of Canada, and
The Bank of Nova Scotia.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 12
10
Quarterly comparison – Q1 2026 vs. Q4 2025
Reported net interest income for the quarter
increased $244 million, or 3%, compared with
the prior quarter, primarily reflecting volume
growth and higher loan
margins in Canadian Personal and Commercial
Banking, an adjustment for client deposit rate
in the prior quarter and higher loan margins
in the current quarter in
U.S. Banking, and the impact of foreign exchange
translation. On an adjusted basis, net
interest income increased $239 million, or
3%.
By segment, the increase in reported net interest
income reflects increases in U.S. Banking
of $131 million, in Canadian Personal and
Commercial Banking of
$90 million, in Wealth Management and Insurance
of $17 million, and in the Corporate segment
of $15 million, partially offset by a decrease
in Wholesale Banking
of $9 million.
Non-Interest Income
Quarterly comparison – Q1 2026 vs. Q1 2025
Reported non-interest income for the quarter
was $7,796 million, an increase of $1,613
million, or 26%, compared with the first quarter last
year, primarily
reflecting the impact of U.S. balance
sheet restructuring activities in the first quarter
last year, higher trading-related revenue, lending revenue,
advisory fees, and
underwriting fees in Wholesale Banking, and
higher insurance earned premiums, fee-based
revenues
from assets growth, and transaction revenue
in Wealth
Management and Insurance. On an adjusted
basis, non-interest income was $7,796
million, an increase of $686 million, or 10%.
By segment, the increase in reported non-interest
income reflects increases in U.S. Banking
of $907 million, in Wholesale Banking of
$438 million, in Wealth
Management and Insurance of $271 million, and
in Canadian Personal and Commercial Banking
of $13 million, partially offset by a decrease in
the Corporate
segment of $16 million.
Quarterly comparison – Q1 2026 vs. Q4 2025
Reported non-interest income for the quarter increased
$847 million, or 12%, compared with
the prior quarter, primarily reflecting the impact
of U.S. balance sheet
restructuring activities in the prior quarter, higher
trading-related revenue in Wholesale Banking,
and strong underlying insurance performance
and higher fee-
based revenues in Wealth Management and
Insurance. On an adjusted basis, non-interest
income increased $362 million, or 5%.
By segment, the increase in non-interest income
reflects increases in U.S. Banking of $356
million, in Wholesale Banking of $279 million,
in Wealth
Management and Insurance of $101 million, in
the Corporate segment of $85 million, and in
Canadian Personal and Commercial Banking
of $26 million.
Provision for Credit Losses
Quarterly comparison – Q1 2026 vs. Q1 2025
PCL for the quarter was $1,039 million, a decrease
of $173 million compared with the first
quarter last year. PCL – impaired was $1,164
million, a decrease of
$52 million, or 4%, largely reflecting lower provisions
in Canadian and U.S. commercial and
U.S. consumer lending portfolios, partially
offset by higher provisions
in the Wholesale and Canadian consumer lending
portfolios. PCL – performing was a recovery
of $125
million, compared with a recovery of $4
million in the first
quarter last year. The performing recovery this quarter reflects
migration from performing to impaired in the
Wholesale and U.S. commercial lending portfolios,
and
improvement to the Canadian and U.S.
macroeconomic forecasts. Total PCL for the quarter as an annualized percentage
of credit volume was 0.43%.
By segment, PCL was lower by $156
million in U.S. Banking,
by $85 million in Canadian Personal and
Commercial Banking and by $32 million in
Corporate
segment, and higher by $100 million in Wholesale
Banking.
Quarterly comparison – Q1 2026 vs. Q4 2025
PCL for the quarter was $1,039 million, an increase
of $57 million compared with the prior
quarter. PCL – impaired was $1,164
million, an increase of $221 million,
or 23%, largely reflecting credit migration in
the Wholesale and U.S. commercial lending portfolios
related to a small number of impairments
across various
industries, partially offset by lower provisions in the
Canadian commercial lending portfolio.
PCL – performing was a recovery of $125
million, compared with a
build of $39 million in the prior quarter. The performing recovery
this quarter reflects migration from performing
to impaired in the Wholesale and U.S. commercial
lending portfolios, and improvement to the
Canadian and U.S. macroeconomic forecasts.
Total PCL for the quarter as an annualized percentage of credit volume
was 0.43%.
By segment, PCL was higher by $148
million in Wholesale Banking and by $19
million in Corporate segment,
and lower by $101 million in Canadian Personal
and Commercial Banking and by $9 million
in U.S. Banking.
Looking forward, while results may vary by
quarter, and are subject to changes to economic conditions,
we continue to expect fiscal 2026 PCLs to fall
within a
range of 40 to 50 basis points
.
TABLE 9: PROVISION FOR CREDIT LOSSES
1
(millions of Canadian dollars)
For the three months ended
January 31
October 31
January 31
2026
2025
2025
Provision for (recovery of) credit losses
– Stage 3 (impaired)
Canadian Personal and Commercial
Banking
$
424
$
447
$
459
U.S. Banking
394
331
529
Wholesale Banking
216
28
33
Corporate
2
130
137
195
Total provision for (recovery of) credit losses – Stage 3
1,164
943
1,216
Provision for (recovery of) credit losses
– Stage 1
and Stage 2 (performing)
Canadian Personal and Commercial
Banking
12
90
62
U.S. Banking
(99)
(27)
(78)
Wholesale Banking
(44)
(4)
39
Corporate
2
6
(20)
(27)
Total provision for (recovery of) credit losses – Stage 1
and Stage 2
(125)
39
(4)
Total provision for (recovery of) credit losses
$
1,039
$
982
$
1,212
1
Includes PCL for off-balance sheet instruments.
2
Includes PCL on the retailer program partners’ share of the U.S. strategic cards portfolio.
10
The Bank’s estimated PCL range is based on forward-looking assumptions that have inherent risks and
uncertainties. Results may vary depending on actual economic or credit
conditions and performance, such as the level of unemployment, interest rates, economic growth or contraction, and
borrower or industry specific credit factors and conditions, inclusive
of policy and trade uncertainty.
The Bank’s PCL estimate is subject to risks and uncertainties including those set out in the
“Risk Factors and Management” section of this document.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 13
11
Insurance Service Expenses
Quarterly comparison – Q1 2026 vs. Q1 2025
Insurance service expenses for the quarter
were $1,622 million, an increase of $115 million, or 8%, compared
with the first quarter last year, primarily reflecting
increased claims severity.
Quarterly comparison – Q1 2026 vs. Q4 2025
Insurance service expenses were relatively
flat compared with the prior quarter.
Non-Interest Expenses and Efficiency
Ratio
Quarterly comparison – Q1 2026 vs. Q1 2025
Reported non-interest expenses were $8,753
million, increased $683 million, or 8%,
compared with the first quarter last year, primarily reflecting
higher
governance and control investments, including
costs for U.S. BSA/AML remediation, restructuring
charges, and higher spend supporting business
growth
initiatives, including employee-related expenses.
On an adjusted basis, non-interest expenses
were $8,563 million, an increase of $580
million, or 7%. The Bank
continues to expect fiscal 2026 adjusted expense
growth, assuming fiscal 2025 levels of
variable compensation, foreign exchange
translation, and U.S. strategic
cards portfolio impact, to be at the previously
communicated 3% to 4% range, reflecting
investments supporting business growth and
investments in governance
and control, net of expected productivity and
restructuring savings
.
By segment, the increase in reported non-interest
expenses reflects increases in the
Corporate segment of $421 million, in
U.S. Banking of $88 million, in
Wealth Management and Insurance of $85 million,
in Canadian Personal and Commercial
Banking of $61 million, and in Wholesale
Banking of $28 million.
The Bank’s reported efficiency ratio was 52.8%, compared
to 57.4% in the first quarter last year. The Bank’s adjusted efficiency ratio,
net of ISE was 57.1%,
compared with 59.0%
in the first quarter last year.
Quarterly comparison – Q1 2026 vs. Q4 2025
Reported non-interest expenses decreased
$55 million, or 1%, compared with the prior
quarter, primarily reflecting the expense recovery of the
FDIC special
assessment charge. Adjusted non-interest
expenses increased $23 million, or relatively
flat compared with the prior quarter.
By segment, the decrease in reported non-interest
expenses reflect decreases in U.S. Banking
of $32 million, in Canadian Personal and
Commercial Banking of
$31 million, and in the Corporate segment of $15
million, partially offset by increases in Wealth
Management and Insurance of $19 million and in
Wholesale
Banking of $4 million.
The Bank’s reported efficiency ratio was 52.8%, compared
with 56.8% in the prior quarter. The Bank’s adjusted efficiency ratio, net of
ISE was 57.1%,
compared with 59.2% in the prior quarter.
Income Taxes
The Bank’s effective income tax rate on a reported
basis was 21.8% for the current quarter, compared with 21.4%
in the first quarter last year and 20.0%
in the
prior quarter. The year-over-year increase primarily reflects
the tax impact of higher reported pre-tax income,
partially offset by higher U.S. tax credits and changes
in earnings mix. The quarter-over-quarter increase
primarily reflects the tax impact of higher
reported pre-tax income in the current quarter
and discrete tax
adjustments in the prior quarter, partially offset by higher U.S.
tax credits and changes in earnings mix.
To allow for an after-tax calculation of adjusted income, the adjusted provision
for income taxes is calculated by adjusting
the taxes for each item of note using
the statutory income tax rate of the applicable
legal entity. The adjusted effective income tax rate is calculated
as the adjusted provision for income taxes as
a
percentage of adjusted net income before
taxes. The Bank’s adjusted effective income tax rate
was 22.0% for the current quarter, compared with 22.2% in
the first
quarter last year and 20.4% in the prior quarter. The year-over-year
rate is stable, reflecting the impact of
higher adjusted pre-tax income, partially
offset by higher
U.S. tax credits and changes in earnings
mix. The quarter-over-quarter increase primarily
reflects the impact of higher adjusted pre-tax
income in the current
quarter and discrete tax adjustments in the
prior quarter, partially offset by higher U.S. tax credits and changes in
earnings mix.
TABLE 10: INCOME TAXES – Reconciliation of Reported to Adjusted Provision for
Income Taxes
(millions of Canadian dollars, except
as noted)
For the three months ended
January 31
October 31
January 31
2026
2025
2025
Income taxes at Canadian statutory income
tax rate
$
1,438
27.8
%
$
1,140
27.8
%
$
906
27.8
%
Increase (decrease) resulting from:
Rate differentials on international operations
1
(276)
(5.3)
(292)
(7.1)
(199)
(6.1)
Other
(34)
(0.7)
(26)
(0.7)
(9)
(0.3)
Provision for income taxes and effective
income tax rate – reported
$
1,128
21.8
%
$
822
20.0
%
$
698
21.4
%
Total adjustments for items of note
61
177
264
Provision for income taxes and effective
income tax rate – adjusted
$
1,189
22.0
%
$
999
20.4
%
$
962
22.2
%
1
These amounts reflect tax credits as well as international earnings mix.
11
The Bank’s expectations regarding expense growth are based on the Bank’s assumptions
regarding certain factors, including risk and control investments, timing of business
investments, employee-related expenses, foreign exchange impact, gross-up of the retailer program partners’ share
of PCL for the Bank’s U.S. strategic card portfolio (“SCP Impact”),
and productivity and restructuring savings. In particular in estimating its expense growth expectations, the Bank
has assumed that the following three factors on the Bank’s fiscal 2026
adjusted expenses will be the same as the Bank’s fiscal 2025 adjusted expenses: (i) variable compensation
commensurate with higher revenue, (ii) foreign exchange translation, and (iii)
SCP Impact. For reference, in the first quarter of 2026, variable compensation, foreign exchange translation, and
the SCP impact, in the aggregate, accounted for approximately 1% of
the year-over-year 7% increase in adjusted non-interest expenses. The Bank’s assumptions are subject
to inherent uncertainties and may vary based on factors both within and outside
the Bank’s control, including the accuracy of the Bank’s employee compensation and
benefit expense forecasts, impact of business performance on variable compensation, inflation, the
pace of productivity initiatives across the organization, and unexpected expenses such as legal matters. Refer to
the “Risk Factors That May Affect Future Results” section of this
document for additional information about risks and uncertainties that may impact the Bank’s estimates
.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 14
ECONOMIC SUMMARY AND OUTLOOK
The global economy is forecast to slow in
calendar 2026 with decelerating cyclical
momentum reinforced by trade barriers.
The slowdown in global growth is
largely driven by slowing growth in Asia,
especially the fast-growing,
export-oriented emerging market
economies that are affected by U.S. tariffs. Other
economies, such as those in Europe, are seeing
a pickup in growth, largely from expectations
of higher government spending.
The U.S. economy has entered 2026 with
more momentum than was expected a quarter
ago. Growth in the second half of calendar
2025 picked up significantly
from a sub-par pace in the first half of the
year, buoyed by sustained strength in AI investments and
higher consumer spending. TD Economics
expects that tax
cuts, lower interest rates and some easing
on regulation and trade uncertainty will
help sustain solid momentum in the U.S.
economy in calendar 2026.
The U.S. labour market has shown signs of
stabilizing in recent months, after softening
through much of 2025. This led the Federal
Reserve to leave the federal
funds rate unchanged at a range of 3.5-3.75%
in January. The Federal Reserve is balancing inflation that remains
higher than its target with an unemployment
rate
above a level it considers consistent with “full
employment”. Inflation is expected
to cool after the one-time impact of tariffs has passed,
which should lead the
Federal Reserve to lower the policy rate further
over the coming months to 3.00-3.25%,
close to most estimates of a “neutral” level.
But the pace of interest rate
cuts will depend on the evolution of the job
and inflation data.
Canada’s economy continues to grow at a
modest pace. U.S. import tariffs have weighed on
growth both directly through lower exports
and indirectly through
the resulting uncertainty, which has weakened business and
consumer confidence about the future.
Job growth has also slowed in line with the economy.
However, slower population growth has depressed labour
force growth, pushing the unemployment
rate lower in recent months despite a generally
soft economic
backdrop. New federal defense and infrastructure
spending, an improvement in the housing
market and firmer business investments are
expected to drive a
modestly stronger growth picture in 2026.
The Canadian central bank left its overnight
rate steady at 2.25% in December and
January, after lowering its policy rate substantially since mid-2024.
Provided
inflation evolves in line with the Canadian
central bank’s current forecast, the overnight
rate is expected to remain unchanged over
the next several quarters. A
generally weaker U.S. dollar and a smaller
gap between U.S. and Canadian short-term interest
rates are expected to lift the Canadian dollar. TD Economics
expects the Canadian dollar to appreciate to
the 73-74 U.S. cent range by mid-2026, although
it is likely to be influenced by U.S. trade
policy.
HOW OUR BUSINESSES PERFORMED
For management reporting purposes, the Bank’s business
operations and activities are organized around
the following four key business segments:
Canadian
Personal and Commercial Banking, U.S. Banking,
Wealth Management and Insurance, and Wholesale
Banking. The Bank’s other activities are grouped
into the
Corporate segment.
Results of each business segment reflect revenue,
expenses, assets, and liabilities generated
by the businesses in that segment. Where
applicable,
the Bank
measures and evaluates the performance of
each segment based on adjusted results
and ROE, and for those segments,
the Bank indicates that the measure is
adjusted. For further details, refer to the “How
We Performed”
section of this document, the “Business
Focus”
section in the Bank’s 2025 MD&A, and Note
27 of
the Bank’s Annual Consolidated Financial
Statements for the year ended October 31,
2025.
PCL related to performing (Stage 1 and Stage
2) and impaired (Stage 3) financial assets, loan
commitments, and financial guarantees is recorded
within the
respective segment.
Net interest income within Wholesale Banking
is calculated on a taxable equivalent basis
(TEB), which means that the value of non-taxable
or tax-exempt
income, including certain dividends, is adjusted
to its equivalent pre-tax value. Using
TEB allows the Bank to measure income from
all securities and loans
consistently and makes for a more meaningful
comparison of net interest income with similar
institutions. The TEB increase to net interest income
and provision for
income taxes reflected in Wholesale Banking
results is reversed in the Corporate segment.
The TEB adjustment for the quarter was $17
million, compared with
$17 million in the prior quarter and $15 million
in the first quarter last year.
The Bank’s U.S. strategic cards portfolio is comprised
of agreements with certain U.S. retailers
pursuant to which TD is the U.S. issuer
of private label and co-
branded consumer credit cards to their U.S.
customers. Under the terms of the individual
agreements, the Bank and the retailers
share in the profits generated by
the relevant portfolios after credit losses.
Under IFRS, TD is required to present the gross
amount of revenue and PCL related to these
portfolios in the Bank’s
Interim Consolidated Statement of Income.
At the segment level, the retailer program
partners’ share of revenues and credit
losses is presented in the Corporate
segment, with an offsetting amount (representing
the partners’ net share) recorded in non-interest
expenses, resulting in no impact to Corporate’s
reported net
income (loss). The net income included in
the U.S. Banking segment includes only
the portion of revenue and credit losses attributable
to TD under the
agreements.
Effective the first quarter of 2026, non-interest income
within U.S. Banking is adjusted for the Bank’s
share of losses from community-based
tax-advantaged
investments accounted for using the equity
method which are reclassified to provision for income
taxes. This allows the Bank to measure the
effective tax rate for
U.S. Banking consistently with similar institutions.
The adjustment between non-interest income
and provision for income taxes reflected in
U.S. Banking results is
reversed in the Corporate segment. Comparative
amounts have been reclassified to conform
with the presentation adopted in the current period.
On February 12, 2025, the Bank sold its entire
remaining equity investment in Schwab.
Prior to the sale, the Bank accounted
for its investment in Schwab using
the equity method and the share of net income
from investment in Schwab was reported in
the U.S. Banking segment. Amounts for amortization
of acquired
intangibles,
the acquisition and integration charges related
to the Schwab transaction, and the Bank’s share
of restructuring and other charges incurred
by Schwab
were recorded in the Corporate segment.
Beginning in the third quarter of fiscal 2025,
the U.S. Banking segment no longer includes
contributions from Schwab
and consequently discussions of the U.S. Banking
segment’s performance exclude Schwab.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 15
12
TABLE 11: CANADIAN PERSONAL AND COMMERCIAL BANKING
(millions of Canadian dollars, except
as noted)
For the three months ended
January 31
October 31
January 31
2026
2025
2025
Net interest income
$
4,394
$
4,304
$
4,135
Non-interest income
1,027
1,001
1,014
Total revenue
5,421
5,305
5,149
Provision for (recovery of) credit losses –
impaired
424
447
459
Provision for (recovery of) credit losses –
performing
12
90
62
Total provision for (recovery of) credit losses
436
537
521
Non-interest expenses
2,147
2,178
2,086
Provision for (recovery of) income taxes
794
725
711
Net income
$
2,044
$
1,865
$
1,831
Selected volumes and ratios
Return on common equity
1
32.1
%
30.4
%
31.4
%
Net interest margin (including on securitized
assets)
2
2.83
2.82
2.81
Efficiency ratio
39.6
41.1
40.5
Number of Canadian retail branches
at period end
1,043
1,051
1,063
Average number of full-time equivalent staff
3
33,660
33,325
32,253
1
Capital allocated to the business segment was 11.5% CET1 Capital.
2
Net interest margin is calculated by dividing net interest income by average interest-earning assets. Average
interest-earning assets used in the calculation of net interest margin is a non-
GAAP financial measure. Refer to “Non-GAAP and Other Financial Measures” in the “How We Performed”
section and the Glossary of this document for additional information about
these metrics.
3
Effective the third quarter of 2025, call center operations have been realigned from the Corporate segment
to the businesses, providing end-to-end ownership of customer experience.
The change mainly impacts the Canadian Personal and Commercial Banking segment. Average number
of full-time equivalent staff has been restated for comparative periods.
Quarterly comparison – Q1 2026 vs. Q1 2025
Canadian Personal and Commercial
Banking net income for the quarter was
$2,044 million, an increase of $213
million, or 12%, compared with the first quarter
last year, reflecting higher revenue and lower PCL, partially
offset by higher non-interest expenses. The annualized
ROE for the quarter was 32.1%, compared
with 31.4% in the first quarter last year.
Revenue for the quarter was $5,421 million, an
increase of $272 million, or 5%,
compared with the first quarter last year. Net interest income
was $4,394 million,
an increase of $259 million, or 6%, primarily
reflecting volume growth and higher loan
margins. Average loan volumes increased $32 billion,
or 5%, reflecting 5%
growth in personal loans and 6% growth in
business loans. Average deposit volumes increased
$16 billion, or 3%, reflecting 3% growth in personal
deposits and
5% growth in business deposits. Net interest
margin was 2.83%, an increase of 2 basis points
(bps), primarily due to higher margins on loans,
partially offset by
changes in balance sheet mix. Non-interest
income was $1,027 million, an increase of
$13 million, or 1%.
PCL for the quarter was $436 million, a decrease
of $85 million compared with the first quarter
last year. PCL – impaired was $424 million, a decrease of
$35 million, or 8%, largely reflecting lower provisions
in the commercial lending portfolio, partially
offset by credit migration in the consumer lending
portfolios and
volume growth. PCL – performing was $12
million, a decrease of $50 million compared
with the first quarter last year. The performing provisions
this quarter were
largely related to credit migration in the
consumer lending portfolio and volume
growth, partially offset by the impact of a
model update in the other personal
lending portfolio and an improvement to the
macroeconomic forecast.
Total PCL as an annualized percentage of credit volume was 0.28%, a decrease
of 7 bps
compared with the first quarter last year.
Non-interest expenses for the quarter were $2,147
million, an increase of $61 million, or 3%,
compared with the first quarter last
year, primarily reflecting higher
employee-related expenses.
The efficiency ratio for the quarter was 39.6%, compared
with 40.5% in the first quarter last year.
Quarterly comparison – Q1 2026 vs. Q4 2025
Canadian Personal and Commercial
Banking net income for the quarter was
$2,044 million, an increase of $179
million, or 10%, compared with the prior quarter,
primarily reflecting higher revenue, lower PCL
and lower non-interest expenses. The annualized
ROE for the quarter was 32.1%, compared
with 30.4% in the prior
quarter.
Revenue increased $116 million, or 2%, compared with the prior
quarter. Net interest income increased $90 million, or 2%,
reflecting volume growth and higher
loan margins. Average loan volumes increased $9
billion, or 1%, reflecting 1% growth in personal
loans and 2% growth in business loans.
Average deposit
volumes increased $6 billion, or 1%, reflecting
1% growth in personal deposits and
2% growth in business deposits. Net interest
margin was 2.83%, an increase of
1 basis point (bp), primarily due to higher
margins on loans. As we look forward to
the second quarter, we expect net interest margin to be relatively
stable
.
Non-
interest income increased $26 million, or 3%,
compared with the prior quarter, reflecting business growth.
PCL for the quarter was $436 million, a decrease
of $101 million compared with the prior
quarter. PCL – impaired was $424 million, a decrease of
$23 million, or
5%, largely reflecting lower provisions in
the commercial lending portfolio, partially
offset by credit migration in the consumer lending
portfolios. PCL – performing
was $12 million, a decrease of $78 million compared
with the prior quarter. The performing provisions this quarter
were largely related to credit migration in
the
consumer lending portfolio and volume growth,
partially offset by the impact of a model update
in the other personal lending portfolio and
improvement to the
macroeconomic forecast. Total PCL as an annualized percentage of credit
volume was 0.28%, a decrease of 7 bps
compared with the prior quarter.
Non-interest expenses decreased $31 million, or
1%,
compared with the prior quarter.
The efficiency ratio was 39.6%, compared with 41.1%
in the prior quarter.
12
The Bank’s Q2 2026 net interest margin expectations for the segment are based on the Bank’s assumptions regarding factors such as Bank of Canada rate actions, competitive market dynamics, and
deposit reinvestment rates and maturity profiles, and are subject to inherent risks and uncertainties, including those set out in the “Risk Factors That May Affect Future Results” section of the Bank’s
2025 MD&A and the first quarter 2026 MD&A.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 16
TABLE 12: U.S. BANKING
(millions of dollars, except as noted)
For the three months ended
January 31
October 31
January 31
Canadian Dollars
2026
2025
2025
Net interest income
$
3,296
$
3,165
$
3,064
Non-interest income (loss) – reported
1
789
433
(118)
Non-interest income – adjusted
1,2,3
789
816
809
Total revenue – reported
4,085
3,598
2,946
Total revenue – adjusted
2
4,085
3,981
3,873
Provision for (recovery of) credit losses –
impaired
394
331
529
Provision for (recovery of) credit losses –
performing
(99)
(27)
(78)
Total provision for (recovery of) credit losses
295
304
451
Non-interest expenses – reported
2,468
2,500
2,380
Non-interest expenses – adjusted
2,4
2,512
2,500
2,380
Provision for (recovery of) income taxes – reported
1
282
75
(28)
Provision for (recovery of) income taxes – adjusted
1,2
271
170
203
U.S. Banking net income excluding Schwab
– reported
1,040
719
143
U.S. Banking net income excluding Schwab
– adjusted
2
1,007
1,007
839
Share of net income from investment in
Schwab
5,6
–
–
199
U.S. Banking net income – reported
$
1,040
$
719
$
342
U.S. Banking net income – adjusted
2
1,007
1,007
1,038
U.S. Dollars
Net interest income
$
2,372
$
2,281
$
2,160
Non-interest income (loss) – reported
1
569
315
(82)
Non-interest income – adjusted
1,2,3
569
589
570
Total revenue – reported
2,941
2,596
2,078
Total revenue – adjusted
2
2,941
2,870
2,730
Provision for (recovery of) credit losses –
impaired
284
238
371
Provision for (recovery of) credit losses –
performing
(72)
(18)
(53)
Total provision for (recovery of) credit losses
212
220
318
Non-interest expenses – reported
1,778
1,801
1,675
Non-interest expenses – adjusted
2,4
1,810
1,801
1,675
Provision for (recovery of) income taxes – reported
1
204
55
(20)
Provision for (recovery of) income taxes – adjusted
1,2
196
123
143
U.S. Banking net income excluding Schwab
– reported
747
520
105
U.S. Banking net income excluding Schwab
– adjusted
2
723
726
594
Share of net income from investment in
Schwab
5,6
–
–
142
U.S. Banking net income – reported
$
747
$
520
$
247
U.S. Banking net income – adjusted
2
723
726
736
Selected volumes and ratios
U.S. Banking return on common equity excluding
Schwab – reported
7
9.9
%
6.7
%
1.3
%
U.S. Banking return on common equity excluding
Schwab – adjusted
2,7
9.6
9.3
7.5
U.S. Banking return on common equity – reported
7
9.9
6.7
2.9
U.S. Banking return on common equity – adjusted
2,7
9.6
9.3
8.6
Net interest margin
2,8
3.38
3.25
2.86
Efficiency ratio – reported
1
60.5
69.4
80.6
Efficiency ratio – adjusted
1,2
61.5
62.8
61.4
Assets under administration (billions of U.S.
dollars)
9
$
47
$
46
$
43
Assets under management (billions of U.S.
dollars)
9
11
10
9
Number of U.S. banking stores
1,049
1,100
1,134
Average number of full-time equivalent staff
29,877
29,158
28,276
1
Effective the first quarter of 2026, non-interest income within U.S. Banking is adjusted
for the Bank’s share of losses from community-based tax-advantaged investments
accounted for
using the equity method which are reclassified to provision for income taxes. The adjustment between non-interest
income and provision for income taxes reflected in U.S. Banking results
is reversed in the Corporate segment. The adjustment for the quarter was $184 million (US$132 million),
compared with $145 million (US$105 million) in the prior quarter and $164 million
(US$116 million) in the first quarter last year.
Comparative amounts have been reclassified to conform with the presentation adopted in the current period.
2
For additional information about the Bank’s use of non-GAAP financial measures, refer to “Non-GAAP
and Other Financial Measures” in the “How We Performed” section,
and the
Glossary of this document.
3
Adjusted non-interest income excludes the following item of note:
i.
Balance sheet restructuring – Q4 2025: $383 million or US$274 million ($288 million or US$206 million after-tax),
Q1 2025: $927 million or US$652 million ($696 million or
US$489 million after-tax).
4
Adjusted non-interest expenses exclude the following item of note:
i.
FDIC special assessment – Q1 2026: ($44) million or US($32)
million (($33) million or US($24) million after-tax).
5
The Bank’s share of Schwab’s earnings was reported with a one-month lag. Refer to
Note 7 of the Bank’s first quarter 2026 Interim Consolidated Financial Statements for
further details.
6
The after-tax amount for amortization of acquired intangibles was recorded in the Corporate segment.
7
Capital allocated to the business segment was 11.5% CET1
Capital.
8
Net interest margin is calculated by dividing U.S. Banking segment’s net interest income
by average interest-earning assets excluding the impact related to sweep deposits arrangements
and the impact of intercompany deposits and cash collateral, which management believes better reflects segment
performance. In addition, the value of tax-exempt interest income is
adjusted to its equivalent before-tax value. For investment securities, the adjustment to fair value is included in the
calculation of average interest-earning assets. Net interest income and
average interest-earning assets used in the calculation are non-GAAP financial measures.
9
For additional information about this metric, refer to the Glossary of this document.
Quarterly comparison – Q1 2026 vs. Q1 2025
U.S. Banking reported net income was $1,040
million (US$747 million), an increase of
$897 million (US$642 million), compared
with the first quarter last year, and
U.S. Banking adjusted net income was $1,007
million (US$723 million), an increase of
$168 million (US$129 million), compared
with the first quarter last year, both
reflecting the impact of U.S. balance
sheet restructuring activities and lower PCL,
partially offset by higher governance and
control investments, including costs for
U.S. BSA/AML remediation in
the current quarter,
and higher employee-related expenses.
The reported and adjusted annualized
ROE for the quarter were 9.9%
and 9.6%, respectively, compared with
1.3% and 7.5%, respectively, in the
first quarter last year.
Reported and adjusted revenue for the quarter
was US$2,941 million, an increase of US$863
million, or 42%, on a reported basis, and an
increase of
US$211 million, or 8%, on an adjusted basis,
compared with the first quarter last year. Net
interest income of US$2,372 million, increased
US$212 million, or 10%,
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 17
13
14
15
largely reflecting higher product margins and
the impact of U.S. balance sheet restructuring
activities. Net interest margin of 3.38%,
increased 52 bps, due to
higher product margins, the impact of U.S.
balance sheet restructuring activities, and
the normalization of elevated liquidity levels (which
positively impacted net
interest margin by 19 bps). Reported and
adjusted non-interest income was US$569
million, an increase of US$651 million,
on a reported basis, compared with
the first quarter last year, reflecting the impact
of U.S. balance sheet restructuring activities
in the first quarter last year. On an adjusted
basis, non-interest income
was relatively flat compared with the
first quarter last year.
Average loan volumes decreased US$18
billion, or 9%, compared with the first quarter
last year. Personal loans decreased 7% and business
loans decreased
11%, reflecting U.S. balance sheet restructuring
activities. Excluding the impact of
the loan portfolios identified for sale or run-off under
our U.S. balance sheet
restructuring program, core average loan
volumes increased US$3 billion, or 2%
,
. Average deposit volumes
decreased US$14 billion, or 4%, reflecting
a 13%
decrease in sweep deposits, a 2% decrease in
personal deposits, and a 1% decrease
in business deposits.
Assets under administration (AUA) were US$47
billion as at January 31, 2026, an increase
of US$4 billion, or 9%, compared with the
first quarter last year, and
assets under management (AUM) were US$11
billion as of January 31, 2026, an increase
of US$2 billion, or 22%, compared with
the first quarter last year, both
reflecting net asset growth and market appreciation.
PCL for the quarter was US$212
million, a decrease of US$106 million
compared with the first quarter last year. PCL
– impaired was US$284 million, a decrease
of US$87 million, or 23%, reflecting lower provisions
in both the consumer and commercial lending
portfolios. PCL – performing was
a recovery of US$72 million,
compared with a recovery of US$53 million
in the first quarter last year. The performing
recovery this quarter largely reflects an
improvement to the
macroeconomic forecast and migration
from performing to impaired in the commercial
lending portfolio. U.S. Banking PCL
including only the Bank’s share of PCL
in the U.S. strategic cards portfolio, as an
annualized percentage of credit volume
was 0.49%, a decrease of 18 bps compared
with the first quarter last year.
Reported non-interest expenses for the quarter were
US$1,778 million, an increase of US$103
million, or 6%, compared to the first quarter
last year, reflecting
higher governance and control investments including
costs of US$148 million for U.S. BSA/AML
remediation, and higher employee-related
expenses, partially
offset by the expense recovery of the FDIC
special assessment charge.
Adjusted non-interest expenses for the quarter
were US$1,810 million, an increase of
US$135 million, or 8%, reflecting higher governance
and control investments, including costs for U.S.
BSA/AML remediation, and higher employee-related
expenses.
The reported and adjusted efficiency ratios
for the quarter were 60.5% and 61.5%, respectively,
compared with 80.6% and 61.4%, respectively,
in the first
quarter last year.
Quarterly comparison – Q1 2026 vs. Q4 2025
U.S. Banking reported net income was $1,040
million (US$747 million), an increase of
$321 million (US$227 million), or 45% (44%
in U.S. dollars), compared with
the prior quarter, primarily reflecting the impact
of U.S. balance sheet restructuring activities
in the prior quarter, an adjustment for client
deposit rates in the prior
quarter, and the expense recovery of the FDIC
special assessment charge in the current
quarter, partially offset by higher employee-related
expenses and lower
fee income.
U.S. Banking adjusted net income was $1,007
million (US$723 million), relatively flat
compared to the prior quarter, primarily
reflecting higher
employee-related expenses and lower fee income,
largely offset by an adjustment for client deposit
rates in the prior quarter. The reported
and adjusted
annualized ROE for the quarter were 9.9%
and 9.6%, respectively, compared with
6.7% and 9.3%, respectively, in the prior
quarter.
Reported and adjusted revenue for the quarter
was US$2,941 million, an increase of US$345
million, or 13%, on a reported basis, and an
increase of
US$71 million, or 2%, on an adjusted basis,
compared with the prior quarter. Net interest
income of US$2,372 million, increased US$91
million, or 4%, largely
reflecting an adjustment for client deposit
rate in the prior quarter and higher loan margins
in the current quarter. Reported net interest
margin of 3.38%, increased
13 bps, due to an adjustment for client deposit
rates in the prior quarter and higher loan margins
from improved product mix. Net interest margin
is expected to
modestly increase
in the second quarter of fiscal 2026
. Reported and adjusted non
-
interest income was US$569 million, an
increase of US$254
million, or 81%,
on a reported basis, reflecting the impact
of U.S. balance sheet restructuring activities
in the prior quarter, partially offset by lower
fee income. On an adjusted
basis, non-interest income decreased US$20
million, or 3%, reflecting lower fee
income.
Average loan volumes decreased US$2
billion, or 1%, compared with the prior
quarter, reflecting a 3% decrease in business
loans, partially offset by a 1%
increase in personal loans. Excluding
the impact of the loan portfolios identified for
sale or run-off under our U.S. balance sheet
restructuring program, core
average loan volumes increased US$1 billion,
or 1%
13
,14
. Average deposit volumes decreased
US$5 billion, or 2%, compared with the
prior quarter, reflecting a 5%
decrease in sweep deposits. Personal deposits
and business deposits are relatively
flat compared to the prior quarter.
AUA were US$47 billion as
at January 31, 2026, an increase of US$1
billion, or 2%, compared with the prior quarter,
and AUM were US$11
billion as at
January 31, 2026, an increase of US$1 billion
or 10%, compared with the prior quarter,
both reflecting net asset growth and market
appreciation.
PCL for the quarter was US$212
million, a decrease of US$8 million compared
with the prior quarter. PCL – impaired
was US$284
million, an increase of
US$46 million, or 19%, largely reflecting
higher provisions in the commercial lending
portfolio. PCL – performing was
a recovery of US$72
million, compared with a
recovery of US$18 million in the prior quarter.
The performing recovery this quarter largely
reflects an improvement to the macroeconomic
forecast and migration
from performing to impaired in the commercial
lending portfolio. U.S. Banking PCL
including only the Bank’s share of PCL
in the U.S. strategic cards portfolio, as
an annualized percentage of credit volume was
0.49%, a decrease of 1 bp compared
with the prior quarter.
Reported non-interest expenses for the quarter were
US$1,778 million, a decrease of US$23
million, or 1%, compared with the prior quarter,
reflecting the
expense recovery of the FDIC special assessment
charge, partially offset by higher employee-related
expenses. Adjusted non-interest
expenses for the quarter
were US$1,810 million, an increase of US$9
million, compared with the prior quarter,
reflecting higher employee-related costs.
The reported and adjusted efficiency ratios
for the quarter were 60.5% and 61.5%, respectively,
compared with 69.4% and 62.8%, respectively,
in the prior
period.
Following the end of the first quarter of fiscal
2026,
the Bank completed the conversion of its
Nordstrom credit card portfolio onto the Bank’s servicing
platform. The
Bank became the servicer of the portfolio
and will receive a greater share of revenue
and credit losses.
The Bank expects a charge of approximately
US$145 million pre-tax, reflecting an adjustment
of amounts to be recovered from Nordstrom
for future credit losses,
to be recorded as an Item of Note in the
second quarter of fiscal 2026.
13
Loan portfolios identified for sale or run-off include the Point-of-Sale finance business which services third
party retailers, correspondent lending, export and import lending, commercial
auto dealer portfolio, and other non-core portfolios. Q1 2026 average loan volumes: US$175 billion (Q4 2025: US$177
billion; Q1 2025: US$192
billion). Q1 2026 average loan volumes
of loan portfolios identified for sale or run-off: US$11
billion (Q4 2025: US$14 billion; Q1 2025: US$32 billion). Q1 2026 average loan volumes excluding loan
portfolios identified for sale
or run-off: US$164 billion (Q4 2025: US$163
billion; Q1 2025: US$160 billion).
14
For additional information about the Bank’s use of non-GAAP financial measures, refer to “Non-GAAP and Other Financial Measures”
in the “How We Performed” section of this
document.
15
The Bank’s Q2 2026 net interest margin expectations for the segment are based on the Bank’s assumptions regarding
interest rates, deposit reinvestment rates, average asset levels,
execution of planned restructuring opportunities, and other variables, and are subject to inherent risks and uncertainties,
including those set out in the “Risk Factors That May Affect
Future Results” section of this document.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 18
TABLE 13: WEALTH MANAGEMENT AND INSURANCE
(millions of Canadian dollars, except
as noted)
For the three months ended
January 31
October 31
January 31
2026
2025
2025
Net interest income
$
406
$
389
$
369
Non-interest income
3,500
3,399
3,229
Total revenue
3,906
3,788
3,598
Insurance service expenses
1
1,622
1,602
1,507
Non-interest expenses
1,258
1,239
1,173
Provision for (recovery of) income taxes
269
248
238
Net income
$
757
$
699
$
680
Selected volumes and ratios
Return on common equity
45.3
%
43.1
%
42.7
%
Return on common equity – Wealth Management
2
66.3
66.3
61.9
Return on common equity – Insurance
22.7
18.1
21.9
Efficiency ratio
32.2
32.7
32.6
Efficiency ratio, net of ISE
3
55.1
56.7
56.1
Assets under administration (billions of Canadian
dollars)
4
$
771
$
759
$
687
Assets under management (billions of Canadian
dollars)
610
601
556
Average number of full-time equivalent staff
15,872
15,829
15,176
1
Includes estimated losses related to catastrophe claims – Q1 2026: $7 million, Q4 2025: $15 million, Q1 2025: nil
.
2
Capital allocated to the business was 11.5% CET1 Capital.
3
Efficiency ratio, net of ISE is calculated by dividing non-interest expenses by total revenue, net of ISE.
Total revenue, net of ISE
– Q1 2026: $2,284 million, Q4 2025: $2,186 million,
Q1 2025: $2,091 million. Total revenue,
net of ISE is a non-GAAP financial measure. Refer to “Non-GAAP and Other Financial Measures” in the
“How We Performed” section and the
Glossary of this document for additional information about this metric.
4
Includes
AUA administered by TD Investment Services Inc. which is part of the Canadian Personal and Commercial
Banking segment.
Quarterly comparison – Q1 2026 vs. Q1 2025
Wealth Management and Insurance net income
for the quarter was $757 million, an increase
of $77 million, or 11%, compared with the first quarter last year,
reflecting Wealth Management net income of
$574 million, an increase of $62 million,
or 12%, compared with the first quarter
last year, and Insurance net income
of $183 million, an increase of $15 million, or 9%,
compared with the first quarter last year. The annualized
ROE for the quarter was 45.3%, compared
with 42.7%
in the first quarter last year. Wealth Management annualized ROE
for the quarter was 66.3%, compared
with 61.9% in the first quarter last year, and Insurance
annualized ROE for the quarter was 22.7%
compared with 21.9% in the first quarter last
year.
Revenue for the quarter was $3,906 million, an increase
of $308 million, or 9%, compared
with the first quarter last year. Non-interest income was
$3,500 million, an increase of $271 million, or
8%, reflecting higher insurance earned
premiums, fee-based revenues
from asset growth, and transaction revenue.
Net interest income was $406 million, an increase
of $37 million, or 10%, compared
with the first quarter last year, reflecting higher deposit
volumes.
AUA were $771 billion as at January 31, 2026,
an increase of $84 billion, or 12%, and AUM
were $610 billion as at January 31, 2026,
an increase of $54 billion,
or 10%, compared with the first quarter last
year, both reflecting market appreciation and net asset growth.
Insurance service expenses for the quarter
were $1,622 million, an increase of $115 million, or 8%, compared
with the first quarter last year, primarily reflecting
increased claims severity.
Non-interest expenses for the quarter were $1,258
million, an increase of $85 million, or
7%, compared with the first quarter
last year, reflecting higher variable
compensation commensurate with higher
revenue, increased technology investments,
and higher employee-related expenses.
The efficiency ratio for the quarter was 32.2%,
compared with 32.6% in the first quarter
last year. The efficiency ratio, net of ISE for the quarter was
55.1%,
compared with 56.1% in the first quarter last
year.
Quarterly comparison – Q1 2026 vs. Q4 2025
Wealth Management and Insurance net income
for the quarter was $757 million, an increase
of $58 million, or 8%, compared with the prior
quarter, reflecting
Wealth Management net income of $574 million,
an increase of $17 million, or 3%, compared
with the prior quarter, and Insurance net income of $183 million,
an
increase of $41 million, or 29%, compared
with the prior quarter. The annualized ROE for the quarter
was 45.3%, compared with 43.1% in the prior quarter. Wealth
Management annualized ROE for the quarter
was 66.3%, flat to the prior quarter, and Insurance annualized
ROE for the quarter was 22.7% compared
with 18.1%
in the prior quarter.
Revenue increased $118 million, or 3%, compared with the prior
quarter. Non-interest income increased $101 million, or
3%, reflecting strong underlying
insurance performance and higher fee-based revenues.
Net interest income increased $17 million, or
4%, reflecting higher deposit volumes.
AUA increased $12 billion, or 2%, and AUM
increased $9 billion, or 1%, compared
with the prior quarter, both reflecting market appreciation.
Insurance service expenses were relatively
flat compared with the prior quarter.
Non-interest expenses for the quarter were $1,258
million, an increase of $19 million, or
2%, compared with the prior quarter, primarily reflecting higher
variable
compensation commensurate with higher
revenue.
The efficiency ratio for the quarter was 32.2%,
compared with 32.7% in the prior quarter. The efficiency ratio,
net of ISE for the quarter was 55.1%, compared
with 56.7% in the prior quarter.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 19
TABLE 14: WHOLESALE BANKING
(millions of Canadian dollars, except
as noted)
For the three months ended
January 31
October 31
January 31
2026
2025
2025
Net interest income (loss) (TEB)
$
(75)
$
(66)
$
(107)
Non-interest income
2,545
2,266
2,107
Total revenue
2,470
2,200
2,000
Provision for (recovery of) credit losses –
impaired
216
28
33
Provision for (recovery of) credit losses –
performing
(44)
(4)
39
Total provision for (recovery of) credit losses
172
24
72
Non-interest expenses – reported
1,563
1,559
1,535
Non-interest expenses – adjusted
1,2
1,563
1,515
1,483
Provision for (recovery of) income taxes
(TEB) – reported
174
123
94
Provision for (recovery of) income taxes
(TEB) – adjusted
1
174
132
105
Net income – reported
$
561
$
494
$
299
Net income – adjusted
1
561
529
340
Selected volumes and ratios
Trading-related revenue (TEB)
3
$
1,146
$
865
$
904
Average gross lending portfolio (billions of Canadian
dollars)
4
93.9
90.0
100.9
Return on common equity – reported
5
12.6
%
11.6
%
7.3
%
Return on common equity – adjusted
1,5
12.6
12.4
8.3
Efficiency ratio – reported
63.3
70.9
76.8
Efficiency ratio – adjusted
1
63.3
68.9
74.2
Average number of full-time equivalent staff
7,334
7,438
6,919
1
For additional information about the Bank’s use of non-GAAP financial measures, refer to “Non-GAAP
and Other Financial Measures” in the “How We Performed” section,
and the
Glossary of this document.
2
Adjusted non-interest expenses exclude the acquisition and integration-related charges for the Cowen acquisition
– Q4 2025: $44 million ($35 million after tax), Q1 2025: $52 million
($41 million after tax).
3
Includes net interest income (loss) TEB of ($455) million, (Q4 2025: ($419) million, Q1 2025: ($404) million), and
trading income (loss) of $1,601 million (Q4 2025: $1,284 million,
Q1 2025: $1,308 million). Trading-related revenue (TEB) is a non-GAAP financial
measure. Refer to “Non-GAAP and Other Financial Measures” in the “How We Performed”
section and
the Glossary of this document for additional information about this metric.
4
Includes gross loans relating to Wholesale Banking, excluding letters of credit, cash collateral, credit default swaps,
and allowance for credit losses.
5
Capital allocated to the business segment was 11.5% CET1 Capital.
Quarterly comparison – Q1 2026 vs. Q1 2025
Wholesale Banking reported and adjusted net
income for the quarter were $561
million. Reported net income for the quarter
increased $262 million, or 88%,
compared with the first quarter last year, primarily reflecting
higher revenues, partially offset by higher PCL
and non-interest expenses. On an
adjusted basis, net
income increased
$221 million, or 65%, compared with the
first quarter last year.
Revenue for the quarter was $2,470 million, an
increase of $470 million, or 24%,
compared with the first quarter last year. Higher revenue
primarily reflects
higher trading-related revenue, lending revenue,
advisory fees, and underwriting fees,
partially offset by the net change in fair value of
loan underwriting
commitments.
PCL for the quarter was $172 million, an increase
of $100 million compared with the first
quarter last year. PCL – impaired was $216
million, an increase of
$183 million compared with the prior
year, primarily reflecting a small number of impairments across
various industries. PCL – performing was
a recovery of
$44 million, compared with a build of $39
million in the prior year. The performing recovery this quarter
was driven by migration from performing to impaired.
Reported non-interest expenses for the quarter
were $1,563 million, an increase of $28
million, or 2%, compared with the first quarter
last year, primarily
reflecting higher operating costs, including technology
and front office, spend supporting business
growth, and higher variable compensation,
partially offset by the
cessation of acquisition and integration-related
costs. On an adjusted basis, non-interest expenses
were $1,563 million, an increase of $80 million,
or 5%.
Quarterly comparison – Q1 2026 vs. Q4 2025
Wholesale Banking reported and adjusted net
income for the quarter were $561
million. Reported net income increased
$67 million, or 14%, compared with the
prior quarter, primarily reflecting higher revenues, partially offset by
higher PCL and non-interest expenses.
On an adjusted basis, net income increased
$32 million, or 6%.
Revenue for the quarter increased $270 million,
or 12%, compared with the prior quarter. Higher revenue
primarily reflects higher trading-related
revenue,
lending revenue,
and net change in fair value of the equity
investment portfolio, partially offset by lower underwriting
and advisory fees.
