16 April 2010

TD Bank Buys 3 Failed Banks in Florida

The Wall Street Journal, Robin Sidel, 16 April 2010

Canada's TD Bank Financial Group, accelerating its march on the U.S. banking industry, gobbled up the operations of three failed institutions in Florida.

Regulators also seized two small banks in Michigan and Massachusetts, representing the first bank failures of the year in those two states. So far this year, 47 banks have failed in the U.S.

In Florida, TD acquired the banking operations of AmericanFirst Bank in Clermont, First Federal Bank of North Florida in Palatka, and Riverside National Bank of Florida in Fort Pierce. The three failed institutions weren't affiliated with one another.

The deals come two years after TD significantly bolstered its U.S. presence by acquiring Commerce Bancorp Inc., of Cherry Hill, N.J., which also had a large presence in Florida.

The acquisitions "add quality stores to our existing retail network in target markets, allow us to accelerate our organic growth in Florida by five years, and come with limited downside credit risk," said Ed Clark, chief executive and president of TD.

The largest of the TD deals was for Riverside National, which has 58 branches in Florida, and had assets of $3.42 billion and deposits of $2.76 billion at the end of 2009. AmericanFirst Bank, with three branches, had $90.5 million in assets and total deposits of $81.9 million at the end of 2009. First Federal, with eight branches, had assets of $393.3 million and total deposits of $324.2 million.

TD is assuming all of the deposits from the three Florida banks and will purchase virtually all of their assets. The Canadian bank also entered a loss-sharing agreement on $2.20 billion of the failed institutions' assets with the Federal Deposit Insurance Corp.
Bloomberg, Dakin Campbell and Sean B. Pasternak, 16 April 2010

Toronto-Dominion Bank, Canada’s second-largest lender, agreed to buy three Florida-based financial institutions as those and five other failures brought the number of 2010 closures to 50.

Toronto-Dominion added $3.1 billion in deposits to the $117 billion it holds in two other U.S. lenders, according to a company statement. The lender picked up 69 branches in yesterday’s purchases, bringing its total in Florida to 100.

“These were all in locations that were in our master plan,” for new branches, Toronto-Dominion Chief Executive Officer Edmund Clark said yesterday in a telephone interview. “It would have taken us five years to have built that many branches, so it just speeds up our development.”

Lenders are collapsing amid losses on residential and commercial real estate loans which pushed the FDIC’s list of “problem” banks to the highest level since 1992 in the fourth quarter. Banks in Michigan, Massachusetts, California and Washington state were also closed yesterday by U.S. and state regulators, who named the Federal Deposit Insurance Corp. as receiver, according to statements on the agency’s Web site.

FDIC Chairman Sheila Bair said on Feb. 23 that the pace of failures may exceed last year’s total of 140.

Toronto-Dominion, which has about 1,000 U.S. branches, has spent more than $15 billion over five years buying Portland, Maine-based TD Banknorth and Cherry Hill, New Jersey-based Commerce Bancorp.

The Toronto-based lender acquired the Florida assets and deposits of Clement-based AmericanFirst Bank, First Federal Bank of North Florida in Palatka and Riverside National Bank of Florida of Fort Pierce.
Financial Times, Matthew Vincent, 15 April 2010

TD Waterhouse has overtaken Barclays Stockbrokers to become the number one execution-only stockbroker in the UK by trading volume, according to the latest data from industry analyst Compeer.

Following its acquisitions of OMX Securities and the customers of Hoodless Brennan last year, TD Waterhouse's market share increased to 27 per cent of non-advisory business in the first quarter of 2010, compared with 13 per cent in 2005.

Based on total UK private-client trading volumes of about 3.5m deals between January and March, TD Waterhouse - and the "white-labelled" services it provides under the banner of NatWest Stockbrokers, Computershare and several building societies - handles more than 300,000 trades a month.

"In terms of TD Waterhouse's ranking, in the January and February figures they have moved to number one among the UK execution-only stockbrokers for total trades including white-label business," said James Brown, benchmarking analyst at Compeer.

"These are private client trades and include UK cash market trades, contracts for difference, spread bets, collectives and trades on overseas markets by UK clients."

On Tuesday, TD Waterhouse's parent, Toronto-Dominion Bank, said it had reached an agreement to take full ownership of Internaxx Bank, an online private lender for self-directed international investors. TD has held a stake in Internaxx, which holds £863m in customer assets, since 2000.

The Compeer figures include execution-only deals carried out by Internaxx clients via TD Waterhouse.

Compeer's analysis does not yet reflect trades by the E-Trade customers that TD Waterhouse took over at the start of 2010. But Angus Rigby, TD Waterhouse chief executive, said his company's compound annual trading volume growth, which averaged 20 per cent in the past four years, had been as much a result of organic growth as acquisitions.

"Nothing independently has taken us there," Mr Rigby said. "There have been strategic acquisitions but we also have the best transfer in/transfer out ratio, in terms of new accounts coming in or going out to other broker firms. We average five in to one out."

He attributed the transfers in to the strength of the parent bank. "Being part of a Canadian bank that avoided the financial crisis has never been perceived in such a positive way. Clients changed their focus from chasing the highest return to 'is my money safe?' "

Barclays Stockbrokers said that when white-label trading services were excluded, it remained the UK's most popular execution-only broker.

"Barclays Stockbrokers has a brand that is instantly recognisable among self-directed investors across the country," it said. "That is why we are the UK's largest execution-only online stockbroker."

TD Waterhouse said it would continue to seek acquisitions and clients transferring from other groups.