TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 1
TD Bank Group Reports Third Quarter 2026 Results
Report to Shareholders
Three and nine months ended July 31, 2026
The financial information in this document is reported in Canadian dollars and is based on the Bank’s unaudited Interim Consolidated Financial Statements
prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB), unless
otherwise noted. Certain comparative amounts have been revised to conform with the presentation adopted in the current period.
Reported results conform with generally accepted accounting principles (GAAP), in accordance with IFRS. Adjusted results are non-GAAP financial measures.
For additional information about the Bank’s use of non-GAAP financial measures, refer to “Non-GAAP and Other Financial Measures” in the “How We Performed”,
or “How Our Businesses Performed” sections of this document.
THIRD QUARTER FINANCIAL HIGHLIGHTS, compared with the third quarter last year:
●
Reported diluted earnings per share were $2.74, compared with $1.89.
●
Adjusted diluted earnings per share were $2.77, compared with $2.20.
●
Reported net income was $4,615 million, compared with $3,336 million.
●
Adjusted net income was $4,671 million, compared with $3,871 million.
YEAR-TO-DATE FINANCIAL HIGHLIGHTS, nine months ended July 31, 2026, compared with the corresponding period last year:
●
Reported diluted earnings per share were $7.50, compared with $9.72.
●
Adjusted diluted earnings per share were $7.59, compared with $6.19.
●
Reported net income was $12,909 million, compared with $17,258 million.
●
Adjusted net income was $13,055 million, compared with $11,120 million.
THIRD QUARTER ADJUSTMENTS (ITEMS OF NOTE)
The third quarter reported earnings figures included the following items of note:
●
Amortization of acquired intangibles of $34 million ($25 million after tax or 1 cent per share), compared with $33 million ($25 million after tax or
1 cent per share) in the third quarter last year.
●
Impact from the terminated First Horizon Corporation (FHN) acquisition-related capital hedging strategy of $41 million ($31 million after tax or
2 cents per share), compared with $55 million ($41 million after tax or 2 cents per share) in the third quarter last year.
TORONTO
, August 27, 2026 – TD Bank Group (“TD” or the “Bank”) today announced its financial results for the third quarter ended July 31, 2026. Reported
earnings and earnings per share were $4.6 billion and $2.74, compared with $3.3 billion and $1.89, respectively, in the third quarter last year. Adjusted earnings
and earnings per share were $4.7 billion and $2.77, up 21% and 26%, respectively, year-over-year.
“TD had a very strong quarter, with record earnings in our Canadian businesses and Wholesale Banking, and growing momentum in U.S. Banking,” said Raymond
Chun, Group President and CEO, TD Bank Group. “With a focus on disciplined execution, ROE was up significantly and we generated positive operating leverage
while continuing to invest in front-line talent, AI and innovation to deepen client relationships and grow the Bank. One year after Investor Day, we are delivering on
our commitments, executing our strategy and creating value for our shareholders.”
Canadian Personal and Commercial Banking delivered record revenue, earnings, deposit and loan volumes
Canadian Personal and Commercial Banking net income was $2,095 million, an increase of 7% year-over-year, primarily reflecting higher pre-tax, pre-provision
earnings (PTPP)
. Revenue for the quarter was $5,517 million, up 5% year-over-year, driven by deposit and loan volume growth and higher margins.
Canadian Personal Banking delivered acquisition momentum in day-to-day banking products, including a record Q3 in digital sales, which were up 17% year-
over-year.
The business reinforced its digital leadership, with TD ranking #1 in Customer Satisfaction with Mobile Banking Apps according to JD Power
Business Banking delivered strong deposit and loan growth this quarter, reflecting the benefits of its distribution expansion, and increased commercial client
acquisition by 10% year-to-date.
U.S. Banking results demonstrate earnings power of the franchise
U.S. Banking net income was $1,074 million (US$771 million), an increase of 41% (39% in U.S. dollars) year-over-year on a reported basis, and an increase of
12% (11% in U.S. dollars) year-over-year on an adjusted basis. The segment delivered a return on equity of 10.2%, up 310 basis points year-over-year on a
reported basis, and 130 basis points year-over-year on an adjusted basis, as the business continued to optimize its balance sheet and manage capital with
discipline.
U.S. Banking loans were positive sequentially, reflecting growth in middle market commercial lending and TD's proprietary credit card balances. In U.S. Wealth,
record mass affluent investment assets were driven by net asset growth and market appreciation. TD Auto Finance U.S. was ranked #1 in Dealer Satisfaction
among National Prime Credit Non-Captive Automotive Finance Lenders for the seventh consecutive year in the JD Power 2026 U.S. Dealer Financing Satisfaction
Study
Wealth Management and Insurance delivered record revenue, earnings and assets
Wealth Management and Insurance net income was $841 million, an increase of 20% year-over-year, driven by record assets, higher insurance earned premiums,
and deposit volume growth.
1
PTPP is a non-GAAP financial measure, calculated by subtracting Canadian Personal and Commercial Banking segment’s reported non-interest expenses from reported revenue. Reported revenue –
Q3 2026: $5,517 million, Q3 2025: $5,241 million. Reported non-interest expenses – Q3 2026: $2,131 million, Q3 2025: $2,066 million. PTPP – Q3 2026: $3,386 million, Q3 2025: $3,175 million.
2
For additional information about the Bank’s use of non-GAAP financial measures, refer to “Non-GAAP and Other Financial Measures” in the “How We Performed” section of this document.
3
4
TD received the highest score in the JD Power 2026 Canada Banking Mobile App Satisfaction Study which measures customer satisfaction with financial institutions' mobile applications for banking
account management. Visit jdpower.com/awards for more details.
5
TD Auto Finance U.S. received the highest score in the non-captive national-prime segment in the JD Power 2020-2026 U.S. Dealer Financing Satisfaction Studies of dealers’ satisfaction with automotive
finance providers. Visit jdpower.com/awards for more details.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 2
Wealth Management continued to expand its client base and drive higher engagement, with new accounts up 26% year-over-year. The business continued to gain
momentum among new investors, with average trades per day up 20% year-over-year in TD Direct Investing. TD Insurance and REALTOR.ca launched an
integrated digital experience that brings home insurance guidance into the home-buying journey, helping Canadians make more informed decisions to protect one
of their largest investments.
Wholesale Banking delivered record revenue and earnings
Wholesale Banking net income was $743 million, an increase of 87% year-over-year on a reported basis and 76% year-over-year on an adjusted basis, primarily
reflecting higher revenues and lower PCL, partially offset by higher non-interest expenses.
Wholesale Banking delivered record performance, leveraging the strength of its platform amid heightened client activity and favourable market conditions to
achieve revenue growth of 25% year-over-year. Combined with disciplined expense and capital management, this strong momentum drove a return on equity of
16.7%.
Capital
TD’s Common Equity Tier 1 Capital ratio was 14.3%.
Conclusion
“We enter the final quarter of 2026 from a position of strength, moving with speed to capture the significant growth opportunities across our businesses,” added
Chun. “TD's strong capital position enables us to support our clients' growing needs, invest in our business and return excess capital to our shareholders. I am
proud of what our colleagues have accomplished and thank them for their continued commitment to our clients and our Bank.”
The foregoing contains forward-looking statements. Please refer to the “Caution Regarding Forward-Looking Statements” on page 4.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 3
ENHANCED DISCLOSURE TASK FORCE
The Enhanced Disclosure Task Force (EDTF) was established by the Financial Stability Board (FSB) in 2012 to identify fundamental disclosure principles,
recommendations and leading practices to enhance risk disclosures of banks. The index below includes the recommendations (as published by the EDTF) and
lists the location of the related EDTF disclosures presented in the third quarter 2026 Report to Shareholders (RTS), Supplemental Financial Information (SFI), or
Supplemental Regulatory Disclosures (SRD). Information on TD’s website, SFI, and SRD is not and should not be considered incorporated herein by reference
into the third quarter 2026 RTS, Management’s Discussion and Analysis, or the Interim Consolidated Financial Statements. Certain disclosure references have
been made to the Bank’s 2025 Annual Report.
Type of
Risk
Topic
EDTF Disclosure
Page
RTS
Third
Quarter
2026
SFI
Third
Quarter
2026
SRD
Third
Quarter
2026
Annual Report
2025
General
1
Present all related risk information together in any particular report.
Refer to below for location of disclosures
2
The bank’s risk terminology and risk measures and present key parameter
values used.
92-99, 103, 108,
110, 112,
123-126
3
Describe and discuss top and emerging risks.
82-91
4
Outline plans to meet each new key regulatory ratio once applicable rules
are finalized.
31
78, 120
Risk
Governance
and Risk
Management
and
Business
Model
5
Summarize the bank’s risk management organization, processes, and key
functions.
93-97
6
Description of the bank’s risk culture and procedures applied to support the
culture.
92-93
7
Description of key risks that arise from the bank’s business models and
activities.
77, 92, 98-127
8
Description of stress testing within the bank’s risk governance and capital
frameworks.
75, 97-98, 106,
123
Capital
Adequacy
and Risk
Weighted
Assets
9
Pillar 1 capital requirements and the impact for global systemically important
banks.
29-31,79
1-3, 6
72-74, 79, 235
10
Composition of capital and reconciliation of accounting balance sheet to the
regulatory balance sheet.
1-3, 5
72
11
Flow statement of the movements in regulatory capital.
4
12
Discussion of capital planning within a more general discussion of
management’s strategic planning.
73-76, 123
13
Analysis of how risk-weighted asset (RWA) relate to business activities and
related risks.
9-15
76-77
14
Analysis of capital requirements for each method used for calculating RWA.
13
100-101, 103,
105-106
15
Tabulate credit risk in the banking book for Basel asset classes and major
portfolios.
36-53, 59-65
16
Flow statement reconciling the movements of RWA by risk type.
18-19
17
Discussion of Basel III back-testing requirements.
80
102, 106,
110-111
Liquidity
18
The bank’s management of liquidity needs and liquidity reserves.
37-38, 40-41
112-114, 116 -117
Funding
19
Encumbered and unencumbered assets in a table by balance sheet
category.
39
115, 229
20
Tabulate consolidated total assets, liabilities and off-balance sheet
commitments by remaining contractual maturity at the balance sheet date.
120-122
21
Discussion of the bank’s funding sources and the bank’s funding strategy.
39-40, 42-44
118-120
Market Risk
22
Linkage of market risk measures for trading and non-trading portfolio and
balance sheet.
34
104
23
Breakdown of significant trading and non-trading market risk factors.
34, 36
104, 106-108
24
Significant market risk measurement model limitations and validation
procedures.
35
105-108, 110-111
25
Primary risk management techniques beyond reported risk measures and
parameters.
35
105-108
Credit Risk
26
Provide information that facilitates users’ understanding of the bank’s credit
risk profile, including any significant credit risk concentrations.
26-29, 61-70
23-38
1-5, 13, 18,
20-70, 72-80
59-71, 99-103,
184-191, 201,
203-204, 233-234
27
Description of the bank’s policies for identifying impaired loans.
69
68, 160-161,
167-168, 191
28
Reconciliation of the opening and closing balances of impaired loans in the
period and the allowance for loan losses.
27, 64-68
27, 31
66, 187-189
29
Analysis of the bank’s counterparty credit risks that arise from derivative
transactions.
54-55, 66-70
101, 171-172,
195-197,
201, 203-204
30
Discussion of credit risk mitigation, including collateral held for all sources of
credit risk.
102, 164,
171-172
Other Risks
31
Description of ‘other risk’ types based on management’s classifications and
discuss how each one is identified, governed, measured, and managed.
108-112, 123-127
32
Discuss publicly known risk events related to other risks.
76-77
90-91, 227-229
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 4
TABLE OF CONTENTS
MANAGEMENT’S DISCUSSION AND ANALYSIS
4
Caution Regarding Forward-Looking Statements
45
Accounting Policies and Estimates
5
Financial Highlights
45
Changes in Internal Control over Financial Reporting
6
Update on the Remediation of the U.S. Bank Secrecy Act/Anti-Money
46
Glossary
Laundering Program and Enterprise AML Program
8
How We Performed
INTERIM CONSOLIDATED FINANCIAL STATEMENTS
11
Financial Results Overview
49
Interim Consolidated Balance Sheet
15
How Our Businesses Performed
50
Interim Consolidated Statement of Income
24
Quarterly Results
51
Interim Consolidated Statement of Comprehensive Income
25
Balance Sheet Review
52
Interim Consolidated Statement of Changes in Equity
26
Credit Portfolio Quality
53
Interim Consolidated Statement of Cash Flows
29
Capital Position
54
Notes to Interim Consolidated Financial Statements
32
Risk Factors and Management
32
Managing Risk
45
Securitization and Off-Balance Sheet Arrangements
81
SHAREHOLDER AND INVESTOR INFORMATION
MANAGEMENT’S DISCUSSION AND ANALYSIS OF OPERATING PERFORMANCE
This Management’s Discussion and Analysis (MD&A) is presented to enable readers to assess material changes in the financial condition and operating results of
TD Bank Group (“TD” or the “Bank”) for the three and nine months ended July 31, 2026, compared with the corresponding periods shown. This MD&A should be
read in conjunction with the Bank’s unaudited Interim Consolidated Financial Statements included in this Report to Shareholders and with the 2025 Annual
Consolidated Financial Statements and 2025 MD&A. This MD&A is dated August 26, 2026. Unless otherwise indicated, all amounts are expressed in Canadian
dollars and have been primarily derived from the Bank’s 2025 Annual Consolidated Financial Statements or Interim Consolidated Financial Statements, prepared
in accordance with IFRS as issued by the IASB. Note that certain comparative amounts have been revised to conform with the presentation adopted in the current
period. Additional information relating to the Bank, including the Bank’s 2025 Annual Information Form, is available on the Bank’s website at http://www.td.com as
well as on SEDAR+ at http://www.sedarplus.ca and on the SEC’s website at http://www.sec.gov (EDGAR filers section).
Caution Regarding Forward-Looking Statements
From time to time, the Bank (as defined in this document) makes written and/or oral forward-looking statements, including in this document, in other filings with Canadian regulators or the United States (U.S.) Securities and
Exchange Commission (SEC), and in other communications. In addition, representatives of the Bank may make forward-looking statements orally to analysts, investors, the media, and others. All such statements are made
pursuant to the “safe harbour” provisions of, and are intended to be forward-looking statements under, applicable Canadian and U.S. securities legislation, including the U.S. Private Securities Litigation Reform Act of 1995.
Forward-looking statements include, but are not limited to, statements made in this document, the Management’s Discussion and Analysis (2025 MD&A) in the Bank’s 2025 Annual Report under the heading “Economic
Summary and Outlook”, under the headings “Key Priorities for 2026” and “Operating Environment and Outlook” for the Canadian Personal and Commercial Banking, U.S. Banking, Wealth Management and Insurance, and
Wholesale Banking segments, and in other statements regarding the Bank’s objectives and priorities for 2026 and beyond and strategies to achieve them, the regulatory environment in which the Bank operates, targets and
commitments, the Bank’s anticipated financial performance and the outlook for the Bank’s operations or the Canadian, U.S. and global economies.
Forward-looking statements are typically identified by words such as “will”, “would”, “should”, "suggest", "seek", “believe”, “expect”, “anticipate”, “intend”, "ambition", "strive", "confident", “estimate”, “forecast”, “outlook”,
“plan”, “goal”, "commit", “target”, "objective", "timeline", “possible”, “potential”, “predict”, “project”, "foresee", “may”, and “could” and similar expressions or variations thereof, or the negative thereof, but these terms are not
the exclusive means of identifying such statements. By their very nature, these forward-looking statements require the Bank to make assumptions and are subject to inherent risks and uncertainties, general and specific.
Especially in light of the uncertainty related to the physical, financial, economic, political, and regulatory environments, such risks and uncertainties – many of which are beyond the Bank’s control and the effects of which
can be difficult to predict – may cause actual results to differ materially from the expectations, predictions, forecasts, projections, estimates, targets, or intentions expressed in the forward-looking statements. Examples of
such risk factors include general business and economic conditions in the regions in which the Bank operates; geopolitical risk (including policy, trade and tax-related risks and the potential impact of any new or elevated
tariffs or any retaliatory tariffs); inflation, interest rates and recession uncertainty; risks associated with the remediation of the Bank’s U.S. Bank Secrecy Act (BSA)/anti-money laundering (AML) program and Enterprise AML
program; regulatory oversight and compliance risk; the ability of the Bank to execute on long-term strategies, shorter-term key strategic priorities, including the successful completion of acquisitions and dispositions and
integration of acquisitions, the ability of the Bank to achieve its financial or strategic objectives with respect to its investments, business retention plans, and other strategic plans; risks associated with the insured deposit
account agreement between the Bank and The Charles Schwab Corporation; technology and cyber security risk (including cyber-attacks, data security breaches or technology failures) on the Bank’s technologies, systems
and networks, those of the Bank’s customers (including their own devices), and third parties providing services to the Bank; data risk; model risk; external fraud activity; insider risk; conduct risk; the failure of third parties to
comply with their obligations to the Bank or its affiliates, including relating to the care and control of information, and other risks arising from the Bank’s use of third-parties; the impact of new and changes to, or application
of, current laws, rules and regulations, including consumer protection laws and regulations, tax laws, capital guidelines and liquidity regulatory guidance; environmental and social risk (including climate-related risk);
exposure related to litigation and regulatory matters; increased competition from incumbents and new entrants (including Fintechs and big technology competitors); shifts in consumer attitudes and disruptive technology;
ability of the Bank to attract, develop, and retain key talent; changes in foreign exchange rates, interest rates, credit spreads. equity prices and commodity prices; downgrade, suspension or withdrawal of ratings assigned by
any rating agency; the value and market price of the Bank’s common shares and other securities may be impacted by market conditions and other factors; the interconnectivity of financial institutions including existing and
potential international debt crises; increased funding costs and market volatility due to market illiquidity and competition for funding; critical accounting estimates and changes to accounting standards, policies, and methods
used by the Bank; and the occurrence of natural and unnatural catastrophic events and claims resulting from such events. The Bank cautions that the preceding list is not exhaustive of all possible risk factors and other
factors could also adversely affect the Bank’s results. For more detailed information, please refer to the “Risk Factors and Management” section of the 2025 MD&A, and the sections related to strategic, credit, market
(including equity, commodity, foreign exchange, interest rate, and credit spreads), operational (including technology, cyber security, process, systems, data, third-party, fraud, infrastructure, insider and conduct), model,
insurance, liquidity, capital adequacy, compliance, financial crime, reputational, environmental and social risk in the “Managing Risk” section of the 2025 MD&A, as may be updated in subsequently filed quarterly reports to
shareholders and news releases (as applicable) related to any events or transactions discussed under the headings “Significant Events” or “Update on U.S. Bank Secrecy Act (BSA)/Anti-Money Laundering (AML) Program
Remediation and Enterprise AML Program Improvement Activities“ in the relevant MD&A, which applicable releases may be found on www.td.com. All such factors, as well as other uncertainties and potential events, and
the inherent uncertainty of forward-looking statements, should be considered carefully when making decisions with respect to the Bank. The Bank cautions readers not to place undue reliance on the Bank’s forward-looking
statements.
Material economic assumptions underlying the forward-looking statements contained in this document are set out in the 2025 MD&A under the headings “Economic Summary and Outlook” and “Significant Events”,
under the headings “Key Priorities for 2026” and “Operating Environment and Outlook” for the Canadian Personal and Commercial Banking, U.S. Banking, Wealth Management and Insurance, and Wholesale Banking
segments, each as may be updated in subsequently filed quarterly reports to shareholders and news releases (as applicable).
Any forward-looking statements contained in this document represent the views of management only as of the date hereof and are presented for the purpose of assisting the Bank’s shareholders and analysts in
understanding the Bank’s financial position, objectives and priorities and anticipated financial performance as at and for the periods ended on the dates presented, and may not be appropriate for other purposes. The Bank
does not undertake to update any forward-looking statements, whether written or oral, that may be made from time to time by or on its behalf, except as required under applicable securities legislation.
This document was reviewed by the Bank’s Audit Committee and was approved by the Bank’s Board of Directors, on the Audit Committee’s recommendation, prior to its release.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 5
TABLE 1: FINANCIAL HIGHLIGHTS
(millions of Canadian dollars, except as noted)
For the three months ended
For the nine months ended
July 31
April 30
July 31
July 31
July 31
2026
2026
2025
2026
2025
Results of operations
Total revenue – reported
$
16,885
$
15,797
$
15,297
$
49,267
$
52,283
Total revenue – adjusted
1
16,926
16,037
15,614
49,592
45,782
Provision for (recovery of) credit losses
917
1,001
971
2,957
3,524
Insurance service expenses (ISE)
1,646
1,398
1,563
4,666
4,487
Non-interest expenses – reported
8,475
8,372
8,522
25,600
24,731
Non-interest expenses – adjusted
1
8,441
8,339
8,124
25,343
24,015
Net income – reported
4,615
4,251
3,336
12,909
17,258
Net income – adjusted
1
4,671
4,168
3,871
13,055
11,120
Financial position
(billions of Canadian dollars)
Total loans net of allowance for loan losses
$
991.0
$
964.3
$
936.1
$
991.0
$
936.1
Total assets
2,111.9
2,085.1
2,035.2
2,111.9
2,035.2
Total deposits
1,260.7
1,243.4
1,256.9
1,260.7
1,256.9
Total equity
127.0
124.3
125.4
127.0
125.4
Total risk-weighted assets
2
653.4
641.4
627.2
653.4
627.2
Financial ratios
Return on common equity (ROE) – reported
3
15.8
%
14.7
%
11.3
%
14.6
%
20.2
%
Return on common equity – adjusted
1
16.0
14.4
13.2
14.8
12.9
Return on tangible common equity (ROTCE)
1,3
19.0
17.7
13.6
17.6
25.2
Return on tangible common equity – adjusted
1
19.1
17.2
15.8
17.7
15.9
Efficiency ratio – reported
3
50.2
53.0
55.7
52.0
47.3
Efficiency ratio – adjusted, net of ISE
1,3,4
55.2
57.0
57.8
56.4
58.2
Provision for (recovery of) credit losses as a % of net
average loans
0.37
0.43
0.41
0.41
0.50
Common share information – reported
(Canadian dollars)
Per share earnings
Basic
$
2.75
$
2.44
$
1.89
$
7.53
$
9.73
Diluted
2.74
2.43
1.89
7.50
9.72
Dividends per share
1.12
1.08
1.05
3.28
3.15
Book value per share
3
69.69
68.22
67.13
69.69
67.13
Closing share price (TSX)
5
168.04
146.33
100.92
168.04
100.92
Shares outstanding (millions)
Average basic
1,646.0
1,660.7
1,716.7
1,662.3
1,735.7
Average diluted
1,652.2
1,665.5
1,718.9
1,667.6
1,737.0
End of period
1,638.4
1,652.1
1,707.2
1,638.4
1,707.2
Market capitalization (billions of Canadian dollars)
$
275.3
$
241.7
$
172.3
$
275.3
$
172.3
Dividend yield
3
2.8
%
3.2
%
4.4
%
3.1
%
4.9
%
Dividend payout ratio
3
40.7
44.1
55.4
43.4
32.3
Price-earnings ratio
3
18.0
17.3
8.6
18.0
8.6
Total shareholder return (1 year)
3
71.9
72.2
30.0
71.9
30.0
Common share information – adjusted
(Canadian dollars)
1
Per share earnings
Basic
$
2.78
$
2.39
$
2.20
$
7.61
$
6.19
Diluted
2.77
2.38
2.20
7.59
6.19
Dividend payout ratio
40.2
%
45.0
%
47.5
%
42.9
%
50.7
%
Price-earnings ratio
17.2
15.9
12.8
17.2
12.8
Capital ratios
2
Common Equity Tier 1 (CET1) Capital ratio
14.3
%
14.3
%
14.8
%
14.3
%
14.8
%
Tier 1 Capital ratio
16.1
16.0
16.5
16.1
16.5
Total Capital ratio
17.9
17.8
18.4
17.9
18.4
Leverage ratio
4.5
4.5
4.6
4.5
4.6
Total Loss Absorbing Capacity (TLAC) ratio
31.1
31.1
30.9
31.1
30.9
TLAC Leverage ratio
8.8
8.8
8.7
8.8
8.7
1
accordance with IFRS as the “reported” results. The Bank also utilizes non-GAAP financial measures such as “adjusted” results and non-GAAP ratios to assess each of its businesses
and to measure overall Bank performance. To arrive at adjusted results, the Bank adjusts reported results for “items of note”. Refer to “How We Performed” or “How Our Businesses
Performed” sections of this document for further explanation, a list of the items of note, and a reconciliation of adjusted to reported results. Non-GAAP financial measures and ratios used
in this document are not defined terms under IFRS and, therefore, may not be comparable to similar terms used by other issuers.
2
(CAR), Leverage Requirements (LR), and Total Loss Absorbing Capacity (TLAC) guidelines. Refer to the “Capital Position” section of this document for further details.
3
4
Q3 2026: $15,280 million, Q2 2026: $14,639 million, Q3 2025: $14,051 million, 2026 YTD: $44,926 million, 2025 YTD: $41,295 million.
5
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 6
UPDATE ON THE REMEDIATION OF THE U.S. BANK SECRECY ACT/ANTI-MONEY LAUNDERING PROGRAM AND
ENTERPRISE AML PROGRAM
As previously disclosed, on October 10, 2024, the Bank announced that, following active cooperation and engagement with authorities and regulators, it reached a
resolution (the “Global Resolution”) of previously disclosed investigations related to its U.S. BSA/AML program. The Bank and certain of its U.S. subsidiaries
consented to orders with the Office of the Comptroller of the Currency (“OCC”), the Federal Reserve Board (“FRB”), and the Financial Crimes Enforcement
Network (“FinCEN”) and entered into plea agreements with the Department of Justice (“DOJ”), Criminal Division, Money Laundering and Asset Recovery Section
and the United States Attorney’s Office for the District of New Jersey. The full terms of the consent orders and plea agreements are available on the Bank’s issuer
profile on SEDAR+ at www.sedarplus.com.
The Bank is focused on meeting the terms of the consent orders and plea agreements, including meeting the requirements to remediate the Bank’s U.S. BSA/AML
program. In addition, the Bank is also undertaking remediation of the Bank’s enterprise-wide AML/Anti-Terrorist Financing and Sanctions Programs (“Enterprise
AML Program”).
For additional information on the risks associated with the remediation of the Bank’s U.S. BSA/AML program and the Bank’s Enterprise AML Program, see the
“Risk Factors That May Affect Future Results – Remediation of the Bank’s U.S. BSA/AML Program and Enterprise AML Program” section of the 2025 MD&A.
Update on the Remediation of the U.S. AML Program
The Bank remains focused on remediating its U.S. BSA/AML program to meet the requirements of the Global Resolution. The Bank continues to work on its
management remediation actions (the term “management remediation actions” is not a regulatory definition and is considered by the Bank to consist of the root
cause assessments, data preparation, design, documentation, frameworks, policies, standards, training, processes, systems, testing and implementation of
controls, as well as the hiring of resources) with significant work and important milestones remaining in calendar 2026 and calendar 2027 including the Suspicious
Activity Report lookback per the OCC consent order which management expects to complete in calendar 2027. For fiscal 2026, the Bank expects U.S. BSA/AML
remediation and related governance and control investments to be approximately US$550 million pre-tax, higher than the previous guidance of US$500 million
due to increased costs associated with lookback activities. All management remediation actions will be subject to demonstrated sustainability and validation by the
Bank’s internal audit function (with such activities currently planned for calendar 2026 and calendar 2027), as well as the review by the appointed monitor, and,
ultimately, the review and approval of the Bank’s U.S. banking regulators and the DOJ. Following such independent reviews, testing, and validation, there could be
additional management remediation actions that would take place after calendar 2027 in which case the overall remediation timeline may be extended. In addition,
as the Bank undertakes the lookback reviews, the Bank may be required to further expand the scope of the review, either in terms of the subjects being addressed
and/or the time period reviewed. The following graph illustrates the Bank’s expected remediation plan and progress on a calendar year basis, based on its work to
date:
The Bank’s remediation timeline is based on the Bank’s current plans, as well as assumptions related to the duration of remediation activities, including the
completion of lookback reviews. The Bank’s ability to meet its planned remediation milestones assumes that the Bank will be able to successfully execute against
its U.S. BSA/AML remediation program plan, which is subject to inherent risks and uncertainties including the Bank’s ability to attract and retain key employees,
the ability of third parties to deliver on their contractual obligations, the successful development and implementation of required technology solutions, and data
availability to complete the required lookback reviews. Furthermore, the execution of the U.S. BSA/AML remediation plan, including these planned milestones, will
not be entirely within the Bank’s control because of various factors such as (i) the requirement to obtain regulatory approval or non-objection before proceeding
with various steps, and (ii) the requirement for the various deliverables to be acceptable to the regulators and/or the monitor. As of the date hereof, the Bank
believes that it and its applicable U.S. subsidiaries have taken such actions as are required of them to date under the terms of the consent orders and plea
agreements and is not aware of them being in breach of the same. For information about the Bank’s AML governance framework, see the “Managing Risk” section
of the Bank’s 2025 Annual Report.
While substantial work remains, the Bank is making progress on remediating and strengthening its U.S. BSA/AML program as previously disclosed including
continued improvements through:
1)
assessments which together provide greater visibility into emerging and evolving risks, help ensure monitoring is aligned to those risks, and allow the
Bank to more dynamically respond to those risks;
2)
financial crime threats;
3)
expertise of front-line teams operating in areas with elevated AML risk and reinforce the consistent application of our policies, standards and controls;
and
4)
Going forward, the Bank’s focus will be on continuing to remediate and strengthen its U.S. BSA/AML program, including:
1)
2)
3)
6
U.S. BSA/AML remediation plan, which could change as a result of additional findings that are identified as work progresses, (ii) actual third party monitor and lookback review costs,
which could vary from initial estimates and are not entirely within the control of the Bank, as well as (iii) the Bank’s ability to successfully execute against the U.S. BSA/AML remediation
program in accordance with the U.S. Banking segment’s fiscal 2026 and medium-term plan
.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 7
4)
single source of truth in support of advanced detection capabilities;
5)
6)
7)
Strengthening of the Bank’s Enterprise AML Program
The Bank continues to undertake remediation of the Enterprise AML Program, including a range of management remediation and enhancement actions (the term
“management remediation and enhancement actions” is not a regulatory definition and is considered by the Bank to consist of root cause assessments, data
preparation, design, documentation, frameworks, policies, standards, training, processes, systems, testing, and execution of controls, as well as the hiring of
resources). While the Bank has made progress on this remediation work, it is a multi-year endeavour and the remediation work remains ongoing. The timing of
completion of the remediation work will not be entirely within the Bank’s control, and is subject to regulatory feedback, internal review, challenge and validation. As
previously disclosed, following the end of the first quarter of fiscal 2025, the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC)
commenced a review of certain remediation steps that the Bank has taken to date to address the FINTRAC violations. This review is ongoing, and subject to the
outcome, may result in additional regulatory actions.
The remediation and enhancement of the Enterprise AML Program is exposed to similar risks as noted in respect of the remediation of the Bank’s U.S. BSA/AML
Program (see also “Remediation of the U.S. BSA/AML Program” above). In particular, as the Bank continues its remediation and improvement activities of the
Enterprise AML Program, it expects an increase in identification of reportable transactions and/or events, which will add to the operational inventories in the Bank’s
FCRM investigations processing that the Bank currently faces, but is working towards remediating, across the Bank. In addition, on an ongoing basis, the Bank will
continue to review and assess whether issues identified in one jurisdiction have an impact in other jurisdictions. Furthermore, the Bank’s regulators or law
enforcement agencies may identify other issues with the Bank’s Enterprise AML Program, which may result in additional regulatory actions. These issues identified
through the Bank’s own review or by the Bank’s regulators or law enforcement agencies may broaden the scope of the remediation and improvements required for
the Enterprise AML Program.
While substantial work remains, the Bank is making progress on remediating and strengthening the Enterprise AML Program as previously disclosed, including:
1) advanced investigative effectiveness through enhanced automation and analytics;
2) continued modernization of financial crime monitoring and screening capabilities; and
3) strengthened financial crime risk management technology and workflow capabilities.
Going forward, the Bank’s focus will be on continuing to remediate and strengthen its Enterprise AML Program, including:
1)
2)
3)
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 8
HOW WE PERFORMED
CORPORATE OVERVIEW
The Toronto-Dominion Bank and its subsidiaries are collectively known as TD Bank Group (“TD” or the “Bank”). TD is the sixth largest bank in North America by
assets and serves 28.2 million clients in four key businesses operating in a number of locations in financial centres around the globe: Canadian Personal and
Commercial Banking, including TD Canada Trust and TD Auto Finance Canada; U.S. Banking, including TD Auto Finance U.S. and TD Wealth (U.S.); Wealth
Management and Insurance, including TD Wealth (Canada), TD Direct Investing and TD Insurance; and Wholesale Banking, including TD Securities and TD
Cowen. TD also ranks among North America’s leading digital banks, with more than 14 million active mobile users in Canada and the U.S. TD had $2.1 trillion in
assets on July 31, 2026. The Toronto-Dominion Bank trades under the symbol “TD” on the Toronto Stock Exchange and New York Stock Exchange.
HOW THE BANK REPORTS
The Bank prepares its Interim Consolidated Financial Statements in accordance with IFRS, the current GAAP, and refers to results prepared in accordance with
IFRS as “reported” results.
Non-GAAP and Other Financial Measures
In addition to reported results, the Bank also presents certain financial measures, including non-GAAP financial measures that are historical, non-GAAP ratios,
supplementary financial measures and capital management measures, to assess its results. Non-GAAP financial measures, such as “adjusted” results, are utilized
to assess the Bank’s businesses and to measure the Bank’s overall performance.
To
arrive at adjusted results, the Bank adjusts for “items of note” from reported
results. Items of note are items which management does not believe are indicative of underlying business performance and are disclosed in Table 3. Non-GAAP
ratios include a non-GAAP financial measure as one or more of its components. Examples of non-GAAP ratios include adjusted net interest margin, adjusted basic
and diluted earnings per share (EPS), adjusted dividend payout ratio, adjusted efficiency ratio, net of ISE, and adjusted effective income tax rate. The Bank
believes that non-GAAP financial measures and non-GAAP ratios provide the reader with a better understanding of how management views the Bank’s
performance. Non-GAAP financial measures and non-GAAP ratios used in this document are not defined terms under IFRS and, therefore, may not be
comparable to similar terms used by other issuers. Supplementary financial measures depict the Bank’s financial performance and position, and capital
management measures depict the Bank’s capital position, and both are explained in this document where they first appear.
Investment in The Charles Schwab Corporation (“Schwab”) and Insured Deposit Account (IDA) Agreement
On February 12, 2025, the Bank sold its entire remaining equity investment in Schwab through a registered offering and share repurchase by Schwab. The Bank
discontinued recording its share of earnings available to common shareholders from its investment in Schwab following the sale.
Prior to the sale, the Bank accounted for its investment in Schwab using the equity method. The U.S. Banking segment reflected the Bank’s share of net income
from its investment in Schwab. The Corporate segment net income (loss) included amounts for amortization of acquired intangibles, the acquisition and integration
charges related to the Schwab transaction, and the Bank’s share of restructuring and other charges incurred by Schwab. The Bank’s share of Schwab’s earnings
available to common shareholders was reported with a one-month lag. For further details, refer to Note 12 of the Bank’s 2025 Annual Consolidated Financial
Statements.
Subsequent to the sale of the Bank’s entire remaining equity investment in Schwab, the Bank continues to have a business relationship with Schwab through the
insured deposit account agreement (“Schwab IDA Agreement”).
On May 4, 2023, the Bank and Schwab entered into an amended Schwab IDA Agreement, with an initial expiration of July 1, 2034. Pursuant to the Schwab IDA
Agreement, the Bank makes sweep deposit accounts available to clients of Schwab. Schwab designates a portion of the deposits with the Bank as fixed-rate
obligation amounts. Remaining deposits are designated as floating-rate obligations. The IDA deposit floor is set at US$60 billion.
Refer to Note 26 of the Bank’s 2025 Annual Consolidated Financial Statements for further details on the Schwab IDA Agreement.
The following table provides the operating results on a reported basis for the Bank.
TABLE 2: OPERATING RESULTS – Reported
(millions of Canadian dollars)
For the three months ended
For the nine months ended
July 31
April 30
July 31
July 31
July 31
2026
2026
2025
2026
2025
Net interest income
$
9,296
$
8,861
$
8,526
$
26,946
$
24,517
Non-interest income
7,589
6,936
6,771
22,321
27,766
Total revenue
16,885
15,797
15,297
49,267
52,283
Provision for (recovery of) credit losses
917
1,001
971
2,957
3,524
Insurance service expenses
1,646
1,398
1,563
4,666
4,487
Non-interest expenses
8,475
8,372
8,522
25,600
24,731
Income before income taxes and share of net income from
investment in Schwab
5,847
5,026
4,241
16,044
19,541
Provision for (recovery of) income taxes
1,232
775
905
3,135
2,588
Share of net income from investment in Schwab
–
–
–
–
305
Net income – reported
4,615
4,251
3,336
12,909
17,258
Preferred dividends and distributions on other equity instruments
94
202
88
397
374
Net income available to common shareholders
$
4,521
$
4,049
$
3,248
$
12,512
$
16,884
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 9
The following table provides a reconciliation between the Bank’s adjusted and reported results. For further details refer to the “How We Performed” or “How Our
Businesses Performed” sections of this document.