PCL for the quarter was $172 million, an increase
of $148 million compared with the prior quarter. PCL – impaired
was $216
million, an increase of $188 million,
primarily reflecting a small number of impairments
across various industries. PCL – performing
was a recovery of $44 million, compared
with a recovery of
$4 million in the prior quarter. The performing recovery this
quarter was driven by migration from performing
to impaired.
Reported non-interest expenses for the quarter
increased $4 million, relatively flat
compared with the prior quarter, primarily reflecting higher
variable
compensation, partially offset by higher acquisition
and integration-related costs and higher
spend supporting business growth in the prior
quarter. On an adjusted
basis, non-interest expenses increased $48
million, or 3%.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 20
TABLE 15: CORPORATE
(millions of Canadian dollars)
For the three months ended
January 31
October 31
January 31
2026
2025
2025
Net income (loss) – reported
$
(359)
$
(497)
$
(359)
Adjustments for items of note
Amortization of acquired intangibles
34
34
61
Restructuring charges
200
190
–
Impact from the terminated FHN acquisition-related
capital hedging strategy
44
49
54
Balance sheet restructuring
–
102
–
Less: impact of income taxes on items
of note
72
73
22
Net income (loss) – adjusted
1
$
(153)
$
(195)
$
(266)
Decomposition of items included in net
income (loss) – adjusted
Net corporate expenses
1
$
(515)
$
(537)
$
(370)
Other
362
342
104
Net income (loss) – adjusted
1
$
(153)
$
(195)
$
(266)
Selected volumes
Average number of full-time equivalent staff
2
18,098
18,371
17,800
1
For additional information about the Bank’s use of non-GAAP financial measures, refer to “Non-GAAP
and Other Financial Measures” in the “How We Performed” section,
and the
Glossary of this document.
2
Effective the third quarter of 2025, call center operations have been realigned from the Corporate segment
to the businesses, providing end-to-end ownership of customer experience.
The change mainly impacts the Canadian Personal and Commercial Banking segment. Average number
of full-time equivalent staff has been restated for comparative periods.
Quarterly comparison – Q1 2026 vs. Q1 2025
Corporate segment’s reported net loss for the quarter
was $359 million, flat compared with the
first quarter last year. The year-over-year net loss primarily reflects
restructuring charges and higher net corporate
expenses, largely offset by higher revenue
from treasury and balance sheet management
activities. Net corporate
expenses increased $145 million compared
with the first quarter last year, primarily reflecting continued
investments in governance and controls.
The adjusted net
loss for the quarter was $153 million, compared
with $266 million in the prior year.
Quarterly comparison – Q1 2026 vs. Q4 2025
Corporate segment’s reported net loss for the quarter
was $359 million, compared with $497
million in the prior quarter. The lower net loss primarily reflects
the
impact of balance sheet restructuring activities
in the prior quarter. The adjusted net loss for the quarter
was $153 million, compared with $195 million
in the prior
quarter.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 21
QUARTERLY
RESULTS
The following table provides summary information
related to the Bank’s eight most recently
completed quarters.
TABLE 16: QUARTERLY RESULTS
(millions of Canadian dollars, except as noted)
For the three months ended
2026
2025
2024
Jan. 31
Oct. 31
Jul. 31
Apr. 30
Jan. 31
Oct. 31
Jul. 31
Apr. 30
Net interest income
$
8,789
$
8,545
$
8,526
$
8,125
$
7,866
$
7,940
$
7,579
$
7,465
Non-interest income
7,796
6,949
6,771
14,812
6,183
7,574
6,597
6,354
Total revenue
16,585
15,494
15,297
22,937
14,049
15,514
14,176
13,819
Provision for (recovery of) credit losses
1,039
982
971
1,341
1,212
1,109
1,072
1,071
Insurance service expenses
1,622
1,602
1,563
1,417
1,507
2,364
1,669
1,248
Non-interest expenses
8,753
8,808
8,522
8,139
8,070
8,050
11,012
8,401
Provision for (recovery of) income taxes
1,128
822
905
985
698
534
794
729
Share of net income from investment in Schwab
–
–
–
74
231
178
190
194
Net income (loss) – reported
4,043
3,280
3,336
11,129
2,793
3,635
(181)
2,564
Pre-tax adjustments for items of note
1
Amortization of acquired intangibles
34
34
33
43
61
60
64
72
Acquisition and integration charges related to the
Schwab transaction
2,3
–
–
–
–
–
35
21
21
Restructuring charges
200
190
333
163
–
–
110
165
Acquisition and integration-related charges
–
44
32
34
52
82
78
102
Impact from the terminated FHN acquisition-related
capital hedging strategy
44
49
55
47
54
59
62
64
Gain on sale of Schwab shares
4
–
–
–
(8,975)
–
(1,022)
–
–
Balance sheet restructuring
5
–
485
262
1,129
927
311
–
–
Indirect tax matters
2,5
–
–
–
–
–
226
–
–
Civil matter provision
2
–
–
–
–
–
–
–
274
FDIC special assessment
(44)
–
–
–
–
(72)
–
103
Global resolution of the investigations into the
Bank’s U.S. BSA/AML program
2
–
–
–
–
–
52
3,566
615
Total pre-tax adjustments
for items of note
1
234
802
715
(7,559)
1,094
(269)
3,901
1,416
Less: Impact of income taxes
61
177
180
(56)
264
161
74
191
Net income – adjusted
1
4,216
3,905
3,871
3,626
3,623
3,205
3,646
3,789
Preferred dividends and distributions on other
equity instruments
101
191
88
200
86
193
69
190
Net income available to common
shareholders – adjusted
1
$
4,115
$
3,714
$
3,783
$
3,426
$
3,537
$
3,012
$
3,577
$
3,599
(Canadian dollars, except as noted)
Basic earnings (loss) per share
Reported
$
2.35
$
1.82
$
1.89
$
6.28
$
1.55
$
1.97
$
(0.14)
$
1.35
Adjusted
1
2.45
2.19
2.20
1.97
2.02
1.72
2.05
2.04
Diluted earnings (loss) per share
Reported
2.34
1.82
1.89
6.27
1.55
1.97
(0.14)
1.35
Adjusted
1
2.44
2.18
2.20
1.97
2.02
1.72
2.05
2.04
Return on common equity – reported
13.6
10.7
%
11.3
%
39.1
%
10.1
%
13.4
%
(1.0)
%
9.5
%
Return on common equity – adjusted
1
14.2
12.8
13.2
12.3
13.2
11.7
14.1
14.5
(billions of Canadian dollars, except as noted)
Average total assets
$
2,121
$
2,102
$
2,112
$
2,156
$
2,063
$
2,035
$
1,968
$
1,938
Average interest-earning assets
6
1,882
1,863
1,855
1,894
1,883
1,835
1,778
1,754
Net interest margin – reported
1.85
1.82
%
1.82
%
1.76
%
1.66
%
1.72
%
1.70
%
1.73
%
Net interest margin – adjusted
1
1.86
1.83
1.83
1.78
1.67
1.74
1.71
1.75
1
For explanations of items of note, refer to the “Significant Events”
and “Non-GAAP Financial Measures – Reconciliation of Adjusted to Reported Net Income” table in the
“How We
Performed” section of this document.
2
Adjusted non-interest expenses exclude the following items of note:
i.
The Bank’s own acquisition and integration charges related to the Schwab transaction, reported in the
Corporate segment;
ii.
Indirect tax matters, reported in the Corporate segment;
iii.
Civil matter provision, reported in the Corporate segment; and
iv.
Charges for the global resolution of the investigations into the Bank’s U.S. BSA/AML program, reported
in the U.S. Banking segment.
3
Adjusted share of net income from investment in Schwab excludes the following item of note on an after-tax basis.
The earnings impact of this item was reported in the Corporate
segment:
i.
The Bank’s share of acquisition and integration charges associated with Schwab’s acquisition
of TD Ameritrade.
4
Adjusted non-interest income excludes the following item of note:
i.
The Bank sold common shares of Schwab and recognized a gain on the sale, reported in the Corporate segment.
5
Adjusted net interest income excludes the following items of note:
i.
Balance sheet restructuring in respect of U.S. Banking activities, reported in the U.S. Banking segment; and
ii.
Indirect tax matters, reported in the Corporate segment.
6
Average interest-earning assets used in the calculation of net interest margin is a non-GAAP financial
measure. Refer to “Non-GAAP and Other Financial Measures” in the “How We
Performed” section and the Glossary of this document for additional information about these metrics.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 22
BALANCE SHEET REVIEW
TABLE 17: SELECTED INTERIM CONSOLIDATED BALANCE SHEET ITEMS
(millions of Canadian dollars)
As at
January 31, 2026
October 31, 2025
Assets
Cash and Interest-bearing deposits
with banks
$
119,959
$
116,929
Trading loans, securities, and other
234,888
220,136
Non-trading financial assets at fair value through
profit or loss
8,425
7,395
Derivatives
83,371
82,972
Financial assets designated at fair value through
profit or loss
7,038
6,986
Financial assets at fair value through other
comprehensive income
127,872
126,369
Debt securities at amortized cost, net of allowance
for credit losses
234,270
240,439
Securities purchased under reverse repurchase
agreements
222,925
247,078
Loans, net of allowance for loan losses
958,486
953,012
Other
102,072
93,242
Total assets
$
2,099,306
$
2,094,558
Liabilities
Trading deposits
$
42,328
$
37,882
Derivatives
83,495
79,356
Financial liabilities designated at fair value
through profit or loss
225,237
197,635
Deposits
1,245,144
1,267,104
Obligations related to securities sold
under repurchase agreements
213,782
221,150
Subordinated notes and debentures
10,642
10,733
Other
153,082
152,871
Total liabilities
1,973,710
1,966,731
Total equity
125,596
127,827
Total liabilities and equity
$
2,099,306
$
2,094,558
Total assets
were $2,099 billion as at January 31, 2026,
an increase of $4 billion from October 31,
- The impact of foreign exchange
translation from the
appreciation in the Canadian dollar decreased
total assets by $29 billion.
The increase in total assets reflects an increase
in trading loans, securities, and other of
$15 billion, other assets of $9 billion, loans, net
of allowances for loan
losses of $5 billion, cash and interest-bearing
deposits with banks of $3 billion, financial
assets at fair value through other comprehensive
income (FVOCI) of
$1 billion, and non-trading financial assets
at fair value through profit or loss of $1
billion. The increase was partially offset by a decrease
in securities purchased
under reverse repurchase agreements of $24
billion, and debt securities at amortized
cost, net of allowance for credit losses
of $6 billion.
Cash and interest-bearing deposits with
banks
increased $3 billion primarily reflecting
cash management activities.
Trading loans, securities, and other
increased $15 billion primarily in equity securities,
government and government-related
debt securities, and other debt
securities, partially offset by the impact of foreign
exchange translation and a decrease in trading
loans.
Non-trading financial assets at fair
value through profit or loss
increased $1 billion primarily reflecting
new investments.
Financial assets at fair value through other
comprehensive income
increased $1 billion reflecting new investments,
partially offset by maturities and the
impact of foreign exchange translation.
Debt securities at amortized cost, net
of allowance for credit losses
decreased $6 billion primarily reflecting
maturities and the impact of foreign exchange
translation, partially offset by new investments.
Securities purchased under reverse repurchase
agreements
decreased $24 billion
primarily
reflecting a decrease in volume and the impact
of foreign
exchange translation.
Loans, net of allowance for loan losses
increased $5 billion primarily reflecting
volume growth in consumer instalment
and business and government loans,
partially offset by the impact of foreign exchange
translation and a decrease in residential
mortgages.
Other assets
increased $9 billion primarily reflecting
an increase in amounts receivable
from brokers, dealers, and clients due to
higher volumes of pending
trades.
Total liabilities
were $1,974 billion as at January 31, 2026,
an increase of $6 billion from October 31,
- The impact of foreign exchange
translation from the
appreciation in the Canadian dollar decreased
total liabilities by $30 billion.
The increase in total liabilities reflects an
increase in financial liabilities designated
at fair value through profit or loss of $27 billion,
trading deposits of $4 billion and
derivatives of $4 billion. The increase was
partially offset by a decrease in deposits of $22
billion and obligations related to securities
sold under repurchase
agreements of $7 billion.
Trading deposits
increased $4 billion primarily reflecting
new issuances, partially offset by maturities.
Derivative
liabilities
increased $4 billion primarily reflecting
an increase in mark-to-market values
of commodity contracts and foreign exchange
contracts, partially
offset by a decrease in interest rate contracts.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 23
Financial liabilities designated at fair value
through profit or loss
increased $27 billion primarily reflecting
new issuances, partially offset by maturities and
the
impact of foreign exchange translation.
Deposits
decreased $22 billion primarily reflecting
the impact of foreign exchange translation
and lower volumes in personal and bank deposits.
Obligations related to securities sold
under repurchase agreements
decreased $7 billion primarily reflecting
the impact of foreign exchange translation
and a
decrease in volume.
Equity
was $126 billion as at January 31, 2026,
a decrease of $2 billion from October
31, 2025. The decrease reflects losses
in accumulated other comprehensive
income, primarily driven by unrealized
foreign currency translation and cash flow hedges.
The retained earnings is flat as the net income
for the period is offset by
the premium on the repurchase of common
shares and dividend distributions.
CREDIT PORTFOLIO QUALITY
Quarterly comparison – Q1 2026 vs. Q1 2025
Gross impaired loans were $5,594 million
as at January 31, 2026, an increase of $141
million, or 3%, compared with the first quarter
last year. Canadian Personal
and Commercial Banking gross impaired
loans decreased $5 million, relatively flat
compared with the first quarter last year, reflecting lower impairments
in the
commercial lending portfolio, partially offset by
higher impairments in the consumer lending
portfolios. U.S. Banking gross impaired
loans decreased $17 million, or
1%, compared with the first quarter last year, reflecting the impact
of foreign exchange, partially offset by higher
impairments in the commercial and
consumer
lending portfolios. Wholesale gross impaired
loans increased $165 million, compared
with the first quarter last year, reflecting formations outpacing resolutions.
Net impaired loans were $3,900 million as
at January 31, 2026, an increase of $265
million, or 7%, compared with the first quarter
last year.
The allowance for credit losses of $9,601
million as at January 31, 2026 was comprised
of Stage 3 allowance for impaired loans of $1,700
million, Stage 2
allowance of $4,705 million and Stage 1 allowance
of $3,192 million, and the allowance for debt
securities of $4 million. The Stage 1 and 2 allowances
are for
performing loans and off-balance sheet instruments.
The Stage 3 allowance for loan losses decreased
$124 million, or 7%, reflecting a decrease in
the Canadian commercial lending portfolio, and
the impact of
foreign exchange, partially offset by an increase
in the Wholesale Banking portfolio.
The Stage 1 and Stage 2 allowance for loan losses
increased $127 million, or
2%, largely reflecting reserve build related
to elevated uncertainty associated with
policy and trade, partially offset by the impact
of foreign exchange. The
allowance change included a decrease of $15
million attributable to the retailer program
partners’ share of the U.S. strategic cards portfolio.
Forward-looking information, including
macroeconomic variables deemed to be
predictive of expected credit losses (ECLs)
based on the Bank’s experience, is
used to determine ECL scenarios and associated
probability weights to determine the probability-weighted
ECLs. Each quarter, all base forecast macroeconomic
variables are refreshed, resulting in new upside
and downside macroeconomic scenarios.
The probability weightings assigned
to each ECL scenario are also
reviewed each quarter and updated as required,
as part of the Bank’s ECL governance process.
As a result of periodic reviews and quarterly updates,
the
allowance for credit losses may be revised
to reflect updates in loss estimates based on
the Bank’s recent loss experience and its forward-looking
views. The Bank
periodically reviews the methodology and
has performed certain additional quantitative
and qualitative portfolio and loan level
assessments of significant increase
in credit risk. Refer to Note 3 and Note 6 of
the Bank’s first quarter 2026
Interim Consolidated Financial Statements
for further details on forward-looking
information.
The probability-weighted allowance for
credit losses reflects the Bank’s forward-looking
views.
To
the extent that certain anticipated effects cannot
be fully
incorporated into quantitative models, management
continues to exercise expert credit judgment
in determining the amount of ECLs, including
for risks related to
elevated uncertainty associated with policy and
trade, and such adjustments will be updated
as appropriate in future quarters as additional
information becomes
available. Refer to Note 6 of the Bank’s first quarter
2026 Interim Consolidated Financial
Statements for additional details.
The Bank calculates allowances for ECLs
on debt securities measured at amortized
cost and FVOCI. The Bank has $358 billion
in such debt securities,
all of
which are performing (Stage 1 and 2) and none
are impaired (Stage 3). The allowance
for credit losses was $2 million for debt
securities at amortized cost (DSAC)
and $2 million for debt securities at FVOCI,
for a total of $4 million, flat, compared
with the first quarter last year.
Quarterly comparison – Q1 2026 vs. Q4 2025
Gross impaired loans increased $174 million,
or 3%, compared with the prior quarter, largely reflected
in the U.S. commercial and Canadian
consumer lending
portfolios, partially offset by lower impairments
in Canadian commercial, and the impact
of foreign exchange. Impaired loans net
of allowance increased
$68 million, or 2%, compared with the prior
quarter.
The allowance for credit losses of
$9,601 million as at January 31, 2026
was comprised of Stage 3 allowance for impaired
loans of $1,700 million, Stage 2
allowance of $4,705 million and Stage 1 allowance
of $3,192 million, and the allowance for debt
securities of $4 million. The Stage 1 and 2 allowances
are for
performing loans and off-balance sheet instruments.
The Stage 3 allowance for loan losses increased
$96 million, or 6%, compared with the prior
quarter,
reflecting credit migration in the Wholesale
and U.S. commercial lending portfolios. The
Stage 1 and Stage 2 allowance for loan losses
decreased $240 million, or
3%, compared with the prior quarter, reflective of the impact
of foreign exchange, migration of reserves
from performing to impaired in the Wholesale
and U.S.
commercial portfolios, and an improvement
in the macroeconomic forecasts.
The allowance for debt securities remained
unchanged, compared to the prior quarter.
For further details on loans, impaired loans,
allowance for credit losses,
and on the Bank’s use of forward-looking information
and macroeconomic variables in
determining its allowance for credit losses,
refer to Note 6 of the Bank’s first quarter 2026
Interim Consolidated Financial Statements.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 24
TABLE 18: CHANGES IN GROSS IMPAIRED LOANS AND ACCEPTANCES
1
(millions of Canadian dollars)
For the three months ended
January 31
October 31
January 31
2026
2025
2025
Personal, Business, and Government
Loans
Impaired loans as at beginning of period
$
5,420
$
5,334
$
4,949
Classified as impaired during the period
2,579
2,177
2,432
Transferred to performing during the period
(297)
(329)
(327)
Net repayments
(569)
(573)
(532)
Disposals of loans
(240)
–
(47)
Amounts written off
(1,210)
(1,221)
(1,144)
Exchange and other movements
(89)
32
122
Impaired loans as at end of period
$
5,594
$
5,420
$
5,453
1
Includes loans that are measured at FVOCI.
TABLE 19: ALLOWANCE FOR CREDIT LOSSES
(millions of Canadian dollars, except
as noted)
As at
January 31
October 31
January 31
2026
2025
2025
Allowance for loan losses for on-balance
sheet loans
Stage 1 allowance for loan losses
$
2,723
$
2,739
$
2,598
Stage 2 allowance for loan losses
4,150
4,362
4,239
Stage 3 allowance for loan losses
1,694
1,588
1,818
Total allowance for loan losses for on-balance sheet loans
1
8,567
8,689
8,655
Allowance for off-balance sheet instruments
Stage 1 allowance for loan losses
469
470
398
Stage 2 allowance for loan losses
555
566
535
Stage 3 allowance for loan losses
6
16
6
Total allowance for off-balance sheet instruments
1,030
1,052
939
Allowance for loan losses
9,597
9,741
9,594
Allowance for debt securities
4
4
4
Allowance for credit losses
$
9,601
$
9,745
$
9,598
Impaired loans, net of allowance
2
$
3,900
$
3,832
$
3,635
Net impaired loans as a percentage of net loans
2
0.41
%
0.40
%
0.38
%
Total allowance for credit losses as a percentage of gross loans and acceptances
0.99
1.01
0.99
Provision for (recovery of) credit losses
as a percentage of net average loans and
acceptances
0.43
0.41
0.50
1
Includes allowance for loan losses related to loans that are measured at FVOCI of $1 million as at January 31, 202
6
(October 31, 2025 – nil, January 31, 2025 – $1 million).
2
Credit cards are considered impaired when they are 90 days past due and written off at 180 days past
due.
Real Estate Secured Lending
Retail real estate secured lending includes
mortgages and lines of credit to North American
consumers to satisfy financing needs including
home purchases and
refinancing. While the Bank retains first lien
on the majority of properties held as security, there is a small
portion of loans with second liens, but
most of these are
behind a TD mortgage or home equity line of
credit (HELOC) that is in first position. In Canada,
credit policies are designed so that the
combined exposure of all
uninsured facilities on one property does not
exceed 80% of the collateral value at origination.
Lending at a higher loan-to-value ratio
is permitted by legislation but
requires default insurance. This insurance is
contractual coverage for the life of eligible
facilities and protects the Bank’s real estate
secured lending portfolio
against potential losses caused by borrowers’
default. The Bank may also purchase default
insurance on lower loan-to-value ratio loans.
The insurance is provided
by either government-backed entities or
approved private mortgage insurers.
In the U.S., for residential mortgage originations,
mortgage insurance is usually
obtained from either government-backed
entities or approved private mortgage insurers
when the loan-to-value exceeds 80% of
the collateral value at origination.
The Bank regularly performs stress tests
on its real estate lending portfolio as part
of its overall stress testing program. This is
done with a view to determine the
extent to which the portfolio would be vulnerable
to a severe downturn in economic conditions.
The effect of severe changes in house prices,
interest rates, and
unemployment levels are among the factors
considered when assessing the impact
on credit losses and the Bank’s overall profitability. A variety of portfolio
segments, including dwelling type and geographical
regions, are examined during the exercise
to determine whether specific vulnerabilities exist.
TABLE 20: CANADIAN REAL ESTATE SECURED LENDING
1
(millions of Canadian dollars)
As at
Amortizing
Non-amortizing
Total
Residential
Home equity
Total amortizing real
Home equity
mortgages
lines of credit
estate secured lending
lines of credit
January 31, 2026
Total
$
261,940
$
118,919
$
380,859
$
37,502
$
418,361
October 31, 2025
Total
$
267,469
$
110,829
$
378,298
$
37,098
$
415,396
1
Excludes loans classified as trading as the Bank intends to sell the loans immediately or in the near term, and loans
designated at FVTPL for which no allowance is recorded.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 25
TABLE 21: REAL ESTATE
SECURED LENDING
1,2
(millions of Canadian dollars, except as noted)
As at
Residential mortgages
Home equity lines of credit
Total
Insured
3
Uninsured
Insured
3
Uninsured
Insured
3
Uninsured
January 31, 2026
Canada
Atlantic provinces
$
2,330
0.9
%
$
4,989
1.9
%
$
134
0.1
%
$
3,030
1.9
%
$
2,464
0.6
%
$
8,019
1.9
%
British Columbia
4
7,708
2.9
45,972
17.6
682
0.4
30,447
19.5
8,390
2.0
76,419
18.3
Ontario
4
21,340
8.1
122,029
46.6
2,330
1.5
85,351
54.6
23,670
5.6
207,380
49.6
Prairies
4
15,978
6.1
22,431
8.6
1,277
0.8
16,809
10.7
17,255
4.1
39,240
9.4
Québec
5,739
2.2
13,424
5.1
419
0.3
15,942
10.2
6,158
1.5
29,366
7.0
Total Canada
53,095
20.2
%
208,845
79.8
%
4,842
3.1
%
151,579
96.9
%
57,937
13.8
%
360,424
86.2
%
United States
1,497
44,714
–
12,278
1,497
56,992
Total
$
54,592
$
253,559
$
4,842
$
163,857
$
59,434
$
417,416
October 31, 2025
Canada
Atlantic provinces
$
2,377
0.9
%
$
5,038
1.9
%
$
139
0.1
%
$
2,833
1.9
%
$
2,516
0.6
%
$
7,871
1.9
%
British Columbia
4
7,849
2.9
47,101
17.6
708
0.5
28,551
19.3
8,557
2.1
75,652
18.2
Ontario
4
21,505
8.1
124,702
46.6
2,412
1.6
80,826
54.7
23,917
5.7
205,528
49.5
Prairies
4
16,350
6.1
22,746
8.5
1,320
0.9
15,738
10.6
17,670
4.3
38,484
9.3
Québec
5,933
2.2
13,868
5.2
433
0.3
14,967
10.1
6,366
1.5
28,835
6.9
Total Canada
54,014
20.2
%
213,455
79.8
%
5,012
3.4
%
142,915
96.6
%
59,026
14.2
%
356,370
85.8
%
United States
1,544
46,050
–
12,481
1,544
58,531
Total
$
55,558
$
259,505
$
5,012
$
155,396
$
60,570
$
414,901
1
Geographic location is based on the address of the property mortgaged.
2
Excludes loans classified
as trading as the Bank intends to sell the loans immediately or in the near term, and loans designated
at FVTPL for which no allowance is recorded.
3
Default insurance is contractual coverage for the life of eligible facilities whereby the Bank’s exposure
to real estate secured lending, all or in part, is protected against potential losses
caused by borrower default. It is provided by either government-backed entities or other approved private mortgage
insurers.
4
The territories are included as follows: Yukon is included in British Columbia; Nunavut
is included in Ontario; and the Northwest Territories
is included in the Prairies region.
The following table provides a summary
of the period over which the Bank’s residential
mortgages would be fully repaid based on
the amount of the most recent
payment received. All figures are calculated
based on current customer payment amounts,
including voluntary payments larger than
the original contractual
amounts and/or other voluntary prepayments.
The most recent customer payment amount
may exceed the original contractual amount
due.
Balances with a remaining amortization longer
than 30 years primarily reflect Canadian
variable rate mortgages where prior interest
rate increases relative to
current customer payment levels have resulted
in a longer current amortization period.
At renewal, the amortization period for
Canadian mortgages reverts to the
remaining contractual amortization, which
may require increased payments.
TABLE 22: RESIDENTIAL MORTGAGES BY REMAINING
AMORTIZATION
1,2
As at
<=5
>5 – 10
>10 – 15
>15 – 20
>20 – 25
>25 – 30
>30 – 35
>35
years
years
years
years
years
years
years
years
Total
January 31, 2026
Canada
0.8
%
3.0
%
8.5
%
19.9
%
31.8
%
30.4
%
1.2
%
4.4
%
100.0
%
United States
2.6
1.7
3.5
9.1
26.6
55.3
0.6
0.6
100.0
Total
1.1
%
2.8
%
7.7
%
18.3
%
31.0
%
34.2
%
1.1
%
3.8
%
100.0
%
October 31, 2025
Canada
0.8
%
2.9
%
8.3
%
20.0
%
31.9
%
30.2
%
1.2
%
4.7
%
100.0
%
United States
2.6
1.6
3.5
9.0
24.1
57.8
0.8
0.6
100.0
Total
1.1
%
2.7
%
7.5
%
18.3
%
30.8
%
34.5
%
1.1
%
4.0
%
100.0
%
1
Excludes loans classified as trading as the Bank intends to sell the loans immediately or in the near term, and loans
designated at FVTPL for which no allowance is recorded.
2
Percentage based on outstanding balance.
TABLE 23: UNINSURED AVERAGE LOAN-TO-VALUE – Newly Originated and Newly Acquired
1,2,3
For the three months ended
Residential
Home equity
Residential
Home equity
mortgages
lines of credit
4,5
Total
mortgages
lines of credit
4,5
Total
January 31, 2026
October 31, 2025
Canada
Atlantic provinces
69
%
69
%
69
%
70
%
69
%
69
%
British Columbia
6
68
66
66
66
66
66
Ontario
6
68
68
68
68
67
67
Prairies
6
72
72
72
72
72
72
Québec
68
71
70
69
71
71
Total Canada
68
68
68
68
68
68
United States
69
57
64
68
58
64
Total
69
%
68
%
68
%
68
%
68
%
68
%
1
Geographic location is based on the address of the property mortgaged.
2
Excludes loans classified as trading as the Bank intends to sell the loans immediately or in the near term, and loans
designated at FVTPL for which no allowance is recorded.
3
Based on house price at origination.
4
HELOC loan-to-value includes first position collateral mortgage if applicable.
5
HELOC fixed rate advantage option is included in loan-to-value calculation.
6
The territories are included as follows: Yukon is included in British Columbia; Nunavut
is included in Ontario; and the Northwest Territories
is included in the Prairies region.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 26
Sovereign Risk
The table below provides a summary of
the Bank’s direct credit exposures
outside of Canada and the U.S. (Europe excludes
United Kingdom).
TABLE 24: Total Net Exposure by Region and Counterparty
(millions of Canadian dollars)
As at
Loans and commitments
1
Derivatives, repos, and securities lending
2
Trading and investment portfolio
3
Total
Corporate
Sovereign
Financial
Total
Corporate
Sovereign
Financial
Total
Corporate
Sovereign
Financial
Total
Exposure
4
January 31, 2026
Region
Europe
$
8,951
$
8
$
5,082
$
14,041
$
6,438
$
1,434
$
9,210
$
17,082
$
1,132
$
26,083
$
2,182
$
29,397
$
60,520
United Kingdom
7,031
2,688
2,396
12,115
2,748
1,504
10,925
15,177
263
1,105
448
1,816
29,108
Asia
140
21
2,566
2,727
517
956
3,909
5,382
120
8,397
1,988
10,505
18,614
Other
5
343
129
686
1,158
909
569
2,298
3,776
110
392
1,952
2,454
7,388
Total
$
16,465
$
2,846
$
10,730
$
30,041
$
10,612
$
4,463
$
26,342
$
41,417
$
1,625
$
35,977
$
6,570
$
44,172
$
115,630
October 31, 2025
Region
Europe
$
8,895
$
8
$
5,019
$
13,922
$
5,331
$
1,359
$
9,647
$
16,337
$
1,116
$
25,876
$
1,982
$
28,974
$
59,233
United Kingdom
6,731
2,577
2,483
11,791
3,199
1,537
12,237
16,973
270
176
661
1,107
29,871
Asia
182
23
2,527
2,732
241
538
3,795
4,574
138
8,346
1,829
10,313
17,619
Other
5
227
–
690
917
705
410
2,353
3,468
110
216
1,967
2,293
6,678
Total
$
16,035
$
2,608
$
10,719
$
29,362
$
9,476
$
3,844
$
28,032
$
41,352
$
1,634
$
34,614
$
6,439
$
42,687
$
113,401
1
Exposures, including interest-bearing deposits with banks, are presented net of impairment charges where applicable.
2
Exposures are calculated on a fair value basis and presented net of collateral. Derivatives are presented as net
exposures where there is an International Swaps and Derivatives
Association master netting agreement.
3
Trading exposures are net of eligible short positions.
4
In addition to the exposures identified above, the Bank also has $29.3 billion (October 31, 2025 – $30.3 billion)
of exposure to supranational entities.
5
Other regional exposure largely attributable to Australia.
CAPITAL POSITION
REGULATORY CAPITAL
Capital requirements established by the Basel
Committee on Banking Supervision (BCBS)
are commonly referred to as Basel
III. Under Basel III,
Total Capital consists of three components, namely CET1, Additional Tier 1, and Tier 2 Capital.
Risk sensitive regulatory capital ratios are
calculated by dividing
CET1, Tier 1, and Total Capital by risk-weighted assets (RWA), inclusive of any minimum requirements
outlined under the regulatory floor. Basel III also
introduced a non-risk sensitive leverage
ratio to act as a supplementary measure
to the risk-sensitive capital requirements.
The leverage ratio is calculated by
dividing Tier 1 Capital by leverage exposure which is
primarily comprised of on-balance sheet
assets with adjustments made to derivative
and securities financing
transaction exposures, and credit equivalent amounts
of off-balance sheet exposures. TD manages its
regulatory capital in accordance with
OSFI’s
implementation of the Basel III Capital
Framework.
OSFI’s Capital Requirements under Basel III
OSFI’s CAR and LR guidelines detail how the
Basel III capital rules apply to Canadian banks.
The Domestic Stability Buffer (DSB) level increased
from 3% to 3.5% as of November 1,
2023, and has remained stable since. Currently, the DSB can range
from
0 to 4%, with the effective level adjusted by OSFI
in response to developments in Canada’s
financial system and the broader economy.
OSFI has implemented the Basel III reforms
with adjustments to make them suitable
for domestic implementation. The Basel III reforms
impact the calculation of
credit risk, market risk and operational risk
for Canadian banks, as well as amend
the LR Guideline to include a requirement for
domestic systemically important
banks (D-SIBs) to hold a leverage ratio
buffer of 0.50% in addition to the regulatory minimum
requirement of 3.0%. The LR buffer requirement
also applies to the
TLAC leverage ratio.
On November 1, 2023, the standardized
capital floor transitioned to 67.5% of RWA from the previous 65%
of RWA. OSFI has stated that the floor will remain at
67.5% until further notice.
The Bank has implemented OSFI’s Parental Stand-Alone
(Solo) Total Loss Absorbing Capacity (TLAC) Framework for D-SIBs, which
establishes a risk-based
measure intended to ensure that a non-viable
D-SIB has sufficient loss absorbing capacity on a
stand-alone, legal entity basis to support its
resolution. The Bank is
compliant with the requirements set out in this
framework.
The table below summarizes OSFI’s published
regulatory minimum capital targets
as at January 31, 2026.
REGULATORY
CAPITAL AND TLAC
TARGET RATIOS
Capital
Pillar 1
Pillar 1 & 2
Conservation
D-SIB / G-SIB
Regulatory
Regulatory
Minimum
Buffer
Surcharge
1
Target
2
DSB
Target
CET1
4.5
%
2.5
%
1.0
%
8.0
%
3.5
%
11.5
%
Tier 1
6.0
2.5
1.0
9.5
3.5
13.0
Total Capital
8.0
2.5
1.0
11.5
3.5
15.0
Leverage
3.0
n/a
3
0.5
3.5
n/a
3.5
TLAC
18.0
2.5
1.0
21.5
3.5
25.0
TLAC Leverage
6.75
n/a
0.50
7.25
n/a
7.25
1
The higher of the D-SIB and G-SIB surcharge applies to risk weighted capital. The D-SIB surcharge is currently equivalent
to the Bank’s 1% G-SIB additional common equity requirement
for risk weighted capital. The G-SIB surcharge may increase above 1%,
to a maximum of 4%, if the Bank’s G-SIB score increases above certain thresholds.
OSFI’s LR Guideline includes
a requirement for D-SIBs to hold a leverage ratio buffer set at 50% of a D-SIB’s higher
loss absorbency risk-weighted requirements, effectively 0.50%. This buffer also
applies to the TLAC
Leverage ratio.
2
The Bank’s countercyclical buffer requirement is 0% as of January 31,
2026.
3
Not applicable.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 27
Global Systemically Important Banks
Disclosures
The Financial Stability Board (FSB), in
consultation with the BCBS and national authorities,
identifies G-SIBs. The G-SIB assessment
methodology is based on the
submissions of the largest global banks.
Thirteen indicators are used in the G-SIB
assessment methodology to determine
systemic importance. The score
for a
particular indicator is calculated by dividing
the individual bank value by the aggregate
amount for the indicator summed across all
banks included in the
assessment. Accordingly, an
individual bank’s ranking is reliant on
the results and submissions of other global
banks.
The Bank is required to publish the thirteen
indicators used in the G-SIB indicator-based
assessment framework. Public disclosure
of financial year-end data is
required annually, no later than the date of a bank’s
first quarter public disclosure of shareholder
financial data in the following year.
Public communications on G-SIB status are
issued annually each November. On November
22, 2019, the Bank was designated as
a G-SIB by the FSB. The Bank
continued to maintain its G-SIB status when
the FSB published the 2025 list of G-SIBs on
November 27, 2025.
As a result of this designation, the Bank is
subject
to an additional loss absorbency requirement
(CET1 as a percentage of RWA) of 1% under
applicable FSB member authority requirements.
The Bank’s G-SIB
designation has no additional impact on the
Bank’s minimum CET1 regulatory requirements,
as the G-SIB surcharge is consistent with
the D-SIB requirement set
out by OSFI. The G-SIB surcharge may increase
above 1% if the Bank’s G-SIB score increases
above certain thresholds to a maximum
of 4.5%.
As a result of the Bank’s G-SIB designation,
the U.S. Federal Reserve requires
TD Group US Holding LLC (TDGUS), as
TD’s U.S. Intermediate Holding
Company (IHC), to maintain a minimum amount
of TLAC and long-term debt.
The indicator-based measurement approach,
currently in effect, divides the thirteen indicators
into five categories, with each category
yielding a 20% weight to a
bank’s total score on the G-SIB scale.
The following table provides the results of
the thirteen indicators for the Bank. The
increase in Over-the-Counter (OTC) derivatives
was primarily driven by
higher interest rate swap activity. The increase
in trading and available-for-sale (AFS)
securities reflects higher fixed income and
equity exposures. All other
changes in the indicators from the prior
year primarily reflect normal business activities
of the Bank.
TABLE 25: G-SIB INDICATORS
1
(millions of Canadian dollars)
As at
October 31, 2025
October 31, 2024
Category (and weighting)
Individual Indicator
Cross-jurisdictional activity (20%)
Cross-jurisdictional claims
$
1,059,153
$
1,100,768
Cross-jurisdictional liabilities
1,032,848
1,042,951
Size (20%)
Total exposures as defined for use in the Basel III leverage ratio
2,285,174
2,228,986
Interconnectedness (20%)
Intra-financial system assets
136,828
107,793
Intra-financial system liabilities
49,036
36,477
Securities outstanding
533,883
487,199
Substitutability/financial institution
Assets under custody
824,907
689,698
infrastructure (20%)
Payments activity
65,326,873
61,946,928
Underwritten transactions in debt and equity
markets
216,358
211,859
Trading Volume (includes the two sub indicators)
– Trading volume fixed income sub indicator
6,824,850
12,900,561
– Trading volume equities and other securities sub indicator
5,068,353
2,855,130
Complexity (20%)
Notional amount of OTC derivatives
28,138,484
23,945,530
Trading and other securities
2
111,132
72,514
Level 3 assets
3,581
4,663
1
The G-SIB indicators are prepared based on the methodology prescribed in BCBS guidelines published and
disclosed in accordance with OSFI’s Advisory on G-SIBs – Public Disclosure
Requirements. Given the Bank was designated as a G-SIB by the FSB on November 22, 2019, additional public
disclosures on these indicators are required. Refer to the Bank’s
Regulatory Capital Disclosures at www.td.com/investor-relations/ir-homepage/regulatory-disclosures/g-sib/disclosures.jsp
for these additional disclosures on the 2025 G-SIB indicators.
The Bank is required to submit its G-SIB indicators to OSFI and BCBS for review following the date of this report.
In the event that one or both regulators provide comments to the Bank
regarding its submission that would result in changes to the G-SIB indicators listed in the table above, the Bank
will publish such revised G-SIB indicators on its website.
2
Includes trading securities, securities designated at FVTPL,
and securities at FVOCI.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 28
The following table provides details of the
Bank’s regulatory capital position.
TABLE 26: CAPITAL STRUCTURE AND RATIOS – Basel III
(millions of Canadian dollars, except
as noted)
As at
January 31
October 31
January 31
2026
2025
2025
Common Equity Tier 1 Capital
Common shares plus related contributed
surplus
$
24,855
$
25,010
$
25,679
Retained earnings
78,253
78,320
71,718
Accumulated other comprehensive income
10,868
12,874
10,520
Common Equity Tier 1 Capital before regulatory
adjustments
113,976
116,204
107,917
Common Equity Tier 1 Capital regulatory adjustments
Prudential valuation adjustments
(175)
(165)
–
Goodwill (net of related tax liability)
(18,248)
(18,753)
(19,359)
Intangibles (net of related tax liability)
(3,351)
(3,316)
(3,041)
Deferred tax assets excluding those arising
from temporary differences
(156)
(202)
(284)
Cash flow hedge reserve
1,304
867
2,859
Shortfall of provisions to expected losses
–
–
–
Gains and losses due to changes in own
credit risk on fair valued liabilities
(127)
(166)
(191)
Defined benefit pension fund net assets (net
of related tax liability)
(760)
(811)
(733)
Investment in own shares
(24)
(9)
(57)
Non-significant investments in the capital of
banking, financial, and insurance entities,
net of eligible
short positions (amount above 10% threshold)
–
–
(1,890)
Significant investments in the common
stock of banking, financial, and insurance
entities
that are outside the scope of regulatory
consolidation, net of eligible short positions
(amount above 10% threshold)
–
–
–
Equity investments in funds subject to
the fall-back approach
(52)
(90)
(35)
Crypto-asset deduction
(17)
–
–
Other deductions or regulatory adjustments
to CET1 as determined by OSFI
22
20
18
Total regulatory adjustments to Common Equity Tier 1 Capital
(21,584)
(22,625)
(22,713)
Common Equity Tier 1 Capital
92,392
93,579
85,204
Additional Tier 1 Capital instruments
Directly issued qualifying Additional Tier 1 instruments
plus stock surplus
11,620
11,623
11,087
Additional Tier 1 Capital instruments before
regulatory adjustments
11,620
11,623
11,087
Additional Tier 1 Capital instruments regulatory
adjustments
Non-significant investments in the capital of
banking, financial, and insurance entities,
net of eligible
short positions (amount above 10% threshold)
–
–
(2)
Significant investments in the capital of banking,
financial, and insurance entities that are
outside
the scope of regulatory consolidation, net of
eligible short positions
(700)
(700)
(700)
Total regulatory adjustments to Additional Tier 1 Capital
(700)
(700)
(702)
Additional Tier 1 Capital
10,920
10,923
10,385
Tier 1 Capital
103,312
104,502
95,589
Tier 2 Capital instruments and provisions
Directly issued qualifying Tier 2 instruments plus related
stock surplus
10,642
10,733
13,471
Collective allowances
1,141
1,661
1,424
Tier 2 Capital before regulatory adjustments
11,783
12,394
14,895
Tier 2 regulatory adjustments
Investments in own Tier 2 instruments
–
–
–
Non-significant investments in the capital of
banking, financial, and insurance entities,
net of eligible
short positions (amount above 10% threshold)
1
–
–
(226)
Non-significant investments in the other
TLAC-eligible instruments issued by
G-SIBs and Canadian
D-SIBs, where the institution does not own
more than 10% of the issued common
share capital
of the entity: amount previously designated
for the 5% threshold but that no longer
meets the
conditions
(30)
(30)
(20)
Significant investments in the capital of banking,
financial, and insurance entities that are
outside
the scope of regulatory consolidation, net of
eligible short positions
–
–
–
Total regulatory adjustments to Tier 2 Capital
(30)
(30)
(246)
Tier 2 Capital
11,753
12,364
14,649
Total Capital
$
115,065
$
116,866
$
110,238
Risk-weighted assets
$
635,191
$
636,424
$
649,043
Capital Ratios and Multiples
Common Equity Tier 1 Capital (as percentage of risk-weighted
assets)
14.5
%
14.7
%
13.1
%
Tier 1 Capital (as percentage of risk-weighted assets)
16.3
16.4
14.7
Total Capital (as percentage of risk-weighted assets)
18.1
18.4
17.0
Leverage ratio
2
4.5
4.6
4.2
1
Includes other TLAC-eligible instruments issued by G-SIBs and Canadian D-SIBs that are outside the scope of
regulatory consolidation, where the institution does not own more than
10% of the issued common share capital of the entity.
2
The Leverage ratio is calculated as Tier 1 Capital divided by leverage exposure,
as defined in the “Regulatory Capital” section of this document.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 29
16
17
As at January 31, 2026, the Bank’s CET1, Tier 1, and Total Capital ratios were 14.5%, 16.3%,
and 18.1%, respectively. The decrease in the Bank’s CET1 Capital
ratio from 14.7% as at October 31, 2025 was
primarily driven by common shares repurchased
for cancellation and growth in RWA, partially offset by earnings net
of dividends, credit risk model updates, and
unrealized gains on FVOCI securities.
The Bank expects to reach a CET1 ratio
of approximately 13% by
October 31, 2027
,
.
As at January 31, 2026, the Bank’s leverage ratio
was 4.5%. Compared with the Bank’s leverage ratio
of 4.6% at October 31, 2025, the decrease
was primarily
attributable to common shares repurchased
for cancellation, partially offset by earnings net of dividends
and leverage exposure growth across
various segments.
Future Regulatory Capital Developments
Future regulatory capital developments
were described in the “Future Regulatory
Capital Developments” section of the Bank’s
2025 MD&A.
TABLE 27: EQUITY AND OTHER SECURITIES
1
(thousands of shares/units and millions of
Canadian dollars, except as noted)
As at
January 31, 2026
October 31, 2025
Number of
Number of
shares/units
Amount
shares/units
Amount
Common shares
Common shares outstanding
1,671,278
$
24,551
1,689,496
$
24,727
Treasury – common shares
(41)
(5)
–
–
Total common shares
1,671,237
$
24,546
1,689,496
$
24,727
Stock options
Vested
6,248
5,160
Non-vested
8,355
9,027
Preferred shares – Class A
Series 1
20,000
$
500
20,000
$
500
Series 16
14,000
350
14,000
350
Series 18
14,000
350
14,000
350
Series 27
850
850
850
850
Series 28
800
800
800
800
49,650
$
2,850
49,650
$
2,850
Other equity instruments
2,3
Limited Recourse Capital Notes – Series 1
1,750
1,750
1,750
1,750
Limited Recourse Capital Notes – Series 2
1,500
1,500
1,500
1,500
Limited Recourse Capital Notes – Series 3
4
1,750
2,403
1,750
2,403
Limited Recourse Capital Notes – Series 4
4
750
1,023
750
1,023
Limited Recourse Capital Notes – Series 5
750
750
750
750
Limited Recourse Capital Notes – Series 6
4
750
1,037
750
1,037
Perpetual Subordinated Capital Notes – Series
2023-9
5
1
312
1
312
56,901
$
11,625
56,901
$
11,625
Treasury – preferred shares and other equity instruments
(11)
(11)
(29)
(4)
Total preferred shares and other equity instruments
56,890
$
11,614
56,872
$
11,621
1
For further details, including the conversion and exchange features, distributions, and significant terms and conditions,
refer to Note 19 of the Bank’s 2025 Consolidated Financial
Statements.
2
For other equity instruments, the number of shares/units represents the number of notes issued.
3
Refer to the “Preferred Shares and Other Equity Instruments – Significant Terms
and Conditions” table in Note 19 of the Bank’s 2025 Consolidated Financial Statements
for further
details.
4
For LRCNs – Series 3, 4, and 6, the amount represents the Canadian dollar equivalent of the U.S. dollar notional
amount.
5
For Perpetual Subordinated Capital Notes (AT1), the amount
represents the Canadian dollar equivalent of the Singapore dollar notional amount.
DIVIDENDS
On February 25, 2026, the Board approved
a dividend in an amount of one dollar and eight
cents ($1.08) per fully paid common share in
the capital stock of the
Bank for the quarter ending April 30, 2026, payable
on and after April 30, 2026, to shareholders
of record at the close of business on April
9, 2026. The Bank has a
semi-annual dividend review cycle to support
the alignment of shareholder return with
earnings growth.
DIVIDEND REINVESTMENT PLAN
The Bank offers a Dividend Reinvestment Plan
(DRIP) for its common shareholders.
Participation in the plan is optional and
under the terms of the plan, cash
dividends on common shares are used
to purchase additional common shares. At
the option of the Bank, the common shares
may be issued from treasury at an
average market price based on the last five
trading days before the date of the dividend
payment, with a discount of between
0% to 5% at the Bank’s discretion or
purchased from the open market at market
prices.
During the three months ended January 31,
2026, the Bank satisfied the DRIP requirements
through open market common share purchases
(three months
ended January 31, 2025 – the Bank satisfied
the DRIP requirements through common
shares issued from treasury with no discount).
NORMAL COURSE ISSUER BID
On February 24, 2025, the Bank announced
that the Toronto Stock Exchange (TSX) and OSFI had approved the Bank’s normal
course issuer bid (2025 NCIB) to
repurchase for cancellation up to $8 billion
of its common shares, not to exceed
100 million common shares. The Bank
completed $8 billion in repurchases
and
terminated the 2025 NCIB in January 2026.
