e425
Filed by The Toronto-Dominion Bank
Pursuant to Rule 425 under the Securities Act of 1933
and deemed filed pursuant to Rule 14a-12 under the
Securities Exchange Act of 1934
Subject Company: The South Financial Group, Inc.
Commission File No.: 0-15083
This filing, which includes (i) communications sent to employees of The Toronto-Dominion Bank
and/or TD Bank, Americas Most Convenient Bank on July 13, 2010 and (ii) the transcript of a video
clip made available to employees of The Toronto-Dominion Bank on July 13, 2010, may contain
forward-looking statements within the meaning of the Private Securities Litigation Reform Act of
1995 and comparable safe harbour provisions of applicable Canadian legislation, including, but
not limited to, statements relating to anticipated financial and operating results, the companies
plans, objectives, expectations and intentions, cost savings and other statements, including words
such as anticipate, believe, plan, estimate, expect, intend, will, should, may,
and other similar expressions. Such statements are based upon the current beliefs and expectations
of our management and involve a number of significant risks and uncertainties. Actual results may
differ materially from the results anticipated in these forward-looking statements. The following
factors, among others, could cause or contribute to such material differences: the ability to
obtain the approval of the transaction by The South Financial Group, Inc. shareholders; the ability
to realize the expected synergies resulting from the transaction in the amounts or in the timeframe
anticipated; the ability to integrate The South Financial Group, Inc.s businesses into those of
The Toronto-Dominion Bank in a timely and cost-efficient manner; and the ability to obtain
governmental approvals of the transaction or to satisfy other conditions to the transaction on the
proposed terms and timeframe. Additional factors that could cause The Toronto-Dominion Banks and
The South Financial Group, Inc.s results to differ materially from those described in the
forward-looking statements can be found in the 2009 Annual Report on Form 40-F for The
Toronto-Dominion Bank and the 2009 Annual Report on Form 10-K of The South Financial Group, Inc.
filed with the Securities and Exchange Commission and available at the Securities and Exchange
Commissions Internet site (http://www.sec.gov).
The proposed merger transaction involving The Toronto-Dominion Bank and The South Financial
Group, Inc. will be submitted to The South Financial Group, Inc.s shareholders for their
consideration. The Toronto-Dominion Bank and The South Financial Group, Inc. have filed with the
SEC a Registration Statement on Form F-4 containing a preliminary proxy statement/prospectus and
each of the companies plans to file with the SEC other documents regarding the proposed
transaction. Shareholders are encouraged to read the preliminary proxy statement/prospectus
regarding the proposed transaction and the definitive proxy statement/prospectus when it becomes
available, as well as other documents filed with the SEC because they contain important
information. Shareholders may obtain a free copy of the preliminary proxy statement/prospectus,
and will be able to obtain a free copy of the definitive proxy statement/prospectus when it becomes
available, as well as other filings containing information about The Toronto-Dominion Bank and The
South Financial Group, Inc., without charge, at the SECs Internet site (http://www.sec.gov).
Copies of the definitive proxy statement/prospectus and the filings with the SEC that will be
incorporated by reference in the definitive proxy statement/prospectus can also be obtained, when
available, without charge, by directing a request to TD Bank Financial Group, 66 Wellington Street
West, Toronto, ON M5K 1A2, Attention: Investor Relations, 1-866-756-8936, or to The South Financial
Group, Inc., Investor Relations, 104 South Main Street, Poinsett Plaza, 6th Floor, Greenville,
South Carolina 29601, 1-888-592-3001.
The Toronto-Dominion Bank, The South Financial Group, Inc., their respective directors and
executive officers and other persons may be deemed to be participants in the solicitation of
proxies in respect of the proposed transaction. Information regarding The Toronto-Dominion Banks
directors and executive officers is available in its Annual Report on Form 40-F for the year ended
October 31, 2009, which was filed with the Securities and Exchange Commission on December 03, 2009,
its notice of annual meeting and proxy circular for its 2010 annual meeting, which was filed with
the Securities and Exchange Commission on February 25, 2010, and the above-referenced Registration
Statement on Form F-4, which was filed with the SEC on June 10, 2010. Information regarding The
South Financial Group, Inc.s directors and executive officers is available in The South Financial
Group, Inc.s proxy statement for its 2010 annual meeting, which was filed with the Securities and
Exchange Commission on April 07, 2010. Other information regarding the participants in the proxy
solicitation and a description of their direct and indirect interests, by security holdings or
otherwise, is contained in the above-
referenced Registration Statement on Form F-4, which was filed with the SEC on June 10, 2010,
and other relevant materials to be filed with the SEC when they become available.
THE FOLLOWING IS A COMMUNICATION SENT TO EMPLOYEES OF THE TORONTO-DOMINION BANK ON JULY 13, 2010
1. Ottawas new securities pitch: One watchdog, several offices The Globe and Mail
Canadian securities lawmakers will unveil a roadmap on Tuesday for the creation of a national
regulator one that wont include a centralized head office. See full story
2. Insurance firms lobby for two-tier accounting; Measure Of Capital National Post
Canadas life insurance companies are lobbying Ottawa and accounting standards boards to be allowed
to adopt a two-tier accounting system. The industry wants to avoid using a new international
standard that Canada has accepted but they fear would reflect negatively on their capital
levels. See full story
3. Finance Bill Close to Passage in Senate Democrats Clinch Support of Republicans Brown and
Snowe, Likely Reaching the 60 Votes Needed for the Legislation The Wall Street Journal
Two Senate Republicans said Monday they would support the Obama administrations financial-overhaul
legislation, and Democrats now believe they have the 60 votes needed to push the sweeping bill into
law by the end of the week. See full story
4. VIDEO CLIP: CNBC Fast Money Halftime Report CNBC
Canadas second largest bank TD continues its expanding presence in the U.S. Predicting bank
profits to double over the next three years. Joining us live from Toronto is Ed Clark, president
and CEO of TD Financial. Ed Clark interviewed. See link to video
5. TD targets energy sector deals worth $100M-plus; Acquisition of city firm adds to banks
technical expertise Calgary Herald (Reuters)
Toronto-Dominion Bank will use the new expertise it acquired with Calgarys Ross Smith Sousa to
access large private deals in Canadas oil and gas sector, aiming for transactions of $100 million
or more, a top executive said Monday. Drew MacIntyre(Vice-Chair, TD Securities) quoted. Similar
articles from Bloomberg and Finance et investissement. See full story
6. La TD sintéresse aux métaux précieux [TD is interested in precious metals] Finance et
investissement
Les services de courtage de la TD sapprêtent à embaucher une douzaine de spécialistes de lor, de
largent, du platine et du palladium. TD Securities mentioned. [The brokerage services of the TD
preparing to hire a dozen specialists in gold, silver, platinum and palladium.] See full
story
7. Banks, baubles and a battle for your money The Globe and Mail
Can you be bribed? The big banks think so. Theyre offering cash up to $250 as well as reward
points to get people to switch their chequing accounts, credit cards and mortgages. TD Canada Trust
mentioned. See full story
8. Grant is not just a public relations gesture Guelph Mercury (ON)
TD is pleased to see the City of Guelph receive $1 million from the Greening Canada Fund. In
practical terms, the fund helps communities become more green by investing in energy efficiency
projects at schools and hospitals and providing funding for solar panel installations at
non-profits and other local organizations just to name a few examples. Letter to the Editor
written by Karen Clarke-Whistler (Chief Environment Officer). See full story
9. Kids visit library jungle Timmins Daily Press (ON)
Its a jungle adventure that not only encourages children to have fun, but to fill their summer
holiday with books. For several years now, TD Canada Trust has been teaming up with the Timmins
Public Library to ensure reading remains an integral part of local childrens lives even when
school isnt in session. TD mentioned. See full story
10. TD Bank at center of beach parking probe Gloucester Daily Times (MA)
The search for around $5,000 in missing city beach parking revenues has turned to TD Bank, which
has launched its own internal investigation into whether the money may have disappeared while in
its care. Rebecca Acevedo (Corporate and Public Affairs, TD Bank) quoted. See full story
11. La Scotia et la BMO dans le tourbillon Earl Jones [Scotiabank and BMO in the Earl Jones
whirlwind] Argent
La Banque Royale avait déjà été visé par le groupe des victimes dEarl Jones. Depuis le début de
laffaire Earl Jones, les victimes ont souvent pointé la Banque Royale comme une des responsables
de leur malheur. Mais voilà que deux autres institutions pourraient aussi être prises dans le
tourbillon de lex-financier déchu. [Royal Bank had already been targeted by the group of victims
of Earl Jones. Since the start of the Earl Jones, victims have often pointed to the Royal Bank as a
leader of their misfortune. But now two other institutions could also be taken into the vortex of
the former financial fallen.] See full story
12. Banks survey shows businesses upbeat about economic recovery; Confidence Results may pave way
for interest rate hike The Canadian Press
Canadian firms are giving the recovery a vote of confidence in a key quarterly survey, paving the
way for the Bank of Canadas expected interest rate hike next week. Diana Petramala (TD Economics)
quoted. See full story
13. Les entreprises plutôt optimistes [Companies pretty optimistic] La Presse
Les entreprises canadiennes sont suffisamment optimistes pour que la moitié dentre elles songent à
grossir leurs effectifs au cours des 12 prochains mois. [Canadian companies are optimistic enough
that half of them are considering their numbers grow over the next 12 months.] Diana Petramala (TD
Economics) quoted. See full story
14. A skills squeeze is around the corner, and we must prepare and adapt The Vancouver Sun
Although unemployment is dropping, its still a big preoccupation, a fact underlined last week by
the Organization for Economic Cooperation and Development, which warned governments mustnt take
their focus off joblessness just because theres a recovery. Derek Burleton (VP and Deputy Chief
Economist) quoted. See full story
Looking for TDs view on articles about the bank or the financial industry? Visit TD News &
Views for background on some stories of the moment that may come up in your discussions with
customers, colleagues and friends.
