By Ketki Saxena
Investing.com -- TD (TSX:TD), unlike several of its major competitors, delivered results that beat analyst expectations, boosted on higher interest income and strong loan demand in Canada and the U.S.
TD results were also boosted by two large items: a $2.3 billion gain related to its acquisition of First Horizon Corp., and a $997 million gain on the sale of its shares in Charles Schwab (NYSE:SCHW) Corp.
The bank’s adjusted earnings came to $4.06 billion in the three months ending Oct. 31, or $2.18 per share, beating average analyst expectations of $2.07 per share.
TD Bank also raised its quarterly dividend by 7 cents to 96 cents.
TD’s personal and commercial banking led the gains with revenues 16% higher year over year on more client acquisition and activity, and a higher net interest margin (the difference between what the bank earns on loans and what it pays for deposits).
Net interest margin expanded to 1.81% in the fiscal fourth quarter, up 7 basis points from the previous three months. Net interest income rose 76% year over year, boosted by TD’s large base of customers with small loans.
The U.S. retail banking segment rose 9% year over year. Profits in wealth management and insurance fell 15%, pressured by rising growing insurance claims expenses.
The bank set aside $617 million in provisions for credit losses, higher than analysts' expectations for a $503.8 million boost.
TD also pushed back its timeline to close its acquisition of first First Horizon. TD now expects the deal will close by April 30, while it had previously expected to close by January 31.