Aug 27, 2026 earnings call — Record quarter and U.S. banking expansion
TD reported record earnings of $4.7 billion and record EPS of $2.77 for Q3.
Revenue $12.1B (est $10.7B) · EPS $1.98 (est $1.74)
Key quotes
"In Q3, the bank delivered a strong quarter with record earnings of $4.7 billion and record EPS of $2.77."
"So we are announcing today that we're planning on opening up 100 stores across our footprint from Maine to Florida and we intend to complete that by the end of calendar 2028."
"Three quarters into the year, we have essentially hit our fiscal 2026 target of $200 million in value from AI."
Analyst Q&A 7
Opening 100 U.S. stores and AML
Q (Matthew Lee · Canaccord Genuity): Analyst asked how the plan to open 100 U.S. stores interacts with the bank's AML remediation. He also asked if the regulatory process or the asset cap constrains branch expansion.
A: Management said they plan to open 100 stores across their footprint by the end of calendar 2028 and feel comfortable doing so given progress on the AML program and discussions with regulators. They stressed the consent order is still in place and that resolving AML remains their #1 priority.
"So we are announcing today that we're planning on opening up 100 stores across our footprint from Maine to Florida and we intend to complete that by the end of calendar 2028." — Leo Salom
Capital use and U.S. loan growth
Q (Gabriel Dechaine · National Bank): Analyst asked what will change in the capital plan targeting a 13% CET1 ratio and noted CET1 fell 50 basis points; he also asked about U.S. loan growth, margin pressure, and NIM outlook.
A: Management said the primary use of capital will be for organic growth, with selective acquisition only if it makes sense and not a priority today. They said excess capital would be returned to shareholders (noting 2027 as a timing), and described accelerating loan growth in the U.S. with a 76% loan-to-deposit ratio and an expectation of modest NIM expansion in 2027.
"But our primary use of the capital will be for organic growth." — Raymond Chun (CEO)
$13 billion buybacks and credit performance
Q (Doug Young · Desjardins): Analyst asked to confirm the $13 billion return to shareholders is buybacks only (incremental to dividends) and how to think about buybacks versus book value. He also asked what drove better-than-expected PCL trends.
A: They confirmed the $13 billion reference was specifically buybacks and said organic growth is the first use of capital, with any excess returned to shareholders and updates coming next quarter. On credit, management said delinquency levels are stable, formations and GILs are down, impaired PCLs are down across most non-Retail portfolios, and the improvement reflects economic resilience plus TD's discipline and underwriting.
"Just on the $13 billion, it is on specifically buybacks." — Raymond Chun (CEO)
Credit discipline and reserves
Q (Mehmed Rizvanovic · Scotiabank): Analyst asked if TD is doing anything unusual or more proactive that explains the recent credit improvement and whether peak credit losses may be behind us. He also asked about mortgage spread dynamics.
A: Management said the improvement comes back to discipline and prudence in underwriting and reserve-setting, noting they were prudent on tariffs and that reserves are 96 bps including $500 million for tariffs. They said it is hard to call a peak but in some ways they may be past it and will provide forecasts next quarter.
"I'd really bring it back to discipline, okay?" — Ajai Bambawale
Mortgage originations and spreads
Q (Sona Mehta · Scotiabank): Analyst asked why mortgage growth was flat sequentially and whether competition compressed spreads or if TD is protecting margins.
A: Management said RESL had a productive quarter driven by speed and specialization, including scaling an agentic AI capability that sped decisions and record proprietary originations. They emphasized they did not compromise profitability, maintained disciplined pricing despite a competitive market, and delivered margin expansion together with volume growth.
U.S. fee income drivers
Q (David Konrad · KBW): Analyst asked what drove the strong, volatile quarter-on-quarter fee income in the U.S. Banking segment ($584 million) and the outlook.
A: Management said part of the headline fee number was understated due to a revenue recognition geography shift from the Nordstrom partnership into NII. They also said core fee lines are growing mid-single-digits year-over-year and highlighted mid-market growth (total balances up 15%, commitments up 9%, transactional fee revenues up 28%) and synergy with the wholesale bank.
"If you look at our mid-market business, which has had a really strong run, total balances are up 15%, commitments this quarter were up 9%, our transactional fee revenues in that subsegment were up 28%." — Leo Salom
Impact of 100 stores on expenses and earnings
Q (Paul Holden · CIBC): Analyst asked how adding roughly 10% more branches (100 stores) will affect PTPP and earnings over the next two years, given day-one expense without revenue.
A: Management said the investments are purposeful: new stores, more retail and commercial bankers (about another 450 bankers), and product focus on core banking, cards, and Commercial Banking. They said they intend to self-fund much of this through productivity and G&C moderation, expect lower expense growth in 2027 than 2026 despite investments, and that structural cost reductions are ahead of plan creating room to fund growth while preserving PTPP and ROE metrics.
"In total, if I add that entire complement, we're probably going to add another 450 bankers to our existing ranks." — Leo Salom