Vous cherchez des opinions et des articles de la TD au sujet du secteur bancaire ou financier?
Visitez Nouvelles et Opinions de la TD pour y trouver de linformation sur certains sujets
dactualité qui peuvent être évoqués dans vos discussions avec des clients, des collègues et des
amis.
Full Stories
1. Ottawas new securities pitch: One watchdog, several offices
The Globe and Mail
07/13/2010
KAREN HOWLETT
Pg. A1
Canadian securities lawmakers will unveil a roadmap on Tuesday for the creation of a national
regulator one that wont include a centralized head office.
The recommendations outlined by a transition office set up by the federal government will suggest
that control reside in a number of regional offices, the latest compromise in what has been a
40-year struggle to replace the
countrys antiquated system for policing securities markets with a
single agency.
Ontario Premier Dalton McGuinty, the biggest supporter of the federal governments single-regulator
initiative, has lobbied to have the head office in Toronto, home to Canadas major industry
players.
But Doug Hyndman, the former chairman of the British Columbia Securities Commission who is leading
the transition office, presents an altogether different proposal, according to securities-industry
sources familiar with the plan.
The new regulator would not have a head office at all under the plan drafted by Mr. Hyndman, the
sources said. Instead, the regulator would operate from regional offices across Canada.
Offices would initially be set up in Toronto and Vancouver, cities in the two provinces that have
agreed to participate in a single regulator, the sources said.
Additional offices would be added in major cities as other provinces, which have the option of
voluntarily joining the national system, sign on.
Federal Finance Minister Jim Flaherty, the driving force behind a single regulator, has gone along
with the proposal, the sources said, in the hopes of persuading holdout provinces to throw their
support behind the national regulator.
Alberta and Quebec are leading the charge against it. For other provinces that are non-committal,
having the head office in Toronto would be a deal-breaker, the sources said.
If the thing is an export of the current Ontario Securities Commission to the rest of Canada, it
will never happen, said one of the sources who asked not to be named.
Mr. Hyndman and Mr. Flaherty did not return telephone messages on Monday.
The plan drafted by Mr. Hyndmans Canadian Securities Transition Office raises questions about the
power structure for the proposed regulator, which on the face of it appears to defeat the purpose
of having a single regulator by dispersing decision-making authority in different offices.
The plan will not come as a total surprise to Ontario government officials. Mr. Hyndman initially
floated the notion of having the regulator operate from regional offices back in March.
Chisholm Pothier, a spokesman for Mr. Flaherty, said at the time that Mr. Hyndmans office
recognizes that Toronto is Canadas largest financial centre. But those assurances did little to
allay the concerns of Ontario Finance Minister Dwight Duncan.
Ive heard some stuff about a virtual office, which in my view is just laughable, Mr. Duncan told
The Globe and Mail at the time. It would be an enormous slap in the face, both to Toronto and to
the financial services community, if it were not headquartered here.
The McGuinty government stressed the importance of having the head office in Toronto in the Throne
Speech last March, which included plans to make the city one of the worlds elite financial
centres.
It is not clear whether the Ontario government will withdraw its support if the head office issue
is not resolved to its satisfaction. Such a move could jeopardize the close relations Mr. McGuinty
has enjoyed in recent months with Prime Minister Stephen Harper.
An Ontario government official said on Monday the government is confident that it can persuade Mr.
Flaherty to change his mind and agree to set up a head office in Toronto. The talks so far, he
said, have been very collaborative.
Were still hopeful for Toronto, mostly because Toronto is the natural choice, he said.
***
THE SECURITIES STRUGGLE
THE ISSUE
Finance Minister Jim Flaherty has said that Canadas system of 13 separate regulatory authorities
is a costly and inefficient system that is also an international embarrassment. Critics point out
that Canada is the only member of the Group of Seven industrialized nations without a national
securities regulator.
WHOS ON BOARD
Ontario plans to support the federal governments case when the Supreme Court considers the
constitutionality of creating a national securities regulator later this year the first step in
the federal governments plan.
WHOS NOT
Alberta and Quebec have launched a united front against the federal governments plan for a
national securities regulator and say they hope to have other provinces join them. They have asked
Mr. Flaherty to stop the activities of the transition office now laying the groundwork for a
national regulator. Preparing for a national securities agency before a decision on the
constitutionality of the plan from the Supreme Court is a major distraction for all parties
concerned, they say.
Return to Top
2. Insurance firms lobby for two-tier accounting; Measure Of Capital
National Post
07/13/2010
JOHN GREENWOOD
Pg. FP1
Canadas life insurance companies are lobbying Ottawa and accounting standards boards to be allowed
to adopt a two-tier accounting system. The industry wants to avoid using a new international
standard that Canada has accepted but they fear would reflect negatively on their capital levels.
Essentially, the industry is proposing to use the International Financial Reporting Standards, or
IFRS, for public reporting purposes and a whole other set of rules when it comes to measuring
capital.
Frank Swedlove, president of the Canadian Life and Health Insurance Association, said both the
Finance Minister and the financial regulator are aware of the industrys concerns.
You would hope that [the regulator recognizes] a new accounting system that creates a lot of
volatility may not be the best way to determine what the capital levels should be, Mr. Swedlove
said.
Canadian companies have already begun the transition to IFRS, but the rules that the lifecos are
worried about
would not come into effect for at least another three years.
They would affect players in a number of ways and the industry is most concerned about what would
happen to capital levels, since these are the measures employed by the Office of the Superintendent
of Financial Institutions to determine the strength of a company. If capital is deemed to be
insufficient, companies can be forced to raise additional capital or even shut down.
So far most of the attention around IFRS has focused on balance sheet assets. Under current rules
the value of liabilities such as life insurance policies is linked to the assets backing them, so
that the two move in tandem.
But the IFRS rules dont allow that, which is expected to create huge volatility in earnings as
well as capital levels. Analysts dont know how rough the financial waters will be because the
International Accounting Standards Board, the body responsible for developing the new rules, has
yet to release details of the new rules.
This is the concern of some of the insurers, if youre going to disconnect the assets and the
liabilities, youre going to have a lot more volatility in the earnings, said Tom MacKinnon, an
analyst at BMO Capital Markets. Like, the assets go one way and the liabilities go another way,
and boom, that just squeezes out your capital.
The industry has some clout on the matter because life insurers in both the United States and the
United Kingdom both benefit from a two-tier accounting system that allows them to use one set of
rules for balance sheet purposes and another for the calculation of capital.
However, a senior OSFI official said it is too soon to look at changing the way capital is
calculated at least until a draft of the new IFRS rules is released later this summer.
Karen Strothers, a senior accounting director at the regulator, said OSFI may make changes to
capital calculations when the new rules become public depending on what we think are the
appropriate rules for the insurers. She said OSFI will alter its capital requirements if and when
it sees fit.
As for the request for separate accounting rules for capital, Ms. Strothers said that the setting
of accounting standards is the responsibility of the Canadian Accounting Standards Board rather
than OSFI.
But the Canadian Accounting Standards Board disagreed. It is the financial regulator, OSFI, who is
responsible for what capital requirements are and how you calculate them, said Peter Martin, the
director. He said the Insurance companies should be talking to OSFI.
According to Mr. Martin the IFRS rules are changing to reflect additional complexity that has made
its way into insurance company contracts. Im sure [the industry] would prefer separate rules for
capital because it would make their record keeping simpler, he said.
Return to Top
3. Finance Bill Close to Passage in Senate Democrats Clinch Support of Republicans Brown and
Snowe, Likely Reaching the 60 Votes Needed for the Legislation
The Wall Street Journal
07/13/2010
DAMIAN PALETTA and VICTORIA McGRANE
Pg. A3
Two Senate Republicans said Monday they would support the Obama administrations financial-overhaul
legislation, and Democrats now believe they have the 60 votes needed to push the sweeping bill into
law by the end of the week.
Sens. Scott Brown of Massachusetts and Olympia Snowe of Maine both said they would vote for the
measure when Democrats bring it to a vote, which could happen as soon as this week. Democrats and
administration officials believe this gives them the necessary backing to overcome a potential
filibuster after weeks of uncertainty and unexpected pitfalls.