From the commencement of the 2025
NCIB on March 3, 2025, to its completion
and termination on January 15, 2026,
the Bank repurchased 80.2 million shares
under the program, at an average price of $99.74
per share for a total amount of $8.0
billion.
On January 16, 2026, the Bank announced
that the TSX and OSFI have approved
the Bank’s new normal course issuer bid (2026
NCIB) to repurchase for
cancellation up to $7 billion of its common
shares, not to exceed 61 million common
shares. The 2026 NCIB commenced on
January 20, 2026, and will terminate
on (A) the earliest to occur of: (i) January 15,
2027; (ii) the date on which the aggregate
purchase cost of common shares purchased
equals $7 billion; and (iii) the
16
The Bank’s expectations for financial targets are based on forward-looking assumptions that have inherent
risk and uncertainties. Results may vary depending on actual economic
conditions, including the level of unemployment, interest rates, and economic growth or contraction, the operating
environment, including regulatory requirements, political environment,
and competitive landscape, and the Bank’s assumptions on future business performance, including
credit conditions and performance, inclusive of policy and trade uncertainty and
borrower or industry specific credit factors and conditions, and foreign exchange impact. These assumptions are
subject to inherent uncertainties and may vary based on factors outside
the Bank’s control, including those set out at the beginning of this document in the “Caution Regarding
Forward-Looking Statements” section. Refer to the “Risk Factors That May Affect
Future Results” section of the Bank’s 2025 MD&A for additional information about risks and uncertainties
that may impact the Bank’s estimates.
17
Calculated in accordance with the OSFI’s Capital Adequacy Requirements guideline.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 30
date on which the maximum number of
common shares purchasable is reached; or
(B) such earlier date as the Bank may
determine. From the commencement of
the 2026 NCIB on January 20, 2026, to January
31, 2026, the Bank repurchased 3.8 million
shares under the program, at an average price
of $129.06 per share
for a total amount of $0.5 billion.
NON-VIABILITY CONTINGENT CAPITAL PROVISION
If an NVCC trigger event were to occur, for all series of Class
A First Preferred Shares excluding the preferred
shares issued with respect to LRCNs,
the maximum
number of common shares that could be issued,
assuming there are no declared and unpaid
dividends on the respective series of preferred
shares at the time of
conversion, would be 0.6 billion in aggregate.
The LRCNs, by virtue of the recourse to the
preferred shares held in the Limited Recourse
Trust, include NVCC provisions. For LRCNs, if an NVCC
trigger were
to occur, the maximum number of common shares that could
be issued, assuming there are no declared
and unpaid dividends on the preferred
shares series
issued in connection with such LRCNs,
would be 1.7 billion in aggregate.
For NVCC subordinated notes and debentures
(including Additional Tier 1 Perpetual Notes), if an
NVCC trigger event were to occur, the maximum number
of
common shares that could be issued, assuming
there is no accrued and unpaid interest
on the respective subordinated notes and debentures,
would be 3.3 billion
in aggregate.
RISK FACTORS AND
MANAGEMENT
Risk Factors That May Affect Future Results
In addition to the risks described in the “Managing
Risk” section of the Bank’s 2025 MD&A and this
Report, there are numerous other risk factors,
many of which
are beyond the Bank’s control and the effects of
which can be difficult to predict, that could
cause the Bank’s results to differ significantly from the
Bank’s plans,
objectives, and estimates or could impact
the Bank’s reputation or the sustainability of its
business model. All forward-looking statements,
including those in this
MD&A, are, by their very nature, subject
to inherent risks and uncertainties, general
and specific, which may cause the Bank’s actual
results to differ materially
from the plan, objectives, estimates or expectations
expressed in the forward-looking statements.
Some of these factors are discussed
in the “Risk Factors and
Management” section of the 2025
MD&A and in the “Managing Risk” section
of this document, and others are noted in
the “Caution Regarding Forward-Looking
Statements” section of this document.
The Bank has supplemented the following Risk
Factors to reflect developments in the
external environment.
Introduction of New and Changes to
Current Laws, Rules and Regulations
Further to the risks outlined in the Introduction
of New and Changes to Current Laws,
Rules and Regulations section of the Bank’s 2025 MD&A,
the federal
government is implementing AML related
requirements as part of its mandated
five-year review of Canada’s AML regime. In addition,
further changes are
proposed under Bill C-2, the Strong Borders
Act. Those portions that provide FINTRAC
with enhanced supervisory and enforcement
tools and powers, including
the ability to impose larger financial penalties,
have been included in Bill C-12, Strengthening
Canada’s Immigration System and Borders Act,
which is currently
before the Canadian Senate. Many of the provisions
are anticipated to have or will have
short coming into force dates once finalized.
Further changes may be
required following the completion of the
mutual evaluation of Canada’s AML regime by
the Financial Action Task Force (FATF), which is currently underway and
anticipated to be completed in mid-2026.
The pace of these changes, the potentially
short timelines to implement and the evolving
risks could result in increased
costs and risks that may negatively impact
the Bank’s businesses, operations, and results.
Model Risk
Further to the model risks outlined in the
Bank’s 2025 MD&A, OSFI released its final Guideline
E-23 – Model Risk Management on September
11, 2025, which
becomes effective on May 1, 2027. This guideline
sets out OSFI’s expectations for effectively managing
risks associated with the use of
traditional models as well
as emerging technologies such as artificial intelligence
and machine learning. TD has completed
its assessment of the requirements of
the guideline and does not
anticipate any issues in complying with
the requirements by the effective date.
MANAGING RISK
EXECUTIVE SUMMARY
Growing profitability in financial results based
on balanced revenue, expense and capital
growth services involves selectively taking
and managing risks within the
Bank’s risk appetite. The Bank’s goal is to earn a
stable and sustainable rate of return for
every dollar of risk it takes, while putting
significant emphasis on
investing in its businesses to meet its future
strategic objectives.
The Bank’s businesses and operations are exposed
to a broad number of risks that have been
identified and defined in the Enterprise Risk
Framework. The
Bank’s tolerance to those risks is defined in
the Enterprise Risk Appetite which has been
developed within a comprehensive framework
that takes into
consideration current conditions in which
the Bank operates and the impact that emerging
risks will have on TD’s strategy and risk profile. The
Bank’s risk appetite
states that it takes risks required to build its
business, but only if those risks: (1)
fit the business strategy and can be understood
and managed; (2) do not expose
the enterprise to any significant single loss
events; TD does not ‘bet the bank’ on any
single acquisition, business, product or decision;
and (3) do not risk harming
the TD brand. Each business is responsible
for setting and aligning its individual risk
appetites with that of the enterprise
based on a thorough examination of
the
specific risks to which it is exposed.
The Bank considers it critical to regularly
assess its operating environment
and highlight top and emerging risks. These
are risks with a potential to have a
material effect on the Bank and where the attention
of senior leaders is focused due to the potential
magnitude or immediacy of their impact.
Risks are identified, discussed, and actioned
by senior leaders and reported quarterly
to the Risk Committee. Specific plans
to mitigate top and emerging risks
are prepared, monitored, and adjusted as required.
The Bank’s risk governance structure and risk
management approach have not substantially
changed from that described in the Bank’s 2025 MD&A.
Additional
information on risk factors can be found in
this document and the 2025 MD&A under
the heading “Risk Factors and Management”.
For a complete discussion of
the risk governance structure and the risk
management approach, refer to the “Managing
Risk” section in the Bank’s 2025 MD&A.
The shaded sections of this MD&A represent
a discussion relating to market and liquidity
risks and form an integral part of the Interim
Consolidated Financial
Statements for the period ended January 31,
2026.
CREDIT RISK
Gross credit risk exposure, also referred
to as exposure at default (EAD), is the
total amount the Bank is exposed to at the time
of default of a loan and is
measured before counterparty-specific
provisions or write-offs. Gross credit risk exposure
does not reflect the effects of credit risk
mitigation (CRM) and includes
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 31
both on-balance sheet and off-balance sheet exposures.
On-balance sheet exposures consist primarily
of outstanding loans, non-trading securities,
derivatives,
and certain other repo-style transactions.
Off-balance sheet exposures consist primarily
of undrawn commitments, guarantees,
and certain other repo-style
transactions.
Gross credit risk exposures for the two approaches
the Bank uses to measure credit risk
are included in the following table.
TABLE 28: GROSS CREDIT RISK EXPOSURE – Standardized
and Internal Ratings-Based (IRB) Approaches
1
(millions of Canadian dollars)
As at
January 31, 2026
October 31, 2025
Standardized
IRB
Total
Standardized
IRB
Total
Retail
Residential secured
$
5,143
$
555,026
$
560,169
$
5,141
$
552,249
$
557,390
Qualifying revolving retail
854
178,004
178,858
871
177,970
178,841
Other retail
3,957
109,362
113,319
3,660
110,316
113,976
Total retail
9,954
842,392
852,346
9,672
840,535
850,207
Non-retail
Corporate
1,953
818,593
820,546
2,402
758,573
760,975
Sovereign
153
461,017
461,170
175
552,954
553,129
Bank
3,077
204,472
207,549
7,121
180,614
187,735
Total non-retail
5,183
1,484,082
1,489,265
9,698
1,492,141
1,501,839
Gross credit risk exposures
$
15,137
$
2,326,474
$
2,341,611
$
19,370
$
2,332,676
$
2,352,046
1
Gross credit risk exposures represent EAD and are before the effects of CRM. This table excludes securitization,
equity, and certain other credit RWA.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 32
MARKET RISK
Market risk capital is calculated using the Standardized
Approach under Basel III. The Bank
continues to use Value-at-Risk (VaR) as an internal management
metric to monitor and control market risk.
Market Risk Linkage to the Balance Sheet
The following table provides a breakdown of
the Bank’s balance sheet assets and liabilities
exposed to trading and non-trading market
risks. Market risk of assets
and liabilities included in the calculation of VaR and metrics used
for regulatory market risk capital purposes
is classified as trading market risk.
TABLE 29: MARKET RISK LINKAGE TO THE BALANCE SHEET
(millions of Canadian dollars)
As at
January 31, 2026
October 31, 2025
Non-trading market
Balance
Trading
Non-trading
Balance
Trading
Non-trading
risk – primary risk
sheet
market risk
market risk
Other
sheet
market risk
market risk
Other
sensitivity
Assets subject to market risk
Interest-bearing deposits with banks
$
113,672
$
8,060
$
105,612
$
–
$
109,417
$
940
$
108,477
$
–
Interest rate
Trading loans, securities, and other
234,888
230,712
4,176
–
220,136
213,151
6,985
–
Interest rate
Non-trading financial assets at
fair value through profit or loss
8,425
–
8,425
–
7,395
–
7,395
–
Equity,
foreign exchange,
interest rate
Derivatives
83,371
76,501
6,870
–
82,972
72,906
10,066
–
Equity,
foreign exchange,
interest rate
Financial assets designated at
fair value through profit or loss
7,038
–
7,038
–
6,986
–
6,986
–
Interest rate
Financial assets at fair value through
other comprehensive income
127,872
–
127,872
–
126,369
–
126,369
–
Equity,
foreign exchange,
interest rate
Debt securities at amortized cost,
net of allowance for credit losses
234,270
–
234,270
–
240,439
–
240,439
–
Foreign exchange,
interest rate
Securities purchased under
reverse repurchase agreements
222,925
7,406
215,519
–
247,078
7,574
239,504
–
Interest rate
Loans, net of allowance for
loan losses
958,486
–
958,486
–
953,012
–
953,012
–
Interest rate
Other assets
1
1,933
–
1,933
–
2,047
–
2,047
–
Interest rate
Assets not exposed to
market risk
106,426
–
–
106,426
98,707
–
–
98,707
Total Assets
$
2,099,306
$
322,679
$
1,670,201
$
106,426
$
2,094,558
$
294,571
$
1,701,280
$
98,707
Liabilities subject to market risk
Trading deposits
$
42,328
$
30,298
$
12,030
$
–
$
37,882
$
28,955
$
8,927
$
–
Equity, interest rate
Derivatives
83,495
80,573
2,922
–
79,356
74,790
4,566
–
Equity,
foreign exchange,
interest rate
Securitization liabilities at fair value
25,399
25,399
–
–
25,283
25,283
–
–
Interest rate
Financial liabilities designated at
fair value through profit or loss
225,237
3
225,234
–
197,635
3
197,632
–
Interest rate
Deposits
1,245,144
–
1,245,144
–
1,267,104
–
1,267,104
–
Interest rate,
foreign exchange
Obligations related to securities
sold short
41,455
40,223
1,232
–
43,795
42,475
1,320
–
Interest rate
Obligations related to securities sold
under repurchase agreements
213,782
19,785
193,997
–
221,150
13,922
207,228
–
Interest rate
Securitization liabilities at amortized
cost
15,021
–
15,021
–
14,841
–
14,841
–
Interest rate
Subordinated notes and debentures
10,642
–
10,642
–
10,733
–
10,733
–
Interest rate
Other liabilities
1
16,446
–
16,446
–
16,934
–
16,934
–
Equity, interest rate
Liabilities and Equity not
exposed to market risk
180,357
–
–
180,357
179,845
–
–
179,845
Total Liabilities and Equity
$
2,099,306
$
196,281
$
1,722,668
$
180,357
$
2,094,558
$
185,428
$
1,729,285
$
179,845
1
Relates to retirement benefits, insurance, and structured entity liabilities.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 33
-75
-65
-55
-45
-35
-25
-15
-5
5
15
25
35
45
55
65
75
11/3/2025
11/10/2025
11/17/2025
11/24/2025
12/1/2025
12/8/2025
12/15/2025
12/22/2025
12/30/2025
1/7/2026
1/14/2026
1/21/2026
1/28/2026
TOTAL VALUE-AT-RISK
AND TRADING NET REVENUE
(millions of Canadian dollars)
Trading net revenue
Value-at-Risk
Calculating VaR
The Bank computes total VaR on a daily basis by combining the General
Market Risk (GMR) and Idiosyncratic Debt
Specific Risk (IDSR) associated with the
Bank’s trading positions.
GMR is determined by creating a distribution
of potential changes in the market value of
the current portfolio using historical simulation.
The Bank values the
current portfolio using the market price and rate
changes of the most recent
259
trading days for equity, interest rate, foreign exchange, credit, and
commodity
products. GMR is computed as the threshold
level that portfolio losses are not expected
to exceed more than
one
out of every
100
trading days. A
one-day
holding
period is used for GMR calculation.
IDSR measures idiosyncratic (single-name) credit
spread risk for credit exposures in the trading
portfolio using Monte Carlo simulation.
The IDSR model is
based on the historical behaviour of five-year idiosyncratic
credit spreads. Similar to GMR, IDSR is
computed as the threshold level that portfolio
losses are not
expected to exceed more than
one
out of every
100
trading days. IDSR is measured for a
ten-day
holding period.
The following graph discloses daily
one-day
VaR usage and trading net revenue, reported on a TEB,
within Wholesale Banking. Trading net revenue includes
trading income and net interest income related
to positions within the Bank’s market risk capital
trading books. For the first quarter ending January
31, 2026,
there were
3 days
of trading losses and trading net revenue
was positive for
95
% of the trading days, reflecting normal
trading activity. Losses in the quarter did
not exceed VaR on any trading day.
VaR is a valuable risk measure but it should be used in the
context of its limitations, for example:
●
VaR uses historical data to estimate future events, which limits
its forecasting abilities;
●
it does not provide information on losses beyond
the selected confidence level; and
●
it assumes that all positions can be liquidated
during the holding period used for VaR calculation.
The Bank continuously improves its VaR methodologies and incorporates
new risk measures in line with market
conventions, industry best practices, and
regulatory requirements. The change in VaR on December 1, 2025
reflects an improvement in methodology
and not a change in risk-taking.
To mitigate some of the shortcomings of VaR, the Bank uses additional metrics designed for risk
management purposes.
This includes Stress Testing as well
as sensitivities to various market risk factors.
The following table presents the end of quarter, average, high,
and low usage of TD’s VaR metric.
TABLE 30: PORTFOLIO MARKET
RISK MEASURES
(millions of Canadian dollars)
For the three months ended
January 31
October
31
January
31
2026
2025
2025
As at
Average
High
Low
Average
Average
Interest rate risk
$
18.5
$
12.6
$
25.1
$
5.5
$
7.4
$
12.4
Credit spread risk
15.6
14.8
20.1
11.5
20.1
19.8
Equity risk
14.5
16.1
23.7
11.4
13.8
8.3
Foreign exchange risk
5.7
5.1
44.4
1.3
4.8
4.1
Commodity risk
31.0
37.1
65.5
24.4
38.6
6.0
Idiosyncratic debt specific risk
15.3
15.3
17.7
12.7
15.7
19.6
Diversification effect
1
(61.1)
(58.8)
n/m
2
n/m
(54.6)
(41.8)
Total Value
-at-Risk (one-day)
$
39.5
$
42.2
$
66.5
$
28.0
$
45.8
$
28.4
1
The aggregate VaR is less than the sum of the VaR
of the different risk types due to risk offsets resulting from portfolio diversification.
2
Not meaningful. It is not meaningful to compute a diversification effect because the high and low may
occur on different days for different risk types.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 34
Average VaR decreased quarter-over-quarter due to changes in fixed
income positions along with the narrower
credit spreads, partially offset by interest rate
positions.
Validation of VaR Model
The Bank uses a back-testing process
to compare actual profits and losses to VaR to review their consistency
with the statistical results of the VaR model.
Structural (Non-Trading) Interest Rate
Risk
The Bank’s
structural interest rate risk arises from traditional
personal and commercial banking activity
and is generally the result of mismatches between
the
maturities and repricing dates of the Bank’s assets
and liabilities.
The primary measures for managing and
controlling this risk are Economic Value of Shareholders’
Equity (EVE) Sensitivity and Net Interest
Income Sensitivity
(NIIS).
The EVE Sensitivity measures the change in
the net present value of the Bank’s banking
book assets, liabilities, and certain off-balance
sheet items given a
specific interest rate shock. It reflects a measurement
of the potential present value impact on
shareholders’ equity without an assumed
term profile for the
management of the Bank’s own equity and excludes
product margins.
The NIIS measures the NII change over
a twelve-month horizon for a specified
change in interest rates for banking book
assets, liabilities, and certain off-
balance sheet items assuming a constant balance
sheet over the period.
The Bank’s Market Risk policy sets overall limits
on the structural interest rate risk measures.
These limits are periodically reviewed and
approved by the Risk
Committee. In addition to the Board policy limits,
book-level risk limits are set for the
Bank’s management of non-trading interest rate
risk by Risk Management.
Exposures against these limits are routinely
monitored and reported, and breaches of the
Board limits, if any, are escalated to both the Asset Liability and
Capital
Committee (ALCO) and the Risk Committee.
The following table shows the potential before-tax
impact of an immediate and sustained
100 bps increase or decrease in interest rates
on the EVE and NIIS
measures.
TABLE 31: STRUCTURAL INTEREST RATE SENSITIVITY MEASURES
(millions of Canadian dollars)
As at
January 31, 2026
October 31, 2025
January 31, 2025
EVE
NII
EVE
NII
EVE
NII
Sensitivity
1
Sensitivity
1,2
Sensitivity
1
Sensitivity
2
Sensitivity
1
Sensitivity
1,2
Canadian
U.S.
Total
Canadian
U.S.
Total
Total
Total
Total
Total
dollar
3
dollar
dollar
3
dollar
Before-tax impact of
100 bps increase in rates
$
(1,021)
$
(1,500)
$
(2,521)
$
382
$
363
$
745
$
(2,515)
$
790
$
(2,573)
$
597
100 bps decrease in rates
967
1,212
2,179
(417)
(398)
(815)
2,092
(860)
2,056
(789)
1
Does not include exposures from Wholesale Banking.
2
Represents the twelve-month NII exposure to an immediate and sustained shock in rates, and may include adjustments
for non-recurring items.
3
Includes other currency exposures.
As at January 31, 2026, an immediate and
sustained 100 bps increase in interest rates
would have had a negative impact to the
Bank’s EVE of $
2,521
million, an
increase of $
6
million from last quarter, and a positive impact to the Bank’s NII of
$
745
million, a decrease of $
45
million from last quarter. An immediate and
sustained 100 bps decrease in interest rates
would have had a positive impact to the Bank’s EVE
of $
2,179
million, an increase of $
87
million from last quarter,
and a negative impact to the Bank’s NII of $
815
million, a decrease of $
45
million from last quarter. EVE Sensitivity was relatively unchanged
over the quarter. The
quarter over quarter decrease in NII Sensitivity
is largely attributed to Treasury hedging activity.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 35
Liquidity Risk
The risk of having insufficient cash or collateral
to meet financial obligations and an inability
to, in a timely manner, raise funding or monetize assets at
a non-
distressed price. Financial obligations can arise
from deposit withdrawals, debt maturities,
commitments to provide credit or liquidity
support or the need to pledge
additional collateral.
TD’S LIQUIDITY RISK APPETITE
TD follows a disciplined liquidity management
program,
which is subject to risk governance and oversight,
and is designed to maintain sufficient liquidity
to permit
the Bank to operate through a significant
liquidity event without relying on extraordinary
central bank assistance. The Bank
maintains access to a stable and
diversified funding base and aligns
its funding profile with that of the assets and
contingent obligations it supports.
WHO MANAGES LIQUIDITY RISK
The Risk Committee, the ALCO and
the Treasurer are accountable for the identification,
assessment, control, monitoring and oversight
of liquidity risk.
●
The Risk Committee regularly reviews the
Bank’s liquidity position and approves the Bank’s
Liquidity Risk Management Framework
biennially and related
policies annually.
●
The Bank’s ALCO is responsible for establishing
effective management structures and practices
to ensure appropriate measurement, management,
and
governance of liquidity risk.
●
The Global Liquidity & Funding (GLF)
Committee, a subcommittee of the ALCO
comprised of senior management from
Treasury, Wholesale Banking and Risk
Management, identifies and monitors the Bank’s liquidity
risks.
In addition to our committee oversight framework,
liquidity risk management activities
are subject to the three lines of defence governance
model. Treasury, the
first line of defence for the management of liquidity
risk, is subject to independent second line
challenge and oversight by Risk Management.
TD’s Internal Audit is
the third line of defence. The three lines of
defence are independent of the business
whose activities generate liquidity risks.
The Bank’s liquidity risk appetite and liquidity risk
management approach have not changed substantially
from that described in the Bank’s 2025 MD&A.
For a
complete discussion of liquidity risk,
refer to the “Liquidity Risk” section in the
Bank’s 2025 MD&A.
Liquid assets
The Bank’s unencumbered liquid assets could be
used to help address potential funding needs
arising from stress events. Liquid asset
eligibility considers
estimated stressed market values and
trading market depth, as well as operational,
legal, or other impediments to sale, rehypothecation
or pledging.
Assets held by the Bank to meet liquidity
requirements are summarized in the following
tables. The tables do not include assets held
within the Bank’s insurance
businesses as these are used to support insurance-specific
liabilities and capital requirements.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 36
TABLE 32: SUMMARY OF LIQUID ASSETS BY TYPE AND CURRENCY
(millions of Canadian dollars, except as noted)
As at
Securities
received as
collateral from
securities
financing and
Bank-owned
derivative
Total
Encumbered
Unencumbered
liquid assets
transactions
liquid assets
liquid assets
liquid assets
1
January 31, 2026
Cash and central bank reserves
$
15,468
$
–
$
15,468
$
1,512
$
13,956
Obligations of government, federal agencies, public sector
entities,
and multilateral development banks
2
110,878
102,198
213,076
84,292
128,784
Equities
19,763
3,116
22,879
19,196
3,683
Other debt securities
6,381
6,396
12,777
9,548
3,229
Other securities
–
–
–
–
–
Total Canadian dollar-denominated
152,490
111,710
264,200
114,548
149,652
Cash and central bank reserves
86,866
–
86,866
167
86,699
Obligations of government, federal agencies, public sector
entities,
and multilateral development banks
219,926
141,965
361,891
172,280
189,611
Equities
72,501
54,546
127,047
62,067
64,980
Other debt securities
78,918
21,705
100,623
33,346
67,277
Other securities
28,706
2,811
31,517
9,375
22,142
Total non-Canadian dollar-denominated
486,917
221,027
707,944
277,235
430,709
Total
$
639,407
$
332,737
$
972,144
$
391,783
$
580,361
October 31, 2025
Total Canadian dollar
-denominated
$
155,500
$
128,048
$
283,548
$
124,734
$
158,814
Total non-Canadian
dollar-denominated
479,607
223,847
703,454
279,201
424,253
Total
$
635,107
$
351,895
$
987,002
$
403,935
$
583,067
1
Unencumbered liquid assets include on-balance sheet assets, assets borrowed or purchased under resale agreements,
and other off-balance sheet collateral received less encumbered
liquid assets.
2
Includes National Housing Act Mortgage-Backed Securities (NHA MBS).
Unencumbered liquid assets held in The
Toronto-Dominion Bank, its domestic and foreign subsidiaries, and branches
are summarized in the following
table.
TABLE 33: SUMMARY OF UNENCUMBERED LIQUID ASSETS BY
BANK, SUBSIDIARIES, AND BRANCHES
(millions of Canadian dollars)
As at
January 31
October 31
2026
2025
The Toronto-Dominion Bank (Parent)
$
251,248
$
257,722
Bank subsidiaries
300,963
306,961
Foreign branches
28,150
18,384
Total
$
580,361
$
583,067
The Bank’s
monthly average liquid assets for the quarters
ended January 31, 2026 and October 31,
2025, are summarized in the following table.
TABLE 34: SUMMARY OF AVERAGE LIQUID ASSETS BY TYPE AND CURRENCY
(millions of Canadian dollars, except as noted)
Average for the three months ended
Securities
received as
collateral from
securities
financing and
Total
Bank-owned
derivative
liquid
Encumbered
Unencumbered
liquid assets
transactions
assets
liquid assets
liquid assets
1
January 31, 2026
Cash and central bank reserves
$
17,315
$
–
$
17,315
$
1,411
$
15,904
Obligations of government, federal agencies, public sector
entities, and multilateral development banks
2
113,942
104,359
218,301
88,169
130,132
Equities
20,459
3,175
23,634
18,590
5,044
Other debt securities
6,434
6,533
12,967
9,691
3,276
Other securities
–
–
–
–
–
Total Canadian dollar-denominated
158,150
114,067
272,217
117,861
154,356
Cash and central bank reserves
85,966
–
85,966
177
85,789
Obligations of government, federal agencies, public sector
entities, and multilateral development banks
218,923
156,405
375,328
184,750
190,578
Equities
70,541
53,719
124,260
62,173
62,087
Other debt securities
78,777
20,676
99,453
32,621
66,832
Other securities
33,863
1,858
35,721
8,889
26,832
Total non-Canadian dollar-denominated
488,070
232,658
720,728
288,610
432,118
Total
$
646,220
$
346,725
$
992,945
$
406,471
$
586,474
October 31, 2025
Total Canadian dollar
-denominated
$
157,515
$
118,748
$
276,263
$
120,942
$
155,321
Total non-Canadian
dollar-denominated
479,616
224,723
704,339
280,804
423,535
Total
$
637,131
$
343,471
$
980,602
$
401,746
$
578,856
1
Unencumbered liquid assets include on-balance sheet assets, assets borrowed or purchased under resale agreements,
and other off-balance sheet collateral received less encumbered
liquid assets.
2
Includes NHA MBS.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 37
Average unencumbered liquid assets held in
The Toronto-Dominion Bank,
its domestic and foreign subsidiaries,
and branches are summarized in the
following
table.
TABLE 35: SUMMARY OF AVERAGE UNENCUMBERED LIQUID ASSETS BY BANK, SUBSIDIARIES,
AND BRANCHES
(millions of Canadian dollars)
Average for the three months ended
January 31
October 31
2026
2025
The Toronto-Dominion
Bank (Parent)
$
259,779
$
250,998
Bank subsidiaries
300,135
305,921
Foreign branches
26,560
21,937
Total
$
586,474
$
578,856
ASSET ENCUMBRANCE
In the course of the Bank’s daily operations, assets
are pledged to obtain funding, support
trading and brokerage businesses, and participate
in clearing and/or
settlement systems. TD has pledging policies
in place that govern the amount of assets
we encumber, ensuring sufficient assets are available to meet liquidity
requirements. A summary of on- and off-balance
sheet encumbered and unencumbered assets
is presented as follows.
TABLE 36: ENCUMBERED AND UNENCUMBERED ASSETS
(millions of Canadian dollars)
As at
Total Assets
Encumbered
Unencumbered
Total
Pledged as
Available as
Assets
Collateral
1
Other
2
Collateral
3
Other
4
January 31, 2026
Cash and due from banks
$
6,287
$
–
$
–
$
–
$
6,287
Interest-bearing deposits with banks
113,672
7,683
–
95,125
10,864
Securities, trading loans, and other
1,047,174
460,644
25,937
498,562
62,031
Derivatives
83,371
–
–
–
83,371
Loans, net of allowance for loan losses
931,368
44,744
104,354
64,249
718,021
Other assets
5
102,072
214
–
–
101,858
Total assets
$
2,283,944
$
513,285
$
130,291
$
657,936
$
982,432
October 31, 2025
Total assets
$
2,265,385
$
525,387
$
127,282
$
672,337
$
940,379
1
Pledged collateral refers to the portion of assets that are pledged through encumbering activities, such as repurchase agreements, securities lending, derivative contracts, and requirements associated
with participation in clearing houses and payment systems.
2
Includes assets supporting TD’s long-term funding activities such as asset securitization and issuance of covered bonds.
3
Represents assets that are readily available for use as collateral to generate funding or support collateral requirements. This category includes unencumbered loans backed by real estate that qualify as
eligible collateral in the Federal Home Loan Bank System.
4
Other unencumbered assets are not subject to any restrictions on their use to secure funding or as collateral but would not be considered immediately available.
5
Other assets include goodwill, other intangibles, land, buildings, equipment, other depreciable assets and right-of-use assets, deferred tax assets, amounts receivable from brokers, dealers, and clients,
and other assets on the balance sheet not reported in the above categories.
LIQUIDITY STRESS TESTING AND CONTINGENCY
FUNDING PLANS
In addition to the Bank’s internal liquidity stress
metric, the Bank performs liquidity
stress testing on multiple alternate scenarios.
These scenarios consist of a mix
of TD-specific and market-wide stress
events designed to evaluate the potential
impact of risk factors material to the
Bank’s risk profile. Liquidity risk assessments
are also part of the Bank’s Enterprise-Wide Stress
Testing program.
The Bank maintains CFPs for the enterprise
and material subsidiaries operating
in foreign jurisdictions. As they provide a
playbook for managing stressed
liquidity conditions, these plans are an integral
component of the Bank’s overall liquidity risk
management framework. The CFPs outline
different contingency
levels based on the severity and duration of
the liquidity event and identify recovery
actions appropriate for each level. To support operational readiness, CFPs
provide key steps required to implement
each recovery action. Regional CFPs identify
recovery actions to address region-specific
stress events. The actions and
governance structure outlined in the Bank’s
CFP are aligned with the Bank’s Crisis Management
Recovery Plan.
CREDIT RATINGS
Credit ratings may affect the Bank’s access to, and cost
of, raising funding and its ability to engage
in certain business activities on a
cost-effective basis. Credit
ratings and outlooks provided by rating agencies
reflect their views and methodologies and
are subject to change based on several
factors including the Bank’s
financial strength, competitive position,
and liquidity, as well as factors not entirely within the Bank’s control,
including conditions affecting the overall financial
services industry.
TABLE 37: CREDIT RATINGS
1
As at
January 31, 2026
Moody’s
S&P
Fitch
DBRS
Deposits/Counterparty
2
Aa1
A+
AA
AA
Legacy Senior Debt
3
Aa2
A+
AA
AA
Senior Debt
4
A2
A-
AA-
AA (low)
Covered Bonds
Aaa
–
AAA
AAA
Legacy Subordinated Debt – non-NVCC
A3
A-
A
A (high)
Tier 2 Subordinated Debt – NVCC
A3 (hyb)
BBB+
A
A (low)
AT1 Perpetual Debt – NVCC
Baa2 (hyb)
BBB-
BBB+
–
Limited Recourse Capital Notes – NVCC
Baa2 (hyb)
BBB-
BBB+
BBB (high)
Preferred Shares – NVCC
Baa2 (hyb)
BBB-
BBB+
Pfd-2
Short-Term Debt (Deposits)
P-1
A-1
F1+
R-1 (high)
Outlook
Stable
Stable
Negative
Stable
1
The above ratings are for The Toronto-Dominion
Bank legal entity. Subsidiaries’ ratings are available
on the Bank’s website at http://www.td.com/investor/credit.jsp. Credit
ratings are not
recommendations to purchase, sell, or hold a financial obligation in as much as they do not comment on market
price or suitability for a particular investor. Ratings are subject
to revision
or withdrawal at any time by the rating organization.
2
Represents Moody’s Long-Term
Deposits Ratings and Counterparty Risk Rating, S&P’s Issuer Credit Rating, Fitch’s
Long-Term Deposits Rating and DBRS
’
Long-Term Issuer Rating.
3
Includes (a) Senior debt issued prior to September 23, 2018; and (b) Senior debt issued on or after September
23, 2018, which is excluded from the bank recapitalization “bail-in” regime.
4
Subject to conversion under the bank recapitalization “bail-in”
regime.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 38
The Bank regularly reviews the level
of increased collateral its trading counterparties
would require in the event of a downgrade of
TD’s credit rating. The following
table presents the additional collateral that
could have been contractually required to be
posted to OTC derivative counterparties as
of the reporting date in the
event of one, two, and three-notch downgrades
of the Bank’s credit ratings.
TABLE 38: ADDITIONAL COLLATERAL REQUIREMENTS FOR RATING DOWNGRADES
1
(millions of Canadian dollars)
Average for the three months ended
January 31
October 31
2026
2025
One-notch downgrade
$
873
$
968
Two-notch downgrade
1,342
1,435
Three-notch downgrade
2,313
2,506
1
These collateral requirements are based on each OTC trading counterparty’s Credit Support Annex
and the Bank’s credit rating across applicable rating agencies.
LIQUIDITY COVERAGE RATIO (LCR)
The LCR is a Basel III standard designed to ensure
that banks have an adequate stock of unencumbered
HQLA, consisting of cash or assets that
can be
converted into cash, to meet their liquidity
needs for a 30-calendar day liquidity stress
scenario.
In accordance with OSFI’s LAR, the Bank
must maintain a minimum LCR of 100%,
except during periods of financial stress
when institutions are permitted to
use their stock of HQLA. The Bank’s LCR is
calculated according to the scenario
parameters in the LAR guideline, including
prescribed HQLA eligibility criteria and
haircuts, deposit run-off, and other outflow and
inflow rates. LCR-eligible HQLA consist
primarily of central bank reserves, sovereign-issued
or sovereign-
guaranteed securities, and high-quality
securities issued by non-financial entities.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 39
18
The following table summarizes the Bank’s average
daily LCR as of the relevant dates.
TABLE 39: AVERAGE LIQUIDITY COVERAGE RATIO
1
(millions of Canadian dollars, except
as noted)
Average for the three months ended
January 31, 2026
Total unweighted
Total weighted
value (average)
2
value (average)
3
High-quality liquid assets
Total high-quality liquid assets
$
n/a
4
$
341,809
Cash outflows
Retail deposits and deposits from small business
customers, of which:
$
512,136
$
33,384
Stable deposits
268,789
8,064
Less stable deposits
243,347
25,320
Unsecured wholesale funding, of which:
401,551
194,417
Operational deposits (all counterparties)
and deposits in networks of cooperative banks
151,468
35,617
Non-operational deposits (all counterparties)
225,074
133,791
Unsecured debt
25,009
25,009
Secured wholesale funding
n/a
56,000
Additional requirements, of which:
392,289
139,555
Outflows related to derivative exposures and
other collateral requirements
85,605
75,186
Outflows related to loss of funding on debt products
12,007
12,007
Credit and liquidity facilities
294,677
52,362
Other contractual funding obligations
19,894
10,423
Other contingent funding obligations
872,798
13,283
Total cash outflows
$
n/a
$
447,062
Cash inflows
Secured lending
$
301,365
$
61,426
Inflows from fully performing exposures
26,681
12,153
Other cash inflows
124,014
124,014
Total cash inflows
$
452,060
$
197,593
Average for the three months ended
January 31, 2026
October 31, 2025
Total adjusted
Total adjusted
value
value
Total high-quality liquid assets
$
341,809
$
346,383
Total net cash outflows
249,469
265,844
Liquidity coverage ratio
137
%
130
%
1
The LCR is calculated in accordance with OSFI’s LAR guideline, which is reflective of liquidity-related
requirements published by the BCBS. The LCR for the quarter ended
January 31, 2026
is calculated as an average of the 61 daily data points in the quarter.
2
Unweighted inflow and outflow values are outstanding balances maturing or callable within 30 days.
3
Weighted values are calculated after the application of respective HQLA haircuts or inflow and outflow
rates, and caps as prescribed by the OSFI LAR guideline.
4
Not applicable as per the LCR common disclosure template.
The Bank’s average LCR was 137%
for the quarter ended January 31,
2026 and continues to meet regulatory
requirements
.
The Bank holds a variety of liquid assets
commensurate with its liquidity needs.
Most of these liquid assets also qualify as
HQLA under the OSFI LAR guideline.
The Bank’s Level 1 assets for the quarter ended
January 31, 2026, as calculated according
to OSFI LAR and the BCBS LCR requirements,
represent 86% of total
HQLA (October 31, 2025 – 86%).
In accordance with the OSFI LAR guideline,
the Bank’s reported HQLA excludes excess HQLA
from U.S. Banking operations to
reflect liquidity transfer considerations between
U.S. Banking and affiliates as a result of the U.S.
Federal Reserve Board’s regulations. By excluding
excess
HQLA, the U.S. Banking LCR is effectively capped
at 100% prior to total Bank consolidation.
As described in the “How TD Manages Liquidity
Risk” section of the Bank’s 2025 MD&A, the Bank
manages its HQLA and other liquidity buffers to
the higher of
TD’s internal 90-day surplus requirement and its
target buffers over regulatory requirements including
those for LCR, NSFR, and the Net Cumulative
Cash Flow
metrics.
18
The Bank’s expectations regarding liquidity levels are based on the Bank’s assumptions
regarding certain factors, including product growth, strategic plans,
and pace of share
repurchases under the Bank’s normal course issuer bid (which is subject to financial forecasts and capital
requirements). The Bank’s assumptions are subject to inherent uncertainties
and may vary based on factors both within and outside the Bank’s control, including general market conditions,
economic outlook and geopolitical matters. Refer to the “Risk Factors
That May Affect Future Results” section of this document for additional information about risks and uncertainties
that may impact the Bank’s estimates.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 40
NET STABLE
FUNDING RATIO (NSFR)
The NSFR is a Basel III metric calculated as
the ratio of total available stable funding
(ASF) to total required stable funding (RSF).
The Bank must maintain an
NSFR equal to or above 100% in accordance
with the LAR guideline. The Bank’s ASF comprises
the Bank’s liability and capital instruments
(including deposits
and wholesale funding). The assets that require
stable funding are a function of the Bank’s on and
off-balance sheet activities,
their liquidity characteristics, and
OSFI’s LAR guideline requirements.
TABLE 40: NET STABLE FUNDING RATIO
1
(millions of Canadian dollars, except
as noted)
As at
January 31, 2026
Unweighted value by residual maturity
6 months to
No
Less than
less than
More than
Weighted
maturity
2
6 months
1 year
1 year
value
3
Available Stable Funding Item
Capital
$
121,525
$
n/a
$
n/a
$
5,504
$
127,029
Regulatory capital
121,525
n/a
n/a
5,504
127,029
Other capital instruments
n/a
n/a
n/a
–
–
Retail deposits and deposits from small business
customers:
467,152
73,276
32,821
28,715
558,938
Stable deposits
254,686
29,087
14,037
13,983
296,902
Less stable deposits
212,466
44,189
18,784
14,732
262,036
Wholesale funding:
269,400
459,409
84,942
238,343
458,145
Operational deposits
119,791
2,580
1
–
61,186
Other wholesale funding
149,610
456,829
84,941
238,343
396,959
Liabilities with matching interdependent assets
4
–
1,487
2,032
37,109
–
Other liabilities:
45,827
96,297
8,087
NSFR derivative liabilities
n/a
8,891
n/a
All other liabilities and equity not included
in the above categories
45,827
77,844
2,949
6,613
8,087
Total Available Stable Funding
$
1,152,199
Required Stable Funding Item
Total NSFR high-quality liquid assets
$
n/a
$
n/a
$
n/a
$
n/a
$
61,166
Deposits held at other financial institutions for
operational purposes
–
–
–
–
–
Performing loans and securities
136,722
309,423
126,521
667,975
793,885
Performing loans to financial institutions
secured by Level 1 HQLA
–
79,004
5,307
215
9,592
Performing loans to financial institutions
secured by non-Level 1
HQLA and unsecured performing loans to
financial institutions
–
99,858
9,482
13,956
29,537
Performing loans to non-financial corporate
clients, loans to retail
and small business customers, and loans
to sovereigns, central
banks and PSEs, of which:
41,477
60,842
46,181
294,724
343,377
With a risk weight of less than or equal
to 35% under the Basel II
standardized approach for credit risk
n/a
–
–
–
–
Performing residential mortgages, of which:
37,352
65,100
62,076
283,196
292,943
With a risk weight of less than or equal
to 35% under the Basel II
standardized approach for credit risk
37,352
65,100
62,076
283,196
292,943
Securities that are not in default and do not
qualify as HQLA,
including exchange-traded equities
57,892
4,618
3,474
75,886
118,437
Assets with matching interdependent liabilities
4
–
3,094
2,701
34,834
–
Other assets:
83,596
147,491
119,005
Physical traded commodities, including gold
30,963
n/a
n/a
n/a
26,908
Assets posted as initial margin for derivative
contracts and
contributions to default funds of CCPs
–
–
–
21,577
18,341
NSFR derivative assets
n/a
–
–
8,653
–
NSFR derivative liabilities before deduction
of variation margin
posted
n/a
24,788
1,239
All other assets not included in the above
categories
52,633
82,539
2,028
7,905
72,516
Off-balance sheet items
n/a
865,140
31,331
Total Required Stable Funding
$
1,005,388
Net Stable Funding Ratio
115
%
As at
October 31, 2025
Total Available Stable Funding
$
1,174,124
Total Required Stable Funding
1,003,524
Net Stable Funding Ratio
117
%
1
The NSFR is calculated in accordance with OSFI’s LAR guideline, which is reflective of liquidity-related
requirements published by the BCBS.
2
Items in the “no maturity” time bucket do not have a stated maturity. These
may include, but are not limited to, items such as capital with perpetual maturity,
non-maturity deposits, short
positions, open maturity positions, non-HQLA equities, and physical traded commodities.
3
Weighted values are calculated after the application of respective NSFR weights, as prescribed by the
OSFI LAR guideline.
4
Interdependent asset and liability items are deemed by OSFI to be interdependent and have RSF and ASF risk factors
adjusted to zero. Interdependent liabilities cannot fall due while the
asset is still on balance sheet, cannot be used to fund any other assets and principal payments from the asset cannot
be used for anything other than repaying the liability.
As such, the
only interdependent assets and liabilities that qualify for this treatment at the Bank are the liabilities arising from the
Canada Mortgage Bonds Program and their corresponding
encumbered assets.
The Bank’s NSFR for the quarter ended January
31, 2026 is 115%
(October 31, 2025 – 117%), representing a surplus of $147 billion
and adhering to regulatory
requirements.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 41
FUNDING
The Bank has access to a variety of unsecured
and secured funding sources. The Bank’s
funding activities are conducted in accordance
with liquidity risk
management policies that require assets be
funded to the appropriate term and to a prudent
diversification profile.
The Bank’s primary approach to funding is
to maximize the use of deposits raised through
its personal,
wealth and business banking channels.
The deposits
raised from these sources were approximately
62
% (October 31, 2025 –
64
%) of the Bank’s total funding. Non-personal
deposit funding as reflected below does
not include the Bank’s Wholesale Banking deposits
(including Corporate & Investment Banking).
TABLE 41: SUMMARY OF DEPOSIT FUNDING
(millions of Canadian dollars)
As at
January 31
October 31
2026
2025
Personal
$
638,426
$
650,396
Non-personal
305,646
316,319
Total
$
944,072
$
966,715
WHOLESALE FUNDING
The Bank maintains various registered external
wholesale term (greater than 1 year) funding
programs to provide access to diversified
funding sources, including
asset securitization, covered bonds, and
unsecured wholesale debt. The Bank raises
term funding through Senior Notes, NHA
MBS, notes backed by credit card
receivables (Evergreen Credit Card Trust) and home equity
lines of credit (Genesis Trust II). The Bank’s wholesale
funding is diversified by geography, currency,
and funding types. The Bank raises short-term
(1 year or less) funding using certificates
of deposit, and commercial paper.
The following table summarizes the registered
term funding and capital programs by geography, with the related
program size as at January 31, 2026.
Canada
United States
Europe
Capital Securities Program ($20 billion)
Canadian Senior Medium-Term Linked Notes
Program ($5 billion)
HELOC ABS Program (Genesis Trust II) ($7
billion)
U.S. SEC (F-3) Registered Capital and
Debt
Program (US$75 billion)
U.K. Financial Conduct Authority (FCA) Registered
Legislative Covered Bond Program ($100 billion)
FCA Registered Global Medium-Term Note Program
(US$40 billion)
Non-Registered Structured Global Medium-Term
Linked Notes Program (US$20 billion)
The following table presents a breakdown of
the Bank’s term debt by currency and funding
type. Term funding as at January 31,
2026, was $191.9 billion
(October 31, 2025
– $192.0 billion).
Note that Table 42: Long-Term Funding and Table
43: Wholesale Funding do not include
any funding accessed via repurchase transactions
or securities financing.
TABLE 42: LONG-TERM FUNDING
1
As at
January 31
October 31
Long-term funding by currency
2026
2025
Canadian dollar
25
%
26
%
U.S. dollar
32
33
Euro
33
32
British pound
5
4
Other
5
5
Total
100
%
100
%
Long-term funding by type
Senior unsecured medium-term notes
52
%
53
%
Covered bonds
38
37
Mortgage securitization
2
8
8
Term asset-backed securities
2
2
Total
100
%
100
%
1
The table includes secured and unsecured,
senior and subordinated notes – excluding
structured notes and commercial paper – issued
to external investors with
an original term-to-maturity of greater than
one year.
2
Mortgage securitization excludes the residential
mortgage trading business.
The Bank maintains depositor concentration
limits in respect of short-term wholesale
deposits so that it is not overly reliant
on individual depositors for funding.
The Bank further limits short-term wholesale
funding maturity concentration in an effort to
mitigate refinancing risk during a stress event.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 42
The following table represents the remaining
maturity of various sources of funding outstanding
as at January 31, 2026 and October 31, 2025.
TABLE 43: WHOLESALE FUNDING
(millions of Canadian dollars)
As at
January 31
October 31
2026
2025
Less than
1 to 3
3 to 6
6 months
Up to 1
Over 1 to
Over
1 month
months
months
to 1 year
year
2 years
2 years
Total
Total
Deposits from banks
1
$
1,735
$
516
$
216
$
860
$
3,327
$
–
$
–
$
3,327
$
2,738
Bearer deposit notes
603
5,569
1,249
461
7,882
–
–
7,882
5,732
Certificates of deposit
13,643
27,298
21,943
36,933
99,817
21
–
99,838
90,513
Commercial paper
15,021
19,898
17,527
6,519
58,965
–
–
58,965
53,759
Covered bonds
–
10,028
3,420
9,710
23,158
19,851
29,523
72,532
70,558
Mortgage securitization
2
33
673
1,423
2,301
4,430
4,075
31,915
40,420
40,124
Legacy senior unsecured medium-term
notes
3
117
–
1,340
–
1,457
–
–
1,457
1,455
Senior unsecured medium-term notes
4
–
2,772
6,340
9,910
19,022
26,595
54,144
99,761
100,681
Subordinated notes and debentures
5
–
–
–
–
–
–
10,642
10,642
10,733
Term asset-backed
securitization
1,640
2,214
3,257
5,523
12,634
1,311
1,454
15,399
15,702
Other
6
47,430
6,776
1,073
2,230
57,509
2,279
3,924
63,712
47,820
Total
$
80,222
$
75,744
$
57,788
$
74,447
$
288,201
$
54,132
$
131,602
$
473,935
$
439,815
Of which:
Secured
$
1,673
$
16,993
$
8,100
$
17,534
$
44,300
$
25,238
$
62,894
$
132,432
$
126,388
Unsecured
78,549
58,751
49,688
56,913
243,901
28,894
68,708
341,503
313,427
Total
$
80,222
$
75,744
$
57,788
$
74,447
$
288,201
$
54,132
$
131,602
$
473,935
$
439,815
1
Only includes fixed-term commercial bank deposits.
