A 2013 Top Fifteen CEO Interview from the Wall Street Transcript: How Does Colleen Johnston Group Head of Finance, Sourcing and Communications, and Chief Financial Officer of TD Bank Group Achieve a 10% Total Return?

Wall Street Transcript

67 WALL STREET, New York - December 13, 2013 - The Wall Street Transcript has just published its Top 15 CEO Interviews of 2013 Report. This special feature contains expert industry commentary through in-depth interviews with successful public company CEOs and senior executives. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

Topics covered: Top 15 CEO Interviews of 2013

Companies include: Toronto-Dominion Bank (TD)

In the following excerpt from the Top 15 CEO Interviews of 2013 Report, the Finance Group Head and CFO of TD Bank discusses the outlook for her company for investors:

TWST: Please start by introducing our readers, so to speak, to TD Bank Group with a brief history and an overview of your business today.

Ms. Johnston: We're a large Canadian bank. We're the sixth largest bank in North America. We're largely a retail-oriented bank, with roughly 90% of our earnings coming from retail on both sides of the border, in Canada and in the United States. We have a long history in Canada.

More recently, about eight years ago, we started our expansion into U.S. retail, and we closed our first acquisition of 51% of Banknorth in March of 2005. We've had many follow-on acquisitions, and we've privatized that acquisition. Five years ago, in 2008, we acquired Commerce Bancorp.

So we are a large U.S. bank; we're a top 10 bank in the United States. We have about 1,300 stores in the U.S., which is, in fact, more physical locations than we have in our retail bank in Canada, where we have approximately 1,200. TD has performed very well. We have a conservative risk appetite, and we've posted very strong growth and good total shareholder return.

TWST: Discuss how your revenues break down in terms of the different business lines and subsidiaries.

Ms. Johnston: Why don't I give you more of an earnings view? If you look at our Canadian retail businesses, they comprise about two-thirds of our total earnings, and within that two-thirds you have our Canadian personal and commercial bank - we operate under the name of TD Canada Trust - and that comprises about half of the bank's total earnings.

We have a fantastic retail model. We're the undisputed leaders in service and convenience in Canada. We've had tremendous growth in that business over many years, double-digit growth on average over the last decade or so. Really, that's the backbone of the organization. In addition, in the Canadian retail business we have our insurance business and we have our wealth management business, so on a combined basis, when you add those two businesses and our Canadian personal and commercial bank, they comprise about two-thirds of the bank's total earnings. So we have very strong, high-quality earnings within our home base of Canada.

If you then take our U.S. retail earnings, those are about 20% of our total bank earnings. As I mentioned, that's a new and growing business for us in the United States, and I think we've proven that we have a fantastic business model. Again, service and convenience are incredibly important to our model. We have a 45% interest in TD Ameritrade, which also operates in the United States and has a national presence, and that adds 2% to 3% to our bottom line, and then our wholesale business is about 10% to 15% on average of our total earnings of the bank.

We have made a number of changes to our wholesale business over the last decade or so, and we really adhere to a more client-driven, franchise-driven model...

For more of this interview and many others visit the Wall Street Transcript - a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs, portfolio managers and research analysts. This special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

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