Because the House of Representatives passed the bill by a 237-to-192 margin several weeks ago,
Senate passage would send the bill to the White House, where President Obama is expected to quickly
sign it into law.
It is a better bill than it was when this whole process started, Mr. Brown said. While it isnt
perfect, I expect to support the bill when it comes up for a vote.
All three Republicans expected to vote for the bill secured changes to the bill addressing pet
issues or constituent concerns.
Sens. Snowe and Brown withheld support during the July 4 recess, saying they needed more time to
study the bill. They will join Sen. Susan Collins (R., Maine) as three Republicans who have now
committed to vote for the bill. Their votes offset the loss of Democratic Sen. Russell Feingold of
Wisconsin, who said he would vote against the bill, and Sen. Robert Byrd, who died last month and
has not yet been succeeded.
Senate Majority Leader Harry Reid (D., Nev.) said the Senate would now finish our work on this
bill this week to ensure that these critical protections and accountability for Wall Street are in
place as soon as possible.
Still, even with the support of the three Northeastern Republicans, the vote remains on a knifes
edge, with just 60 expected in support. Sowing a fresh element of doubt, Sen. Ben Nelson (D., Neb.)
said Monday he had not decided whether to vote for the bill because of concerns over whom the White
House would name as head of a new consumer-lending regulator.
The math appears, nonetheless, to have finally lined up for the White House, which has pushed to
overhaul financial regulations for more than a year, despite fierce resistance from business groups
and many Republicans. White House and Treasury Department officials declined to comment on the
developments.
Many Republicans have panned the bill, saying it would drive up the costs of credit and harm the
U.S.s competitiveness. They have also complained that the bill does little to address Fannie Mae
and Freddie Mac, the mortgage finance giants that have remained under government control since
2008.
But almost all Democrats and now a handful of Republicans have said the bill makes structural
changes to the oversight of regulation that would fix problems exposed during the financial crisis.
Democrats made the bill a major domestic priority, and some hope the new layers of regulation on
finance will appeal to voters during the November midterm election.
The bill would tighten regulations governing almost every corner of financial markets, in a bid to
prevent another financial crisis and better handle one if it arrives.
The bill would boost powers of agencies such as the Federal Reserve and Securities and Exchange
Commission, create a new regulator to monitor consumer lending rules, give the government the power
to break up failing companies and toughen scrutiny over exotic financial products like derivatives.
If the bill becomes law, the banking industry is expected to shift their lobbying focus from
Capitol Hill to the bank
regulators, which will have the job of writing hundreds of new policies to
implement the new rules.
The regulators discretion will likely be a flashpoint in coming days, as signaled by the concerns
raised by Mr. Nelson on Monday about the consumer agency, which is designed to operate
independently of other regulators.
Cognizant that Democrats needed Republican support, the White House agreed to multiple changes in
recent months.
To win Mr. Browns support, Democrats limited the bills impact on asset-management and mutual-fund
companies. They also scrahpped a levy on large banks and hedge funds.
To win backing from Ms. Snowe, Democrats agreed to an amendment resisted by liberal groups that
could exempt many small businesses from the reach of the new consumer regulator.
Return to Top
4. VIDEO CLIP: CNBC Fast Money Halftime Report
CNBC
07/12/2010
To play clip in a separate window, click here.
To watch a clip about an analyst talk about TD stock, click here.
Program: Fast Money Halftime Report
Station: CNBC
Date: 7/12/2010
Canadas second largest bank TD continues its expanding presence in the U.S. Predicting bank
profits to double over the next three years. Joining us live from Toronto is Ed Clark, president
and CEO of TD Financial. Ed Clark interviewed.
Return to Top
5. TD targets energy sector deals worth $100M-plus; Acquisition of city firm adds to banks
technical expertise
Calgary Herald (Reuters)
07/13/2010
CAMERON FRENCH and PAV JORDAN
Pg. D7
Toronto-Dominion Bank will use the new expertise it acquired with Calgarys Ross Smith Sousa to
access large private deals in Canadas oil and gas sector, aiming for transactions of $100 million
or more, a top executive said Monday.
Canadas second-largest bank said late last week it acquired Ross Smith Sousa Advisors for an
undisclosed amount in a deal aimed at boosting its investment banking presence in the energy
sector, starting with two major deals.
Weve got two mandates out of the gate, one for Shell and one for Encana, and those are the kind
of people we want to be working for, said Drew MacIntyre, vice-chairman of the TDs investment
banking arm, TD Securities.
Wed be in the larger production, $100 million-plus range.
MacIntyre could not comment on the size of the Encana Corp. or Royal Dutch Shell mandates, saying
only that they were worth much more than the $100-million target range.
TD has been retained by Encana, the countrys largest natural gas producer, as exclusive financial
adviser on the sale of certain gas and oil assets. It was also retained to sell certain natural gas
assets of Shell Canada.
MacIntyre said that in purchasing Ross Smith Sousa, TD was adding technical expertise to help it
appraise assets, adding scope to existing M&A business in asset acquisition and divestitures in oil
and gas.
What were seeing is that this is going to be a busy year not a record year, but a busy year,
said MacIntyre. That would be split between corporate deals and asset deals, and so we want to be
active on both sides of that equation.
A corporate deal involves the acquisition of public stock to take control of a company, as opposed
to the acquisition of individual assets.
MacIntyre said the bank hopes to target more business among existing investment banking clients
selling bigger strategic assets.
TD is boosting its already considerable presence in Canadian mergers and acquisitions at a time
when deal-making is picking up in the energy sector on the back of improving credit markets and a
stronger economy.
It also follows an acceleration in foreign investment in Canadian oil and gas assets, particularly
from buyers in Asia such as China and South Korea.
Return to Top
6. La TD sintéresse aux métaux précieux [TD is interested in precious metals]
Finance et investissement
07/13/2010
Les services de courtage de la TD sapprêtent à embaucher une douzaine de spécialistes de lor, de
largent, du platine et du palladium.
Ces spécialistes seront principalement basés à Toronto. Certains travailleront à partir de Londres
et de Singapour.
Ce faisant, la banque TD entend élargir ses parts de marché dans ses services dinvestissement
destinés au secteur minier, en pleine ébullition, notamment en matière de fusions et acquisitions.
La Banque pourrait également accroître son offre de service auprès des manufacturiers ayant des
besoins spécialisés en métaux précieux.
TD pourrait aussi développer une expertise en matière de produits structurés liés à lor, ce qui
rejoindrait les investisseurs individuels.
Il reviendra à un ex-courtier de la firme Mitsui & Co., Tim Gardiner, de diriger cette nouvelle
équipe.
Ces spécialistes seront principalement basés à Toronto. Certains travailleraient à partir de
Londres et de Singapour. Il reviendra à un ex-courtier de la firme Mitsui & Co., Tim Gardiner, de
diriger cette équipe.
Ce faisant, la banque TD entend élargir ses parts de marché dans ses services dinvestissement
destinés au secteur minier, en pleine ébullition, notamment en matière de fusions et acquisitions.
La Banque pourrait également accroître son offre de service auprès des manufacturiers ayant des
besoins spécialisés en métaux précieux.
TD pourrait aussi développer une expertise en matière de produits structurés liés à lor, ce qui
rejoindrait les investisseurs individuels.
Return to Top
7. Banks, baubles and a battle for your money
The Globe and Mail
07/13/2010
ROB CARRICK
Pg. B10
Can you be bribed?
The big banks think so. Theyre offering cash up to $250 as well as reward points to get people
to switch their chequing accounts, credit cards and mortgages.
Change for changes sake in banking is pointless. Its time-consuming and potentially costly
because you expose yourself to a whack of fee-laden fine print at the new and unfamiliar bank.
But if youre already thinking about bailing on your bank and are ready to ask a lot of questions,
these deals are worth a look.
Toronto-Dominion Banks TD Canada Trust division has been promoting a deal lately that offers up to
$250 in cash to customers. All you have to do is open a Select Service or Infinity chequing account
by July 23, and be approved for one of four TD Visa cards.
Read down the offer (check it out here: bit.ly/cAmUQe) and youll find a few more requirements.
Either you have to set up a recurring direct deposit and two pre-authorized debits, or sign up for
the banks Simply Save program. Thats where money is automatically deposited into a savings
account every time you use your client card for debit transactions or bank machine withdrawals. You
also have to make 10 purchases on your new credit card by Sept. 30, 2010.
Lets look at what youre getting into here. TD Select Service is a premium account allowing
unlimited transactions and the monthly cost is $24.95. This fee can be reduced to $12.95 per month
with the Infinity account, which also includes any number of credits and debits. You can have these
fees waived by keeping $3,000 in an Infinity account and $5,000 in Select Service, but overdraft
protection costs $3 per month.
As for the Visa cards eligible for this deal, theyre reward cards that charge annual fees of $99
to $120. With fees like this, TD can easily make back the $250 its giving you in 12 months or
less. But thats not the only benefit to the bank.