TABLE 3: NON-GAAP FINANCIAL MEASURES – Reconciliation of Adjusted to Reported Net Income
(millions of Canadian dollars)
For the three months ended
For the nine months ended
July 31
April 30
July 31
July 31
July 31
2026
2026
2025
2026
2025
Operating results – adjusted
Net interest income
1,2
$
9,337
$
8,904
$
8,581
$
27,074
$
24,709
Non-interest income
3
7,589
7,133
7,033
22,518
21,073
Total revenue
16,926
16,037
15,614
49,592
45,782
Provision for (recovery of) credit losses
917
1,001
971
2,957
3,524
Insurance service expenses
1,646
1,398
1,563
4,666
4,487
Non-interest expenses
4
8,441
8,339
8,124
25,343
24,015
Income before income taxes and share of net income from
investment in Schwab
5,922
5,299
4,956
16,626
13,756
Provision for (recovery of) income taxes
5
1,251
1,131
1,085
3,571
2,976
Share of net income from investment in Schwab
6
–
–
–
–
340
Net income – adjusted
4,671
4,168
3,871
13,055
11,120
Preferred dividends and distributions on other equity instruments
94
202
88
397
374
Net income available to common shareholders – adjusted
4,577
3,966
3,783
12,658
10,746
Pre-tax adjustments for items of note
Amortization of acquired intangibles
7
(34)
(33)
(33)
(101)
(137)
Restructuring charges
4
–
–
(333)
(200)
(496)
Acquisition and integration-related charges
4
–
–
(32)
–
(118)
Impact from the terminated FHN acquisition-related capital hedging strategy
1
(41)
(43)
(55)
(128)
(156)
Gain on sale of Schwab shares
3
–
–
–
–
8,975
Balance sheet restructuring
2,3
–
–
(262)
–
(2,318)
Federal Deposit Insurance Corporation (FDIC) special assessment
4
–
–
–
44
–
Change in partnership share in the U.S. strategic cards portfolio
3
–
(197)
–
(197)
–
Less: Impact of income taxes
Amortization of acquired intangibles
(9)
(8)
(8)
(25)
(25)
Restructuring charges
–
–
(85)
(52)
(126)
Acquisition and integration-related charges
–
–
(7)
–
(26)
Impact from the terminated FHN acquisition-related capital hedging strategy
(10)
(10)
(14)
(32)
(39)
Gain on sale of Schwab shares
5
–
(288)
–
(288)
407
Balance sheet restructuring
–
–
(66)
–
(579)
FDIC special assessment
–
–
–
11
–
Change in partnership share in the U.S. strategic cards portfolio
–
(50)
–
(50)
–
Total adjustments for items of note
(56)
83
(535)
(146)
6,138
Net income available to common shareholders – reported
$
4,521
$
4,049
$
3,248
$
12,512
$
16,884
1
2026 YTD: ($128) million, Q3 2025: ($55) million, 2025 YTD: ($156) million, reported in the Corporate segment.
2
i.
3
i.
ii.
iii.
reported in the U.S. Banking segment.
4
i.
ii.
iii.
iv.
5
filing of the Bank’s tax return. Refer to “Income Taxes” in the “Financial Results Overview” section of this document for further details.
6
i.
7
of net income from investment in Schwab, reported in the Corporate segment. Refer to footnotes 4 and 6 for amounts.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 10
TABLE 4: RECONCILIATION OF REPORTED TO ADJUSTED EARNINGS PER SHARE
1
(Canadian dollars)
For the three months ended
For the nine months ended
July 31
April 30
July 31
July 31
July 31
2026
2026
2025
2026
2025
Basic earnings per share – reported
$
2.75
$
2.44
$
1.89
$
7.53
$
9.73
Adjustments for items of note
0.03
(0.05)
0.31
0.08
(3.54)
Basic earnings per share – adjusted
$
2.78
$
2.39
$
2.20
$
7.61
$
6.19
Diluted earnings per share – reported
$
2.74
$
2.43
$
1.89
$
7.50
$
9.72
Adjustments for items of note
0.03
(0.05)
0.31
0.09
(3.53)
Diluted earnings per share – adjusted
$
2.77
$
2.38
$
2.20
$
7.59
$
6.19
1
rounding.
TABLE 5: AMORTIZATION OF INTANGIBLES, NET OF INCOME TAXES
(millions of Canadian dollars)
For the three months ended
For the nine months ended
July 31
April 30
July 31
July 31
July 31
2026
2026
2025
2026
2025
Wholesale Banking related intangibles
$
20
$
20
$
20
$
60
$
61
Schwab
1
–
–
–
–
35
Other
5
5
5
16
16
Included as items of note
25
25
25
76
112
Software and asset servicing rights
160
135
136
430
379
Amortization of intangibles, net of income taxes
$
185
$
160
$
161
$
506
$
491
1
Return on Common Equity
The consolidated Bank ROE is calculated as reported net income available to common shareholders as a percentage of average common equity. The
consolidated Bank adjusted ROE is calculated as adjusted net income available to common shareholders as a percentage of average common equity. Adjusted
ROE is a non-GAAP financial ratio and can be utilized in assessing the Bank’s use of equity.
ROE for the business segments is calculated as the segment net income as a percentage of average allocated capital. The Bank’s methodology for allocating
capital to its business segments is largely aligned with the common equity capital requirements under Basel III. Capital allocated to the business segments was
based on 11.5% CET1 Capital.
TABLE 6: RETURN ON COMMON EQUITY
(millions of Canadian dollars, except as noted)
For the three months ended
For the nine months ended
July 31
April 30
July 31
July 31
July 31
2026
2026
2025
2026
2025
Average common equity
$
113,810
$
113,288
$
114,115
$
114,270
$
111,644
Net income available to common shareholders – reported
4,521
4,049
3,248
12,512
16,884
Items of note, net of income taxes
56
(83)
535
146
(6,138)
Net income available to common shareholders – adjusted
$
4,577
$
3,966
$
3,783
$
12,658
$
10,746
Return on common equity – reported
15.8
%
14.7
%
11.3
%
14.6
%
20.2
%
Return on common equity – adjusted
16.0
14.4
13.2
14.8
12.9
Return on Tangible Common Equity
Tangible common equity (TCE) is calculated as common shareholders’ equity less goodwill, imputed goodwill and intangibles on the investments in Schwab and
other acquired intangible assets, net of related deferred tax liabilities. ROTCE is calculated as reported net income available to common shareholders after
adjusting for the after-tax amortization of acquired intangibles, which are treated as an item of note, as a percentage of average TCE. Adjusted ROTCE is
calculated using reported net income available to common shareholders, adjusted for all items of note, as a percentage of average TCE. TCE, ROTCE, and
adjusted ROTCE can be utilized in assessing the Bank’s use of equity. TCE is a non-GAAP financial measure, and ROTCE and adjusted ROTCE are non-GAAP
ratios.
TABLE 7: RETURN ON TANGIBLE COMMON EQUITY
(millions of Canadian dollars, except as noted)
For the three months ended
For the nine months ended
July 31
April 30
July 31
July 31
July 31
2026
2026
2025
2026
2025
Average common equity
$
113,810
$
113,288
$
114,115
$
114,270
$
111,644
Average goodwill
18,842
18,584
18,652
18,777
19,035
Average imputed goodwill and intangibles on
investments in Schwab
–
–
–
–
2,047
Average other acquired intangibles
1
272
303
405
306
445
Average related deferred tax liabilities
(239)
(240)
(225)
(242)
(232)
Average tangible common equity
94,935
94,641
95,283
95,429
90,349
Net income attributable to common
shareholders – reported
4,521
4,049
3,248
12,512
16,884
Amortization of acquired intangibles, net of income taxes
25
25
25
76
112
Net income attributable to common shareholders
adjusted for amortization of acquired intangibles,
net of income taxes
4,546
4,074
3,273
12,588
16,996
Other items of note, net of income taxes
31
(108)
510
70
(6,250)
Net income available to common shareholders – adjusted
$
4,577
$
3,966
$
3,783
$
12,658
$
10,746
Return on tangible common equity
19.0
%
17.7
%
13.6
%
17.6
%
25.2
%
Return on tangible common equity – adjusted
19.1
17.2
15.8
17.7
15.9
1
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 11
IMPACT OF FOREIGN EXCHANGE RATE ON U.S. BANKING SEGMENT TRANSLATED EARNINGS
The following table reflects the estimated impact of foreign currency translation on key U.S. Banking segment income statement items. The impact is calculated as
the difference in translated earnings using the average U.S. to Canadian dollars exchange rates in the periods noted.
TABLE 8: IMPACT OF FOREIGN EXCHANGE RATE ON U.S. BANKING TRANSLATED
EARNINGS
(millions of Canadian dollars, except as noted)
For the three months ended
For the nine months ended
July 31, 2026 vs.
July 31, 2026 vs.
July 31, 2025
July 31, 2025
Increase (Decrease)
Increase (Decrease)
U.S. Banking
Total revenue – reported
$
64
$
(172)
Total revenue – adjusted
1
64
(179)
Non-interest expenses – reported
39
(110)
Non-interest expenses – adjusted
1
39
(111)
U.S. Banking net income excluding Schwab – reported, after tax
17
(38)
U.S. Banking net income excluding Schwab – adjusted, after tax
1
17
(43)
U.S. Banking net income – reported, after tax
17
(38)
U.S. Banking net income – adjusted, after tax
1
17
(43)
Earnings (loss) per share
(Canadian dollars)
Basic – reported
$
0.01
$
(0.02)
Basic – adjusted
1
0.01
(0.03)
Diluted – reported
0.01
(0.02)
Diluted – adjusted
1
0.01
(0.03)
Average foreign exchange rate (equivalent of CAD $1.00)
For the three months ended
For the nine months ended
July 31
July 31
July 31
July 31
2026
2025
2026
2025
U.S. dollar
$
0.717
$
0.728
$
0.722
$
0.712
1
document.
FINANCIAL RESULTS OVERVIEW
Performance Summary
Outlined below is an overview of the Bank’s performance for the third quarter of 2026. Shareholder performance indicators help guide and benchmark the Bank’s
accomplishments. For the purposes of this analysis, the Bank utilizes adjusted earnings, which excludes items of note from the reported results that are prepared
in accordance with IFRS. Reported and adjusted results and items of note are explained in “Non-GAAP and Other Financial Measures” in the “How We Performed”
section of this document.
●
months ended July 31, 2026, increased 23% from the same period last year.
●
●
average of 69.8%.
Net Income
Quarterly comparison – Q3 2026 vs. Q3 2025
Reported net income for the quarter was $4,615 million, an increase of $1,279 million, or 38%, compared with the third quarter last year, primarily reflecting higher
revenues, lower PCL, lower non-interest expenses, partially offset by higher insurance service expenses. On an adjusted basis, net income for the quarter was
$4,671 million, an increase of $800 million, or 21%, compared with the third quarter last year.
By segment, the increase in reported net income reflects increases in Wholesale Banking of $345 million, in the Corporate segment of $340 million, in U.S.
Banking of $314 million, in Canadian Personal and Commercial Banking of $142 million, and in Wealth Management and Insurance of $138 million.
Quarterly comparison – Q3 2026 vs. Q2 2026
Reported net income for the quarter increased $364 million, or 9%, compared with the prior quarter, primarily reflecting higher revenues and lower PCL, partially
offset by the second quarter impact of a tax benefit related to the prior year's gain on sale of Schwab shares, higher insurance service expenses and higher non-
interest expenses. Adjusted net income for the quarter increased by $503 million, or 12%, compared with the prior quarter.
By segment, the increase in reported net income reflects increases in U.S. Banking of $261 million, in Canadian Personal and Commercial Banking of
$170 million, in Wholesale Banking of $131 million, in Wealth Management and Insurance of $4 million, partially offset by a decrease in the Corporate segment of
$202 million.
Year-to-date comparison – Q3 2026 vs. Q3 2025
Reported net income of $12,909 million, decreased $4,349 million, or 25% compared with the same period last year. The decrease primarily reflects the gain on
the Schwab sale transaction in the prior year, higher non-interest expenses and higher insurance service expenses, partially offset by higher net interest income
and lower PCL. Adjusted net income was $13,055 million, an increase of $1,935 million, or 17%.
By segment, the decrease in reported net income reflects a decrease in the Corporate segment of $7,811 million, partially offset by increases in U.S. Banking of
$1,705 million, in Wholesale Banking of $800 million, in Canadian Personal and Commercial Banking of $612 million and in Wealth Management and Insurance of
$345 million.
Net Interest Income
Quarterly comparison – Q3 2026 vs. Q3 2025
Reported net interest income for the quarter was $9,296 million, an increase of $770 million, or 9%, compared with the third quarter last year, primarily reflecting
higher margins and volume growth in Canadian Personal and Commercial Banking, higher net interest income in Wholesale Banking, higher loan margins
7
Canadian peers include Bank of Montreal, Canadian Imperial Bank of Commerce, Royal Bank of Canada, and The Bank of Nova Scotia.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 12
including higher revenue due to the strategic card platform conversion, higher deposit margins in U.S. Banking, and higher deposit volumes in Wealth
Management and Insurance. On an adjusted basis, net interest income was $9,337 million, an increase of $756 million, or 9%.
By segment, the increase in reported net interest income reflects increases in Canadian Personal and Commercial Banking of $289 million, in U.S. Banking of
$251 million, in Wholesale Banking of $160 million, in Wealth Management and Insurance of $93 million, partially offset by a decrease in the Corporate segment of
$23 million.
Quarterly comparison – Q3 2026 vs. Q2 2026
Reported net interest income for the quarter increased $435 million, or 5%, compared with the prior quarter, primarily reflecting the impact of additional days in the
current quarter, and the impact of foreign exchange translation. On an adjusted basis, net interest income increased $433 million, or 5%.
By segment, the increase in reported net interest income reflects increases in Canadian Personal and Commercial Banking of $239, in U.S. Banking of
$156 million, in Wealth Management and Insurance of $43 million and in the Corporate segment of $3 million, partially offset by a decrease in Wholesale Banking
of $6 million.
Year-to-date comparison – Q3 2026 vs. Q3 2025
Reported net interest income was $26,946 million, an increase of $2,429 million, or 10%, compared with the same period last year, primarily reflecting volume
growth and higher loan margins in Canadian Personal and Commercial Banking, higher net interest income in Wholesale Banking and higher loan margins
including higher revenue due to the strategic card platform conversion and higher deposit margins in U.S. Banking. On an adjusted basis, net interest income was
$27,074 million, an increase of $2,365 million, or 10%.
By segment, the increase in reported net interest income reflects increases in Canadian Personal and Commercial Banking of $814 million, in U.S. Banking of
$641 million, in Wholesale Banking of $423 million, in the Corporate segment of $360 million, and in Wealth Management and Insurance of $191 million.
Non-Interest Income
Quarterly comparison – Q3 2026 vs. Q3 2025
Reported non-interest income for the quarter was $7,589 million, an increase of $818 million, or 12%, compared with the third quarter last year, primarily reflecting
higher non-interest income in Wholesale Banking, higher non-interest income in U.S. Banking reflecting the impact of U.S. balance sheet restructuring activities in
prior year, and higher fee-based revenue from asset growth and higher insurance earned premiums in Wealth Management and Insurance. On an adjusted basis,
non-interest income was $7,589 million, an increase of $556 million, or 8%.
By segment, the increase in reported non-interest income reflects an increase in Wholesale Banking of $358 million, in Wealth Management and Insurance of
$319 million and in U.S. Banking of $273 million, partially offset by decreases in the Corporate segment of $119 million and Canadian Personal and Commercial
Banking of $13 million.
Quarterly comparison – Q3 2026 vs. Q2 2026
Reported non-interest income for the quarter increased by $653 million, or 9%, compared with the prior quarter, primarily reflecting the impact of more days in the
third quarter, fee-based revenue growth and transaction revenue in Wealth Management and Insurance, receivable adjustment in the U.S. strategic cards portfolio
in the prior quarter in U.S. Banking and higher non-interest income in Wholesale Banking. On an adjusted basis, non-interest income increased $456 million, or
6%.
By segment, the increase in reported non-interest income reflects increases in Wealth Management and Insurance of $264 million, in U.S. Banking of
$226 million, Wholesale Banking of $194 million and in Canadian Personal and Commercial Banking of $22 million, partially offset by a decrease in the Corporate
segment of $53 million.
Year-to-date comparison – Q3 2026 vs. Q3 2025
Reported non-interest income was $22,321 million, a decrease of $5,445 million, or 20%, compared with the same period last year, primarily reflecting the gain on
the Schwab sale transaction in the prior year in the Corporate segment, partially offset by higher non-interest income in U.S. Banking reflecting the impact of U.S.
balance sheet restructuring activities in the prior year, higher non-interest income in Wholesale Banking and higher fee-based revenue from asset growth and
insurance earned premiums in Wealth Management and Insurance. Adjusted non-interest income was $22,518 million, an increase of $1,445 million, or 7%.
By segment, the decrease in reported non-interest income reflects decreases in the Corporate segment of $9,129 million and Canadian Personal and
Commercial Banking of $1 million, partially offset by increases in U.S. Banking of $2,052 million, in Wholesale Banking of $829 million and in Wealth Management
and Insurance of $804 million.
Provision for Credit Losses
Quarterly comparison – Q3 2026 vs. Q3 2025
PCL for the quarter was $917 million, a decrease of $54 million compared with the third quarter last year. PCL – impaired was $865 million, a decrease of
$39 million, or 4%, reflecting lower provisions across the business and government lending portfolios, partially offset by credit migration in the Canadian and U.S.
consumer lending portfolios. PCL – performing was $52 million, a decrease of $15 million compared with the third quarter last year. The current quarter performing
provisions reflect credit migration and volume growth. Total PCL for the quarter as an annualized percentage of credit volume was 0.37%.
By segment, PCL was lower by $39 million in Corporate segment, by $30 million in Wholesale Banking, and higher by $15 million in Canadian Personal and
Commercial Banking.
Quarterly comparison – Q3 2026 vs. Q2 2026
PCL for the quarter was $917 million, a decrease of $84 million compared with the prior quarter. PCL – impaired was $865 million, a decrease of $108 million, or
11%, largely driven by lower provisions across the business and government lending portfolios. PCL – performing was $52 million, an increase of $24 million
compared with the prior quarter. The current quarter performing provisions reflect credit migration and volume growth.
By segment, PCL was lower by $37 million in Wholesale Banking, by $25 million in U.S Banking, by $20 million in Canadian Personal and Commercial Banking,
and by $2 million in Corporate segment.
Looking forward, while results may vary by quarter, and are subject to changes to economic conditions, total PCLs in fiscal 2026 are now expected to be near
the lower end of the previously guided range of 40 to 50 basis points
Year-to-date comparison – Q3 2026 vs. Q3 2025
8
The Bank’s estimated PCL range is based on forward-looking assumptions that have inherent risks and uncertainties. Results may vary depending on actual economic or credit conditions and
performance, such as the level of unemployment, interest rates, economic growth or contraction, and borrower or industry specific credit factors and conditions, inclusive of policy and trade uncertainty.
The Bank’s PCL estimate is subject to risks and uncertainties including those set out in the “Risk Factors That May Affect Future Results” section of this document.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 13
PCL was $2,957 million, a decrease of $567 million compared with the same period last year. PCL – impaired was $3,002 million, a decrease of $64 million, or
2%, largely driven by lower provisions in the Canadian and U.S. commercial lending portfolios, partially offset by credit migration in Canadian consumer and
Wholesale lending portfolios. PCL – performing was a recovery of $45 million, compared with a build of $458 million in the same period last year. The current year
performing recovery largely reflects migration from performing to impaired, an update to the macroeconomic forecast, and lower volume in U.S. Banking, partially
offset by credit migration. Total PCL as an annualized percentage of credit volume was 0.41%.
By segment, PCL was lower by $256 million in U.S. Banking, by $194 million in Canadian Personal and Commercial Banking, by $142 million in the Corporate
segment, and higher by $25 million in Wholesale Banking.
TABLE 9: PROVISION FOR CREDIT LOSSES
1
(millions of Canadian dollars)
For the three months ended
For the nine months ended
July 31
April 30
July 31
July 31
July 31
2026
2026
2025
2026
2025
Provision for (recovery of) credit losses – Stage 3 (impaired)
Canadian Personal and Commercial Banking
$
446
$
465
$
376
$
1,335
$
1,263
U.S. Banking
326
332
330
1,052
1,168
Wholesale Banking
6
80
63
302
157
Corporate
2
87
96
135
313
478
Total provision for (recovery of) credit losses – Stage 3
865
973
904
3,002
3,066
Provision for (recovery of) credit losses – Stage 1
and Stage 2 (performing)
Canadian Personal and Commercial Banking
32
33
87
77
343
U.S. Banking
(9)
10
(13)
(98)
42
Wholesale Banking
35
(2)
8
(11)
109
Corporate
2
(6)
(13)
(15)
(13)
(36)
Total provision for (recovery of) credit losses – Stage 1
and Stage 2
52
28
67
(45)
458
Total provision for (recovery of) credit losses
$
917
$
1,001
$
971
$
2,957
$
3,524
1
2
Insurance Service Expenses
Quarterly comparison – Q3 2026 vs. Q3 2025
Insurance service expenses for the quarter were $1,646 million, an increase of $83 million or 5%, compared with the third quarter last year, mainly driven by higher
estimated losses from catastrophe claims.
Quarterly comparison – Q3 2026 vs. Q2 2026
Insurance service expenses increased $248 million, or 18%, compared with the prior quarter, mainly driven by higher estimated losses from catastrophe claims
and higher claims frequency.
Year-to-date comparison – Q3 2026 vs. Q3 2025
Insurance service expenses were $4,666 million, an increase of $179 million, or 4%, compared with the same period last year, primarily driven by increased claims
severity, higher estimated losses from catastrophe claims and higher costs due to business growth initiatives.
Non-Interest Expenses and Efficiency Ratio
Quarterly comparison – Q3 2026 vs. Q3 2025
Reported non-interest expenses were $8,475 million, a decrease of $47 million, or 1%, compared with the third quarter last year, primarily reflecting restructuring
charges in the prior year, partially offset by higher spend supporting business growth initiatives including employee-related expenses. On an adjusted basis, non-
interest expenses were $8,441 million, an increase of $317 million, or 4%. The Bank continues to expect fiscal 2026 adjusted expense growth, assuming fiscal
2025 levels of variable compensation, foreign exchange translation, and U.S. strategic cards portfolio impact, to be at the previously communicated 3% to 4%
range, reflecting investments supporting business growth and investments in governance and control, net of expected productivity and restructuring savings
By segment, the decrease in reported non-interest expenses reflects decrease in the Corporate segment of $527 million, partially offset by increases in U.S.
Banking of $173 million, in Wealth Management and Insurance of $141 million, in Wholesale Banking of $101 million, and in Canadian Personal and Commercial
Banking of $65 million.
The Bank’s reported efficiency ratio was 50.2%, compared to 55.7% in the third quarter last year. The Bank’s adjusted efficiency ratio, net of ISE was 55.2%,
compared with 57.8% in the third quarter last year.
Quarterly comparison – Q3 2026 vs. Q2 2026
Reported non-interest expenses increased $103 million, or 1%, compared with the prior quarter, primarily reflecting higher employee-related expenses. Adjusted
non-interest expenses increased $102 million, or 1% compared with the prior quarter.
By segment, the increase in reported non-interest expenses reflects increases in Wholesale Banking of $85 million, in U.S. Banking of $78 million, in Wealth
Management and Insurance of $47 million, in Canadian Personal and Commercial Banking of $43 million, partially offset by a decrease in the Corporate segment
of $150 million.
The Bank’s reported efficiency ratio was 50.2%, compared with 53.0% in the prior quarter. The Bank’s adjusted efficiency ratio, net of ISE was 55.2%,
compared with 57.0% in the prior quarter.
9
The Bank’s expectations regarding expense growth are based on the Bank’s assumptions regarding certain factors, including governance and control investments, timing of business investments,
employee-related expenses, foreign exchange impact, gross-up of the retailer program partners’ share of PCL for the Bank’s U.S. strategic cards portfolio (“SCP Impact”), and productivity and
restructuring savings. In particular in estimating its expense growth expectations, the Bank has assumed that the following three factors on the Bank’s fiscal 2026 adjusted expenses will be the same as
the Bank’s fiscal 2025 adjusted expenses: (i) variable compensation in Wholesale Banking and Wealth Management, (ii) foreign exchange translation, and (iii) SCP Impact. For reference, in the third
quarter of 2026, variable compensation, foreign exchange translation, and the SCP impact, in the aggregate, accounted for approximately 3% of the year-over-year 4% increase in adjusted non-interest
expenses. The Bank’s assumptions are subject to inherent uncertainties and may vary based on factors both within and outside the Bank’s control, including the accuracy of the Bank’s employee
compensation and benefit expense forecasts, impact of business performance on variable compensation, inflation, the pace of productivity initiatives across the organization, and unexpected expenses
such as legal matters. Refer to the “Risk Factors That May Affect Future Results” section of this document for additional information about risks and uncertainties that may impact the Bank’s estimates.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 14
Year-to-date comparison – Q3 2026 vs. Q3 2025
Reported non-interest expenses of $25,600 million increased $869 million, or 4%, compared with the same period last year primarily reflecting higher employee-
related expenses and higher investments in governance and controls, including costs for U.S. BSA/AML remediation. On an adjusted basis, non-interest expenses
were $25,343 million, an increase of $1,328 million, or 6%.
By segment, the increase in reported non-interest expenses reflects increases, in U.S. Banking of $399 million, in Wealth Management and Insurance of
$344 million, in Wholesale Banking of $177 million and in Canadian Personal and Commercial Banking of $162 million, partially offset by a decrease in the
Corporate segment of $213 million
The Bank’s reported efficiency ratio was 52.0%, compared with 47.3% in the same period last year. The Bank’s adjusted efficiency ratio, net of ISE was 56.4%,
compared with 58.2% in the same period last year.
Income Taxes
The Bank’s effective income tax rate on a reported basis was 21.1% for the current quarter, compared with 21.3% in the third quarter last year and 15.4% in the
prior quarter. The year-over-year decrease primarily reflects changes in earnings mix, partially offset by the impact of higher pre-tax income. The quarter-over-
quarter increase primarily reflects the prior quarter adjustment to the Bank's estimate of taxes owed on the gain from its disposition of Schwab shares in the prior
year.
To allow for an after-tax calculation of adjusted income, the adjusted provision for income taxes is calculated by adjusting the taxes for each item of note using
the statutory income tax rate of the applicable legal entity. The adjusted effective income tax rate is calculated as the adjusted provision for income taxes as a
percentage of adjusted net income before taxes. The Bank’s adjusted effective income tax rate was 21.1% for the current quarter, compared with 21.9% in the
third quarter last year and 21.3% in the prior quarter. The year-over-year and quarter-over-quarter decreases primarily reflect changes in earnings mix, partially
offset by the impact of higher adjusted pre-tax income.
TABLE 10: INCOME TAXES – Reconciliation of Reported to Adjusted Provision for Income Taxes
(millions of Canadian dollars, except as noted)
For the three months ended
For the nine months ended
July 31
April 30
July 31
July 31
July 31
2026
2026
2025
2026
2025
Income taxes at Canadian statutory income tax rate
$
1,625
27.8
%
$
1,397
27.8
%
$
1,179
27.8
%
$
4,460
27.8
%
$
5,432
27.8
%
Increase (decrease) resulting from:
Rate differentials on international operations
1
(348)
(6.0)
(591)
(11.8)
(243)
(5.7)
(1,215)
(7.6)
(2,745)
(14.0)
Other
(45)
(0.7)
(31)
(0.6)
(31)
(0.8)
(110)
(0.7)
(99)
(0.6)
Provision for income taxes and effective
income tax rate – reported
$
1,232
21.1
%
$
775
15.4
%
$
905
21.3
%
$
3,135
19.5
%
$
2,588
13.2
%
Total adjustments for items of note
19
356
180
436
388
Provision for income taxes and effective
income tax rate – adjusted
$
1,251
21.1
%
$
1,131
21.3
%
$
1,085
21.9
%
$
3,571
21.5
%
$
2,976
21.6
%
1
Income Tax Adjustment on the Gain on Sale of Schwab Shares
In the second quarter of fiscal 2026, the Bank revised its estimate of taxes owed on the gain from its disposition of Schwab shares in the prior year. The revision
reflected the Bank's most recent tax filings and included previously inestimable information. The revision reduced the Bank's provision for income taxes by
$288 million and was reflected as an item of note in the Corporate segment results in the prior quarter.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 15
ECONOMIC SUMMARY AND OUTLOOK
The global outlook for the remainder of 2026 remains shaped by the ongoing oil price shock, which has renewed inflation concerns and added to growth
headwinds. In China, weak domestic demand and disappointing second-quarter data point to a softer backdrop. Europe appears on track to improve modestly,
supported by healthy labour markets, though elevated energy prices remain a constraint. Broadly, the global economy is adjusting to higher-for-longer interest
rates and persistent inflation, creating difficult trade-offs for policymakers.
The U.S. economy is on track to outpace other G7 economies for a fourth consecutive year. TD Economics forecasts real GDP to expand by 2.2% in calendar
2026. Activity has been supported by continued AI-related capital spending and expansionary fiscal policy. Bolstered by tax cuts, consumer spending has held up
in the face of higher energy prices. The U.S. labour market remains in an environment where both hiring and layoff rates are low, with employment growth running
roughly in line with labour force growth. The unemployment rate has drifted lower over the last few months, reaching a thirteen-month low of 4.1% in July.
U.S. inflation is still above the Federal Reserve's 2% target, reflecting both the pass-through effects from tariffs and higher energy prices. As a result, the risk of
policy rate increases has risen, with more Federal Reserve officials expressing a desire for tighter policy after a prolonged period of elevated inflation. TD
Economics expects inflation pressures to ease as supply shocks fade, enabling the Federal Reserve to keep the policy rate unchanged at 3.5%-3.75% this year.
The timing and pace of interest rate moves will depend on labour market trends and whether inflationary pressures prove more persistent than expected.
Canada’s economy contracted marginally in late 2025 and early 2026, but TD Economics expects it to rebound solidly in the second calendar quarter of 2026.
New U.S. tariffs on Canadian goods that followed the breakdown in trade talks pose a downside risk to growth, but the impact will depend on how long the tariffs
are in place and the extent of retaliation. Canada's labour market has improved more than expected so far this year. A recent pickup in hiring, alongside modest
labour force growth, has pushed the unemployment rate lower, reaching a two-year low of 6.4% in July. Looking ahead, growth is expected to be supported by a
firming in business investment, public infrastructure and defense outlays, and steady consumer spending. Risks to the outlook remain highly sensitive to
geopolitical events and U.S. trade policy.
The Bank of Canada has held the overnight rate at 2.25% so far this year after substantial easing since mid-2024. TD Economics expects the policy rate to stay
unchanged through the remainder of 2026. With the economy in excess supply and growth expected to remain modest, inflation should remain close to the Bank
of Canada's 2% target. A generally weaker U.S. dollar and a narrower gap between U.S. and Canadian short-term interest rates are expected to support the
Canadian dollar as geopolitical tensions ease. TD Economics expects the Canadian dollar to remain in the 72-74 U.S. cent range over the next few quarters,
although the outcome of U.S. trade policy will be a key determinant of timing and direction.
HOW OUR BUSINESSES PERFORMED
For management reporting purposes, the Bank’s business operations and activities are organized around the following four key business segments: Canadian
Personal and Commercial Banking, U.S. Banking, Wealth Management and Insurance, and Wholesale Banking. The Bank’s other activities are grouped into the
Corporate segment. Effective June 1, 2026, the Bank implemented a reorganization within the Canadian Personal and Commercial Banking segment, whereby
Small Business Banking transitioned from Canadian Business Banking to Canadian Personal Banking. The reorganization does not impact the segment’s
reporting.
Results of each business segment reflect revenue, expenses, assets, and liabilities generated by the businesses in that segment. Where applicable, the Bank
measures and evaluates the performance of each segment based on adjusted results and ROE, and for those segments, the Bank indicates that the measure is
adjusted. For further details, refer to the “How We Performed” section of this document, the “Business Focus” section in the Bank’s 2025 MD&A, and Note 27 of
the Bank’s Annual Consolidated Financial Statements for the year ended October 31, 2025.
PCL related to performing (Stage 1 and Stage 2) and impaired (Stage 3) financial assets, loan commitments, and financial guarantees is recorded within the
respective segment.
Net interest income within Wholesale Banking is calculated on a taxable equivalent basis (TEB), which means that the value of non-taxable or tax-exempt
income, including certain dividends, is adjusted to its equivalent pre-tax value. Using TEB allows the Bank to measure income from all securities and loans
consistently and makes for a more meaningful comparison of net interest income with similar institutions. The TEB increase to net interest income and provision for
income taxes reflected in Wholesale Banking results is reversed in the Corporate segment. The TEB adjustment for the quarter was $23 million, compared with
$18 million in the prior quarter and $16 million in the third quarter last year.
The Bank’s U.S. strategic cards portfolio is comprised of agreements with certain U.S. retailers pursuant to which TD is the U.S. issuer of private label and co-
branded consumer credit cards to their U.S. customers. Under the terms of the individual agreements, the Bank and the retailers share in the profits generated by
the relevant portfolios after credit losses. Under IFRS, TD is required to present the gross amount of revenue and PCL related to these portfolios in the Bank’s
Interim Consolidated Statement of Income. At the segment level, the retailer program partners’ share of revenues and credit losses is presented in the Corporate
segment, with an offsetting amount (representing the partners’ net share) recorded in non-interest expenses, resulting in no impact to the Corporate segment’s
reported net income (loss). The net income included in the U.S. Banking segment includes only the portion of revenue and credit losses attributable to TD under
the agreements.
Effective the first quarter of 2026, non-interest income within U.S. Banking is adjusted for the Bank’s share of losses from community-based tax-advantaged
investments accounted for using the equity method which are reclassified to provision for income taxes. This allows the Bank to measure the effective tax rate for
U.S. Banking consistently with similar institutions. The adjustment between non-interest income and provision for income taxes reflected in U.S. Banking results is
reversed in the Corporate segment. Comparative amounts have been reclassified to conform with the presentation adopted in the first quarter of 2026.
On February 12, 2025, the Bank sold its entire remaining equity investment in Schwab. Prior to the sale, the Bank accounted for its investment in Schwab using
the equity method and the share of net income from investment in Schwab was reported in the U.S. Banking segment. Amounts for amortization of acquired
intangibles, the acquisition and integration charges related to the Schwab transaction, and the Bank’s share of restructuring and other charges incurred by Schwab
were recorded in the Corporate segment. Beginning in the third quarter of fiscal 2025, the U.S. Banking segment no longer includes contributions from Schwab
and consequently discussions of the U.S. Banking segment’s performance exclude Schwab.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 16
TABLE 11: CANADIAN PERSONAL AND COMMERCIAL BANKING
(millions of Canadian dollars, except as noted)
For the three months ended
For the nine months ended
July 31
April 30
July 31
July 31
July 31
2026
2026
2025
2026
2025
Net interest income
$
4,528
$
4,289
$
4,239
$
13,211
$
12,397
Non-interest income
989
967
1,002
2,983
2,984
Total revenue
5,517
5,256
5,241
16,194
15,381
Provision for (recovery of) credit losses – impaired
446
465
376
1,335
1,263
Provision for (recovery of) credit losses – performing
32
33
87
77
343
Total provision for (recovery of) credit losses
478
498
463
1,412
1,606
Non-interest expenses
2,131
2,088
2,066
6,366
6,204
Provision for (recovery of) income taxes
813
745
759
2,352
2,119
Net income
$
2,095
$
1,925
$
1,953
$
6,064
$
5,452
Selected volumes and ratios
Return on common equity
1
32.3
%
31.3
%
32.5
%
31.9
%
31.0
%
Net interest margin (including on securitized assets)
2
2.88
2.85
2.83
2.85
2.82
Efficiency ratio
38.6
39.7
39.4
39.3
40.3
Number of Canadian retail branches at period end
1,037
1,042
1,054
1,037
1,054
Average number of full-time equivalent staff
3
33,355
33,159
32,698
33,394
32,370
1
2
GAAP financial measure. Refer to “Non-GAAP and Other Financial Measures” in the “How We Performed” section and the Glossary of this document for additional information about
these metrics.
3
The change mainly impacts the Canadian Personal and Commercial Banking segment. Average number of full-time equivalent staff has been restated for comparative periods.
Quarterly comparison – Q3 2026 vs. Q3 2025
Canadian Personal and Commercial Banking net income for the quarter was $2,095 million, an increase of $142 million, or 7%, compared with the third quarter
last year, primarily reflecting higher revenue, partially offset by higher non-interest expenses. The annualized ROE for the quarter was 32.3%, compared with
32.5% in the third quarter last year.
Revenue for the quarter was $5,517 million, an increase of $276 million, or 5%, compared with the third quarter last year. Net interest income was
$4,528 million, an increase of $289 million, or 7%, primarily reflecting volume growth and higher margins. Average loan volumes increased $30 billion, or 5%,
reflecting 4% growth in personal loans and 8% growth in business loans. Average deposit volumes increased $12 billion, or 2%, reflecting 1% growth in personal
deposits and 5% growth in business deposits. Net interest margin was 2.88%, an increase of 5 basis points (bps), primarily due to higher margins on deposits and
loans, partially offset by changes in balance sheet mix. Non-interest income was $989 million, a decrease of $13 million, or 1%, compared with the third quarter
last year.
PCL for the quarter was $478 million, an increase of $15 million compared with the third quarter last year. PCL – impaired was $446 million, an increase of
$70 million, or 19%, largely reflecting credit migration in the consumer lending portfolios. PCL – performing was $32 million, a decrease of $55 million compared
with the third quarter last year. The performing provisions this quarter reflect credit migration and volume growth. Total PCL as an annualized percentage of credit
volume was 0.30%, a decrease of 1 basis point (bp) compared with the third quarter last year.