2
Includes mortgage-backed securities (MBS) issued to external investors and Wholesale Banking residential mortgage
trading business.
3
Includes a) senior debt issued prior to September 23, 2018; and b) senior debt issued on or after September 23,
2018 which is excluded from the bank recapitalization “bail-in” regime,
including debt with an original term-to-maturity of less than 400 days.
4
Comprised of senior debt subject to conversion under the bank recapitalization “bail-in”
regime. Excludes $2.6 billion of structured notes subject to conversion under the “bail-in”
regime (October 31, 2025 – $3.3 billion).
5
Subordinated notes and debentures are not considered wholesale funding as they may be raised primarily for capital
management purposes.
6
Includes fixed-term deposits from non-bank institutions (unsecured) of $36.8 billion (October 31, 2025 – $26.9
billion) and the remaining are non-term deposits.
Excluding the Wholesale Banking residential
mortgage trading business, the Bank’s total
mortgage-backed securities issued to external
investors for the three
months ended January 31, 2026, were $1.1
billion (three months ended January 31, 2025
– $1.0 billion) and other asset-backed
securities issued for the three
months ended January 31, 2026, were nil (three
months ended January 31,
2025 – $0.2
billion). The Bank also issued $6.4 billion
of unsecured medium-term
notes for the three months ended January
31, 2026
(three months ended January 31, 2025 –
$10.8 billion). Covered bonds issued
for the three months ended
January 31, 2026
were $2.3 billion (three months ended January
31, 2025
– nil).
MATURITY ANALYSIS OF ASSETS, LIABILITIES, AND OFF-BALANCE SHEET COMMITMENTS
The following table summarizes on-balance
sheet and off-balance sheet categories by remaining
contractual maturity. The values of credit instruments reported in
the following table represent the maximum amount
of additional credit that the Bank could
be obligated to extend should such instruments
be fully drawn or
utilized. Since a significant portion of guarantees
and commitments are expected to expire
without being drawn upon, the total of the
contractual amounts is not
representative of expected future liquidity requirements.
These contractual obligations have an impact
on the Bank’s short-term and long-term liquidity
and capital
resource needs.
The maturity analysis presented does not depict
the degree of the Bank’s maturity transformation or
the Bank’s exposure to interest rate and liquidity risk.
The
Bank’s objective is to fund its assets appropriately
to protect against borrowing cost volatility
and potential reductions to funding market
availability. The Bank
utilizes stable non-maturity deposits (chequing
and savings accounts) and term deposits
as the primary source of long-term funding
for the Bank’s non-trading
assets including personal and business
term loans and the stable balance of revolving
lines of credit. Additionally, the Bank issues long-term funding in
respect of
such non-trading assets and raises short
term funding primarily to finance trading assets.
The liquidity of trading assets under stressed
market conditions is
considered when determining the appropriate
term of the funding.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 43
TABLE 44: REMAINING CONTRACTUAL MATURITY
(millions of Canadian dollars)
As at
January 31, 2026
No
Less than
1 to 3
3 to 6
6 to 9
9 months
Over 1 to
Over 2 to
Over
specific
1 month
months
months
months
to 1 year
2 years
5 years
5 years
maturity
Total
Assets
Cash and due from banks
$
6,287
$
–
$
–
$
–
$
–
$
–
$
–
$
–
$
–
$
6,287
Interest-bearing deposits with banks
110,870
583
206
–
–
–
–
–
2,013
113,672
Trading loans, securities, and other
1
3,308
6,034
7,188
2,556
3,604
11,709
34,863
32,647
132,979
234,888
Non-trading financial assets at fair value through
profit or loss
–
–
521
5
2
552
3,259
1,851
2,235
8,425
Derivatives
10,414
14,640
7,753
5,911
6,370
11,649
17,638
8,996
–
83,371
Financial assets designated at fair value through
profit or loss
408
257
625
224
329
1,328
3,289
578
–
7,038
Financial assets at fair value through other comprehensive
income
1,785
2,732
5,455
5,839
3,172
6,695
50,444
48,444
3,306
127,872
Debt securities at amortized cost, net of allowance
for credit losses
1,574
4,092
9,228
5,941
4,394
39,753
60,544
108,745
(1)
234,270
Securities purchased under reverse repurchase
agreements
2
160,563
33,191
17,136
7,484
3,445
403
700
–
3
222,925
Loans
Residential mortgages
5,379
11,830
18,504
22,643
16,498
74,375
110,524
48,398
–
308,151
Consumer instalment and other personal
1,624
3,873
8,194
6,551
5,488
32,888
103,033
37,746
67,233
266,630
Credit card
–
–
–
–
–
–
–
–
41,070
41,070
Business and government
67,097
15,673
17,375
16,585
15,415
38,638
90,684
55,595
34,139
351,201
Total loans
74,100
31,376
44,073
45,779
37,401
145,901
304,241
141,739
142,442
967,052
Allowance for loan losses
–
–
–
–
–
–
–
–
(8,566)
(8,566)
Loans, net of allowance for loan losses
74,100
31,376
44,073
45,779
37,401
145,901
304,241
141,739
133,876
958,486
Goodwill
3
–
–
–
–
–
–
–
–
18,472
18,472
Other intangibles
3
–
–
–
–
–
–
–
–
3,437
3,437
Land, buildings, equipment, other depreciable
assets, and right-of-use assets
3
–
2
4
7
15
66
697
3,230
5,894
9,915
Deferred tax assets
–
–
–
–
–
–
–
–
4,983
4,983
Amounts receivable from brokers, dealers, and clients
37,015
–
–
–
–
–
–
–
–
37,015
Other assets
5,431
4,441
1,120
615
494
203
494
497
14,955
28,250
Total assets
$
411,755
$
97,348
$
93,309
$
74,361
$
59,226
$
218,259
$
476,169
$
346,727
$
322,152
$
2,099,306
Liabilities
Trading deposits
$
2,154
$
7,618
$
3,793
$
4,731
$
5,009
$
7,361
$
8,211
$
3,451
$
–
$
42,328
Derivatives
13,868
13,526
9,728
5,681
5,691
8,527
17,318
9,156
–
83,495
Securitization liabilities at fair value
33
485
1,061
742
605
2,508
14,566
5,399
–
25,399
Financial liabilities designated at
fair value through profit or loss
71,453
56,421
48,410
29,282
19,378
–
3
–
290
225,237
Deposits
4,5
Personal
15,434
24,951
25,720
19,759
17,493
16,699
12,407
1
505,962
638,426
Banks
10,149
4,179
–
48
–
1
2
–
10,150
24,529
Business and government
21,121
27,199
17,904
10,590
15,004
47,910
52,756
34,511
355,194
582,189
Total deposits
46,704
56,329
43,624
30,397
32,497
64,610
65,165
34,512
871,306
1,245,144
Obligations related to securities sold short
1
2,494
1,769
946
1,236
634
6,283
12,660
12,116
3,317
41,455
Obligations related to securities sold under repurchase
agreements
2
187,630
20,130
5,136
707
95
44
40
–
–
213,782
Securitization liabilities at amortized cost
–
188
362
568
387
1,566
5,195
6,755
–
15,021
Amounts payable to brokers, dealers, and clients
29,328
–
–
–
–
–
–
–
–
29,328
Insurance-related liabilities
222
411
617
617
650
1,196
1,994
856
807
7,370
Other liabilities
8,261
2,564
2,266
1,372
2,814
2,455
1,513
5,713
7,551
34,509
Subordinated notes and debentures
–
–
–
–
–
–
–
10,642
–
10,642
Equity
–
–
–
–
–
–
–
–
125,596
125,596
Total liabilities and equity
$
362,147
$
159,441
$
115,943
$
75,333
$
67,760
$
94,550
$
126,665
$
88,600
$
1,008,867
$
2,099,306
Off-balance sheet commitments
Credit and liquidity commitments
6,7
$
12,183
$
40,416
$
36,226
$
24,027
$
25,417
$
51,621
$
176,008
$
4,861
$
1,896
$
372,655
Other commitments
8
118
207
323
228
369
879
2,618
302
12
5,056
Unconsolidated structured entity commitments
233
1,286
3,385
751
3,411
6,180
2,046
–
–
17,292
Total off-balance sheet commitments
$
12,534
$
41,909
$
39,934
$
25,006
$
29,197
$
58,680
$
180,672
$
5,163
$
1,908
$
395,003
1
Amount has been recorded according to the remaining contractual maturity of the underlying security.
2
Certain contracts considered short-term are presented in ‘less than 1 month’ category.
3
Certain non-financial assets have been recorded as having ‘no specific maturity’.
4
As the timing of demand deposits and notice deposits is non-specific and callable by the depositor,
obligations have been included as having ‘no specific maturity’.
5
Includes $
73
billion of covered bonds with remaining contractual maturities of $
10
billion in ‘over 1 months to 3 months’, $
3
billion in ‘over 3 months to 6 months’, $
5
billion in ‘over 6
months to 9 months’, $
5
billion in ‘over 9 months to 1 year’, $
20
billion in ‘over 1 to 2 years’, $
22
billion in ‘over 2 to 5 years’, and $
8
billion in ‘over 5 years’.
6
Includes $
531
million in commitments to extend credit to private equity investments.
7
Commitments to extend credit exclude personal lines of credit and credit card lines, which are unconditionally cancellable
at the Bank’s discretion at any time.
8
Includes various purchase commitments as well as commitments for leases not yet commenced, and lease-related
payments.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 44
TABLE 44: REMAINING CONTRACTUAL MATURITY
(continued)
(millions of Canadian dollars)
As at
October 31, 2025
No
Less than
1 to 3
3 to 6
6 to 9
9 months
Over 1 to
Over 2 to
Over
specific
1 month
months
months
months
to 1 year
2 years
5 years
5 years
maturity
Total
Assets
Cash and due from banks
$
7,512
$
–
$
–
$
–
$
–
$
–
$
–
$
–
$
–
$
7,512
Interest-bearing deposits with banks
106,857
724
39
–
–
–
–
–
1,797
109,417
Trading loans, securities, and other
1
4,243
5,867
5,219
3,647
4,107
10,100
33,372
31,052
122,529
220,136
Non-trading financial assets at fair value through
profit or loss
–
–
–
74
–
332
2,939
1,873
2,177
7,395
Derivatives
10,478
12,594
7,269
4,638
5,006
11,761
17,913
13,313
–
82,972
Financial assets designated at fair value through
profit or loss
271
226
543
649
251
1,396
2,715
935
–
6,986
Financial assets at fair value through other comprehensive
income
1,959
4,006
3,698
3,802
6,061
6,002
48,054
49,739
3,048
126,369
Debt securities at amortized cost, net of allowance
for credit losses
4,850
3,768
5,670
7,152
3,992
28,954
70,952
115,102
(1)
240,439
Securities purchased under reverse repurchase
agreements
2
164,872
40,541
28,394
6,906
4,840
786
739
–
–
247,078
Loans
Residential mortgages
3,463
7,240
16,334
25,284
23,462
78,900
112,140
48,240
–
315,063
Consumer instalment and other personal
1,115
2,652
6,373
9,240
7,052
31,673
96,668
37,975
66,285
259,033
Credit card
–
–
–
–
–
–
–
–
41,662
41,662
Business and government
59,741
12,360
13,577
17,631
17,491
44,950
89,699
56,975
33,519
345,943
Total loans
64,319
22,252
36,284
52,155
48,005
155,523
298,507
143,190
141,466
961,701
Allowance for loan losses
–
–
–
–
–
–
–
–
(8,689)
(8,689)
Loans, net of allowance for loan losses
64,319
22,252
36,284
52,155
48,005
155,523
298,507
143,190
132,777
953,012
Goodwill
3
–
–
–
–
–
–
–
–
18,980
18,980
Other intangibles
3
–
–
–
–
–
–
–
–
3,409
3,409
Land, buildings, equipment, other depreciable
assets, and right-of-use assets
3
–
3
2
4
10
86
679
3,333
6,015
10,132
Deferred tax assets
–
–
–
–
–
–
–
–
5,388
5,388
Amounts receivable from brokers, dealers, and clients
27,345
–
–
–
–
–
–
–
–
27,345
Other assets
5,207
2,630
3,076
521
485
199
412
507
14,951
27,988
Total assets
$
397,913
$
92,611
$
90,194
$
79,548
$
72,757
$
215,139
$
476,282
$
359,044
$
311,070
$
2,094,558
Liabilities
Trading deposits
$
3,346
$
4,147
$
5,288
$
2,790
$
4,967
$
6,314
$
7,931
$
3,099
$
–
$
37,882
Derivatives
10,690
13,350
8,930
7,039
4,359
8,034
15,169
11,785
–
79,356
Securitization liabilities at fair value
–
1,096
570
1,069
739
2,248
13,667
5,894
–
25,283
Financial liabilities designated at
fair value through profit or loss
48,996
46,231
57,600
26,665
17,192
652
3
–
296
197,635
Deposits
4,5
Personal
15,300
30,652
24,351
17,289
19,285
17,296
12,784
2
513,437
650,396
Banks
15,232
96
56
–
49
2
2
–
11,796
27,233
Business and government
18,548
20,498
19,236
15,276
10,272
51,067
56,791
32,004
365,783
589,475
Total deposits
49,080
51,246
43,643
32,565
29,606
68,365
69,577
32,006
891,016
1,267,104
Obligations related to securities sold short
1
2,677
575
1,304
1,647
1,245
6,351
14,346
12,879
2,771
43,795
Obligations related to securities sold under repurchase
agreements
2
196,625
20,970
3,017
237
114
164
23
–
–
221,150
Securitization liabilities at amortized cost
–
719
182
367
567
1,602
5,104
6,300
–
14,841
Amounts payable to brokers, dealers, and clients
27,434
–
–
–
–
–
–
–
–
27,434
Insurance-related liabilities
215
405
607
608
641
1,137
1,508
1,288
869
7,278
Other liabilities
5,198
6,600
2,535
1,628
922
2,380
2,024
5,944
7,009
34,240
Subordinated notes and debentures
–
–
–
–
–
–
–
10,733
–
10,733
Equity
–
–
–
–
–
–
–
–
127,827
127,827
Total liabilities and equity
$
344,261
$
145,339
$
123,676
$
74,615
$
60,352
$
97,247
$
129,352
$
89,928
$
1,029,788
$
2,094,558
Off-balance sheet commitments
Credit and liquidity commitments
6,7
$
16,424
$
45,279
$
31,734
$
23,774
$
23,268
$
49,354
$
174,265
$
3,658
$
1,990
$
369,746
Other commitments
8
131
233
271
325
246
931
2,864
376
12
5,389
Unconsolidated structured entity commitments
1,312
1,004
1,855
3,143
1,787
7,012
2,930
–
–
19,043
Total off-balance sheet commitments
$
17,867
$
46,516
$
33,860
$
27,242
$
25,301
$
57,297
$
180,059
$
4,034
$
2,002
$
394,178
1
Amount has been recorded according to the remaining contractual maturity of the underlying security.
2
Certain contracts considered short-term are presented in ‘less than 1 month’ category.
3
Certain non-financial assets have been recorded as having ‘no specific maturity’.
4
As the timing of demand deposits and notice deposits is non-specific and callable by the depositor,
obligations have been included as having ‘no specific maturity’.
5
Includes $
70
billion of covered bonds with remaining contractual maturities of $
10
billion in ‘over 3 months to 6 months’, $
4
billion in ‘over 6 months to 9 months’, $
5
billion in ‘over 9
months to 1 year’, $
24
billion in ‘over 1 to 2 years’, $
19
billion in ‘over 2 to 5 years’, and $
8
billion in ‘over 5 years’.
6
Includes $
623
million in commitments to extend credit to private equity investments.
7
Commitments to extend credit exclude personal lines of credit and credit card lines, which are unconditionally cancellable
at the Bank’s discretion at any time.
8
Includes various purchase commitments as well as commitments for leases not yet commenced, and lease-related
payments.
REGULATORY DEVELOPMENTS CONCERNING LIQUIDITY AND FUNDING
In May 2025, OSFI released draft guidelines
for its 2026 proposed amendments to LAR
for public consultation. Proposals introduce deposit
categorizations for
measuring liquidity risks from structured
notes and deposits sourced through non-bank
financial intermediaries and clarify expectations
for instruments with
contingent features and/or uncertain maturity
profiles, particularly in relation to their early
redemption characteristics and associated
liquidity implications. Finalized
rules were set in January 2026 for implementation
in May 2026.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 45
ISSB – IFRS S1 and IFRS S2
In March 2025, OSFI released updates to
Guideline B-15 to ensure continued interoperability
with the requirements of the final Canadian Sustainability
Standards
Board (CSSB) standards. Key updates include
postponing the implementation date
for industry-based metrics and Scope
3 GHG emissions disclosures from fiscal
year end 2025 to 2028. The Bank’s 2025 annual
sustainability report suite will incorporate
the phased-in cross-industry metrics requirements,
effective for
October 31, 2025.
In April 2025, the Canadian Securities Administrators
(CSA) announced that it is pausing work
on the development of a new mandatory
climate-related disclosure
rule that is based on the two standards issued
by the CSSB. The CSSB standards were
released in December 2024 and are based
on the international
sustainability standards issued by the International
Sustainability Standards Board (ISSB).
They set out the disclosure requirements for
financially material
information about sustainability and climate-related
risks and opportunities to meet investor
information needs. For these standards
to become mandatory
requirements in Canada, they would need
to be incorporated into a CSA rule. The Bank
continues to assess the impact of adopting these
standards and to monitor
developments from various standard setters
and regulators.
SECURITIZATION AND
OFF-BALANCE SHEET ARRANGEMENTS
The Bank enters into securitization and off-balance
sheet arrangements in the normal course of
operations. The Bank is involved with
structured entities (SEs) that
it sponsors, as well as entities sponsored
by third parties. Refer to “Securitization and
Off-Balance Sheet Arrangements”
section, Note 9: Transfers of Financial
Assets and Note 10: Structured Entities of
the Bank’s 2025 Annual Report for further details.
There have been no significant changes
to the Bank’s securitization
and off-balance sheet arrangements during the quarter
ended January 31, 2026.
Securitization of Third-Party Originated
Assets
Significant Unconsolidated Special Purpose
Entities
The Bank securitizes third-party originated
assets through Bank-sponsored SEs, including
its multi-seller conduits which are not consolidated.
Multi-seller conduits
securitize third-party originated assets.
The Bank administers multi-seller conduits
and provides liquidity facilities as well as
securities distribution services; it may
also provide credit enhancements. TD’s total potential
exposure to loss through the provision
of liquidity facilities for multi-seller conduits
was $56.5 billion as at
January 31, 2026
(October 31, 2025
– $57.5 billion). As at January 31, 2026, the Bank
had funded exposure of $39.2 billion under
such liquidity facilities relating to
outstanding issuances of asset-backed
commercial paper (ABCP)
(October 31, 2025
– $38.5 billion).
ACCOUNTING POLICIES AND ESTIMATES
The Bank’s
unaudited Interim Consolidated Financial
Statements have been prepared in accordance
with IFRS. For details of the Bank’s
accounting policies under
IFRS, refer to Note 2 of the Bank’s first quarter
2026 Interim Consolidated Financial Statements
and 2025
Annual Consolidated Financial Statements.
For details
of the Bank’s significant accounting judgments,
estimates, and assumptions under IFRS,
refer to Note 3 of the Bank’s first quarter
2026 Interim Consolidated
Financial Statements and the Bank’s 2025
Annual Consolidated Financial Statements.
CURRENT CHANGES IN ACCOUNTING
POLICIES
There were no new accounting policies adopted
by the Bank for the three months ended
January 31, 2026.
ACCOUNTING JUDGMENTS, ESTIMATES,
AND ASSUMPTIONS
The estimates used in the Bank’s accounting
policies are essential to understanding its
results of operations and financial condition.
Some of the Bank’s policies
require subjective, complex judgments and
estimates as they relate to matters
that are inherently uncertain. Changes in these judgments
or estimates and
changes to accounting standards and policies
could have a materially adverse impact
on the Bank’s Interim Consolidated Financial Statements.
The Bank has
established procedures to ensure that accounting
policies are applied consistently and that
the processes for changing methodologies,
determining estimates, and
adopting new accounting standards are well-controlled
and occur in an appropriate and systematic
manner.
Impairment – Expected Credit Loss Model
The ECL model requires the application of judgments,
estimates,
and assumptions in the assessment of the
current and forward-looking economic
environment.
There remains elevated economic uncertainty, and management
continues to exercise expert credit judgment
in assessing if an exposure has experienced
significant increase in credit risk since initial
recognition and in determining the amount
of ECLs at each reporting date. To the extent that certain effects are not
fully incorporated into the model calculations,
temporary quantitative and qualitative adjustments
have been applied,
including for risks related to elevated
uncertainty associated with policy and trade,
and such adjustments will be updated as appropriate
in future periods.
FUTURE CHANGES IN ACCOUNTING
POLICIES
There were no new accounting standards
or amendments issued during the three
months ended January 31, 2026. Refer to Note
4 of the Bank’s 2025 Annual
Consolidated Financial Statements for a description
of future changes in accounting policies.
CHANGES IN INTERNAL CONTROL OVER FINANCIAL
REPORTING
During the most recent interim period, there
have been no changes in the Bank’s policies and
procedures and other processes that
comprise its internal control
over financial reporting, that have materially affected,
or are reasonably likely to materially
affect, the Bank’s internal control over financial
reporting. Refer to
Note 2 and Note 3 of the Bank’s first quarter
2026 Interim Consolidated Financial Statements
for further information regarding the Bank’s changes
to accounting
policies, procedures, and estimates.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 46
GLOSSARY
FINANCIAL AND BANKING TERMS
Adjusted Results:
Non-GAAP financial measures
used to assess each of the
Bank’s businesses and to measure the Bank’s overall
performance. To arrive at
adjusted results, the Bank adjusts for “items
of note”, from reported results. The
items of note relate to items which management
does not believe are indicative
of underlying business performance.
Allowance for Credit Losses:
Represent expected credit losses (ECLs)
on
financial assets, including any off-balance sheet
exposures, at the balance
sheet date. Allowance for credit losses consists
of Stage 3 allowance for
impaired financial assets and Stage 2 and
Stage 1 allowance for performing
financial assets and off-balance sheet instruments.
The allowance is increased
by the provision for credit losses,
decreased by write-offs net of recoveries and
disposals,
and impacted by foreign exchange.
Amortized Cost:
The amount at which a financial asset or
financial liability is
measured at initial recognition minus principal
repayments, plus or minus the
cumulative amortization, using EIRM, of any
differences between the initial
amount and the maturity amount, and
minus any reduction for impairment.
Assets under Administration (AUA):
Assets that are beneficially owned by
customers where the Bank provides services
of an administrative nature, such
as the collection of investment income and
the placing of trades on behalf of the
clients (where the client has made his or
her own investment selection). The
majority of these assets are not reported on
the Bank’s Consolidated Balance
Sheet.
Assets under Management (AUM):
Assets that are beneficially owned by
customers, managed by the Bank, where
the Bank has discretion to make
investment selections on behalf of the
client (in accordance with an investment
policy). In addition to the TD family of mutual
funds, the Bank manages assets
on behalf of individuals, pension funds, corporations,
institutions, endowments
and foundations. These assets are not reported
on the Bank’s Consolidated
Balance Sheet. Some assets under management
that are also administered by
the Bank are included in assets under administration.
Asset-Backed Commercial Paper (ABCP):
A form of commercial paper that is
collateralized by other financial assets.
Institutional investors usually purchase
such instruments in order to diversify their assets
and generate short-term
gains.
Asset-Backed Securities (ABS):
A security whose value and income
payments are derived from and collateralized
(or “backed”) by a specified pool
of underlying assets.
Average Common Equity:
Average common equity for the business
segments
reflects the average allocated capital. The
Bank’s methodology for allocating
capital to its business segments is largely aligned
with the common equity
capital requirements under Basel III.
Average Interest-Earning Assets:
A non-GAAP financial measure that depicts
the Bank’s financial position, and is calculated
as the average carrying value of
deposits with banks, loans and securities based
on daily balances for the period
ending October 31 in each fiscal year.
Basic Earnings per Share (EPS):
A performance measure calculated by
dividing net income available to common
shareholders by the weighted average
number of common shares outstanding
for the period. Adjusted basic EPS is
calculated in the same manner using adjusted
net income.
Basis Points
(bps):
A unit equal to 1/100 of 1%. Thus, a 1%
change is equal to
100 basis points.
Book Value per Share:
A measure calculated by dividing common
shareholders’
equity by number of common shares at the
end of the period.
Carrying Value:
The value at which an asset or liability
is carried at on the
Consolidated Balance Sheet.
Catastrophe Claims:
Insurance claims that relate to any single
event that
occurred in the period, for which the aggregate
insurance claims are equal to
or greater than an internal threshold of $5
million before reinsurance. The
Bank’s internal threshold may change from time
to time.
Collateralized Mortgage Obligation (CMO):
They are collateralized debt
obligations consisting of mortgage-backed
securities that are separated and
issued as different classes of mortgage pass-through
securities with different
terms, interest rates, and risks. CMOs by private
issuers are collectively
referred to as non-agency CMOs.
Common Equity Tier 1 (CET1) Capital:
This is a primary Basel III capital
measure comprised mainly of common equity, retained earnings and
qualifying
non-controlling interest in subsidiaries. Regulatory
deductions made to arrive
at the CET1 Capital include goodwill
and intangibles, unconsolidated
investments in banking, financial, and insurance
entities, deferred tax assets,
defined benefit pension fund assets, and
shortfalls in allowances.
Common Equity Tier 1 (CET1) Capital Ratio:
CET1 Capital ratio represents
the predominant measure of capital adequacy
under Basel III
and equals CET1 Capital divided by RWA.
Compound Annual Growth Rate (CAGR):
A measure of growth over multiple
time periods from the initial investment value
to the ending investment value
assuming that the investment has been compounding
over the time period.
Credit Valuation Adjustment (CVA):
CVA represents a capital charge that
measures credit risk due to default of derivative
counterparties. This charge
requires banks to capitalize for the potential
changes in counterparty credit
spread for the derivative portfolios.
Diluted EPS:
A performance measure calculated by dividing
net income
available to common shareholders by the
weighted average number of
common shares outstanding adjusting
for the effect of all potentially dilutive
common shares. Adjusted diluted EPS is
calculated in the same manner using
adjusted net income.
Dividend Payout Ratio:
A ratio represents the percentage of Bank’s earnings
being paid to common shareholders in
the form of dividends and is calculated
by dividing common dividends by net income
available to common
shareholders. Adjusted dividend payout ratio
is calculated in the same manner
using adjusted net income.
Dividend Yield:
A ratio calculated as the dividend per
common share for the
year divided by the daily average closing
stock price during the year.
Effective Income Tax Rate:
A rate and performance indicator calculated
by
dividing the provision for income taxes as a percentage
of net income before
taxes. Adjusted effective income tax rate is calculated
in the same manner
using adjusted results.
Effective Interest Rate (EIR):
The rate that discounts expected future cash
flows for the expected life of the financial instrument
to its carrying value. The
calculation takes into account the contractual
interest rate, along with any fees
or incremental costs that are directly
attributable to the instrument and all other
premiums or discounts.
Effective Interest Rate Method (EIRM):
A technique for calculating the actual
interest rate in a period based on the amount
of a financial instrument’s book
value at the beginning of the accounting period.
Under EIRM,
the effective
interest rate, which is a key component of
the calculation, discounts the
expected future cash inflows and outflows expected
over the life of a financial
instrument.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 47
Efficiency Ratio:
The efficiency ratio measures operating efficiency and
is
calculated by taking the non-interest expenses
as a percentage of total revenue.
A lower ratio indicates a more efficient business
operation. Adjusted efficiency
ratio is calculated in the same manner using
adjusted non-interest expenses
and adjusted total revenue.
Enhanced Disclosure Task Force (EDTF):
Established by the FSB in
May 2012, comprised of banks, analysts, investors,
and auditors, with the goal
of enhancing the risk disclosures of banks and
other financial institutions.
Expected Credit Losses (ECLs):
ECLs are the probability-weighted present
value of expected cash shortfalls over
the remaining expected life of the
financial instrument and considers reasonable
and supportable information
about past events, current conditions, and forecasts
of future events and
economic conditions that impact the Bank’s
credit risk assessment.
Fair Value:
The price that would be received to sell an
asset or paid to transfer
a liability in an orderly transaction between
market participants at the
measurement date, under current market
conditions.
Fair value through other comprehensive
income (FVOCI):
Under IFRS 9, if
the asset passes the contractual cash
flows test (named SPPI), the business
model assessment determines how the instrument
is classified. If the instrument
is being held to collect contractual cash flows,
that is, if it is not expected to be
sold, it is measured as amortized cost. If the
business model for the instrument
is to both collect contractual cash flows and
potentially sell the asset, it is
measured at FVOCI.
Fair value through profit or loss (FVTPL):
Under IFRS 9, the classification is
dependent on two tests, a contractual
cash flow test (named SPPI) and a
business model assessment. Unless the
asset meets the requirements of both
tests, it is measured at fair value with all
changes in fair value reported in profit
or loss.
Federal Deposit Insurance Corporation
(FDIC):
A U.S. government
corporation which provides deposit insurance
guaranteeing the safety of a
depositor’s accounts in member banks.
The FDIC also examines and
supervises certain financial institutions for
safety and soundness, performs
certain consumer-protection functions, and
manages banks in receiverships
(failed banks).
Forward Contracts:
Over-the-counter contracts between two parties
that oblige
one party to the contract to buy and the other
party to sell an asset for a fixed
price at a future date.
Futures:
Exchange-traded contracts to buy or
sell a security at a predetermined
price on a specified future date.
Hedging:
A risk management technique intended
to mitigate the Bank’s
exposure to fluctuations in interest rates,
foreign currency exchange rates, or
other market factors. The elimination or
reduction of such exposure is
accomplished by engaging in capital markets
activities to establish offsetting
positions.
Impaired Loans:
Loans where, in management’s opinion,
there has been a
deterioration of credit quality to the extent
that the Bank no longer has
reasonable assurance as to the timely collection
of the full amount of principal
and interest.
Loss Given Default (LGD):
It is the amount of the loss the Bank
would likely
incur when a borrower defaults on a loan,
which is expressed as a percentage
of exposure at default.
Mark-to-Market (MTM):
A valuation that reflects current market rates
as at the
balance sheet date for financial instruments
that are carried at fair value.
Master Netting Agreements:
Legal agreements between two parties
that
have multiple derivative contracts with each
other that provide for the net
settlement of all contracts through a single
payment, in a single currency, in
the event of default or termination of any one
contract.
Net Corporate Expenses:
Non-interest expenses related to corporate
service
and control groups which are not allocated to a
business segment.
Net Interest Margin:
A non-GAAP ratio calculated as net interest
income as a
percentage of average interest-earning assets
to measure performance. This
metric is an indicator of the profitability of
the Bank’s earning assets less the
cost of funding. Adjusted net interest
margin is calculated in the same manner
using adjusted net interest income.
Non-Viability Contingent Capital (NVCC):
Instruments (preferred shares and
subordinated debt) that contain a feature or
a provision that allows the financial
institution to either permanently convert these
instruments into common shares
or fully write-down the instrument, in the event
that the institution is no longer
viable.
Notional:
A reference amount on which payments
for derivative financial
instruments are based.
Office of the Superintendent of Financial
Institutions Canada (OSFI):
The
regulator of Canadian federally chartered
financial institutions and federally
administered pension plans.
Operating Leverage:
A
non-GAAP measure that the Bank calculates
as the
difference between the % change in adjusted
revenue (U.S. Banking in source
currency) net of insurance service expense
(ISE), and adjusted expenses
(U.S. Banking in US$) grossed up by the
retailer program partners’
share of
PCL for the Bank’s U.S. strategic card portfolio.
Collectively, these
adjustments provide a measure of operating
leverage that management
believes is more reflective of underlying business
performance.
Options:
Contracts in which the writer of the option grants
the buyer the future
right, but not the obligation, to buy or to sell a
security, exchange rate, interest
rate, or other financial instrument or commodity
at a predetermined price at or
by a specified future date.
Price-Earnings Ratio:
A ratio calculated by dividing the closing
share price by
EPS based on a trailing four quarters to indicate
market performance.
Adjusted
price-earnings ratio is calculated in the
same manner using adjusted EPS.
Probability of Default (PD):
It is the likelihood that a borrower will not
be able
to meet its scheduled repayments.
Provision for Credit Losses (PCL):
Amount added to the allowance for credit
losses to bring it to a level that management
considers adequate to reflect
expected credit-related losses on its
portfolio.
Return on Common Equity (ROE):
The consolidated Bank ROE is calculated
as net income available to common shareholders
as a percentage of average
common shareholders’
equity,
utilized in assessing the Bank’s use of equity.
ROE for the business segments is calculated
as the segment net income
available to common shareholders as a percentage
of average allocated
capital. Adjusted ROE is calculated in
the same manner using adjusted net
income.
Return on Tangible Common Equity (ROTCE):
A non-GAAP financial
measure calculated as reported net income
available to common shareholders
after adjusting for the after-tax amortization
of acquired intangibles, which are
treated as an item of note, as a percentage
of average Tangible common
equity. Adjusted ROTCE is calculated in the same manner using
adjusted net
income.
Both measures can be utilized in assessing
the Bank’s use of equity.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 48
Return on Risk-weighted Assets:
Net income available to common
shareholders as a percentage of average risk-weighted
assets.
Risk-Weighted Assets (RWA):
Assets calculated by applying a regulatory
risk-
weight factor to on and off-balance sheet exposures.
The risk-weight factors are
established by the OSFI to convert on and off-balance
sheet exposures to a
comparable risk level.
Securitization:
The process by which financial assets,
mainly loans, are
transferred to structures,
which normally issue a series of asset-backed
securities to investors to fund the purchase
of loans.
Solely Payments of Principal and Interest
(SPPI):
Contractual cash flows of a
financial asset that are consistent with a basic
lending arrangement.
Swaps:
Contracts that involve the exchange of fixed
and floating interest rate
payment obligations and currencies on a notional
principal for a specified period
of time.
Tangible common equity (TCE):
A non-GAAP financial measure calculated
as
common shareholders’ equity less goodwill,
imputed goodwill, and intangibles
on an investment in Schwab and other acquired
intangible assets, net of related
deferred tax liabilities. It can be utilized in assessing
the Bank’s use of equity.
Taxable Equivalent Basis (TEB):
A calculation method (not defined in GAAP)
that increases revenues and the provision
for income taxes on certain tax-
exempt securities to an equivalent before-tax
basis to facilitate comparison of
net interest income from both taxable and
tax-exempt sources.
Tier 1 Capital Ratio:
Tier 1 Capital represents the more permanent
forms of
capital, consisting primarily of common
shareholders’
equity, retained earnings,
preferred shares and innovative instruments.
Tier 1 Capital ratio is calculated as
Tier 1 Capital divided by RWA.
Total Capital Ratio:
Total Capital is defined as the total of net Tier 1 and Tier 2
Capital. Total Capital ratio is calculated as Total Capital divided by RWA.
Total Shareholder Return (TSR):
The total return earned on an investment
in
TD’s common shares. The return measures the
change in shareholder value,
assuming dividends paid are reinvested in
additional shares.
Trading-Related Revenue:
A non-GAAP financial measure that is
the total of
trading income (loss), net interest income on
trading positions, and income from
financial instruments designated at FVTPL
that are managed within a trading
portfolio. Trading-related revenue (TEB) in the Wholesale
Banking segment is
also a non-GAAP financial measure and is
calculated in the same manner,
including TEB adjustments. Both are used
for measuring trading performance.
Value-at-Risk (VaR):
A metric used to monitor and control overall
risk levels
and to calculate the regulatory capital required
for market risk in trading
activities. VaR measures the adverse impact that potential changes
in market
rates and prices could have on the value
of a portfolio over a specified period of
time.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 49
INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
INTERIM CONSOLIDATED BALANCE
SHEET
(unaudited)
(As at and in millions of Canadian dollars)
January 31, 2026
October 31, 2025
ASSETS
Cash and due from banks
$
6,287
$
7,512
Interest-bearing deposits with banks
113,672
109,417
119,959
116,929
Trading loans, securities, and other
(Note 4)
234,888
220,136
Non-trading financial assets at fair value through profit or
loss
(Note 4)
8,425
7,395
Derivatives
(Note 4)
83,371
82,972
Financial assets designated at fair value through profit or
loss
(Note 4)
7,038
6,986
Financial assets at fair value through other comprehensive income
(Note 4)
127,872
126,369
461,594
443,858
Debt securities at amortized cost, net of allowance for
credit losses (Notes 4, 5)
234,270
240,439
Securities purchased under reverse repurchase agreements
222,925
247,078
Loans (Notes 4, 6)
Residential mortgages
308,151
315,063
Consumer instalment and other personal
266,630
259,033
Credit card
41,070
41,662
Business and government
351,201
345,943
967,052
961,701
Allowance for loan losses
(Note 6)
(8,566)
(8,689)
Loans, net of allowance for loan losses
958,486
953,012
Other
Goodwill
18,472
18,980
Other intangibles
3,437
3,409
Land, buildings, equipment, other depreciable assets and
right-of-use assets
9,915
10,132
Deferred tax assets
4,983
5,388
Amounts receivable from brokers, dealers, and clients
37,015
27,345
Other assets
(Note 8)
28,250
27,988
102,072
93,242
Total assets
$
2,099,306
$
2,094,558
LIABILITIES
Trading deposits
(Notes 4, 9)
$
42,328
$
37,882
Derivatives
(Note 4)
83,495
79,356
Securitization liabilities at fair value
(Note 4)
25,399
25,283
Financial liabilities designated at fair value through
profit or loss
(Notes 4, 9)
225,237
197,635
376,459
340,156
Deposits (Notes 4, 9)
Personal
638,426
650,396
Banks
24,529
27,233
Business and government
582,189
589,475
1,245,144
1,267,104
Other
Obligations related to securities sold short
(Note 4)
41,455
43,795
Obligations related to securities sold under repurchase agreements
213,782
221,150
Securitization liabilities at amortized cost
(Note 4)
15,021
14,841
Amounts payable to brokers, dealers, and clients
29,328
27,434
Insurance contract liabilities
7,370
7,278
Other liabilities
(Note 10)
34,509
34,240
341,465
348,738
Subordinated notes and debentures (Notes 4, 11)
10,642
10,733
Total liabilities
1,973,710
1,966,731
EQUITY
Shareholders’ Equity
Common shares
(Note 12)
24,551
24,727
Preferred shares and other equity instruments
(Note 12)
11,625
11,625
Treasury – common shares
(Note 12)
(5)
–
Treasury – preferred shares and other
equity instruments
(Note 12)
(11)
(4)
Contributed surplus
315
285
Retained earnings
78,253
78,320
Accumulated other comprehensive income (loss)
10,868
12,874
Total equity
125,596
127,827
Total liabilities and equity
$
2,099,306
$
2,094,558
The accompanying Notes are an integral part of these Interim Consolidated Financial Statements.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 50
INTERIM CONSOLIDATED STATEMENT OF INCOME
(unaudited)
(millions of Canadian dollars, except
as noted)
For the three months ended
January 31
January 31
2026
2025
Interest income
1
(Note 19)
Loans
$
12,719
$
13,467
Reverse repurchase agreements
2,217
2,606
Securities
Interest
4,259
4,702
Dividends
632
523
Deposits with banks
869
1,574
20,696
22,872
Interest expense (Note 19)
Deposits
8,586
11,223
Securitization liabilities
231
228
Subordinated notes and debentures
122
135
Repurchase agreements and short sales
2,752
2,990
Other
216
430
11,907
15,006
Net interest income
8,789
7,866
Non-interest income
Investment and securities services
2,369
2,014
Credit fees
393
419
Trading income (loss)
1,499
1,305
Service charges
703
686
Card services
728
773
Insurance revenue
2,001
1,870
Other income (loss)
(Note 5)
103
(884)
7,796
6,183
Total revenue
16,585
14,049
Provision for (recovery of) credit losses
(Note 6)
1,039
1,212
Insurance service expenses
1,622
1,507
Non-interest expenses
Salaries and employee benefits
4,957
4,650
Occupancy, including depreciation
517
512
Technology and equipment, including depreciation
707
689
Amortization of other intangibles
208
187
Communication and marketing
355
341
Restructuring charges
(Note 17)
200
–
Brokerage-related and sub-advisory fees
128
129
Professional, advisory and outside services
1,046
893
Other
635
669
8,753
8,070
Income before income taxes and share
of net income from investment
in Schwab
5,171
3,260
Provision for (recovery of) income taxes
1,128
698
Share of net income from investment
in Schwab (Note 7)
–
231
Net income
4,043
2,793
Preferred dividends and distributions
on other equity instruments
101
86
Net income available to common shareholders
$
3,942
$
2,707
Earnings per share
(Canadian dollars)
(Note 16)
Basic
$
2.35
$
1.55
Diluted
2.34
1.55
Dividends per common share
(Canadian dollars)
1.08
1.05
1
Includes $
18,724
million and $
20,746
million for the three months ended January 31, 2026 and January 31, 2025, respectively,
which have been calculated based on the effective interest
rate method (EIRM).
The accompanying Notes are an integral part of these Interim Consolidated Financial Statements.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 51
INTERIM CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
(unaudited)
(millions of Canadian dollars)
For the three months ended
January 31
January 31
2026
2025
Net income
$
4,043
$
2,793
Other comprehensive income (loss)
Items that will be subsequently reclassified
to net income
Net change in unrealized gain/(loss) on
financial assets at fair value
through other comprehensive income
Unrealized gain/(loss)
334
134
Reclassification to earnings of net loss/(gain)
(4)
9
Allowance for credit losses recognized in earnings
1
(1)
Income taxes relating to:
Unrealized gain/(loss)
(89)
(35)
Reclassification to earnings of net loss/(gain)
2
2
244
109
Net change in unrealized foreign currency
translation gain/(loss) on
investments in foreign operations, net
of hedging activities
Unrealized gain/(loss)
(3,552)
5,219
Reclassification to earnings of net loss/(gain)
–
–
Net gain/(loss) on hedges
2,410
(3,576)
Reclassification to earnings of net loss/(gain)
on hedges
–
–
Income taxes relating to:
Net gain/(loss) on hedges
(670)
993
Reclassification to earnings of net loss/(gain)
on hedges
–
–
(1,812)
2,636
Net change in gain/(loss) on derivatives
designated as cash flow hedges
Gain/(loss)
(1,959)
1,489
Reclassification to earnings of loss/(gain)
1,346
(1,184)
Income taxes relating to:
Gain/(loss)
509
(381)
Reclassification to earnings of loss/(gain)
(342)
281
(446)
205
Share of other comprehensive income (loss)
from investment in Schwab
–
(338)
Items that will not be subsequently reclassified
to net income
Remeasurement gain/(loss) on employee
benefit plans
Gain/(loss)
(69)
23
Income taxes
19
(5)
(50)
18
Change in net unrealized gain/(loss)
on equity securities designated at
fair value through other comprehensive income
Net unrealized gain/(loss)
29
14
Income taxes
(8)
(3)
21
11
Gain/(loss) from changes in fair value due
to own credit risk on
financial liabilities designated at fair value
through profit or loss
Gain/(loss)
(17)
(10)
Income taxes
4
3
(13)
(7)
Total other comprehensive income (loss)
(2,056)
2,634
Total comprehensive income (loss)
$
1,987
$
5,427
Available to:
Common shareholders
$
1,886
$
5,341
Preferred shareholders and other equity instrument
holders
101
86
The accompanying Notes are an integral part of these Interim Consolidated Financial Statements.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 52
INTERIM CONSOLIDATED STATEMENT
OF CHANGES IN EQUITY
(unaudited)
(millions of Canadian dollars)
For the three months ended
January 31, 2026
January 31, 2025
Common shares (Note 12)
Balance at beginning of period
$
24,727
$
25,373
Proceeds from shares issued on exercise of stock options
108
25
Shares issued as a result of dividend reinvestment plan
–
130
Purchase of shares for cancellation and other
(284)
–
Balance at end of period
24,551
25,528
Preferred shares and other equity instruments (Note 12)
Balance at beginning of period
11,625
10,888
Issuance of shares and other equity instruments
–
750
Redemption of shares and other equity instruments
–
(500)
Balance at end of period
11,625
11,138
Treasury – common shares (Note 12)
Balance at beginning of period
–
(17)
Purchase of shares
(3,314)
(3,504)
Sale of shares
3,309
3,483
Balance at end of period
(5)
(38)
Treasury – preferred shares and other equity instruments (Note 12)
Balance at beginning of period
(4)
(18)
Purchase of shares and other equity instruments
(162)
(1,120)
Sale of shares and other equity instruments
155
1,087
Balance at end of period
(11)
(51)
Contributed surplus
Balance at beginning of period
285
204
Net premium (discount) on sale of treasury instruments
6
(12)
Issuance of stock options, net of options exercised
13
–
Other
11
(3)
Balance at end of period
315
189
Retained earnings
Balance at beginning of period
78,320
70,826
Net income available to equity instrument holders
4,043
2,793
Common dividends
(1,811)
(1,836)
Preferred dividends and distributions on other equity instruments
(101)
(86)
Share and other equity instrument issue expenses
–
(2)
Net premium on repurchase of common shares and redemption of preferred shares and other
equity instruments
(Note 12)
(2,162)
–
Remeasurement gain/(loss) on employee benefit plans
(50)
18
Realized gain/(loss) on equity securities designated at fair value through
other comprehensive income
14
5
Balance at end of period
78,253
71,718
Accumulated other comprehensive income (loss)
Net unrealized gain/(loss) on financial assets at fair value through other comprehensive income:
Balance at beginning of period
283
(208)
Other comprehensive income (loss)
243
110
Allowance for credit losses
1
(1)
Balance at end of period
527
(99)
Net unrealized gain/(loss) on equity securities designated at fair value through
other comprehensive income:
Balance at beginning of period
146
35
Other comprehensive income (loss)
35
16
Reclassification of loss/(gain) to retained earnings
(14)
(5)
Balance at end of period
167
46
Gain/(loss) from changes in fair value due to own credit risk on financial liabilities
designated at fair value through profit or loss:
Balance at beginning of period
(28)
(22)
Other comprehensive income (loss)
(13)
(7)
Balance at end of period
(41)
(29)
Net unrealized foreign currency translation gain/(loss) on investments in foreign
operations, net of hedging activities:
Balance at beginning of period
13,242
12,893
Other comprehensive income (loss)
(1,812)
2,636
Balance at end of period
11,430
15,529
Net gain/(loss) on derivatives designated as cash flow hedges:
Balance at beginning of period
(769)
(2,924)
Other comprehensive income (loss)
(446)
205
Balance at end of period
(1,215)
(2,719)
Share of accumulated other comprehensive income (loss) from investment in Schwab
–
(2,208)
Total accumulated other comprehensive income
10,868
10,520
Total equity
$
125,596
$
119,004
The accompanying Notes are an integral part of these Interim Consolidated Financial Statements.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 53
INTERIM CONSOLIDATED STATEMENT
OF CASH FLOWS
(unaudited)
(millions of Canadian dollars)
For the three months ended
January 31
January 31
2026
2025
Cash flows from (used in) operating activities
Net income
$
4,043
$
2,793
Adjustments to determine net cash flows from (used in) operating
activities
Provision for (recovery of) credit losses
(Note 6)
1,039
1,212
Depreciation
338
345
Amortization of other intangibles
208
187
Net securities loss/(gain)
(Note 5)
(3)
920
Share of net income from investment in Schwab
(Note 7)
–
(231)
Deferred taxes
426
(70)
Changes in operating assets and liabilities
Interest receivable and payable
(Notes 8, 10)
(80)
(237)
Obligations related to securities sold under repurchase agreements
(7,368)
(8,044)
Securities purchased under reverse repurchase agreements
24,153
(13,902)
Obligations related to securities sold short
(2,340)
6,571
Trading loans, securities, and other
(14,752)
(23,085)
Loans net of securitization and sales
(6,527)
(17,124)
Deposits
(17,514)
18,592
Derivatives
3,740
825
Non-trading financial assets at fair value through profit or
loss
(1,030)
(941)
Financial assets and liabilities designated at fair value through
profit or loss
27,550
2,904
Securitization liabilities
296
1,149
Current income taxes
(103)
(1,581)
Amounts receivable and payable from brokers, dealers,
and clients
(7,776)
(3,979)
Other, including unrealized foreign currency
translation loss/(gain)
8,285
(16,583)
Net cash from (used in) operating activities
12,585
(50,279)
Cash flows from (used in) financing activities
Issuance of subordinated notes and debentures
(Note 11)
–
2,112
Redemption or repurchase of subordinated notes and
debentures
(Note 11)
(6)
(67)
Common shares issued, net of issuance costs
(Note 12)
98
22
Repurchase of common shares, including tax on net value
of share repurchases
(Note 12)
(2,446)
–
Preferred shares and other equity instruments issued,
net of issuance costs
(Note 12)
–
748
Redemption of preferred shares and other equity instruments
(Note 12)
–
(500)
Sale of treasury shares and other equity instruments
(Note 12)
3,470
4,558
Purchase of treasury shares and other equity instruments
(Note 12)
(3,476)
(4,624)
Dividends paid on shares and distributions paid on other equity
instruments
(141)
(1,792)
Repayment of lease liabilities
(163)
(169)
Net cash from (used in) financing activities
(2,664)
288
Cash flows from (used in) investing activities
Interest-bearing deposits with banks
(6,928)
39,040
Activities in financial assets at fair value through other comprehensive
income
Purchases
(12,012)
(20,977)
Proceeds from maturities
7,278
8,306
Proceeds from sales
482
840
Activities in debt securities at amortized cost
Purchases
(12,045)
(7,133)
Proceeds from maturities
12,746
12,590
Proceeds from sales
47
17,752
Net purchases of land, buildings, equipment, other depreciable
assets, and other intangibles
(531)
(497)
Net cash from (used in) investing activities
(10,963)
49,921
Effect of exchange rate changes on cash and
due from banks
(183)
185
Net increase (decrease) in cash and due from banks
(1,225)
115
Cash and due from banks at beginning of period
7,512
6,437
Cash and due from banks at end of period
$
6,287
$
6,552
Supplementary disclosure of cash flows from operating
activities
Amount of income taxes paid (refunded) during the period
$
1,497
$
1,321
Amount of interest paid during the period
12,014
15,478
Amount of interest received during the period
20,091
22,584
Amount of dividends received during the period
643
626
The accompanying Notes are an integral part of these Interim Consolidated Financial Statements.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 54
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
NOTE 1: NATURE OF OPERATIONS
CORPORATE INFORMATION
The Toronto-Dominion Bank is a bank chartered under the
Bank Act (Canada)
. The shareholders of a bank are not, as
shareholders, liable for any liability, act, or
default of the bank except as otherwise provided
under the
Bank Act (Canada)
. The Toronto-Dominion Bank and its subsidiaries are collectively known
as
TD Bank Group (“TD” or the “Bank”). The Bank
was formed through the amalgamation on
February 1, 1955,
of The Bank of Toronto (chartered in 1855) and The
Dominion Bank (chartered in 1869). The Bank
is incorporated and domiciled in Canada
with its registered and principal business
offices located at 66 Wellington
Street West, Toronto, Ontario. TD serves customers in four business segments
operating in a number of locations in key
financial centres around the globe:
Canadian Personal and Commercial
Banking, U.S. Banking, Wealth Management and Insurance,
and Wholesale Banking.