Its also encouraging you, the customer, to be a cheap source of money it can use elsewhere to make
lots of money.Theres an awful lot of profit that comes from retail banking, and the most
profitable element of retail banking is chequing-savings accounts, explained David McVay, a
consultant with McVay and Associates. Select Service and Infinity are typical of their kind in
paying zero interest. Whatever you put in these accounts is
essentially free money for the bank to
lend out at rates of 2.5 per cent, the current prime rate, or more.
Royal Bank is trying something similar by offering RBC rewards to clients who are switching banks.
Open an RBC Signature No Limit bank account, monthly fee $13.95, and you get 10,000 points. Thats
more than enough to get a $75 Future Shop gift card. Add an RBC Visa Infinite Avion card, annual
fee $120, and youve got the points for a short-haul flight.
Note that RBC has a multi-product rebate, so you could cut your fees by giving the bank all or most
of your business.
Both TD and RBC are targeting chequing accounts and the reason is that theyre a gateway product
for selling all kinds of other stuff to customers.
If youre a bank, almost all your [retail banking] profit comes from people who operate their
chequing accounts with you, Mr. McVay said. Once youve chosen where youre going to do your
everyday banking, thats where youre most likely to get your mortgage, personal loans and do your
investing.
Other banks have taken a different approach to attracting new clients. Canadian Imperial Bank of
Commerce is promoting lines of credit and mortgages using cash and fee waivers. For example, a
set-up service fee of $499 is waived for the Home Power line of credit.
Two facts you should know if you bite on this offer: You must have a balance on your credit line
averaging $30,000 in the four months after you open it, and you have to take a rate of 3.5 per cent
(prime plus a percentage point). Thats been the standard rate in the wake of the financial crisis,
but you might be able to do better today.
Elsewhere, Bank of Montreal is offering free banking for a year for new Canadians, while Bank of
Nova Scotia is offering to match contributions to various savings and investing products with a
10-per-cent bonus of up to $150.
If you can collect these bonuses by making a switch you were already thinking about, then snap em
up. Otherwise, the bonus wont be worth it.
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8. Grant is not just a public relations gesture
Guelph Mercury (ON)
07/13/2010
KAREN CLARKE-WHISTLER
Re: City gets cash for carbon credits, July 7.
TD is pleased to see the City of Guelph receive $1 million from the Greening Canada Fund. In
practical terms, the fund helps communities become more green by investing in energy efficiency
projects at schools and hospitals and providing funding for solar panel installations at
non-profits and other local organizations just to name a few examples. Guelph residents will see
improvements at the Eastview landfill site that will help to capture more methane gas. We think
investing in the fund to help bring these important projects to life is hardly a public relations
gesture (by the banks) as suggested by University of Guelphs Ross McKitrick.
Through our environment strategy weve been able to reduce our paper consumption, increase our
energy efficiency by retrofitting lighting and improving heating and cooling systems, and were
even installing solar panels to generate energy at some of our branches. And for the past two
years, weve been using renewable energy for our operations in five provinces and for our network
of 2,700 automated banking machines.
Its our hope that other corporations see the value of investing in the Greening Canada Fund as an
impactful way to support greener communities across Canada.
-Karen Clarke-Whistler, chief environment officer, TD Bank Financial Group, Toronto
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9. Kids visit library jungle
Timmins Daily Press (ON)
07/13/2010
CHELSEY ROMAIN
Its a jungle adventure that not only encourages children to have fun, but to fill their summer
holiday with books.
For several years now, TD Canada Trust has been teaming up with the Timmins Public Library to
ensure reading remains an integral part of local childrens lives even when school isnt in
session.
About 25 children ages four to 13 were on hand to help launch the TD Summer Reading Club Monday, as
organizers unveiled the Destination Jungle theme.
The youngsters were provided with fake airline tickets and passports before being boarded on a
plane that would take them deep into the jungle. Library staff acted as flight attendants and
pilot, while TD Canada Trust representatives were seated in first class.
This really encourages the children to read, said library early childhood advisor Francine Denis.
If they dont keep reading throughout the summer, most children will lose some of their literacy
skills for their next grade.
A big part of launching the program is showing the children how reading can be fun. Denis said they
could easily just explain what the program is, but they want to be able to capture the kids
attention.
We want to encourage the students to keep coming back and show there is always something new at
the library, she said. We want them to read over the summer not because they have to, but because
they want to.
The club, which offers both English and French books, meets every Monday at 1:30 p.m. in the
librarys Tembec room. TD Canada Trust offers the program free of charge, and every child who
participates receives an interactive poster with stickers and a booklet with a calendar to record
their daily reading minutes.
The child with the most reading time at the end of the program will receive a prize. Other prizes
are also available throughout the six-week period. The books children will read are available
through the library.
TD Canada Trust has been offering the program throughout Canada for 15 years. Financial service
representative Ginette Dubé said the bank is very supportive of anything to do with helping
children.
This is the largest TD summer club in Canada, said South Porcupine branch manager JoAnne
McCooeye. It encourages them to read at a very young age and is a fun, free program.
Were proud to be able to offer this program because it helps children become more involved with
literacy.
Denis said the program also helps introduce younger children to what the library has to offer.
Seeing new faces is a bonus to the summer reading club, but she said they hope to see even more new
faces as the weeks go on.
Children who did not attend Mondays launch are welcome to join up in the following weeks, and
attendance is not mandatory every week.
The program continues until Aug. 23, with the exception of the Civic Holiday on Aug. 2.
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10. TD Bank at center of beach parking probe
Gloucester Daily Times (MA)
07/13/2010
PATRICK ANDERSON
The search for around $5,000 in missing city beach parking revenues has turned to TD Bank, which
has launched its own internal investigation into whether the money may have disappeared while in
its care. Gloucester police, who had first questioned beach employees about the missing money after
being alerted to discrepancies in parking receipts, said Monday they were awaiting the result of
the banks probe before taking the next step in their investigation.
We are still working with the bank, Gloucester Police Chief Michael Lane said Monday. The bank
is doing their own internal investigation, and that is where we are now focusing.
Few details about the missing money have been made public by either law enforcement officials or
the city. Police started investigating late last month after city Treasurer Jeffrey Towne flagged
troubling results within the internal controls for the beach accounts. The city has not released
the identity of the bank involved, but records and police reports over the past few weeks have
shown that TD Bank, which has two branches in Gloucester, anchored by its offices on Harbor Loop,
handles the city beach receipts.
TD Bank spokeswoman Rebecca Acevedo confirmed Monday that the bank was the subject of the
investigation. We take these matters very seriously and are conducting our own internal
investigation as well as cooperating fully with local authorities, Acevedo said. As to not
jeopardize that, we cant comment further.
The focus of the investigation shifted from city employees to the bank, Mayor Carolyn Kirk has
said, after irregularities turned up in at least one deposit to the bank over the busy Fourth of
July weekend. In fact, over this past weekend, TD Bank called Gloucester police concerned that
another bag of beach money had gone missing. As it turns out, the money was not missing; it had
already been counted and the bag returned to the beaches. Gloucester may be particularly sensitive
to suspicious activity at its beaches because of a history of larceny at the municipal parking
lots, which appear to present an irresistible target for thieves. In 1982, five city employees,
including three public school teachers, were arrested following a stakeout of the Wingaersheek
Beach parking lot on charges they were pocketing non-resident parking fees.
An audit by the city conducted after the arrests estimated that part-time parking lot attendants
had taken $156,149 from Wingaersheek and Good Harbor beaches between 1981 and 1982. Some have said
that figure is low. On a smaller sale, just last week, with the investigation underway, a pushcart
vendor selling slushies at Good Harbor Beach was robbed by a group of young people. No arrests have
been made in that case. During beach seasons, city employees deposit the money from the parking
lots daily in a bank deposit box, sometimes twice a day. The Fourth of July weekend brought heavy
crowds and large numbers of cars to both Wingaersheek and Good Harbor, where parking was restricted
to residents only for periods of time. Such days are known to pull in as much as $17,000 in parking
fees. The city has reported no shortages or irregularities in the beach deposits since the Fourth
of July period.
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11. La Scotia et la BMO dans le tourbillon Earl Jones [Scotiabank and BMO in the Earl Jones whirlwind]
Argent
07/13/2010
OLIVIER BOURQUE
La Banque Royale avait déjà été visé par le groupe des victimes dEarl Jones. Depuis le début de
laffaire Earl Jones, les victimes ont souvent pointé la Banque Royale comme une des responsables
de leur malheur. Mais voilà que deux autres institutions pourraient aussi être prises dans le
tourbillon de lex-financier déchu.
Selon Ginny Nelles qui représente les victimes dans le recours collectif, une audition se déroulera
le 14 juillet afin de vérifier la validité de laction judiciaire contre la RBC.
«On espère que le juge va établir que nous pouvons faire ce recours collectif», a-t-elle souligné
en entrevue avec Argent. La succursale de Beaconsfield où Earl Jones possédait un compte en
fidéicommis est visé plus particulièrement.