Non-interest expenses for the quarter were $2,131 million, an increase of $65 million, or 3%, compared with the third quarter last year, primarily reflecting higher
employee-related expenses.
The efficiency ratio for the quarter was 38.6%, compared with 39.4% in the third quarter last year.
Quarterly comparison – Q3 2026 vs. Q2 2026
Canadian Personal and Commercial Banking net income for the quarter was $2,095 million, an increase of $170 million, or 9%, compared with the prior quarter,
primarily reflecting higher revenue, partially offset by higher non-interest expenses. The annualized ROE for the quarter was 32.3%, compared with 31.3% in the
prior quarter.
Revenue increased $261 million, or 5%, compared with the prior quarter. Net interest income increased $239 million, or 6%, primarily reflecting more days in
the third quarter and higher margins. Average loan volumes increased $6 billion, or 1%, reflecting 1% growth in personal loans and 2% growth in business loans.
Average deposit volumes increased $4 billion, or 1%, reflecting 1% growth in personal deposits and 1% growth in business deposits. Net interest margin was
2.88%, an increase of 3 bps, primarily due to higher margins on deposits and loans. As we look forward to the fourth quarter, based on current rate and
competitive market dynamics, we expect net interest margin to modestly increase
Non-interest income increased $22 million, or 2%, compared with the prior
quarter, reflecting business growth.
PCL for the quarter was $478 million, a decrease of $20 million compared with the prior quarter. PCL – impaired was $446 million, a decrease of $19 million, or
4%, largely reflecting lower provisions in the commercial lending portfolio. PCL – performing was $32 million, a decrease of $1 million compared with the prior
quarter. The performing provisions this quarter reflect credit migration and volume growth. Total PCL as an annualized percentage of credit volume was 0.30%, a
decrease of 3 bps compared with the prior quarter.
Non-interest expenses increased $43 million, or 2%, compared with the prior quarter, primarily reflecting higher employee-related expenses and other operating
expenses.
The efficiency ratio was 38.6%, compared with 39.7% in the prior quarter.
Year-to-date comparison – Q3 2026 vs. Q3 2025
Canadian Personal and Commercial Banking net income for the nine months ended July 31, 2026, was $6,064 million, an increase of $612 million, or 11%,
compared with the same period last year, reflecting higher revenue and lower PCL, partially offset by higher non-interest expenses. The annualized ROE for the
period was 31.9%, compared with 31.0% in the same period last year.
Revenue for the period was $16,194 million, an increase of $813 million, or 5%, compared with the same period last year. Net interest income was
$13,211 million, an increase of $814 million, or 7%, compared with the same period last year, primarily reflecting volume growth and higher margins. Average loan
volumes increased $32 billion, or 5%, reflecting 5% growth in personal loans and 7% growth in business loans. Average deposit volumes increased $13 billion, or
3%, reflecting 2% growth in personal deposits and 5% growth in business deposits. Net interest margin was 2.85%, an increase of 3 bps, primarily due to higher
10
deposit reinvestment rates and maturity profiles, and are subject to inherent risks and uncertainties, including those set out in the “Risk Factors That May Affect Future Results” section of the Bank's
second quarter 2026 MD&A and third quarter 2026 MD&A.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 17
margins on deposits and loans, partially offset by changes in balance sheet mix. Non-interest income was $2,983 million, relatively flat compared with the same
period last year.
PCL was $1,412 million, a decrease of $194 million compared with the same period last year. PCL – impaired was $1,335 million, an increase of $72 million, or
6%, reflecting credit migration in the consumer lending portfolios, partially offset by lower provisions in the commercial lending portfolio. PCL – performing was
$77 million, a decrease of $266 million compared with the same period last year. The current year performing provisions were largely related to credit migration in
the consumer lending portfolios and volume growth, partially offset by the impact of a model update in the other personal lending portfolios. Total PCL as an
annualized percentage of credit volume was 0.30%, a decrease of 7 bps compared with the same period last year.
Non-interest expenses were $6,366 million, an increase of $162 million, or 3%, compared with the same period last year, reflecting higher employee-related
expenses.
The efficiency ratio was 39.3%, compared with 40.3% for the same period last year.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 18
TABLE 12: U.S. BANKING
(millions of dollars, except as noted)
For the three months ended
For the nine months ended
July 31
April 30
July 31
July 31
July 31
Canadian Dollars
2026
2026
2025
2026
2025
Net interest income – reported
$
$
$
$
$
Net interest income – adjusted
1,2
Non-interest income – reported
3
Non-interest income – adjusted
1,3,4
Total revenue – reported
Total revenue – adjusted
1
Provision for (recovery of) credit losses – impaired
Provision for (recovery of) credit losses – performing
(9)
(13)
(98)
Total provision for (recovery of) credit losses
Non-interest expenses – reported
Non-interest expenses – adjusted
1,5
Provision for (recovery of) income taxes – reported
3
Provision for (recovery of) income taxes – adjusted
1,3
U.S. Banking net income excluding Schwab – reported
U.S. Banking net income excluding Schwab – adjusted
1
Share of net income from investment in Schwab
6,7
–
–
–
–
U.S. Banking net income – reported
$
$
$
$
$
U.S. Banking net income – adjusted
1
U.S. Dollars
Net interest income – reported
$
$
$
$
$
Net interest income – adjusted
1,2
Non-interest income – reported
3
Non-interest income – adjusted
1,3,4
Total revenue – reported
Total revenue – adjusted
1
Provision for (recovery of) credit losses – impaired
Provision for (recovery of) credit losses – performing
(7)
(9)
(72)
Total provision for (recovery of) credit losses
Non-interest expenses – reported
Non-interest expenses – adjusted
1,5
Provision for (recovery of) income taxes – reported
3
Provision for (recovery of) income taxes – adjusted
1,3
U.S. Banking net income excluding Schwab – reported
U.S. Banking net income excluding Schwab – adjusted
1
Share of net income from investment in Schwab
6,7
–
–
–
–
U.S. Banking net income – reported
$
$
$
$
$
U.S. Banking net income – adjusted
1
Selected volumes and ratios
U.S. Banking return on common equity excluding Schwab – reported
8
%
%
%
%
%
U.S. Banking return on common equity excluding Schwab – adjusted
1,8
U.S. Banking return on common equity – reported
8
U.S. Banking return on common equity – adjusted
1,8
Net interest margin
1,9
Net interest margin – adjusted
1,9
Efficiency ratio – reported
3
Efficiency ratio – adjusted
1,3
Assets under administration (billions of U.S. dollars)
10
$
$
$
$
$
Assets under management (billions of U.S. dollars)
10
Number of U.S. banking stores
Average number of full-time equivalent staff
1
document.
2
i.
3
method which are reclassified to provision for income taxes. The adjustment between non-interest income and provision for income taxes reflected in U.S. Banking results is reversed in the Corporate
segment. The adjustment for the quarter was $185 million (US$132 million), compared with $179 million (US$131 million) in the prior quarter, and $165 million (US$120 million) in the third quarter last
year, 2026 YTD: $548 million (US$395 million); 2025 YTD: $490 million (US$349 million). Comparative amounts have been reclassified to conform with the presentation adopted effective the first quarter
of 2026.
4
i.
after tax).
ii.
US$144 million ($147 million or US$107 million after tax), 2026 YTD: $197 million or US$144 million ($147 million or US$107 million after tax).
5
i.
6
7
8
9
of intercompany deposits and cash collateral, which management believes better reflects segment performance. In addition, the value of tax-exempt interest income is adjusted to its equivalent before-
tax value. For investment securities, the adjustment to fair value is included in the calculation of average interest-earning assets. Net interest income and average interest-earning assets used in the
calculation are non-GAAP financial measures.
10
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 19
On February 12, 2025, the Bank sold its entire remaining equity investment in Schwab. Discussions of the U.S. Banking segment's performance exclude Schwab.
Refer to the "Significant Events" section of the Bank's 2025 Annual Report for further details.
During the second quarter of fiscal 2026, the Bank completed the conversion of its Nordstrom credit card portfolio onto the Bank’s servicing platform and received
a greater share of revenue and credit losses. The Bank incurred a charge of $197 million (US$144 million) pre-tax, in the second quarter of fiscal 2026, reflecting
an adjustment of amounts which will no longer be recovered from Nordstrom for expected credit losses ("receivable adjustment").
Aligned with the U.S. Banking segment's priority to optimize its store network as outlined in the Bank's 2025 MD&A and subject to regulatory approval, U.S.
Banking expects to open 100 new stores by the end of calendar 2028
Quarterly comparison – Q3 2026 vs. Q3 2025
U.S. Banking reported and adjusted net income for the quarter was $1,074 million (US$771 million). Reported net income increased $314 million (US$217 million),
or 41% (39% in U.S. dollars), compared with the third quarter last year, reflecting the impact of U.S. balance sheet restructuring activities, higher deposit and loan
margins, and an adjustment for client deposit rates in the prior year, partially offset by higher expenses. Adjusted net income increased $118 million
(US$76 million), or 12% (11% in U.S. dollars), compared with the third quarter last year, reflecting higher deposit and loan margins, and an adjustment for client
deposit rates in the prior year, partially offset by higher expenses. The annualized ROE for the quarter was 10.2%, compared with 7.1%, on a reported basis, and
8.9%, on an adjusted basis, in the third quarter last year.
Reported and adjusted revenue for the quarter was US$2,987 million, an increase of US$335 million, or 13%, on a reported basis, and an increase of
US$147 million, or 5%, on an adjusted basis, compared with the third quarter last year. Net interest income of US$2,403 million, increased US$147 million, or 7%,
largely reflecting higher loan margins including higher revenue due to the strategic card platform conversion, higher deposit margins, and an adjustment for client
deposit rates in the prior year. Net interest margin of 3.47%, increased 28 bps, due to higher loan margins including higher revenue due to the strategic card
platform conversion, and higher deposit margins. Non-interest income was US$584 million, an increase of US$188 million, or 47%, on a reported basis, compared
with the third quarter last year, reflecting the impact of U.S. balance sheet restructuring activities in the prior year. On an adjusted basis, non-interest income was
flat, compared with the third quarter last year.
Average loan volumes decreased US$6 billion, or 4%, compared with the third quarter last year. Personal loans increased 1% and business loans decreased
8%, reflecting U.S. balance sheet restructuring activities. Excluding the impact of the loan portfolios identified for sale or run-off under our U.S. balance sheet
restructuring program, core average loan volumes increased US$4 billion, or 3%
. Average deposit volumes decreased US$16 billion, or 5%, reflecting a 13%
decrease in sweep deposits, a 3% decrease in business deposits, and a 2% decrease in personal deposits.
Assets under administration (AUA) were US$47 billion as at July 31, 2026, an increase of US$1 billion, or 2%, compared with the third quarter last year, and
assets under management (AUM) were US$12 billion as of July 31, 2026, an increase of US$2 billion, or 20%, compared with the third quarter last year, both
reflecting net asset growth and market appreciation.
PCL for the quarter was US$227 million, a decrease of US$4 million compared with the third quarter last year. PCL – impaired was US$234 million, a decrease
of US$6 million, or 3%, reflecting lower provisions in the commercial lending portfolio, partially offset by credit migration in the consumer lending portfolios. PCL –
performing was a recovery of US$7 million, compared with a recovery of US$9 million in the third quarter last year. The current quarter performing recovery was
recorded in both the consumer and commercial lending portfolios. U.S. Banking PCL including only the Bank’s share of PCL in the U.S. strategic cards portfolio, as
an annualized percentage of credit volume was 0.53%, an increase of 1 bp compared with the third quarter last year.
Non-interest expenses for the quarter were US$1,830 million, an increase of US$98 million, or 6%, compared to the third quarter last year, reflecting conversion
costs associated with the strategic card portfolio, higher employee-related expenses, and higher spend supporting business growth initiatives, partially offset by
lower governance and control investments, including costs of US$125 million for U.S. BSA/AML remediation.
The efficiency ratio for the quarter was 61.3%, compared with 65.3%, on a reported basis, and 61.0%, on an adjusted basis, in the third quarter last year.
Quarterly comparison – Q3 2026 vs. Q2 2026
U.S. Banking reported and adjusted net income for the quarter was $1,074 million (US$771 million). Reported net income increased $261 million (US$176 million),
or 32% (30% in U.S. dollars), compared with the prior quarter, reflecting the impact of additional days in the current quarter, higher deposit and loan margins, the
receivable adjustment in the U.S. strategic cards portfolio in the prior quarter, and lower PCL, partially offset by higher expenses. Adjusted net income increased
$114 million (US$69 million), or 12% (10% in U.S. dollars), compared to the prior quarter, reflecting the impact of additional days in the current quarter, higher
deposit and loan margins, and lower PCL, partially offset by higher expenses. The annualized ROE for the quarter was 10.2%, compared with 8.2%, on a reported
basis, and 9.6%, on an adjusted basis, in the prior quarter.
Reported and adjusted revenue for the quarter was US$2,987 million, an increase of US$225 million, or 8%, on a reported basis, and an increase of
US$81 million, or 3%, on an adjusted basis, compared with the prior quarter. Net interest income of US$2,403 million, increased US$71 million, or 3%, largely
reflecting the impact of additional days in the third quarter, higher loan margins including higher revenue due to the strategic card platform conversion, and higher
deposit margins. Net interest margin of 3.47%, increased 6 bps, due to higher loan margins including higher revenue due to the strategic card platform conversion,
and higher deposit margins. Net interest margin is expected to modestly increase in the fourth quarter of fiscal 2026
an increase of US$154 million, or 36%, on a reported basis, compared with the prior quarter, reflecting the receivable adjustment in the U.S. strategic cards
portfolio in the prior quarter, and higher fee income. On an adjusted basis, non-interest income increased US$10 million, or 2%, compared with prior quarter,
reflecting higher fee income.
Average loan volumes in personal and business loans, were both flat, compared with the prior quarter. Excluding the impact of the loan portfolios identified for
sale or run-off under our U.S. balance sheet restructuring program, core average loan volumes increased US$1 billion, or 1%
Average deposit volumes
decreased US$4 billion, or 1%, compared with the prior quarter, reflecting a 2% decrease in sweep deposits, and a 1% decrease in personal deposits. Business
deposits were flat compared to the prior quarter.
AUA were US$47 billion as at July 31, 2026, an increase of US$1 billion, or 2%, compared with the prior quarter, and AUM were US$12 billion as at
July 31, 2026, an increase of US$1 billion, or 9%, compared with the prior quarter, both reflecting net asset growth and market appreciation.
11
Any new store opening is subject to approval by the OCC and the targeted number of new stores is based on assumptions regarding the availability of appropriate real estate in the geographies
currently identified by management and successful execution of management's store optimization plan, and other variables, and is subject to inherent risks and uncertainties, including those set out in
the “Risk Factors That May Affect Future Results” section of this document.
12
Loan portfolios identified for sale or run-off include the Point-of-Sale finance business which services third party retailers, correspondent lending, export and import lending, commercial auto dealer
portfolio, and other non-core portfolios. Q3 2026 average loan volumes: US$173 billion (Q2 2026: US$173 billion; 2026 YTD: US$174 billion; Q3 2025: US$180 billion; 2025 YTD: US$186 billion).
Q3 2026 average loan volumes of loan portfolios identified for sale or run-off: US$8 billion (Q2 2026: US$9 billion; 2026 YTD: US$10 billion; Q3 2025: US$19 billion; 2025 YTD: US$26 billion). Q3 2026
average loan volumes excluding loan portfolios identified for sale or run-off: US$165 billion (Q2 2026: US$164 billion; 2026 YTD: US$164 billion; Q3 2025: US$161 billion; 2025 YTD: US$160 billion).
13
14
planned restructuring opportunities, and other variables, and are subject to inherent risks and uncertainties, including those set out in the “Risk Factors That May Affect Future Results” section of this
document.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 20
PCL for the quarter was US$227 million, a decrease of US$23 million compared with the prior quarter. PCL – impaired was US$234 million, a decrease of
US$9 million, or 4%, reflecting lower provisions in the commercial lending portfolio. PCL – performing was a recovery of US$7 million, compared with a build of
US$7 million in the prior quarter. The current quarter performing recovery was recorded in both the consumer and commercial lending portfolios. U.S. Banking PCL
including only the Bank’s share of PCL in the U.S. strategic cards portfolio, as an annualized percentage of credit volume was 0.53%, a decrease of 7 bps
compared with the prior quarter.
Non-interest expenses for the quarter were US$1,830 million, an increase of US$23 million, or 1%, compared with the prior quarter, reflecting conversion costs
associated with the strategic card portfolio, and higher employee-related expenses, partially offset by lower governance and control investments, including costs
for U.S. BSA/AML remediation.
The efficiency ratio for the quarter was 61.3%, compared with 65.4%, on a reported basis, and 62.2%, on an adjusted basis, in the prior quarter.
Year-to-date comparison – Q3 2026 vs. Q3 2025
U.S. Banking reported net income for the nine months ended July 31, 2026, was $2,927 million (US$2,113 million), an increase of $1,982 million
(US$1,419 million), compared with the same period last year, reflecting the impact of U.S. balance sheet restructuring activities, lower PCL, and the expense
recovery of the FDIC special assessment charge, partially offset by higher governance and control investments, including costs for U.S. BSA/AML remediation,
and the receivable adjustment in the U.S. strategic cards portfolio. U.S. Banking adjusted net income was $3,041 million (US$2,196 million), an increase of
$357 million (US$281 million), or 13% (15% in U.S. dollars), reflecting the impact of U.S. balance sheet restructuring activities and lower PCL, partially offset by
higher governance and control investments, including costs for U.S. BSA/AML remediation. The reported and adjusted annualized ROE for the period were 9.4%
and 9.8%, respectively, compared with 3.0% and 8.2%, respectively, in the same period last year.
Reported revenue for the period was US$8,690 million, an increase of US$2,017 million, or 30%, compared with the same period last year. On an adjusted
basis, revenue for the period was US$8,834 million, an increase of US$533 million, or 6%, compared with the same period last year. Reported and adjusted net
interest income of US$7,107 million, increased US$555 million, or 8%, on a reported basis, and increased US$530 million, or 8%, on an adjusted basis, reflecting
higher loan margins including higher revenue due to the strategic card platform conversion, higher deposit margins, the impact of U.S. balance sheet restructuring
activities, and an adjustment for client deposit rates as well as the deferred cost adjustment in the prior year. Net interest margin of 3.42%, increased 40 bps, and
increased 39 bps on an adjusted basis, both due to higher loan margins including higher revenue due to the strategic card platform conversion, higher deposit
margins, and U.S. balance sheet restructuring activities. Reported non-interest income of US$1,583 million, increased US$1,462 million, primarily reflecting the
impact of U.S. balance sheet restructuring activities in the prior year, partially offset by the receivable adjustment in the U.S. strategic cards portfolio. On an
adjusted basis, non-interest income of US$1,727 million, was relatively flat, compared with the same period last year.
Average loan volumes for the period decreased US$12 billion, or 7%, compared with the same period last year, reflecting a 10% decrease in business loans and
a 3% decrease in personal loans. Excluding the impact of the loan portfolios identified for sale or run-off under our U.S. balance sheet restructuring program,
average loan volumes for the period increased US$4 billion, or 2%, compared with the same period last year
. Average deposit volumes decreased
US$16 billion, or 5%, reflecting a 13% decrease in sweep deposits, a 2% decrease in personal deposits, and a 2% decrease in business deposits, compared with
the same period last year.
PCL was US$689 million, a decrease of US$171 million compared with the same period last year. PCL – impaired was US$761 million, a decrease of
US$66 million, or 8%, largely reflecting lower provisions in the commercial lending portfolio. PCL – performing was a recovery of US$72 million, compared with a
build of US$33 million in the same period last year. The current year performing recovery reflects lower volume and an update to the macroeconomic outlook,
partially offset by credit migration in both the consumer and commercial lending portfolios. U.S. Banking PCL including only the Bank’s share of PCL in the U.S.
strategic cards portfolio, as an annualized percentage of credit volume was 0.54%, a decrease of 9 bps, compared with the same period last year.
Reported non-interest expenses for the period were US$5,415 million, an increase of US$364 million, or 7%, compared with the same period last year, reflecting
higher governance and control investments, including costs for U.S. BSA/AML remediation, higher employee-related expenses, spend supporting business growth
initiatives, and conversion costs associated with the strategic card portfolio, partially offset by the expense recovery of the FDIC special assessment charge. On an
adjusted basis, non-interest expenses for the period were US$5,447 million, increased US$396 million, or 8%, reflecting higher governance and control
investments, including costs for U.S. BSA/AML remediation, higher employee-related expenses, spend supporting business growth initiatives, and conversion
costs associated with the strategic card portfolio.
The reported and adjusted efficiency ratios for the period were 62.3% and 61.7%, respectively, compared with 75.7% and 60.8%, respectively, for the same
period last year.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 21
TABLE 13: WEALTH MANAGEMENT AND INSURANCE
(millions of Canadian dollars, except as noted)
For the three months ended
For the nine months ended
July 31
April 30
July 31
July 31
July 31
2026
2026
2025
2026
2025
Net interest income
$
466
$
423
$
373
$
1,295
$
1,104
Non-interest income
3,619
3,355
3,300
10,474
9,670
Total revenue
4,085
3,778
3,673
11,769
10,774
Insurance service expenses
1
1,646
1,398
1,563
4,666
4,487
Non-interest expenses
1,296
1,249
1,155
3,803
3,459
Provision for (recovery of) income taxes
302
294
252
865
738
Net income
$
841
$
837
$
703
$
2,435
$
2,090
Selected volumes and ratios
Return on common equity
49.0
%
51.2
%
44.7
%
48.5
%
44.7
%
Return on common equity – Wealth Management
2
72.5
65.0
62.4
68.0
60.7
Return on common equity – Insurance
23.1
35.9
24.7
27.1
26.4
Efficiency ratio
31.7
33.1
31.4
32.3
32.1
Efficiency ratio, net of ISE
3
53.1
52.5
54.7
53.5
55.0
Assets under administration (billions of Canadian dollars)
4
$
831
$
797
$
709
$
831
$
709
Assets under management (billions of Canadian dollars)
5
644
617
572
644
572
Average number of full-time equivalent staff
16,092
16,023
15,443
15,995
15,271
1
2
3
Q3 2025: $2,110 million, 2026 YTD: $7,103 million, 2025 YTD: $6,287 million. Total revenue, net of ISE is a non-GAAP financial measure. Refer to “Non-GAAP and Other Financial
Measures” in the “How We Performed” section and the Glossary of this document for additional information about this metric.
4
Includes
AUA administered by TD Investment Services Inc. which is part of the Canadian Personal and Commercial Banking segment.
5
Quarterly comparison – Q3 2026 vs. Q3 2025
Wealth Management and Insurance net income for the quarter was $841 million, an increase of $138 million, or 20%, compared with the third quarter last year,
reflecting Wealth Management net income of $653 million, an increase of $132 million, or 25%, compared with the third quarter last year, and Insurance net
income of $188 million, an increase of $6 million, or 3%, compared with the third quarter last year. The annualized ROE for the quarter was 49.0%, compared with
44.7% in the third quarter last year. Wealth Management annualized ROE for the quarter was 72.5%, compared with 62.4% in the third quarter last year, and
Insurance annualized ROE for the quarter was 23.1% compared with 24.7% in the third quarter last year.
Revenue for the quarter was $4,085 million, an increase of $412 million, or 11%, compared with the third quarter last year. Non-interest income was
$3,619 million, an increase of $319 million, or 10%, reflecting higher fee-based revenue from asset growth and higher insurance earned premiums. Net interest
income was $466 million, an increase of $93 million, or 25%, compared with the third quarter last year, reflecting higher deposit volumes.
AUA were $831 billion as at July 31, 2026, an increase of $122 billion, or 17%, and AUM were $644 billion as at July 31, 2026, an increase of $72 billion, or
13%, compared with the third quarter last year, both reflecting market appreciation and net asset growth.
Insurance service expenses for the quarter were $1,646 million, an increase of $83 million or 5%, compared with the third quarter last year, mainly driven by
higher estimated losses from catastrophe claims.
Non-interest expenses for the quarter were $1,296 million, an increase of $141 million, or 12%, compared with the third quarter last year, mainly reflecting
higher variable compensation commensurate with higher revenue and increased employee-related expenses.
The efficiency ratio for the quarter was 31.7%, compared with 31.4% in the third quarter last year. The efficiency ratio, net of ISE for the quarter was 53.1%,
compared with 54.7% in the third quarter last year.
Quarterly comparison – Q3 2026 vs. Q2 2026
Wealth Management and Insurance net income for the quarter was $841 million, relatively flat compared with the prior quarter, reflecting Wealth Management net
income of $653 million, an increase of $95 million or 17% compared with the prior quarter, and Insurance net income of $188 million, a decrease of $91 million, or
33%, compared with the prior quarter. The annualized ROE for the quarter was 49.0%, compared with 51.2% in the prior quarter. Wealth Management annualized
ROE for the quarter was 72.5%, compared with 65.0% in the prior quarter, and Insurance annualized ROE for the quarter was 23.1%, compared with 35.9% in the
prior quarter.
Revenue increased $307 million, or 8%, compared with the prior quarter. Non-interest income increased $264 million, or 8%, mainly reflecting the impact of
more days in the third quarter, fee-based revenue growth and transaction revenue.
AUA increased $34 billion, or 4%, and AUM increased $27 billion, or 4%, compared with the prior quarter, both reflecting market appreciation.
Insurance service expenses increased $248 million, or 18%, compared with the prior quarter, mainly driven by higher estimated losses from catastrophe claims
and higher claims frequency.
Non-interest expenses increased $47 million, or 4%, compared with the prior quarter, mainly reflecting higher variable compensation commensurate with higher
revenue.
The efficiency ratio for the quarter was 31.7%, compared with 33.1% in the prior quarter. The efficiency ratio, net of ISE, for the quarter was 53.1%, compared
with 52.5% in the prior quarter.
Year-to-date comparison – Q3 2026 vs. Q3 2025
Wealth Management and Insurance net income for the nine months ended July 31, 2026, was $2,435 million, an increase of $345 million, or 17%, compared with
the same period last year, reflecting Wealth Management net income of $1,785 million, an increase of $272 million, or 18%, compared with the same period last
year, and Insurance net income of $650 million, an increase of $73 million, or 13%, compared with the same period last year. The annualized ROE for the period
was 48.5%, compared with 44.7% in the same period last year. Wealth Management annualized ROE for the period was 68.0%, compared with 60.7% in the same
period last year, and Insurance annualized ROE for the period was 27.1%, compared with 26.4% in the same period last year.
Revenue for the period was $11,769 million, an increase of $995 million, or 9%, compared with the same period last year. Non-interest income increased
$804 million, or 8%, reflecting higher insurance earned premiums, fee-based revenue from asset growth, and transaction revenue. Net interest income increased
$191 million, or 17%, primarily reflecting higher deposit volumes.
Insurance service expenses were $4,666 million, an increase of $179 million, or 4%, compared with the same period last year, primarily driven by increased
claims severity, higher estimated losses from catastrophe claims and higher costs due to business growth initiatives.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 22
Non-interest expenses were $3,803 million, an increase of $344 million, or 10%, compared with the same period last year, reflecting higher variable
compensation commensurate with higher revenue, increased employee-related expenses and spend supporting business growth initiatives.
The efficiency ratio for the period was 32.3%, compared with 32.1% for the same period last year. The efficiency ratio, net of ISE, for the period was 53.5%,
compared with 55.0% in the same period last year.
TABLE 14: WHOLESALE BANKING
(millions of Canadian dollars, except as noted)
For the three months ended
For the nine months ended
July 31
April 30
July 31
July 31
July 31
2026
2026
2025
2026
2025
Net interest income (loss) (TEB)
$
270
$
276
$
110
$
471
$
48
Non-interest income
2,311
2,117
1,953
6,973
6,144
Total revenue
2,581
2,393
2,063
7,444
6,192
Provision for (recovery of) credit losses – impaired
6
80
63
302
157
Provision for (recovery of) credit losses – performing
35
(2)
8
(11)
109
Total provision for (recovery of) credit losses
41
78
71
291
266
Non-interest expenses – reported
1,594
1,509
1,493
4,666
4,489
Non-interest expenses – adjusted
1,2
1,594
1,509
1,461
4,666
4,371
Provision for (recovery of) income taxes – reported (TEB)
203
194
101
571
321
Provision for (recovery of) income taxes – adjusted (TEB)
1
203
194
108
571
347
Net income – reported
$
743
$
612
$
398
$
1,916
$
1,116
Net income – adjusted
1
743
612
423
1,916
1,208
Selected volumes and ratios
Trading-related revenue (TEB)
1,3
$
975
$
868
$
873
$
2,989
$
2,633
Average gross lending portfolio (billions of Canadian dollars)
4
111.8
100.0
96.8
101.9
100.3
Return on common equity – reported
5
16.7
%
14.5
%
9.3
%
14.6
%
9.0
%
Return on common equity – adjusted
1,5
16.7
14.5
9.9
14.6
9.7
Efficiency ratio – reported
61.7
63.1
72.4
62.7
72.5
Efficiency ratio – adjusted
1
61.7
63.1
70.8
62.7
70.6
Average number of full-time equivalent staff
7,417
7,226
7,342
7,327
7,078
1
Glossary of this document.
2
($92 million after tax).
3
of $1,150 million, (Q2 2026: $989 million, Q3 2025: $1,104 million, 2026 YTD: $3,740 million, 2025 YTD: $3,540 million). Trading-related revenue (TEB) is a non-GAAP financial measure.
4
5
Quarterly comparison – Q3 2026 vs. Q3 2025
Wholesale Banking reported and adjusted net income for the quarter was $743 million. Reported net income for the quarter increased $345 million, or 87%,
compared with the third quarter last year, primarily reflecting higher revenues and lower PCL, partially offset by higher non-interest expenses. On an adjusted
basis, net income increased $320 million, or 76%, compared with the third quarter last year.
Revenue for the quarter was $2,581 million, an increase of $518 million, or 25%, compared with the third quarter last year. Higher revenue primarily reflects
higher lending revenue, underwriting fees, and trading-related revenue.
PCL for the quarter was $41 million, a decrease of $30 million compared with the third quarter last year. PCL – impaired was $6 million, a decrease of
$57 million compared with the prior year, reflecting higher impairments in the prior year. PCL – performing was a build of $35 million, an increase of $27 million
compared with the prior year. The performing build this quarter largely reflects credit migration and volume growth.
Reported and adjusted non-interest expenses for the quarter were $1,594 million. Reported non-interest expenses increased $101 million, or 7%, compared
with the third quarter last year, primarily reflecting higher variable compensation and front office costs, partially offset by the cessation of acquisition and
integration-related costs. On an adjusted basis, non-interest expenses increased $133 million, or 9%.
Quarterly comparison – Q3 2026 vs. Q2 2026
Wholesale Banking net income for the quarter was $743 million. Net income increased $131 million, or 21%, compared with the prior quarter, primarily reflecting
higher revenues and lower PCL, partially offset by higher non-interest expenses.
Revenue for the quarter increased $188 million, or 8%, compared with the prior quarter. Higher revenue primarily reflects higher trading-related revenue and
advisory fees.
PCL for the quarter was $41 million, a decrease of $37 million compared with the prior quarter. PCL – impaired was $6 million, a decrease of $74 million
compared with the prior quarter, reflecting higher impairments in the prior quarter. PCL – performing was a build of $35 million, compared with a recovery of
$2 million in the prior quarter. The performing build this quarter largely reflects credit migration and volume growth.
Non-interest expenses for the quarter increased $85 million, or 6%, compared with the prior quarter, primarily reflecting higher variable compensation and front
office costs.
Year-to-date comparison – Q3 2026 vs. Q3 2025
Wholesale Banking reported and adjusted net income for the nine months ended July 31, 2026 was $1,916 million. Reported net income for the period increased
$800 million, or 72%, compared with the same period last year, primarily reflecting higher revenues, partially offset by higher non-interest expenses and PCL. On
an adjusted basis, net income increased $708 million, or 59%.
Revenue for the period was $7,444 million, an increase of $1,252 million, or 20%, compared with the same period last year. Higher revenue primarily reflects
higher lending revenue, trading-related revenue, and underwriting and advisory fees.
PCL was $291 million, an increase of $25 million compared with the same period last year. PCL – impaired was $302 million, an increase of $145 million,
reflecting a small number of impairments across various industries. PCL – performing was a recovery of $11 million, compared with a build of $109 million in the
same period last year. The current year performing recovery was driven by migration from performing to impaired, partially offset by volume growth.
Reported and adjusted non-interest expenses were $4,666 million. Reported non-interest expenses increased $177 million, or 4%, compared with the same
period last year, primarily reflecting higher variable compensation, front office costs, and spend supporting business growth, partially offset by the cessation of
acquisition and integration-related costs. On an adjusted basis, non-interest expenses increased $295 million, or 7%.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 23
TABLE 15: CORPORATE
(millions of Canadian dollars)
For the three months ended
For the nine months ended
July 31
April 30
July 31
July 31
July 31
2026
2026
2025
2026
2025
Net income (loss) – reported
$
(138)
$
64
$
(478)
$
(433)
$
7,378
Adjustments for items of note
Amortization of acquired intangibles
34
33
33
101
137
Restructuring charges
–
–
333
200
496
Impact from the terminated FHN acquisition-related capital hedging strategy
41
43
55
128
156
Gain on sale of Schwab shares
–
–
–
–
(8,975)
Less: impact of income taxes
Gain on sale of Schwab shares
1
–
288
–
288
(407)
Other items of note
19
18
107
109
190
Net income (loss) – adjusted
2
$
(82)
$
(166)
$
(164)
$
(401)
$
(591)
Decomposition of items included in net income (loss) – adjusted
Net corporate expenses
3
$
(462)
$
(543)
$
(477)
$
(1,520)
$
(1,278)
Other
380
377
313
1,119
687
Net income (loss) – adjusted
2
$
(82)
$
(166)
$
(164)
$
(401)
$
(591)
Selected volumes
Average number of full-time equivalent staff
4
18,024
18,111
18,725
18,077
18,293
1
"Income Taxes" in the "Financial Results Overview" section of this document for further details.
2
Glossary of this document.
3
4
The change mainly impacts the Canadian Personal and Commercial Banking segment. Average number of full-time equivalent staff has been restated for comparative periods.
Quarterly comparison – Q3 2026 vs. Q3 2025
Corporate segment’s reported net loss for the quarter was $138 million, compared with $478 million in the third quarter last year. The lower net loss primarily
reflects restructuring charges in the prior year. The adjusted net loss for the quarter was $82 million, compared with $164 million in the third quarter last year. The
lower adjusted loss is driven primarily by higher revenue from treasury and balance sheet management activities.
Quarterly comparison – Q3 2026 vs. Q2 2026
Corporate segment’s reported net loss for the quarter was $138 million, compared with a reported net income of $64 million in the prior quarter. The quarter-over-
quarter change primarily reflects the second quarter impact of a tax benefit related to the prior year's gain on sale of Schwab shares. The adjusted net loss for the
quarter was $82 million, compared with $166 million in the prior quarter. The lower adjusted loss is driven primarily by lower net corporate expenses and
favourability from tax benefits.
Year-to-date comparison – Q3 2026 vs. Q3 2025
Corporate segment’s reported net loss for the nine months ended July 31, 2026 was $433 million, compared with a reported net income of $7,378 million in the
same period last year. The year-over-year change primarily reflects the gain on sale of Schwab shares in the prior year. The adjusted net loss for the nine months
ended July 31, 2026 was $401 million, compared with $591 million in the same period last year. The lower adjusted loss is driven by higher revenue from treasury
and balance sheet management activities, partially offset by increased net corporate expenses. Net corporate expenses increased $242 million compared to the
same period last year, primarily reflecting continued investments in governance and controls.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 24
QUARTERLY RESULTS
The following table provides summary information related to the Bank’s eight most recently completed quarters.
TABLE 16: QUARTERLY RESULTS
(millions of Canadian dollars, except as noted)
For the three months ended
2026
2026
2026
2025
2024
Jul. 31
Apr. 30
Jan. 31
Oct. 31
Jul. 31
Apr. 30
Jan. 31
Oct. 31
Net interest income
$
9,296
$
8,861
$
8,789
$
8,545
$
8,526
$
8,125
$
7,866
$
7,940
Non-interest income
7,589
6,936
7,796
6,949
6,771
14,812
6,183
7,574
Total revenue
16,885
15,797
16,585
15,494
15,297
22,937
14,049
15,514
Provision for (recovery of) credit losses
917
1,001
1,039
982
971
1,341
1,212
1,109
Insurance service expenses
1,646
1,398
1,622
1,602
1,563
1,417
1,507
2,364
Non-interest expenses
8,475
8,372
8,753
8,808
8,522
8,139
8,070
8,050
Provision for (recovery of) income taxes
1,232
775
1,128
822
905
985
698
534
Share of net income from investment in Schwab
–
–
–
–
–
74
231
178
Net income – reported
4,615
4,251
4,043
3,280
3,336
11,129
2,793
3,635
Pre-tax adjustments for items of note
1
Amortization of acquired intangibles
34
33
34
34
33
43
61
60
Acquisition and integration charges related to the
Schwab transaction
2,3
–
–
–
–
–
–
–
35
Restructuring charges
–
–
200
190
333
163
–
–
Acquisition and integration-related charges
–
–
–
44
32
34
52
82
Impact from the terminated FHN acquisition-related
capital hedging strategy
41
43
44
49
55
47
54
59
Gain on sale of Schwab shares
–
–
–
–
–
(8,975)
–
(1,022)
Balance sheet restructuring
–
–
–
485
262
1,129
927
311
Indirect tax matters
2,4
–
–
–
–
–
–
–
226
FDIC special assessment
–
–
(44)
–
–
–
–
(72)
Change in partnership share in the U.S. strategic
cards portfolio
–
197
–
–
–
–
–
–
Global resolution of the investigations into the
Bank’s U.S. BSA/AML program
2
–
–
–
–
–
–
–
52
Total pre-tax adjustments for items of note
1
75
273
234
802
715
(7,559)
1,094
(269)
Less: Impact of income taxes
19
356
61
177
180
(56)
264
161
Net income – adjusted
1
4,671
4,168
4,216
3,905
3,871
3,626
3,623
3,205
Preferred dividends and distributions on other
equity instruments
94
202
101
191
88
200
86
193
Net income available to common
shareholders – adjusted
1
$
4,577
$
3,966
$
4,115
$
3,714
$
3,783
$
3,426
$
3,537
$
3,012
(Canadian dollars, except as noted)
Basic earnings per share
Reported
$
2.75
$
2.44
$
2.35
$
1.82
$
1.89
$
6.28
$
1.55
$
1.97
Adjusted
1
2.78
2.39
2.45
2.19
2.20
1.97
2.02
1.72
Diluted earnings per share
Reported
2.74
2.43
2.34
1.82
1.89
6.27
1.55
1.97
Adjusted
1
2.77
2.38
2.44
2.18
2.20
1.97
2.02
1.72
Return on common equity – reported
15.8
%
14.7
%
13.6
%
10.7
%
11.3
%
39.1
%
10.1
%
13.4
%
Return on common equity – adjusted
1
16.0
14.4
14.2
12.8
13.2
12.3
13.2
11.7
(billions of Canadian dollars, except as noted)
Average total assets
$
2,147
$
2,098
$
2,121
$
2,102
$
2,112
$
2,156
$
2,063
$
2,035
Average interest-earning assets
5
1,909
1,865
1,882
1,863
1,855
1,894
1,883
1,835
Net interest margin
1
1.93
%
1.95
%
1.85
%
1.82
%
1.82
%
1.76
%
1.66
%
1.72
%
Net interest margin – adjusted
1
1.94
1.96
1.86
1.83
1.83
1.78
1.67
1.74
1
document.