BASIS OF PREPARATION
The accompanying Interim Consolidated
Financial Statements have been prepared
on a condensed basis in accordance with
International Accounting Standards
34,
Interim Financial Reporting
(IAS 34), as issued by the International
Accounting Standards Board (IASB) and
with the accounting policies as described in
Note 2
of the Bank’s 2025 Annual Consolidated Financial
Statements, including the accounting requirements
of the Office of the Superintendent of Financial
Institutions
Canada (OSFI), which were consistently
applied to all periods presented.
The Interim Consolidated Financial Statements
are presented in Canadian dollars,
unless otherwise indicated.
Certain comparative amounts have been
revised to conform with the presentation adopted
in the current period.
The preparation of the Interim Consolidated
Financial Statements requires that management
make judgments, estimates, and assumptions
regarding the
reported amount of assets, liabilities, revenue
and expenses, and disclosure of contingent
assets and liabilities, as further described in
Note 3 of the Bank’s 2025
Annual Consolidated Financial Statements
and in Note 3 of this report. Accordingly, actual results may differ from estimated
amounts as future confirming events
occur.
The Bank’s Interim Consolidated Financial Statements
have been prepared using uniform accounting
policies for like transactions and events in
similar
circumstances. All intercompany transactions,
balances,
and unrealized gains and losses on
transactions are eliminated on consolidation.
The Interim Consolidated Financial Statements
for the three months ended January
31, 2026, were approved and authorized
for issue by the Bank’s Board of
Directors on February 25, 2026,
in accordance with a recommendation of
the Audit Committee.
As the Interim Consolidated Financial Statements
do not include all of the disclosures normally
provided in the Annual Consolidated Financial
Statements, they
should be read in conjunction with the Bank’s 2025
Annual Consolidated Financial Statements
and the accompanying Notes, and
the shaded sections of the 2025
Management’s Discussion and Analysis (MD&A).
The risk management policies and procedures
of the Bank are provided in the MD&A.
The shaded sections of
the “Managing Risk” section of the MD&A in
this report,
relating to market, liquidity, and insurance risks, are an integral
part of these Interim Consolidated Financial
Statements, as permitted by International
Financial Reporting Standards.
NOTE 2: CURRENT AND FUTURE
CHANGES IN ACCOUNTING POLICIES
CURRENT CHANGES IN ACCOUNTING
POLICIES
There were no new accounting policies adopted
by the Bank for the three months ended
January 31, 2026.
FUTURE CHANGES IN ACCOUNTING
POLICIES
There were no new accounting standards
or amendments issued during the three
months ended January 31, 2026. Refer to Note
4 of the Bank’s 2025 Annual
Consolidated Financial Statements for a description
of future changes in accounting policies.
NOTE 3: SIGNIFICANT ACCOUNTING
JUDGMENTS, ESTIMATES, AND ASSUMPTIONS
The estimates used in the Bank’s accounting policies
are essential to understanding its results
of operations and financial condition. Some
of the Bank’s policies
require subjective, complex judgments and
estimates as they relate to matters
that are inherently uncertain. Changes in these judgments
or estimates and
changes to accounting standards and policies
could have a materially adverse impact on
the Bank’s Interim Consolidated Financial
Statements. The Bank has
established procedures to ensure that accounting
policies are applied consistently and that the
processes for changing methodologies,
determining estimates, and
adopting new accounting standards are well-controlled
and occur in an appropriate and systematic
manner. Refer to Note 3 of the Bank’s 2025
Annual
Consolidated Financial Statements for a description
of significant accounting judgments, estimates,
and assumptions.
Impairment – Expected Credit Loss Model
The expected credit loss (ECL) model requires
the application of judgments, estimates,
and assumptions in the assessment of the
current and forward-looking
economic environment. There remains elevated
economic uncertainty, and management continues to exercise
expert credit judgment in assessing if an
exposure
has experienced significant increase in credit
risk since initial recognition and in determining
the amount of ECLs at each reporting date.
To the extent that certain
effects are not fully incorporated into the model
calculations, temporary quantitative and qualitative
adjustments have been applied,
including for risks related to
elevated uncertainty associated with policy and
trade, and such adjustments will be updated
as appropriate in future periods.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 55
NOTE 4: FAIR VALUE MEASUREMENTS
There have been no significant changes to
the Bank’s approach and methodologies used
to determine fair value measurements for
the three months ended
January 31, 2026.
(a)
FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES NOT CARRIED AT FAIR VALUE
The following table reflects the fair value
of the Bank’s financial assets and liabilities not
carried at fair value.
Financial Assets and Liabilities not carried
at Fair Value
1
(millions of Canadian dollars)
As at
January 31, 2026
October 31, 2025
Carrying
Fair
Carrying
Fair
value
value
value
value
FINANCIAL ASSETS
Debt securities at amortized cost, net of allowance
for credit losses
Government and government-related
securities
$
176,562
$
176,063
$
183,593
$
182,478
Other debt securities
57,708
57,695
56,846
56,679
Total debt securities at amortized cost, net of allowance for credit losses
234,270
233,758
240,439
239,157
Total loans, net of allowance for loan losses
958,486
961,507
953,012
956,424
Total financial assets not carried at fair value
$
1,192,756
$
1,195,265
$
1,193,451
$
1,195,581
FINANCIAL LIABILITIES
Deposits
$
1,245,144
$
1,245,666
$
1,267,104
$
1,267,466
Securitization liabilities at amortized
cost
15,021
15,029
14,841
14,805
Subordinated notes and debentures
10,642
10,770
10,733
10,929
Total financial liabilities not carried at fair value
$
1,270,807
$
1,271,465
$
1,292,678
$
1,293,200
1
This table excludes financial assets and liabilities where the carrying value approximates their fair value.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 56
(b)
FAIR VALUE HIERARCHY
The following table presents the levels within
the fair value hierarchy for each of the assets
and liabilities measured at fair value on a
recurring basis as at
January 31, 2026 and October 31, 2025.
Fair Value Hierarchy for Assets and Liabilities Measured at Fair Value on a Recurring Basis
(millions of Canadian dollars)
As at
January 31, 2026
October 31, 2025
Level 1
Level 2
Level 3
Total
Level 1
Level 2
Level 3
Total
FINANCIAL ASSETS AND COMMODITIES
Trading loans, securities, and other
1
Government and government-related securities
Canadian government debt
Federal
$
3,860
$
3,358
$
–
$
7,218
$
4,892
$
3,875
$
–
$
8,767
Provinces
–
5,678
–
5,678
–
4,537
–
4,537
U.S. federal, state, municipal governments,
and agencies debt
2,352
23,422
–
25,774
2,973
20,811
–
23,784
Other OECD
2
government-guaranteed debt
238
7,188
–
7,426
283
5,818
–
6,101
Mortgage-backed securities
–
766
–
766
–
768
–
768
Other debt securities
Canadian issuers
–
6,223
66
6,289
–
6,695
67
6,762
Other issuers
–
19,561
1
19,562
–
16,508
–
16,508
Equity securities
98,186
278
23
98,487
87,713
171
25
87,909
Trading loans
–
28,859
179
29,038
–
30,032
–
30,032
Commodities
32,503
2,146
–
34,649
33,446
1,521
–
34,967
Retained interests
–
1
–
1
–
1
–
1
137,139
97,480
269
234,888
129,307
90,737
92
220,136
Non-trading financial assets at fair value
through profit or loss
Securities
431
5,577
1,622
7,630
465
5,019
1,567
7,051
Loans
–
795
–
795
–
344
–
344
431
6,372
1,622
8,425
465
5,363
1,567
7,395
Derivatives
Interest rate contracts
1
7,074
10
7,085
6
10,990
8
11,004
Foreign exchange contracts
99
54,103
–
54,202
30
53,576
3
53,609
Credit contracts
–
80
–
80
–
44
–
44
Equity contracts
152
12,856
–
13,008
162
12,534
–
12,696
Commodity and other contracts
2,249
6,732
15
8,996
752
4,867
–
5,619
2,501
80,845
25
83,371
950
82,011
11
82,972
Financial assets designated at
fair value through profit or loss
Securities
1
–
7,038
–
7,038
–
6,986
–
6,986
–
7,038
–
7,038
–
6,986
–
6,986
Financial assets at fair value through other
comprehensive income
Government and government-related securities
Canadian government debt
Federal
4
16,018
–
16,022
100
15,791
–
15,891
Provinces
–
20,908
–
20,908
–
21,080
–
21,080
U.S. federal, state, municipal governments,
and agencies debt
830
55,189
–
56,019
851
53,641
–
54,492
Other OECD government-guaranteed debt
–
8,023
–
8,023
–
7,875
–
7,875
Mortgage-backed securities
–
1,748
–
1,748
–
1,896
–
1,896
Other debt securities
Asset-backed securities
–
8,616
–
8,616
–
8,709
–
8,709
Corporate and other debt
–
12,752
–
12,752
–
13,091
–
13,091
Equity securities
1,145
2
2,159
3,306
1,136
–
1,911
3,047
Loans
–
478
–
478
–
288
–
288
1,979
123,734
2,159
127,872
2,087
122,371
1,911
126,369
Securities purchased under reverse
repurchase agreements
–
7,406
–
7,406
–
7,574
–
7,574
FINANCIAL LIABILITIES
Trading deposits
–
42,104
224
42,328
–
37,609
273
37,882
Derivatives
Interest rate contracts
2
6,948
72
7,022
6
9,572
76
9,654
Foreign exchange contracts
136
46,037
1
46,174
24
42,496
5
42,525
Credit contracts
–
423
–
423
–
440
–
440
Equity contracts
–
19,096
120
19,216
–
19,528
155
19,683
Commodity and other contracts
2,806
7,822
32
10,660
806
6,193
55
7,054
2,944
80,326
225
83,495
836
78,229
291
79,356
Securitization liabilities at fair value
–
25,399
–
25,399
–
25,283
–
25,283
Financial liabilities designated at fair value
through profit or loss
–
225,237
–
225,237
–
197,633
2
197,635
Obligations related to securities sold short
1
12,578
28,877
–
41,455
15,342
28,453
–
43,795
Obligations related to securities sold
under repurchase agreements
–
11,531
–
11,531
–
11,557
–
11,557
1
Balances reflect the reduction of securities owned (long positions) by the amount of identical securities sold but
not yet purchased (short positions).
2
Organisation for Economic Co-operation and Development (OECD).
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 57
(c)
TRANSFERS BETWEEN FAIR VALUE HIERARCHY LEVELS FOR ASSETS
AND LIABILITIES MEASURED AT FAIR VALUE ON A RECURRING BASIS
The Bank’s policy is to record transfers of assets
and liabilities between the different levels of
the fair value hierarchy using the fair values
as at the end of each
reporting period. Assets and liabilities are
transferred between Level 1 and Level 2
depending on whether there is sufficient frequency
and volume in an active
market.
During the three months ended January 31,
2026, the Bank transferred $
1,752
million of trading loans, securities, and other, $
2
million of financial assets at fair
value through other comprehensive income
(FVOCI), and $
1,062
million of obligations related to securities
sold short from Level 2 to Level 1. During
the three
months ended January 31, 2026, the Bank
transferred $
2,828
million of trading loans, securities, and other, $
510
million of financial assets at FVOCI, and
$
2,165
million of obligations related to securities sold
short from Level 1 to Level 2. There were no
significant transfers between Level 1 and
Level 2 during the
three months ended January 31, 2025.
There were no significant transfers between
Level 2 and Level 3 during the three
months ended January 31, 2026 and January
31, 2025.
There were no significant changes to the unobservable
inputs and sensitivities for assets and liabilities
classified as Level 3 during the three
months ended
January 31, 2026 and January 31, 2025.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 58
(d)
RECONCILIATION OF CHANGES IN FAIR VALUE FOR LEVEL 3 ASSETS AND LIABILITIES
The following tables set out changes in fair
value of all assets and liabilities measured
at fair value using significant Level 3 unobservable
inputs for the three
months ended January 31, 2026 and January
31, 2025.
Reconciliation of Changes in Fair Value for Level 3 Assets and Liabilities
(millions of Canadian dollars)
Change in
unrealized
Fair
Total realized and
Fair
gains
value as at
unrealized gains (losses)
Movements
1
Transfers
value as at
(losses) on
November 1
Included
Included
Purchases/
Sales/
Into
Out of
January 31
instruments
2025
in income
2
in OCI
3,4
Issuances
Settlements
Level 3
Level 3
2026
still held
5
FINANCIAL ASSETS
Trading loans, securities,
and other
Other debt securities
$
67
$
1
$
–
$
–
$
(4)
$
3
$
–
$
67
$
(4)
Equity securities
25
(2)
–
–
–
–
–
23
–
Trading loans
–
(114)
–
293
–
–
–
179
92
(115)
–
293
(4)
3
–
269
(4)
Non-trading financial
assets at fair value
through profit or loss
Securities
1,567
4
(4)
69
(14)
–
–
1,622
1
1,567
4
(4)
69
(14)
–
–
1,622
1
Financial assets at fair value
through other
comprehensive income
Other debt securities
–
–
–
–
–
–
–
–
–
Equity securities
1,911
–
1
309
(62)
–
–
2,159
3
$
1,911
$
–
$
1
$
309
$
(62)
$
–
$
–
$
2,159
$
3
FINANCIAL LIABILITIES
Trading deposits
6
$
(273)
$
21
$
–
$
–
$
21
$
–
$
7
$
(224)
$
24
Derivatives
7
Interest rate contracts
(68)
5
–
–
1
–
–
(62)
–
Foreign exchange contracts
(2)
4
–
–
–
–
(3)
(1)
–
Equity contracts
(155)
2
–
–
(1)
1
33
(120)
–
Commodity and other contracts
(55)
39
–
–
(1)
–
–
(17)
–
(280)
50
–
–
(1)
1
30
(200)
–
Financial liabilities designated
at fair value
through profit or loss
(2)
5
–
(6)
3
–
–
–
5
Reconciliation of Changes in Fair Value for Level 3 Assets and Liabilities
(millions of Canadian dollars)
Change in
unrealized
Fair
Total realized and
Fair
gains
value as at
unrealized gains (losses)
Movements
1
Transfers
value as at
(losses) on
November 1
Included
Included
Purchases/
Sales/
Into
Out of
January 31
instruments
2024
in income
2
in OCI
4
Issuances
Settlements
Level 3
Level 3
2025
still held
5
FINANCIAL ASSETS
Trading loans, securities,
and other
Other debt securities
$
26
$
–
$
–
$
–
$
(15)
$
–
$
–
$
11
$
(1)
Equity securities
12
2
–
1
(7)
–
–
8
–
38
2
–
1
(22)
–
–
19
(1)
Non-trading financial
assets at fair value
through profit or loss
Securities
1,233
30
–
43
(19)
–
–
1,287
7
1,233
30
–
43
(19)
–
–
1,287
7
Financial assets at fair value
through other
comprehensive income
Other debt securities
7
–
–
–
(4)
–
–
3
–
Equity securities
3,355
–
–
2
(183)
–
–
3,174
–
$
3,362
$
–
$
–
$
2
$
(187)
$
–
$
–
$
3,177
$
–
FINANCIAL LIABILITIES
Trading deposits
6
$
(505)
$
4
$
–
$
(72)
$
114
$
–
$
–
$
(459)
$
6
Derivatives
7
Interest rate contracts
(158)
(6)
–
–
9
–
–
(155)
2
Foreign exchange contracts
1
6
–
–
5
7
2
21
11
Equity contracts
(24)
(5)
–
–
(1)
1
–
(29)
(7)
Commodity and other contracts
(10)
6
–
–
–
–
–
(4)
7
(191)
1
–
–
13
8
2
(167)
13
Financial liabilities designated
at fair value through profit
or loss
(24)
–
–
(6)
29
–
–
(1)
–
1
Includes foreign exchange.
2
Gains/losses on financial assets and liabilities are recognized within Non-interest Income on the Interim Consolidated
Statement of Income.
3
Other comprehensive income (OCI).
4
Includes realized gains/losses transferred to retained earnings on disposal of equities designated at FVOCI. Refer
to Note 5 for further details.
5
Changes in unrealized gains/losses on financial assets at FVOCI are recognized in accumulated other comprehensive
income (AOCI).
6
Issuances and repurchases of trading deposits are reported on a gross basis.
7
Consists of derivative assets of $
25
million (January 31, 2025 – $
38
million; October 31, 2025/November 1, 2025 – $
11
million; October 31, 2024/November 1, 2024 – $
30
million) and
derivative liabilities of $
225
million (January 31, 2025 – $
205
million; October 31, 2025/November 1, 2025 – $
291
million; October 31, 2024/November 1, 2024 – $
221
million) which have
been netted in this table for presentation purposes only.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 59
NOTE 5: SECURITIES
(a)
UNREALIZED SECURITIES GAINS (LOSSES)
The following table summarizes the unrealized
gains and losses as at January 31, 2026
and October 31, 2025.
Unrealized Gains (Losses) for Securities
at Fair Value Through Other Comprehensive Income
(millions of Canadian dollars)
As at
January 31, 2026
October 31, 2025
Cost/
Gross
Gross
Cost/
Gross
Gross
amortized
unrealized
unrealized
Fair
amortized
unrealized
unrealized
Fair
cost
1
gains
(losses)
value
cost
1
gains
(losses)
value
Government and government-related
securities
Canadian government debt
Federal
$
16,019
$
60
$
(57)
$
16,022
$
15,956
$
23
$
(88)
$
15,891
Provinces
20,681
229
(2)
20,908
20,971
120
(11)
21,080
U.S. federal, state, municipal governments, and
agencies debt
55,704
353
(38)
56,019
54,279
267
(54)
54,492
Other OECD government-guaranteed debt
7,998
25
–
8,023
7,864
15
(4)
7,875
Mortgage-backed securities
1,728
21
(1)
1,748
1,869
29
(2)
1,896
102,130
688
(98)
102,720
100,939
454
(159)
101,234
Other debt securities
Asset-backed securities
8,608
20
(12)
8,616
8,713
11
(15)
8,709
Corporate and other debt
12,673
103
(24)
12,752
13,011
106
(26)
13,091
21,281
123
(36)
21,368
21,724
117
(41)
21,800
Total debt securities
123,411
811
(134)
124,088
122,663
571
(200)
123,034
Equity securities
Common shares
2,452
252
(25)
2,679
2,332
226
(22)
2,536
Preferred shares
630
76
(79)
627
523
67
(79)
511
3,082
328
(104)
3,306
2,855
293
(101)
3,047
Total securities at fair value through
other comprehensive income
$
126,493
$
1,139
$
(238)
$
127,394
$
125,518
$
864
$
(301)
$
126,081
1
Includes the foreign exchange translation of amortized cost balances at the period-end spot rate.
(b)
EQUITY SECURITIES DESIGNATED AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME
The Bank designated certain equity securities
at FVOCI.
The following table summarizes the fair
value of equity securities designated at
FVOCI as at
January 31, 2026
and October 31, 2025, and dividend income
recognized on these securities for
the three months ended January 31, 2026 and
January 31, 2025.
Equity Securities Designated at Fair Value Through
Other Comprehensive Income
(millions of Canadian dollars)
As at
For the three months ended
January 31, 2026
October 31, 2025
January 31, 2026
January 31, 2025
Fair value
Dividend income recognized
Common shares
$
2,679
$
2,536
$
20
$
27
Preferred shares
627
511
36
39
Total
$
3,306
$
3,047
$
56
$
66
The Bank disposed of certain equity securities
in line with the Bank’s investment strategy
and disposed of Federal Home Loan Bank (FHLB)
stock in accordance
with FHLB member stockholding requirements,
as follows:
Equity Securities Net Realized Gains
(Losses)
(millions of Canadian dollars)
For the three months ended
January 31, 2026
January 31, 2025
Equity Securities
Fair value
$
91
$
64
Cumulative realized gain/(loss)
19
6
FHLB Stock
Fair value
10
318
Cumulative realized gain/(loss)
–
–
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 60
(c)
DEBT SECURITIES NET REALIZED GAINS
(LOSSES)
The Bank disposed of certain debt securities
measured at amortized cost and FVOCI
during the quarter.
The following table summarizes the net realized
gains
and losses on securities disposed of during
the three months ended January 31, 2026 and
January 31, 2025, which are included in
Other income (loss) on the
Interim Consolidated Statement of Income.
Debt Securities Net Realized Gains (Losses)
(millions of Canadian dollars)
For the three months ended
January 31, 2026
January 31, 2025
1
Debt securities at amortized cost
$
(1)
$
(911)
Debt securities at fair value through other
comprehensive income
4
(9)
Total
$
3
$
(920)
1
Includes $
923
million (US$
649
million) of pre-tax losses on debt securities related to the balance sheet restructuring initiative undertaken
in the U.S. Banking segment. Refer to Note 25 of
the Bank’s 2025 Annual Consolidated Financial Statements for additional information regarding the
asset limitation on TD’s two U.S. bank subsidiaries.
(d)
CREDIT QUALITY OF DEBT SECURITIES
The Bank evaluates non-retail credit risk
on an individual borrower basis, using both
a borrower risk rating (BRR) and facility
risk rating, as detailed in the shaded
area of the “Managing Risk” section of the 2025
MD&A. This system is used to assess all non-retail
exposures, including debt securities.
The following table provides the gross carrying
amounts of debt securities measured at amortized
cost and debt securities at FVOCI by internal
risk rating for credit
risk management purposes, presenting
separately those debt securities that are
subject to Stage 1, Stage 2, and Stage 3
allowances. Refer to the “Allowance
for
Credit Losses” table in Note 6 for details regarding
the allowance and provision for credit losses
on debt securities.
Debt Securities by Risk Rating
(millions of Canadian dollars)
As at
January 31, 2026
October 31, 2025
Stage 1
Stage 2
Stage 3
Total
Stage 1
Stage 2
Stage 3
Total
Debt securities
1
Investment grade
$
357,354
$
–
$
n/a
2
$
357,354
$
362,521
$
–
$
n/a
$
362,521
Non-investment grade
881
80
n/a
961
738
167
n/a
905
Watch and classified
n/a
45
n/a
45
n/a
49
n/a
49
Default
n/a
n/a
–
–
n/a
n/a
–
–
Total debt securities
358,235
125
–
358,360
363,259
216
–
363,475
Allowance for credit losses on debt securities
at amortized cost
2
–
–
2
2
–
–
2
Total debt securities, net of
allowance
$
358,233
$
125
$
–
$
358,358
$
363,257
$
216
$
–
$
363,473
1
Includes debt securities backed by government-guaranteed loans of $
84
million (October 31, 2025 – $
94
million), which are reported in Non-investment grade or a lower risk rating based
on the issuer’s credit risk.
2
Not applicable.
As at January 31, 2026, total debt securities,
net of allowance, in the table above, include
debt securities measured at amortized cost,
net of allowance, of
$
234,270
million (October 31, 2025 – $
240,439
million), and debt securities measured at
FVOCI of $
124,088
million (October 31, 2025 – $
123,034
million). The
difference between probability-weighted ECLs
and base ECLs on debt securities at
FVOCI and at amortized cost as at both
January 31, 2026 and
October 31, 2025, was insignificant.
NOTE 6: LOANS, IMPAIRED LOANS, AND ALLOWANCE FOR CREDIT LOSSES
(a)
LOANS
The following table provides details regarding
the Bank’s loans as at January 31, 2026 and October
31, 2025.
Loans
(millions of Canadian dollars)
As at
January 31, 2026
October 31, 2025
Residential mortgages
$
308,151
$
315,063
Consumer instalment and other personal
266,630
259,033
Credit card
41,070
41,662
Business and government
351,201
345,943
967,052
961,701
Loans at FVOCI
1
478
288
Total loans
967,530
961,989
Total allowance for loan losses
8,567
8,689
Total loans, net of allowance
$
958,963
$
953,300
1
Included in Financial assets at fair value through other comprehensive income on the Interim Consolidated Balance
Sheet.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 61
Business and government loans and loans
at FVOCI are grouped together as reflected
below for presentation in the “Loans by
Risk Ratings” table.
Loans – Business and Government
(millions of Canadian dollars)
As at
January 31, 2026
October 31, 2025
Loans at amortized cost
$
351,201
$
345,943
Loans at FVOCI
1
478
288
Loans
351,679
346,231
Allowance for loan losses
3,737
3,847
Loans, net of allowance
$
347,942
$
342,384
1
Included in Financial assets at fair value through other comprehensive income on the Interim Consolidated Balance
Sheet.
(b)
CREDIT QUALITY OF LOANS
In the retail portfolio, including individuals and
small businesses, the Bank manages exposures
on a pooled basis, using predictive credit
scoring techniques. For
non-retail exposures, each borrower is assigned
a BRR that reflects the probability of default
(PD)
of the borrower using proprietary industry
and sector specific
risk models and expert judgment. Refer to
the shaded areas of the “Managing Risk”
section of the 2025 MD&A for further
details, including the mapping of PD
ranges to risk levels for retail exposures
as well as the Bank’s 21-point BRR scale
to risk levels and external ratings for non-retail
exposures.
The following table provides the gross carrying
amounts of loans and credit risk exposures
on loan commitments and financial guarantee
contracts by internal risk
rating for credit risk management purposes,
presenting separately those that are
subject to Stage 1, Stage 2, and Stage 3
allowances.
Loans by Risk Rating
(millions of Canadian dollars)
As at
January 31, 2026
October 31, 2025
Stage 1
Stage 2
Stage 3
Total
Stage 1
Stage 2
Stage 3
Total
Residential mortgages
1,2,3
Low Risk
$
211,463
$
882
$
n/a
$
212,345
$
221,168
$
765
$
n/a
$
221,933
Normal Risk
71,559
8,746
n/a
80,305
70,217
8,391
n/a
78,608
Medium Risk
403
10,071
n/a
10,474
351
9,490
n/a
9,841
High Risk
7
3,994
379
4,380
3
3,700
391
4,094
Default
n/a
n/a
647
647
n/a
n/a
587
587
Total loans
283,432
23,693
1,026
308,151
291,739
22,346
978
315,063
Allowance for loan losses
103
194
86
383
102
175
80
357
Loans, net of allowance
283,329
23,499
940
307,768
291,637
22,171
898
314,706
Consumer instalment and other personal
4
Low Risk
115,290
2,569
n/a
117,859
110,513
2,588
n/a
113,101
Normal Risk
82,582
15,797
n/a
98,379
75,881
19,812
n/a
95,693
Medium Risk
29,966
6,610
n/a
36,576
29,757
6,792
n/a
36,549
High Risk
5,844
6,858
458
13,160
5,407
7,209
448
13,064
Default
n/a
n/a
656
656
n/a
n/a
626
626
Total loans
233,682
31,834
1,114
266,630
221,558
36,401
1,074
259,033
Allowance for loan losses
699
1,163
275
2,137
699
1,220
274
2,193
Loans, net of allowance
232,983
30,671
839
264,493
220,859
35,181
800
256,840
Credit card
Low Risk
7,870
4
n/a
7,874
8,011
4
n/a
8,015
Normal Risk
11,933
111
n/a
12,044
12,222
119
n/a
12,341
Medium Risk
12,598
915
n/a
13,513
12,780
902
n/a
13,682
High Risk
2,676
4,395
411
7,482
2,727
4,329
419
7,475
Default
n/a
n/a
157
157
n/a
n/a
149
149
Total loans
35,077
5,425
568
41,070
35,740
5,354
568
41,662
Allowance for loan losses
754
1,105
451
2,310
743
1,089
460
2,292
Loans, net of allowance
34,323
4,320
117
38,760
34,997
4,265
108
39,370
Business and government
1,2,3,5
Investment grade or Low/Normal Risk
142,625
127
n/a
142,752
139,518
152
n/a
139,670
Non-investment grade or Medium Risk
177,762
12,616
n/a
190,378
173,836
13,289
n/a
187,125
Watch and classified or High Risk
531
15,132
90
15,753
538
16,098
77
16,713
Default
n/a
n/a
2,796
2,796
n/a
n/a
2,723
2,723
Total loans
320,918
27,875
2,886
351,679
313,892
29,539
2,800
346,231
Allowance for loan losses
1,167
1,688
882
3,737
1,195
1,878
774
3,847
Loans, net of allowance
319,751
26,187
2,004
347,942
312,697
27,661
2,026
342,384
Total loans
873,109
88,827
5,594
967,530
862,929
93,640
5,420
961,989
Total allowance for loan losses
2,723
4,150
1,694
8,567
2,739
4,362
1,588
8,689
Total loans, net of allowance
$
870,386
$
84,677
$
3,900
$
958,963
$
860,190
$
89,278
$
3,832
$
953,300
1
Includes impaired loans with a balance of $
288
million (October 31, 2025 – $
273
million) which did not have a related allowance for loan losses as the realizable value of the collateral
exceeded the loan amount.
2
Excludes trading loans and non-trading loans at fair value through profit or loss (FVTPL) with a fair value of $
29
billion (October 31, 2025 – $
30
billion) and $
0.8
billion (October 31, 2025
– $
0.3
billion), respectively.
3
Includes insured mortgages of $
68
billion (October 31, 2025 – $
69
billion).
4
Includes Canadian government-insured real estate personal loans of $
5
billion (October 31, 2025 – $
5
billion).
5
Includes loans guaranteed by government agencies of $
24
billion (October 31, 2025 – $
24
billion), which are primarily reported in Non-investment grade or a lower risk rating based on
the borrowers’ credit risk.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 62
Loans by Risk Rating
(Continued)
– Off-Balance Sheet Credit Instruments
1
(millions of Canadian dollars)
As at
January 31, 2026
October 31, 2025
Stage 1
Stage 2
Stage 3
Total
Stage 1
Stage 2
Stage 3
Total
Retail Exposures
2
Low Risk
$
317,097
$
1,300
$
n/a
$
318,397
$
318,759
$
1,464
$
n/a
$
320,223
Normal Risk
63,899
1,086
n/a
64,985
62,564
1,147
n/a
63,711
Medium Risk
16,259
1,177
n/a
17,436
16,381
1,295
n/a
17,676
High Risk
1,331
1,101
–
2,432
1,282
1,092
–
2,374
Default
n/a
n/a
–
–
n/a
n/a
–
–
Non-Retail Exposures
3
Investment grade
321,807
–
n/a
321,807
319,274
–
n/a
319,274
Non-investment grade
104,910
5,629
n/a
110,539
103,936
5,710
n/a
109,646
Watch and classified
538
4,532
–
5,070
150
4,905
–
5,055
Default
n/a
n/a
399
399
n/a
n/a
343
343
Total off-balance sheet credit
instruments
825,841
14,825
399
841,065
822,346
15,613
343
838,302
Allowance for off-balance sheet credit
instruments
469
555
6
1,030
470
566
16
1,052
Total off-balance sheet credit
instruments, net of allowance
$
825,372
$
14,270
$
393
$
840,035
$
821,876
$
15,047
$
327
$
837,250
1
Excludes mortgage commitments.
2
Includes $
401
billion (October 31, 2025 – $
401
billion) of personal lines of credit and credit card lines, which are unconditionally cancellable at the Bank’s
discretion at any time.
3
Includes $
66
billion (October 31, 2025 – $
67
billion) of the undrawn component of uncommitted credit and liquidity facilities.
(c)
ALLOWANCE FOR CREDIT LOSSES
The following table provides details on
the Bank’s allowance for credit losses as at and
for the three months ended January 31,
2026
and January 31, 2025,
including allowance for off-balance sheet instruments
in the applicable categories.
Allowance for Credit Losses
(millions of Canadian dollars)
Foreign
Foreign
exchange,
exchange,
Balance at
Provision
Write-offs,
disposals,
Balance
Balance at
Provision
Write-offs,
disposals,
Balance
beginning
for credit
net of
and other
at end of
beginning
for credit
net of
and other
at end of
of period
losses
recoveries
adjustments
period
of period
losses
recoveries
adjustments
period
For the three months ended
January 31, 2026
January 31, 2025
Residential mortgages
$
357
$
31
$
(3)
$
(2)
$
383
$
365
$
(1)
$
(1)
$
5
$
368
Consumer instalment and other
personal
2,273
301
(343)
(24)
2,207
2,133
356
(334)
34
2,189
Credit card
2,790
483
(420)
(57)
2,796
2,699
450
(436)
84
2,797
Business and government
4,321
224
(236)
(98)
4,211
3,940
407
(186)
79
4,240
Total allowance for loan losses,
including off-balance sheet
instruments
9,741
1,039
(1,002)
(181)
9,597
9,137
1,212
(957)
202
9,594
Debt securities at amortized cost
2
–
–
–
2
3
–
–
–
3
Debt securities at FVOCI
2
–
–
–
2
1
–
–
–
1
Total allowance for credit
losses on debt securities
4
–
–
–
4
4
–
–
–
4
Total allowance for credit losses
$
9,745
$
1,039
$
(1,002)
$
(181)
$
9,601
$
9,141
$
1,212
$
(957)
$
202
$
9,598
Comprising:
Allowance for credit losses on
loans at amortized cost
$
8,689
$
8,566
$
8,094
$
8,654
Allowance for credit losses on
loans at FVOCI
–
1
–
1
Allowance for loan losses
8,689
8,567
8,094
8,655
Allowance for off-balance sheet
instruments
1,052
1,030
1,043
939
Allowance for credit losses on
debt securities
4
4
4
4
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 63
(d)
ALLOWANCE FOR LOAN LOSSES BY STAGE
The following table provides details on
the Bank’s allowance for loan losses by
stage as at and for the three months ended
January 31, 2026 and
January 31, 2025.
Allowance for Loan Losses by Stage
(millions of Canadian dollars)
For the three months ended
January 31, 2026
January 31, 2025
Stage 1
Stage 2
Stage 3
Total
Stage 1
Stage 2
Stage 3
Total
Residential Mortgages
Balance at beginning of period
$
102
$
175
$
80
$
357
$
116
$
189
$
60
$
365
Provision for credit losses
Transfer to Stage 1
1
24
(23)
(1)
–
35
(34)
(1)
–
Transfer to Stage 2
(8)
15
(7)
–
(6)
11
(5)
–
Transfer to Stage 3
–
(10)
10
–
–
(11)
11
–
Net remeasurement due to transfers into stage
2
(6)
5
–
(1)
(7)
4
–
(3)
New originations or purchases
3
6
n/a
n/a
6
7
n/a
n/a
7
Net repayments
4
(1)
(1)
–
(2)
(1)
(1)
–
(2)
Derecognition of financial assets (excluding
disposals and write-offs)
5
(1)
(5)
(9)
(15)
(4)
(4)
(6)
(14)
Changes to risk, parameters, and models
6
(12)
38
17
43
(28)
26
13
11
Disposals
–
–
–
–
–
–
–
–
Write-offs
–
–
(4)
(4)
–
–
(1)
(1)
Recoveries
–
–
1
1
–
–
–
–
Foreign exchange and other adjustments
(1)
–
(1)
(2)
2
1
2
5
Balance at end of period
$
103
$
194
$
86
$
383
$
114
$
181
$
73
$
368
Consumer Instalment and Other Personal
Balance, including off-balance sheet instruments,
at beginning of period
$
724
$
1,275
$
274
$
2,273
$
696
$
1,175
$
262
$
2,133
Provision for credit losses
Transfer to Stage 1
1
202
(201)
(1)
–
185
(184)
(1)
–
Transfer to Stage 2
(60)
80
(20)
–
(64)
87
(23)
–
Transfer to Stage 3
(3)
(78)
81
–
(3)
(73)
76
–
Net remeasurement due to transfers into stage
2
(84)
70
3
(11)
(82)
76
2
(4)
New originations or purchases
3
92
n/a
n/a
92
84
n/a
n/a
84
Net repayments
4
(23)
(26)
(5)
(54)
(22)
(25)
(4)
(51)
Derecognition of financial assets (excluding
disposals and write-offs)
5
(22)
(29)
(13)
(64)
(21)
(30)
(10)
(61)
Changes to risk, parameters, and models
6
(96)
132
302
338
(102)
181
309
388
Disposals
–
–
–
–
–
–
–
–
Write-offs
–
–
(421)
(421)
–
–
(412)
(412)
Recoveries
–
–
78
78
–
–
78
78
Foreign exchange and other adjustments
(9)
(12)
(3)
(24)
12
17
5
34
Balance, including off-balance sheet instruments,
at end of period
721
1,211
275
2,207
683
1,224
282
2,189
Less: Allowance for off-balance sheet instruments
7
22
48
–
70
25
49
–
74
Balance at end of period
$
699
$
1,163
$
275
$
2,137
$
658
$
1,175
$
282
$
2,115
Credit Card
8
Balance, including off-balance sheet instruments,
at beginning of period
$
944
$
1,386
$
460
$
2,790
$
947
$
1,374
$
378
$
2,699
Provision for credit losses
Transfer to Stage 1
1
281
(271)
(10)
–
485
(474)
(11)
–
Transfer to Stage 2
(91)
116
(25)
–
(86)
107
(21)
–
Transfer to Stage 3
(9)
(273)
282
–
(5)
(242)
247
–
Net remeasurement due to transfers into stage
2
(109)
122
9
22
(222)
112
7
(103)
New originations or purchases
3
48
n/a
n/a
48
36
n/a
n/a
36
Net repayments
4
15
3
17
35
18
4
18
40
Derecognition of financial assets (excluding
disposals and write-offs)
5
(11)
(29)
(117)
(157)
(27)
(22)
(75)
(124)
Changes to risk, parameters, and models
6
(98)
365
268
535
(247)
473
375
601
Disposals
–
–
–
–
–
–
–
–
Write-offs
–
–
(529)
(529)
–
–
(529)
(529)
Recoveries
–
–
109
109
–
–
93
93
Foreign exchange and other adjustments
(20)
(24)
(13)
(57)
28
40
16
84
Balance, including off-balance sheet instruments,
at end of period
950
1,395
451
2,796
927
1,372
498
2,797
Less: Allowance for off-balance sheet instruments
7
196
290
–
486
196
293
–
489
Balance at end of period
$
754
$
1,105
$
451
$
2,310
$
731
$
1,079
$
498
$
2,308
1
Transfers represent stage transfer movements prior to ECL remeasurement.
2
Represents the mechanical remeasurement between twelve-month (i.e., Stage 1) and lifetime ECLs (i.e., Stage 2
or 3) due to stage transfers necessitated by credit risk migration, as
described in the “Significant Increase in Credit Risk” section of Note 2 and Note 3 of the Bank’s 2025
Annual Consolidated Financial Statements, holding all other factors impacting the
change in ECLs constant.
3
Represents the increase in the allowance resulting from loans that were newly originated, purchased, or renewed.
4
Represents the changes in the allowance related to cash flow changes associated with new draws or repayments
on loans outstanding.
5
Represents the decrease in the allowance resulting from loans that were fully repaid and excludes the decrease
associated with loans that were disposed or fully written off.
6
Represents the changes in the allowance related to current period changes in risk (e.g.,
PD) caused by changes to macroeconomic factors, level of risk, parameters,
and/or models,
subsequent to stage migration. Refer to the “Measurement of Expected Credit Losses”, “Forward-Looking Information
”
and “Expert Credit Judgment”
sections of Note 2 and Note 3 of the
Bank’s 2025 Annual Consolidated Financial Statements for further details.
7
The allowance for loan losses for off-balance sheet instruments is recorded in Other liabilities on the Interim
Consolidated Balance Sheet.
8
Credit cards are considered impaired and migrate to Stage 3 when they are 90 days past due and written off
at 180 days past due. Refer to Note 2 of the Bank’s 2025 Annual
Consolidated Financial Statements for further details.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 64
Allowance for Loan Losses by Stage
(Continued)
(millions of Canadian dollars)
For the three months ended
January 31, 2026
January 31, 2025
Stage 1
Stage 2
Stage 3
Total
Stage 1
Stage 2
Stage 3
Total
Business and Government
Balance, including off-balance sheet instruments,
at beginning of period
$
1,439
$
2,092
$
790
$
4,321
$
1,150
$
1,937
$
853
$
3,940
Provision for credit losses
Transfer to Stage 1
1
93
(93)
–
–
88
(88)
–
–
Transfer to Stage 2
(138)
142
(4)
–
(153)
158
(5)
–
Transfer to Stage 3
(2)
(151)
153
–
(3)
(152)
155
–
Net remeasurement due to transfers into stage
1
(31)
45
(1)
13
(28)
58
1
31
New originations or purchases
1
419
n/a
n/a
419
300
n/a
n/a
300
Net repayments
1
7
(31)
(102)
(126)
17
(19)
(10)
(12)
Derecognition of financial assets (excluding
disposals and write-offs)
1
(267)
(255)
(102)
(624)
(169)
(196)
(76)
(441)
Changes to risk, parameters, and models
1
(92)
195
439
542
29
250
250
529
Disposals
–
–
(22)
(22)
–
–
(9)
(9)
Write-offs
–
–
(256)
(256)
–
–
(202)
(202)
Recoveries
–
–
20
20
–
–
16
16
Foreign exchange and other adjustments
(10)
(39)
(27)
(76)
41
49
(2)
88
Balance, including off-balance sheet instruments,
at end of period
1,418
1,905
888
4,211
1,272
1,997
971
4,240
Less: Allowance for off-balance sheet instruments
2
251
217
6
474
177
193
6
376
Balance at end of period
1,167
1,688
882
3,737
1,095
1,804
965
3,864
Total Allowance, including
off-balance sheet
instruments, at end of period
3,192
4,705
1,700
9,597
2,996
4,774
1,824
9,594
Less: Total Allowance for
off-balance sheet
instruments
2
469
555
6
1,030
398
535
6
939
Total Allowance for Loan Losses
at end of period
$
2,723
$
4,150
$
1,694
$
8,567
$
2,598
$
4,239
$
1,818
$
8,655
1
For explanations regarding this line item, refer to the “Allowance for Loan Losses by Stage” table on the previous
page in this Note.
2
The allowance for loan losses for off-balance sheet instruments is recorded in Other liabilities on the Interim
Consolidated Balance Sheet.
The allowance for credit losses on all remaining
financial assets is not significant.
(e)
FORWARD-LOOKING INFORMATION
Relevant macroeconomic factors are incorporated
in risk parameters as appropriate. Additional
risk factors that are industry or segment
specific are also
incorporated, where relevant. The key macroeconomic
variables used in determining ECLs include
regional unemployment rates for all retail exposures
and
regional housing price indices for residential
mortgages and home equity lines of credit.
For business and government loans,
the key macroeconomic variables
include gross domestic product (GDP), unemployment
rates, interest rates, and credit spreads.
Refer to Note 3 of the Bank’s 2025 Annual
Consolidated Financial
Statements for a discussion of how forward-looking
information is generated and considered
in determining whether there has been a
significant increase in credit
risk and in measuring ECLs.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 65
Macroeconomic Variables
Select macroeconomic variables are projected
over the forecast period.
The following table sets out average values
of the macroeconomic variables over
the four
calendar quarters starting with the current
quarter, and the remaining 4-year forecast period for the base
forecast and upside and downside scenarios
used in
determining the Bank’s ECLs as at January 31, 2026.
As the forecast period increases, information
about the future becomes less readily available
and projections
are anchored on assumptions around structural
relationships between economic parameters
that are inherently much less certain.
While trade tensions have
eased in recent months, uncertainty related to
the economic outlook remains elevated, and
our baseline forecast continues to reflect
tempered growth and higher
unemployment as a result of tariff actions. Any
further escalation in trade tensions would pose
a downside risk to the economic outlook.
However, the Bank’s
Canadian and U.S. downside scenarios reflect
a recession and help capture these risks
accordingly through its allowance process.