Dans un rapport déposé lan dernier, le syndic de faillite avait constaté que M. Jones avait fait
des retraits personnels ou irréguliers de 12,3 millions $ sur 15 ans dans le compte de ses clients
de cette succursale de lOuest de lÎle. Le conseiller avait également accès à une carte de débit
et pouvait retirer à sa guise.
La Scotia et la BMO dans le viseur
Mais dautres institutions financières sont aussi dans le viseur de certaines des victimes. M.
Jones aurait contracté des hypothèques très coûteuses pour onze des victimes à la Banque Scotia et
la Banque de Montréal.
«Onze personnes âgées pourraient donc perdre leur maison. Jones contractait des hypothèques de 40
ans pour des personnes de 70 ans ! Cela na aucune allure. Donc on est en train dinvestiguer»,
affirme Mme Nelles.
Selon elle, les avocats du groupe sont très encouragés de laction en cours. Plusieurs informations
ont été colligées en vue de monter le dossier.
«Nous avons beaucoup de documentation disant que la banque a été négligente», a précisé Mme Nelles.
Entente avec les banques
Questionnée à savoir si le groupe croit fermement pouvoir obtenir un dédommagement à lissue des
actions judiciaires, Mme Nelles affirme que la collaboration des institutions financières sera
nécessaire.
«Nous allons sûrement travailler avec les banques pour trouver une entente», a-t-elle précisé.
La centaine de victimes sest dailleurs regroupé hier à Pointe-Claire afin de structurer leurs
actions des prochaines semaines. Cest le bureau davocats Stein et Stein qui travaille sur le
dossier.
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12. Banks survey shows businesses upbeat about economic recovery; Confidence Results may pave way for interest rate hike
The Canadian Press
07/13/2010
JULIAN BELTRAME
Pg. B3
Canadian firms are giving the recovery a vote of confidence in a key quarterly survey, paving the
way for the Bank of Canadas expected interest rate hike next week.
The central banks quarterly survey, released Monday, showed firms were concerned about the
fall-out from the European sovereign debt mess, but still generally upbeat about the coming year.
Overall, (business executives) are positive about the outlook for business activity over the next
12 months, the bank wrote.
For the first time in two years, firms, on balance, reported an improvement in their past sales
activity.
The banks governing council next interest rate announcement is next Tuesday.
Following a strong jobs report last week, the survey likely represents the last piece of evidence
governor Mark Carney was looking for to confirm a pre-disposition to continue raising rates.
Id say theres a 75 or 80 per cent probability they will hike next week by 25 basis points, said
Derek Holt, vice-president of economics with Scotia Capital.
I think theyd want to avoid the perception that they just came out with a whole new round of
bullish forecasts and then got wobbly knees after just one quarter-point hike (in June).
What could stay Carneys hand, economists say is the unknown factor of what will happen to the
global economy as governments move from spending to restraint later this year and next.
Canadas domestic economy appears well grounded. Statistics Canada reported on Friday that an
additional 93,000 jobs were added in June, bringing total re-hiring since the recessions end to
over 400,000.
And the business outlook survey showed that 50 per cent of firms surveyed said they planned to add
workers over the next 12 months, as opposed to only 10 per cent that planned to cut their
workforce.
TD Bank economist Diana Petramala viewed that finding as the strongest in the report, although she
said it might indicate some hiring thats already taken place.
While an increase in the banks policy rate to 0.75 per cent will raise short-term interest rates
for consumers, most economists say it is unlikely to have much of an impact on longer-term, fixed
mortgage rates. Many see a hike at this time as not applying the brakes to growth, since the rate
would remain near the historic low, but as a judgment by the bank that the recovery is taking hold.
Not all agree, however. A bearish minority argue that Canada still faces considerable headwinds
from the European situation and ongoing U.S. weakness, and that Carney should refrain from adding a
further impediment to growth.
But failing a climb down from its forecast of 3.7 per cent growth this year, and 3.1 per cent next
year, the bank appears on track to take interest rates a little higher next week, analysts say.
With price pressures expected to rise in the production line, excess economic slack continuing to
melt away, and credit and lending conditions continuing to ease, the survey results weigh on the
tightening side, noted economist
Michael Gregory of BMO Capital Markets.
The summer poll, and a separate survey of loan officers also released Monday, found sentiments
positive, if not deliriously so, across a range of topics.
The bank said credit conditions appear to be easing, especially for larger corporations, a critical
pre-requisite for expansion.
The balance of opinion was also positive on questions of sales volume prospects for the coming
year, and future investment intentions.
Not all doubts have vanished, however.
Business executives expressed concerns about recent global economic and financial uncertainties
and possible spillover effects in Canada.
And although on the plus side of the ledger, expectations on future sales and investment intentions
were softer than three months ago. Thats partly because of the way the Bank of Canada couches its
questions, contrasting expectations to what they were in the earlier survey.
The bank noted the responses suggest that firms that have already experienced strong sales growth
from recession lows now believe that the growth rate will slow to more sustainable levels, but
remain positive.
And many firms that do not expect to increase spending on new machinery have already made those
investments, particularly firms in the services sector.
On other elements of business activity, executives said they expect the cost of their inputs to
increase at a greater rate during the next 12 months, and plan to pass on these cost increases to
their customers.
But the inflationary expectations over the next two years were modest, within the central banks
one-to-three per cent range.
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13. Les entreprises plutôt optimistes [Companies pretty optimistic]
La Presse
07/13/2010
RUDY LE COURS
Les entreprises canadiennes sont suffisamment optimistes pour que la moitié dentre elles songent à
grossir leurs effectifs au cours des 12 prochains mois.
Selon les résultats de lEnquête sur les perspectives des entreprises (EPE) menée par la Banque du
Canada entre le 19 mai et le 15 juin derniers, lensemble dentre elles ont observé une
amélioration de leurs ventes passées, une première en deux ans.
La majorité estiment aussi que leur chiffre daffaires va également saméliorer
au cours des 12 prochains mois. La proportion est cependant moins élevée quau cours des trois
enquêtes trimestrielles précédentes.
On peut en dire autant de celles qui comptent accroître leurs investissements en machine et
matériel. La Banque fait cependant observer que ce léger recul est attribuable au secteur des
services quand les répondants ont
précisé avoir déjà réalisé de forts investissements. Les
répondants issus du secteur des biens maintiennent leurs intentions dinvestir.
Quel que soit le secteur, une entreprise sur deux veut embaucher, malgré le fait quelles lont
beaucoup fait durant le printemps. «Compte tenu des embauches très fortes en juin (93 200), cela
suggère que la tendance à la croissance de lemploi demeure robuste», estime Michael Gregory,
économiste principal chez BMO marchés des capitaux.
Tout près de deux répondants sur cinq affirment fonctionner à quasi plein régime. Ils éprouveraient
quelques difficultés à faire face à une hausse inattendue de la demande.
Signe que lexcédent de capacité est de plus en plus absorbé, près de la moitié des répondants
sattendent à une hausse des prix de leurs intrants et de leurs extrants. On ne sera pas surpris
dès lors quaucun dentre eux ne sattende à ce que lindice des prix à la consommation passe sous
la barre de 1%. Cest une première depuis les débuts de lEPE en 1998. «Les entreprises demeurent
confiantes dans la poursuite de la reprise, analyse Diana Petramala, économiste chez Groupe
financier Banque TD. Toutefois, les résultats de lEPE semblent indiquer que son rythme commence à
ralentir.»
Les entreprises jugent enfin que les conditions de crédit continuent de sassouplir. Cette
perception est confirmée par lautre enquête de la Banque menée auprès des responsables du crédit.
Elle fait état dun assouplissement général du crédit tant dans les modalités tarifaires (taux
dintérêt) que non tarifaires (critères de sélection).
Cet assouplissement est moins prononcé toutefois auprès de la PME. Cette précision semble
corroborée par le Baromètre mensuel des affaires, publié par la Fédération canadienne de
lentreprise indépendante. En juillet, il signale un léger fléchissement de la confiance qui serait
conforme à une croissance de lordre de 2,5% en rythme annuel.
«Les entreprises canadiennes nont pas peur de prendre des décisions, procurant ainsi un bon coup
de pouce à lactivité économique, contrairement à leurs homologues américaines qui préfèrent garder
sous le matelas une panoplie dactifs financiers liquides», résume Sébastien Lavoie, économiste
principal chez Valeurs mobilières Banque Laurentienne. Il sattend donc à une hausse du taux
directeur de la Banque du Canada, le 20 juillet.
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14. A skills squeeze is around the corner, and we must prepare and adapt
The Vancouver Sun
07/13/2010
JAY BRYAN
Pg. A11
Although unemployment is dropping, its still a big preoccupation, a fact underlined last week by
the Organization for Economic Cooperation and Development, which warned governments mustnt take
their focus off joblessness just because theres a recovery.
Thats true, of course, but the remarkable thing is that at the same time, theres what one analyst
calls a remarkably high proportion of businesses in Canada that cant find all the workers they
need. Examples would be health care and mining.
That analyst is Glen Hodgson, who is chief economist at the Conference Board of Canada, and he
predicts that, within about three years, this shortage will be serious and widespread.