2
i.
ii.
iii.
3
segment:
i.
4
i.
5
Performed” section and the Glossary of this document for additional information about these metrics.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 25
BALANCE SHEET REVIEW
TABLE 17: SELECTED INTERIM CONSOLIDATED BALANCE SHEET ITEMS
(millions of Canadian dollars)
As at
July 31, 2026
October 31, 2025
Assets
Cash and interest-bearing deposits with banks
$
110,632
$
116,929
Trading loans, securities, and other
218,133
220,136
Non-trading financial assets at fair value through profit or loss
9,534
7,395
Derivatives
80,055
82,972
Financial assets designated at fair value through profit or loss
7,071
6,986
Financial assets at fair value through other comprehensive income
135,092
126,369
Debt securities at amortized cost, net of allowance for credit losses
236,855
240,439
Securities purchased under reverse repurchase agreements
231,368
247,078
Loans, net of allowance for loan losses
991,036
953,012
Other
92,085
93,242
Total assets
$
2,111,861
$
2,094,558
Liabilities
Trading deposits
$
43,486
$
37,882
Derivatives
75,308
79,356
Financial liabilities designated at fair value through profit or loss
213,022
197,635
Deposits
1,260,724
1,267,104
Obligations related to securities sold under repurchase agreements
228,932
221,150
Subordinated notes and debentures
10,523
10,733
Other
152,851
152,871
Total liabilities
1,984,846
1,966,731
Total equity
127,015
127,827
Total liabilities and equity
$
2,111,861
$
2,094,558
Total assets
The increase in total assets reflects an increase in loans net of allowances for loan losses of $38 billion, financial assets at fair value through other comprehensive
income (FVOCI) of $9 billion, non-trading financial assets at fair value through profit or loss (FVTPL) of $2 billion. The increase was partially offset by a decrease in
securities purchased under reverse repurchase agreements of $16 billion, cash and interest-bearing deposits with banks of $6 billion, debt securities at amortized
cost, net of allowance for credit losses of $4 billion, derivatives of $3 billion, trading loans, securities, and other of $2 billion, and other assets of $1 billion.
Cash and interest-bearing deposits with banks
decreased $6 billion primarily driven by cash management activities.
Trading loans, securities, and other
decreased $2 billion primarily in commodities held-for-trading, partially offset by an increase in equity securities and
securitized mortgages.
Non-trading financial assets at fair value through profit or loss
Derivative
assets decreased $3 billion primarily reflecting a decrease in the mark-to-market values of foreign exchange contracts, partially offset by an increase in
equity contracts and interest rate contracts.
Financial assets at fair value through other comprehensive income
related securities, partially offset by maturities and sales.
Debt securities at amortized cost, net of allowance for credit losses
investments.
Securities purchased under reverse repurchase agreements
decreased $16 billion
primarily
reflecting lower volumes.
Loans, net of allowance for loan losses
increased $38 billion primarily reflecting volume growth in consumer instalment and business and government loans,
partially offset by a decrease in residential mortgages.
Other assets
decreased $1 billion primarily reflecting a decrease in amounts receivable from brokers, dealers, and clients due to lower volumes of pending trades.
Total liabilities
The increase in total liabilities reflects an increase in financial liabilities designated at FVTPL of $15 billion, obligations related to securities sold under repurchase
agreements of $8 billion, trading deposits of $5 billion, partially offset by decreases in deposits of $6 billion, and derivatives of $4 billion.
Trading deposits
increased $5 billion primarily reflecting new issuances, partially offset by maturities.
Derivative
liabilities
decreased $4 billion primarily reflecting a decrease in mark-to-market values of foreign exchange contracts and commodity contracts, partially
offset by increases in equity contracts and interest rate contracts.
Financial liabilities designated at fair value through profit or loss
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 26
Deposits
decreased $6 billion primarily reflecting lower volumes in business and government deposits and personal deposits, partially offset by higher volumes in
bank deposits.
Obligations related to securities sold under repurchase agreements
increased $8 billion primarily reflecting higher volumes.
Equity
was $127 billion as at July 31, 2026, a decrease of $1 billion from October 31, 2025. The decrease reflects losses in accumulated other comprehensive
income, primarily driven by cash flow hedges. The retained earnings is flat as the net income for the period is offset by the premium on the repurchase of common
shares and dividend distributions.
CREDIT PORTFOLIO QUALITY
Quarterly comparison – Q3 2026 vs. Q3 2025
Gross impaired loans were $5,143 million as at July 31, 2026, a decrease of $191 million, or 4%, compared with the third quarter last year. Canadian Personal and
Commercial Banking gross impaired loans increased $285 million, or 15%, compared with the third quarter last year, primarily reflecting higher impairments in the
consumer lending portfolio. U.S. Banking gross impaired loans increased $3 million, relatively flat compared with the third quarter last year, reflecting the impact of
foreign exchange, partially offset by lower impairments in the consumer and commercial lending portfolios. Wholesale gross impaired loans decreased
$478 million, or 80%, compared with the third quarter last year, as resolutions outpaced formations. Net impaired loans were $3,700 million as at July 31, 2026, an
increase of $28 million, or 1%, compared with the third quarter last year.
The allowance for credit losses of $9,559 million as at July 31, 2026 was comprised of Stage 3 allowance for impaired loans of $1,448 million, Stage 2 allowance
of $4,773 million and Stage 1 allowance of $3,333 million, and the allowance for debt securities of $5 million. The Stage 1 and 2 allowances are for performing
loans and off-balance sheet instruments.
The Stage 3 allowance for loan losses decreased $223 million, or 13%, reflecting a decrease in the Wholesale and Canadian commercial lending portfolios,
partially offset by an increase in the U.S. Banking and Canadian consumer lending portfolios. The Stage 1 and Stage 2 allowance for loan losses increased
$76 million, or 1%, reflecting volume growth, and credit migration largely in the Canadian consumer lending portfolio. The allowance change included a decrease
of $71 million attributable to the retailer program partners’ share of the U.S. strategic cards portfolio.
Forward-looking information, including macroeconomic variables deemed to be predictive of expected credit losses (ECLs) based on the Bank’s experience, is
used to determine ECL scenarios and associated probability weights to determine the probability-weighted ECLs. Each quarter, all base forecast macroeconomic
variables are refreshed, resulting in new upside and downside macroeconomic scenarios. The probability weightings assigned to each ECL scenario are also
reviewed each quarter and updated as required, as part of the Bank’s ECL governance process. As a result of periodic reviews and quarterly updates, the
allowance for credit losses may be revised to reflect updates in loss estimates based on the Bank’s recent loss experience and its forward-looking views. The Bank
periodically reviews the methodology and has performed certain additional quantitative and qualitative portfolio and loan level assessments of significant increase
in credit risk. Refer to Note 3 and Note 6 of the Bank’s third quarter 2026 Interim Consolidated Financial Statements for further details on forward-looking
information.
The probability-weighted allowance for credit losses reflects the Bank’s forward-looking views.
To
the extent that certain anticipated effects cannot be fully
incorporated into quantitative models, management continues to exercise expert credit judgment in determining the amount of ECLs, including for risks related to
elevated uncertainty associated with policy and trade, and such adjustments will be updated as appropriate in future quarters as additional information becomes
available. Refer to Note 6 of the Bank’s third quarter 2026 Interim Consolidated Financial Statements for additional details.
The Bank calculates allowances for ECLs on debt securities measured at amortized cost and FVOCI. The Bank has $368 billion in such debt securities, all of
which are performing (Stage 1 and 2) and none are impaired (Stage 3). The allowance for credit losses was $2 million for debt securities at amortized cost (DSAC)
and $3 million for debt securities at FVOCI, for a total of $5 million, flat, compared with the third quarter last year.
Quarterly comparison – Q3 2026 vs. Q2 2026
Gross impaired loans decreased $138 million, or 3%, compared with the prior quarter, largely reflected in the U.S. Banking, Wholesale Banking and Canadian
commercial portfolios, partially offset by an increase in the Canadian consumer lending portfolio. Impaired loans net of allowance decreased $51 million, or 1%,
compared with the prior quarter.
The allowance for credit losses of $9,559 million as at July 31, 2026 was comprised of Stage 3 allowance for impaired loans of $1,448 million, Stage 2 allowance
of $4,773 million and Stage 1 allowance of $3,333 million, and the allowance for debt securities of $5 million. The Stage 1 and 2 allowances are for performing
loans and off-balance sheet instruments. The Stage 3 allowance for loan losses decreased $87 million, or 6%, compared with the prior quarter, reflecting a lower
pace of impaired provisions relative to resolutions across the business & government lending portfolios. The Stage 1 and Stage 2 allowance for loan losses
increased $192 million, or 2%, compared with the prior quarter, reflecting the impact of foreign exchange, performing credit migration in the Wholesale and
Canadian consumer lending portfolios, and volume growth.
The allowance for debt securities remained flat, compared to the prior quarter.
For further details on loans, impaired loans, allowance for credit losses, and on the Bank’s use of forward-looking information and macroeconomic variables in
determining its allowance for credit losses, refer to Note 6 of the Bank’s third quarter 2026 Interim Consolidated Financial Statements.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 27
TABLE 18: CHANGES IN GROSS IMPAIRED LOANS
1
(millions of Canadian dollars)
For the three months ended
For the nine months ended
July 31
April 30
July 31
July 31
July 31
2026
2026
2025
2026
2025
Personal, Business, and Government Loans
Impaired loans as at beginning of period
$
5,281
$
5,594
$
4,866
$
5,420
$
4,949
Classified as impaired during the period
1,973
2,122
2,433
6,674
6,896
Transferred to performing during the period
(323)
(376)
(331)
(996)
(1,109)
Net repayments
(731)
(582)
(595)
(1,882)
(1,815)
Disposals of loans
–
(125)
(18)
(365)
(65)
Amounts written off
(1,190)
(1,340)
(1,045)
(3,740)
(3,504)
Exchange and other movements
133
(12)
24
32
(18)
Impaired loans as at end of period
$
5,143
$
5,281
$
5,334
$
5,143
$
5,334
1
TABLE 19: ALLOWANCE FOR CREDIT LOSSES
(millions of Canadian dollars, except as noted)
As at
July 31
April 30
July 31
2026
2026
2025
Allowance for loan losses for on-balance sheet loans
Stage 1 allowance for loan losses
$
2,862
$
2,736
$
2,732
Stage 2 allowance for loan losses
4,203
4,153
4,288
Stage 3 allowance for loan losses
1,443
1,530
1,662
Total allowance for loan losses for on-balance sheet loans
1
8,508
8,419
8,682
Allowance for off-balance sheet instruments
Stage 1 allowance for loan losses
471
472
449
Stage 2 allowance for loan losses
570
553
561
Stage 3 allowance for loan losses
5
5
9
Total allowance for off-balance sheet instruments
1,046
1,030
1,019
Allowance for loan losses
9,554
9,449
9,701
Allowance for debt securities
5
5
4
Allowance for credit losses
$
9,559
$
9,454
$
9,705
Impaired loans, net of allowance
2
$
3,700
$
3,751
$
3,672
Net impaired loans as a percentage of net loans
2
0.37
%
0.39
%
0.39
%
Total allowance for credit losses as a percentage of gross loans
0.96
0.97
1.03
Provision for (recovery of) credit losses as a percentage of net average loans
0.37
0.43
0.41
1
2
Real Estate Secured Lending
Retail real estate secured lending includes mortgages and lines of credit to North American consumers to satisfy financing needs including home purchases and
refinancing. While the Bank retains first lien on the majority of properties held as security, there is a small portion of loans with second liens, but most of these are
behind a TD mortgage or home equity line of credit (HELOC) that is in first position. In Canada, credit policies are designed so that the combined exposure of all
uninsured facilities on one property does not exceed 80% of the collateral value at origination. Lending at a higher loan-to-value ratio is permitted by legislation but
requires default insurance. This insurance is contractual coverage for the life of eligible facilities and protects the Bank’s real estate secured lending portfolio
against potential losses caused by borrowers’ default. The Bank may also purchase default insurance on lower loan-to-value ratio loans. The insurance is provided
by either government-backed entities or approved private mortgage insurers. In the U.S., for residential mortgage originations, mortgage insurance is usually
obtained from either government-backed entities or approved private mortgage insurers when the loan-to-value exceeds 80% of the collateral value at origination.
The Bank regularly performs stress tests on its real estate lending portfolio as part of its overall stress testing program. This is done with a view to determine the
extent to which the portfolio would be vulnerable to a severe downturn in economic conditions. The effect of severe changes in house prices, interest rates, and
unemployment levels are among the factors considered when assessing the impact on credit losses and the Bank’s overall profitability. A variety of portfolio
segments, including dwelling type and geographical regions, are examined during the exercise to determine whether specific vulnerabilities exist.
TABLE 20: CANADIAN REAL ESTATE SECURED LENDING
1
(millions of Canadian dollars)
As at
Amortizing
Non-amortizing
Total
Residential
Home equity
Total amortizing real
Home equity
mortgages
lines of credit
estate secured lending
lines of credit
July 31, 2026
Total
$
245,012
$
134,717
$
379,729
$
42,485
$
422,214
October 31, 2025
Total
$
267,469
$
110,829
$
378,298
$
37,098
$
415,396
1
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 28
TABLE 21: REAL ESTATE SECURED LENDING
1,2
(millions of Canadian dollars, except as noted)
As at
Residential mortgages
Home equity lines of credit
Total
Insured
3
Uninsured
Insured
3
Uninsured
Insured
3
Uninsured
July 31, 2026
Canada
Atlantic provinces
$
2,205
0.9
%
$
4,838
2.0
%
$
128
0.1
%
$
3,512
2.0
%
$
2,333
0.5
%
$
8,350
2.0
%
British Columbia
4
7,239
3.0
42,318
17.2
662
0.4
34,962
19.7
7,901
1.9
77,280
18.3
Ontario
4
20,501
8.4
114,191
46.6
2,227
1.2
96,078
54.2
22,728
5.4
210,269
49.8
Prairies
4
14,925
6.1
21,484
8.8
1,209
0.7
19,838
11.2
16,134
3.8
41,322
9.8
Québec
5,121
2.0
12,190
5.0
393
0.2
18,193
10.3
5,514
1.3
30,383
7.2
Total Canada
49,991
20.4
%
195,021
79.6
%
4,619
2.6
%
172,583
97.4
%
54,610
12.9
%
367,604
87.1
%
United States
1,522
46,064
–
12,985
1,522
59,049
Total
$
51,513
$
241,085
$
4,619
$
185,568
$
56,132
$
426,653
October 31, 2025
Canada
Atlantic provinces
$
2,377
0.9
%
$
5,038
1.9
%
$
139
0.1
%
$
2,833
1.9
%
$
2,516
0.6
%
$
7,871
1.9
%
British Columbia
4
7,849
2.9
47,101
17.6
708
0.5
28,551
19.3
8,557
2.1
75,652
18.2
Ontario
4
21,505
8.1
124,702
46.6
2,412
1.6
80,826
54.7
23,917
5.7
205,528
49.5
Prairies
4
16,350
6.1
22,746
8.5
1,320
0.9
15,738
10.6
17,670
4.3
38,484
9.3
Québec
5,933
2.2
13,868
5.2
433
0.3
14,967
10.1
6,366
1.5
28,835
6.9
Total Canada
54,014
20.2
%
213,455
79.8
%
5,012
3.4
%
142,915
96.6
%
59,026
14.2
%
356,370
85.8
%
United States
1,544
46,050
–
12,481
1,544
58,531
Total
$
55,558
$
259,505
$
5,012
$
155,396
$
60,570
$
414,901
1
2
3
caused by borrower default. It is provided by either government-backed entities or other approved private mortgage insurers.
4
The following table provides a summary of the period over which the Bank’s residential mortgages would be fully repaid based on the amount of the most recent
payment received. All figures are calculated based on current customer payment amounts, including voluntary payments larger than the original contractual
amounts and/or other voluntary prepayments. The most recent customer payment amount may exceed the original contractual amount due.
Balances with a remaining amortization longer than 30 years primarily reflect Canadian variable rate mortgages where prior interest rate increases relative to
current customer payment levels have resulted in a longer current amortization period. At renewal, the amortization period for Canadian mortgages reverts to the
remaining contractual amortization, which may require increased payments.
TABLE 22: RESIDENTIAL MORTGAGES BY REMAINING AMORTIZATION
1,2
As at
<=5
>5 – 10
>10 – 15
>15 – 20
>20 – 25
>25 – 30
>30 – 35
>35
years
years
years
years
years
years
years
years
Total
July 31, 2026
Canada
0.8
%
3.1
%
8.9
%
20.3
%
32.0
%
30.8
%
1.0
%
3.1
%
100.0
%
United States
2.4
1.8
3.6
9.8
31.9
49.2
0.8
0.5
100.0
Total
1.1
%
2.9
%
8.0
%
18.5
%
32.0
%
33.8
%
1.0
%
2.7
%
100.0
%
October 31, 2025
Canada
0.8
%
2.9
%
8.3
%
20.0
%
31.9
%
30.2
%
1.2
%
4.7
%
100.0
%
United States
2.6
1.6
3.5
9.0
24.1
57.8
0.8
0.6
100.0
Total
1.1
%
2.7
%
7.5
%
18.3
%
30.8
%
34.5
%
1.1
%
4.0
%
100.0
%
1
2
TABLE 23: UNINSURED AVERAGE LOAN-TO-VALUE – Newly Originated and Newly Acquired
1,2,3
For the three months ended
Residential
Home equity
Residential
Home equity
mortgages
lines of credit
4,5
Total
mortgages
lines of credit
4,5
Total
July 31, 2026
October 31, 2025
Canada
Atlantic provinces
69
%
70
%
70
%
70
%
69
%
69
%
British Columbia
6
69
68
68
66
66
66
Ontario
6
69
69
69
68
67
67
Prairies
6
73
72
72
72
72
72
Québec
69
71
71
69
71
71
Total Canada
70
69
69
68
68
68
United States
71
57
64
68
58
64
Total
70
%
69
%
69
%
68
%
68
%
68
%
1
2
3
4
5
6
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 29
Sovereign Risk
The table below provides a summary of the Bank’s direct credit exposures outside of Canada and the U.S. (Europe excludes United Kingdom).
TABLE 24: Total Net Exposure by Region and Counterparty
(millions of Canadian dollars)
As at
Loans and commitments
1
Derivatives, repos, and securities lending
2
Trading and investment portfolio
3
Total
Corporate
Sovereign
Financial
Total
Corporate
Sovereign
Financial
Total
Corporate
Sovereign
Financial
Total
Exposure
4
July 31, 2026
Region
Europe
$
9,200
$
8
$
5,402
$
14,610
$
4,074
$
1,560
$
9,745
$
15,379
$
735
$
25,311
$
3,018
$
29,064
$
59,053
United Kingdom
7,625
4,090
2,805
14,520
2,719
1,896
12,018
16,633
358
1,274
794
2,426
33,579
Asia
484
25
2,467
2,976
286
1,066
3,966
5,318
166
6,736
1,884
8,786
17,080
Other
5
352
14
730
1,096
956
599
2,262
3,817
84
57
2,849
2,990
7,903
Total
$
17,661
$
4,137
$
11,404
$
33,202
$
8,035
$
5,121
$
27,991
$
41,147
$
1,343
$
33,378
$
8,545
$
43,266
$
117,615
October 31, 2025
Region
Europe
$
8,895
$
8
$
5,019
$
13,922
$
5,331
$
1,359
$
9,647
$
16,337
$
1,116
$
25,876
$
1,982
$
28,974
$
59,233
United Kingdom
6,731
2,577
2,483
11,791
3,199
1,537
12,237
16,973
270
176
661
1,107
29,871
Asia
182
23
2,527
2,732
241
538
3,795
4,574
138
8,346
1,829
10,313
17,619
Other
5
227
–
690
917
705
410
2,353
3,468
110
216
1,967
2,293
6,678
Total
$
16,035
$
2,608
$
10,719
$
29,362
$
9,476
$
3,844
$
28,032
$
41,352
$
1,634
$
34,614
$
6,439
$
42,687
$
113,401
1
2
Association master netting agreement.
3
4
5
CAPITAL POSITION
REGULATORY CAPITAL
Capital requirements established by the Basel Committee on Banking Supervision (BCBS) are commonly referred to as Basel III. Under Basel III, Total Capital
consists of three components, namely CET1, Additional Tier 1, and Tier 2 Capital. Risk sensitive regulatory capital ratios are calculated by dividing CET1, Tier 1,
and Total Capital by risk-weighted assets (RWA), inclusive of any minimum requirements outlined under the regulatory floor. Basel III also introduced a non-risk
sensitive leverage ratio to act as a supplementary measure to the risk-sensitive capital requirements. The leverage ratio is calculated by dividing Tier 1 Capital by
leverage exposure which is primarily comprised of on-balance sheet assets with adjustments made to derivative and securities financing transaction exposures,
and credit equivalent amounts of off-balance sheet exposures. TD manages its regulatory capital in accordance with OSFI’s implementation of the Basel III Capital
Framework.
OSFI’s Capital Requirements under Basel III
OSFI’s CAR and LR guidelines detail how the Basel III capital rules apply to Canadian banks.
The Domestic Stability Buffer (DSB) level decreased from 3.5% to 3.0% as of June 19, 2026. The DSB range was also updated, and can now range from 0% to
3%, with the effective level adjusted by OSFI in response to developments in Canada’s financial system and the broader economy.
OSFI has implemented the Basel III reforms with adjustments to make them suitable for domestic implementation. The Basel III reforms impact the calculation of
credit risk, market risk and operational risk for Canadian banks.
On November 1, 2023, the standardized capital floor transitioned to 67.5% of RWA from the previous 65% of RWA. OSFI has stated that the floor will remain at
67.5% until further notice.
The Bank has implemented OSFI’s Parental Stand-Alone (Solo) Total Loss Absorbing Capacity (TLAC) Framework for D-SIBs, which establishes a risk-based
measure intended to ensure that a non-viable D-SIB has sufficient loss absorbing capacity on a stand-alone, legal entity basis to support its resolution. The Bank is
compliant with the requirements set out in this framework.
The table below summarizes OSFI’s published regulatory minimum capital targets as at July 31, 2026.
REGULATORY CAPITAL AND TLAC TARGET RATIOS
Capital
Pillar 1
Pillar 1 & 2
Conservation
D-SIB / G-SIB
Regulatory
Regulatory
Minimum
Buffer
Surcharge
1
Target
2
DSB
Target
CET1
4.5
%
2.5
%
1.0
%
8.0
%
3.0
%
11.0
%
Tier 1
6.0
2.5
1.0
9.5
3.0
12.5
Total Capital
8.0
2.5
1.0
11.5
3.0
14.5
Leverage
3.0
n/a
3
0.5
3.5
n/a
3.5
TLAC
18.0
2.5
1.0
21.5
3.0
24.5
TLAC Leverage
6.75
n/a
0.50
7.25
n/a
7.25
1
requirement for risk-weighted capital ratios. The G-SIB surcharge may increase above 1%, to a maximum of 4%, if the Bank’s G-SIB score increases above certain thresholds. OSFI’s LR
Guideline includes a requirement for D-SIBs to hold a leverage ratio buffer set at 50% of a D-SIB’s higher loss absorbency risk-weighted requirements, effectively 0.50%. This buffer also
applies to the TLAC Leverage ratio.
2
3
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 30
The following table provides details of the Bank’s regulatory capital position.
TABLE 25: CAPITAL STRUCTURE AND RATIOS – Basel III
(millions of Canadian dollars, except as noted)
As at
July 31
October 31
July 31
2026
2025
2025
Common Equity Tier 1 Capital
Common shares plus related contributed surplus
$
24,529
$
25,010
$
25,122
Retained earnings
78,882
78,320
78,749
Accumulated other comprehensive income
10,771
12,874
10,737
Common Equity Tier 1 Capital before regulatory adjustments
114,182
116,204
114,608
Common Equity Tier 1 Capital regulatory adjustments
Prudential valuation adjustments
(195)
(165)
(160)
Goodwill (net of related tax liability)
(18,747)
(18,753)
(18,557)
Intangibles (net of related tax liability)
(3,757)
(3,316)
(3,197)
Deferred tax assets excluding those arising from temporary differences
(273)
(202)
(413)
Cash flow hedge reserve
2,913
867
1,990
Shortfall of provisions to expected losses
–
–
–
Gains and losses due to changes in own credit risk on fair valued liabilities
(152)
(166)
(188)
Defined benefit pension fund net assets (net of related tax liability)
(767)
(811)
(756)
Investment in own shares
(8)
(9)
(124)
Non-significant investments in the capital of banking, financial, and insurance entities, net of eligible
short positions (amount above 10% threshold)
–
–
–
Significant investments in the common stock of banking, financial, and insurance entities
that are outside the scope of regulatory consolidation, net of eligible short positions
(amount above 10% threshold)
–
–
–
Equity investments in funds subject to the fall-back approach
(33)
(90)
(102)
Crypto-asset deduction
(1)
–
–
Other deductions or regulatory adjustments to CET1 as determined by OSFI
24
20
19
Total regulatory adjustments to Common Equity Tier 1 Capital
(20,996)
(22,625)
(21,488)
Common Equity Tier 1 Capital
93,186
93,579
93,120
Additional Tier 1 Capital instruments
Directly issued qualifying Additional Tier 1 instruments plus stock surplus
12,833
11,623
10,786
Additional Tier 1 Capital instruments before regulatory adjustments
12,833
11,623
10,786
Additional Tier 1 Capital instruments regulatory adjustments
Non-significant investments in the capital of banking, financial, and insurance entities, net of eligible
short positions (amount above 10% threshold)
–
–
–
Significant investments in the capital of banking, financial, and insurance entities that are outside
the scope of regulatory consolidation, net of eligible short positions
(700)
(700)
(700)
Total regulatory adjustments to Additional Tier 1 Capital
(700)
(700)
(700)
Additional Tier 1 Capital
12,133
10,923
10,086
Tier 1 Capital
105,319
104,502
103,206
Tier 2 Capital instruments and provisions
Directly issued qualifying Tier 2 instruments plus related stock surplus
10,523
10,733
10,496
Collective allowances
1,258
1,661
1,745
Tier 2 Capital before regulatory adjustments
11,781
12,394
12,241
Tier 2 regulatory adjustments
Investments in own Tier 2 instruments
–
–
–
Non-significant investments in the capital of banking, financial, and insurance entities, net of eligible
short positions (amount above 10% threshold)
1
–
–
–
Non-significant investments in the other TLAC-eligible instruments issued by G-SIBs and Canadian
D-SIBs, where the institution does not own more than 10% of the issued common share capital
of the entity: amount previously designated for the 5% threshold but that no longer meets the
conditions
(118)
(30)
(2)
Significant investments in the capital of banking, financial, and insurance entities that are outside
the scope of regulatory consolidation, net of eligible short positions
–
–
–
Total regulatory adjustments to Tier 2 Capital
(118)
(30)
(2)
Tier 2 Capital
11,663
12,364
12,239
Total Capital
$
116,982
$
116,866
$
115,445
Risk-weighted assets
$
653,368
$
636,424
$
627,248
Capital Ratios and Multiples
Common Equity Tier 1 Capital (as percentage of risk-weighted assets)
14.3
%
14.7
%
14.8
%
Tier 1 Capital (as percentage of risk-weighted assets)
16.1
16.4
16.5
Total Capital (as percentage of risk-weighted assets)
17.9
18.4
18.4
Leverage ratio
2
4.5
4.6
4.6
1
10% of the issued common share capital of the entity.
2
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 31
As at July 31, 2026, the Bank’s CET1, Tier 1, and Total Capital ratios were 14.3%, 16.1%, and 17.9%, respectively. The decrease in the Bank’s CET1 Capital ratio
from 14.7% as at October 31, 2025 was primarily driven by common shares repurchased for cancellation and growth in RWA, partially offset by earnings net of
dividends and credit risk model updates. The Bank expects to reach a CET1 ratio of approximately 13% by October 31, 2027
As at July 31, 2026, the Bank’s leverage ratio was 4.5%. Compared with the Bank’s leverage ratio of 4.6% as at October 31, 2025, the decrease was primarily
attributable to common shares repurchased for cancellation and balance sheet growth, partially offset by earnings net of dividends.
Future Regulatory Capital Developments
Future regulatory capital developments were described in the “Future Regulatory Capital Developments” section of the Bank’s 2025 MD&A.
TABLE 26: EQUITY AND OTHER SECURITIES
1
(thousands of shares/units and millions of Canadian dollars, except as noted)
As at
July 31, 2026
October 31, 2025
Number of
Number of
shares/units
Amount
shares/units
Amount
Common shares
Common shares outstanding
1,638,511
$
24,149
1,689,496
$
24,727
Treasury – common shares
(114)
(19)
–
–
Total common shares
1,638,397
$
24,130
1,689,496
$
24,727
Stock options
Vested
5,171
5,160
Non-vested
8,298
9,027
Preferred shares – Class A
2
Series 1
20,000
$
500
20,000
$
500
Series 16
14,000
350
14,000
350
Series 18
14,000
350
14,000
350
Series 27
850
850
850
850
Series 28
800
800
800
800
49,650
$
2,850
49,650
$
2,850
Other equity instruments
2,3,4
Limited Recourse Capital Notes – Series 1
1,750
1,750
1,750
1,750
Limited Recourse Capital Notes – Series 2
1,500
1,500
1,500
1,500
Limited Recourse Capital Notes – Series 3
5
1,750
2,403
1,750
2,403
Limited Recourse Capital Notes – Series 4
5
750
1,023
750
1,023
Limited Recourse Capital Notes – Series 5
750
750
750
750
Limited Recourse Capital Notes – Series 6
5
750
1,037
750
1,037
Limited Recourse Capital Notes – Series 7
6
1,250
1,250
–
–
Perpetual Subordinated Capital Notes – Series 2023-9
7
1
312
1
312
58,151
$
12,875
56,901
$
11,625
Treasury – preferred shares and other equity instruments
(101)
(46)
(29)
(4)
Total preferred shares and other equity instruments
58,050
$
12,829
56,872
$
11,621
1
Statements.
2
3
4
(LRCN Preferred Shares), Series 26 and 29 through 34, respectively. The LRCN Preferred Shares are eliminated on the Bank's Consolidated Financial Statements.
5
6
7
DIVIDENDS
On August 26, 2026, the Board approved a dividend in an amount of one dollar and twelve cents ($1.12) per fully paid common share in the capital stock of the
Bank for the quarter ending October 31, 2026, payable on and after October 31, 2026, to shareholders of record at the close of business on October 9, 2026. The
Bank has a semi-annual dividend review cycle to support the alignment of shareholder return with earnings growth.
DIVIDEND REINVESTMENT PLAN
The Bank offers a Dividend Reinvestment Plan (DRIP) for its common shareholders. Participation in the plan is optional and under the terms of the plan, cash
dividends on common shares are used to purchase additional common shares. At the option of the Bank, the common shares may be issued from treasury at an
average market price based on the last five trading days before the date of the dividend payment, with a discount of between 0% to 5% at the Bank’s discretion or
purchased from the open market at market prices.
During the three and nine months ended July 31, 2026, the Bank satisfied the DRIP requirements through open market common share purchases. During the
three months ended July 31, 2025, the Bank satisfied the DRIP requirements through open market common share purchases. During the nine months ended
July 31, 2025, the Bank satisfied the DRIP requirements through common shares issued from treasury with no discount for the first three months and open market
common share purchases in the last six months.
NORMAL COURSE ISSUER BID
On February 24, 2025, the Bank announced that the Toronto Stock Exchange (TSX) and OSFI had approved a normal course issuer bid (2025 NCIB) to purchase
for cancellation up to 100 million of its common shares for up to $8 billion. The Bank completed its 2025 NCIB in January 2026, under which it repurchased and
cancelled $8 billion of its common shares.
15
The Bank’s expectations for financial targets are based on forward-looking assumptions that have inherent risk and uncertainties. Results may vary depending on actual economic conditions, including
the level of unemployment, interest rates, and economic growth or contraction, the operating environment, including regulatory requirements, political environment, and competitive landscape, and the
Bank’s assumptions on future business performance, including credit conditions and performance, inclusive of policy and trade uncertainty and borrower or industry specific credit factors and
conditions, and foreign exchange impact. These assumptions are subject to inherent uncertainties and may vary based on factors outside the Bank’s control, including those set out at the beginning of
this document in the “Caution Regarding Forward-Looking Statements” section. Refer to the “Risk Factors That May Affect Future Results” section of the Bank’s 2025 MD&A for additional information
about risks and uncertainties that may impact the Bank’s estimates.
16
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 32
On January 16, 2026, the Bank announced that the TSX and OSFI have approved the Bank’s new normal course issuer bid (2026 NCIB) to repurchase for
cancellation up to $7 billion of its common shares, not to exceed 61 million common shares. The 2026 NCIB commenced on January 20, 2026, and will terminate
on (A) the earliest to occur of: (i) January 15, 2027; (ii) the date on which the aggregate purchase cost of common shares purchased equals $7 billion; and (iii) the
date on which the maximum number of common shares purchasable is reached; or (B) such earlier date as the Bank may determine. From the commencement of
the 2026 NCIB on January 20, 2026, to July 31, 2026, the Bank repurchased 37.7 million shares under the program, at an average price of $143.31 per share for a
total amount of $5.4 billion. During the three months ended July 31, 2026, the Bank repurchased and cancelled approximately 14.5 million shares under the 2026
NCIB program, for a total of $2.4 billion.
NON-VIABILITY CONTINGENT CAPITAL PROVISION
If an NVCC trigger event were to occur, for all series of Class A First Preferred Shares excluding the preferred shares issued with respect to LRCNs, the maximum
number of common shares that could be issued, assuming there are no declared and unpaid dividends on the respective series of preferred shares at the time of
conversion, would be 0.6 billion in aggregate.
The LRCNs, by virtue of the recourse to the preferred shares held in the Limited Recourse Trust, include NVCC provisions. For LRCNs, if an NVCC trigger were
to occur, the maximum number of common shares that could be issued, assuming there are no declared and unpaid dividends on the preferred shares series
issued in connection with such LRCNs, would be 2.0 billion in aggregate.
For NVCC subordinated notes and debentures (including Additional Tier 1 Perpetual Notes), if an NVCC trigger event were to occur, the maximum number of
common shares that could be issued, assuming there is no accrued and unpaid interest on the respective subordinated notes and debentures, would be 3.2 billion
in aggregate.
RISK FACTORS AND MANAGEMENT
Risk Factors That May Affect Future Results
In addition to the risks described in the “Managing Risk” section of the Bank’s 2025 MD&A and this Report, there are numerous other risk factors, many of which
are beyond the Bank’s control and the effects of which can be difficult to predict, that could cause the Bank’s results to differ significantly from the Bank’s plans,
objectives, and estimates or could impact the Bank’s reputation or the sustainability of its business model. All forward-looking statements, including those in this
MD&A, are, by their very nature, subject to inherent risks and uncertainties, general and specific, which may cause the Bank’s actual results to differ materially
from the plan, objectives, estimates or expectations expressed in the forward-looking statements. Some of these factors are discussed in the “Risk Factors and
Management” section of the 2025 MD&A and in the “Managing Risk” section of this document, and others are noted in the “Caution Regarding Forward-Looking
Statements” section of this document. The Bank has supplemented the following Risk Factors to reflect developments in the external environment.
Geopolitical Risk
Further to the geopolitical risks outlined in the Bank's 2025 MD&A, geopolitical risk remains elevated, driven by heightened trade tensions and ongoing geopolitical
conflicts that continue to create uncertainty, increase market volatility, and disrupt global supply chains and trade flows. The U.S. decision not to extend the
Canada-United States-Mexico Agreement (CUSMA) has increased uncertainty surrounding the future of Canada's trade relationships. Prolonged negotiations,
significant restructuring or termination of CUSMA, and the resulting uncertainty regarding the scope and level of tariffs, could adversely affect cross-border trade
and investment activities, diminish consumer and business confidence, and place additional pressure on export-dependent sectors, resulting in higher provisions
for credit losses, slower loan growth and increased market volatility. In the Middle East, the risk of a prolonged military conflict and navigation blockades remains
active, and may generate further energy supply disruptions, increase commodity price volatility, and amplify broader macroeconomic uncertainty, which could have
an impact on the Bank and its customers.