Macroeconomic Variables
As at
January 31, 2026
Base Forecast
Upside Scenario
Downside Scenario
Average
Remaining
Average
Remaining
Average
Remaining
Q1 2026-
4-year
Q1 2026-
4-year
Q1 2026-
4-year
Q4 2026
1
period
1
Q4 2026
1
period
1
Q4 2026
1
period
1
Unemployment rate
Canada
6.7
%
6.0
%
6.2
%
5.7
%
7.7
%
7.2
%
United States
4.2
4.0
4.1
3.8
5.6
5.4
Real GDP
Canada
1.3
1.7
1.4
1.9
(0.8)
2.1
United States
2.2
2.1
2.3
2.3
(0.3)
2.5
Home prices
Canada (average existing price)
2
4.1
3.7
4.2
3.9
(4.8)
3.3
United States (CoreLogic HPI)
3
1.6
3.5
2.2
4.1
(6.4)
4.1
Central bank policy interest rate
Canada
2.25
2.25
2.50
2.50
1.13
1.42
United States
3.44
3.25
3.63
3.50
2.06
2.30
U.S. 10-year treasury yield
4.03
4.00
4.25
4.23
3.58
3.58
U.S. 10-year BBB spread (%-pts)
1.42
1.60
1.29
1.54
2.28
1.90
Exchange rate (U.S. dollar/Canadian dollar)
$
0.74
$
0.75
$
0.74
$
0.76
$
0.68
$
0.70
1
The numbers represent average values for the quoted periods and average of year-on-year growth for real GDP and home prices.
2
The average home price is the average transacted sale price of homes sold via the Multiple Listing Service; data is collected by the Canadian Real Estate Association.
3
The CoreLogic home price index (HPI) is a repeat-sales index which tracks increases and decreases in the same home’s sales price over time.
(f)
SENSITIVITY OF ALLOWANCE FOR CREDIT LOSSES
ECLs are sensitive to the inputs used in internally
developed models, the macroeconomic
variables in the forward-looking forecasts and
respective probability
weightings in determining the probability-weighted
ECLs, and other factors considered when
applying expert credit judgment. Changes
in these inputs,
assumptions, models, and judgments would
affect the assessment of significant increase in
credit risk and the measurement of ECLs.
The following table presents the base ECL
scenario compared to the probability-weighted ECLs,
with the latter derived from three ECL
scenarios for performing
loans and off-balance sheet instruments. The difference
reflects the impact of deriving multiple
scenarios around the base ECLs and resultant
change in ECLs due
to non-linearity and sensitivity to using
macroeconomic forecasts.
Change from Base to Probability-Weighted
ECLs
(millions of Canadian dollars, except
as noted)
As at
January 31, 2026
October 31, 2025
Probability-weighted ECLs
$
7,897
$
8,137
Base ECLs
7,464
7,737
Difference – in amount
$
433
$
400
Difference – in percentage
5.8
%
5.2
%
ECLs for performing loans and off-balance sheet instruments
consist of an aggregate amount of Stage 1 and
Stage 2 probability-weighted ECLs
which are twelve-
month ECLs and lifetime ECLs, respectively. Transfers from Stage 1 to Stage
2 ECLs result from a significant increase
in credit risk since initial recognition
of the
loan.
The following table shows the estimated
impact of staging on ECLs by presenting all
performing loans and off-balance sheet instruments
calculated using
twelve-month ECLs compared to the current
aggregate probability-weighted ECLs, holding
all risk profiles constant.
Incremental Lifetime ECLs Impact
(millions of Canadian dollars)
As at
January 31, 2026
October 31, 2025
Probability-weighted ECLs
$
7,897
$
8,137
All performing loans and off-balance sheet instruments
using 12-month ECLs
6,206
6,435
Incremental lifetime ECLs impact
$
1,691
$
1,702
(g)
FORECLOSED ASSETS
Foreclosed assets are repossessed non-financial
assets where the Bank gains title, ownership,
or possession of individual properties,
such as real estate
properties, which are managed for sale in an
orderly manner with the proceeds used
to reduce or repay any outstanding debt.
The Bank does not generally occupy
foreclosed properties for its business use.
The Bank predominantly relies on third-party
appraisals to determine the carrying value of
foreclosed assets.
Foreclosed
assets held for sale were $
103
million as at January 31, 2026 (October 31, 2025
– $
101
million) and were recorded in Other assets
on the Interim Consolidated
Balance Sheet.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 66
(h)
LOANS PAST DUE BUT NOT IMPAIRED
A loan is classified as past due when a borrower
has failed to make a payment by the
contractual due date.
The following table summarizes loans that are
past
due but not impaired.
Loans less than 31 days contractually past
due are excluded as they do not generally
reflect a borrower’s ability to meet
their payment
obligations.
Loans Past Due but not Impaired
1
(millions of Canadian dollars)
As at
January 31, 2026
October 31, 2025
31-60
61-89
31-60
61-89
days
days
Total
days
days
Total
Residential mortgages
$
403
$
227
$
630
$
407
$
129
$
536
Consumer instalment and other personal
1,004
365
1,369
930
301
1,231
Credit card
378
257
635
373
253
626
Business and government
402
108
510
247
85
332
Total
$
2,187
$
957
$
3,144
$
1,957
$
768
$
2,725
1
Includes loans that are measured at FVOCI.
NOTE 7: INVESTMENTS IN ASSOCIATES AND JOINT VENTURES
INVESTMENT IN THE CHARLES SCHWAB CORPORATION
On February 12, 2025, the Bank sold its entire
remaining equity investment in The
Charles Schwab Corporation (“Schwab”) through a
registered offering and
share repurchase by Schwab. Immediately prior
to the sale, TD held
184.7
million shares of Schwab’s common stock, representing
10.1
% economic ownership.
The sale of the shares resulted in proceeds
of approximately $
21.0
billion and the Bank recognized in Other income
(loss) a net gain on sale of approximately
$
9.2
billion. This gain is net of the release of
related cumulative foreign currency translation
from AOCI, the release of AOCI on designated
net investment hedging
items, and direct transaction costs. For segment
reporting, the Bank recognized an after-tax
gain of $
8.6
billion in its Corporate segment and $
184
million of
underwriting fees in its Wholesale segment
as a result of TD Securities acting as a lead
bookrunner on the transaction.
The Bank discontinued recording its share
of earnings available to common shareholders
from its investment in Schwab following
the sale. Prior to the sale, the
Bank accounted for its investment in
Schwab using the equity method. The Bank’s
share of Schwab’s earnings available to common
shareholders was reported
with a one-month lag. The Bank’s share of net
income from its prior investment in Schwab
of $
231
million during the three months ended January
31, 2025,
reflects net income after adjustments for
amortization of certain intangibles net of tax.
The Stockholder Agreement was terminated
by the Bank’s sale of its equity investment in Schwab.
The Bank continues to have a business
relationship with
Schwab through the insured deposit account
agreement (“Schwab IDA Agreement”).
INSURED DEPOSIT ACCOUNT AGREEMENT
On May 4, 2023, the Bank and Schwab entered
into an amended Schwab IDA Agreement,
with an initial expiration of July 1, 2034.
Pursuant to the Schwab IDA
Agreement, the Bank makes sweep deposit
accounts available to clients of Schwab.
Schwab designates a portion of the deposits
with the Bank as fixed-rate
obligation amounts. Remaining deposits are designated
as floating-rate obligations. The IDA deposit
floor is set at US$
60
billion.
Refer to Note 26 of the Bank’s 2025 Annual
Consolidated Financial Statements for further details
on the Schwab IDA Agreement.
NOTE 8: OTHER ASSETS
Other Assets
(millions of Canadian dollars)
As at
January 31
October 31
2026
2025
Accounts receivable and other items
$
9,697
$
9,366
Accrued interest
5,647
5,674
Current income tax receivable
3,939
3,849
Defined benefit asset
1,018
1,111
Investments in other associates and joint
ventures
5,206
5,237
Prepaid expenses
1,828
1,815
Reinsurance contract assets
915
936
Total
$
28,250
$
27,988
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 67
NOTE 9: DEPOSITS
Demand deposits are those for which the Bank does not have the right to require notice prior to withdrawal, which
primarily include business and government
chequing accounts. Notice deposits are those for which the Bank can legally require notice prior to withdrawal,
which include both savings and chequing
accounts. Term
deposits are payable on a given date of maturity and are purchased by customers to earn interest over a fixed period, with terms ranging from
one day to ten years and generally include fixed term deposits, guaranteed investment certificates, senior debt, and similar
instruments. The aggregate amount
of term deposits in denominations of $100,000 or more as at January 31, 2026, was $
571
billion (October 31, 2025 – $
544
billion).
Deposits
(millions of Canadian dollars)
As at
January 31
October 31
By Type
By Country
2026
2025
Demand
Notice
Term
1
Canada
United States
International
Total
Total
Personal
$
26,153
$
479,809
$
132,464
$
356,167
$
282,259
$
–
$
638,426
$
650,396
Banks
9,908
242
14,379
18,166
4,403
1,960
24,529
27,233
Business and government
2
155,591
199,603
226,995
429,538
151,771
880
582,189
589,475
191,652
679,654
373,838
803,871
438,433
2,840
1,245,144
1,267,104
Trading
–
–
42,328
30,334
5,300
6,694
42,328
37,882
Designated at fair value through
profit or loss
3
–
–
224,941
75,821
84,842
64,278
224,941
197,336
Total
$
191,652
$
679,654
$
641,107
$
910,026
$
528,575
$
73,812
$
1,512,413
$
1,502,322
Non-interest-bearing deposits
included above
4
Canada
$
61,296
$
60,796
United States
70,447
73,364
International
–
1
Interest-bearing deposits
included above
4
Canada
848,730
834,275
United States
5
458,128
468,328
International
73,812
65,558
Total
2,6
$
1,512,413
$
1,502,322
1
Includes $
102.4
billion (October 31, 2025 – $
104.3
billion) of senior debt which is subject to the bank recapitalization “bail-in” regime. This regime provides
certain statutory powers to the
Canada Deposit Insurance Corporation, including the ability to convert specified eligible shares and liabilities into
common shares in the event that the Bank becomes non-viable.
2
Includes $
72.5
billion relating to covered bondholders (October 31, 2025 – $
70.6
billion).
3
Financial liabilities designated at FVTPL on the Consolidated Balance Sheet also include $
296
million (October 31, 2025 – $
299
million) of loan commitments, financial guarantees and
other liabilities designated at FVTPL.
4
The geographical splits of the deposits are based on the point of origin of the deposits.
5
Includes $
8.8
billion (October 31, 2025 – $
7.2
billion) of U.S. federal funds deposited and $
4.1
billion (October 31, 2025 – $
1.1
billion) of deposits and advances with the FHLB.
6
Includes deposits of $
809.5
billion (October 31, 2025 – $
807.7
billion) denominated in U.S. dollars and $
119.2
billion (October 31, 2025 – $
111.1
billion) denominated in other foreign
currencies.
NOTE 10: OTHER LIABILITIES
Other Liabilities
(millions of Canadian dollars)
As at
January 31
October 31
2026
2025
Accounts payable, accrued expenses, and
other items
1
$
11,031
$
8,954
Accrued interest
4,545
4,652
Accrued salaries and employee benefits
4,733
7,313
Cheques and other items in transit
1,424
255
Current income tax payable
283
296
Deferred tax liabilities
280
303
Defined benefit liability
1,354
1,372
Lease liabilities
5,250
5,352
Liabilities related to structured entities
3,888
4,008
Provisions
(Note 17)
1,721
1,735
Total
$
34,509
$
34,240
1
Includes dividends and distributions payable of $
1,802
million as at January 31, 2026 (October 31, 2025 –
nil
).
NOTE 11: SUBORDINATED NOTES AND DEBENTURES
Redemptions
On January 20, 2026, the Bank announced
that subsequent to the quarter-end, it intends
to exercise its right to redeem on March
4, 2026 all of its outstanding
$
1.25
billion
4.859
% non-viability contingent capital medium-term
notes due March 4, 2031 constituting
subordinated indebtedness of the Bank, at
a redemption
price of
100
per cent of the principal amount, plus
accrued and unpaid interest to, but excluding,
March 4, 2026.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 68
NOTE 12: EQUITY
The following table summarizes the changes
to the shares and other equity instruments
issued and outstanding,
and treasury instruments held as at and
for the
three months ended January 31, 2026 and
January 31, 2025.
Shares and Other Equity Instruments
Issued and Outstanding and Treasury Instruments
Held
(thousands of shares or other equity instruments
and millions of Canadian dollars)
For the three months ended
January 31, 2026
January 31, 2025
Number
Number
of shares
Amount
of shares
Amount
Common Shares
Balance as at beginning of period
1,689,496
$
24,727
1,750,272
$
25,373
Proceeds from shares issued on exercise
of stock options
1,208
108
353
25
Shares issued as a result of dividend
reinvestment plan
–
–
1,575
130
Purchase of shares for cancellation and other
(19,426)
(284)
–
–
Balance as at end of period – common shares
1,671,278
$
24,551
1,752,200
$
25,528
Preferred Shares and Other Equity Instruments
Preferred Shares – Class A
Balance as at beginning of period
49,650
$
2,850
91,650
$
3,900
Redemption of shares
–
–
(20,000)
(500)
Balance as at end of period
49,650
$
2,850
71,650
$
3,400
Other Equity Instruments
1
Balance as at beginning of period
7,251
$
8,775
5,751
$
6,988
Issue of limited recourse capital notes
–
–
750
750
Balance as at end of period
7,251
8,775
6,501
7,738
Balance as at end of period – preferred
shares
and other equity instruments
56,901
$
11,625
78,151
$
11,138
Treasury – common shares
2
Balance as at beginning of period
–
$
–
213
$
(17)
Purchase of shares
27,028
(3,314)
44,875
(3,504)
Sale of shares
(26,987)
3,309
(44,630)
3,483
Balance as at end of period – treasury
– common shares
41
$
(5)
458
$
(38)
Treasury – preferred shares and
other equity instruments
2
Balance as at beginning of period
29
$
(4)
163
$
(18)
Purchase of shares and other equity instruments
227
(162)
2,453
(1,120)
Sale of shares and other equity instruments
(245)
155
(2,067)
1,087
Balance as at end of period – treasury
– preferred shares and other equity
instruments
11
$
(11)
549
$
(51)
1
For Other Equity Instruments, the number of shares represents the number of notes issued.
2
When the Bank purchases its own equity instruments as part of its trading business, they are classified as treasury
instruments and the cost of these instruments is recorded as a
reduction in equity.
DIVIDENDS
On February 25, 2026, the Board approved
a dividend in an amount of one dollar and eight
cents ($
1.08
) per fully paid common share in the capital
stock of the
Bank for the quarter ending April 30, 2026, payable
on and after April 30, 2026, to shareholders
of record at the close of business on April
9, 2026.
DIVIDEND REINVESTMENT PLAN
The Bank offers a Dividend Reinvestment Plan
(DRIP) for its common shareholders.
Participation in the plan is optional and
under the terms of the plan, cash
dividends on common shares are used
to purchase additional common shares. At
the option of the Bank, the common shares
may be issued from treasury at an
average market price based on the last five
trading days before the date of the dividend
payment, with a discount of between
0
% to
5
% at the Bank’s discretion or
purchased from the open market at market
prices.
During the three months ended January 31,
2026, the Bank satisfied the DRIP requirements
through open market common share purchases
(three months
ended January 31, 2025 – the Bank satisfied
the DRIP requirements through common
shares issued from treasury with
no
discount).
NORMAL COURSE ISSUER BID
On February 24, 2025, the Bank announced
that the Toronto Stock Exchange (TSX) and OSFI had approved the Bank’s normal
course issuer bid (2025 NCIB) to
repurchase for cancellation up to $
8
billion of its common shares, not to exceed
100
million common shares. The Bank completed
$
8
billion in repurchases and
terminated the 2025 NCIB in January 2026.
From the commencement of the 2025
NCIB on March 3, 2025, to its completion
and termination on January 15, 2026,
the Bank repurchased
80.2
million shares under the program, at an average
price of $
99.74
per share for a total amount of $
8.0
billion.
On January 16, 2026, the Bank announced
that the TSX and OSFI have approved
the Bank’s new normal course issuer bid (2026
NCIB) to repurchase for
cancellation up to $
7
billion of its common shares, not
to exceed
61
million common shares. The 2026 NCIB
commenced on January 20, 2026, and will
terminate
on (A) the earliest to occur of: (i) January 15,
2027; (ii) the date on which the aggregate
purchase cost of common shares purchased
equals $
7
billion; and (iii) the
date on which the maximum number of
common shares purchasable is reached; or
(B) such earlier date as the Bank may
determine. From the commencement of
the 2026 NCIB on January 20, 2026, to January
31, 2026, the Bank repurchased
3.8
million shares under the program, at an average
price of $
129.06
per share
for a total amount of $
0.5
billion.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 69
NOTE 13: SHARE-BASED COMPENSATION
For the three months ended January 31,
2026, the Bank recognized compensation
expense for stock option awards of $
9.4
million (three months ended
January 31, 2025 – $
3.1
million). During the three months ended
January 31, 2026,
1.6
million (three months ended January 31,
2025 –
2.0
million) stock options
were granted by the Bank at a weighted-average
fair value of $
21.89
per option (January 31, 2025 – $
12.80
per option).
The following table summarizes the assumptions
used for estimating the fair value of options
for the three months ended January 31,
2026 and January 31, 2025.
Assumptions Used for Estimating the
Fair Value of Options
(in Canadian dollars, except as noted)
For the three months ended
January 31
January 31
2026
2025
Risk-free interest rate
3.42
%
3.08
%
Option contractual life
10 years
10 years
Expected volatility
19.44
%
19.47
%
Expected dividend yield
4.02
%
3.94
%
Exercise price/share price
$
126.43
$
75.76
The risk-free interest rate is based on Government
of Canada benchmark bond yields as
at the grant date. Expected volatility is
calculated based on the historical
average daily volatility and expected dividend
yield is based on dividend payouts in the last
fiscal year. These assumptions are measured over a period
corresponding to the option contractual life.
NOTE 14: EMPLOYEE BENEFITS
The following table summarizes expenses for
the Bank’s principal pension and non-pension post-retirement
defined benefit plans and the Bank’s other
material
defined benefit pension plans, for the
three months ended January 31, 2026
and January 31, 2025. Other employee defined
benefit plans operated by the Bank
and certain of its subsidiaries are not considered
material for disclosure purposes.
Defined Benefit Plan Expenses
(millions of Canadian dollars)
Principal post-retirement
Principal pension plans
benefit plan
Other pension plans
1
For the three months ended
January 31
January 31
January 31
January 31
January 31
January 31
2026
2025
2026
2025
2026
2025
Service cost – benefits earned
$
69
$
69
$
1
$
2
$
5
$
5
Net interest cost (income) on net defined
benefit liability (asset)
(12)
(12)
4
4
4
6
Defined benefit administrative expenses
2
3
–
–
2
1
Total
$
59
$
60
$
5
$
6
$
11
$
12
1
Includes Canada Trust defined benefit pension plan, TD Banknorth defined benefit pension
plan, TD Auto Finance defined benefit pension plan, TD Insurance defined benefit pension
plan, and supplemental executive defined benefit pension plans.
The following table summarizes expenses for
the Bank’s defined contribution plans for the three
months ended January 31, 2026 and January
31, 2025.
Defined Contribution Plan Expenses
(millions of Canadian dollars)
For the three months ended
January 31
January 31
2026
2025
Defined contribution pension plans
1
$
111
$
106
Government pension plans
2
230
220
Total
$
341
$
326
1
Includes defined contribution portion of the TD Pension Plan (Canada) and TD Bank, N.A. defined contribution 401(k)
plan.
2
Includes Canada Pension Plan, Quebec Pension Plan, and Social Security under the U.S.
Federal Insurance Contributions Act
.
The following table summarizes the remeasurements
recognized in OCI for the Bank’s principal pension
and post-retirement defined benefit plans
and certain of
the Bank’s other material defined benefit pension
plans, for the three months ended January
31, 2026 and January 31, 2025.
Amounts Recognized in Other Comprehensive
Income for Remeasurement of Defined
Benefit Plans
1,2,3
(millions of Canadian dollars)
Principal post-retirement
Principal pension plans
benefit plan
Other pension plans
For the three months ended
January 31
January 31
January 31
January 31
January 31
January 31
2026
2025
2026
2025
2026
2025
Remeasurement gain/(loss) – financial
$
235
$
(139)
$
8
$
(7)
$
(1)
$
(10)
Remeasurement gain/(loss) – return on plan
assets less
interest income
(311)
182
–
–
–
–
Change in asset limitation and minimum
funding requirement
–
(3)
–
–
–
–
Total
$
(76)
$
40
$
8
$
(7)
$
(1)
$
(10)
1
Excludes the Canada Trust defined benefit pension plan, TD Banknorth defined benefit
pension plan, TD Auto Finance defined benefit pension plan, TD Insurance defined benefit pension
plan, and other employee defined benefit plans operated by the Bank and certain of its subsidiaries not considered material for
disclosure purposes as these plans are not remeasured on
a quarterly basis.
2
Changes in discount rates and return on plan assets are reviewed and updated on a quarterly basis. All other assumptions
are updated annually.
3
Amounts are presented on a pre-tax basis.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 70
NOTE 15: INCOME TAXES
Other Tax Matters
The Canada Revenue Agency (CRA), Revenu
Québec Agency (RQA) and Alberta
Tax and Revenue Administration (ATRA) are denying certain dividend and
interest deductions claimed by the Bank.
As at January 31, 2026, the CRA has reassessed
the Bank for $
1,676
million for the years 2011 to 2020, the RQA has
reassessed the Bank for $
52
million for the years 2011 to 2019, and the ATRA has reassessed the Bank for $
71
million for the years 2011 to 2020. In total, the
Bank has been reassessed for $
1,799
million of income tax and interest. The Bank
expects to continue to be reassessed
for open years. The Bank is of the view
that its tax filing positions were appropriate
and filed a Notice of Appeal with the
Tax Court of Canada on March 21, 2023.
NOTE 16: EARNINGS PER SHARE
Basic earnings per share is calculated by
dividing net income available to common
shareholders by the weighted-average number
of common shares outstanding
for the period.
Diluted earnings per share is calculated using
the same method as basic earnings per
share except that certain adjustments are made
to net income available
to common shareholders and the weighted-average
number of shares outstanding for the effects of
all dilutive potential common shares
that are assumed to be
issued by the Bank.
The following table presents the Bank’s basic and
diluted earnings per share for the three
months ended January 31, 2026 and January
31, 2025.
Basic and Diluted Earnings Per Share
(millions of Canadian dollars, except
as noted)
For the three months ended
January 31
January 31
2026
2025
Basic earnings per share
Net income available to common shareholders
$
3,942
$
2,707
Weighted-average number of common shares outstanding
(millions)
1,680.3
1,749.9
Basic earnings per share
(Canadian dollars)
$
2.35
$
1.55
Diluted earnings per share
Net income available to common shareholders
including impact of dilutive securities
$
3,942
$
2,707
Weighted-average number of common shares outstanding
(millions)
1,680.3
1,749.9
Effect of dilutive securities
Stock options potentially exercisable (millions)
1
4.4
0.8
Weighted-average number of common shares outstanding
– diluted (millions)
1,684.7
1,750.7
Diluted earnings per share
(Canadian dollars)
1
$
2.34
$
1.55
1
For the three months ended January 31, 2026, the computation of diluted earnings per share excluded average
options outstanding of
0.8
million (three months ended January 31, 2025
–
5.9
million), with a weighted-average exercise price of $
126.43
(three months ended January 31, 2025
– $
84.34
), as the option price was greater than the average market price of the
Bank’s common shares.
NOTE 17: PROVISIONS AND CONTINGENT
LIABILITIES
Other than as described below, there have been no new significant
events or transactions except as previously
identified in Note 25 of the Bank’s 2025 Annual
Consolidated Financial Statements.
(a)
RESTRUCTURING CHARGES
The Bank continued to undertake certain
measures in the first quarter of 2026 to reduce
its cost base and achieve greater efficiency. In connection with this
program, the Bank incurred $
200
million pre-tax of restructuring charges during
the three months ended January 31, 2026.
The restructuring charges primarily
relate to: (i) employee severance and other
personnel-related costs recorded
as provisions, (ii) real estate optimization
mainly recorded as a reduction to buildings
and land, and (iii) asset impairment and
other rationalization, including certain
business wind-downs.
The restructuring program has concluded.
(b)
LEGAL AND REGULATORY MATTERS
In the ordinary course of business, the Bank
and its subsidiaries are involved in various
legal and regulatory actions, including but
not limited to civil claims and
lawsuits, regulatory examinations, investigations,
audits, and requests for information by
governmental, regulatory and self-regulatory
agencies and law
enforcement authorities in various jurisdictions,
in respect of our businesses and compliance
programs. The Bank establishes provisions
when it becomes
probable that the Bank will incur a loss and
the amount can be reliably estimated.
The Bank also estimates the aggregate range
of reasonably possible losses
(RPL) in its legal and regulatory actions (that
is, those which are neither probable nor
remote), in excess of provisions. However, the Bank does
not disclose the
specific possible loss associated with each underlying
matter given the substantial uncertainty associated
with each possible loss as described below and
the
negative consequences to the Bank’s resolution
of the matters that comprise the
RPL should individual possible losses be disclosed.
As at January 31, 2026, the
Bank’s RPL is from
zero
to approximately $
448.6
million (October 31, 2025 – from
zero
to approximately $
440.7
million). The Bank’s provisions and RPL represent
the Bank’s best estimates based upon currently available
information for actions for which estimates
can be made, but there are a number of factors
that could
cause the Bank’s actual losses to be significantly
different from its provisions or RPL. For example,
the Bank’s estimates involve significant judgment
due to the
varying stages of the proceedings, the existence
of multiple defendants in many proceedings
whose share of liability has yet to be determined,
the numerous yet-
unresolved issues in many of the proceedings,
some of which are beyond the Bank’s control and/or
involve novel legal theories and interpretations,
the attendant
uncertainty of the various potential outcomes
of such proceedings, and the fact that the underlying
matters will change from time to time. In addition,
some actions
seek very large or indeterminate damages.
Refer to Note 25 of the Bank’s 2025 Annual Consolidated
Financial Statements for details on the Bank’s significant
legal and regulatory matters. Based on
the Bank’s current knowledge, and subject to
the factors listed above as well as other uncertainties
inherent in litigation and
regulatory matters, other than as described
below: (i) there have been no notable developments
to the matters previously identified in Note 25
of the Bank’s 2025
Annual Consolidated Financial Statements; and
(b) since October 31, 2025, no other legal
or regulatory matter has arisen or progressed
to the point that it would
reasonably be expected to result in a material
financial impact to the Bank.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 71
As previously disclosed, on October 10, 2024,
the Bank announced that, following active
cooperation and engagement with authorities and
regulators, it
reached a resolution (the “Global Resolution”)
of previously disclosed investigations related
to its U.S. Bank Secrecy Act (BSA) and Anti-Money
Laundering (AML)
compliance programs (collectively, the “U.S. BSA/AML program”).
The Bank and certain of its U.S. subsidiaries
consented to orders with the Office of the
Comptroller of the Currency (OCC), the Federal
Reserve Board, and the Financial Crimes
Enforcement Network and entered into plea agreements
with the
Department of Justice (DOJ), Criminal
Division, Money Laundering and Asset
Recovery Section and the United States
Attorney’s Office for the District of New
Jersey. Details of the Global Resolution include: (i) a total payment
of US$
3.088
billion ($
4.233
billion), all of which was provisioned during
the 2024 fiscal year;
(ii) TD Bank, N.A. (TDBNA) pleading guilty
to one count of conspiring to fail to maintain
an adequate AML program, failing
to file accurate currency transaction
reports (CTRs) and launder money and
TD Bank US Holding Company (TDBUSH)
pleading guilty to two counts of causing
TDBNA to fail to maintain an adequate
AML program and to fail to file accurate
CTRs; (iii) requirements to remediate the
Bank’s U.S. BSA/AML program; (iv) a requirement
to prioritize the funding and
staffing of the remediation, which includes Board
certifications for dividend distributions
from certain of the Bank’s U.S. subsidiaries to the
Bank; (v) formal
oversight of the U.S. BSA/AML remediation
through an independent compliance monitorship;
(vi) a prohibition against the average combined
total assets of TD’s
two U.S. banking subsidiaries (TDBNA and
TD Bank USA, N.A.) (collectively, the “U.S. Bank”) exceeding
US$
434
billion (representing the combined total assets
of the U.S. Bank as at September 30, 2024)
(the “Asset Limitation”), and if the
U.S. Bank does not achieve compliance with
all actionable articles in the OCC
consent orders (and for each successive
year that the U.S. Bank remains non-compliant),
the OCC may require the U.S. Bank to
further reduce total consolidated
assets by up to
7
%; (vii) the U.S. Bank being subject to OCC
supervisory approval processes for any
additions of new bank products, services,
markets, and
stores prior to the OCC’s acceptance of the
U.S. Bank’s improved AML policies and procedures,
to ensure the AML risk of new initiatives is appropriately
considered and mitigated; (viii) requirements
for the Bank and TD Group U.S. Holdings,
LLC (TDGUS) to retain a third party
to assess the effectiveness of the
corporate governance and U.S. management
structure and composition to adequately
oversee U.S. operations; (ix) requirements
to comply with the terms of the
plea agreements with the DOJ during a five-year
term of probation (which could be extended
as a result of the Bank failing to complete
the compliance
undertakings, failing to cooperate or to report
alleged misconduct as required, or
committing additional crimes); (x) an ongoing
obligation to cooperate with DOJ
investigations; and (xi) an ongoing obligation
to report evidence or allegations of violations
by the Bank, its affiliates, or their employees
that may be a violation of
U.S. federal law. The Bank is focused on meeting the
terms of the consent orders and plea agreements,
including meeting its requirements to remediate
the
Bank’s U.S. BSA/AML compliance programs.
During the first fiscal quarter of 2025, the
Bank fully paid the remainder of the monetary penalty
owed pursuant to the
consent orders and plea agreements that
were entered into as part of the Global Resolution.
The payment was covered by provisions previously
taken by the Bank
for this matter.
As previously disclosed, the Bank and
some former and current directors, officers and employees
have been named as defendants in proposed
class action
lawsuits in the United States and Canada
purporting to be brought on behalf of
the Bank’s shareholders alleging, among other things,
that a decline in the price of
the Bank’s shares was the result of misleading disclosures
with respect to the Bank’s AML compliance programs
and/or the potential outcomes of the government
agencies’ or regulators’ investigations.
The two proposed class actions filed in
the United States have been consolidated
under the caption
Tiessen v. The
Toronto-Dominion Bank, et al.,
in the United States District Court for
the Southern District of New York, and a consolidated amended complaint
has been filed
which names TD Bank, N.A., TDBUSH,
and certain former and current officers as
defendants. On May 30, 2025, the defendants
filed a motion to dismiss in the
Tiessen
case, which is pending before the court. Out
of the three proposed class actions in Ontario,
Parkin v. The Toronto-Dominion Bank, et al.,
has been
identified as the lead action with the other
two Ontario actions being stayed. There remains
one further proposed class action in Quebec
which has been stayed.
The
Parkin
certification hearing and the motion to seek
leave under the
Securities Act
(Ontario) was argued in part on February
17 to 20, 2026, with additional
dates to be scheduled. A putative shareholder
derivative action, captioned
Rubin v. Masrani, et al.,
has also been filed purportedly on behalf
of TD in the United
States in the Supreme Court of the State
of New York, New York County,
against certain former and current TD directors,
officers and employees, and certain of
TD’s U.S. affiliates and subsidiaries. The complaint asserts
alleged breaches of duties and other
claims against the individual defendants in
connection with the
Bank’s U.S. BSA/AML compliance programs.
On October 31, 2025, TD filed a
motion to dismiss the
Rubin
action. Certain purported TD shareholders
have also
filed an application in the Ontario Superior
Court of Justice (
The Trustees of International Brotherhood of Electrical Workers,
et al., v. The Toronto-Dominion Bank,
et al.
) seeking leave to bring a shareholder derivative
action in the Delaware Court of Chancery
on behalf of TD and TDBUSH against certain
current and former
directors and officers. The motion to seek leave
is scheduled for April 21, 2026. All of
the proceedings are still in early stages. Losses
or damages cannot be
estimated at this time.
As previously disclosed, the Bank has been
named as defendant in a purported class
action lawsuit in the United States to be brought
on behalf of First Horizon
shareholders alleging that a decline in the price
of First Horizon shares was the result
of alleged misleading disclosures the
Bank made with respect to its U.S.
BSA/AML compliance programs and its
effect on the Bank’s contemplated merger with
First Horizon. The lawsuit also names some of
the Bank’s former and
current officers and a former employee as defendants.
On November 26, 2025, the court dismissed
plaintiffs’ complaint, but gave plaintiffs a final opportunity
to
amend their complaint again to attempt
to address its deficiencies. On January
22, 2026, the plaintiffs did not amend their complaint
and instead filed a notice of
appeal. Losses or damages cannot be estimated
at this time.
As previously disclosed, the Bank is a defendant
in Canada and/or the United States in a
number of matters brought by customers, including
class actions,
alleging claims in connection with various
fees, practices and credit decisions. The
cases are in various stages of maturity and
include, among others: a Quebec
action against members of the financial
services industry (including the Bank) regarding
the existence and amount of the insufficient or
non-sufficient funds fee, a
Quebec action against certain brokers (including
TD Direct Investing) regarding disclosure
of foreign conversion fees, and a Quebec action
against members of
the automobile insurance industry (including
Primmum Insurance Company) regarding
underwriting practices in Quebec.
Refer to Note 15 for disclosures related
to tax matters.
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 72
NOTE 18: SEGMENTED INFORMATION
For management reporting purposes, the Bank
reports its results from business operations
and activities under four key business
segments:
Canadian Personal
and Commercial Banking, U.S. Banking,
Wealth Management and Insurance, and Wholesale
Banking. The Bank’s other activities are grouped
into the Corporate
segment. Effective the first quarter of 2026, the
Bank renamed its U.S. Retail segment to
U.S. Banking to better reflect the segment’s financial
products and
services.
Canadian Personal and Commercial
Banking provides financial products and services
to personal, small business and commercial
customers, and includes
TD Auto Finance Canada. U.S. Banking is
comprised of personal and business banking
in the U.S., TD Auto Finance U.S., and the
U.S. wealth business.
Effective
the first quarter of 2026, non-interest income
within U.S. Banking is adjusted for the Bank’s
share of losses from community-based
tax-advantaged investments
accounted for using the equity method
which are reclassified to provision for income
taxes. The adjustment between non-interest
income and provision for income
taxes reflected in U.S. Banking results is reversed
in the Corporate segment. The adjustment
for the quarter was $
184
million (US$
132
million), compared with
$
145
million (US$
105
million) in the prior quarter and $
164
million (US$
116
million) in the first quarter last year. Comparative amounts
have been reclassified to
conform with the presentation adopted in the
current period. On February 12, 2025, the Bank
sold its entire remaining equity investment in
Schwab.
Prior to the
sale, the Bank’s investment in Schwab was reported
in the U.S. Banking segment,
refer to Note 7 for further details.
Wealth Management and Insurance includes
the Canadian wealth business which provides
investment products and services to institutional
and retail investors, and the insurance
business which provides
property and casualty insurance, as well as
life and health insurance products to customers
across Canada.
Wholesale Banking provides a wide range
of capital
markets, investment banking, and corporate
banking products and services,
including underwriting and distribution
of new debt and equity issues, providing
advice
on strategic acquisitions and divestitures, and
meeting the daily trading, funding, and investment
needs of the Bank’s clients. The Corporate segment
includes the
effects of certain asset securitization programs,
treasury management, elimination of
taxable equivalent adjustments and other
management reclassifications,
corporate level tax items, and residual unallocated
revenue and expenses.
The following table summarizes the segment
results for the three months ended January
31, 2026 and January 31, 2025.
Results by Business Segment
1
(millions of Canadian dollars)
Canadian
Wealth
Personal and
Management
Commercial Banking
U.S. Banking
and Insurance
Wholesale Banking
2
Corporate
2
Total
For the three months ended January 31
2026
2025
2026
2025
2026
2025
2026
2025
2026
2025
2026
2025
Net interest income (loss)
$
4,394
$
4,135
$
3,296
$
3,064
$
406
$
369
$
(75)
$
(107)
$
768
$
405
$
8,789
$
7,866
Non-interest income (loss)
1,027
1,014
789
(118)
3,500
3,229
2,545
2,107
(65)
(49)
7,796
6,183
Total revenue
5,421
5,149
4,085
2,946
3,906
3,598
2,470
2,000
703
356
16,585
14,049
Provision for (recovery of)
credit losses
436
521
295
451
–
–
172
72
136
168
1,039
1,212
Insurance service expenses
–
–
–
–
1,622
1,507
–
–
–
–
1,622
1,507
Non-interest expenses
2,147
2,086
2,468
2,380
1,258
1,173
1,563
1,535
1,317
896
8,753
8,070
Income (loss) before income taxes
and share of net income from
investment in Schwab
2,838
2,542
1,322
115
1,026
918
735
393
(750)
(708)
5,171
3,260
Provision for (recovery of)
income taxes
794
711
282
(28)
269
238
174
94
(391)
(317)
1,128
698
Share of net income from
investment in Schwab
3,4
–
–
–
199
–
–
–
–
–
32
–
231
Net income (loss)
$
2,044
$
1,831
$
1,040
$
342
$
757
$
680
$
561
$
299
$
(359)
$
(359)
$
4,043
$
2,793
1
The retailer program partners’ share of revenues and credit losses is presented in the Corporate segment, with an
offsetting amount (representing the partners’ net share) recorded in
non-interest expenses, resulting in no impact to Corporate reported net income (loss). Net income (loss) included
in the U.S. Banking segment includes only the portion of revenue and
credit losses attributable to the Bank under the agreements.
2
Net interest income within Wholesale Banking is calculated on a taxable equivalent basis (TEB). The TEB adjustment
reflected in Wholesale Banking is reversed in the Corporate
segment.
3
The after-tax amount for amortization of acquired intangibles was recorded in the Corporate segment.
4
The Bank’s share of Schwab’s earnings was reported with a one-month lag. Refer to
Note 7 for further details.
Total Assets by Business Segment
(millions of Canadian dollars)
Canadian
Wealth
Personal and
Management
Wholesale
Commercial Banking
U.S. Banking
and Insurance
Banking
Corporate
Total
As at January 31, 2026
Total assets
$
622,046
$
512,606
$
26,278
$
778,643
$
159,733
$
2,099,306
As at October 31, 2025
Total assets
$
616,115
$
530,729
$
25,231
$
754,391
$
168,092
$
2,094,558
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 73
NOTE 19: INTEREST INCOME AND EXPENSE
The following tables present interest income
and interest expense by basis of accounting
measurement.
Interest Income
(millions of Canadian dollars)
For the three months ended
January 31, 2026
January 31, 2025
Measured at amortized cost
1
$
17,561
$
19,844
Measured at FVOCI – Debt instruments
1
1,163
902
18,724
20,746
Measured or designated at FVTPL
1,913
2,061
Measured at FVOCI – Equity instruments
59
65
Total
$
20,696
$
22,872
1
Interest income is calculated using EIRM.
Interest Expense
(millions of Canadian dollars)
For the three months ended
January 31, 2026
January 31, 2025
Measured at amortized cost
1
$
9,152
$
11,820
Measured or designated at FVTPL
2,755
3,186
Total
$
11,907
$
15,006
1
Interest expense is calculated using EIRM.
NOTE 20: REGULATORY CAPITAL
The Bank manages its capital under guidelines
established by OSFI. The regulatory
capital guidelines measure capital in relation
to credit, market, and operational
risks. The Bank has various capital policies,
procedures, and controls which it utilizes
to achieve its goals and objectives. The
Bank is designated as a domestic
systemically important bank (D-SIB) and
a global systemically important bank (G-SIB).
Canadian banks designated as D-SIBs are required
to comply with OSFI’s minimum targets for risk-based
capital and leverage ratios. The minimum
targets
include a D-SIB surcharge and Domestic Stability
Buffer (DSB) for Common Equity Tier 1 Capital, Tier 1 Capital, Total Capital and risk-based Total Loss
Absorbing Capacity (TLAC) ratios. The
DSB level was increased to
3.5
% as of November 1, 2023, and as a result
the published regulatory minimum targets
are
set at
11.5
%,
13.0
%,
15.0
% and
25.0
%, respectively. The OSFI target includes the greater of the D-SIB
or G-SIB surcharge, both of which are
currently
1
% for the
Bank. The OSFI target for leverage requires
D-SIBs to hold a leverage ratio buffer of
0.50
% in addition to the existing minimum requirement.
This sets the
published regulatory minimum targets for leverage
and TLAC leverage ratios at
3.5
% and
7.25
%, respectively.
The Bank complied with all minimum risk-based
capital and leverage ratio requirements
set by OSFI in the three months ended January
31, 2026.
The following table summarizes the Bank’s regulatory
capital positions as at January 31, 2026
and October 31, 2025.
Regulatory Capital Position
(millions of Canadian dollars, except
as noted)
As at
January 31
October 31
2026
2025
Capital
Common Equity Tier 1 Capital
$
92,392
$
93,579
Tier 1 Capital
103,312
104,502
Total Capital
115,065
116,866
Risk-weighted assets used in the calculation
of capital ratios
635,191
636,424
Capital and leverage ratios
Common Equity Tier 1 Capital ratio
14.5
%
14.7
%
Tier 1 Capital ratio
16.3
16.4
Total Capital ratio
18.1
18.4
Leverage ratio
4.5
4.6
TLAC Ratio
31.1
31.8
TLAC Leverage Ratio
8.6
8.9
TD BANK GROUP • FIRST QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 74
SHAREHOLDER AND INVESTOR INFORMATION
Shareholder Services
If you:
And your inquiry relates to:
Please contact:
Are a registered shareholder (your name appears
on your TD share certificate)
Missing dividends, lost share certificates, estate
questions, address changes to the share register,
dividend bank account changes, the dividend
reinvestment plan, eliminating duplicate mailings
of
shareholder materials or stopping (or resuming)
receiving annual and quarterly reports
Transfer Agent:
TSX Trust Company
301-100 Adelaide Street West
Toronto, ON M5H 4H1
1-800-387-0825 (Canada and U.S. only)
or 416-682-3860
Facsimile: 1-888-249-6189
shareholderinquiries@tmx.com or www.tsxtrust.com
Hold your TD shares through the
Direct Registration System
in the United States
Missing dividends, lost share certificates, estate
questions, address changes to the share register,
eliminating duplicate mailings of shareholder
materials or stopping (or resuming) receiving
annual
and quarterly reports
Co-Transfer Agent and Registrar:
Computershare Trust Company, N.A.
P.O. Box 43006
Providence, RI 02940-3006
or
Computershare Trust Company, N.A.
150 Royall Street
Suite 101
Canton, MA 02021
1-866-233-4836
TDD for hearing impaired: 1-800-231-5469
Shareholders outside of U.S.: 201-680-6578
TDD shareholders outside of U.S.: 201-680-6610
Email inquiries: web.queries@computershare.com
For electronic access to your account visit:
www.computershare.com/investor
Beneficially own TD shares that are
held in the
name of an intermediary, such as a bank,
a trust
company, a securities broker or other nominee
Your TD shares, including questions
regarding the
dividend reinvestment plan and mailings of
shareholder materials
Your intermediary
For all other shareholder inquiries, please
contact TD Shareholder Relations at
416-944-6367 or 1-866-756-8936 or email
tdshinfo@td.com. Please note that by
leaving us an e-mail or voicemail message,
you are providing your consent for us to
forward your inquiry to the appropriate party
for response.
General Information
Products and services: Contact TD
Canada Trust, 24 hours a day, seven
days a week: 1-866-567-8888
French: 1-866-233-2323
Cantonese/Mandarin: 1-800-328-3698
Telephone device for the hearing impaired
(TTY): 1-800-361-1180
Website:
www.td.com
Email:
customer.service@td.com
Quarterly Earnings Conference Call
TD Bank Group will host an earnings conference
call in Toronto, Ontario on February
26, 2026. The call will be audio webcast
live through TD’s website at
9:30 a.m. ET. The call will feature presentations
by TD executives on the Bank’s
financial results for the first quarter and
discussions of related disclosures,
followed by a question-and-answer period with analysts.
The presentation material referenced
during the call will be available on the
TD website at
www.td.com/investor
on February 26,
2026, in advance of the call.
A listen-only telephone line
is available at 416-855-9085 or 1-800-990-2777
(toll free), passcode
24789#.
The audio webcast and presentations will be
archived at
www.td.com/investor
. Replay of the teleconference will be available
until 11:59 p.m. ET on
March 13, 2026, by calling 289-819-1325 or 1-888-660-6264
(toll free). The passcode is 24789#.
Annual Meeting
Thursday, April 16, 2026
Toronto, Ontario
ex992
THE TORONTO-DOMINION BANK
EARNINGS COVERAGE ON SUBORDINATED
NOTES AND DEBENTURES,
PREFERRED SHARES CLASSIFIED AS EQUITY,
AND LIABILITIES FOR
PREFERRED SHARES AND OTHER EQUITY INSTRUMENTS
AND CAPITAL
TRUST SECURITIES
FOR THE TWELVE
MONTHS ENDED JANUARY 31,
2026
TD Bank Group (“TD” or the “Bank”) dividend
requirements on all its outstanding preferred
shares and other equity instruments in respect
of the twelve months
ended January 31, 2026 and adjusted to a before-tax
equivalent using an effective tax rate of approximately
17.8% for the twelve months ended January
31, 2026,
amounted to $706 million. The Bank’s interest and
dividend requirements on all subordinated notes
and debentures, preferred shares and liabilities
for preferred
shares and other equity instruments and
capital trust securities, after adjustment
for new issues and retirement, amounted
to $1,221 million for the twelve months
ended January 31, 2026.
The Bank’s reported net income, before interest on
subordinated debt and liabilities for preferred
shares and capital trust securities and
income taxes was $26,064 million for the
twelve months ended January 31, 2026,
which was 21.4 times the Bank’s aggregate dividend
and interest requirement
for this period.
On an adjusted basis, the Bank’s net income before
interest on subordinated debt and liabilities
for preferred shares and other equity instruments
and capital
trust securities and income taxes for the twelve
months ended January 31, 2026, was $20,247
million, which was 16.6 times the Bank’s aggregate
dividend and
interest requirement for this period.
The Bank prepares its interim consolidated
financial statements in accordance with International
Financial Reporting Standards (IFRS),
the current generally
accepted accounting principles (GAAP),
and refers to results prepared in accordance
with IFRS as “reported”
results. The Bank also utilizes non-GAAP
financial
measures such as “adjusted”
results (i.e. reports results excluding
“items of note”) and non-GAAP ratios to
assess each of its businesses and measure
overall
Bank performance. The Bank believes that non-GAAP
financial measures and non-GAAP ratios
provide the reader with a better understanding
of how
management views the Bank’s performance.
Non-GAAP financial measures and ratios used
in this presentation are not defined under
IFRS, and, therefore, may
not be comparable to similar terms used by
other issuers. See “How We Performed”
and “Quarterly Results” sections of the
Bank’s first quarter 2026 MD&A
(available at www.td.com/investor and www.sedarplus.ca), which are incorporated
by reference, for further explanation,
reported basis results, a list of the items
of
note, and a reconciliation of adjusted to reported
results.
ex993
RETURN ON ASSETS, AND EQUITY TO ASSETS
RATIOS
1,2
For the three months ended
For the year ended
January 31, 2026
October 31, 2025
October 31, 2025
Return on Assets – reported
3
0.74
%
0.58
%
0.95
%
Return on Assets – adjusted
4
0.77
0.70
0.69
Equity to Asset Ratio
5
6.0
6.0
5.9
1
Calculated pursuant to the U.S. Securities and Exchange Commission Industry Guide 3.
2
The Bank prepares its consolidated financial statements in accordance with International Financial Reporting Standards
(IFRS), the current generally accepted accounting principles
(GAAP), and refers to results prepared in accordance with IFRS as the “reported” results. The Bank also utilizes
non-GAAP financial measures such as “adjusted” results (i.e. reported
results excluding “items of note”) and non-GAAP ratios to assess each of its businesses and measure overall Bank
performance. The Bank believes that non-GAAP financial measures
and non-GAAP ratios provide the reader with a better understanding of how management views the Bank’s
performance. Non-GAAP financial measures and ratios used in this
presentation are not defined terms under IFRS and, therefore, may not be comparable to similar terms used by other
issuers. For further explanation regarding reported basis results, list
of the items of note, and a reconciliation of adjusted to reported results,
refer to “Significant Events”, “How We Performed”,
and “How Our Businesses Performed“ sections of the Bank’s
first quarter 2026 MD&A (available at www.td.com/investor and www.sedar.com),
which are incorporated by reference.