One reason is Canadas economy is healthier than most, but probably a bigger one is a rush to the
exits thats
expected among the huge group of 2.9 million baby-boom workers who are older than 55
and eyeing retirement. As a result, the unemployment rate will be approaching six per cent within
three years, estimates Hodgson.
This is encouraging for job-hunters, but worrisome for employers. Its also worrisome for
economists who wonder what will happen to this countrys ability to maintain economic growth at the
pace were used to.
This scenario is not just one persons opinion. The Toronto-Dominion Banks long-term economic
forecast predicts unemployment will fall rapidly over the next few years, averaging just 6.5 per
cent by 2013 and 6.1 per cent in the following two years.
But a stunningly big part of this change doesnt come from job gains. In fact, employment in the
next five years will grow more slowly than it did during the prosperous pre-recession years: at an
average annual pace of just 1.5 per cent, down from the 1.8 per cent we saw in the period from 2004
through 2008, according to calculations from Derek Burleton, deputy chief economist at
Toronto-Dominion.
The forecast drop in unemployment can largely be laid at the feet of faltering gains in Canadas
labour force, with the Toronto-Dominion estimate of annual growth in the workforce plunging to an
average just one per cent between now and 2014. Thats down by one-third from the 1.5-per-cent
average pace during the five pre-recession years.
Also, Canadas potential economic growth rate will also fall by approximately one-third, to two per
cent annually from three per cent, Hodgson estimates. Thats not the end of the world, but it has
costs. A slower-growing economy can still be very prosperous for examples, look to Japan or
Europe. On the other hand, it can also offer fewer opportunities for entrepreneurs or for graduates
trying to start a career.
Theres not any complete solution for Canadas demographic slowdown. Its just a fact of life to
which well have to adapt. Part of this could be learning how to work smarter, with more
sophisticated equipment and better work organization. This could boost Canadas lagging
productivity growth, partly offsetting the labour shortfall.
But a big part of adapting successfully should include an effort to soften the demographic squeeze
by opening the doors more widely to skilled immigrants, Hodgson suggests. Simply boosting the
number of immigrants admitted because of their skills would be a start, but Hodgson and other
analysts have pointed out that we waste the skills of many immigrants by failing to recognize their
credentials. Thus we see the sad phenomenon of trained engineers and doctors driving taxis,
sometimes while their skills are badly needed.
While were struggling to sort out the credential mess, which is tangled up in interprovincial
barriers and interest-group politics, one interim fix would be simply to ease the path of foreign
students to immigrant status, Hodgson suggests.
After all, theyre fluent in English or French, we understand their credentials, and theyre
already here.
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(http://www.sec.gov). Des exemplaires de la circulaire de sollicitation de
procurations/prospectus définitif et des documents déposés auprès de la SEC qui seront intégrés par
renvoi dans la circulaire de sollicitation de procurations/prospectus définitif peuvent aussi être
obtenus, lorsquils seront disponibles, sans frais, en soumettant une demande à The
Toronto-Dominion Bank, 15th floor, 66 Wellington Street West, Toronto (Ontario) M5K 1A2, à
lattention de : Relations avec les investisseurs, 1-866-486-4826, ou à The South Financial Group,
Inc. Investor Relations, 104 South Main Street, Poinsett Plaza, 6th Floor, Greenville, South
Carolina 29601, 1-888-592-3001.
La Banque Toronto-Dominion, The South Financial Group, Inc., leurs administrateurs et dirigeants
respectifs et dautres personnes peuvent être réputés être des participants à la sollicitation de
procurations relativement à lopération de fusion proposée. Linformation concernant les
administrateurs et les dirigeants de La Banque Toronto-Dominion est disponible dans son rapport
annuel sur formulaire 40-F pour lexercice terminé le 31 octobre 2009, qui a été déposé auprès de
la SEC le 3 décembre 2009, et dans son avis de convocation à son assemblée annuelle et circulaire
de procuration de 2010, qui a été déposé auprès de la SEC le 25 février 2010 et dans la déclaration
denregistrement sur formulaire F-4 susmentionnée, qui a été déposée auprès de la SEC le 10 juin
2010. Linformation concernant les administrateurs et les dirigeants de The South Financial Group,
Inc. est disponible dans la circulaire de sollicitation de procurations de The South Financial
Group, Inc. à légard de son assemblée annuelle de 2010, qui a été déposée auprès de la SEC le 7
avril 2010. Dautres renseignements sur les participants à la sollicitation de procurations et une
description de leurs intérêts directs et indirects, par titres détenus ou autres, sont inclus dans
la déclaration denregistrement susmentionnée sur formulaire F-4, qui a été déposée auprès de la
SEC le 10 juin 2010, et dautres documents pertinents qui seront déposés auprès de la SEC
lorsquils seront disponibles.
THE FOLLOWING IS A COMMUNICATION SENT TO EMPLOYEES OF TD BANK, AMERICAS MOST CONVENIENT BANK AND THE
TORONTO-DOMINION BANK ON JULY 13, 2010
Daily News Brief
July 13, 2010
Compiled by Brittany Roberge, Corporate and Public Affairs
TD BANK NEWS
1. |
|
Fast Money Transcript - Interview with Ed Clark - CNBC |
MELISSA LEE (CNBC-TV): Despite uncertainty over financial regulation, TD, Canadas second-largest
bank, continues expanding presence in the United States, now projecting their US bank profit to
double over the next three years. Joining us live from Toronto is Ed Clark, president and CEO of TD
Bank Financial. Ed, nice to see you.
2. |
|
Sun Bancorp Still Closing 2 Branches - Philadelphia Business Journal |
Sun Bancorp received a $100 million cash infusion from billionaire Wilbur Ross Jr. and other
investors last week, but it still plans to close two of its three branches in Salem County, N.J. In
a story first reported on NJ.com, Suns senior vice president for consumer banking, Douglas Smith,
said the closings were because of a confluence of circumstances, but he fingered the recession as
a main culprit. [TD Bank is mentioned.]
3. |
|
TD Bank At Center Of Beach Parking Probe - Gloucester Daily Times (MA) |
The search for around $5,000 in missing city beach parking revenues has turned to TD Bank, which
has launched its own internal investigation into whether the money may have disappeared while in
its care. Gloucester police, who had first questioned beach employees about the missing money after
being alerted to discrepancies in parking receipts, said Monday they were awaiting the result of
the banks probe before taking the next step in their investigation. [TD Banks Rebecca Acevedo is
quoted.]
4. |
|
TD Ratchets Up Overdraft Opt-In Push With Pop-Up Scare Tactics |
- Consumerist.com (blog)
TD Bank is really stepping up its efforts to try to get customers to sign back up for overdraft
protection, which really just protects their right to charge you $35 if you want to buy a $2.00
candy bar and only have a $1 in your account. Now theyre greeting customers accessing their
accounts online with pop-up ads trying to scare them into agreeing to signing up for the service.
5. |
|
Banking On Big Names No More - Gloucester County Times (NJ) |
Though it will not revert to just another high school auditorium, the once expansive offerings of
the TD Bank Arts Centre in Washington Township have been cut back. [TD Bank is mentioned.]
6. |
|
Earnhardt Grandson To Race TD Bank 250 |
Page 1 of 16
- Morning Sentinel (ME) [Article also appears in Kennebec Journal (ME) and The Sun Journal
(ME).]
Jeffrey Earnhardt, grandson of auto racing legend Dale Earnhardt, has entered the TD Bank 250 on
Sunday, July 18 at Oxford Plains Speedway.
The following article is attached as a PDF:
7. |
|
Marginal Borrowers Might Get 2nd Chance |
- Eastern Pennsylvania Business Journal
Banks say the have money to lend. On June 23 TD Bank had what it called a full-scale blitz in
Lehigh, Bucks, Montgomery, and Delaware counties targeting small business prospects.
INDUSTRY NEWS
1. |
|
Finance Bill Close to Passage in Senate - Wall Street Journal |
Two Senate Republicans said Monday they would support the Obama administrations financial-overhaul
legislation, and Democrats now believe they have the 60 votes needed to push the sweeping bill into
law by the end of the week.
2. |
|
Small-Business Lending Is Down, but Reasons Still Elude the Experts |
- New York Times
The chairman of the Federal Reserve urged banks and regulators on Monday to help the nations small
businesses get the loans they needed to create jobs. He also acknowledged that economists could not
agree on why such lending has contracted substantially over the last two years.
3. |
|
B of A Merrill Retirement Services Buildup Showing Results - American Banker |
Bank of America Merrill Lynchs expansion of its retirement services business is picking up
momentum. Enlarging the operation has been a key initiative for the Charlotte company for the past
year, and its recommitment to the business is really beginning to see results in terms of sales
traction in the marketplace, Andy Sieg, head of B of A Merrill Lynch retirement and philanthropic
services, said in an interview last week.
4. |
|
FDIC Board Beefs Up Exam Powers - American Banker |
The Federal Deposit Insurance Corp. board took steps Monday to respond to criticism that the FDIC
was hindered from using its backup examination powers aggressively enough during the financial
crisis to protect the deposit insurance fund.