MANAGING RISK
EXECUTIVE SUMMARY
Growing profitability in financial results based on balanced revenue, expense and capital growth services involves selectively taking and managing risks within the
Bank’s risk appetite. The Bank’s goal is to earn a stable and sustainable rate of return for every dollar of risk it takes, while putting significant emphasis on
investing in its businesses to meet its future strategic objectives.
The Bank’s businesses and operations are exposed to a broad number of risks that have been identified and defined in the Enterprise Risk Framework. The
Bank’s tolerance to those risks is defined in the Enterprise Risk Appetite which has been developed within a comprehensive framework that takes into
consideration current conditions in which the Bank operates and the impact that emerging risks will have on TD’s strategy and risk profile. The Bank’s risk appetite
states that it takes risks required to build its business, but only if those risks: (1) fit the business strategy and can be understood and managed; (2) do not expose
the enterprise to any significant single loss events; TD does not ‘bet the bank’ on any single acquisition, business, product or decision; and (3) do not risk harming
the TD brand. Each business is responsible for setting and aligning its individual risk appetites with that of the enterprise based on a thorough examination of the
specific risks to which it is exposed.
The Bank considers it critical to regularly assess its operating environment and highlight top and emerging risks. These are risks with a potential to have a
material effect on the Bank and where the attention of senior leaders is focused due to the potential magnitude or immediacy of their impact.
Risks are identified, discussed, and actioned by senior leaders and reported quarterly to the Risk Committee. Specific plans to mitigate top and emerging risks
are prepared, monitored, and adjusted as required.
The Bank’s risk governance structure and risk management approach have not substantially changed from that described in the Bank’s 2025 MD&A. Additional
information on risk factors can be found in this document and the 2025 MD&A under the heading “Risk Factors and Management”. For a complete discussion of
the risk governance structure and the risk management approach, refer to the “Managing Risk” section in the Bank’s 2025 MD&A.
The shaded sections of this MD&A represent a discussion relating to market and liquidity risks and form an integral part of the Interim Consolidated Financial
Statements for the period ended July 31, 2026.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 33
CREDIT RISK
Gross credit risk exposure, also referred to as exposure at default (EAD), is the total amount the Bank is exposed to at the time of default of a loan and is
measured before counterparty-specific provisions or write-offs. Gross credit risk exposure does not reflect the effects of credit risk mitigation (CRM) and includes
both on-balance sheet and off-balance sheet exposures. On-balance sheet exposures consist primarily of outstanding loans, non-trading securities, derivatives,
and certain other repo-style transactions. Off-balance sheet exposures consist primarily of undrawn commitments, guarantees, and certain other repo-style
transactions.
Gross credit risk exposures for the two approaches the Bank uses to measure credit risk are included in the following table.
TABLE 27: GROSS CREDIT RISK EXPOSURE – Standardized and Internal Ratings-Based (IRB) Approaches
1
(millions of Canadian dollars)
As at
July 31, 2026
October 31, 2025
Standardized
IRB
Total
Standardized
IRB
Total
Retail
Residential secured
$
5,159
$
560,802
$
565,961
$
5,141
$
552,249
$
557,390
Qualifying revolving retail
852
179,622
180,474
871
177,970
178,841
Other retail
3,689
114,461
118,150
3,660
110,316
113,976
Total retail
9,700
854,885
864,585
9,672
840,535
850,207
Non-retail
Corporate
1,026
876,363
877,389
2,402
758,573
760,975
Sovereign
125
481,555
481,680
175
552,954
553,129
Bank
835
209,219
210,054
7,121
180,614
187,735
Total non-retail
1,986
1,567,137
1,569,123
9,698
1,492,141
1,501,839
Gross credit risk exposures
$
11,686
$
2,422,022
$
2,433,708
$
19,370
$
2,332,676
$
2,352,046
1
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 34
MARKET RISK
Market risk capital is calculated using the Standardized Approach under Basel III. The Bank continues to use Value-at-Risk (VaR) as an internal management
metric to monitor and control market risk.
Market Risk Linkage to the Balance Sheet
The following table provides a breakdown of the Bank’s balance sheet assets and liabilities exposed to trading and non-trading market risks. Market risk of assets
and liabilities included in the calculation of VaR and metrics used for regulatory market risk capital purposes is classified as trading market risk.
TABLE 28: MARKET RISK LINKAGE TO THE BALANCE SHEET
(millions of Canadian dollars)
As at
July 31, 2026
October 31, 2025
Non-trading market
Balance
Trading
Non-trading
Balance
Trading
Non-trading
risk – primary risk
sheet
market risk
market risk
Other
sheet
market risk
market risk
Other
sensitivity
Assets subject to market risk
Interest-bearing deposits with banks
$
103,820
$
2,781
$
101,039
$
–
$
109,417
$
940
$
108,477
$
–
Interest rate
Trading loans, securities, and other
218,133
212,175
5,958
–
220,136
213,151
6,985
–
Interest rate
Non-trading financial assets at
fair value through profit or loss
9,534
–
9,534
–
7,395
–
7,395
–
Equity,
foreign exchange,
interest rate
Derivatives
80,055
70,825
9,230
–
82,972
72,906
10,066
–
Equity,
foreign exchange,
interest rate
Financial assets designated at
fair value through profit or loss
7,071
–
7,071
–
6,986
–
6,986
–
Interest rate
Financial assets at fair value through
other comprehensive income
135,092
–
135,092
–
126,369
–
126,369
–
Equity,
foreign exchange,
interest rate
Debt securities at amortized cost,
net of allowance for credit losses
236,855
–
236,855
–
240,439
–
240,439
–
Foreign exchange,
interest rate
Securities purchased under
reverse repurchase agreements
231,368
146,167
85,201
–
247,078
7,574
239,504
–
Interest rate
Loans, net of allowance for
loan losses
991,036
–
991,036
–
953,012
–
953,012
–
Interest rate
Other assets
1
2,078
–
2,078
–
2,047
–
2,047
–
Interest rate
Assets not exposed to
96,819
–
–
96,819
98,707
–
–
98,707
Total Assets
$
2,111,861
$
431,948
$
1,583,094
$
96,819
$
2,094,558
$
294,571
$
1,701,280
$
98,707
Liabilities subject to market risk
Trading deposits
$
43,486
$
32,701
$
10,785
$
–
$
37,882
$
28,955
$
8,927
$
–
Equity, interest rate
Derivatives
75,308
70,491
4,817
–
79,356
74,790
4,566
–
Equity,
foreign exchange,
interest rate
Securitization liabilities at fair value
26,491
26,491
–
–
25,283
25,283
–
–
Interest rate
Financial liabilities designated at
fair value through profit or loss
213,022
8
213,014
–
197,635
3
197,632
–
Interest rate
Deposits
1,260,724
–
1,260,724
–
1,267,104
–
1,267,104
–
Interest rate,
foreign exchange
Obligations related to securities
sold short
41,924
38,356
3,568
–
43,795
42,475
1,320
–
Interest rate
Obligations related to securities sold
under repurchase agreements
228,932
183,821
45,111
–
221,150
13,922
207,228
–
Interest rate
Securitization liabilities at amortized
cost
16,990
–
16,990
–
14,841
–
14,841
–
Interest rate
Subordinated notes and debentures
10,523
–
10,523
–
10,733
–
10,733
–
Interest rate
Other liabilities
1
16,971
–
16,971
–
16,934
–
16,934
–
Equity, interest rate
Liabilities and Equity not
exposed to market risk
177,490
–
–
177,490
179,845
–
–
179,845
Total Liabilities and Equity
$
2,111,861
$
351,868
$
1,582,503
$
177,490
$
2,094,558
$
185,428
$
1,729,285
$
179,845
1
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 35
-75
-65
-55
-45
-35
-25
-15
-5
5
15
25
35
45
55
65
75
5/1/2026
5/8/2026
5/15/2026
5/22/2026
5/29/2026
6/5/2026
6/12/2026
6/19/2026
6/26/2026
7/3/2026
7/10/2026
7/17/2026
7/24/2026
7/31/2026
TOTAL VALUE-AT-RISK AND TRADING NET REVENUE
(millions of Canadian dollars)
Calculating VaR
The Bank computes total VaR on a daily basis by combining the General Market Risk (GMR) and Idiosyncratic Debt Specific Risk (IDSR) associated with the
Bank’s trading positions.
GMR is determined by creating a distribution of potential changes in the market value of the current portfolio using historical simulation. The Bank values the
current portfolio using the market price and rate changes of the most recent
products. GMR is computed as the threshold level that portfolio losses are not expected to exceed more than
one
one-day
period is used for GMR calculation.
IDSR measures idiosyncratic (single-name) credit spread risk for credit exposures in the trading portfolio using Monte Carlo simulation. The IDSR model is
based on the historical behaviour of five-year idiosyncratic credit spreads. Similar to GMR, IDSR is computed as the threshold level that portfolio losses are not
expected to exceed more than
one
ten-day
The following graph discloses daily
one-day
trading income and net interest income related to positions within the Bank’s market risk capital trading books. For the third quarter ending July 31, 2026, there
were
% of the trading days, reflecting normal trading activity. Losses in the quarter did not
exceed VaR on any trading day.
VaR is a valuable risk measure but it should be used in the context of its limitations, for example:
●
●
●
The Bank continuously improves its VaR methodologies and incorporates new risk measures in line with market conventions, industry best practices, and
regulatory requirements.
To mitigate some of the shortcomings of VaR, the Bank uses additional metrics designed for risk management purposes. This includes stress testing as well as
sensitivities to various market risk factors.
The following table presents the end of quarter, average, high, and low usage of TD’s VaR metric.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 36
TABLE 29: PORTFOLIO MARKET RISK MEASURES
(millions of Canadian dollars)
For the three months ended
For the nine months ended
July 31
April 30
July 31
July 31
July 31
2026
2026
2025
2026
2025
As at
Average
High
Low
Average
Average
Average
Average
Interest rate risk
$
$
$
$
$
$
$
$
Credit spread risk
Equity risk
Foreign exchange risk
Commodity risk
Idiosyncratic debt specific risk
Diversification effect
1
(57.3 )
(71.5 )
2
(69.1 )
(57.2 )
(66.5 )
(52.0 )
Total Value -at-Risk (one-day)
$
$
$
$
$
$
$
$
1
The aggregate VaR is less than the sum of the VaR of the different risk types due to risk offsets resulting from portfolio diversification.
2
Average VaR decreased quarter-over-quarter, primarily driven by commodities due to continued enhancements to the methodology, partially offset by changes in
equity positions.
Validation of VaR Model
The Bank uses a back-testing process to compare actual profits and losses to VaR to review their consistency with the statistical results of the VaR model.
Non-Trading Interest Rate Risk
The Bank’s non-trading interest rate risk arises mainly from traditional personal and commercial banking activity and is generally the result of mismatches between
the maturities and repricing dates of the Bank’s assets and liabilities.
The primary measures for managing and controlling this risk are Economic Value of Shareholders’ Equity (EVE) Sensitivity and Net Interest Income Sensitivity
(NIIS).
The EVE Sensitivity measures the change in the net present value of the Bank’s banking book assets, liabilities, and certain off-balance sheet items given a
specific interest rate shock. It reflects a measurement of the potential present value impact on shareholders’ equity without an assumed term profile for the
management of the Bank’s own equity and excludes product margins.
The NIIS measures the NII change over a twelve-month horizon for a specified change in interest rates for banking book assets, liabilities, and certain off-
balance sheet items assuming a constant balance sheet over the period.
The Bank’s Market Risk policy sets overall limits on the non-trading interest rate risk measures. These limits are periodically reviewed and approved by the Risk
Committee. In addition to the Board policy limits, book-level risk limits are set for the Bank’s management of non-trading interest rate risk by Risk Management.
Exposures against these limits are routinely monitored and reported, and breaches of the Board limits, if any, are escalated to both the Asset Liability and Capital
Committee (ALCO) and the Risk Committee.
The following table shows the potential before-tax impact of an immediate and sustained 100 bps increase or decrease in interest rates on the EVE and NIIS
measures.
TABLE 30: NON-TRADING INTEREST RATE SENSITIVITY MEASURES
(millions of Canadian dollars)
As at
July 31, 2026
April 30, 2026
July 31, 2025
EVE
NII
EVE
NII
EVE
NII
Sensitivity
Sensitivity
1
Sensitivity
Sensitivity
1
Sensitivity
3
Sensitivity
1,3
Canadian
U.S.
Total
Canadian
U.S.
Total
Total
Total
Total
Total
dollar
2
dollar
dollar
2
dollar
Before-tax impact of
$
(1,444 )
$
(2,362 )
$
(3,806 )
$
$
$
$
(3,683 )
$
$
(3,330 )
$
(323 )
(48 )
(371 )
(461 )
(609 )
1
Represents the twelve-month NII exposure to an immediate and sustained shock in rates, and may include adjustments for non-recurring items.
2
3
As at July 31, 2026, an immediate and sustained 100 bps increase in interest rates would have a negative impact to the Bank’s EVE of $
of $
100 bps decrease in interest rates would have a positive impact to the Bank’s EVE of $
impact to the Bank’s NII of $
associated with Treasury hedging activity.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 37
Liquidity Risk
The risk of having insufficient cash or collateral to meet financial obligations and an inability to, in a timely manner, raise funding or monetize assets at a non-
distressed price. Financial obligations can arise from deposit withdrawals, debt maturities, commitments to provide credit or liquidity support or the need to pledge
additional collateral.
TD’S LIQUIDITY RISK APPETITE
TD follows a disciplined liquidity management program, which is subject to risk governance and oversight, and is designed to maintain sufficient liquidity to permit
the Bank to operate through a significant liquidity event without relying on extraordinary central bank assistance. The Bank maintains access to a stable and
diversified funding base and aligns its funding profile with that of the assets and contingent obligations it supports.
WHO MANAGES LIQUIDITY RISK
The Risk Committee, the ALCO and the Treasurer are accountable for the identification, assessment, control, monitoring and oversight of liquidity risk.
●
policies annually.
●
governance of liquidity risk.
●
Management, identifies and monitors the Bank’s liquidity risks.
In addition to our committee oversight framework, liquidity risk management activities are subject to the three lines of defence governance model. Treasury, the
first line of defence for the management of liquidity risk, is subject to independent second line challenge and oversight by Risk Management. TD’s Internal Audit is
the third line of defence. The three lines of defence are independent of the business whose activities generate liquidity risks.
The Bank’s liquidity risk appetite and liquidity risk management approach have not changed substantially from that described in the Bank’s 2025 MD&A. For a
complete discussion of liquidity risk, refer to the “Liquidity Risk” section in the Bank’s 2025 MD&A.
Liquid assets
The Bank’s unencumbered liquid assets could be used to help address potential funding needs arising from stress events. Liquid asset eligibility considers
estimated stressed market values and trading market depth, as well as operational, legal, or other impediments to sale, rehypothecation or pledging.
Assets held by the Bank to meet liquidity requirements are summarized in the following tables. The tables do not include assets held within the Bank’s insurance
businesses as these are used to support insurance-specific liabilities and capital requirements.
TABLE 31: SUMMARY OF LIQUID ASSETS BY TYPE AND CURRENCY
(millions of Canadian dollars, except as noted)
As at
Securities
received as
collateral from
securities
financing and
Bank-owned
derivative
Total
Encumbered
Unencumbered
liquid assets
transactions
liquid assets
liquid assets
liquid assets
1
July 31, 2026
Cash and central bank reserves
$
$
$
$
$
Obligations of government, federal agencies, public sector entities,
and multilateral development banks
2
Equities
Other debt securities
Other securities
Total Canadian dollar-denominated
Cash and central bank reserves
Obligations of government, federal agencies, public sector entities,
and multilateral development banks
Equities
Other debt securities
Other securities
Total non-Canadian dollar-denominated
Total
3
$
$
$
$
$
October 31, 2025
Total Canadian dollar -denominated
$
$
$
$
$
Total non-Canadian dollar-denominated
Total
$
$
$
$
$
1
Unencumbered liquid assets include on-balance sheet assets, assets borrowed or purchased under resale agreements, and other off-balance sheet collateral received less encumbered
liquid assets.
2
3
.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 38
Unencumbered liquid assets held in The Toronto-Dominion Bank, its domestic and foreign subsidiaries, and branches are summarized in the following table.
TABLE 32: SUMMARY OF UNENCUMBERED LIQUID ASSETS BY BANK, SUBSIDIARIES, AND BRANCHES
(millions of Canadian dollars)
As at
July 31
October 31
2026
2025
The Toronto-Dominion Bank (Parent)
$
$
Bank subsidiaries
Foreign branches
Total
$
$
The Bank’s average liquid assets are summarized in the following table.
TABLE 33: SUMMARY OF AVERAGE LIQUID ASSETS BY TYPE AND CURRENCY
(millions of Canadian dollars, except as noted)
Average for the three months ended
Securities
received as
collateral from
securities
financing and
Total
Bank-owned
derivative
liquid
Encumbered
Unencumbered
liquid assets
transactions
assets
liquid assets
liquid assets
1
July 31, 2026
Cash and central bank reserves
$
16,039
$
–
$
16,039
$
2,197
$
13,842
Obligations of government, federal agencies, public sector
entities, and multilateral development banks
2
108,331
105,996
214,327
110,266
104,061
Equities
20,229
9,143
29,372
22,100
7,272
Other debt securities
7,655
24,636
32,291
12,373
19,918
Other securities
–
–
–
–
–
Total Canadian dollar-denominated
152,254
139,775
292,029
146,936
145,093
Cash and central bank reserves
82,761
–
82,761
–
82,761
Obligations of government, federal agencies, public sector
entities, and multilateral development banks
221,745
162,503
384,248
171,412
212,836
Equities
74,982
84,160
159,142
88,452
70,690
Other debt securities
88,988
44,881
133,869
38,912
94,957
Other securities
22,900
2,363
25,263
7,688
17,575
Total non-Canadian dollar-denominated
491,376
293,907
785,283
306,464
478,819
Total
$
643,630
$
433,682
$
1,077,312
$
453,400
$
623,912
April 30, 2026
Total Canadian dollar -denominated
$
155,977
$
132,662
$
288,639
$
133,161
$
155,478
Total non-Canadian dollar-denominated
484,788
270,292
755,080
305,621
449,459
Total
$
640,765
$
402,954
$
1,043,719
$
438,782
$
604,937
1
liquid assets.
2
Average unencumbered liquid assets held in The Toronto-Dominion Bank, its domestic and foreign subsidiaries, and branches are summarized in the following
table.
TABLE 34: SUMMARY OF AVERAGE UNENCUMBERED LIQUID ASSETS BY BANK, SUBSIDIARIES, AND BRANCHES
(millions of Canadian dollars)
Average for the three months ended
July 31
April 30
2026
2026
The Toronto-Dominion Bank (Parent)
$
235,960
$
237,056
Bank subsidiaries
354,496
338,412
Foreign branches
33,456
29,469
Total
$
623,912
$
604,937
ASSET ENCUMBRANCE
In the course of the Bank’s daily operations, assets are pledged to obtain funding, support trading and brokerage businesses, and participate in clearing and/or
settlement systems. TD has pledging policies in place that govern the amount of assets we encumber, ensuring sufficient assets are available to meet liquidity
requirements. A summary of on- and off-balance sheet encumbered and unencumbered assets is presented as follows.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 39
TABLE 35: ENCUMBERED AND UNENCUMBERED ASSETS
(millions of Canadian dollars)
As at
Total Assets
Encumbered
Unencumbered
Total
Pledged as
Available as
Assets
Collateral
1
Other
2
Collateral
3
Other
4
July 31, 2026
Cash and due from banks
$
6,812
$
–
$
–
$
–
$
6,812
Interest-bearing deposits with banks
103,820
6,741
–
91,603
5,476
Securities, trading loans, and other
1,102,857
513,714
27,114
500,128
61,901
Derivatives
80,055
–
–
–
80,055
Loans, net of allowance for loan losses
960,730
55,211
96,543
54,072
754,904
Other assets
5
92,085
230
–
–
91,855
Total assets
$
2,346,359
$
575,896
$
123,657
$
645,803
$
1,001,003
October 31, 2025
Total assets
$
2,265,385
$
525,387
$
127,282
$
672,337
$
940,379
1
requirements associated with participation in clearing houses and payment systems.
2
3
that qualify as eligible collateral in the Federal Home Loan Bank System.
4
5
dealers, and clients, and other assets on the balance sheet not reported in the above categories.
LIQUIDITY STRESS TESTING AND CONTINGENCY FUNDING PLANS
In addition to the Bank’s internal liquidity stress metric, the Bank performs liquidity stress testing on multiple alternate scenarios. These scenarios consist of a mix
of TD-specific and market-wide stress events designed to evaluate the potential impact of risk factors material to the Bank’s risk profile. Liquidity risk assessments
are also part of the Bank’s Enterprise-Wide Stress Testing program.
The Bank maintains contingency funding plans (CFPs) for the enterprise and material subsidiaries operating in foreign jurisdictions. As they provide a playbook
for managing stressed liquidity conditions, these plans are an integral component of the Bank’s overall liquidity risk management framework. The CFPs outline
different contingency levels based on the severity and duration of the liquidity event and identify recovery actions appropriate for each level. To support operational
readiness, CFPs provide key steps required to implement each recovery action. Regional CFPs identify recovery actions to address region-specific stress events.
The actions and governance structure outlined in the Bank’s CFPs are aligned with the Bank’s Crisis Management Recovery Plan.
CREDIT RATINGS
Credit ratings may affect the Bank’s access to, and cost of, raising funding and its ability to engage in certain business activities on a cost-effective basis. Credit
ratings and outlooks provided by rating agencies reflect their views and methodologies and are subject to change based on several factors including the Bank’s
financial strength, competitive position, and liquidity, as well as factors not entirely within the Bank’s control, including conditions affecting the overall financial
services industry.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 40
TABLE 36: CREDIT RATINGS
1
As at
July 31, 2026
Moody’s
S&P
Fitch
DBRS
Deposits/Counterparty
2
Aa1
A+
AA+
AA
Senior Debt
3
A2
A-
AA-
AA (low)
Covered Bonds
Aaa
–
AAA
AAA
Legacy Subordinated Debt – non-NVCC
A3
A-
A
A (high)
Tier 2 Subordinated Debt – NVCC
A3 (hyb)
BBB+
A
A (low)
AT1 Perpetual Debt – NVCC
Baa2 (hyb)
BBB-
BBB+
–
Limited Recourse Capital Notes – NVCC
Baa2 (hyb)
BBB-
BBB+
BBB (high)
Preferred Shares – NVCC
Baa2 (hyb)
BBB-
BBB+
Pfd-2
Short-Term Debt (Deposits)
P-1
A-1
F1+
R-1 (high)
Outlook
Stable
Stable
Stable
Stable
1
recommendations to purchase, sell, or hold a financial obligation in as much as they do not comment on market price or suitability for a particular investor. Ratings are subject to revision
or withdrawal at any time by the rating organization.
2
3
The Bank regularly reviews the level of increased collateral its trading counterparties would require in the event of a downgrade of TD’s credit rating. The following
table presents the additional collateral that could have been contractually required to be posted to OTC derivative counterparties as of the reporting date in the
event of one, two, and three-notch downgrades of the Bank’s credit ratings.
TABLE 37: ADDITIONAL COLLATERAL REQUIREMENTS FOR RATING DOWNGRADES
1
(millions of Canadian dollars)
Average for the three months ended
July 31
April 30
2026
2026
One-notch downgrade
$
735
$
966
Two-notch downgrade
1,133
1,364
Three-notch downgrade
2,062
2,253
1
LIQUIDITY COVERAGE RATIO (LCR)
The LCR is a Basel III standard designed to ensure that banks have an adequate stock of unencumbered HQLA, consisting of cash or assets that can be
converted into cash, to meet their liquidity needs for a 30-calendar day liquidity stress scenario.
In accordance with OSFI’s Liquidity Adequacy Requirements (LAR), the Bank must maintain a minimum LCR of 100%, except during periods of financial stress
when institutions are permitted to use their stock of HQLA. The Bank’s LCR is calculated according to the scenario parameters in the LAR guideline, including
prescribed HQLA eligibility criteria and haircuts, deposit run-off, and other outflow and inflow rates. LCR-eligible HQLA consist primarily of central bank reserves,
sovereign-issued or sovereign-guaranteed securities, and high-quality securities issued by non-financial entities.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 41
The following table summarizes the Bank’s average daily LCR as of the relevant dates.
TABLE 38: AVERAGE LIQUIDITY COVERAGE RATIO
1
(millions of Canadian dollars, except as noted)
Average for the three months ended
July 31, 2026
Total unweighted
Total weighted
value (average)
2
value (average)
3
High-quality liquid assets
Total high-quality liquid assets
$
n/a
4
$
333,143
Cash outflows
Retail deposits and deposits from small business customers, of which:
$
516,548
$
33,963
Stable deposits
279,366
8,381
Less stable deposits
237,182
25,582
Unsecured wholesale funding, of which:
391,881
190,103
Operational deposits (all counterparties) and deposits in networks of cooperative banks
145,078
33,958
Non-operational deposits (all counterparties)
221,965
131,307
Unsecured debt
24,838
24,838
Secured wholesale funding
n/a
59,794
Additional requirements, of which:
412,276
132,411
Outflows related to derivative exposures and other collateral requirements
103,841
64,879
Outflows related to loss of funding on debt products
12,182
12,182
Credit and liquidity facilities
296,253
55,350
Other contractual funding obligations
23,366
11,165
Other contingent funding obligations
898,794
13,751
Total cash outflows
$
n/a
$
441,187
Cash inflows
Secured lending
$
308,885
$
61,618
Inflows from fully performing exposures
32,411
15,759
Other cash inflows
113,101
113,101
Total cash inflows
$
454,397
$
190,478
Average for the three months ended
July 31, 2026
April 30, 2026
Total adjusted
Total adjusted
value
value
Total high-quality liquid assets
$
333,143
$
336,237
Total net cash outflows
250,709
258,225
Liquidity coverage ratio
133
%
130
%
1
is calculated as an average of the 64 daily data points in the quarter.
2
3
4
The Bank’s average LCR was 133% for the quarter ended July 31, 2026 and continues to meet regulatory requirements
The Bank holds a variety of liquid assets commensurate with its liquidity needs. Most of these liquid assets also qualify as HQLA under the OSFI LAR guideline.
The Bank’s Level 1 assets for the quarter ended July 31, 2026, as calculated according to OSFI LAR and the BCBS LCR requirements, represent 86% of total
HQLA (April 30, 2026 – 86%). In accordance with the OSFI LAR guideline, the Bank’s reported HQLA excludes excess HQLA from U.S. Banking operations to
reflect liquidity transfer considerations between U.S. Banking and affiliates as a result of the U.S. Federal Reserve Board’s regulations. By excluding excess
HQLA, the U.S. Banking LCR is effectively capped at 100% prior to total Bank consolidation.
As described in the “How TD Manages Liquidity Risk” section of the Bank’s 2025 MD&A, the Bank manages its HQLA and other liquidity buffers to the higher of
TD’s internal 90-day surplus requirement and its target buffers over regulatory requirements including those for LCR, Net Stable Funding Ratio (NSFR), and the
Net Cumulative Cash Flow metrics.
17
The Bank’s expectations regarding liquidity levels are based on the Bank’s assumptions regarding certain factors, including product growth, strategic plans, and pace of share repurchases under the
Bank’s normal course issuer bid (which is subject to financial forecasts and capital requirements). The Bank’s assumptions are subject to inherent uncertainties and may vary based on factors both
within and outside the Bank’s control, including general market conditions, economic outlook and geopolitical matters. Refer to the “Risk Factors That May Affect Future Results” section of this document
for additional information about risks and uncertainties that may impact the Bank’s estimates.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 42
NET STABLE FUNDING RATIO
The NSFR is a Basel III metric calculated as the ratio of total available stable funding (ASF) to total required stable funding (RSF). The Bank must maintain an
NSFR equal to or above 100% in accordance with the LAR guideline. The Bank’s ASF comprises the Bank’s liability and capital instruments (including deposits
and wholesale funding). The assets that require stable funding are a function of the Bank’s on and off-balance sheet activities, their liquidity characteristics, and
OSFI’s LAR guideline requirements.
TABLE 39: NET STABLE FUNDING RATIO
1
(millions of Canadian dollars, except as noted)
As at
July 31, 2026
Unweighted value by residual maturity
6 months to
More than
No
Less than
less than
or equal to
Weighted
maturity
2
6 months
1 year
1 year
value
3
Available Stable Funding Item
Capital
$
122,925
$
n/a
$
n/a
$
6,559
$
129,484
Regulatory capital
122,925
n/a
n/a
6,559
129,484
Other capital instruments
n/a
n/a
n/a
–
–
Retail deposits and deposits from small business customers:
480,314
65,947
39,988
29,432
571,236
Stable deposits
269,863
27,723
16,593
14,342
312,812
Less stable deposits
210,451
38,224
23,395
15,090
258,424
Wholesale funding:
271,212
423,017
111,036
236,040
479,839
Operational deposits
122,568
2,250
–
–
62,409
Other wholesale funding
148,644
420,767
111,036
236,040
417,430
Liabilities with matching interdependent assets
4
–
2,117
1,791
39,124
–
Other liabilities:
49,518
90,863
8,904
NSFR derivative liabilities
n/a
8,217
All other liabilities and equity not included in the above categories
49,518
72,154
3,176
7,316
8,904
Total Available Stable Funding
$
1,189,463
Required Stable Funding Item
Total NSFR high-quality liquid assets
$
$
$
$
$
60,356
Deposits held at other financial institutions for operational purposes
–
–
–
–
–
Performing loans and securities
140,979
294,402
142,197
703,136
834,739
Performing loans to financial institutions secured by Level 1 HQLA
–
73,994
10,362
213
10,315
Performing loans to financial institutions secured by non-Level 1
HQLA and unsecured performing loans to financial institutions
–
92,005
14,948
15,868
33,349
Performing loans to non-financial corporate clients, loans to retail
and small business customers, and loans to sovereigns, central
banks and PSEs, of which:
51,696
76,573
55,321
368,475
425,380
With a risk weight of less than or equal to 35% under the Basel II
standardized approach for credit risk
n/a
–
–
–
–
Performing residential mortgages, of which:
31,207
43,557
52,845
237,919
238,394
With a risk weight of less than or equal to 35% under the Basel II
standardized approach for credit risk
31,207
43,557
52,845
237,919
238,394
Securities that are not in default and do not qualify as HQLA,
including exchange-traded equities
58,076
8,273
8,721
80,661
127,301
Assets with matching interdependent liabilities
4
–
2,493
2,799
37,740
–
Other assets:
77,705
133,168
117,104
Physical traded commodities, including gold
20,039
17,618
Assets posted as initial margin for derivative contracts and
contributions to default funds of CCPs
–
–
–
19,477
16,555
NSFR derivative assets
–
–
11,502
3,285
NSFR derivative liabilities before deduction of variation margin
posted
24,330
1,216
All other assets not included in the above categories
57,666
67,510
2,130
8,219
78,430
Off-balance sheet items
904,429
32,185
Total Required Stable Funding
$
1,044,384
Net Stable Funding Ratio
114
%
As at
April 30, 2026
Total Available Stable Funding
$
1,171,411
Total Required Stable Funding
1,004,256
Net Stable Funding Ratio
117
%
1
2
positions, open maturity positions, non-HQLA equities, and physical traded commodities.
3
4
asset is still on balance sheet, cannot be used to fund any other assets and principal payments from the asset cannot be used for anything other than repaying the liability. As such, the
only interdependent assets and liabilities that qualify for this treatment at the Bank are the liabilities arising from the Canada Mortgage Bonds Program and their corresponding
encumbered assets.
The Bank’s NSFR for the quarter ended July 31, 2026 is 114% (April 30, 2026 – 117%), representing a surplus of $145 billion and adhering to regulatory
requirements.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 43
FUNDING
The Bank has access to a variety of unsecured and secured funding sources. The Bank’s funding activities are conducted in accordance with liquidity risk
management policies that require assets be funded to the appropriate term and to a prudent diversification profile.
The Bank’s primary approach to funding is to maximize the use of deposits raised through its personal, wealth and business and commercial banking channels.
The deposits raised from these sources were approximately
% (October 31, 2025 –
%) of the Bank’s total funding. Non-personal deposit funding as reflected
below does not include the Bank’s Wholesale Banking deposits (including Corporate & Investment Banking).
TABLE 40: SUMMARY OF DEPOSIT FUNDING
1
(millions of Canadian dollars)
As at
July 31
October 31
2026
2025
Personal
$
$
Non-personal
Total
$
$
1
The calculation methodology reflects deposit funding from personal, wealth and business and commercial banking channels.
WHOLESALE FUNDING
The Bank maintains various registered external wholesale term (greater than 1 year) funding programs to provide access to diversified funding sources, including
asset securitization, covered bonds, and unsecured wholesale debt. The Bank’s wholesale funding is diversified by geography, currency, and funding types. The
Bank raises short-term (1 year or less) funding using certificates of deposit and commercial paper.
The following table summarizes the term funding and capital programs by geography, with the related program size as at July 31, 2026.
Canada
United States
Europe
Capital Securities Program ($20 billion)
Canadian Senior Medium-Term Linked Notes
Program ($10 billion)
HELOC asset backed securities (ABS) Program
(Genesis Trust II) ($7 billion)
U.S. SEC (F-3) Registered Capital and Debt
Program (US$75 billion)
U.K. Financial Conduct Authority (FCA) Registered
Legislative Covered Bond Program ($100 billion)
FCA Registered Global Medium-Term Note Program
(US$40 billion)
Non-Registered Structured Global Medium-Term
Linked Notes Program (US$20 billion)
The following table presents a breakdown of the Bank’s term debt by currency and funding type. Term funding was $188.4 billion as at July 31, 2026
(October 31, 2025 – $192.0 billion).
Note that Table 41: Long-Term Funding and Table 42: Wholesale Funding do not include any funding accessed via repurchase transactions or securities financing.
TABLE 41: LONG-TERM FUNDING
1
As at
July 31
October 31
Long-term funding by currency
2026
2025
Canadian dollar
27
%
26
%
U.S. dollar
33
33
Euro
30
32
British pound
6
4
Other
4
5
Total
100
%
100
%
Long-term funding by type
Senior unsecured medium-term notes
56
%
53
%
Covered bonds
33
37
Mortgage securitization
2
9
8
Term asset-backed securities
2
2
Total
100
%
100
%
1
maturity of greater than one year.
2
The Bank maintains depositor concentration limits in respect of short-term wholesale deposits so that it is not overly reliant on individual depositors for funding.
The Bank further limits short-term wholesale funding maturity concentration in an effort to mitigate refinancing risk during a stress event.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 44
The following table represents the remaining maturity of various sources of funding outstanding as at July 31, 2026 and October 31, 2025.
TABLE 42: WHOLESALE FUNDING
(millions of Canadian dollars)
As at
July 31
October 31
2026
2025
Less than
1 to 3
3 to 6
6 months
Up to 1
Over 1 to
Over
1 month
months
months
to 1 year
year
2 years
2 years
Total
Total
Deposits from banks
1
$
1,226
$
557
$
554
$
290
$
2,627
$
–
$
–
$
2,627
$
2,738
Bearer deposit notes
615
2,204
617
776
4,212
–
–
4,212
5,732
Certificates of deposit
8,205
34,560
31,122
43,445
117,332
820
–
118,152
90,513
Commercial paper
9,587
10,567
10,729
14,294
45,177
703
–
45,880
53,759
Covered bonds
–
5,402
4,360
15,529
25,291
6,050
31,071
62,412
70,558
Mortgage securitization
2
59
1,236
987
2,041
4,323
4,339
34,819
43,481
40,124
Senior unsecured medium-term notes
3
–
2,382
7,840
10,448
20,670
24,947
59,600
105,217
102,136
Subordinated notes and debentures
4
–
–
–
–
–
–
10,523
10,523
10,733
Term asset-backed securitization
246
2,735
5,227
5,030
13,238
1,124
1,499
15,861
15,702
Other
5
14,291
10,493
7,728
3,420
35,932
2,747
4,420
43,099
27,695
Total
$
34,229
$
70,136
$
69,164
$
95,273
$
268,802
$
40,730
$
141,932
$
451,464
$
419,690
Of which:
Secured
$
305
$
14,979
$
16,881
$
24,002
$
56,167
$
11,513
$
67,389
$
135,069
$
126,388
Unsecured
33,924
55,157
52,283
71,271
212,635
29,217
74,543
316,395
293,302
Total
$
34,229
$
70,136
$
69,164
$
95,273
$
268,802
$
40,730
$
141,932
$
451,464
$
419,690
1
2
3
$2.4 billion of structured notes subject to conversion under the “bail-in” regime (October 31, 2025 – $3.3 billion).
4
5
Includes fixed-term deposits from non-bank institutions (unsecured) of $24.1 billion (October 31, 2025 – $25.1 billion) and the remaining are non-term deposits.
Effective the third quarter
of 2026, certain global transaction banking deposits have been removed from the presentation to better align with how management views the Bank’s composition of wholesale funding.
The comparative period balance has been restated to conform with this change.
