Financial institution TD temporarily sets aside growth objectives following conclusion of Anti-Money Laundering settlement
In a series of moves aimed at strengthening its anti-money laundering (AML) practices, TD Bank, a leading Canadian lender, has taken several steps to address deficiencies in its money laundering safeguards.
Following a plea agreement with the U.S. Department of Justice (DOJ) in October 2024, TD has formed dedicated committees to oversee AML remediation and has set new risk limits. The bank is also enhancing its transaction monitoring platform and has bolstered its financial crime staff, appointing a Bank Secrecy Act officer.
The AML management remediation actions are expected to occur primarily in calendar year 2025, with some in 2026. TD has also suspended medium-term financial targets related to adjusted earnings per share growth, return on equity, and operating leverage as it focuses on these improvements.
In addition to these AML-related efforts, TD has initiated a comprehensive strategic review. The bank is reducing its U.S. assets by about 10% to comply with a $434 billion asset cap, and plans to sell or reduce some lending activities, including export/import lending and commercial auto dealer lending, and sell up to $50 billion in investment securities to trim its U.S. assets. TD expects to update these targets in the second half of next year.
The bank has also moved to strengthen governance and oversight in relation to AML. In a significant development, the Financial Transactions and Reports Analysis Centre of Canada has signed an agreement with the Federal Reserve, the Office of the Comptroller of the Currency, and the Federal Deposit Insurance Corp., enabling the sharing of supervisory information on Canadian banks that do business in the U.S. This agreement focuses on AML and anti-terrorist financing compliance.
TD's fiscal year 2024 expenses soared 19% year-over-year due to investments in risk and control infrastructure and employees. Despite this, the bank's fourth-quarter net income for its U.S. retail segment declined 32%. TD's plea agreements have resulted in one TD entity being "disqualified" from serving as an investment adviser or underwriter in the U.S., requiring a waiver from the Securities and Exchange Commission.
The most recent publicly available information from August 2025 does not provide detailed updates specifically on TD Bank's strategic review, asset reduction, or its AML remediation efforts following its plea agreement with the DOJ. However, TD Bank's latest management disclosures mention ongoing AML program remediation and enterprise AML program improvement activities as part of its risk management and governance updates. These updates are included in sections titled “Update on U.S. Bank Secrecy Act (BSA)/Anti-Money Laundering (AML) Program Remediation and Enterprise AML Program Improvement Activities” in quarterly reports and news releases, indicating an ongoing focus but no specific milestone updates were disclosed on August 6, 2025.
In conclusion, TD Bank appears to be actively engaged in AML remediation and enterprise program improvements, as mandated by their DOJ agreement, but there are no new specific disclosures about strategic review or asset reduction initiatives publicly detailed as of August 2025. Further precise updates, if available, would typically be found in TD’s quarterly MD&A or specific news releases dedicated to regulatory compliance status.
Raymond Chun, currently the COO, is set to take the CEO reins in April. TD's fiscal year 2024 revenue rose 13%, but net income fell 17%. Sustainability and testing activities are planned for 2026 and 2027, including a suspicious activity report lookback, which is expected to be completed in 2027.
[1] TD Bank, Management's Discussion and Analysis, Q2 2025, https://www.td.com/investor/financial-reports-and-presentations/quarterly-reports/2025/q2/2025-q2-md-and-a.pdf [2] TD Bank, News Release, TD Bank Group Announces Second Quarter 2025 Results, https://www.td.com/corp/news-and-media/news-releases/2025/08/td-bank-group-announces-second-quarter-2025-results.jsp [3] TD Bank, News Release, TD Bank Group Announces Strategic Review, https://www.td.com/corp/news-and-media/news-releases/2025/01/td-bank-group-announces-strategic-review.jsp
- TD Bank's strategic review includes the reduction of its U.S. assets by about 10%, the selling or reduction of certain lending activities, and the trimming of up to $50 billion in investment securities, all aimed at complying with a $434 billion asset cap, thus impacting the banking-and-insurance industry.
- In its efforts to strengthen its anti-money laundering (AML) practices, TD Bank has formed dedicated committees, set new risk limits, enhanced its transaction monitoring platform, and bolstered its financial crime staff, including appointing a Bank Secrecy Act officer, demonstrating a commitment to the finance and banking-and-insurance sector's regulatory compliance.