5. |
|
Citigroup Bondholder Suit Can Go Forward, Judge Rules - Bloomberg News |
A lawsuit claiming that Citigroup Inc. misled investors who bought 48 issues of its corporate bonds
offered from May 2006 to August 2008 can go forward, a federal judge in New York ruled.
Page 2 of 16
TD BANK NEWS
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1. |
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Fast Money Transcript Interview with Ed Clark
July 12, 2010 CNBC |
MELISSA LEE (CNBC-TV): Despite uncertainty over financial regulation, TD, Canadas second-largest
bank, continues expanding presence in the United States, now projecting their US bank profit to
double over the next three years. Joining us live from Toronto is Ed Clark, president and CEO of TD
Bank Financial. Ed, nice to see you.
ED CLARK (President and CEO, TD Bank Financial): Nice to see you, Melissa. I always watch your
program, and now its fun to be on it.
MELISSA LEE: Oh, great. Were happy to have you. I want to take your lead from your most recent
investor meeting and focus in on the US operations, because it was a very bold goal that you
outlined in terms of one-point-six billion in annual earnings for the next three years. Theres a
few ways you can achieve that, and one is improving loan losses. Im curious, what... what is the
trend that youre seeing right now here in the US?
ED CLARK: Yeah, so weve definitely seen a turn in the US. Our non-performers and... if you
reported last quarter, were flat, and we... you know, as we look forward, we see that declining and
our loan-loss provisions declining at a pretty steady pace. So I would say that were actually
quite positive on... on the US environment. The other thing that drives those earnings-growth,
though, is that weve been aggressively growing, so were the only bank of the top 10 in 2009 to
increase its lending, and were increasing our lending again in 2010, so I think well be
distinguished in the market again this year.
MELISSA LEE: What kind of loans are you focusing in on? You know, I was reading some analysts
reports, and what struck me is that you have mortgage and refinancing nowadays, and two years ago
you didnt have that at all.
ED CLARK: Right, so obviously theres been a big disruption in the mortgage market, and so for us,
thats a great place for us to go. Were obviously very big in that in Canada, but we see ourselves
now cross-selling that product to our consumers in the United States, and so we... we think thats
a huge opportunity right now in the marketplace.
MELISSA LEE: Your reputation, though, has been a focus on customer-service to the point where you
call your bank locations stores as opposed to branches, and... and with that comes a reputation
that you dont compete on rates, necessarily. If you want to improve and... and grow your mortgage
part of the business, the loan part of the business, will you then be more competitive on the rates
side?
ED CLARK: Well, I think were competitive on the rates side, but, you know, the package that we
offer our consumer is more convenience so were open about 50 percent longer in hours and
then better service, and so we try to win the J.D. Power award every year, and we think thats a
great spot to be, that a lot of consumers want to just say, Can I have a good, solid relationship
with my bank, get great service and know theyll be there for us? And so I think, you know, were
competitive on rates, but thats not our prime differentiator, cause I dont think thats a
franchise. Thats just price-cutting.
MELISSA LEE: A lot of investors, a lot of analysts out there, anticipate you to be active when it
comes to acquisitions here in the United States. What sorts of properties would you be interested
in acquiring here?
Page 3 of 16
ED CLARK: Well, what weve said is for 2010, we really want to stick to either FDIC assisted deals
or small deals. Like, weve put in an offer to buy South Financial because we dont see that we
have certainty yet about where the US economic environment is going and we also dont have
certainty on the capital rules. And so were in that spot for 2010. When 2011 comes, well review
again whether we move from that stance or not, but for the moment, were... thats the stance were
in.
MELISSA LEE: Ed, pleasure speaking with you. (PAUSE) Ed Clark...
ED CLARK: Terrific being on the show. Thank you.
MELISSA LEE: President and CEO of TD Bank.
Dont go anywhere. We will trade TD on the other side of this break.
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Sun Bancorp Still Closing 2 Branches
By Jeff Blumenthal
July 12, 2010 Philadelphia Business Journal |
Sun Bancorp received a $100 million cash infusion from billionaire Wilbur Ross Jr. and other
investors last week, but it still plans to close two of its three branches in Salem County, N.J. In
a story first reported on NJ.com, Suns senior vice president for consumer banking, Douglas Smith,
said the closings were because of a confluence of circumstances, but he fingered the recession as
a main culprit.
In terms of banking industry and changes in regulatory environment, now, more than ever, banks are
assessing their locations, Smith said.
Both sites will close in September. Smith said the decision was made after periodic assessments of
the two Salem County locations, during which consumer actions and trends were analyzed. What they
found was sites with extremely low deposits $14.6 million in Woodstown and $31 million in the
city of Salem. The lone Salem County branch left only has $24.8 million and the bank has several
other sites in its footprint with lower numbers, according to Federal Deposit Insurance Corp. data.
Suns banking subsidiary, Sun National Bank, only has deposits per branch of $33.15 million in 67
New Jersey sites and $2.88 billion in total deposits.
In announcing the capital infusion last week, Sun CEO Thomas Geisel told me the bank is firmly
dedicated to creating a New Jersey powerhouse. We want to be meaningful in all the markets we
serve. The idea is that if we had to take one step back [due to the economy], we want to be in
position to take two steps forward.
It will need to improve its deposits per branch to reach that goal. As a basis of comparison, banks
such as Wells Fargo and TD Bank average well in excess of $100 million deposits per branch three
times Suns average.
Vineland, N.J.-based Sun has its largest presence in its home county of Cumberland ($615 million),
but is also big in Atlantic ($463 million), Monmouth ($369 million) and Ocean
Page 4 of 16
($228 million) counties. It has 12 branches combined in Camden, Burlington and Gloucester counties
for $478 million.
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TD Bank At Center Of Beach Parking Probe
By Patrick Anderson
July 12, 2010 Gloucester Daily Times (MA) |
The search for around $5,000 in missing city beach parking revenues has turned to TD Bank, which
has launched its own internal investigation into whether the money may have disappeared while in
its care. Gloucester police, who had first questioned beach employees about the missing money after
being alerted to discrepancies in parking receipts, said Monday they were awaiting the result of
the banks probe before taking the next step in their investigation.
We are still working with the bank, Gloucester Police Chief Michael Lane said Monday. The bank
is doing their own internal investigation, and that is where we are now focusing.
Few details about the missing money have been made public by either law enforcement officials or
the city. Police started investigating late last month after city Treasurer Jeffrey Towne flagged
troubling results within the internal controls for the beach accounts. The city has not released
the identity of the bank involved, but records and police reports over the past few weeks have
shown that TD Bank, which has two branches in Gloucester, anchored by its offices on Harbor Loop,
handles the city beach receipts.
TD Bank spokeswoman Rebecca Acevedo confirmed Monday that the bank was the subject of the
investigation. We take these matters very seriously and are conducting our own internal
investigation as well as cooperating fully with local authorities, Acevedo said. As to not
jeopardize that, we cant comment further.
The focus of the investigation shifted from city employees to the bank, Mayor Carolyn Kirk has
said, after irregularities turned up in at least one deposit to the bank over the busy Fourth of
July weekend. In fact, over this past weekend, TD Bank called Gloucester police concerned that
another bag of beach money had gone missing. As it turns out, the money was not missing; it had
already been counted and the bag returned to the beaches. Gloucester may be particularly sensitive
to suspicious activity at its beaches because of a history of larceny at the municipal parking
lots, which appear to present an irresistible target for thieves. In 1982, five city employees,
including three public school teachers, were arrested following a stakeout of the Wingaersheek
Beach parking lot on charges they were pocketing non-resident parking fees.
An audit by the city conducted after the arrests estimated that part-time parking lot attendants
had taken $156,149 from Wingaersheek and Good Harbor beaches between 1981 and 1982. Some have said
that figure is low. On a smaller sale, just last week, with the investigation underway, a pushcart
vendor selling slushies at Good Harbor Beach was robbed by a group of young people. No arrests have
been made in that case. During beach seasons, city employees deposit the money from the parking
lots daily in a bank deposit box, sometimes twice a day. The Fourth of July weekend brought heavy
crowds and large numbers of cars to both Wingaersheek and Good Harbor, where parking was restricted
to residents only for periods of time. Such days are known to pull in as much as $17,000 in
Page 5 of 16
parking fees. The city has reported no shortages or irregularities in the beach deposits since the
Fourth of July period.
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4. |
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TD Ratchets Up Overdraft Opt-In Push With Pop-Up Scare Tactics
By Ben Popken
July 12, 2010 Consumerist.com (blog) |
TD Bank is really stepping up its efforts to try to get customers to sign back up for overdraft
protection, which really just protects their right to charge you $35 if you want to buy a $2.00
candy bar and only have a $1 in your account. Now theyre greeting customers accessing their
accounts online with pop-up ads trying to scare them into agreeing to signing up for the service.
Reader Jay spotted this one last night and was bothered by the fact that they dont mention on the
landing screen that TD Bank will charge you for this dubious favor, but they do make sure to stoke
your anxieties a little bit: Simply say Yes To TD Debit Card Advance. And relax. Well continue
to cover your debit card and ATM transactions, just as we do today even when you may not have
enough funds available in your account.