Excluding the Wholesale Banking residential mortgage trading business, the Bank’s total mortgage-backed securities issued to external investors for the three and
nine months ended July 31, 2026, were $1.4 billion and $3.8 billion, respectively (three and nine months ended July 31, 2025 – $1.0 billion and $3.3 billion,
respectively) and other asset-backed securities issued for the three and nine months ended July 31, 2026, were nil (three and nine months ended July 31, 2025 –
nil and $0.2 billion, respectively). The Bank also issued $4.3 billion and $19.6 billion, respectively, of unsecured medium-term notes for the three months and nine
months ended July 31, 2026 (three months and nine months ended July 31, 2025 – $7.1 billion and $17.5 billion, respectively). Covered bonds issued for the three
and nine months ended July 31, 2026 were nil and $5.2 billion, respectively (three and nine months ended July 31, 2025 – nil).
REGULATORY DEVELOPMENTS CONCERNING LIQUIDITY AND FUNDING
In January 2026, OSFI released its final revised LAR guideline which came into effect May 1, 2026. Amendments include introduction of deposit categorizations for
measuring liquidity risks from structured notes and deposits sourced through non-bank financial intermediaries, and clarification of expectations for instruments
with contingent features and/or uncertain maturity profiles, particularly in relation to their early redemption characteristics and associated liquidity implications.
In May 2026, OSFI engaged institutions in a public consultation of its draft Internal Liquidity Adequacy Assessment Process (ILAAP) Guideline outlining
expectations for how institutions are to assess, manage and report their liquidity risks. ILAAP is intended to complement existing liquidity standards and
requirements.
ISSB – IFRS S1 and IFRS S2
In March 2025, OSFI released updates to Guideline B-15 to ensure continued interoperability with the requirements of the final Canadian Sustainability Standards
Board (CSSB) standards. Key updates include postponing the implementation date for industry-based metrics and Scope 3 Greenhouse Gas (GHG) emissions
disclosures from fiscal year end 2025 to 2028. The Bank’s 2025 annual sustainability report suite incorporates the phased-in cross-industry metrics requirements,
effective for October 31, 2025.
In April 2025, the Canadian Securities Administrators (CSA) announced that it is pausing work on the development of a new mandatory climate-related disclosure
rule that is based on the two standards issued by the CSSB. The CSSB standards were released in December 2024 and are based on the international
sustainability standards issued by the International Sustainability Standards Board (ISSB). They set out the disclosure requirements for financially material
information about sustainability and climate-related risks and opportunities to meet investor information needs. For these standards to become mandatory
requirements in Canada, they would need to be incorporated into a CSA rule. The Bank continues to assess the impact of adopting these standards and to monitor
developments from various standard setters and regulators.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 45
SECURITIZATION AND OFF-BALANCE SHEET ARRANGEMENTS
The Bank enters into securitization and off-balance sheet arrangements in the normal course of operations. The Bank is involved with structured entities (SEs) that
it sponsors, as well as entities sponsored by third parties. Refer to “Securitization and Off-Balance Sheet Arrangements” section, Note 9: Transfers of Financial
Assets and Note 10: Structured Entities of the Bank’s 2025 Annual Report for further details. There have been no significant changes to the Bank’s securitization
and off-balance sheet arrangements during the quarter ended July 31, 2026.
Securitization of Third-Party Originated Assets
Significant Unconsolidated Special Purpose Entities
The Bank securitizes third-party originated assets through Bank-sponsored SEs, including its multi-seller conduits which are not consolidated. Multi-seller conduits
securitize third-party originated assets. The Bank administers multi-seller conduits and provides liquidity facilities as well as securities distribution services; it may
also provide credit enhancements. TD’s total potential exposure to loss through the provision of liquidity facilities for multi-seller conduits was $62.2 billion as at
July 31, 2026 (October 31, 2025 – $57.5 billion). As at July 31, 2026, the Bank had funded exposure of $42.6 billion under such liquidity facilities relating to
outstanding issuances of asset-backed commercial paper (ABCP) (October 31, 2025 – $38.5 billion).
ACCOUNTING POLICIES AND ESTIMATES
The Bank’s unaudited Interim Consolidated Financial Statements have been prepared in accordance with IFRS. For details of the Bank’s accounting policies under
IFRS, refer to Note 2 of the Bank’s third quarter 2026 Interim Consolidated Financial Statements and 2025 Annual Consolidated Financial Statements. For details
of the Bank’s significant accounting judgments, estimates, and assumptions under IFRS, refer to Note 3 of the Bank’s third quarter 2026 Interim Consolidated
Financial Statements and the Bank’s 2025 Annual Consolidated Financial Statements.
CURRENT CHANGES IN ACCOUNTING POLICIES
There were no new accounting policies adopted by the Bank for the three and nine months ended July 31, 2026.
ACCOUNTING JUDGMENTS, ESTIMATES, AND ASSUMPTIONS
The estimates used in the Bank’s accounting policies are essential to understanding its results of operations and financial condition. Some of the Bank’s policies
require subjective, complex judgments and estimates as they relate to matters that are inherently uncertain. Changes in these judgments or estimates and
changes to accounting standards and policies could have a materially adverse impact on the Bank’s Interim Consolidated Financial Statements. The Bank has
established procedures to ensure that accounting policies are applied consistently and that the processes for changing methodologies, determining estimates, and
adopting new accounting standards are well-controlled and occur in an appropriate and systematic manner.
Impairment – Expected Credit Loss Model
The ECL model requires the application of judgments, estimates, and assumptions in the assessment of the current and forward-looking economic environment.
There remains elevated economic uncertainty, and management continues to exercise expert credit judgment in assessing if an exposure has experienced
significant increase in credit risk since initial recognition and in determining the amount of ECLs at each reporting date. To the extent that certain effects are not
fully incorporated into the model calculations, temporary quantitative and qualitative adjustments have been applied, including for risks related to elevated
uncertainty associated with policy and trade, and such adjustments will be updated as appropriate in future periods.
FUTURE CHANGES IN ACCOUNTING POLICIES
There were no new accounting standards or amendments issued during the three and nine months ended July 31, 2026. Refer to Note 4 of the Bank’s 2025
Annual Consolidated Financial Statements for a description of future changes in accounting policies.
CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING
During the most recent interim period, there have been no changes in the Bank’s policies and procedures and other processes that comprise its internal control
over financial reporting, that have materially affected, or are reasonably likely to materially affect, the Bank’s internal control over financial reporting. Refer to
Note 2 and Note 3 of the Bank’s third quarter 2026 Interim Consolidated Financial Statements for further information regarding the Bank’s changes to accounting
policies, procedures, and estimates.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 46
GLOSSARY
FINANCIAL AND BANKING TERMS
Adjusted Results:
Bank’s businesses and to measure the Bank’s overall performance. To arrive at
adjusted results, the Bank adjusts for “items of note”, from reported results. The
items of note relate to items which management does not believe are indicative
of underlying business performance.
Allowance for Credit Losses:
financial assets, including any off-balance sheet exposures, at the balance
sheet date. Allowance for credit losses consists of Stage 3 allowance for
impaired financial assets and Stage 2 and Stage 1 allowance for performing
financial assets and off-balance sheet instruments. The allowance is increased
by the provision for credit losses, decreased by write-offs net of recoveries and
disposals, and impacted by foreign exchange.
Amortized Cost:
measured at initial recognition minus principal repayments, plus or minus the
cumulative amortization, using EIRM, of any differences between the initial
amount and the maturity amount, and minus any reduction for impairment.
Assets under Administration (AUA):
customers where the Bank provides services of an administrative nature, such
as the collection of investment income and the placing of trades on behalf of the
clients (where the client has made his or her own investment selection). The
majority of these assets are not reported on the Bank’s Consolidated Balance
Sheet.
Assets under Management (AUM):
customers, managed by the Bank, where the Bank has discretion to make
investment selections on behalf of the client (in accordance with an investment
policy). In addition to the TD family of mutual funds, the Bank manages assets
on behalf of individuals, pension funds, corporations, institutions, endowments
and foundations. These assets are not reported on the Bank’s Consolidated
Balance Sheet. Some assets under management that are also administered by
the Bank are included in assets under administration.
Asset-Backed Commercial Paper (ABCP):
collateralized by other financial assets. Institutional investors usually purchase
such instruments in order to diversify their assets and generate short-term
gains.
Asset-Backed Securities (ABS):
payments are derived from and collateralized (or “backed”) by a specified pool
of underlying assets.
Average Common Equity:
Average common equity for the business segments
reflects the average allocated capital. The Bank’s methodology for allocating
capital to its business segments is largely aligned with the common equity
capital requirements under Basel III.
Average Interest-Earning Assets:
the Bank’s financial position, and is calculated as the average carrying value of
deposits with banks, loans and securities based on daily balances for the period
ending October 31 in each fiscal year.
Basic Earnings per Share (EPS):
dividing net income available to common shareholders by the weighted average
number of common shares outstanding for the period. Adjusted basic EPS is
calculated in the same manner using adjusted net income.
Basis Points (bps):
100 basis points.
Book Value per Share:
shareholders’ equity by number of common shares at the end of the period.
Carrying Value:
Consolidated Balance Sheet.
Catastrophe Claims:
occurred in the period, for which the aggregate insurance claims are equal to
or greater than an internal threshold of $5 million before reinsurance. The
Bank’s internal threshold may change from time to time.
Collateralized Mortgage Obligation (CMO):
obligations consisting of mortgage-backed securities that are separated and
issued as different classes of mortgage pass-through securities with different
terms, interest rates, and risks. CMOs by private issuers are collectively
referred to as non-agency CMOs.
Common Equity Tier 1 (CET1) Capital:
This is a primary Basel III capital
measure comprised mainly of common equity, retained earnings and qualifying
non-controlling interest in subsidiaries. Regulatory deductions made to arrive
at the CET1 Capital include goodwill and intangibles, unconsolidated
investments in banking, financial, and insurance entities, deferred tax assets,
defined benefit pension fund assets, and shortfalls in allowances.
Common Equity Tier 1 (CET1) Capital Ratio:
CET1 Capital ratio represents
the predominant measure of capital adequacy under Basel III
and equals CET1 Capital divided by RWA.
Compound Annual Growth Rate (CAGR):
time periods from the initial investment value to the ending investment value
assuming that the investment has been compounding over the time period.
Credit Valuation Adjustment (CVA):
CVA represents a capital charge that
measures credit risk due to default of derivative counterparties. This charge
requires banks to capitalize for the potential changes in counterparty credit
spread for the derivative portfolios.
Diluted EPS:
available to common shareholders by the weighted average number of
common shares outstanding adjusting for the effect of all potentially dilutive
common shares. Adjusted diluted EPS is calculated in the same manner using
adjusted net income.
Dividend Payout Ratio:
being paid to common shareholders in the form of dividends and is calculated
by dividing common dividends by net income available to common
shareholders. Adjusted dividend payout ratio is calculated in the same manner
using adjusted net income.
Dividend Yield:
year divided by the daily average closing stock price during the year.
Effective Income Tax Rate:
A rate and performance indicator calculated by
dividing the provision for income taxes as a percentage of net income before
taxes. Adjusted effective income tax rate is calculated in the same manner
using adjusted results.
Effective Interest Rate (EIR):
flows for the expected life of the financial instrument to its carrying value. The
calculation takes into account the contractual interest rate, along with any fees
or incremental costs that are directly attributable to the instrument and all other
premiums or discounts.
Effective Interest Rate Method (EIRM):
interest rate in a period based on the amount of a financial instrument’s book
value at the beginning of the accounting period. Under EIRM, the effective
interest rate, which is a key component of the calculation, discounts the
expected future cash inflows and outflows expected over the life of a financial
instrument.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 47
Efficiency Ratio:
calculated by taking the non-interest expenses as a percentage of total revenue.
A lower ratio indicates a more efficient business operation. Adjusted efficiency
ratio is calculated in the same manner using adjusted non-interest expenses
and adjusted total revenue.
Enhanced Disclosure Task Force (EDTF):
Established by the FSB in
May 2012, comprised of banks, analysts, investors, and auditors, with the goal
of enhancing the risk disclosures of banks and other financial institutions.
Expected Credit Losses (ECLs):
ECLs are the probability-weighted present
value of expected cash shortfalls over the remaining expected life of the
financial instrument and considers reasonable and supportable information
about past events, current conditions, and forecasts of future events and
economic conditions that impact the Bank’s credit risk assessment.
Fair Value:
a liability in an orderly transaction between market participants at the
measurement date, under current market conditions.
Fair value through other comprehensive income (FVOCI):
Under IFRS 9, if
the asset passes the contractual cash flows test (named SPPI), the business
model assessment determines how the instrument is classified. If the instrument
is being held to collect contractual cash flows, that is, if it is not expected to be
sold, it is measured as amortized cost. If the business model for the instrument
is to both collect contractual cash flows and potentially sell the asset, it is
measured at FVOCI.
Fair value through profit or loss (FVTPL):
Under IFRS 9, the classification is
dependent on two tests, a contractual cash flow test (named SPPI) and a
business model assessment. Unless the asset meets the requirements of both
tests, it is measured at fair value with all changes in fair value reported in profit
or loss.
Federal Deposit Insurance Corporation (FDIC):
A U.S. government
corporation which provides deposit insurance guaranteeing the safety of a
depositor’s accounts in member banks. The FDIC also examines and
supervises certain financial institutions for safety and soundness, performs
certain consumer-protection functions, and manages banks in receiverships
(failed banks).
Forward Contracts:
one party to the contract to buy and the other party to sell an asset for a fixed
price at a future date.
Futures:
price on a specified future date.
Hedging:
exposure to fluctuations in interest rates, foreign currency exchange rates, or
other market factors. The elimination or reduction of such exposure is
accomplished by engaging in capital markets activities to establish offsetting
positions.
Impaired Loans:
deterioration of credit quality to the extent that the Bank no longer has
reasonable assurance as to the timely collection of the full amount of principal
and interest.
Loss Given Default (LGD):
incur when a borrower defaults on a loan, which is expressed as a percentage
of exposure at default.
Mark-to-Market (MTM):
balance sheet date for financial instruments that are carried at fair value.
Master Netting Agreements:
have multiple derivative contracts with each other that provide for the net
settlement of all contracts through a single payment, in a single currency, in
the event of default or termination of any one contract.
Net Corporate Expenses:
Non-interest expenses related to corporate service
and control groups which are not allocated to a business segment.
Net Interest Margin:
percentage of average interest-earning assets to measure performance. This
metric is an indicator of the profitability of the Bank’s earning assets less the
cost of funding. Adjusted net interest margin is calculated in the same manner
using adjusted net interest income.
Non-Viability Contingent Capital (NVCC):
Instruments (preferred shares and
subordinated debt) that contain a feature or a provision that allows the financial
institution to either permanently convert these instruments into common shares
or fully write-down the instrument, in the event that the institution is no longer
viable.
Notional:
instruments are based.
Office of the Superintendent of Financial Institutions Canada (OSFI):
The
regulator of Canadian federally chartered financial institutions and federally
administered pension plans.
Operating Leverage:
A
non-GAAP measure that the Bank calculates as the
difference between the % change in adjusted revenue (U.S. Banking in source
currency) net of insurance service expense (ISE), and adjusted expenses
(U.S. Banking in US$) grossed up by the retailer program partners’ share of
PCL for the Bank’s U.S. strategic cards portfolio. Collectively, these
adjustments provide a measure of operating leverage that management
believes is more reflective of underlying business performance.
Options:
right, but not the obligation, to buy or to sell a security, exchange rate, interest
rate, or other financial instrument or commodity at a predetermined price at or
by a specified future date.
Price-Earnings Ratio:
EPS based on a trailing four quarters to indicate market performance. Adjusted
price-earnings ratio is calculated in the same manner using adjusted EPS.
Probability of Default (PD):
to meet its scheduled repayments.
Provision for Credit Losses (PCL):
losses to bring it to a level that management considers adequate to reflect
expected credit-related losses on its portfolio.
Return on Common Equity (ROE):
as net income available to common shareholders as a percentage of average
common shareholders’ equity, utilized in assessing the Bank’s use of equity.
ROE for the business segments is calculated as the segment net income
available to common shareholders as a percentage of average allocated
capital. Adjusted ROE is calculated in the same manner using adjusted net
income.
Return on Tangible Common Equity (ROTCE):
measure calculated as reported net income available to common shareholders
after adjusting for the after-tax amortization of acquired intangibles, which are
treated as an item of note, as a percentage of average Tangible common
equity. Adjusted ROTCE is calculated in the same manner using adjusted net
income. Both measures can be utilized in assessing the Bank’s use of equity.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 48
Return on Risk-weighted Assets:
Net income available to common
shareholders as a percentage of average risk-weighted assets.
Risk-Weighted Assets (RWA):
Assets calculated by applying a regulatory risk-
weight factor to on and off-balance sheet exposures. The risk-weight factors are
established by the OSFI to convert on and off-balance sheet exposures to a
comparable risk level.
Securitization:
transferred to structures, which normally issue a series of asset-backed
securities to investors to fund the purchase of loans.
Solely Payments of Principal and Interest (SPPI):
financial asset that are consistent with a basic lending arrangement.
Swaps:
payment obligations and currencies on a notional principal for a specified period
of time.
Tangible common equity (TCE):
common shareholders’ equity less goodwill, imputed goodwill, and intangibles
on an investment in Schwab and other acquired intangible assets, net of related
deferred tax liabilities. It can be utilized in assessing the Bank’s use of equity.
Taxable Equivalent Basis (TEB):
that increases revenues and the provision for income taxes on certain tax-
exempt securities to an equivalent before-tax basis to facilitate comparison of
net interest income from both taxable and tax-exempt sources.
Tier 1 Capital Ratio:
capital, consisting primarily of common shareholders’ equity, retained earnings,
preferred shares and innovative instruments. Tier 1 Capital ratio is calculated as
Tier 1 Capital divided by RWA.
Total Capital Ratio:
Capital. Total Capital ratio is calculated as Total Capital divided by RWA.
Total Shareholder Return (TSR):
TD’s common shares. The return measures the change in shareholder value,
assuming dividends paid are reinvested in additional shares.
Trading-Related Revenue:
trading income (loss), net interest income on trading positions, and income from
financial instruments designated at FVTPL that are managed within a trading
portfolio. Trading-related revenue (TEB) in the Wholesale Banking segment is
also a non-GAAP financial measure and is calculated in the same manner,
including TEB adjustments. Both are used for measuring trading performance.
Value-at-Risk (VaR):
and to calculate the regulatory capital required for market risk in trading
activities. VaR measures the adverse impact that potential changes in market
rates and prices could have on the value of a portfolio over a specified period of
time.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 49
INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
INTERIM CONSOLIDATED BALANCE SHEET
(unaudited)
(As at and in millions of Canadian dollars)
July 31, 2026
October 31, 2025
ASSETS
Cash and due from banks
$
$
Interest-bearing deposits with banks
Trading loans, securities, and other
Non-trading financial assets at fair value through profit or loss
Derivatives
Financial assets designated at fair value through profit or loss
Financial assets at fair value through other comprehensive income
Debt securities at amortized cost, net of allowance for credit losses (Notes 4, 5)
Securities purchased under reverse repurchase agreements (Note 4)
Loans (Notes 4, 6)
Residential mortgages
Consumer instalment and other personal
Credit card
Business and government
Allowance for loan losses
(8,508 )
(8,689 )
Loans, net of allowance for loan losses
Other
Goodwill
Other intangibles
Land, buildings, equipment, other depreciable assets and right-of-use assets
Deferred tax assets
Amounts receivable from brokers, dealers, and clients
Other assets
Total assets
$
$
LIABILITIES
Trading deposits
$
$
Derivatives
Securitization liabilities at fair value
Financial liabilities designated at fair value through profit or loss
Deposits (Notes 4, 9)
Personal
Banks
Business and government
Other
Obligations related to securities sold short
Obligations related to securities sold under repurchase agreements
Securitization liabilities at amortized cost
Amounts payable to brokers, dealers, and clients
Insurance contract liabilities
Other liabilities
Subordinated notes and debentures (Notes 4, 11)
Total liabilities
EQUITY
Shareholders’ Equity
Common shares
Preferred shares and other equity instruments
Treasury – common shares
(19 )
Treasury – preferred shares and other equity instruments
(46 )
(4 )
Contributed surplus
Retained earnings
Accumulated other comprehensive income (loss)
Total equity
Total liabilities and equity
$
$
The accompanying Notes are an integral part of these Interim Consolidated Financial Statements.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 50
INTERIM CONSOLIDATED STATEMENT OF INCOME
(unaudited)
(millions of Canadian dollars, except as noted)
For the three months ended
For the nine months ended
July 31
July 31
July 31
July 31
2026
2025
2026
2025
Interest income
1
Loans
$
$
$
$
Reverse repurchase agreements
Securities
Interest
Dividends
Deposits with banks
Interest expense (Note 19)
Deposits
Securitization liabilities
Subordinated notes and debentures
Repurchase agreements and short sales
Other
Net interest income
Non-interest income
Investment and securities services
Credit fees
Trading income (loss)
Service charges
Card services
Insurance revenue
Other income (loss)
(135 )
Total revenue
Provision for (recovery of) credit losses (Note 6)
Insurance service expenses
Non-interest expenses
Salaries and employee benefits
Occupancy, including depreciation
Technology and equipment, including depreciation
Amortization of other intangibles
Communication and marketing
Restructuring charges (recovery)
(10 )
Brokerage-related and sub-advisory fees
Professional, advisory and outside services
Other
Income before income taxes and share of net income from investment
in Schwab
Provision for (recovery of) income taxes
Share of net income from investment in Schwab (Note 7)
Net income
Preferred dividends and distributions on other equity instruments
Net income available to common shareholders
$
$
$
$
Earnings per share
Basic
$
$
$
$
Diluted
Dividends per common share
1
$
The accompanying Notes are an integral part of these Interim Consolidated Financial Statements.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 51
INTERIM CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
(unaudited)
(millions of Canadian dollars)
For the three months ended
For the nine months ended
July 31
July 31
July 31
July 31
2026
2025
2026
2025
Net income
$
$
$
$
Other comprehensive income (loss)
Items that will be subsequently reclassified to net income
Net change in unrealized gain/(loss) on financial assets at fair value
through other comprehensive income
Unrealized gain/(loss)
(21 )
Reclassification to earnings of net loss/(gain)
(4 )
(6 )
Allowance for credit losses recognized in earnings
Income taxes relating to:
Unrealized gain/(loss)
(104 )
(19 )
(55 )
Reclassification to earnings of net loss/(gain)
(5 )
(1 )
(19 )
Net change in unrealized foreign currency translation gain/(loss) on
investments in foreign operations, net of hedging activities
Unrealized gain/(loss)
(405 )
Reclassification to earnings of net loss/(gain)
(1 )
(534 )
Net gain/(loss) on hedges
(2,633 )
(465 )
(260 )
Reclassification to earnings of net loss/(gain) on hedges
Income taxes relating to:
Net gain/(loss) on hedges
(17 )
Reclassification to earnings of net loss/(gain) on hedges
(220 )
(123 )
(328 )
Net change in gain/(loss) on derivatives designated as cash flow hedges
Gain/(loss)
(1,275 )
Reclassification to earnings of loss/(gain)
(2,881 )
(1,214 )
(1,512 )
(2,616 )
Income taxes relating to:
Gain/(loss)
(488 )
(40 )
(1,135 )
Reclassification to earnings of loss/(gain)
(788 )
(816 )
(2,038 )
Share of other comprehensive income (loss) from investment in Schwab
Items that will not be subsequently reclassified to net income
Remeasurement gain/(loss) on employee benefit plans
Gain/(loss)
(23 )
(40 )
Income taxes
(17 )
(28 )
(17 )
(28 )
Change in net unrealized gain/(loss) on equity securities designated at
fair value through other comprehensive income
Net unrealized gain/(loss)
Income taxes
(2 )
(17 )
(12 )
(33 )
Gain/(loss) from changes in fair value due to own credit risk on
financial liabilities designated at fair value through profit or loss
Gain/(loss)
(6 )
(47 )
(9 )
(18 )
Income taxes
(4 )
(34 )
(7 )
(13 )
Total other comprehensive income (loss)
(312 )
(2,031 )
Total comprehensive income (loss)
$
$
$
$
Available to:
Common shareholders
$
$
$
$
Preferred shareholders and other equity instrument holders
The accompanying Notes are an integral part of these Interim Consolidated Financial Statements.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 52
INTERIM CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
(unaudited)
(millions of Canadian dollars)
For the three months ended
For the nine months ended
July 31, 2026
July 31, 2025
July 31, 2026
July 31, 2025
Common shares (Note 12)
Balance at beginning of period
$
$
$
$
Proceeds from shares issued on exercise of stock options
Shares issued as a result of dividend reinvestment plan
Purchase of shares for cancellation and other
(212 )
(227 )
(780 )
(663 )
Balance at end of period
Preferred shares and other equity instruments (Note 12)
Balance at beginning of period
Issuance of shares and other equity instruments
Redemption of shares and other equity instruments
(350 )
(850 )
Balance at end of period
Treasury – common shares (Note 12)
Balance at beginning of period
(60 )
(26 )
(17 )
Purchase of shares
(2,949 )
(3,222 )
(9,162 )
(9,606 )
Sale of shares
Balance at end of period
(19 )
(92 )
(19 )
(92 )
Treasury – preferred shares and other equity instruments (Note 12)
Balance at beginning of period
(14 )
(28 )
(4 )
(18 )
Purchase of shares and other equity instruments
(2,022 )
(73 )
(2,537 )
(1,460 )
Sale of shares and other equity instruments
Balance at end of period
(46 )
(2 )
(46 )
(2 )
Contributed surplus
Balance at beginning of period
Net premium (discount) on sale of treasury instruments
(8 )
Issuance of stock options, net of options exercised
Other
Balance at end of period
Retained earnings
Balance at beginning of period
Net income available to equity instrument holders
Common dividends
(1,840 )
(1,798 )
(5,437 )
(5,449 )
Preferred dividends and distributions on other equity instruments
(94 )
(88 )
(397 )
(374 )
Share and other equity instrument issue expenses
(4 )
(4 )
(2 )
Net premium on repurchase of common shares and redemption of preferred shares and other
equity instruments
(2,182 )
(1,334 )
(6,665 )
(3,469 )
Remeasurement gain/(loss) on employee benefit plans
(17 )
(28 )
Realized gain/(loss) on equity securities designated at fair value through
other comprehensive income
(13 )
Balance at end of period
Accumulated other comprehensive income (loss)
Net unrealized gain/(loss) on financial assets at fair value through other comprehensive income:
Balance at beginning of period
(352 )
(208 )
Other comprehensive income (loss)
(19 )
Allowance for credit losses
Balance at end of period
(37 )
(37 )
Net unrealized gain/(loss) on equity securities designated at fair value through
other comprehensive income:
Balance at beginning of period
Other comprehensive income (loss)
Reclassification of loss/(gain) to retained earnings
(48 )
(10 )
(83 )
Balance at end of period
Gain/(loss) from changes in fair value due to own credit risk on financial liabilities
designated at fair value through profit or loss:
Balance at beginning of period
(31 )
(1 )
(28 )
(22 )
Other comprehensive income (loss)
(4 )
(34 )
(7 )
(13 )
Balance at end of period
(35 )
(35 )
(35 )
(35 )
Net unrealized foreign currency translation gain/(loss) on investments in foreign
operations, net of hedging activities:
Balance at beginning of period
Other comprehensive income (loss)
(123 )
(328 )
Balance at end of period
Net gain/(loss) on derivatives designated as cash flow hedges:
Balance at beginning of period
(2,019 )
(1,078 )
(769 )
(2,924 )
Other comprehensive income (loss)
(788 )
(816 )
(2,038 )
Balance at end of period
(2,807 )
(1,894 )
(2,807 )
(1,894 )
Total accumulated other comprehensive income
Total equity
$
$
$
$
The accompanying Notes are an integral part of these Interim Consolidated Financial Statements.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 53
INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS
(millions of Canadian dollars)
For the three months ended
For the nine months ended
July 31
July 31
July 31
July 31
2026
2025
2026
2025
Cash flows from (used in) operating activities
Net income
$
$
$
$
Adjustments to determine net cash flows from (used in) operating activities
Gain on Sale of Schwab shares
(9,159 )
Provision for (recovery of) credit losses
Depreciation
Amortization of other intangibles
Net securities loss/(gain)
(12 )
(14 )
Share of net income from investment in Schwab
(305 )
Deferred taxes
(453 )
(440 )
(302 )
(967 )
Changes in operating assets and liabilities
Interest receivable and payable
(284 )
(117 )
(1,129 )
Obligations related to securities sold under repurchase agreements
Securities purchased under reverse repurchase agreements
(11,248 )
(11,804 )
(20,063 )
Obligations related to securities sold short
(369 )
(2,895 )
(1,871 )
Trading loans, securities, and other
(10,677 )
(29,909 )
Loans net of securitization and sales
(27,681 )
(635 )
(41,015 )
Deposits
(6,485 )
(776 )
(9,068 )
Derivatives
(4,444 )
(1,131 )
Non-trading financial assets at fair value through profit or loss
(1,439 )
(2,139 )
(500 )
Financial assets and liabilities designated at fair value through profit or loss
(9,253 )
(13,447 )
Securitization liabilities
Current income taxes
(695 )
Amounts receivable and payable from brokers, dealers, and clients
(283 )
(3,935 )
Other, including unrealized foreign currency translation loss/(gain)
(6,163 )
(18,963 )
(23,075 )
Net cash from (used in) operating activities
(5,860 )
(21,692 )
(60,233 )
Cash flows from (used in) financing activities
Issuance of subordinated notes and debentures
Redemption or repurchase of subordinated notes and debentures
(194 )
(1,263 )
(3,188 )
Common shares issued, net of issuance costs
Repurchase of common shares, including tax on net value of share repurchases
(2,394 )
(1,561 )
(7,445 )
(4,132 )
Preferred shares and other equity instruments issued, net of issuance costs
Redemption of preferred shares and other equity instruments
(350 )
(850 )
Sale of treasury shares and other equity instruments
Purchase of treasury shares and other equity instruments
(4,971 )
(3,295 )
(11,699 )
(11,066 )
Dividends paid on shares and distributions paid on other equity instruments
(1,934 )
(1,886 )
(5,834 )
(5,693 )
Repayment of lease liabilities
(186 )
(504 )
(517 )
(1,013 )
Net cash from (used in) financing activities
(3,220 )
(4,437 )
(12,678 )
(11,909 )
Cash flows from (used in) investing activities
Interest-bearing deposits with banks
Activities in financial assets at fair value through other comprehensive income
Purchases
(14,003 )
(25,139 )
(35,765 )
(67,952 )
Proceeds from maturities
Proceeds from sales
Activities in debt securities at amortized cost
Purchases
(7,640 )
(12,460 )
(33,885 )
(41,797 )
Proceeds from maturities
Proceeds from sales
Net purchases of land, buildings, equipment, other depreciable assets, and other intangibles
(731 )
(575 )
(1,886 )
(1,508 )
Net cash acquired from divestitures
Net cash from (used in) investing activities
(4,988 )
Effect of exchange rate changes on cash and due from banks
(18 )
Net increase (decrease) in cash and due from banks
(700 )
(920 )
Cash and due from banks at beginning of period
Cash and due from banks at end of period
$
$
$
$
Supplementary disclosure of cash flows from operating activities
Amount of income taxes paid (refunded) during the period
$
$
$
$
Amount of interest paid during the period
Amount of interest received during the period
Amount of dividends received during the period
The accompanying Notes are an integral part of these Interim Consolidated Financial Statements.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 54
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
NOTE 1: NATURE OF OPERATIONS
CORPORATE INFORMATION
The Toronto-Dominion Bank is a bank chartered under the
Bank Act (Canada)
. The shareholders of a bank are not, as shareholders, liable for any liability, act, or
default of the bank except as otherwise provided under the
Bank Act (Canada)
. The Toronto-Dominion Bank and its subsidiaries are collectively known as
TD Bank Group (“TD” or the “Bank”). The Bank was formed through the amalgamation on February 1, 1955, of The Bank of Toronto (chartered in 1855) and The
Dominion Bank (chartered in 1869). The Bank is incorporated and domiciled in Canada with its registered and principal business offices located at 66 Wellington
Street West, Toronto, Ontario. TD serves customers in four business segments operating in a number of locations in key financial centres around the globe:
Canadian Personal and Commercial Banking, U.S. Banking, Wealth Management and Insurance, and Wholesale Banking.
BASIS OF PREPARATION
The accompanying Interim Consolidated Financial Statements have been prepared on a condensed basis in accordance with International Accounting Standards
34,
Interim Financial Reporting
of the Bank’s 2025 Annual Consolidated Financial Statements, including the accounting requirements of the Office of the Superintendent of Financial Institutions
Canada (OSFI), which were consistently applied to all periods presented. The Interim Consolidated Financial Statements are presented in Canadian dollars,
unless otherwise indicated.
Certain comparative amounts have been revised to conform with the presentation adopted in the current period.
The preparation of the Interim Consolidated Financial Statements requires that management make judgments, estimates, and assumptions regarding the
reported amount of assets, liabilities, revenue and expenses, and disclosure of contingent assets and liabilities, as further described in Note 3 of the Bank’s 2025
Annual Consolidated Financial Statements and in Note 3 of this report. Accordingly, actual results may differ from estimated amounts as future confirming events
occur.
The Bank’s Interim Consolidated Financial Statements have been prepared using uniform accounting policies for like transactions and events in similar
circumstances. All intercompany transactions, balances, and unrealized gains and losses on transactions are eliminated on consolidation.
The Interim Consolidated Financial Statements for the three and nine months ended July 31, 2026, were approved and authorized for issue by the Bank’s
Board of Directors on August 26, 2026, in accordance with a recommendation of the Audit Committee.
As the Interim Consolidated Financial Statements do not include all of the disclosures normally provided in the Annual Consolidated Financial Statements, they
should be read in conjunction with the Bank’s 2025 Annual Consolidated Financial Statements and the accompanying Notes, and the shaded sections of the 2025
Management’s Discussion and Analysis (MD&A). The risk management policies and procedures of the Bank are provided in the MD&A. The shaded sections of
the “Managing Risk” section of the MD&A in this report, relating to market, liquidity, and insurance risks, are an integral part of these Interim Consolidated Financial
Statements, as permitted by International Financial Reporting Standards.
NOTE 2: CURRENT AND FUTURE CHANGES IN ACCOUNTING POLICIES
CURRENT CHANGES IN ACCOUNTING POLICIES
There were no new accounting policies adopted by the Bank for the three and nine months ended July 31, 2026.
FUTURE CHANGES IN ACCOUNTING POLICIES
There were no new accounting standards or amendments issued during the three and nine months ended July 31, 2026. Refer to Note 4 of the Bank’s 2025
Annual Consolidated Financial Statements for a description of future changes in accounting policies.
NOTE 3: SIGNIFICANT ACCOUNTING JUDGMENTS, ESTIMATES, AND ASSUMPTIONS
The estimates used in the Bank’s accounting policies are essential to understanding its results of operations and financial condition. Some of the Bank’s policies
require subjective, complex judgments and estimates as they relate to matters that are inherently uncertain. Changes in these judgments or estimates and
changes to accounting standards and policies could have a materially adverse impact on the Bank’s Interim Consolidated Financial Statements. The Bank has
established procedures to ensure that accounting policies are applied consistently and that the processes for changing methodologies, determining estimates, and
adopting new accounting standards are well-controlled and occur in an appropriate and systematic manner. Refer to Note 3 of the Bank’s 2025 Annual
Consolidated Financial Statements for a description of significant accounting judgments, estimates, and assumptions.
Impairment – Expected Credit Loss Model
The expected credit loss (ECL) model requires the application of judgments, estimates, and assumptions in the assessment of the current and forward-looking
economic environment. There remains elevated economic uncertainty, and management continues to exercise expert credit judgment in assessing if an exposure
has experienced significant increase in credit risk since initial recognition and in determining the amount of ECLs at each reporting date. To the extent that certain
effects are not fully incorporated into the model calculations, temporary quantitative and qualitative adjustments have been applied, including for risks related to
elevated uncertainty associated with policy and trade, and such adjustments will be updated as appropriate in future periods.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 55
NOTE 4: FAIR VALUE MEASUREMENTS
There have been no significant changes to the Bank’s approach and methodologies used to determine fair value measurements for the three and nine months
ended July 31, 2026. During the three months ended July 31, 2026, to reduce an accounting mismatch from related economic hedges, the Bank designated
certain securities purchased under reverse repurchase agreements and obligations related to securities sold under repurchase agreements at fair value through
profit or loss (FVTPL). Refer to Note 2 of the Bank’s 2025 Annual Consolidated Financial Statements for further details on the designation of financial liabilities at
FVTPL.
(a)
The following table reflects the fair value of the Bank’s financial assets and liabilities not carried at fair value.
Financial Assets and Liabilities not carried at Fair Value
1
(millions of Canadian dollars)
As at
July 31, 2026
October 31, 2025
Carrying
Fair
Carrying
Fair
value
value
value
value
FINANCIAL ASSETS
Debt securities at amortized cost, net of allowance for credit losses
Government and government-related securities
$
$
$
$
Other debt securities
Total debt securities at amortized cost, net of allowance for credit losses
Total loans, net of allowance for loan losses
Total financial assets not carried at fair value
$
$
$
$
FINANCIAL LIABILITIES
Deposits
$
$
$
$
Securitization liabilities at amortized cost
Subordinated notes and debentures
Total financial liabilities not carried at fair value
$
$
$
$
1
This table excludes financial assets and liabilities where the carrying value approximates their fair value.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 56
(b)
FAIR VALUE HIERARCHY
The following table presents the levels within the fair value hierarchy for each of the assets and liabilities measured at fair value on a recurring basis as at
July 31, 2026 and October 31, 2025.
