Wednesday, March 15, 2006

TD Banknorth Warns Earnings Estimates 'Too High'

  
Reuters, 15 March 2006

TD Banknorth Inc., a large Northeast U.S. bank, said analysts' consensus forecast for first-quarter profit of 60 cents per share was "too high," leading some analysts to cut their estimates.

Chief Executive William Ryan said at an investor conference on Tuesday that first-quarter profit should be between 55 cents and 60 cents per share. The Portland, Maine-based bank also disclosed its forecast in a U.S. Securities and Exchange Commission filing.

The average analyst estimate, according to Reuters Estimates, on Wednesday called for a profit of 56 cents per share.

Canada's Toronto-Dominion Bank last year paid $4 billion for a 51 percent stake in TD Banknorth.

Analyst Mark Fitzgibbon of Sandler O'Neill & Partners LP cut his estimate for first-quarter profit by 5 cents per share to 55 cents. He cited Ryan's comments that TD Banknorth faces "continued margin pressure as well as a difficult loan and deposit gathering environment."

The Federal Reserve has increased short-term interest rates 14 times since the middle of 2004, but long-term rates have changed little, crimping bank margins.

Earlier this year, TD Banknorth paid about $1.9 billion to purchase Hudson United Bancorp Inc., adding more than 200 branches in New Jersey, Connecticut, New York and Pennsylvania.

In his presentation, Ryan said, "The Hudson United integration is going well, but has delayed some planned initiatives in our existing footprint."
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