3
Calculated as reported net income available to common shareholders divided by average total assets.
4
Calculated as adjusted net income available to common shareholders divided by average total assets.
5
Calculated as average total equity divided by average total assets.
ex994
TD BANK GROUP • FIRST QUARTER 2026
• EARNINGS NEWS RELEASE
Page 1
1
2
3
4
TD Bank Group Reports First Quarter 2026 Results
Earnings News Release
•
Three months ended January 31, 2026
This quarterly Earnings News Release (ENR)
should be read in conjunction with the
Bank’s unaudited first quarter 2026
Report to Shareholders for the three
months ended January 31, 2026, prepared in
accordance with International Financial Reporting
Standards (IFRS) as issued by the
International Accounting
Standards Board (IASB), which is available
on our website at http://www.td.com/investor/.
This ENR is dated February 25, 2026. Unless
otherwise indicated, all
amounts are expressed in Canadian dollars, and
have been primarily derived from the Bank’s
Annual or Interim Consolidated Financial
Statements prepared in
accordance with IFRS. Certain comparative
amounts have been revised to conform with
the presentation adopted in the current period.
Additional information
relating to the Bank is available on the Bank’s website
at http://www.td.com,
as well as on SEDAR+ at http://www.sedarplus.ca
and on the U.S. Securities and
Exchange Commission’s (SEC) website at http://www.sec.gov
(EDGAR filers section).
Reported results conform with generally
accepted accounting principles (GAAP),
in accordance with IFRS.
Adjusted results are non-GAAP financial
measures.
For additional information about the Bank’s use
of non-GAAP financial measures, refer
to “Significant Events”,
“Non-GAAP and Other Financial
Measures” in the
“How We Performed”,
or “How Our Businesses Performed” sections
of this document.
FIRST QUARTER FINANCIAL HIGHLIGHTS,
compared with the first quarter last year:
●
Reported diluted earnings per share were
$2.34, compared with $1.55.
●
Adjusted diluted earnings per share were
$2.44, compared with $2.02.
●
Reported net income was $4,043 million,
compared with $2,793 million.
●
Adjusted net income was $4,216 million,
compared with $3,623 million.
FIRST QUARTER ADJUSTMENTS (ITEMS OF
NOTE)
The first quarter reported earnings figures
included the following items of note:
●
Amortization of acquired intangibles
of $34 million ($26 million after tax or 1
cent per share), compared with $61 million
($52 million after tax or
3 cents per share) in the first quarter last
year.
●
Impact from the terminated First Horizon
Corporation (FHN) acquisition-related
capital hedging strategy of $44 million ($32
million after tax or
2 cents per share), compared with $54 million
($41 million after tax or 2 cents per
share) in the first quarter last year.
●
Restructuring charges of $200 million
($148 million after tax or 9 cents per share).
●
Federal Deposit Insurance Corporation
(FDIC)
special assessment of ($44)
million (($33) million after tax or (2) cents
per share).
TORONTO
, February 26, 2026
– TD Bank Group (“TD” or the “Bank”)
today announced its financial results for the
first quarter ended January 31, 2026.
Reported
earnings were $4.0 billion,
up 45% compared with the first quarter last
year, and adjusted earnings were $4.2 billion, up 16%.
“TD delivered strong first quarter results, including
record adjusted earnings and significant
year
‑
over
‑
year adjusted return on equity growth,
reflecting momentum
across our businesses as we advance our
Investor Day goals. We achieved robust trading
and fee income growth in our markets-driven
businesses, volume
growth in Canadian Personal and Commercial
Banking, and margin expansion,” said
Raymond Chun, Group President and
CEO, TD Bank Group. “Across TD, our
colleagues are driving deeper relationships,
helping us build a simpler and faster bank,
with disciplined execution.”
Canadian Personal and Commercial
Banking delivered record revenue,
earnings, deposit and loan volumes
Canadian Personal and Commercial
Banking net income was a record $2,044
million, an increase of 12% compared
with the first quarter last year, reflecting
higher pre-tax, pre-provision earnings (PTPP)
,
,
an increase of 7% year-over-year, and lower provisions
for credit losses (PCL). Revenue was a record
$5,421 million, an increase of 5% year-over-year, primarily
reflecting increased loan and deposit
volumes.
Canadian Personal Banking made significant
progress in deepening client relationships,
achieving its highest quarterly credit
card acquisitions in over a decade,
driven by record existing client pre-approvals
and new client credit card deepening rates. In
addition, the business also delivered
simpler and faster client and
colleague experiences with the national expansion
of its Branch Virtual Assistant, a GenAI Knowledge
Management tool, and the initial scaling of
an agentic AI
capability in Real Estate Secured Lending
to accelerate speed-to-decision.
Canadian Business Banking delivered
strong loan and non-term deposit growth
this
quarter, supported by continued expansion of its distribution
footprint. Small Business Banking also
saw continued growth in chequing accounts,
driven by
compelling client offers and strong frontline engagement.
U.S. Banking sustained business momentum
and executed against critical deliverables
U.S. Banking
reported net income was $1,040 million
(US$747 million),
an increase of $897 million (US$642
million) year-over-year. On an adjusted basis,
net
income was $1,007 million (US$723
million), an increase of $168 million (US$129
million) year-over-year, reflecting the impact of U.S. balance
sheet restructuring
activities and lower PCL, partially offset by higher
governance and control investments, including
costs for U.S. BSA/AML remediation and
higher employee-
related expenses.
This quarter, U.S. Banking sustained its momentum, supported
by growth across core lending portfolios
,
including record Bankcard digital sales
and robust year-
over-year growth in client assets within
U.S. Wealth. Conversion of the Nordstrom
credit card servicing platform has been
completed, enhancing scale to support
the U.S. credit card franchise.
Wealth Management and Insurance delivered record
earnings and assets reflecting strong
contributions from both business lines
1
PTPP is a non-GAAP financial measure, calculated by subtracting Canadian Personal and Commercial Banking
segment’s reported non-interest expenses from reported revenue.
Reported revenue – Q1 2026: $5,421 million, Q1 2025: $5,149 million. Reported non-interest expenses – Q1 202
6: $2,147 million, Q1 2025: $2,086 million. PTPP – Q1 2026:
$3,274 million, Q1 2025: $3,063 million.
2
For additional information about the Bank’s use of non-GAAP financial measures, refer to “Non-GAAP
and Other Financial Measures” in the “How We Performed” section of this
document.
3
Effective the first quarter of 2026, the Bank renamed its U.S. Retail segment to U.S. Banking to better
reflect the segment’s financial products and services. U.S. Banking net income
excludes earnings of $199 million (US$142 million) from the Bank’s investment in The Charles Schwab
Corporation in the first quarter last year.
4
Core loan growth is defined as growth in average loan volumes excluding the impact of the loan portfolios identified
for sale or run-off under our U.S. balance sheet restructuring program.
TD BANK GROUP • FIRST QUARTER 2026
• EARNINGS NEWS RELEASE
Page 2
5
6
Wealth Management and Insurance net income
was $757 million, an increase of $77 million
year-over-year, driven by record assets, strong transaction
revenue
and insurance premiums growth.
Wealth Management delivered strong performance
in the quarter, with trades per day in TD Direct Investing
increasing 10% year-over-year, reflecting the strength
of TD’s comprehensive trading platforms. TD Wealth unified
its two discretionary businesses within
Private Wealth Management, simplifying the business
and
positioning it for scalable growth. This quarter, TD Insurance
continued to strengthen its position as Canada’s leading
digital, direct insurer
,
, with 80% of clients
digitally engaged. TD Insurance issued another
innovative catastrophe bond, the first in
the Canadian market to provide protection
against aggregate losses from
small and medium-sized catastrophe events.
Wholesale Banking delivered record
revenue and earnings
Wholesale Banking reported net income of
$561 million for the quarter, an increase of $262 million
year-over-year, primarily reflecting higher revenues, partially
offset by higher PCL and non-interest expenses. On
an adjusted basis, net income was a record
$561 million, an increase of $221 million
year-over-year. Revenue
for the quarter was a record $2,470 million, an
increase of 24% year-over-year, driven by strong execution
across Global Markets, and Corporate
and Investment
Banking.
TD Securities advanced its strategy by leveraging
its integrated platform to deepen client relationships,
driving diversified revenue across Global
Markets,
and
Corporate and Investment Banking. This quarter, TD Securities
scaled prime services with the launch of
its U.S. and European synthetic prime offering.
In addition,
Wholesale Banking maintained disciplined execution,
focusing on moderated expense growth
and improved return on equity.
Capital
TD’s Common Equity Tier 1 Capital ratio was 14.5%.
Conclusion
“As our clients navigate an increasingly complex
landscape, we are investing in talent,
technology and new capabilities to support
their financial goals. We are
deploying AI-enabled applications across
TD, enhancing how we work, and creating
new, intuitive and personalized experiences for our
clients. Our colleagues
remain the source of our strength, and
I thank them for their dedication to our
clients and the Bank,” added Chun.
The foregoing contains forward-looking statements. Please refer to the “Caution Regarding Forward-Looking Statements”
on page 3.
5
Leading Digital Insurer: Based on comparison of digital adoption metrics as published by other major insurer.
6
Leading Direct Insurer: Rankings based on data compiled from MSA Research for the year ended December 31,
- Excludes public insurance entities (Insurance Corporation of British
Columbia, Manitoba Public Insurance, and Saskatchewan Auto Fund).
TD BANK GROUP • FIRST QUARTER 2026
• EARNINGS NEWS RELEASE
Page 3
Caution Regarding Forward-Looking Statements
From time to time, the Bank (as defined in this document) makes written and/or oral forward-looking statements, including
in this document, in other filings with Canadian regulators or the United States (U.S.) Securities
and
Exchange Commission (SEC), and in other communications. In addition, representatives of the
Bank may make forward-looking statements orally to analysts, investors, the media, and others. All such
statements are made
pursuant to the “safe harbour” provisions of, and are intended to be forward-looking statements
under, applicable Canadian and U.S. securities legislation, including the U.S.
Private Securities Litigation Reform Act
of 1995.
Forward-looking statements include, but are not limited to, statements made in this document,
the Management’s Discussion and Analysis (“2025 MD&A”) in the Bank’s 2025 Annual Report under the heading “Economic
Summary and Outlook”, under the headings “Key Priorities for 2026” and “Operating Environment and
Outlook” for the Canadian Personal and Commercial Banking, U.S. Banking, Wealth Management and Insurance,
and
Wholesale Banking segments, and under the heading “2025 Accomplishments and Focus for 2026”
for the Corporate segment, and in other statements regarding the Bank’s objectives and priorities for 2026 and
beyond
and strategies to achieve them, the regulatory environment in which the Bank operates, and the Bank’s anticipated
financial performance.
Forward-looking statements are typically identified by words such as “will”, “would”, “should”, “believe”,
“expect”, “anticipate”, “intend”, “estimate”, “forecast”, “outlook”, “plan”, “goal”, “target”, “possible”,
“potential”,
“predict”, “project”, “may”, and “could” and similar expressions or variations thereof, or the negative thereof,
but these terms are not the exclusive means of identifying such statements. By their very
nature, these forward-
looking statements require the Bank to make assumptions and are subject to inherent risks and
uncertainties, general and specific. Especially in light of the uncertainty related to the physical, financial,
economic, political,
and regulatory environments, such risks and uncertainties – many of which are beyond the Bank’s control
and the effects of which can be difficult to predict – may cause actual results to differ materially from the
expectations expressed in the forward-looking statements.
Risk factors that could cause, individually or in the aggregate, such differences include: strategic, credit,
market (including equity, commodity, foreign exchange, interest rate, and credit spreads), operational (including
technology, cyber security, process, systems, data, third-party, fraud, infrastructure, insider and conduct), model, insurance, liquidity, capital adequacy, compliance and legal, financial crime, reputational, environmental and
social, and other risks. Examples of such risk factors include general business and economic conditions
in the regions in which the Bank operates; geopolitical risk (including policy, trade and tax-related risks and the
potential impact of any new or elevated tariffs or any retaliatory tariffs); inflation, interest rates and recession uncertainty; regulatory
oversight and compliance risk; risks associated with the Bank’s ability to satisfy the terms
of the global resolution of the investigations into the Bank’s U.S.
Bank Secrecy Act
(BSA)/anti-money laundering (AML) program; the impact of the global resolution of the investigations
into the Bank’s U.S. BSA/AML
program on the Bank’s businesses, operations, financial condition, and reputation; the ability of the Bank to execute
on long-term strategies, shorter-term key strategic priorities, including the successful completion of
acquisitions and dispositions and integration of acquisitions, the ability of the Bank to achieve its financial
or strategic objectives with respect to its investments, business retention plans, and other strategic
plans; technology
and cyber security risk (including cyber-attacks, data security breaches or technology failures) on the
Bank’s technologies, systems and networks, those of the Bank’s customers (including their own devices), and third
parties providing services to the Bank; data risk; model risk; fraud activity; insider risk; conduct
risk; the failure of third parties to comply with their obligations to the Bank or its affiliates, including
relating to the care and
control of information, and other risks arising from the Bank’s use of third-parties; the impact of new and changes
to, or application of, current laws, rules and regulations, including without limitation consumer
protection laws
and regulations, tax laws, capital guidelines and liquidity regulatory guidance; increased competition
from incumbents and new entrants (including Fintechs and big technology competitors); shifts in consumer
attitudes and
disruptive technology; environmental and social risk (including climate-related risk); exposure related to
litigation and regulatory matters; ability of the Bank to attract, develop, and retain key talent;
changes in foreign
exchange rates, interest rates, credit spreads and equity prices; downgrade, suspension or withdrawal
of ratings assigned by any rating agency, the value and market price of the Bank’s common shares and other securities
may be impacted by market conditions and other factors; the interconnectivity of financial institutions
including existing and potential international debt crises; increased funding costs and market volatility due to
market
illiquidity and competition for funding; critical accounting estimates and changes to accounting standards,
policies, and methods used by the Bank; and the occurrence of natural and unnatural catastrophic
events and
claims resulting from such events.
The Bank cautions that the preceding list is not exhaustive of all possible risk factors and other
factors could also adversely affect the Bank’s results. For more detailed information, please refer to the “Risk
Factors and
Management” section of the 2025 MD&A, as may be updated in subsequently filed quarterly reports to shareholders
and news releases (as applicable) related to any events or transactions discussed under the headings
“Significant Events”, “Significant and Subsequent Events” or “Update on U.S. Bank Secrecy
Act (BSA)/Anti-Money Laundering (AML) Program Remediation and Enterprise AML Program Improvement
Activities“ in the
relevant MD&A, which applicable releases may be found on www.td.com. All such factors, as well as other
uncertainties and potential events, and the inherent uncertainty of forward-looking statements, should be
considered carefully when making decisions with respect to the Bank. The Bank cautions readers
not to place undue reliance on the Bank’s forward-looking statements.
Material economic assumptions underlying the forward-looking statements contained in this document are set
out in the 2025 MD&A under the headings “Economic Summary and Outlook” and “Significant
Events”, under
the headings “Key Priorities for 2026” and “Operating Environment and Outlook” for the Canadian
Personal and Commercial Banking, U.S. Banking, Wealth Management and Insurance, and Wholesale Banking segments,
and under the heading “2025 Accomplishments and Focus for 2026” for the Corporate segment,
each as may be updated in subsequently filed quarterly reports to shareholders and news releases (as
applicable).
Any forward-looking statements contained in this document represent the views of management only as
of the date hereof and are presented for the purpose of assisting the Bank’s shareholders and analysts in
understanding the Bank’s financial position, objectives and priorities and anticipated financial performance as at and
for the periods ended on the dates presented, and may not be appropriate for other
purposes. The Bank
does not undertake to update any forward-looking statements, whether written or oral, that may be
made from time to time by or on its behalf, except as required under applicable securities legislation.
This document was reviewed by the Bank’s Audit Committee and was approved by the Bank’s Board of Directors,
on the Audit Committee’s recommendation, prior to its release.
TD BANK GROUP • FIRST QUARTER 2026
• EARNINGS NEWS RELEASE
Page 4
TABLE 1: FINANCIAL HIGHLIGHTS
(millions of Canadian dollars, except
as noted)
For the three months ended
January 31
October 31
January 31
2026
2025
2025
Results of operations
Total revenue – reported
$
16,585
$
15,494
$
14,049
Total revenue – adjusted
1
16,629
16,028
15,030
Provision for (recovery of) credit losses
1,039
982
1,212
Insurance service expenses (ISE)
1,622
1,602
1,507
Non-interest expenses – reported
8,753
8,808
8,070
Non-interest expenses – adjusted
1
8,563
8,540
7,983
Net income – reported
4,043
3,280
2,793
Net income – adjusted
1
4,216
3,905
3,623
Financial position
(billions of Canadian dollars)
Total loans net of allowance for loan losses
$
958.5
$
953.0
$
965.3
Total assets
2,099.3
2,094.6
2,093.6
Total deposits
1,245.1
1,267.1
1,290.5
Total equity
125.6
127.8
119.0
Total risk-weighted assets
2
635.2
636.4
649.0
Financial ratios
Return on common equity (ROE) – reported
3
13.6
%
10.7
%
10.1
%
Return on common equity – adjusted
1
14.2
12.8
13.2
Return on tangible common equity (ROTCE)
1,3
16.3
12.9
13.4
Return on tangible common equity – adjusted
1
16.9
15.4
17.2
Efficiency ratio – reported
3
52.8
56.8
57.4
Efficiency ratio – adjusted, net of ISE
1,3,4
57.1
59.2
59.0
Provision for (recovery of) credit losses
as a % of net
average loans and acceptances
0.43
0.41
0.50
Common share information – reported
(Canadian dollars)
Per share earnings
Basic
$
2.35
$
1.82
$
1.55
Diluted
2.34
1.82
1.55
Dividends per share
1.08
1.05
1.05
Book value per share
3
68.20
68.78
61.61
Closing share price (TSX)
5
127.26
115.16
82.91
Shares outstanding (millions)
Average basic
1,680.3
1,698.2
1,749.9
Average diluted
1,684.7
1,701.5
1,750.7
End of period
1,671.2
1,689.5
1,751.7
Market capitalization (billions of Canadian dollars)
$
212.7
$
194.6
$
145.2
Dividend yield
3
3.5
%
3.9
%
5.4
%
Dividend payout ratio
3
45.9
57.6
67.8
Price-earnings ratio
3
10.3
10.0
17.5
Total shareholder return (1 year)
3
60.0
56.7
6.9
Common share information – adjusted
(Canadian dollars)
1
Per share earnings
Basic
$
2.45
$
2.19
$
2.02
Diluted
2.44
2.18
2.02
Dividend payout ratio
44.0
%
47.9
%
51.9
%
Price-earnings ratio
14.5
13.8
10.6
Capital ratios
2
Common Equity Tier 1 (CET1) Capital ratio
14.5
%
14.7
%
13.1
%
Tier 1 Capital ratio
16.3
16.4
14.7
Total Capital ratio
18.1
18.4
17.0
Leverage ratio
4.5
4.6
4.2
Total Loss Absorbing Capacity (TLAC) ratio
31.1
31.8
29.5
TLAC Leverage ratio
8.6
8.9
8.5
1
The Toronto-Dominion Bank (“TD” or the
“Bank”) prepares its Interim Consolidated Financial Statements in accordance with IFRS,
the current GAAP, and refers
to results prepared in
accordance with IFRS as the “reported” results. The Bank also utilizes non-GAAP financial measures
such as “adjusted” results and non-GAAP ratios to assess each of its businesses
and to measure overall Bank performance. To
arrive at adjusted results, the Bank adjusts reported results for “items of note”. Refer to “Significant
Events”, “How We Performed” or “How
Our Businesses Performed” sections
of this document for further explanation, a list of the items of note, and a reconciliation of
adjusted to reported results. Non-GAAP financial measures
and ratios used in this document are not defined terms under IFRS and, therefore, may not be comparable to similar
terms used by other issuers.
2
These measures have been included in this document in accordance with the Office of the Superintendent
of Financial Institutions Canada’s (OSFI’s) Capital Adequacy
Requirements
(CAR), Leverage Requirements (LR), and Total
Loss Absorbing Capacity (TLAC) guidelines.
Refer to the “Capital Position” section in the Bank’s first quarter 2026 Management’s
Discussion and Analysis (MD&A) for further details.
3
For additional information about these metrics, refer to the Glossary in the Bank’s first
quarter 2026 MD&A, which is incorporated by reference.
4
Efficiency ratio – adjusted, net of ISE is calculated by dividing adjusted non-interest expenses by adjusted
total revenue, net of ISE. Adjusted total revenue, net of ISE –
Q1 2026: $15,007 million, Q4 2025: $14,426 million, Q1 2025: $13,523 million.
5
Toronto Stock Exchange closing market
price.
TD BANK GROUP • FIRST QUARTER 2026
• EARNINGS NEWS RELEASE
Page 5
7
8
SIGNIFICANT EVENTS
Restructuring Charges
The Bank continued to undertake certain
measures in the first quarter of 2026 to reduce
its cost base and achieve greater efficiency. In connection with this
program, the Bank incurred $200 million
pre-tax of restructuring charges for the three
months ended January 31, 2026, which primarily
related to employee
severance and other personnel-related
costs, real estate optimization, and asset impairment
and other rationalization, including certain
business wind-downs. The
Bank is above its previously disclosed guidance
that its restructuring charges in the first
quarter of 2026 would be approximately
$125 million pre-tax, primarily due
to additional workforce optimization opportunities.
The restructuring program concluded on
January 31, 2026, with total program charges
of $886 million pre-tax. The Bank expects
the program to generate total
pre-tax fully realized annual program savings
of approximately $775 million, including
savings from an approximate 3% workforce
reduction
.
UPDATE ON THE
REMEDIATION
OF THE U.S. BANK SECRECY ACT/ANTI-MONEY LAUNDERING
PROGRAM AND
ENTERPRISE AML PROGRAM
As previously disclosed, on October 10, 2024,
the Bank announced that, following active
cooperation and engagement with authorities and
regulators, it reached a
resolution (the “Global Resolution”) of
previously disclosed investigations related
to its U.S. BSA/AML program. The Bank
and certain of its U.S. subsidiaries
consented to orders with the Office of the Comptroller
of the Currency (“OCC”), the Federal
Reserve Board (“FRB”), and the Financial Crimes
Enforcement
Network (“FinCEN”) and entered into plea agreements
with the Department of Justice (“DOJ”), Criminal
Division, Money Laundering and Asset Recovery
Section
and the United States Attorney’s Office for the District
of New Jersey. The full terms of the consent orders and plea
agreements are available on the Bank’s issuer
profile on SEDAR+ at www.sedarplus.com.
The Bank is focused on meeting the terms
of the consent orders and plea agreements,
including meeting the requirements to remediate
the Bank’s U.S. BSA/AML
program. In addition, the Bank is also undertaking
remediation of the Bank’s enterprise-wide AML/Anti-Terrorist Financing and Sanctions
Programs (“Enterprise
AML Program”).
For additional information on the risks associated
with the remediation of the Bank’s U.S. BSA/AML
program and the Bank’s Enterprise AML Program,
see the
“Risk Factors That May Affect Future Results –
Remediation of the Bank’s U.S. BSA/AML Program
and Enterprise AML Program” section
of the 2025 MD&A.
Update on the Remediation of the U.S.
AML Program
The Bank remains focused on remediating
its U.S. BSA/AML program to meet the requirements
of the Global Resolution. The Bank continues
to work on its
management remediation actions (the term
“management remediation actions” is
not a regulatory definition and is considered by
the Bank to consist of the root
cause assessments, data preparation, design,
documentation, frameworks, policies, standards,
training, processes, systems, testing and implementation
of
controls, as well as the hiring of resources)
with significant work and important milestones
remaining in calendar 2026 and calendar 2027
including the Suspicious
Activity Report lookback per the OCC consent
order which management expects
to complete in calendar 2027. For fiscal 2026,
the Bank continues to expect U.S.
BSA/AML remediation and related governance
and control investments of approximately
US$500 million pre-tax.
All management remediation actions
will be
subject to demonstrated sustainability and
validation by the Bank’s internal audit function
(with such activities currently planned
for calendar 2026 and calendar
2027), as well as the review by the appointed
monitor, and, ultimately, the review and approval of the Bank’s U.S. banking regulators
and the DOJ. Following such
independent reviews, testing, and validation,
there could be additional management remediation
actions that would take place after calendar
2027 in which case
the overall remediation timeline may be extended.
In addition, as the Bank undertakes the lookback
reviews, the Bank may be required to further expand
the
scope of the review, either in terms of the subjects being
addressed and/or the time period reviewed.
The following graph illustrates the Bank’s expected
remediation plan and progress on a calendar
year basis, based on its work to date:
The Bank’s remediation timeline is based on
the Bank’s current plans, as well as assumptions
related to the duration of planning activities,
including the
completion of external benchmarking and
lookback reviews. The Bank’s ability to
meet its planned remediation milestones assumes
that the Bank will be able to
successfully execute against its U.S. BSA/AML
remediation program plan, which is
subject to inherent risks and uncertainties including
the Bank’s ability to attract
and retain key employees, the ability of
third parties to deliver on their contractual obligations,
the successful development and implementation
of required
technology solutions, and data availability
to complete the required lookback reviews.
Furthermore, the execution of the U.S. BSA/AML
remediation plan, including
these planned milestones, will not be entirely
within the Bank’s control because of various factors
such as (i) the requirement to obtain regulatory
approval or non-
objection before proceeding with various
steps, and (ii) the requirement for the various
deliverables to be acceptable to the regulators
and/or the monitor. As of the
date hereof, the Bank believes that it and its applicable
U.S. subsidiaries have taken such actions
as are required of them to date under the
terms of the consent
orders and plea agreements and is not aware
of them being in breach of the same. For
information about the Bank’s AML governance
framework, see the
“Managing Risk” section in the Bank’s first quarter
2026 MD&A.
While substantial work remains, the
Bank is making progress on remediating and
strengthening its U.S. BSA/AML program
as previously disclosed including
continued improvements through:
7
The Bank’s expectations regarding the restructuring program are subject to inherent uncertainties and
are based on the Bank’s assumptions regarding certain factors, including rate of
natural attrition, talent re-deployment opportunities, years-of-service, execution timing of actions, and foreign exchange
translation impacts. Refer to the “Risk Factors That May Affect
Future Results” section in the Bank’s first quarter 2026 MD&A for additional information about risks and
uncertainties that may impact the Bank’s estimates.
8
The total amount expected to be spent on remediation and governance and control investments is subject to inherent uncertainties
and may vary based on the scope of work in the U.S.
BSA/AML remediation plan which could change as a result of additional findings that are identified as work progresses
as well as the Bank’s ability to successfully execute against the
U.S. BSA/AML remediation program in accordance with the U.S. Banking segment’s fiscal 2026 and
medium-term plan
.
TD BANK GROUP • FIRST QUARTER 2026
• EARNINGS NEWS RELEASE
Page 6
1)
enhanced customer screening procedures
which incorporate new automated system
capabilities for customer onboarding;
2)
the adoption of a more data-driven financial
crime risk assessment methodology and process
which provides a more accurate assessment of
the
Bank’s financial crimes risks; and
3)
the deployment of the first phase of the
U.S. Bank’s new centralized Know Your Customer (KYC)
platform to certain business users, enabling
the
collection and maintenance of customer information
in a single profile resulting in better insights
about the Bank’s customers.
Going forward, the Bank’s focus will be on
continuing to remediate and strengthen its
U.S. BSA/AML program, including:
1)
further deployments of the new KYC
platform;
2)
further deployments of machine learning
and specialized AI;
3)
continued focus on lookback reviews as required
under the OCC and FinCEN consent orders;
4)
continued data enhancements with the deployment
of dedicated Financial Crimes Risk Management
(FCRM)
data environments which will create a
single source of truth in support of advanced
detection capabilities;
5)
continue enhancing its financial crime risk
assessment methodologies and processes;
and
6)
continued training and development of colleagues.
Strengthening of the Bank’s Enterprise AML Program
The Bank continues to undertake remediation
of the Enterprise AML Program, including
a range of management remediation and
enhancement actions (the term
“management remediation and enhancement
actions” is not a regulatory definition and
is considered by the Bank to consist
of root cause assessments, data
preparation, design, documentation, frameworks,
policies, standards, training, processes,
systems, testing, and execution of controls,
as well as the hiring of
resources). While the Bank has made progress
on this remediation work, it is a multi-year
endeavour and the remediation work remains
ongoing. The timing of
completion of the remediation work will not
be entirely within the Bank’s control, and is subject
to regulatory feedback, internal review, challenge and validation.
As
previously disclosed, following the end of the
first quarter of fiscal 2025, the Financial Transactions
and Reports Analysis Centre of Canada (FINTRAC)
commenced a review of certain remediation
steps that the Bank has taken to date
to address the FINTRAC violations.
This review is ongoing, and subject to the
outcome, may result in additional regulatory
actions.
The remediation and enhancement of the Enterprise
AML Program is exposed to similar
risks as noted in respect of the remediation
of the Bank’s U.S. BSA/AML
Program (see also “Remediation of the
U.S. BSA/AML Program” above). In particular, as the Bank
continues its remediation and improvement activities
of the
Enterprise AML Program, it expects an increase
in identification of reportable transactions
and/or events, which will add to the operational
backlog in the Bank’s
FCRM investigations processing that the
Bank currently faces, but is working
towards remediating, across the Bank. In
addition, on an ongoing basis, the Bank will
continue to review and assess whether issues
identified in one jurisdiction have an impact
in other jurisdictions. Furthermore, the
Bank’s regulators or law
enforcement agencies may identify other issues
with the Bank’s Enterprise AML Program, which
may result in additional regulatory actions.
These issues identified
through the Bank’s own review or by the Bank’s regulators
or law enforcement agencies may
broaden the scope of the remediation and improvements
required for
the Enterprise AML Program.
While substantial work remains, the
Bank is making progress on remediating
and strengthening the Enterprise AML
Program as previously disclosed, including:
1) continued advancement on clearing operational
backlogs;
2) completed enhancements to transaction
monitoring capabilities, including updates to the
customer risk rating methodology; and
3) conducting policy transformation activities
to strengthen alignment across FCRM
globally.
Going forward, the Bank’s focus will be on
continuing to remediate and strengthen its
Enterprise AML Program,
including:
1)
continued enhancement and adoption of
the new centralized case management
tool, with the goal of strengthening oversight
and investigations of
identified FCRM risks;
2)
ongoing advancements in transaction monitoring
capabilities;
and
3)
continued investment in supporting advanced
analytics, machine learning, and AI opportunities
within FCRM.
TD BANK GROUP • FIRST QUARTER 2026
• EARNINGS NEWS RELEASE
Page 7
HOW WE PERFORMED
ECONOMIC SUMMARY AND OUTLOOK
The global economy is forecast to slow in
calendar 2026 with decelerating cyclical
momentum reinforced by trade barriers.
The slowdown in global growth is
largely driven by slowing growth in Asia,
especially the fast-growing,
export-oriented emerging market
economies that are affected by U.S. tariffs. Other
economies, such as those in Europe, are seeing
a pickup in growth, largely from expectations
of higher government spending.
The U.S. economy has entered 2026 with
more momentum than was expected a quarter
ago. Growth in the second half of calendar
2025 picked up significantly
from a sub-par pace in the first half of the
year, buoyed by sustained strength in AI investments and
higher consumer spending. TD Economics
expects that tax
cuts, lower interest rates and some easing
on regulation and trade uncertainty will
help sustain solid momentum in the U.S.
economy in calendar 2026.
The U.S. labour market has shown signs of
stabilizing in recent months, after softening
through much of 2025. This led the Federal
Reserve to leave the federal
funds rate unchanged at a range of 3.5-3.75%
in January. The Federal Reserve is balancing inflation that remains
higher than its target with an unemployment
rate
above a level it considers consistent with “full
employment”. Inflation is expected
to cool after the one-time impact of tariffs has passed,
which should lead the
Federal Reserve to lower the policy rate further
over the coming months to 3.00-3.25%,
close to most estimates of a “neutral” level.
But the pace of interest rate
cuts will depend on the evolution of the job
and inflation data.
Canada’s economy continues to grow at a
modest pace. U.S. import tariffs have weighed on
growth both directly through lower exports
and indirectly through
the resulting uncertainty, which has weakened business and
consumer confidence about the future.
Job growth has also slowed in line with the economy.
However, slower population growth has depressed labour
force growth, pushing the unemployment
rate lower in recent months despite a generally
soft economic
backdrop. New federal defense and infrastructure
spending, an improvement in the housing
market and firmer business investments are
expected to drive a
modestly stronger growth picture in 2026.
The Canadian central bank left its overnight
rate steady at 2.25% in December and
January, after lowering its policy rate substantially since mid-2024.
Provided
inflation evolves in line with the Canadian
central bank’s current forecast, the overnight
rate is expected to remain unchanged over
the next several quarters. A
generally weaker U.S. dollar and a smaller
gap between U.S. and Canadian short-term interest
rates are expected to lift the Canadian dollar. TD Economics
expects the Canadian dollar to appreciate to
the 73-74 U.S. cent range by mid-2026, although
it is likely to be influenced by U.S. trade
policy.
HOW THE BANK REPORTS
The Bank prepares its Interim Consolidated
Financial Statements in accordance
with IFRS, the current GAAP, and refers to results prepared in accordance with
IFRS as “reported”
results.
Non-GAAP and Other Financial Measures
In addition to reported results, the Bank also
presents certain financial measures, including
non-GAAP financial measures that are historical,
non-GAAP ratios,
supplementary financial measures and capital
management measures, to assess its results.
Non-GAAP financial measures, such as “adjusted”
results, are utilized
to assess the Bank’s businesses and to measure
the Bank’s overall performance.
To
arrive at adjusted results, the Bank adjusts
for “items of note” from reported
results. Items of note are items which management
does not believe are indicative of underlying
business performance and are disclosed
in Table 3. Non-GAAP
ratios include a non-GAAP financial measure
as one or more of its components. Examples
of non-GAAP ratios include adjusted net
interest margin, adjusted basic
and diluted earnings per share (EPS), adjusted
dividend payout ratio, adjusted efficiency ratio,
net of ISE, and adjusted effective income tax rate.
The Bank
believes that non-GAAP financial measures and
non-GAAP ratios provide the reader with
a better understanding of how management
views the Bank’s
performance. Non-GAAP financial measures
and non-GAAP ratios used in this document
are not defined terms under IFRS and,
therefore, may not be
comparable to similar terms used by other issuers.
Supplementary financial measures depict
the Bank’s financial performance and position, and
capital
management measures depict the Bank’s capital
position, and both are explained in this document
where they first appear.
Investment in The Charles Schwab Corporation
(“Schwab”) and Insured Deposit Account
(IDA) Agreement
On February 12, 2025, the Bank sold its entire
remaining equity investment in Schwab
through a registered offering and share repurchase
by Schwab. The Bank
discontinued recording its share of earnings
available to common shareholders from
its investment in Schwab following
the sale.
Prior to the sale, the Bank accounted
for its investment in Schwab using the equity
method. The U.S. Banking segment reflected the Bank’s
share of net income
from its investment in Schwab. The Corporate
segment net income (loss) included
amounts for amortization of acquired intangibles,
the acquisition and integration
charges related to the Schwab transaction,
and the Bank’s share of restructuring and other
charges incurred by Schwab. The Bank’s share of
Schwab’s earnings
available to common shareholders was
reported with a one-month lag. For further
details, refer to Note 12 of the Bank’s 2025
Annual Consolidated Financial
Statements.
Subsequent to the sale of the Bank’s entire remaining
equity investment in Schwab, the Bank
continues to have a business relationship
with Schwab through
the insured deposit account agreement (“Schwab
IDA Agreement”).
On May 4, 2023, the Bank and Schwab entered
into an amended Schwab IDA Agreement,
with an initial expiration of July 1, 2034. Pursuant
to the Schwab IDA
Agreement, the Bank makes sweep deposit
accounts available to clients of Schwab.
Schwab designates a portion of the deposits
with the Bank as fixed-rate
obligation amounts. Remaining deposits are designated
as floating-rate obligations. The IDA deposit
floor is set at US$60 billion.
Refer to Note 26 of the Bank’s 2025 Annual
Consolidated Financial Statements for further
details on the Schwab IDA Agreement.
TD BANK GROUP • FIRST QUARTER 2026
• EARNINGS NEWS RELEASE
Page 8
The following table provides the operating results
on a reported basis for the Bank.
TABLE 2: OPERATING RESULTS – Reported
(millions of Canadian dollars)
For the three months ended
January 31
October 31
January 31
2026
2025
2025
Net interest income
$
8,789
$
8,545
$
7,866
Non-interest income
7,796
6,949
6,183
Total revenue
16,585
15,494
14,049
Provision for (recovery of) credit losses
1,039
982
1,212
Insurance service expenses
1,622
1,602
1,507
Non-interest expenses
8,753
8,808
8,070
Income before income taxes and share
of net income from
investment in Schwab
5,171
4,102
3,260
Provision for (recovery of) income taxes
1,128
822
698
Share of net income from investment in
Schwab
–
–
231
Net income – reported
4,043
3,280
2,793
Preferred dividends and distributions on other
equity instruments
101
191
86
Net income available to common shareholders
$
3,942
$
3,089
$
2,707
The following table provides a reconciliation between
the Bank’s adjusted and reported results.
For further details refer to the “Significant
Events”, “How We
Performed”,
or “How Our Businesses Performed” sections.
TABLE 3: NON-GAAP FINANCIAL MEASURES – Reconciliation
of Adjusted to Reported Net Income
(millions of Canadian dollars)
For the three months ended
January 31
October 31
January 31
2026
2025
2025
Operating results – adjusted
Net interest income
1
$
8,833
$
8,594
$
7,920
Non-interest income
2
7,796
7,434
7,110
Total revenue
16,629
16,028
15,030
Provision for (recovery of) credit losses
1,039
982
1,212
Insurance service expenses
1,622
1,602
1,507
Non-interest expenses
3
8,563
8,540
7,983
Income before income taxes and share of net income from
investment in Schwab
5,405
4,904
4,328
Provision for (recovery of) income taxes
1,189
999
962
Share of net income from investment in Schwab
4
–
–
257
Net income – adjusted
4,216
3,905
3,623
Preferred dividends and distributions on other equity instruments
101
191
86
Net income available to common shareholders –
adjusted
4,115
3,714
3,537
Pre-tax adjustments for items of note
Amortization of acquired intangibles
5
(34)
(34)
(61)
Restructuring charges
3
(200)
(190)
–
Acquisition and integration-related charges
3
–
(44)
(52)
Impact from the terminated FHN acquisition-related capital
hedging strategy
1
(44)
(49)
(54)
Balance sheet restructuring
2
–
(485)
(927)
FDIC special assessment
3
44
–
–
Less: Impact of income taxes
Amortization of acquired intangibles
(8)
(8)
(9)
Restructuring charges
(52)
(50)
–
Acquisition and integration-related charges
–
(9)
(11)
Impact from the terminated FHN acquisition-related capital
hedging strategy
(12)
(13)
(13)
Balance sheet restructuring
–
(97)
(231)
FDIC special assessment
11
–
–
Total adjustments for items
of note
(173)
(625)
(830)
Net income available to common shareholders – reported
$
3,942
$
3,089
$
2,707
1
After the termination of the merger agreement between the Bank and FHN on May 4, 2023, the residual
impact of the strategy is reversed through net interest income (NII) – Q1 2026: ($44)
million, Q4 2025: ($49) million,
Q1 2025: ($54) million, reported in the Corporate segment.
2
Adjusted non-interest income excludes the following item of note:
i.
Balance sheet restructuring – Q4 2025: $383 million, Q1 2025: $927 million in respect of U.S. Banking
activities, reported in the U.S. Banking segment, and Q4 2025: $102 million in respect of other
activities,
reported in the Corporate segment.
3
Adjusted non-interest expenses exclude the following items of note:
i.
Amortization of acquired intangibles – Q1 2026: $34 million, Q4 2025: $34 million, Q1 2025: $35 million, reported
in the Corporate segment;
ii.
Restructuring charges – Q1 2026: $200 million, Q4 2025: $190 million, reported in the Corporate segment;
iii.
Acquisition and integration-related charges – Q4 2025: $44 million, Q1 2025: $52 million, reported in
the Wholesale Banking segment; and
iv.
FDIC special assessment – Q1 2026: ($44) million, reported in the U.S. Banking segment.
4
Adjusted share of net income from investment in Schwab excludes the following item of note on
an after-tax basis. The earnings impact of this item was reported in the Corporate segment:
i.
Amortization of Schwab-related acquired intangibles – Q1 2025: $26 million.
5
Amortization of acquired intangibles relates to intangibles acquired as a result of asset acquisitions and
business combinations, including the after-tax amount for amortization of acquired intangibles relating
to the share of
net income from investment in Schwab, reported in the Corporate segment. Refer to
footnotes 3 and 4 for amounts.
TD BANK GROUP • FIRST QUARTER 2026
• EARNINGS NEWS RELEASE
Page 9
TABLE 4: RECONCILIATION OF REPORTED TO ADJUSTED EARNINGS PER SHARE
1
(Canadian dollars)
For the three months ended
January 31
October 31
January 31
2026
2025
2025
Basic earnings per share – reported
$
2.35
$
1.82
$
1.55
Adjustments for items of note
0.10
0.37
0.47
Basic earnings per share – adjusted
$
2.45
$
2.19
$
2.02
Diluted earnings per share – reported
$
2.34
$
1.82
$
1.55
Adjustments for items of note
0.10
0.36
0.47
Diluted earnings per share – adjusted
$
2.44
$
2.18
$
2.02
1
EPS is computed by dividing net income available to common shareholders by the weighted-average number of
shares outstanding during the period. Numbers may not add due to
rounding.
Return on Common Equity
The consolidated Bank ROE is calculated
as reported net income available to common
shareholders as a percentage of average
common equity. The
consolidated Bank adjusted ROE is calculated
as adjusted net income available to
common shareholders as a percentage of average
common equity. Adjusted
ROE is a non-GAAP financial ratio and
can be utilized in assessing the Bank’s use of equity.
ROE for the business segments is calculated
as the segment net income as a percentage
of average allocated capital. The Bank’s
methodology for allocating
capital to its business segments is largely aligned
with the common equity capital requirements
under Basel III. Capital allocated to
the business segments was
based on 11.5% of CET1 Capital for the three months ended
January 31, 2026.
TABLE 5: RETURN ON COMMON EQUITY
(millions of Canadian dollars, except
as noted)
For the three months ended
January 31
October 31
January 31
2026
2025
2025
Average common equity
$
115,250
$
114,939
$
106,133
Net income available to common shareholders
– reported
3,942
3,089
2,707
Items of note, net of income taxes
173
625
830
Net income available to common shareholders
– adjusted
$
4,115
$
3,714
$
3,537
Return on common equity – reported
13.6
%
10.7
%
10.1
%
Return on common equity – adjusted
14.2
12.8
13.2
Return on Tangible Common Equity
Tangible common equity (TCE) is calculated as common shareholders’ equity
less goodwill, imputed goodwill and intangibles
on the investments in Schwab and
other acquired intangible assets, net of related
deferred tax liabilities. ROTCE is calculated
as reported net income available to common
shareholders after
adjusting for the after-tax amortization of
acquired intangibles, which are treated as an
item of note, as a percentage of average
TCE. Adjusted ROTCE is
calculated using reported net income available
to common shareholders, adjusted for all
items of note, as a percentage of average
TCE. TCE, ROTCE, and
adjusted ROTCE can be utilized in assessing
the Bank’s use of equity. TCE is a non-GAAP financial measure,
and ROTCE and adjusted ROTCE are
non-GAAP
ratios.
TABLE 6: RETURN ON TANGIBLE COMMON EQUITY
(millions of Canadian dollars, except
as noted)
For the three months ended
January 31
October 31
January 31
2026
2025
2025
Average common equity
$
115,250
$
114,939
$
106,133
Average goodwill
18,751
18,814
19,205
Average imputed goodwill and intangibles on
investments in Schwab
–
–
5,116
Average other acquired intangibles
1
339
374
482
Average related deferred tax liabilities
(246)
(230)
(237)
Average tangible common equity
96,405
95,981
81,567
Net income available to common
shareholders – reported
3,942
3,089
2,707
Amortization of acquired intangibles, net of income
taxes
26
26
52
Net income available to common shareholders
adjusted for amortization of acquired intangibles,
net of income taxes
3,968
3,115
2,759
Other items of note, net of income taxes
147
599
778
Net income available to common shareholders
– adjusted
$
4,115
$
3,714
$
3,537
Return on tangible common equity
16.3
%
12.9
%
13.4
%
Return on tangible common equity – adjusted
16.9
15.4
17.2
1
Excludes intangibles relating to software and asset servicing rights.
TD BANK GROUP • FIRST QUARTER 2026
• EARNINGS NEWS RELEASE
Page 10
HOW OUR BUSINESSES PERFORMED
For management reporting purposes, the Bank’s business
operations and activities are organized around
the following four key business segments:
Canadian
Personal and Commercial Banking, U.S. Banking,
Wealth Management and Insurance, and Wholesale
Banking. The Bank’s other activities are grouped
into the
Corporate segment.
Results of each business segment reflect revenue,
expenses, assets, and liabilities generated
by the businesses in that segment. Where
applicable,
the Bank
measures and evaluates the performance of
each segment based on adjusted results
and ROE, and for those segments,
the Bank indicates that the measure is
adjusted. For further details, refer to the “How
We Performed”
section of this document, the “Business
Focus”
section in the Bank’s 2025 MD&A, and Note
27 of
the Bank’s Annual Consolidated Financial
Statements for the year ended October 31,
2025.
PCL related to performing (Stage 1 and Stage
2) and impaired (Stage 3) financial assets, loan
commitments, and financial guarantees is recorded
within the
respective segment.
Net interest income within Wholesale Banking
is calculated on a taxable equivalent basis
(TEB), which means that the value of non-taxable
or tax-exempt
income, including certain dividends, is adjusted
to its equivalent pre-tax value. Using
TEB allows the Bank to measure income from
all securities and loans
consistently and makes for a more meaningful
comparison of net interest income with similar
institutions. The TEB increase to net interest income
and provision for
income taxes reflected in Wholesale Banking
results is reversed in the Corporate segment.
The TEB adjustment for the quarter was $17
million, compared with
$17 million in the prior quarter and $15 million
in the first quarter last year.
The Bank’s U.S. strategic cards portfolio is comprised
of agreements with certain U.S. retailers
pursuant to which TD is the U.S. issuer
of private label and co-
branded consumer credit cards to their U.S.
customers. Under the terms of the individual
agreements, the Bank and the retailers
share in the profits generated by
the relevant portfolios after credit losses.
Under IFRS, TD is required to present the gross
amount of revenue and PCL related to these
portfolios in the Bank’s
Interim Consolidated Statement of Income.
At the segment level, the retailer program
partners’ share of revenues and credit
losses is presented in the Corporate
segment, with an offsetting amount (representing
the partners’ net share) recorded in non-interest
expenses, resulting in no impact to Corporate’s
reported net
income (loss). The net income included in
the U.S. Banking segment includes only
the portion of revenue and credit losses attributable
to TD under the
agreements.
Effective the first quarter of 2026, non-interest income
within U.S. Banking is adjusted for the Bank’s
share of losses from community-based
tax-advantaged
investments accounted for using the equity
method which are reclassified to provision for income
taxes. This allows the Bank to measure the
effective tax rate for
U.S. Banking consistently with similar institutions.
The adjustment between non-interest income
and provision for income taxes reflected in
U.S. Banking results is
reversed in the Corporate segment. Comparative
amounts have been reclassified to conform
with the presentation adopted in the current period.