Fair Value Hierarchy for Assets and Liabilities Measured at Fair Value on a Recurring Basis
(millions of Canadian dollars)
As at
July 31, 2026
October 31, 2025
Level 1
Level 2
Level 3
Total
Level 1
Level 2
Level 3
Total
FINANCIAL ASSETS AND COMMODITIES
Trading loans, securities, and other
1
Government and government-related securities
Canadian government debt
Federal
$
$
$
$
$
$
$
$
Provinces
U.S. federal, state, municipal governments,
Other OECD
2
Mortgage-backed securities
Other debt securities
Canadian issuers
Other issuers
Equity securities
Trading loans
Commodities
Retained interests
Non-trading financial assets at fair value
through profit or loss
Securities
Loans
Derivatives
Interest rate contracts
Foreign exchange contracts
Credit contracts
Equity contracts
Commodity and other contracts
Financial assets designated at
fair value through profit or loss
Securities
1
Financial assets at fair value through other
comprehensive income
Government and government-related securities
Canadian government debt
Federal
Provinces
U.S. federal, state, municipal governments,
Other OECD government-guaranteed debt
Mortgage-backed securities
Other debt securities
Asset-backed securities
Corporate and other debt
Equity securities
Loans
Securities purchased under reverse
repurchase agreements
FINANCIAL LIABILITIES
Trading deposits
Derivatives
Interest rate contracts
Foreign exchange contracts
Credit contracts
Equity contracts
Commodity and other contracts
Securitization liabilities at fair value
Financial liabilities designated at fair value
through profit or loss
Obligations related to securities sold short
1
Obligations related to securities sold
under repurchase agreements
1
Balances reflect the reduction of securities owned (long positions) by the amount of identical securities sold but not yet purchased (short positions).
2
Organisation for Economic Co-operation and Development (OECD).
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 57
(c)
The Bank’s policy is to record transfers of assets and liabilities between the different levels of the fair value hierarchy using the fair values as at the end of each
reporting period. Assets and liabilities are transferred between Level 1 and Level 2 depending on whether there is sufficient frequency and volume in an active
market.
Transfers Between Fair Value Hierarchy Levels
(millions of Canadian dollars)
For the three months ended
July 31, 2026
July 31, 2025
Level 1 to Level 2
Level 2 to Level 1
Level 1 to Level 2
Level 2 to Level 1
Trading loans, securities, and other
$
$
$
$
Financial assets at fair value through other comprehensive
income
Obligations related to securities sold short
For the nine months ended
July 31, 2026
July 31, 2025
Level 1 to Level 2
Level 2 to Level 1
Level 1 to Level 2
Level 2 to Level 1
Trading loans, securities, and other
$
$
$
$
Financial assets at fair value through other comprehensive
income
Obligations related to securities sold short
There were no significant transfers between Level 2 and Level 3 during the three and nine months ended July 31, 2026 and July 31, 2025.
There were no significant changes to the unobservable inputs and sensitivities for assets and liabilities classified as Level 3 during the three and nine months
ended July 31, 2026 and July 31, 2025.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 58
(d)
RECONCILIATION OF CHANGES IN FAIR VALUE FOR LEVEL 3 ASSETS AND LIABILITIES
The following tables set out changes in fair value of all assets and liabilities measured at fair value using significant Level 3 unobservable inputs for the three and
nine months ended July 31, 2026 and July 31, 2025.
Reconciliation of Changes in Fair Value for Level 3 Assets and Liabilities
(millions of Canadian dollars)
Change in
unrealized
Fair
Total realized and
Fair
gains
value as at
unrealized gains (losses)
Movements
1
Transfers
value as at
(losses) on
May 1
Included
Included
Purchases/
Sales/
Into
Out of
July 31
instruments
2026
in income
2
in OCI
3,4
Issuances
Settlements
Level 3
Level 3
2026
still held
5
FINANCIAL ASSETS
Trading loans, securities,
and other
Other debt securities
$
$
$
$
$
$
$
$
$
Equity securities
(19 )
Trading loans
(43 )
(42 )
(15 )
Non-trading financial
assets at fair value
through profit or loss
Securities
(38 )
(2 )
Loans
(38 )
(2 )
Financial assets at fair value
through other
comprehensive income
Other debt securities
Equity securities
(9 )
$
$
$
$
$
(9 )
$
$
$
$
FINANCIAL LIABILITIES
Trading deposits
6
$
(158 )
$
(3 )
$
$
(16 )
$
$
$
(121 )
$
(265 )
$
Derivatives
7
Interest rate contracts
(77 )
(64 )
(8 )
Foreign exchange contracts
(1 )
(3 )
(2 )
Equity contracts
(107 )
Commodity and other contracts
(12 )
(5 )
(18 )
(18 )
(149 )
(3 )
(3 )
(54 )
Financial liabilities designated
at fair value through profit
or loss
(4 )
(3 )
(4 )
(3 )
Change in
unrealized
Fair
Total realized and
Fair
gains
value as at
unrealized gains (losses)
Movements
1
Transfers
value as at
(losses) on
November 1
Included
Included
Purchases/
Sales/
Into
Out of
July 31
instruments
2025
in income
2
in OCI
4
Issuances
Settlements
Level 3
Level 3
2026
still held
5
FINANCIAL ASSETS
Trading loans, securities,
and other
Other debt securities
$
$
(1 )
$
$
$
(18 )
$
$
(1 )
$
$
(4 )
Equity securities
(19 )
Trading loans
(166 )
(166 )
(37 )
(1 )
(4 )
Non-trading financial
assets at fair value
through profit or loss
Securities
(236 )
(2 )
Loans
(236 )
(2 )
Financial assets at fair value
through other
comprehensive income
Other debt securities
Equity securities
(97 )
$
$
$
$
$
(97 )
$
$
$
$
FINANCIAL LIABILITIES
Trading deposits
6
$
(273 )
$
$
$
(22 )
$
$
$
(113 )
$
(265 )
$
Derivatives
7
Interest rate contracts
(68 )
(64 )
(3 )
Foreign exchange contracts
(2 )
(3 )
(2 )
(2 )
Equity contracts
(155 )
(5 )
Commodity and other contracts
(55 )
(6 )
(18 )
(280 )
(7 )
(54 )
Financial liabilities designated
at fair value through profit
or loss
(2 )
(5 )
(13 )
(3 )
(9 )
1
Includes foreign exchange.
2
3
4
5
6
7
(April 30, 2026/May 1, 2026 – $
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 59
Reconciliation of Changes in Fair Value for Level 3 Assets and Liabilities
(millions of Canadian dollars)
Change in
unrealized
Fair
Total realized and
Fair
gains
value as at
unrealized gains (losses)
Movements
1
Transfers
value as at
(losses) on
May 1
Included
Included
Purchases/
Sales/
Into
Out of
July 31
instruments
2025
in income
2
in OCI
3
Issuances
Settlements
Level 3
Level 3
2025
still held
4
FINANCIAL ASSETS
Trading loans, securities,
and other
Other debt securities
$
$
(1 )
$
$
$
(1 )
$
$
(2 )
$
$
(1 )
Equity securities
(1 )
(1 )
(2 )
(1 )
Non-trading financial
assets at fair value
through profit or loss
Securities
(11 )
(11 )
Financial assets at fair value
through other
comprehensive income
Other debt securities
Equity securities
(659 )
$
$
$
$
$
(659 )
$
$
$
$
FINANCIAL LIABILITIES
Trading deposits
5
$
(384 )
$
$
$
(45 )
$
$
$
$
(398 )
$
Derivatives
6
Interest rate contracts
(81 )
(64 )
(5 )
Foreign exchange contracts
(1 )
(1 )
(1 )
Equity contracts
(131 )
(3 )
(1 )
(132 )
(4 )
Commodity and other contracts
(20 )
(233 )
(1 )
(182 )
Financial liabilities designated
at fair value through profit
or loss
(1 )
(5 )
(2 )
Change in
unrealized
Fair
Total realized and
Fair
gains
value as at
unrealized gains (losses)
Movements
1
Transfers
value as at
(losses) on
November 1
Included
Included
Purchases/
Sales/
Into
Out of
July 31
instruments
2024
in income
2
in OCI
3
Issuances
Settlements
Level 3
Level 3
2025
still held
4
FINANCIAL ASSETS
Trading loans, securities,
and other
Other debt securities
$
$
(1 )
$
$
$
(23 )
$
$
(2 )
$
$
(2 )
Equity securities
(7 )
(1 )
(30 )
(2 )
(3 )
Non-trading financial
assets at fair value
through profit or loss
Securities
(47 )
(10 )
(16 )
(47 )
(10 )
(16 )
Financial assets at fair value
through other
comprehensive income
Other debt securities
(7 )
Equity securities
(1,211 )
$
$
$
$
$
(1,218 )
$
$
$
$
FINANCIAL LIABILITIES
Trading deposits
5
$
(505 )
$
$
$
(169 )
$
$
$
$
(398 )
$
Derivatives
6
Interest rate contracts
(158 )
(64 )
Foreign exchange contracts
(13 )
Equity contracts
(24 )
(106 )
(3 )
(2 )
(132 )
(106 )
Commodity and other contracts
(10 )
(191 )
(14 )
(182 )
Financial liabilities designated
at fair value through profit
or loss
(24 )
(19 )
(2 )
1
Includes foreign exchange.
2
3
4
5
6
(April 30, 2025/May 1, 2025 – $
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 60
NOTE 5: SECURITIES
(a)
UNREALIZED SECURITIES GAINS (LOSSES)
The following table summarizes the unrealized gains and losses as at July 31, 2026 and October 31, 2025.
Unrealized Gains (Losses) for Securities at Fair Value Through Other Comprehensive Income
(millions of Canadian dollars)
As at
July 31, 2026
October 31, 2025
Cost/
Gross
Gross
Cost/
Gross
Gross
amortized
unrealized
unrealized
Fair
amortized
unrealized
unrealized
Fair
cost
1
gains
(losses)
value
cost
1
gains
(losses)
value
Government and government-related
securities
Canadian government debt
Federal
$
$
$
(55 )
$
$
$
$
(88 )
$
Provinces
(41 )
(11 )
U.S. federal, state, municipal governments, and
(185 )
(54 )
Other OECD government-guaranteed debt
(12 )
(4 )
Mortgage-backed securities
(1 )
(2 )
(294 )
(159 )
Other debt securities
Asset-backed securities
(9 )
(15 )
Corporate and other debt
(34 )
(26 )
(43 )
(41 )
Total debt securities
(337 )
(200 )
Equity securities
Common shares
(32 )
(22 )
Preferred shares
(79 )
(79 )
(111 )
(101 )
Total securities at fair value through
$
$
$
(448 )
$
$
$
$
(301 )
$
1
Includes the foreign exchange translation of amortized cost balances at the period-end spot rate.
(b)
EQUITY SECURITIES DESIGNATED AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME
The Bank designated certain equity securities at FVOCI.
The following table summarizes the fair value of equity securities designated at FVOCI as at
July 31, 2026 and October 31, 2025, and dividend income recognized on these securities for the three and nine months ended July 31, 2026 and July 31, 2025.
Equity Securities Designated at Fair Value Through Other Comprehensive Income
(millions of Canadian dollars)
As at
For the three months ended
For the nine months ended
July 31, 2026
October 31, 2025
July 31, 2026
July 31, 2025
July 31, 2026
July 31, 2025
Fair value
Dividend income recognized
Dividend income recognized
Common shares
$
$
$
$
$
$
Preferred shares
Total
$
$
$
$
$
$
The Bank disposed of certain equity securities in line with the Bank’s investment strategy and disposed of Federal Home Loan Bank (FHLB) stock in accordance
with FHLB member stockholding requirements, as follows:
Equity Securities Net Realized Gains (Losses)
(millions of Canadian dollars)
For the three months ended
For the nine months ended
July 31, 2026
July 31, 2025
July 31, 2026
July 31, 2025
Equity Securities
Fair value
$
$
$
$
Cumulative realized gain/(loss)
(5 )
FHLB Stock
Fair value
Cumulative realized gain/(loss)
(c)
DEBT SECURITIES NET REALIZED GAINS (LOSSES)
The Bank disposed of certain debt securities measured at amortized cost and FVOCI during the quarter.
The following table summarizes the net realized gains
and losses on securities disposed of during the three and nine months ended July 31, 2026 and July 31, 2025, which are included in Other income (loss) on the
Interim Consolidated Statement of Income.
Debt Securities Net Realized Gains (Losses)
(millions of Canadian dollars)
For the three months ended
For the nine months ended
July 31, 2026
July 31, 2025
1
July 31, 2026
July 31, 2025
1
Debt securities at amortized cost
$
$
(337 )
$
$
(1,533 )
Debt securities at fair value through other comprehensive income
(35 )
(41 )
Total
$
$
(372 )
$
$
(1,574 )
1
Includes $
to the balance sheet restructuring initiative undertaken in the U.S. Banking segment. Refer to Note 25 of the Bank ’s 2025 Annual Consolidated Financial Statements for additional
information regarding the asset limitation on TD’s two U.S. bank subsidiaries.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 61
(d)
CREDIT QUALITY OF DEBT SECURITIES
The Bank evaluates non-retail credit risk on an individual borrower basis, using both a borrower risk rating (BRR) and facility risk rating, as detailed in the shaded
area of the “Managing Risk” section of the 2025 MD&A. This system is used to assess all non-retail exposures, including debt securities.
The following table provides the gross carrying amounts of debt securities measured at amortized cost and debt securities at FVOCI by internal risk rating for credit
risk management purposes, presenting separately those debt securities that are subject to Stage 1, Stage 2, and Stage 3 allowances. Refer to the “Allowance for
Credit Losses” table in Note 6 for details regarding the allowance and provision for credit losses on debt securities.
Debt Securities by Risk Rating
(millions of Canadian dollars)
As at
July 31, 2026
October 31, 2025
Stage 1
Stage 2
Stage 3
Total
Stage 1
Stage 2
Stage 3
Total
Debt securities
1
Investment grade
$
$
$
n/a
2
$
$
$
$
n/a
$
Non-investment grade
n/a
n/a
Watch and classified
n/a
n/a
n/a
n/a
Default
n/a
n/a
n/a
n/a
Total debt securities
Allowance for credit losses on debt securities
at amortized cost
Total debt securities, net of allowance
$
$
$
$
$
$
$
$
1
Includes debt securities backed by government-guaranteed loans of $
on the issuer’s credit risk.
2
As at July 31, 2026, total debt securities, net of allowance, in the table above, include debt securities measured at amortized cost, net of allowance, of
$
difference between probability-weighted ECLs and base ECLs on debt securities at amortized cost and at FVOCI as at both July 31, 2026 and October 31, 2025,
was insignificant.
NOTE 6: LOANS, IMPAIRED LOANS, AND ALLOWANCE FOR CREDIT LOSSES
(a)
LOANS
The following table provides details regarding the Bank’s loans as at July 31, 2026 and October 31, 2025.
Loans
(millions of Canadian dollars)
As at
July 31, 2026
October 31, 2025
Residential mortgages
$
$
Consumer instalment and other personal
Credit card
Business and government
Loans at FVOCI
1
Total loans
Total allowance for loan losses
Total loans, net of allowance
$
$
1
Included in Financial assets at fair value through other comprehensive income on the Interim Consolidated Balance Sheet.
Business and government loans and loans at FVOCI are grouped together as reflected below for presentation in the “Loans by Risk Ratings” table.
Loans – Business and Government
(millions of Canadian dollars)
As at
July 31, 2026
October 31, 2025
Loans at amortized cost
$
$
Loans at FVOCI
1
Loans
Allowance for loan losses
Loans, net of allowance
$
$
1
Included in Financial assets at fair value through other comprehensive income on the Interim Consolidated Balance Sheet.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 62
(b)
CREDIT QUALITY OF LOANS
In the retail portfolio, including individuals and small businesses, the Bank manages exposures on a pooled basis, using predictive credit scoring techniques. For
non-retail exposures, each borrower is assigned a BRR that reflects the probability of default (PD) of the borrower using proprietary industry and sector specific
risk models and expert judgment. Refer to the shaded areas of the “Managing Risk” section of the 2025 MD&A for further details, including the mapping of PD
ranges to risk levels for retail exposures as well as the Bank’s 21-point BRR scale to risk levels and external ratings for non-retail exposures.
The following table provides the gross carrying amounts of loans and credit risk exposures on loan commitments and financial guarantee contracts by internal risk
rating for credit risk management purposes, presenting separately those that are subject to Stage 1, Stage 2, and Stage 3 allowances.
Loans by Risk Rating
(millions of Canadian dollars)
As at
July 31, 2026
October 31, 2025
Stage 1
Stage 2
Stage 3
Total
Stage 1
Stage 2
Stage 3
Total
Residential mortgages
1,2,3
Low Risk
$
$
$
n/a
$
$
$
$
n/a
$
Normal Risk
n/a
n/a
Medium Risk
n/a
n/a
High Risk
Default
n/a
n/a
n/a
n/a
Total loans
Allowance for loan losses
Loans, net of allowance
Consumer instalment and other personal
4
Low Risk
n/a
n/a
Normal Risk
n/a
n/a
Medium Risk
n/a
n/a
High Risk
Default
n/a
n/a
n/a
n/a
Total loans
Allowance for loan losses
Loans, net of allowance
Credit card
Low Risk
n/a
n/a
Normal Risk
n/a
n/a
Medium Risk
n/a
n/a
High Risk
Default
n/a
n/a
n/a
n/a
Total loans
Allowance for loan losses
Loans, net of allowance
Business and government
1,2,3,5
Investment grade or Low/Normal Risk
n/a
n/a
Non-investment grade or Medium Risk
n/a
n/a
Watch and classified or High Risk
Default
n/a
n/a
n/a
n/a
Total loans
Allowance for loan losses
Loans, net of allowance
Total loans
Total allowance for loan losses
Total loans, net of allowance
$
$
$
$
$
$
$
$
1
Includes impaired loans with a balance of $
exceeded the loan amount.
2
Excludes trading loans and non-trading loans at FVTPL with a fair value of $
3
Includes insured mortgages of $
4
5
Includes loans guaranteed by government agencies of $
the borrowers’ credit risk.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 63
Loans by Risk Rating
(Continued)
1
(millions of Canadian dollars)
As at
July 31, 2026
October 31, 2025
Stage 1
Stage 2
Stage 3
Total
Stage 1
Stage 2
Stage 3
Total
Retail Exposures
2
Low Risk
$
$
$
n/a
$
$
$
$
n/a
$
Normal Risk
n/a
n/a
Medium Risk
n/a
n/a
High Risk
Default
n/a
n/a
n/a
n/a
Non-Retail Exposures
3
Investment grade
n/a
n/a
Non-investment grade
n/a
n/a
Watch and classified
Default
n/a
n/a
n/a
n/a
Total off-balance sheet credit
instruments
Allowance for off-balance sheet credit
instruments
Total off-balance sheet credit
instruments, net of allowance
$
$
$
$
$
$
$
$
1
Excludes mortgage commitments.
2
3
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 64
(c)
ALLOWANCE FOR CREDIT LOSSES
The following table provides details on the Bank’s allowance for credit losses as at and for the three and nine months ended July 31, 2026 and July 31, 2025,
including allowance for off-balance sheet instruments in the applicable categories.
Allowance for Credit Losses
(millions of Canadian dollars)
Foreign
Foreign
exchange,
exchange,
Balance at
Provision
Write-offs,
disposals,
Balance
Balance at
Provision
Write-offs,
disposals,
Balance
beginning
for credit
net of
and other
at end of
beginning
for credit
net of
and other
at end of
of period
losses
recoveries
adjustments
period
of period
losses
recoveries
adjustments
period
For the three months ended
July 31, 2026
July 31, 2025
Residential mortgages
$
$
$
(4 )
$
$
$
$
$
(5 )
$
$
Consumer instalment and other
personal
(342 )
(293 )
Credit card
(436 )
(394 )
Business and government
(187 )
(141 )
(31 )
Total allowance for loan losses,
including off-balance sheet
instruments
(969 )
(833 )
(22 )
Debt securities at amortized cost
(1 )
(1 )
Debt securities at FVOCI
Total allowance for credit
losses on debt securities
(1 )
(1 )
Total allowance for credit losses
$
$
$
(969 )
$
$
$
$
$
(833 )
$
(22 )
$
Comprising:
Allowance for credit losses on
loans at amortized cost
$
$
$
$
Allowance for credit losses on
loans at FVOCI
Allowance for loan losses
Allowance for off-balance sheet
instruments
Allowance for credit losses on
debt securities
For the nine months ended
July 31, 2026
July 31, 2025
Residential mortgages
$
$
$
(8 )
$
$
$
$
(14 )
$
(6 )
$
$
Consumer instalment and other
personal
(1,003 )
(934 )
(4 )
Credit card
(1,267 )
(1,265 )
(8 )
Business and government
(817 )
(51 )
(687 )
(56 )
Total allowance for loan losses,
including off-balance sheet
instruments
(3,095 )
(49 )
(2,892 )
(68 )
Debt securities at amortized cost
(1 )
(1 )
Debt securities at FVOCI
Total allowance for credit
losses on debt securities
Total allowance for credit losses
$
$
$
(3,095 )
$
(48 )
$
$
$
$
(2,892 )
$
(68 )
$
Comprising:
Allowance for credit losses on
loans at amortized cost
$
$
$
$
Allowance for credit losses on
loans at FVOCI
Allowance for loan losses
Allowance for off-balance sheet
instruments
Allowance for credit losses on
debt securities
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 65
(d)
ALLOWANCE FOR LOAN LOSSES BY STAGE
The following table provides details on the Bank’s allowance for loan losses by stage as at and for the three months ended July 31, 2026 and July 31, 2025.
Allowance for Loan Losses by Stage
(millions of Canadian dollars)
For the three months ended
July 31, 2026
July 31, 2025
Stage 1
Stage 2
Stage 3
Total
Stage 1
Stage 2
Stage 3
Total
Residential Mortgages
Balance at beginning of period
$
$
$
$
$
$
$
$
Provision for credit losses
Transfer to Stage 1
1
(31 )
(2 )
(27 )
(1 )
Transfer to Stage 2
(19 )
(8 )
(7 )
(8 )
Transfer to Stage 3
(16 )
(13 )
Net remeasurement due to transfers into stage
2
(8 )
(4 )
(7 )
(3 )
New originations or purchases
3
n/a
n/a
n/a
n/a
Net repayments
4
(1 )
(1 )
(2 )
(1 )
(1 )
(2 )
Derecognition of financial assets (excluding
disposals and write-offs)
5
(2 )
(12 )
(11 )
(25 )
(3 )
(5 )
(8 )
(16 )
Changes to risk, parameters, and models
6
(15 )
(22 )
Disposals
Write-offs
(4 )
(4 )
(5 )
(5 )
Recoveries
Foreign exchange and other adjustments
Balance at end of period
$
$
$
$
$
$
$
$
Consumer Instalment and Other Personal
Balance, including off-balance sheet instruments,
at beginning of period
$
$
$
$
$
$
$
$
Provision for credit losses
Transfer to Stage 1
1
(258 )
(1 )
(212 )
(1 )
Transfer to Stage 2
(55 )
(21 )
(54 )
(23 )
Transfer to Stage 3
(3 )
(75 )
(2 )
(71 )
Net remeasurement due to transfers into stage
2
(123 )
(56 )
(91 )
(22 )
New originations or purchases
3
n/a
n/a
n/a
n/a
Net repayments
4
(31 )
(26 )
(9 )
(66 )
(23 )
(27 )
(5 )
(55 )
Derecognition of financial assets (excluding
disposals and write-offs)
5
(24 )
(29 )
(11 )
(64 )
(22 )
(29 )
(16 )
(67 )
Changes to risk, parameters, and models
6
(87 )
(79 )
Disposals
Write-offs
(425 )
(425 )
(385 )
(385 )
Recoveries
Foreign exchange and other adjustments
Balance, including off-balance sheet instruments,
at end of period
Less: Allowance for off-balance sheet instruments
7
Balance at end of period
$
$
$
$
$
$
$
$
Credit Card
8
Balance, including off-balance sheet instruments,
at beginning of period
$
$
$
$
$
$
$
$
Provision for credit losses
Transfer to Stage 1
1
(280 )
(9 )
(269 )
(11 )
Transfer to Stage 2
(77 )
(28 )
(88 )
(25 )
Transfer to Stage 3
(6 )
(243 )
(7 )
(240 )
Net remeasurement due to transfers into stage
2
(115 )
(98 )
New originations or purchases
3
n/a
n/a
n/a
n/a
Net repayments
4
(1 )
(13 )
Derecognition of financial assets (excluding
disposals and write-offs)
5
(15 )
(27 )
(110 )
(152 )
(13 )
(31 )
(61 )
(105 )
Changes to risk, parameters, and models
6
(121 )
(125 )
Disposals
Write-offs
(540 )
(540 )
(497 )
(497 )
Recoveries
Foreign exchange and other adjustments
Balance, including off-balance sheet instruments,
at end of period
Less: Allowance for off-balance sheet instruments
7
Balance at end of period
$
$
$
$
$
$
$
$
1
Transfers represent stage transfer movements prior to ECL remeasurement.
2
described in the “Significant Increase in Credit Risk” section of Note 2 and Note 3 of the Bank’s 2025 Annual Consolidated Financial Statements, holding all other factors impacting the
change in ECLs constant.
3
4
5
6
subsequent to stage migration. Refer to the “Measurement of Expected Credit Losses”, “Forward-Looking Information ” and “Expert Credit Judgment” sections of Note 2 and Note 3 of the
Bank’s 2025 Annual Consolidated Financial Statements for further details.
7
8
Consolidated Financial Statements for further details.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 66
Allowance for Loan Losses by Stage
(Continued)
(millions of Canadian dollars)
For the three months ended
July 31, 2026
July 31, 2025
Stage 1
Stage 2
Stage 3
Total
Stage 1
Stage 2
Stage 3
Total
Business and Government
Balance, including off-balance sheet instruments,
at beginning of period
$
$
$
$
$
$
$
$
Provision for credit losses
Transfer to Stage 1
1
(111 )
(122 )
(1 )
Transfer to Stage 2
(172 )
(4 )
(203 )
(11 )
Transfer to Stage 3
(2 )
(41 )
(2 )
(181 )
Net remeasurement due to transfers into stage
1
(28 )
(29 )
(1 )
New originations or purchases
1
n/a
n/a
n/a
n/a
Net repayments
1
(8 )
(30 )
(27 )
(30 )
(26 )
Derecognition of financial assets (excluding
disposals and write-offs)
1
(226 )
(219 )
(110 )
(555 )
(217 )
(314 )
(121 )
(652 )
Changes to risk, parameters, and models
1
(83 )
(4 )
Disposals
(13 )
(13 )
Write-offs
(221 )
(221 )
(158 )
(158 )
Recoveries
Foreign exchange and other adjustments
(5 )
(20 )
(18 )
Balance, including off-balance sheet instruments,
at end of period
Less: Allowance for off-balance sheet instruments
2
Balance at end of period
Total Allowance, including off-balance sheet
instruments, at end of period
Less: Total Allowance for off-balance sheet
instruments
2
Total Allowance for Loan Losses at end of period
$
$
$
$
$
$
$
$
1
For explanations regarding this line item, refer to the “Allowance for Loan Losses by Stage” table on the previous page in this Note.
2
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 67
The following table provides details on the Bank’s allowance for loan losses by stage as at and for the nine months ended July 31, 2026 and July 31, 2025.
Allowance for Loan Losses by Stage
(millions of Canadian dollars)
For the nine months ended
July 31, 2026
July 31, 2025
Stage 1
Stage 2
Stage 3
Total
Stage 1
Stage 2
Stage 3
Total
Residential Mortgages
Balance at beginning of period
$
$
$
$
$
$
$
$
Provision for credit losses
Transfer to Stage 1
1
(75 )
(5 )
(81 )
(4 )
Transfer to Stage 2
(40 )
(23 )
(20 )
(23 )
Transfer to Stage 3
(36 )
(32 )
Net remeasurement due to transfers into stage
2
(19 )
(6 )
(19 )
(7 )
New originations or purchases
3
n/a
n/a
n/a
n/a
Net repayments
4
(3 )
(3 )
(6 )
(3 )
(3 )
(6 )
Derecognition of financial assets (excluding
disposals and write-offs)
5
(4 )
(22 )
(29 )
(55 )
(12 )
(15 )
(21 )
(48 )
Changes to risk, parameters, and models
6
(37 )
(65 )
Disposals
Write-offs
(11 )
(11 )
(7 )
(7 )
Recoveries
Foreign exchange and other adjustments
(1 )
Balance at end of period
$
$
$
$
$
$
$
$
Consumer Instalment and Other Personal
Balance, including off-balance sheet instruments,
at beginning of period
$
$
$
$
$
$
$
$
Provision for credit losses
Transfer to Stage 1
1
(643 )
(4 )
(533 )
(4 )
Transfer to Stage 2
(180 )
(63 )
(178 )
(71 )
Transfer to Stage 3
(9 )
(232 )
(7 )
(220 )
Net remeasurement due to transfers into stage
2
(289 )
(74 )
(234 )
(13 )
New originations or purchases
3
n/a
n/a
n/a
n/a
Net repayments
4
(77 )
(80 )
(18 )
(175 )
(65 )
(81 )
(13 )
(159 )
Derecognition of financial assets (excluding
disposals and write-offs)
5
(69 )
(84 )
(35 )
(188 )
(64 )
(86 )
(36 )
(186 )
Changes to risk, parameters, and models
6
(255 )
(227 )
Disposals
Write-offs
(1,247 )
(1,247 )
(1,196 )
(1,196 )
Recoveries
Foreign exchange and other adjustments
(1 )
(3 )
(4 )
Balance, including off-balance sheet instruments,
at end of period
Less: Allowance for off-balance sheet instruments
7
Balance at end of period
$
$
$
$
$
$
$
$
Credit Card
8
Balance, including off-balance sheet instruments,
at beginning of period
$
$
$
$
$
$
$
$
Provision for credit losses
Transfer to Stage 1
1
(794 )
(28 )
(967 )
(33 )
Transfer to Stage 2
(260 )
(77 )
(256 )
(69 )
Transfer to Stage 3
(22 )
(787 )
(18 )
(768 )
Net remeasurement due to transfers into stage
2
(325 )
(398 )
(35 )
New originations or purchases
3
n/a
n/a
n/a
n/a
Net repayments
4
(1 )
(7 )
Derecognition of financial assets (excluding
disposals and write-offs)
5
(38 )
(83 )
(333 )
(454 )
(49 )
(74 )
(240 )
(363 )
Changes to risk, parameters, and models
6
(306 )
(400 )
Disposals
Write-offs
(1,598 )
(1,598 )
(1,558 )
(1,558 )
Recoveries
Foreign exchange and other adjustments
(3 )
(2 )
(3 )
(8 )
Balance, including off-balance sheet instruments,
at end of period
Less: Allowance for off-balance sheet instruments
7
Balance at end of period
$
$
$
$
$
$
$
$
1
Transfers represent stage transfer movements prior to ECL remeasurement.
2
described in the “Significant Increase in Credit Risk” section of Note 2 and Note 3 of the Bank’s 2025 Annual Consolidated Financial Statements, holding all other factors impacting the
change in ECLs constant.
3
4
5
6
subsequent to stage migration. Refer to the “Measurement of Expected Credit Losses”, “Forward-Looking Information ” and “Expert Credit Judgment” sections of Note 2 and Note 3 of the
Bank’s 2025 Annual Consolidated Financial Statements for further details.
7
8
Consolidated Financial Statements for further details.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 68
Allowance for Loan Losses by Stage
(Continued)
(millions of Canadian dollars)
For the nine months ended
July 31, 2026
July 31, 2025
Stage 1
Stage 2
Stage 3
Total
Stage 1
Stage 2
Stage 3
Total
Business and Government
Balance, including off-balance sheet instruments,
at beginning of period
$
$
$
$
$
$
$
$
Provision for credit losses
Transfer to Stage 1
1
(285 )
(273 )
(4 )
Transfer to Stage 2
(455 )
(11 )
(517 )
(31 )
Transfer to Stage 3
(6 )
(254 )
(6 )
(405 )
Net remeasurement due to transfers into stage
1
(87 )
(75 )
New originations or purchases
1
n/a
n/a
n/a
n/a
Net repayments
1
(85 )
(174 )
(241 )
(22 )
(116 )
(121 )
Derecognition of financial assets (excluding
disposals and write-offs)
1
(698 )
(668 )
(398 )
(1,764 )
(546 )
(709 )
(243 )
(1,498 )
Changes to risk, parameters, and models
1
(218 )
Disposals
(27 )
(27 )
(22 )
(22 )
Write-offs
(884 )
(884 )
(743 )
(743 )
Recoveries
Foreign exchange and other adjustments
(36 )
(24 )
(12 )
(31 )
(34 )
Balance, including off-balance sheet instruments,
at end of period
Less: Allowance for off-balance sheet instruments
2
Balance at end of period
Total Allowance, including off-balance sheet
instruments, at end of period
Less: Total Allowance for off-balance sheet
instruments
2
Total Allowance for Loan Losses at end of period
$
$
$
$
$
$
$
$
1
For explanations regarding this line item, refer to the “Allowance for Loan Losses by Stage” table on the previous page in this Note.
2
The allowance for credit losses on all remaining financial assets is not significant.
(e)
Relevant macroeconomic factors are incorporated in risk parameters as appropriate. Additional risk factors that are industry or segment specific are also
incorporated, where relevant. The key macroeconomic variables used in determining ECLs include regional unemployment rates for all retail exposures and
regional housing price indices for residential mortgages and home equity lines of credit. For business and government loans, the key macroeconomic variables
include gross domestic product (GDP), unemployment rates, interest rates, and credit spreads. Refer to Note 3 of the Bank’s 2025 Annual Consolidated Financial
Statements for a discussion of how forward-looking information is generated and considered in determining whether there has been a significant increase in credit
risk and in measuring ECLs.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 69
Macroeconomic Variables
Select macroeconomic variables are projected over the forecast period.
The following table sets out average values of the macroeconomic variables over the four
calendar quarters starting with the current quarter, and the remaining 4-year forecast period for the base forecast and upside and downside scenarios used in
determining the Bank’s ECLs as at July 31, 2026. As the forecast period increases, information about the future becomes less readily available and projections are
anchored on assumptions around structural relationships between economic parameters that are inherently much less certain. Economic uncertainty remains
elevated amid several key risks affecting the outlook, most notably the conflict in the Middle East and the ongoing U.S.-Canada trade negotiations. Further trade
escalation or a prolonged Middle East conflict that results in renewed upward pressure on global energy prices pose downside risks to the economic outlook.
However, the Bank’s Canadian and U.S. downside scenarios already incorporate recession risks through the allowance process.
Macroeconomic Variables
As at
July 31, 2026
Base Forecast
Upside Scenario
Downside Scenario
Average
Remaining
Average
Remaining
Average
Remaining
Q3 2026-
4-year
Q3 2026-
4-year
Q3 2026-
4-year
Q2 2027
1
period
1
Q2 2027
1
period
1
Q2 2027
1
period
1
Unemployment rate
Canada
%
%
%
%
%
%
United States
Real GDP
Canada
(0.8 )
United States
(0.3 )
Home prices
Canada (average existing price)
2
(4.1 )
United States (CoreLogic HPI)
3
(6.0 )
Central bank policy interest rate
Canada
United States
U.S. 10-year treasury yield
U.S. 10-year BBB spread (%-pts)
Exchange rate (U.S. dollar/Canadian dollar)
$
$
$
$
$
$
1
The numbers represent average values for the quoted periods and the average of year-on-year growth for real GDP and home prices.
2
3
(f)
ECLs are sensitive to the inputs used in internally developed models, the macroeconomic variables in the forward-looking forecasts and respective probability
weightings in determining the probability-weighted ECLs, and other factors considered when applying expert credit judgment. Changes in these inputs,
assumptions, models, and judgments would affect the assessment of significant increase in credit risk and the measurement of ECLs.
The following table presents the base ECL scenario compared to the probability-weighted ECLs, with the latter derived from three ECL scenarios for performing
loans and off-balance sheet instruments. The difference reflects the impact of deriving multiple scenarios around the base ECLs and resultant change in ECLs due
to non-linearity and sensitivity to using macroeconomic forecasts.
Change from Base to Probability-Weighted ECLs
(millions of Canadian dollars, except as noted)
As at
July 31, 2026
October 31, 2025
Probability-weighted ECLs
$
$
Base ECLs
Difference – in amount
$
$
Difference – in percentage
%
%
ECLs for performing loans and off-balance sheet instruments consist of an aggregate amount of Stage 1 and Stage 2 probability-weighted ECLs which are twelve-
month ECLs and lifetime ECLs, respectively. Transfers from Stage 1 to Stage 2 ECLs result from a significant increase in credit risk since initial recognition.
The
following table shows the estimated impact of staging on ECLs by presenting all performing loans and off-balance sheet instruments calculated using twelve-month
ECLs compared to the current aggregate probability-weighted ECLs, holding all risk profiles constant.
Incremental Lifetime ECLs Impact
(millions of Canadian dollars)
As at
July 31, 2026
October 31, 2025
Probability-weighted ECLs
$
$
All performing loans and off-balance sheet instruments using 12-month ECLs
Incremental lifetime ECLs impact
$
$
(g)
Foreclosed assets are repossessed non-financial assets where the Bank gains title, ownership, or possession of individual properties, such as real estate
properties, which are managed for sale in an orderly manner with the proceeds used to reduce or repay any outstanding debt. The Bank does not generally occupy
foreclosed properties for its business use. The Bank predominantly relies on third-party appraisals to determine the carrying value of foreclosed assets. Foreclosed
assets held for sale were $
Sheet.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 70
(h)
A loan is classified as past due when a borrower has failed to make a payment by the contractual due date.
The following table summarizes loans that are past
due but not impaired. Loans less than 31 days contractually past due are excluded as they do not generally reflect a borrower’s ability to meet their payment
obligations.
Loans Past Due but not Impaired
1
(millions of Canadian dollars)
As at
July 31, 2026
October 31, 2025
31-60
61-89
31-60
61-89
days
days
Total
days
days
Total
Residential mortgages
$
$
$
$
$
$
Consumer instalment and other personal
Credit card
Business and government
Total
$
$
$
$
$
$
1
Includes loans that are measured at FVOCI.
NOTE 7: INVESTMENTS IN ASSOCIATES AND JOINT VENTURES
INVESTMENT IN THE CHARLES SCHWAB CORPORATION
On February 12, 2025, the Bank sold its entire remaining equity investment in The Charles Schwab Corporation (“Schwab”) through a registered offering and
share repurchase by Schwab. Immediately prior to the sale, TD held
% economic ownership.
The sale of the shares resulted in proceeds of approximately $
$
items, and direct transaction costs. For segment reporting, the Bank recognized an after-tax gain of $
underwriting fees in its Wholesale segment as a result of TD Securities acting as a lead bookrunner on the transaction. In the second quarter of fiscal 2026, the
Bank revised its estimate of taxes owed on the gain from its disposition of Schwab shares, which increased the Bank's after-tax gain to $
15 for further details.
The Bank discontinued recording its share of earnings available to common shareholders from its investment in Schwab following the sale. Prior to the sale, the
Bank accounted for its investment in Schwab using the equity method. The Bank’s share of Schwab’s earnings available to common shareholders was reported
with a one-month lag. The Bank’s share of net income from its prior investment in Schwab of $
income after adjustments for amortization of certain intangibles net of tax.
The Stockholder Agreement was terminated by the Bank’s sale of its equity investment in Schwab. The Bank continues to have a business relationship with
Schwab through the insured deposit account agreement (“Schwab IDA Agreement”).
INSURED DEPOSIT ACCOUNT AGREEMENT
On May 4, 2023, the Bank and Schwab entered into an amended Schwab IDA Agreement, with an initial expiration of July 1, 2034. Pursuant to the Schwab IDA
Agreement, the Bank makes sweep deposit accounts available to clients of Schwab. Schwab designates a portion of the deposits with the Bank as fixed-rate
obligation amounts. Remaining deposits are designated as floating-rate obligations. The IDA deposit floor is set at US$
Refer to Note 26 of the Bank’s 2025 Annual Consolidated Financial Statements for further details on the Schwab IDA Agreement.
NOTE 8: OTHER ASSETS
Other Assets
(millions of Canadian dollars)
As at
July 31
October 31
2026
2025
Accounts receivable and other items
$
$
Accrued interest
Current income tax receivable
Defined benefit asset
Investments in other associates and joint ventures
1
Prepaid expenses
Reinsurance contract assets
Total
$
$
1
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 71
NOTE 9: DEPOSITS
Demand deposits are those for which the Bank does not have the right to require notice prior to withdrawal, which primarily include business and government
chequing accounts. Notice deposits are those for which the Bank can legally require notice prior to withdrawal, which include both savings and chequing
accounts. Term deposits are payable on a given date of maturity with terms ranging from one day to ten years and generally include fixed term deposits,
guaranteed investment certificates, senior debt, and similar instruments. The aggregate amount of term deposits in denominations of $100,000 or more as at
July 31, 2026, was $
Deposits
(millions of Canadian dollars)
As at
July 31
October 31
By Type
By Country
2026
2025
Demand
Notice
Term
1
Canada
United States
International
Total
Total
Personal
$
$
$
$
$
$
$
$
Banks
Business and government
2
Trading
Designated at fair value through
profit or loss
3
Total
$
$
$
$
$
$
$
$
Non-interest-bearing deposits
included above
4
Canada
$
$
United States
International
Interest-bearing deposits
included above
4
Canada
United States
5
International
Total
2,6
$
$
1
Includes $
Canada Deposit Insurance Corporation, including the ability to convert specified eligible shares and liabilities into common shares in the event that the Bank becomes non-viable.
2
Includes $
3
and other liabilities designated at FVTPL.
4
5
6
currencies.
NOTE 10: OTHER LIABILITIES
Other Liabilities
(millions of Canadian dollars)
As at
July 31
October 31
2026
2025
Accounts payable, accrued expenses, and other items
$
$
Accrued interest
Accrued salaries and employee benefits
Cheques and other items in transit
Current income tax payable
Deferred tax liabilities
Defined benefit liability
Lease liabilities
Liabilities related to structured entities
Provisions
Total
$
$
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 72
NOTE 11: SUBORDINATED NOTES AND DEBENTURES
Issuances
On April 30, 2026, the Bank issued $
maturing on June 16, 2036. The notes will bear interest at a fixed rate of
% per annum (paid semi-annually) until June 16, 2031, and at the Daily
Compounded Canadian Overnight Repo Rate Average plus
% thereafter (paid quarterly) until maturity on June 16, 2036. With prior approval of OSFI, the
Bank may, at its option, redeem the notes on or after June 16, 2031, in whole or in part, at par plus accrued and unpaid interest on not more than
Subsequent to the quarter ended July 31, 2026, on August 5, 2026, the Bank issued $
Notes (NVCC) constituting subordinated indebtedness of the Bank, maturing on August 5, 2036. The notes will bear interest at a fixed rate of
% per annum
(paid semi-annually) until August 5, 2031, and at the 5-year SORA-OIS rate plus
% thereafter (paid semi-annually) until maturity on August 5, 2036. With
prior approval of OSFI, the Bank may, at its option, redeem the notes on August 5, 2031, in whole but not in part, at par plus accrued and unpaid interest on not
more than
Redemptions
On March 4, 2026, the Bank redeemed all of its outstanding $
% NVCC Subordinated Notes due March 4, 2031, constituting subordinated
indebtedness of the Bank, at a redemption price of
date.
Subsequent to the quarter ended July 31, 2026, on August 11, 2026, the Bank announced that it intends to exercise its right to redeem all of its outstanding
US$
% NVCC Subordinated Notes due 2031 on September 15, 2026, at a redemption price of par, plus accrued and unpaid interest up to, but
excluding, the redemption date.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 73
NOTE 12: EQUITY
On June 11, 2026, the Bank issued $
bear interest at a rate of
LRCNs will reset every
.
Concurrently with the issuance of the LRCNs, the Bank issued
Shares Series 34). The Preferred Shares Series 34 are eliminated on the Bank’s Consolidated Financial Statements. With prior approval of OSFI, the Bank may,
at its option, redeem the notes on or after July 31, 2031, in whole or in part, at par plus accrued and unpaid interest on not more than
notice to holders.
The following table summarizes the changes to the shares and other equity instruments issued and outstanding, and treasury instruments held as at and for the
three and nine months ended July 31, 2026 and July 31, 2025.
Shares and Other Equity Instruments Issued and Outstanding and Treasury Instruments Held
(thousands of shares or other equity instruments
and millions of Canadian dollars)
For the three months ended
For the nine months ended
July 31, 2026
July 31, 2025
July 31, 2026
July 31, 2025
Number
Number
Number
Number
of shares
Amount
of shares
Amount
of shares
Amount
of shares
Amount
Common Shares
Balance as at beginning of period
$
$
$
$
Proceeds from shares issued on exercise
of stock options
Shares issued as a result of dividend
reinvestment plan
Purchase of shares for cancellation and other
(14,489 )
(212 )
(15,530 )
(227 )
(53,261 )
(780 )
(45,531 )
(663 )
Balance as at end of period – common shares
$
$
$
$
Preferred Shares and Other Equity Instruments
Preferred Shares – Class A
Balance as at beginning of period
$
$
$
$
Redemption of shares
(14,000 )
(350 )
(34,000 )
(850 )
Balance as at end of period
$
$
$
$
Other Equity Instruments
1
Balance as at beginning of period
$
$
$
$
Issue of limited recourse capital notes
Balance as at end of period
$
$
$
$
Balance as at end of period – preferred shares
and other equity instruments
$
$
$
$
Treasury – common shares
2
Balance as at beginning of period
$
(60 )
$
(26 )
$
$
(17 )
Purchase of shares
(2,949 )
(3,222 )
(9,162 )
(9,606 )
Sale of shares
(18,691 )
(32,900 )
(67,238 )
(111,741 )
Balance as at end of period – treasury
– common shares
$
(19 )
$
(92 )
$
(19 )
$
(92 )
Treasury – preferred shares and
other equity instruments
2
Balance as at beginning of period
$
(14 )
$
(28 )
$
(4 )
$
(18 )
Purchase of shares and other equity instruments
(2,022 )
(73 )
(2,537 )
(1,460 )
Sale of shares and other equity instruments
(1,595 )
(779 )
(2,168 )
(4,243 )
Balance as at end of period – treasury
– preferred shares and other equity instruments
$
(46 )
$
(2 )
$
(46 )
$
(2 )
1
For Other Equity Instruments, the number of shares represents the number of notes issued.
2
reduction in equity.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 74
DIVIDENDS
On August 26, 2026, the Board approved a dividend in an amount of one dollar and twelve cents ($
) per fully paid common share in the capital stock of the
Bank for the quarter ending October 31, 2026, payable on and after October 31, 2026, to shareholders of record at the close of business on October 9, 2026.
DIVIDEND REINVESTMENT PLAN
The Bank offers a Dividend Reinvestment Plan (DRIP) for its common shareholders. Participation in the plan is optional and under the terms of the plan, cash
dividends on common shares are used to purchase additional common shares. At the option of the Bank, the common shares may be issued from treasury at an
average market price based on the last five trading days before the date of the dividend payment, with a discount of between
% to
% at the Bank’s discretion or
purchased from the open market at market prices.
During the three and nine months ended July 31, 2026, the Bank satisfied the DRIP requirements through open market common share purchases. During the
three months ended July 31, 2025, the Bank satisfied the DRIP requirements through open market common share purchases. During the nine months ended
July 31, 2025, the Bank satisfied the DRIP requirements through common shares issued from treasury with
common share purchases in the last six months.
NORMAL COURSE ISSUER BID
On February 24, 2025, the Bank announced that the Toronto Stock Exchange (TSX) and OSFI had approved a normal course issuer bid (2025 NCIB) to purchase
for cancellation up to
cancelled $
On January 16, 2026, the Bank announced that the TSX and OSFI have approved the Bank’s new normal course issuer bid (2026 NCIB) to repurchase for
cancellation up to $
on (A) the earliest to occur of: (i) January 15, 2027; (ii) the date on which the aggregate purchase cost of common shares purchased equals $
date on which the maximum number of common shares purchasable is reached; or (B) such earlier date as the Bank may determine. From the commencement of
the 2026 NCIB on January 20, 2026, to July 31, 2026, the Bank repurchased
total amount of $
NCIB program, for a total of $
NOTE 13: SHARE-BASED COMPENSATION
For the three and nine months ended July 31, 2026, the Bank recognized compensation expense for stock option awards of $
respectively (three and nine months ended July 31, 2025 – $
July 31, 2025,
nil
stock options were granted by the Bank at a weighted-average fair value of $
The following table summarizes the assumptions used for estimating the fair value of options for the nine months ended July 31, 2026 and July 31, 2025.
Assumptions Used for Estimating the Fair Value of Options
(in Canadian dollars, except as noted)
For the nine months ended
July 31
July 31
2026
2025
Risk-free interest rate
%
%
Option contractual life
Expected volatility
%
%
Expected dividend yield
%
%
Exercise price/share price
$
$
The risk-free interest rate is based on Government of Canada benchmark bond yields as at the grant date. Expected volatility is calculated based on the historical
average daily volatility and expected dividend yield is based on dividend payouts in the last fiscal year. These assumptions are measured over a period
corresponding to the option contractual life.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 75
NOTE 14: EMPLOYEE BENEFITS
The following table summarizes expenses for the Bank’s principal pension and non-pension post-retirement defined benefit plans and the Bank’s other material
defined benefit pension plans, for the three and nine months ended July 31, 2026 and July 31, 2025. Other employee defined benefit plans operated by the Bank
and certain of its subsidiaries are not considered material for disclosure purposes.
Defined Benefit Plan Expenses
(millions of Canadian dollars)
Principal post-retirement
Principal pension plans
benefit plan
Other pension plans
1
For the three months ended
July 31
July 31
July 31
July 31
July 31
July 31
2026
2025
2026
2025
2026
2025
Service cost – benefits earned
$
$
$
$
$
$
Net interest cost (income) on net defined benefit liability (asset)
(12 )
(13 )
Interest cost on asset limitation and minimum funding
requirement
Past service cost
Defined benefit administrative expenses
Total
$
$
$
$
$
$
For the nine months ended
July 31
July 31
July 31
July 31
July 31
July 31
2026
2025
2026
2025
2026
2025
Service cost – benefits earned
$
$
$
$
$
$
Net interest cost (income) on net defined benefit liability (asset)
(35 )
(38 )
Interest cost on asset limitation and minimum funding
requirement
Past service cost
Defined benefit administrative expenses
Total
$
$
$
$
$
$
1
Includes Canada Trust defined benefit pension plan, TD Banknorth defined benefit pension plan, TD Auto Finance defined benefit pension plan, TD Insurance defined benefit pension
plan, and supplemental executive defined benefit pension plans.
The following table summarizes expenses for the Bank’s defined contribution plans for the three and nine months ended July 31, 2026 and July 31, 2025.
Defined Contribution Plan Expenses
(millions of Canadian dollars)
For the three months ended
For the nine months ended
July 31
July 31
July 31
July 31
2026
2025
2026
2025
Defined contribution pension plans
1
$
$
$
$
Government pension plans
2
Total
$
$
$
$
1
Includes defined contribution portion of the TD Pension Plan (Canada) and TD Bank, N.A. defined contribution 401(k) plan.
2
Federal Insurance Contributions Act
.
The following table summarizes the remeasurements recognized in OCI for the Bank’s principal pension and post-retirement defined benefit plans and certain of
the Bank’s other material defined benefit pension plans, for the three and nine months ended July 31, 2026 and July 31, 2025.
Amounts Recognized in Other Comprehensive Income for Remeasurement of Defined Benefit Plans
1,2,3
(millions of Canadian dollars)
Principal post-retirement
Principal pension plans
benefit plan
Other pension plans
For the three months ended
July 31
July 31
July 31
July 31
July 31
July 31
2026
2025
2026
2025
2026
2025
Remeasurement gain/(loss) – financial
$
$
$
$
$
$
Remeasurement gain/(loss) – return on plan assets less
interest income
(51 )
(177 )
Change in asset limitation and minimum funding requirement
(11 )
Total
$
$
(25 )
$
$
$
$
For the nine months ended
July 31
July 31
July 31
July 31
July 31
July 31
2026
2025
2026
2025
2026
2025
Remeasurement gain/(loss) – financial
$
$
$
$
$
$
Remeasurement gain/(loss) – return on plan assets less
interest income
(472 )
(361 )
Change in asset limitation and minimum funding requirement
(11 )
Total
$
$
(51 )
$
$
$
$
1
plan, and other employee defined benefit plans operated by the Bank and certain of its subsidiaries not considered material for disclosure purposes as these plans are not remeasured on
a quarterly basis.
2
3
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 76
NOTE 15: INCOME TAXES
Income Tax Adjustment on the Gain on Sale of Schwab Shares
In the second quarter of fiscal 2026, the Bank revised its estimate of taxes owed on the gain from its disposition of Schwab shares in the prior year. The revision
reflected the Bank's most recent tax filings and included previously inestimable information. The revision reduced the Bank's provision for income taxes by
$
Other Tax Matters
The Canada Revenue Agency (CRA), Revenu Québec Agency (RQA) and Alberta Tax and Revenue Administration (ATRA) are denying certain dividend and
interest deductions claimed by the Bank. During the quarter, the CRA and the RQA reassessed the Bank for a total of $
interest. As at July 31, 2026, the CRA has reassessed the Bank for $
the years 2011 to 2020, and the ATRA has reassessed the Bank for $
$
appropriate and filed a Notice of Appeal with the Tax Court of Canada on March 21, 2023.
NOTE 16: EARNINGS PER SHARE
Basic earnings per share is calculated by dividing net income available to common shareholders by the weighted-average number of common shares outstanding
for the period.
Diluted earnings per share is calculated using the same method as basic earnings per share except that certain adjustments are made to net income available
to common shareholders and the weighted-average number of shares outstanding for the effects of all dilutive potential common shares that are assumed to be
issued by the Bank.
The following table presents the Bank’s basic and diluted earnings per share for the three and nine months ended July 31, 2026 and July 31, 2025.
Basic and Diluted Earnings Per Share
(millions of Canadian dollars, except as noted)
For the three months ended
For the nine months ended
July 31
July 31
July 31
July 31
2026
2025
2026
2025
Basic earnings per share
Net income available to common shareholders
$
$
$
$
Weighted-average number of common shares outstanding (millions)
Basic earnings per share
(Canadian dollars)
$
$
$
$
Diluted earnings per share
Net income available to common shareholders including impact of dilutive securities
$
$
$
$
Weighted-average number of common shares outstanding (millions)
Effect of dilutive securities
Stock options potentially exercisable (millions)
1
Weighted-average number of common shares outstanding – diluted (millions)
Diluted earnings per share
(Canadian dollars)
1
$
$
$
$
1
For the three and nine months ended July 31, 2026, and the three months ended July 31, 2025,
For the nine months ended July 31, 2025, the computation of diluted earnings per share excluded average options outstanding of
$
, as the option price was greater than the average market price of the Bank’s common shares.
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 77
NOTE 17: PROVISIONS AND CONTINGENT LIABILITIES
Other than as described below, there have been no new significant events or transactions except as previously identified in Note 25 of the Bank’s 2025 Annual
Consolidated Financial Statements.
(a)
In the ordinary course of business, the Bank and its subsidiaries are involved in various legal and regulatory actions, including but not limited to civil claims and
lawsuits, regulatory examinations, investigations, audits, and requests for information by governmental, regulatory and self-regulatory agencies and law
enforcement authorities in various jurisdictions, in respect of our businesses and compliance programs. The Bank establishes provisions when it becomes
probable that the Bank will incur a loss and the amount can be reliably estimated. The Bank also estimates the aggregate range of reasonably possible losses
(RPL) in its legal and regulatory actions (that is, those which are neither probable nor remote), in excess of provisions. However, the Bank does not disclose the
specific possible loss associated with each underlying matter given the substantial uncertainty associated with each possible loss as described below and the
negative consequences to the Bank’s resolution of the matters that comprise the RPL should individual possible losses be disclosed. As at July 31, 2026, the
Bank’s RPL is from
the Bank’s best estimates based upon currently available information for actions for which estimates can be made, but there are a number of factors that could
cause the Bank’s actual losses to be significantly different from its provisions or RPL. For example, the Bank’s estimates involve significant judgment due to the
varying stages of the proceedings, the existence of multiple defendants in many proceedings whose share of liability has yet to be determined, the numerous yet-
unresolved issues in many of the proceedings, some of which are beyond the Bank’s control and/or involve novel legal theories and interpretations, the attendant
uncertainty of the various potential outcomes of such proceedings, and the fact that the underlying matters will change from time to time. In addition, some actions
seek very large or indeterminate damages. Refer to Note 25 of the Bank’s 2025 Annual Consolidated Financial Statements for details on the Bank’s significant
legal and regulatory matters. Based on the Bank’s current knowledge, and subject to the factors listed above as well as other uncertainties inherent in litigation and
regulatory matters, other than as described below: (i) there have been no notable developments to the matters previously identified in Note 25 of the Bank’s 2025
Annual Consolidated Financial Statements; and (ii) since October 31, 2025, no other legal or regulatory matter has arisen or progressed to the point that it would
reasonably be expected to result in a material financial impact to the Bank.
As previously disclosed, on October 10, 2024, the Bank announced that, following active cooperation and engagement with authorities and regulators, it
reached a resolution (the “Global Resolution”) of previously disclosed investigations related to its U.S. Bank Secrecy Act (BSA) and Anti-Money Laundering (AML)
compliance programs (collectively, the “U.S. BSA/AML program”). The Bank and certain of its U.S. subsidiaries consented to orders with the Office of the
Comptroller of the Currency (OCC), the Federal Reserve Board, and the Financial Crimes Enforcement Network and entered into plea agreements with the
Department of Justice (DOJ), Criminal Division, Money Laundering and Asset Recovery Section and the United States Attorney’s Office for the District of New
Jersey. Details of the Global Resolution include: (i) a total payment of US$
(ii) TD Bank, N.A. (TDBNA) pleading guilty to one count of conspiring to fail to maintain an adequate AML program, failing to file accurate currency transaction
reports (CTRs) and launder money and TD Bank US Holding Company (TDBUSH) pleading guilty to two counts of causing TDBNA to fail to maintain an adequate
AML program and to fail to file accurate CTRs; (iii) requirements to remediate the Bank’s U.S. BSA/AML program; (iv) a requirement to prioritize the funding and
staffing of the remediation, which includes Board certifications for dividend distributions from certain of the Bank’s U.S. subsidiaries to the Bank; (v) formal
oversight of the U.S. BSA/AML remediation through an independent compliance monitorship; (vi) a prohibition against the average combined total assets of TD’s
two U.S. banking subsidiaries (TDBNA and TD Bank USA, N.A.) (collectively, the “U.S. Bank”) exceeding US$
of the U.S. Bank as at September 30, 2024) (the “Asset Limitation”), and if the U.S. Bank does not achieve compliance with all actionable articles in the OCC
consent orders (and for each successive year that the U.S. Bank remains non-compliant), the OCC may require the U.S. Bank to further reduce total consolidated
assets by up to
%; (vii) the U.S. Bank being subject to OCC supervisory approval processes for any additions of new bank products, services, markets, and
stores prior to the OCC’s acceptance of the U.S. Bank’s improved AML policies and procedures, to ensure the AML risk of new initiatives is appropriately
considered and mitigated; (viii) requirements for the Bank and TD Group U.S. Holdings, LLC (TDGUS) to retain a third party to assess the effectiveness of the
corporate governance and U.S. management structure and composition to adequately oversee U.S. operations; (ix) requirements to comply with the terms of the
plea agreements with the DOJ during a five-year term of probation (which could be extended as a result of the Bank failing to complete the compliance
undertakings, failing to cooperate or to report alleged misconduct as required, or committing additional crimes); (x) an ongoing obligation to cooperate with DOJ
investigations; and (xi) an ongoing obligation to report evidence or allegations of violations by the Bank, its affiliates, or their employees that may be a violation of
U.S. federal law. The Bank is focused on meeting the terms of the consent orders and plea agreements, including meeting its requirements to remediate the
Bank’s U.S. BSA/AML compliance programs. During the first fiscal quarter of 2025, the Bank fully paid the remainder of the monetary penalty owed pursuant to the
consent orders and plea agreements that were entered into as part of the Global Resolution. The payment was covered by provisions previously taken by the Bank
for this matter.
As previously disclosed, the Bank and some former and current directors, officers and employees have been named as defendants in proposed class action
lawsuits in the United States and Canada purporting to be brought on behalf of the Bank’s shareholders alleging, among other things, that a decline in the price of
the Bank’s shares was the result of misleading disclosures with respect to the Bank’s AML compliance programs and/or the potential outcomes of the government
agencies’ or regulators’ investigations. The two proposed class actions filed in the United States have been consolidated under the caption
Tiessen v. The
Toronto-Dominion Bank, et al.,
in the United States District Court for the Southern District of New York, and a consolidated amended complaint has been filed
which names TD Bank, N.A., TDBUSH, and certain former and current officers as defendants. On May 30, 2025, the defendants filed a motion to dismiss in the
Tiessen
case, which is pending before the court. Out of the three proposed class actions in Ontario,
Parkin v. The Toronto-Dominion Bank, et al.,
has been
identified as the lead action with the other two Ontario actions being stayed. There remains one further proposed class action in Quebec which has been stayed.
The
Parkin
certification hearing and the motion to seek leave under the
Securities Act
(Ontario) have been argued and the court's decision is pending. A putative
shareholder derivative action, captioned
Rubin v. Masrani, et al.,
has also been filed purportedly on behalf of TD in the United States in the Supreme Court of the
State of New York, New York County, against certain former and current TD directors, officers and employees, and certain of TD’s U.S. affiliates and subsidiaries.
The complaint asserts alleged breaches of duties and other claims against the individual defendants in connection with the Bank’s U.S. BSA/AML compliance
programs. On October 31, 2025, TD filed a motion to dismiss the
Rubin
action, which is pending before the court. Certain purported TD shareholders have also
filed an application in the Ontario Superior Court of Justice (
The Trustees of International Brotherhood of Electrical Workers, et al., v. The Toronto-Dominion Bank,
et al.
) seeking leave to bring a shareholder derivative action in the Delaware Court of Chancery on behalf of TD and TDBUSH against certain current and former
directors and officers. The motion to seek leave was heard on April 21, 2026. On May 4, 2026, the Court issued its decision declining the application. The
applicants filed a notice of appeal and the appeal is scheduled to be heard on March 17, 2027. All of the proceedings are still in early stages. Losses or damages
cannot be estimated at this time.
As previously disclosed, the Bank has been named as a defendant in a purported class action lawsuit in the United States to be brought on behalf of First
Horizon shareholders alleging that a decline in the price of First Horizon shares was the result of alleged misleading disclosures the Bank made with respect to its
U.S. BSA/AML compliance programs and its effect on the Bank’s contemplated merger with First Horizon. The lawsuit also names some of the Bank’s former and
current officers and a former employee as defendants. On November 26, 2025, the court dismissed plaintiffs’ complaint, but gave plaintiffs a final opportunity to
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 78
amend their complaint again to attempt to address its deficiencies. On January 22, 2026, the plaintiffs did not amend their complaint and instead filed a notice of
appeal. On February 26, 2026, three lawsuits brought by entities organized under the laws of the Cayman Islands were filed on an individual basis in New Jersey
state court against the Bank, TDBNA, TDGUS and current and former officers and employees claiming they were induced to purchase and hold First Horizon stock
based on TD's representations concerning TD's U.S. BSA/AML compliance programs and its effect on the Bank's contemplated merger with First Horizon
(
Nineteen77 Global Multi-Strategy Alpha Master Ltd. et al v. The Toronto-Dominion Bank et al; AQR Arbitrage MA Offshore Fund L.P. et al v. The Toronto-
Dominion Bank et al; HBK Master Fund LP et al v. The Toronto-Dominion Bank et al
.). On March 27, 2026, TD filed a notice to remove the cases to federal court,
which plaintiffs are contesting. Losses or damages cannot be estimated at this time.
U.S. government agencies are conducting inquiries or investigations related to fair access to banking, including pursuant to Executive Order 14331
(Guaranteeing Fair Banking for All Americans), which directed a review by certain government agencies of financial institutions’ policies and practices for
providing, maintaining, or discontinuing financial products or services to customers or potential customers. The Bank is responding to requests from U.S.
government agencies regarding, among other things, the Bank's policies and processes and the provision of services to customers and potential customers.
As previously disclosed, the Bank is a defendant in Canada and/or the United States in a number of matters, including class actions, alleging claims in
connection with various fees, practices and credit decisions. The cases are in various stages of maturity and include, among others: a Quebec action against
members of the financial services industry (including the Bank) regarding the existence and amount of the insufficient or non-sufficient funds fee, a Quebec action
against certain brokers (including TD Direct Investing) regarding disclosure of foreign conversion fees, a Quebec action against members of the automobile
insurance industry (including Primmum Insurance Company) regarding underwriting practices in Quebec, a class action that was certified against the Bank related
to a specific class of employees and TD’s practice of treating amounts paid under the applicable compensation plans as inclusive of vacation pay and public
holiday pay for those employees, and a Quebec action that was recently certified against members of the financial services industry (including the Bank) regarding
certain mortgage prepayment charges.
Refer to Note 15 for disclosures related to tax matters.
(b)
During fiscal 2026, the Bank undertook certain measures to reduce its cost base and achieve greater efficiency. The restructuring program concluded on
January 31, 2026. For the three and nine months ended July 31, 2026, the Bank incurred pre-tax restructuring charges (recovery) of ($
) million and $
respectively (three and nine months ended July 31, 2025 – $
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 79
NOTE 18: SEGMENTED INFORMATION
For management reporting purposes, the Bank reports its results from business operations and activities under four key business segments: Canadian Personal
and Commercial Banking, U.S. Banking, Wealth Management and Insurance, and Wholesale Banking. The Bank’s other activities are grouped into the Corporate
segment. Effective the first quarter of 2026, the Bank renamed its U.S. Retail segment to U.S. Banking to better reflect the segment’s financial products and
services.
Canadian Personal and Commercial Banking provides financial products and services to personal, small business and commercial customers, and includes
TD Auto Finance Canada. U.S. Banking is comprised of personal and business banking in the U.S., TD Auto Finance U.S., and the U.S. wealth business. Effective
the first quarter of 2026, non-interest income within U.S. Banking is adjusted for the Bank’s share of losses from community-based tax-advantaged investments
accounted for using the equity method which are reclassified to provision for income taxes. The adjustment for the three and nine months ended July 31, 2026 was
$
$
February 12, 2025, the Bank sold its entire remaining equity investment in Schwab. Prior to the sale, the Bank’s investment in Schwab was reported in the U.S.
Banking segment, refer to Note 7 for further details. Wealth Management and Insurance includes the Canadian wealth business which provides investment
products and services to institutional and retail investors, and the insurance business which provides property and casualty insurance, as well as life and health
insurance products to customers across Canada. Wholesale Banking provides a wide range of capital markets, investment banking, and corporate banking
products and services, including underwriting and distribution of new debt and equity issues, providing advice on strategic acquisitions and divestitures, and
meeting the daily trading, funding, and investment needs of the Bank’s clients. The Corporate segment includes the effects of certain asset securitization
programs, treasury management, elimination of taxable equivalent adjustments and other management reclassifications, corporate level tax items, and residual
unallocated revenue and expenses.
The following table summarizes the segment results for the three and nine months ended July 31, 2026 and July 31, 2025.
Results by Business Segment
1
(millions of Canadian dollars)
Canadian
Wealth
Personal and
Management
Commercial Banking
U.S. Banking
and Insurance
Wholesale Banking
2
Corporate
2
Total
For the three months ended July 31
2026
2025
2026
2025
2026
2025
2026
2025
2026
2025
2026
2025
Net interest income (loss)
$
$
$
$
$
$
$
$
$
$
$
$
Non-interest income (loss)
(144 )
(25 )
Total revenue
Provision for (recovery of)
credit losses
Insurance service expenses
Non-interest expenses
Income (loss) before income taxes
and share of net income from
investment in Schwab
(445 )
(869 )
Provision for (recovery of)
income taxes
(307 )
(391 )
Share of net income from
investment in Schwab
3,4
Net income (loss)
$
$
$
$
$
$
$
$
$
(138 )
$
(478 )
$
$
For the nine months ended July 31
2026
2025
2026
2025
2026
2025
2026
2025
2026
2025
2026
2025
Net interest income (loss)
$
$
$
$
$
$
$
$
$
$
$
$
Non-interest income (loss)
(300 )
Total revenue
Provision for (recovery of)
credit losses
Insurance service expenses
Non-interest expenses
Income (loss) before income taxes
and share of net income from
investment in Schwab
(1,742 )
Provision for (recovery of)
income taxes
(1,309 )
(678 )
Share of net income from
investment in Schwab
3,4
Net income (loss)
$
$
$
$
$
$
$
$
$
(433 )
$
$
$
1
The retailer program partners’ share of revenues and credit losses is presented in the Corporate segment, with an offsetting amount (representing the partners’ net share) recorded in
non-interest expenses, resulting in no impact to Corporate reported net income (loss). Net income (loss) included in the U.S. Banking segment includes only the portion of revenue and
credit losses attributable to the Bank under the agreements.
2
segment.
3
4
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 80
Total Assets by Business Segment
(millions of Canadian dollars)
Canadian
Wealth
Personal and
Management
Wholesale
Commercial Banking
U.S. Banking
and Insurance
Banking
Corporate
Total
As at July 31, 2026
Total assets
$
$
$
$
$
$
As at October 31, 2025
Total assets
$
$
$
$
$
$
NOTE 19: INTEREST INCOME AND EXPENSE
The following tables present interest income and interest expense by basis of accounting measurement.
Interest Income
(millions of Canadian dollars)
For the three months ended
For the nine months ended
July 31, 2026
July 31, 2025
July 31, 2026
July 31, 2025
Measured at amortized cost
1
$
$
$
$
Measured at FVOCI – Debt instruments
1
Measured or designated at FVTPL
Measured at FVOCI – Equity instruments
Total
$
$
$
$
1
Interest income is calculated using EIRM.
Interest Expense
(millions of Canadian dollars)
For the three months ended
For the nine months ended
July 31, 2026
July 31, 2025
July 31, 2026
July 31, 2025
Measured at amortized cost
1
$
$
$
$
Measured or designated at FVTPL
Total
$
$
$
$
1
Interest expense is calculated using EIRM.
NOTE 20: REGULATORY CAPITAL
The Bank manages its capital under guidelines established by OSFI. The regulatory capital guidelines measure capital in relation to credit, market, and operational
risks. The Bank has various capital policies, procedures, and controls which it utilizes to achieve its goals and objectives. The Bank is designated as a domestic
systemically important bank (D-SIB) and a global systemically important bank (G-SIB).
Canadian banks designated as D-SIBs are required to comply with OSFI’s minimum targets for risk-based capital and leverage ratios. The minimum targets
include a D-SIB surcharge and Domestic Stability Buffer (DSB) for Common Equity Tier 1 Capital, Tier 1 Capital, Total Capital and risk-based Total Loss
Absorbing Capacity (TLAC) ratios. The DSB level was decreased to
% as of June 19, 2026, and as a result the published regulatory minimum targets are set at
%,
%,
% and
%, respectively. The OSFI target includes the greater of the D-SIB or G-SIB surcharge, both of which are currently
% for the Bank.
The OSFI target for leverage requires D-SIBs to hold a leverage ratio buffer of
% in addition to the existing minimum requirement. This sets the published
regulatory minimum targets for leverage and TLAC leverage ratios at
% and
%, respectively.
The Bank complied with all minimum risk-based capital and leverage ratio requirements set by OSFI in the nine months ended July 31, 2026.
The following table summarizes the Bank’s regulatory capital positions as at July 31, 2026 and October 31, 2025.
Regulatory Capital Position
(millions of Canadian dollars, except as noted)
As at
July 31
October 31
2026
2025
Capital
Common Equity Tier 1 Capital
$
$
Tier 1 Capital
Total Capital
Risk-weighted assets used in the calculation of capital ratios
Capital and leverage ratios
Common Equity Tier 1 Capital ratio
%
%
Tier 1 Capital ratio
Total Capital ratio
Leverage ratio
TLAC Ratio
TLAC Leverage Ratio
TD BANK GROUP • THIRD QUARTER 2026 • REPORT TO SHAREHOLDERS
Page 81
SHAREHOLDER AND INVESTOR INFORMATION
Shareholder Services
If you:
And your inquiry relates to:
Are a registered shareholder (your name appears
on your TD share certificate)
Missing dividends, lost share certificates, estate
questions, address changes to the share register,
dividend bank account changes, the dividend
reinvestment plan, eliminating duplicate mailings of
shareholder materials or stopping (or resuming)
receiving annual and quarterly reports
Transfer Agent:
TSX Trust Company
301-100 Adelaide Street West
Toronto, ON M5H 4H1
1-800-387-0825 (Canada and U.S. only)
or 416-682-3860
Facsimile: 1-888-249-6189
shareholderinquiries@tmx.com or www.tsxtrust.com
Hold your TD shares through the
Direct Registration System
in the United States
Missing dividends, lost share certificates, estate
questions, address changes to the share register,
eliminating duplicate mailings of shareholder
materials or stopping (or resuming) receiving annual
and quarterly reports
Co-Transfer Agent and Registrar:
Computershare Trust Company, N.A.
P.O. Box 43006
Providence, RI 02940-3006
or
Computershare Trust Company, N.A.
150 Royall Street
Suite 101
Canton, MA 02021
1-866-233-4836
TDD for hearing impaired: 1-800-231-5469
Shareholders outside of U.S.: 201-680-6578
TDD shareholders outside of U.S.: 201-680-6610
Email inquiries: web.queries@computershare.com
For electronic access to your account visit:
www.computershare.com/investor
Beneficially own TD shares that are held in the
name of an intermediary, such as a bank, a trust
company, a securities broker or other nominee
Your TD shares, including questions regarding the
dividend reinvestment plan and mailings of
shareholder materials
Your intermediary
For all other shareholder inquiries, please contact TD Shareholder Relations at 416-944-6367 or 1-866-756-8936 or email td.shareholderrelations@td.com. Please
note that by leaving us an e-mail or voicemail message, you are providing your consent for us to forward your inquiry to the appropriate party for response.
General Information
Products and services: Contact TD Canada Trust, 24 hours a day, seven days a week: 1-866-567-8888
French: 1-866-233-2323
Cantonese/Mandarin: 1-800-328-3698
Telephone device for the hearing impaired (TTY): 1-800-361-1180
Website: www.td.com
Email: customer.service@td.com
Quarterly Earnings Conference Call
TD Bank Group will host an earnings conference call in Toronto, Ontario on August 27, 2026. The call will be audio webcast live through TD’s website at
9:30 a.m. ET. The call will feature presentations by TD executives on the Bank’s financial results for the third quarter and discussions of related disclosures,
followed by a question-and-answer period with analysts. The presentation material referenced during the call will be available on the TD website at
www.td.com/investor on August 27, 2026, in advance of the call. A listen-only telephone line is available at 416-855-9085 or 1-800-990-2777 (toll free), passcode
00855#.
The audio webcast and presentations will be archived at www.td.com/investor. Replay of the teleconference will be available until 11:59 p.m. ET on
September 11, 2026, by calling 289-819-1325 or 1-888-660-6264 (toll free). The passcode is 00855#.
Annual Meeting
Thursday, April 15, 2027
Toronto, Ontario