On February 12, 2025, the Bank sold its entire
remaining equity investment in Schwab.
Prior to the sale, the Bank accounted
for its investment in Schwab using
the equity method and the share of net income
from investment in Schwab was reported in
the U.S. Banking segment. Amounts for amortization
of acquired
intangibles,
the acquisition and integration charges related
to the Schwab transaction, and the Bank’s share
of restructuring and other charges incurred
by Schwab
were recorded in the Corporate segment.
Beginning in the third quarter of fiscal 2025,
the U.S. Banking segment no longer includes
contributions from Schwab
and consequently discussions of the U.S. Banking
segment’s performance exclude Schwab.
TD BANK GROUP • FIRST QUARTER 2026
• EARNINGS NEWS RELEASE
Page 11
9
TABLE 7: CANADIAN PERSONAL AND COMMERCIAL BANKING
(millions of Canadian dollars, except
as noted)
For the three months ended
January 31
October 31
January 31
2026
2025
2025
Net interest income
$
4,394
$
4,304
$
4,135
Non-interest income
1,027
1,001
1,014
Total revenue
5,421
5,305
5,149
Provision for (recovery of) credit losses –
impaired
424
447
459
Provision for (recovery of) credit losses –
performing
12
90
62
Total provision for (recovery of) credit losses
436
537
521
Non-interest expenses
2,147
2,178
2,086
Provision for (recovery of) income taxes
794
725
711
Net income
$
2,044
$
1,865
$
1,831
Selected volumes and ratios
Return on common equity
1
32.1
%
30.4
%
31.4
%
Net interest margin (including on securitized
assets)
2
2.83
2.82
2.81
Efficiency ratio
39.6
41.1
40.5
Number of Canadian retail branches
at period end
1,043
1,051
1,063
Average number of full-time equivalent staff
3
33,660
33,325
32,253
1
Capital allocated to the business segment was 11.5% CET1 Capital.
2
Net interest margin is calculated by dividing net interest income by average interest-earning assets. Average
interest-earning assets used in the calculation of net interest margin is a non-
GAAP financial measure. Refer to “Non-GAAP and Other Financial Measures” in the “How We Performed”
section of this document and the Glossary in the Bank’s first quarter 2026
MD&A for additional information about these metrics.
3
Effective the third quarter of 2025, call center operations have been realigned from the Corporate segment
to the businesses, providing end to end ownership of customer experience.
The change mainly impacts the Canadian Personal and Commercial Banking segment. Average number
of full-time equivalent staff has been restated for comparative periods.
Quarterly comparison – Q1 2026 vs. Q1 2025
Canadian Personal and Commercial
Banking net income for the quarter was
$2,044 million, an increase of $213
million, or 12%, compared with the first quarter
last year, reflecting higher revenue and lower PCL, partially
offset by higher non-interest expenses. The annualized
ROE for the quarter was 32.1%, compared
with 31.4% in the first quarter last year.
Revenue for the quarter was $5,421 million, an
increase of $272 million, or 5%,
compared with the first quarter last year. Net interest income
was $4,394 million,
an increase of $259 million, or 6%, primarily
reflecting volume growth and higher loan
margins. Average loan volumes increased $32 billion,
or 5%, reflecting 5%
growth in personal loans and 6% growth in
business loans. Average deposit volumes increased
$16 billion, or 3%, reflecting 3% growth in personal
deposits and
5% growth in business deposits. Net interest
margin was 2.83%, an increase of 2 basis points
(bps), primarily due to higher margins on loans,
partially offset by
changes in balance sheet mix. Non-interest
income was $1,027 million, an increase of
$13 million, or 1%.
PCL for the quarter was $436 million, a decrease
of $85 million compared with the first quarter
last year. PCL – impaired was $424 million, a decrease of
$35 million, or 8%, largely reflecting lower provisions
in the commercial lending portfolio, partially
offset by credit migration in the consumer lending
portfolios and
volume growth. PCL – performing was $12
million, a decrease of $50 million compared
with the first quarter last year. The performing provisions
this quarter were
largely related to credit migration in the
consumer lending portfolio and volume
growth, partially offset by the impact of a
model update in the other personal
lending portfolio and an improvement to the
macroeconomic forecast.
Total PCL as an annualized percentage of credit volume was 0.28%, a decrease
of 7 bps
compared with the first quarter last year.
Non-interest expenses for the quarter were $2,147
million, an increase of $61 million, or 3%,
compared with the first quarter last
year, primarily reflecting higher
employee-related expenses.
The efficiency ratio for the quarter was 39.6%, compared
with 40.5% in the first quarter last year.
Quarterly comparison – Q1 2026 vs. Q4 2025
Canadian Personal and Commercial
Banking net income for the quarter was
$2,044 million, an increase of $179
million, or 10%, compared with the prior quarter,
primarily reflecting higher revenue, lower PCL
and lower non-interest expenses. The annualized
ROE for the quarter was 32.1%, compared
with 30.4% in the prior
quarter.
Revenue increased $116 million, or 2%, compared with the prior
quarter. Net interest income increased $90 million, or 2%,
reflecting volume growth and higher
loan margins. Average loan volumes increased $9
billion, or 1%, reflecting 1% growth in personal
loans and 2% growth in business loans.
Average deposit
volumes increased $6 billion, or 1%, reflecting
1% growth in personal deposits and
2% growth in business deposits. Net interest
margin was 2.83%, an increase of
1 basis point (bp), primarily due to higher
margins on loans. As we look forward to
the second quarter, we expect net interest margin to be relatively
stable
.
Non-
interest income increased $26 million, or 3%,
compared with the prior quarter, reflecting business growth.
PCL for the quarter was $436 million, a decrease
of $101 million compared with the prior
quarter. PCL – impaired was $424 million, a decrease of
$23 million, or
5%, largely reflecting lower provisions in
the commercial lending portfolio, partially
offset by credit migration in the consumer lending
portfolios. PCL – performing
was $12 million, a decrease of $78 million compared
with the prior quarter. The performing provisions this quarter
were largely related to credit migration in
the
consumer lending portfolio and volume growth,
partially offset by the impact of a model update
in the other personal lending portfolio and
improvement to the
macroeconomic forecast. Total PCL as an annualized percentage of credit
volume was 0.28%, a decrease of 7 bps
compared with the prior quarter.
Non-interest expenses decreased $31 million, or
1%,
compared with the prior quarter.
The efficiency ratio was 39.6%, compared with 41.1%
in the prior quarter.
9
The Bank’s Q2 2026 net interest margin expectations for the segment are based on the Bank’s assumptions regarding factors such as Bank of Canada rate actions, competitive market dynamics, and
deposit reinvestment rates and maturity profiles, and are subject to inherent risks and uncertainties, including those set out in the “Risk Factors That May Affect Future Results” section of the Bank’s
2025 MD&A and the first quarter 2026 MD&A.
TD BANK GROUP • FIRST QUARTER 2026
• EARNINGS NEWS RELEASE
Page 12
TABLE 8: U.S. BANKING
(millions of dollars, except as noted)
For the three months ended
January 31
October 31
January 31
Canadian Dollars
2026
2025
2025
Net interest income
$
3,296
$
3,165
$
3,064
Non-interest income (loss) – reported
1
789
433
(118)
Non-interest income – adjusted
1,2,3
789
816
809
Total revenue – reported
4,085
3,598
2,946
Total revenue – adjusted
2
4,085
3,981
3,873
Provision for (recovery of) credit losses –
impaired
394
331
529
Provision for (recovery of) credit losses –
performing
(99)
(27)
(78)
Total provision for (recovery of) credit losses
295
304
451
Non-interest expenses – reported
2,468
2,500
2,380
Non-interest expenses – adjusted
2,4
2,512
2,500
2,380
Provision for (recovery of) income taxes – reported
1
282
75
(28)
Provision for (recovery of) income taxes – adjusted
1,2
271
170
203
U.S. Banking net income excluding Schwab
– reported
1,040
719
143
U.S. Banking net income excluding Schwab
– adjusted
2
1,007
1,007
839
Share of net income from investment in
Schwab
5,6
–
–
199
U.S. Banking net income – reported
$
1,040
$
719
$
342
U.S. Banking net income – adjusted
2
1,007
1,007
1,038
U.S. Dollars
Net interest income
$
2,372
$
2,281
$
2,160
Non-interest income (loss) – reported
1
569
315
(82)
Non-interest income – adjusted
1,2,3
569
589
570
Total revenue – reported
2,941
2,596
2,078
Total revenue – adjusted
2
2,941
2,870
2,730
Provision for (recovery of) credit losses –
impaired
284
238
371
Provision for (recovery of) credit losses –
performing
(72)
(18)
(53)
Total provision for (recovery of) credit losses
212
220
318
Non-interest expenses – reported
1,778
1,801
1,675
Non-interest expenses – adjusted
2,4
1,810
1,801
1,675
Provision for (recovery of) income taxes – reported
1
204
55
(20)
Provision for (recovery of) income taxes – adjusted
1,2
196
123
143
U.S. Banking net income excluding Schwab
– reported
747
520
105
U.S. Banking net income excluding Schwab
– adjusted
2
723
726
594
Share of net income from investment in
Schwab
5,6
–
–
142
U.S. Banking net income – reported
$
747
$
520
$
247
U.S. Banking net income – adjusted
2
723
726
736
Selected volumes and ratios
U.S. Banking return on common equity excluding
Schwab – reported
7
9.9
%
6.7
%
1.3
%
U.S. Banking return on common equity excluding
Schwab – adjusted
2,7
9.6
9.3
7.5
U.S. Banking return on common equity – reported
7
9.9
6.7
2.9
U.S. Banking return on common equity – adjusted
2,7
9.6
9.3
8.6
Net interest margin
2,8
3.38
3.25
2.86
Efficiency ratio – reported
1
60.5
69.4
80.6
Efficiency ratio – adjusted
1,2
61.5
62.8
61.4
Assets under administration (billions of U.S.
dollars)
9
$
47
$
46
$
43
Assets under management (billions of U.S.
dollars)
9
11
10
9
Number of U.S. banking stores
1,049
1,100
1,134
Average number of full-time equivalent staff
29,877
29,158
28,276
1
Effective the first quarter of 2026, non-interest income within U.S. Banking is adjusted
for the Bank’s share of losses from community-based tax-advantaged investments
accounted for
using the equity method which are reclassified to provision for income taxes. The adjustment between non-interest
income and provision for income taxes reflected in U.S. Banking results
is reversed in the Corporate segment. The adjustment for the quarter was $184 million (US$132 million),
compared with $145 million (US$105 million) in the prior quarter and $164 million
(US$116 million) in the first quarter last year.
Comparative amounts have been reclassified to conform with the presentation adopted in the current period.
2
For additional information about the Bank’s use of non-GAAP financial measures, refer to “Non-GAAP
and Other Financial Measures” in the “How We Performed” section,
and the
Glossary in the Bank’s first quarter 2026 MD&A.
3
Adjusted non-interest income excludes the following item of note:
i.
Balance sheet restructuring – Q4 2025: $383 million or US$274 million ($288 million or US$206 million after-tax),
Q1 2025: $927 million or US$652 million ($696 million or
US$489 million after-tax).
4
Adjusted non-interest expenses exclude the following item of note:
i.
FDIC special assessment – Q1 2026: ($44) million or US($32)
million (($33) million or US($24) million after-tax).
5
The Bank’s share of Schwab’s earnings was reported with a one-month lag. Refer to
Note 7 of the Bank’s first quarter 2026 Interim Consolidated Financial Statements for
further details.
6
The after-tax amount for amortization of acquired intangibles was recorded in the Corporate segment.
7
Capital allocated to the business segment was 11.5% CET1
Capital.
8
Net interest margin is calculated by dividing U.S. Banking segment’s net interest income
by average interest-earning assets excluding the impact related to sweep deposits arrangements
and the impact of intercompany deposits and cash collateral, which management believes better reflects segment
performance. In addition, the value of tax-exempt interest income is
adjusted to its equivalent before-tax value. For investment securities, the adjustment to fair value is included in the
calculation of average interest-earning assets. Net interest income and
average interest-earning assets used in the calculation are non-GAAP financial measures.
9
For additional information about this metric, refer to the Glossary in the Bank’s first quarter
2026 MD&A.
Quarterly comparison – Q1 2026 vs. Q1 2025
U.S. Banking reported net income was $1,040
million (US$747 million), an increase of
$897 million (US$642 million), compared
with the first quarter last year, and
U.S. Banking adjusted net income was $1,007
million (US$723 million), an increase of
$168 million (US$129 million), compared
with the first quarter last year, both
reflecting the impact of U.S. balance
sheet restructuring activities and lower PCL,
partially offset by higher governance and
control investments, including costs for
U.S. BSA/AML remediation in
the current quarter,
and higher employee-related expenses.
The reported and adjusted annualized
ROE for the quarter were 9.9%
and 9.6%, respectively, compared with
1.3% and 7.5%, respectively, in the
first quarter last year.
Reported and adjusted revenue for the quarter
was US$2,941 million, an increase of US$863
million, or 42%, on a reported basis, and an
increase of
US$211 million, or 8%, on an adjusted basis,
compared with the first quarter last year. Net
interest income of US$2,372 million, increased
US$212 million, or 10%,
TD BANK GROUP • FIRST QUARTER 2026
• EARNINGS NEWS RELEASE
Page 13
10
11
12
largely reflecting higher product margins and
the impact of U.S. balance sheet restructuring
activities. Net interest margin of 3.38%,
increased 52 bps, due to
higher product margins, the impact of U.S.
balance sheet restructuring activities, and
the normalization of elevated liquidity levels (which
positively impacted net
interest margin by 19 bps). Reported and
adjusted non-interest income was US$569
million, an increase of US$651 million,
on a reported basis, compared with
the first quarter last year, reflecting the impact
of U.S. balance sheet restructuring activities
in the first quarter last year. On an adjusted
basis, non-interest income
was relatively flat compared with the
first quarter last year.
Average loan volumes decreased US$18
billion, or 9%, compared with the first quarter
last year. Personal loans decreased 7% and business
loans decreased
11%, reflecting U.S. balance sheet restructuring
activities. Excluding the impact of
the loan portfolios identified for sale or run-off under
our U.S. balance sheet
restructuring program, core average loan
volumes increased US$3 billion, or 2%
,
. Average deposit volumes
decreased US$14 billion, or 4%, reflecting
a 13%
decrease in sweep deposits, a 2% decrease in
personal deposits, and a 1% decrease
in business deposits.
Assets under administration (AUA) were US$47
billion as at January 31, 2026, an increase
of US$4 billion, or 9%, compared with the
first quarter last year, and
assets under management (AUM) were US$11
billion as of January 31, 2026, an increase
of US$2 billion, or 22%, compared with
the first quarter last year, both
reflecting net asset growth and market appreciation.
PCL for the quarter was US$212
million, a decrease of US$106 million
compared with the first quarter last year. PCL
– impaired was US$284 million, a decrease
of US$87 million, or 23%, reflecting lower provisions
in both the consumer and commercial lending
portfolios. PCL – performing was
a recovery of US$72 million,
compared with a recovery of US$53 million
in the first quarter last year. The performing
recovery this quarter largely reflects an
improvement to the
macroeconomic forecast and migration
from performing to impaired in the commercial
lending portfolio. U.S. Banking PCL
including only the Bank’s share of PCL
in the U.S. strategic cards portfolio, as an
annualized percentage of credit volume
was 0.49%, a decrease of 18 bps compared
with the first quarter last year.
Reported non-interest expenses for the quarter were
US$1,778 million, an increase of US$103
million, or 6%, compared to the first quarter
last year, reflecting
higher governance and control investments including
costs of US$148 million for U.S. BSA/AML
remediation, and higher employee-related
expenses, partially
offset by the expense recovery of the FDIC
special assessment charge.
Adjusted non-interest expenses for the quarter
were US$1,810 million, an increase of
US$135 million, or 8%, reflecting higher governance
and control investments, including costs for U.S.
BSA/AML remediation, and higher employee-related
expenses.
The reported and adjusted efficiency ratios
for the quarter were 60.5% and 61.5%, respectively,
compared with 80.6% and 61.4%, respectively,
in the first
quarter last year.
Quarterly comparison – Q1 2026 vs. Q4 2025
U.S. Banking reported net income was $1,040
million (US$747 million), an increase of
$321 million (US$227 million), or 45% (44%
in U.S. dollars), compared with
the prior quarter, primarily reflecting the impact
of U.S. balance sheet restructuring activities
in the prior quarter, an adjustment for client
deposit rates in the prior
quarter, and the expense recovery of the FDIC
special assessment charge in the current
quarter, partially offset by higher employee-related
expenses and lower
fee income.
U.S. Banking adjusted net income was $1,007
million (US$723 million), relatively flat
compared to the prior quarter, primarily
reflecting higher
employee-related expenses and lower fee income,
largely offset by an adjustment for client deposit
rates in the prior quarter. The reported
and adjusted
annualized ROE for the quarter were 9.9%
and 9.6%, respectively, compared with
6.7% and 9.3%, respectively, in the prior
quarter.
Reported and adjusted revenue for the quarter
was US$2,941 million, an increase of US$345
million, or 13%, on a reported basis, and an
increase of
US$71 million, or 2%, on an adjusted basis,
compared with the prior quarter. Net interest
income of US$2,372 million, increased US$91
million, or 4%, largely
reflecting an adjustment for client deposit
rate in the prior quarter and higher loan margins
in the current quarter. Reported net interest
margin of 3.38%, increased
13 bps, due to an adjustment for client deposit
rates in the prior quarter and higher loan margins
from improved product mix. Net interest margin
is expected to
modestly increase
in the second quarter of fiscal 2026
. Reported and adjusted non
-
interest income was US$569 million, an
increase of US$254
million, or 81%,
on a reported basis, reflecting the impact
of U.S. balance sheet restructuring activities
in the prior quarter, partially offset by lower
fee income. On an adjusted
basis, non-interest income decreased US$20
million, or 3%, reflecting lower fee
income.
Average loan volumes decreased US$2
billion, or 1%, compared with the prior
quarter, reflecting a 3% decrease in business
loans, partially offset by a 1%
increase in personal loans. Excluding
the impact of the loan portfolios identified for
sale or run-off under our U.S. balance sheet
restructuring program, core
average loan volumes increased US$1 billion,
or 1%
10
,11
.
Average deposit volumes decreased
US$5 billion, or 2%, compared with the
prior quarter, reflecting a 5%
decrease in sweep deposits. Personal deposits
and business deposits are relatively
flat compared to the prior quarter.
AUA were US$47 billion as
at January 31, 2026, an increase of US$1
billion, or 2%, compared with the prior quarter,
and AUM were US$11
billion as at
January 31, 2026, an increase of US$1 billion
or 10%, compared with the prior quarter,
both reflecting net asset growth and market
appreciation.
PCL for the quarter was US$212
million, a decrease of US$8 million compared
with the prior quarter. PCL – impaired
was US$284
million, an increase of
US$46 million, or 19%, largely reflecting
higher provisions in the commercial lending
portfolio. PCL – performing was
a recovery of US$72
million, compared with a
recovery of US$18 million in the prior quarter.
The performing recovery this quarter largely
reflects an improvement to the macroeconomic
forecast and migration
from performing to impaired in the commercial
lending portfolio. U.S. Banking PCL
including only the Bank’s share of PCL
in the U.S. strategic cards portfolio, as
an annualized percentage of credit volume was
0.49%, a decrease of 1 bp compared
with the prior quarter.
Reported non-interest expenses for the quarter were
US$1,778 million, a decrease of US$23
million, or 1%, compared with the prior quarter,
reflecting the
expense recovery of the FDIC special assessment
charge, partially offset by higher employee-related
expenses. Adjusted non-interest
expenses for the quarter
were US$1,810 million, an increase of US$9
million, compared with the prior quarter,
reflecting higher employee-related costs.
The reported and adjusted efficiency ratios
for the quarter were 60.5% and 61.5%, respectively,
compared with 69.4% and 62.8%, respectively,
in the prior
period.
Following the end of the first quarter of fiscal
2026,
the Bank completed the conversion of its
Nordstrom credit card portfolio onto the Bank’s servicing
platform. The
Bank became the servicer of the portfolio
and will receive a greater share of revenue
and credit losses.
The Bank expects a charge of approximately
US$145 million pre-tax, reflecting an adjustment
of amounts to be recovered from Nordstrom
for future credit losses,
to be recorded as an Item of Note in the
second quarter of fiscal 2026.
10
Loan portfolios identified for sale or run-off include the Point-of-Sale finance business which services third
party retailers, correspondent lending, export and import lending, commercial
auto dealer portfolio, and other non-core portfolios. Q1 2026 average loan volumes: US$175 billion (Q4 2025: US$177
billion; Q1 2025: US$192
billion). Q1 2026 average loan volumes
of loan portfolios identified for sale or run-off: US$11
billion (Q4 2025: US$14 billion; Q1 2025: US$32 billion). Q1 2026 average loan volumes excluding loan
portfolios identified for sale
or run-off: US$164 billion (Q4 2025: US$163
billion; Q1 2025: US$160 billion).
11
For additional information about the Bank’s use of non-GAAP financial measures, refer to “Non-GAAP and Other Financial Measures”
in the “How We Performed” section of this
document.
12
The Bank’s Q2 2026 net interest margin expectations for the segment are based on the Bank’s assumptions regarding
interest rates, deposit reinvestment rates, average asset levels,
execution of planned restructuring opportunities, and other variables, and are subject to inherent risks and uncertainties,
including those set out in the “Risk Factors That May Affect
Future Results” section of this document.
TD BANK GROUP • FIRST QUARTER 2026
• EARNINGS NEWS RELEASE
Page 14
TABLE 9: WEALTH MANAGEMENT AND INSURANCE
(millions of Canadian dollars, except
as noted)
For the three months ended
January 31
October 31
January 31
2026
2025
2025
Net interest income
$
406
$
389
$
369
Non-interest income
3,500
3,399
3,229
Total revenue
3,906
3,788
3,598
Insurance service expenses
1
1,622
1,602
1,507
Non-interest expenses
1,258
1,239
1,173
Provision for (recovery of) income taxes
269
248
238
Net income
$
757
$
699
$
680
Selected volumes and ratios
Return on common equity
45.3
%
43.1
%
42.7
%
Return on common equity – Wealth Management
2
66.3
66.3
61.9
Return on common equity – Insurance
22.7
18.1
21.9
Efficiency ratio
32.2
32.7
32.6
Efficiency ratio, net of ISE
3
55.1
56.7
56.1
Assets under administration (billions of Canadian
dollars)
4
$
771
$
759
$
687
Assets under management (billions of Canadian
dollars)
610
601
556
Average number of full-time equivalent staff
15,872
15,829
15,176
1
Includes estimated losses related to catastrophe claims – Q1 2026: $7 million, Q4 2025: $15 million, Q1 2025: nil
.
2
Capital allocated to the business was 11.5% CET1 Capital.
3
Efficiency ratio, net of ISE is calculated by dividing non-interest expenses by total revenue, net of ISE.
Total revenue, net of ISE
– Q1 2026: $2,284 million, Q4 2025: $2,186 million,
Q1 2025: $2,091 million. Total revenue,
net of ISE is a non-GAAP financial measure. Refer to “Non-GAAP and Other Financial Measures” in the
“How We Performed” section and the
Glossary in the Bank’s first quarter 2026 MD&A for additional information about this metric.
4
Includes
AUA administered by TD Investment Services Inc. which is part of the Canadian Personal and Commercial
Banking segment.
Quarterly comparison – Q1 2026 vs. Q1 2025
Wealth Management and Insurance net income
for the quarter was $757 million, an increase
of $77 million, or 11%, compared with the first quarter last year,
reflecting Wealth Management net income of
$574 million, an increase of $62 million,
or 12%, compared with the first quarter
last year, and Insurance net income
of $183 million, an increase of $15 million, or 9%,
compared with the first quarter last year. The annualized
ROE for the quarter was 45.3%, compared
with 42.7%
in the first quarter last year. Wealth Management annualized ROE
for the quarter was 66.3%, compared
with 61.9% in the first quarter last year, and Insurance
annualized ROE for the quarter was 22.7%
compared with 21.9% in the first quarter last
year.
Revenue for the quarter was $3,906 million, an increase
of $308 million, or 9%, compared
with the first quarter last year. Non-interest income was
$3,500 million, an increase of $271 million, or
8%, reflecting higher insurance earned
premiums, fee-based revenues
from asset growth, and transaction revenue.
Net interest income was $406 million, an increase
of $37 million, or 10%, compared
with the first quarter last year, reflecting higher deposit
volumes.
AUA were $771 billion as at January 31, 2026,
an increase of $84 billion, or 12%, and AUM
were $610 billion as at January 31, 2026,
an increase of $54 billion,
or 10%, compared with the first quarter last
year, both reflecting market appreciation and net asset growth.
Insurance service expenses for the quarter
were $1,622 million, an increase of $115 million, or 8%, compared
with the first quarter last year, primarily reflecting
increased claims severity.
Non-interest expenses for the quarter were $1,258
million, an increase of $85 million, or
7%, compared with the first quarter
last year, reflecting higher variable
compensation commensurate with higher
revenue, increased technology investments,
and higher employee-related expenses.
The efficiency ratio for the quarter was 32.2%,
compared with 32.6% in the first quarter
last year. The efficiency ratio, net of ISE for the quarter was
55.1%,
compared with 56.1% in the first quarter last
year.
Quarterly comparison – Q1 2026 vs. Q4 2025
Wealth Management and Insurance net income
for the quarter was $757 million, an increase
of $58 million, or 8%, compared with the prior
quarter, reflecting
Wealth Management net income of $574 million,
an increase of $17 million, or 3%, compared
with the prior quarter, and Insurance net income of $183 million,
an
increase of $41 million, or 29%, compared
with the prior quarter. The annualized ROE for the quarter
was 45.3%, compared with 43.1% in the prior quarter. Wealth
Management annualized ROE for the quarter
was 66.3%, flat to the prior quarter, and Insurance annualized
ROE for the quarter was 22.7% compared
with 18.1%
in the prior quarter.
Revenue increased $118 million, or 3%, compared with the prior
quarter. Non-interest income increased $101 million, or
3%, reflecting strong underlying
insurance performance and higher fee-based revenues.
Net interest income increased $17 million, or
4%, reflecting higher deposit volumes.
AUA increased $12 billion, or 2%, and AUM
increased $9 billion, or 1%, compared
with the prior quarter, both reflecting market appreciation.
Insurance service expenses were relatively
flat compared with the prior quarter.
Non-interest expenses for the quarter were $1,258
million, an increase of $19 million, or
2%, compared with the prior quarter, primarily reflecting higher
variable
compensation commensurate with higher
revenue.
The efficiency ratio for the quarter was 32.2%,
compared with 32.7% in the prior quarter. The efficiency ratio,
net of ISE for the quarter was 55.1%, compared
with 56.7% in the prior quarter.
TD BANK GROUP • FIRST QUARTER 2026
• EARNINGS NEWS RELEASE
Page 15
TABLE 10: WHOLESALE BANKING
(millions of Canadian dollars, except
as noted)
For the three months ended
January 31
October 31
January 31
2026
2025
2025
Net interest income (loss) (TEB)
$
(75)
$
(66)
$
(107)
Non-interest income
2,545
2,266
2,107
Total revenue
2,470
2,200
2,000
Provision for (recovery of) credit losses –
impaired
216
28
33
Provision for (recovery of) credit losses –
performing
(44)
(4)
39
Total provision for (recovery of) credit losses
172
24
72
Non-interest expenses – reported
1,563
1,559
1,535
Non-interest expenses – adjusted
1,2
1,563
1,515
1,483
Provision for (recovery of) income taxes
(TEB) – reported
174
123
94
Provision for (recovery of) income taxes
(TEB) – adjusted
1
174
132
105
Net income – reported
$
561
$
494
$
299
Net income – adjusted
1
561
529
340
Selected volumes and ratios
Trading-related revenue (TEB)
3
$
1,146
$
865
$
904
Average gross lending portfolio (billions of Canadian
dollars)
4
93.9
90.0
100.9
Return on common equity – reported
5
12.6
%
11.6
%
7.3
%
Return on common equity – adjusted
1,5
12.6
12.4
8.3
Efficiency ratio – reported
63.3
70.9
76.8
Efficiency ratio – adjusted
1
63.3
68.9
74.2
Average number of full-time equivalent staff
7,334
7,438
6,919
1
For additional information about the Bank’s use of non-GAAP financial measures, refer to “Non-GAAP
and Other Financial Measures” in the “How We Performed” section,
and the
Glossary in the Bank’s first quarter 2026 MD&A.
2
Adjusted non-interest expenses exclude the acquisition and integration-related charges for the Cowen acquisition
– Q4 2025: $44 million ($35 million after tax), Q1 2025: $52 million
($41 million after tax).
3
Includes net interest income (loss) TEB of ($455) million, (Q4 2025: ($419) million, Q1 2025: ($404) million),
and trading income (loss) of $1,601 million (Q4 2025: $1,284 million,
Q1 2025: $1,308 million). Trading-related revenue (TEB) is a non-GAAP financial
measure. Refer to “Non-GAAP and Other Financial Measures” in the “How We Performed”
section and
the Glossary in the Bank’s first quarter 2026
MD&A for additional information about this metric.
4
Includes gross loans relating to Wholesale Banking, excluding letters of credit, cash collateral, credit default swaps,
and allowance for credit losses.
5
Capital allocated to the business segment was 11.5% CET1 Capital.
Quarterly comparison – Q1 2026 vs. Q1 2025
Wholesale Banking reported and adjusted net
income for the quarter were $561
million. Reported net income for the quarter
increased $262 million, or 88%,
compared with the first quarter last year, primarily reflecting
higher revenues, partially offset by higher PCL
and non-interest expenses. On an
adjusted basis, net
income increased
$221 million, or 65%, compared with the
first quarter last year.
Revenue for the quarter was $2,470 million, an
increase of $470 million, or 24%,
compared with the first quarter last year. Higher revenue
primarily reflects
higher trading-related revenue, lending revenue,
advisory fees, and underwriting fees,
partially offset by the net change in fair value of
loan underwriting
commitments.
PCL for the quarter was $172 million, an increase
of $100 million compared with the first
quarter last year. PCL – impaired was $216
million, an increase of
$183 million compared with the prior
year, primarily reflecting a small number of impairments across
various industries. PCL – performing was
a recovery of
$44 million, compared with a build of $39
million in the prior year. The performing recovery this quarter
was driven by migration from performing to impaired.
Reported non-interest expenses for the quarter
were $1,563 million, an increase of $28
million, or 2%, compared with the first quarter
last year, primarily
reflecting higher operating costs, including technology
and front office, spend supporting business
growth, and higher variable compensation,
partially offset by the
cessation of acquisition and integration-related
costs. On an adjusted basis, non-interest expenses
were $1,563 million, an increase of $80 million,
or 5%.
Quarterly comparison – Q1 2026 vs. Q4 2025
Wholesale Banking reported and adjusted net
income for the quarter were $561
million. Reported net income increased
$67 million, or 14%, compared with the
prior quarter, primarily reflecting higher revenues, partially offset by
higher PCL and non-interest expenses.
On an adjusted basis, net income increased
$32 million, or 6%.
Revenue for the quarter increased $270 million,
or 12%, compared with the prior quarter. Higher revenue
primarily reflects higher trading-related
revenue,
lending revenue,
and net change in fair value of the equity
investment portfolio, partially offset by lower underwriting
and advisory fees.
PCL for the quarter was $172 million, an increase
of $148 million compared with the prior quarter. PCL – impaired
was $216
million, an increase of $188 million,
primarily reflecting a small number of impairments
across various industries. PCL – performing
was a recovery of $44 million, compared
with a recovery of
$4 million in the prior quarter. The performing recovery this
quarter was driven by migration from performing
to impaired.
Reported non-interest expenses for the quarter
increased $4 million, relatively flat
compared with the prior quarter, primarily reflecting higher
variable
compensation, partially offset by higher acquisition
and integration-related costs and higher
spend supporting business growth in the prior
quarter. On an adjusted
basis, non-interest expenses increased $48
million, or 3%.
TD BANK GROUP • FIRST QUARTER 2026
• EARNINGS NEWS RELEASE
Page 16
TABLE 11: CORPORATE
(millions of Canadian dollars)
For the three months ended
January 31
October 31
January 31
2026
2025
2025
Net income (loss) – reported
$
(359)
$
(497)
$
(359)
Adjustments for items of note
Amortization of acquired intangibles
34
34
61
Restructuring charges
200
190
–
Impact from the terminated FHN acquisition-related
capital hedging strategy
44
49
54
Balance sheet restructuring
–
102
–
Less: impact of income taxes on items
of note
72
73
22
Net income (loss) – adjusted
1
$
(153)
$
(195)
$
(266)
Decomposition of items included in net
income (loss) – adjusted
Net corporate expenses
1
$
(515)
$
(537)
$
(370)
Other
362
342
104
Net income (loss) – adjusted
1
$
(153)
$
(195)
$
(266)
Selected volumes
Average number of full-time equivalent staff
2
18,098
18,371
17,800
1
For additional information about the Bank’s use of non-GAAP financial measures, refer to “Non-GAAP
and Other Financial Measures” in the “How We Performed” section, and the
Glossary in the Bank’s first quarter 2026 MD&A.
2
Effective the third quarter of 2025, call center operations have been realigned from the Corporate segment
to the businesses, providing end-to-end ownership of customer experience.
The change mainly impacts the Canadian Personal and Commercial Banking segment. Average number
of full-time equivalent staff has been restated for comparative periods.
Quarterly comparison – Q1 2026 vs. Q1 2025
Corporate segment’s reported net loss for the quarter
was $359 million, flat compared with the
first quarter last year. The year-over-year net loss primarily reflects
restructuring charges and higher net corporate
expenses, largely offset by higher revenue
from treasury and balance sheet management
activities. Net corporate
expenses increased $145 million compared
with the first quarter last year, primarily reflecting continued
investments in governance and controls.
The adjusted net
loss for the quarter was $153 million, compared
with $266 million in the prior year.
Quarterly comparison – Q1 2026 vs. Q4 2025
Corporate segment’s reported net loss for the quarter
was $359 million, compared with $497
million in the prior quarter. The lower net loss primarily reflects
the
impact of balance sheet restructuring activities
in the prior quarter. The adjusted net loss for the quarter
was $153 million, compared with $195 million
in the prior
quarter.
TD BANK GROUP • FIRST QUARTER 2026
• EARNINGS NEWS RELEASE
Page 17
SHAREHOLDER AND INVESTOR INFORMATION
Shareholder Services
If you:
And your inquiry relates to:
Please contact:
Are a registered shareholder (your name appears
on your TD share certificate)
Missing dividends, lost share certificates, estate
questions, address changes to the share register,
dividend bank account changes, the dividend
reinvestment plan, eliminating duplicate mailings
of
shareholder materials or stopping (or resuming)
receiving annual and quarterly reports
Transfer Agent:
TSX Trust Company
301-100 Adelaide Street West
Toronto, ON M5H 4H1
1-800-387-0825 (Canada and U.S. only)
or 416-682-3860
Facsimile: 1-888-249-6189
shareholderinquiries@tmx.com or www.tsxtrust.com
Hold your TD shares through the
Direct Registration System
in the United States
Missing dividends, lost share certificates, estate
questions, address changes to the share register,
eliminating duplicate mailings of shareholder
materials or stopping (or resuming) receiving
annual
and quarterly reports
Co-Transfer Agent and Registrar:
Computershare Trust Company, N.A.
P.O. Box 43006
Providence, RI 02940-3006
or
Computershare Trust Company, N.A.
150 Royall Street
Suite 101
Canton, MA 02021
1-866-233-4836
TDD for hearing impaired: 1-800-231-5469
Shareholders outside of U.S.: 201-680-6578
TDD shareholders outside of U.S.: 201-680-6610
Email inquiries: web.queries@computershare.com
For electronic access to your account visit:
www.computershare.com/investor
Beneficially own TD shares that are
held in the
name of an intermediary, such as a bank,
a trust
company, a securities broker or other nominee
Your TD shares, including questions
regarding the
dividend reinvestment plan and mailings of
shareholder materials
Your intermediary
For all other shareholder inquiries, please
contact TD Shareholder Relations at
416-944-6367 or 1-866-756-8936 or email
tdshinfo@td.com. Please note that by
leaving us an e-mail or voicemail message,
you are providing your consent for us to
forward your inquiry to the appropriate party
for response.
Access to Quarterly Results Materials
Interested investors, the media and others
may view the first quarter earnings news release,
results slides, supplementary financial
information, and the Report to
Shareholders on the TD Investor Relations
website at www.td.com/investor/.
Quarterly Earnings Conference Call
TD Bank Group will host an earnings conference
call in Toronto, Ontario on February
26, 2026. The call will be audio webcast
live through TD’s website at
9:30 a.m. ET. The call will feature presentations
by TD executives on the Bank’s
financial results for the first quarter and
discussions of related disclosures,
followed by a question-and-answer period with analysts.
The presentation material referenced
during the call will be available on the
TD website at
www.td.com/investor
on February 26,
2026, in advance of the call.
A listen-only telephone line
is available at 416-855-9085 or 1-800-990-2777
(toll free), passcode
24789#.
The audio webcast and presentations will be
archived at
www.td.com/investor
. Replay of the teleconference will be available
until 11:59 p.m. ET on
March 13, 2026, by calling 289-819-1325 or 1-888-660-6264
(toll free). The passcode is 24789#.
Annual Meeting
Thursday, April 16, 2026
Toronto, Ontario
About TD Bank Group
The Toronto-Dominion Bank and its
subsidiaries are collectively known as
TD Bank Group (“TD” or the “Bank”).
TD is the sixth largest bank in North
America by
assets and serves 28.1 million customers in
four key businesses operating in a number
of locations in financial centres around the globe:
Canadian Personal
and Commercial Banking, including
TD Canada Trust and TD
Auto Finance Canada; U.S. Banking,
including TD Auto Finance
U.S., and TD Wealth (U.S.); Wealth
Management and Insurance, including
TD Wealth (Canada), TD Direct Investing,
and TD Insurance; and Wholesale
Banking, including TD Securities and
TD
Cowen.
TD also ranks among North
America’s leading digital banks,
with more than 13 million active mobile
users in Canada and the U.S.
TD had $2.1 trillion in
assets on January 31, 2026. The
Toronto-Dominion Bank trades under the
symbol “TD” on the Toronto Stock
Exchange and New York Stock Exchange.
For further information contact:
Brooke Hales,
Senior Vice President, Investor Relations,
416-307-8647, Brooke.Hales@td.com
Gabrielle Sukman,
Senior Manager, Corporate and Public
Affairs,
416-983-1854, Gabrielle.Sukman@td.com
ex995
TD BANK GROUP DECLARES DIVIDENDS
(all amounts in Canadian dollars)
TORONTO – February 26, 2026 -
The Toronto
-Dominion Bank (the "Bank") today announced
that a dividend in an amount of one dollar and eight cents
($1.08) per fully paid common share in
the capital stock of the Bank has been declared for the
quarter ending April 30, 2026, payable on
and after April 30, 2026, to shareholders of record at the close
of business on April 9, 2026.
In lieu of receiving their dividends in cash, holders of the Bank’s
common shares may choose to
have their dividends reinvested in additional common shares
of the Bank in accordance with the
Dividend Reinvestment Plan (the “Plan”).
Under the Plan, the Bank has the discretion to either purchase
the additional common shares in
the open market or issue them from treasury.
If issued from treasury,
the Bank may decide to
apply a discount of up to 5% to the Average Market
Price (as defined in the Plan) of the additional
shares.
For the April 30, 2026 dividend, the Bank will purchase
the additional shares in the open
market and therefore no discount will apply.
Registered holders of record of the Bank's common shares
wishing to join the Plan can obtain an
Enrolment Form from TSX Trust
Company (1-800-387-0825) or on the Bank's website,
www.td.com/dividends/drip.
In order to participate in the Plan in time for this
dividend, Enrolment
Forms for registered holders must be received by TSX
Trust Company at P.O.
Box 4229, Postal
Station A, Toronto,
Ontario, M5W 0G1, or by facsimile at 1-888-488-1416, before
the close of
business on April 9, 2026.
Beneficial or non-registered holders of the Bank's common shares
wishing to join the Plan must contact their financial institution
or broker for instructions on how to
enroll in advance of the above date.
Registered holders who participate in the Plan and who wish to
terminate that participation so that
cash dividends to which they are entitled to be paid on and
after April 30, 2026 are not reinvested
in common shares under the Plan must deliver written notice
to TSX Trust Company at the above
address by no later than April 9, 2026.
Beneficial or non-registered holders who participate
in the
Plan and who wish to terminate that participation so that
cash dividends to which they are entitled
to be paid on and after April 30, 2026 are not reinvested in
common shares under the Plan must
contact their financial institution or broker for instructions on how
to terminate participation in the
Plan in advance of April 9, 2026.
The Bank also announced that dividends have been declared
on the following Non-Cumulative
Redeemable Class A First Preferred Shares of the Bank, payable
on and after April 30, 2026, to
shareholders of record at the close of business on April
9, 2026:
●
Series 1, in an amount per share of $0.310625;
●
Series 16, in an amount per share of $0.3938125;
●
Series 18, in an amount per share of $0.3591875;
●
Series 27, in an amount per share of $28.75; and
●
Series 28, in an amount per share of $36.16.
The Bank for the purposes of the Income Tax
Act (Canada) and any similar provincial legislation
advises that the dividend declared for the quarter ending
April 30, 2026 and all future dividends
will be eligible dividends unless indicated otherwise.
About TD Bank Group
The Toronto
-Dominion Bank and its subsidiaries are collectively
known as TD Bank Group ("TD"
or the "Bank"). TD is the sixth largest bank in North America
by assets and serves 28.1 million
clients in four key businesses operating in a number of
locations in financial centres around the
globe: Canadian Personal and Commercial Banking, including
TD Canada Trust and TD Auto
Finance Canada; U.S. Banking, including TD Auto Finance U.S.,
and TD Wealth (U.S.); Wealth
Management and Insurance, including TD Wealth
(Canada), TD Direct Investing, and TD
Insurance; and Wholesale Banking, including TD Securities
and TD Cowen. TD also ranks
among North America's leading digital banks, with more
than 13 million active mobile users in
Canada and the U.S. TD had $2.1 trillion
in assets on January 31, 2026. The Toronto
-Dominion
Bank trades under the symbol "TD" on the Toronto
Stock Exchange and New York
Stock
Exchange.
For more information contact:
Jennifer dela Cruz
Business Management Specialist, Treasury
and
Corporate Securities
Legal Department – Shareholder Relations
(416) 944-6367
Toll
free 1-866-756-8936
Gabrielle Sukman
Senior Manager, Corporate
and Public Affairs
(416) 983-1854
ex996
FORM 52-109F2
CERTIFICATION OF INTERIM FILINGS
FULL CERTIFICATE
I, Raymond Chun, Group President and Chief Executive Officer of The Toronto-
Dominion Bank, certify the following:
1.
Review
: I have reviewed the interim financial report and interim MD&A
(together, the
"interim filings") of The Toronto-Dominion Bank (the "issuer") for the interim period
ended January 31, 2026.
2.
No misrepresentations
: Based on my knowledge, having exercised reasonable
diligence, the interim filings do not contain any untrue statement
of a material fact or omit
to state a material fact required to be stated or that is necessary
to make a statement not
misleading in light of the circumstances under which it was
made, with respect to the
period covered by the interim filings.
3.
Fair presentation
: Based on my knowledge, having exercised reasonable diligence,
the interim financial report together with the other financial information
included in the
interim filings fairly present in all material respects the financial condition,
financial
performance and cash flows of the issuer, as of the date of and for the periods
presented in the interim filings.
4.
Responsibility
: The issuer's other certifying officer(s) and I are responsible for
establishing and maintaining disclosure controls and procedures
(DC&P) and internal
control over financial reporting (ICFR), as those terms are defined
in National Instrument
52-109
Certification of Disclosure in Issuers' Annual and Interim Filings
, for the issuer.
5.
Design
: Subject to the limitations, if any, described in paragraphs 5.2 and 5.3, the
issuer's other certifying officer(s) and I have, as at the end of the period covered
by the
interim filings
(a) designed DC&P,
or caused it to be designed under our supervision, to
provide
reasonable assurance that
(i) material information relating to the issuer is made known
to us by others,
particularly during the period in which the interim filings are being
prepared; and
(ii) information required to be disclosed by the issuer in its annual
filings, interim
filings or other reports filed or submitted by it under securities legislation
is
recorded, processed, summarized and reported within
the time periods specified
in securities legislation; and
(b) designed ICFR, or caused it to be designed under our supervision,
to provide
reasonable assurance regarding the reliability of financial
reporting and the preparation
of financial statements for external purposes in accordance with the
issuer's GAAP.
5.1
Control framework
: The control framework the issuer's other certifying officer(s)
and I used to design the issuer's ICFR is
based on criteria established in Internal Control
– Integrated Framework issued by the Committee of Sponsoring
Organizations of the
Treadway Commission (the COSO criteria) in 2013.
5.2
N/A
5.3
N/A
6.
Reporting changes in ICFR
: The issuer has disclosed in its interim MD&A any
change in the issuer's ICFR that occurred during the period beginning
on November 1,
2025, and ended on January 31, 2026, that has materially
affected, or is reasonably
likely to materially affect, the issuer's ICFR.
Date: February 26, 2026
/s/ Raymond Chun
Raymond Chun
Group President and Chief Executive Officer
FORM 52-109F2
CERTIFICATION OF INTERIM FILINGS
FULL CERTIFICATE
I, Kelvin Tran, Group Head and Chief Financial Officer of The Toronto-Dominion Bank,
certify the following:
1.
Review
: I have reviewed the interim financial report and interim MD&A
(together, the
"interim filings") of The Toronto-Dominion Bank (the "issuer") for the interim period
ended January 31, 2026.
2.
No misrepresentations
: Based on my knowledge, having exercised reasonable
diligence, the interim filings do not contain any untrue statement
of a material fact or omit
to state a material fact required to be stated or that is necessary
to make a statement not
misleading in light of the circumstances under which it was
made, with respect to the
period covered by the interim filings.
3.
Fair presentation
: Based on my knowledge, having exercised reasonable diligence,
the interim financial report together with the other financial information
included in the
interim filings fairly present in all material respects the financial condition,
financial
performance and cash flows of the issuer, as of the date of and for the periods
presented in the interim filings.
4.
Responsibility
: The issuer's other certifying officer(s) and I are responsible for
establishing and maintaining disclosure controls and procedures
(DC&P) and internal
control over financial reporting (ICFR), as those terms are defined
in National Instrument
52-109
Certification of Disclosure in Issuers' Annual and Interim Filings
, for the issuer.
5.
Design
: Subject to the limitations, if any, described in paragraphs 5.2 and 5.3, the
issuer's other certifying officer(s) and I have, as at the end of the period covered
by the
interim filings
(a) designed DC&P,
or caused it to be designed under our supervision, to
provide
reasonable assurance that
(i) material information relating to the issuer is made known
to us by others,
particularly during the period in which the interim filings are being
prepared; and
(ii) information required to be disclosed by the issuer in its annual
filings, interim
filings or other reports filed or submitted by it under securities legislation
is
recorded, processed, summarized and reported within
the time periods specified
in securities legislation; and
(b) designed ICFR, or caused it to be designed under our supervision,
to provide
reasonable assurance regarding the reliability of financial
reporting and the preparation
of financial statements for external purposes in accordance with the
issuer's GAAP.
5.1
Control framework
: The control framework the issuer's other certifying officer(s)
and I used to design the issuer's ICFR is
based on criteria established in Internal Control
– Integrated Framework issued by the Committee of Sponsoring
Organizations of the
Treadway Commission (the COSO criteria) in 2013.
5.2
N/A
5.3
N/A
6.
Reporting changes in ICFR
: The issuer has disclosed in its interim MD&A any
change in the issuer's ICFR that occurred during the period beginning
on November 1,
2025, and ended on January 31, 2026, that has materially
affected, or is reasonably
likely to materially affect, the issuer's ICFR.
Date: February 26, 2026
/s/ Kelvin Tran
Kelvin Tran
Group Head and Chief Financial Officer