Jay said that when you click the Are there Fees? FAQ, It initially says Its the same as you
already pay for overdraft!, like its no big deal, and then they finally mention the $35 fee. I
really feel horrible for the less informed bank customers who think TD (and other major banks) are
doing them a favor by pulling these stunts...
As of July 1st, banks cant automatically enroll you in overdraft protection plans, they have to
ask for your permission. Looks like theyre not content to just stuff your mailbox with junk mail
telling you what a great deal overdrafts are.
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Banking On Big Names No More
July 13, 2010 Gloucester County Times (NJ) |
Though it will not revert to just another high school auditorium, the once expansive offerings of
the TD Bank Arts Centre in Washington Township have been cut back.
The performing arts venue has always been a strange hybrid, owned by the Washington Township school
district, built by the townships taxpayers, and operated and booked by an arms-length outside
group, the non-profit Washington Township Live Arts (WTLA). And, of course, the center has long had
financial help from its naming rights deal with Commerce Bank, now absorbed into TD Bank.
The school board recently voted to dissolve WTLA, absorb $110,000 in unpaid debts from the
2,500-seat centers operation, and pick up the full salary of a director, after letting another
manager go. The result will be fewer big-name acts like Tony Bennett, Jessica Simpson and traveling
Broadway musicals, and more performances by acts that target
Page 6 of 16
specific, smaller audiences such as Gordon Lightfoot, and the trio of Fabian, Frankie Avalon and
Bobby Rydell, touring as the Golden Boys.
WTLA blames a revenue downturn on the general economic climate and a geographic squeeze play:
Philadelphia and Atlantic City sites are getting more strict in enforcing exclusivity clauses that
bar performers from appearing too close to their own venues.
The school district is also citing fallout from the clunky nature of the centers operation. The
state Department of Education has issued red flags, since the school district cant produce an
audit of the non-profit groups books. Putting the center in-house should resolve that issue.
Problems aside, it has been a nice run that has given the heart of Gloucester County direct access
to Evita, the Philadephia Orchestra, Barry Manilow, BB King and more. Before lamenting the loss
of such shows, however, its worth noting how close by the county is to other places where fans can
see them.
A retooled center still can be a community resource, booking conference business while reaching out
occasionally for acts too big for, say, Pitmans Broadway Theater, but not big enough for the
Kimmel Center, the Wachovia Center or the big casino rooms. Find the right mix, and the TD Centres
lights can continue to burn brightly.
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Earnhardt Grandson To Race TD Bank 250
Jeffrey Earnhardt will race in car provided by St. Hilaire
July 10, 2010 Morning Sentinel (ME) [Article also appears in Kennebec Journal (ME) and The
Sun Journal (ME).] |
OXFORD Jeffrey Earnhardt, grandson of auto racing legend Dale Earnhardt, has entered the TD Bank
250 on Sunday, July 18 at Oxford Plains Speedway.
Earnhardt will drive for Go Green Racing, a team owned by Archie St. Hilaire of Old Orchard Beach.
St. Hilaire has had cars in the field before, mostly recently when NASCARs Kevin LePage raced in
the 250 in 2008.
Earnhardt competes in the NASCAR Camping World Truck Series. He will compete in a truck race on
Friday then fly to Maine to practice Saturday in preparation for Sundays main event.
I was absolutely thrilled when Archie St. Hilaire contacted me to let me know that Jeffrey
Earnhardt would be competing in the TD Bank 250, OPS owner Bill Ryan said. The Earnhardts are
racing royalty and we are honored that Jeffrey has decided to challenge the best Late Models from
all over New England and Eastern Canada.
Earnhardt, a native of Mooresville, N.C., has competed in the NASCAR Nationwide Series and the K&N
East Series.
Racing in the TD Bank 250 will be an exciting challenge for me, Earnhardt said. Growing up in
racing like I did, everyone knows about Oxford and how tough the competition is there.
Page 7 of 16
TD BANK 250
When: Sunday, July 18
Where: Oxford Plains Speedway, Oxford
2009 champ: Eddie McDonald
Top
The following article is attached as a PDF:
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Marginal Borrowers Might Get 2nd Chance
By Stacy Wescoe
June 28, 2010 Eastern Pennsylvania Business Journal |
Banks say the have money to lend. On June 23 TD Bank had what it called a full-scale blitz in
Lehigh, Bucks, Montgomery, and Delaware counties targeting small business prospects.
Top
INDUSTRY NEWS
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1. |
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Finance Bill Close to Passage in Senate
Democrats Clinch Support of Republicans Brown and Snowe, Likely Reaching the 60 Votes Needed
for the Legislation
By Damian Paletta and Victoria McGrane
July 13, 2010 Wall Street Journal |
Two Senate Republicans said Monday they would support the Obama administrations financial-overhaul
legislation, and Democrats now believe they have the 60 votes needed to push the sweeping bill into
law by the end of the week.
Sens. Scott Brown of Massachusetts and Olympia Snowe of Maine both said they would vote for the
measure when Democrats bring it to a vote, which could happen as soon as this week. Democrats and
administration officials believe this gives them the necessary backing to overcome a potential
filibuster after weeks of uncertainty and unexpected pitfalls.
Because the House of Representatives passed the bill by a 237-to-192 margin several weeks ago,
Senate passage would send the bill to the White House, where President Obama is expected to quickly
sign it into law.
It is a better bill than it was when this whole process started, Mr. Brown said. While it isnt
perfect, I expect to support the bill when it comes up for a vote.
All three Republicans expected to vote for the bill secured changes to the bill addressing pet
issues or constituent concerns.
Page 8 of 16
Sens. Snowe and Brown withheld support during the July 4 recess, saying they needed more time
to study the bill. They will join Sen. Susan Collins (R., Maine) as three Republicans who have now
committed to vote for the bill. Their votes offset the loss of Democratic Sen. Russell Feingold of
Wisconsin, who said he would vote against the bill, and Sen. Robert Byrd, who died last month and
has not yet been succeeded.
Senate Majority Leader Harry Reid (D., Nev.) said the Senate would now finish our work on this
bill this week to ensure that these critical protections and accountability for Wall Street are in
place as soon as possible.
Still, even with the support of the three Northeastern Republicans, the vote remains on a knifes
edge, with just 60 expected in support. Sowing a fresh element of doubt, Sen. Ben Nelson (D., Neb.)
said Monday he had not decided whether to vote for the bill because of concerns over whom the White
House would name as head of a new consumer-lending regulator.
The math appears, nonetheless, to have finally lined up for the White House, which has pushed to
overhaul financial regulations for more than a year, despite fierce resistance from business groups
and many Republicans. White House and Treasury Department officials declined to comment on the
developments.
Many Republicans have panned the bill, saying it would drive up the costs of credit and harm the
U.S.s competitiveness. They have also complained that the bill does little to address Fannie Mae
and Freddie Mac, the mortgage finance giants that have remained under government control since
2008.
But almost all Democrats and now a handful of Republicans have said the bill makes structural
changes to the oversight of regulation that would fix problems exposed during the financial crisis.
Democrats made the bill a major domestic priority, and some hope the new layers of regulation on
finance will appeal to voters during the November midterm election.
The bill would tighten regulations governing almost every corner of financial markets, in a bid to
prevent another financial crisis and better handle one if it arrives.
The bill would boost powers of agencies such as the Federal Reserve and Securities and Exchange
Commission, create a new regulator to monitor consumer lending rules, give the government the power
to break up failing companies and toughen scrutiny over exotic financial products like derivatives.
If the bill becomes law, the banking industry is expected to shift their lobbying focus from
Capitol Hill to the bank regulators, which will have the job of writing hundreds of new policies to
implement the new rules.
The regulators discretion will likely be a flashpoint in coming days, as signaled by the concerns
raised by Mr. Nelson on Monday about the consumer agency, which is designed to operate
independently of other regulators.
Cognizant that Democrats needed Republican support, the White House agreed to multiple changes in
recent months.
To win Mr. Browns support, Democrats limited the bills impact on asset-management and mutual-fund
companies. They also scrahpped a levy on large banks and hedge funds.
Page 9 of 16
To win backing from Ms. Snowe, Democrats agreed to an amendment resisted by liberal groups that
could exempt many small businesses from the reach of the new consumer regulator.
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Small-Business Lending Is Down, but Reasons Still Elude the Experts
By Sewell Chan
July 12, 2010 New York Times |
WASHINGTON The chairman of the Federal Reserve urged banks and regulators on Monday to help the
nations small businesses get the loans they needed to create jobs.
He also acknowledged that economists could not agree on why such lending has contracted
substantially over the last two years.
Small businesses those having fewer than 500 employees employ half of all Americans and account
for about 60 percent of gross job creation. Federal data indicate that lending to such companies
fell to below $670 billion in the first quarter of this year from more than $710 billion in the
second quarter of 2008.
The reasons are unclear. Many entrepreneurs say that bank loan officers are denying loans to
creditworthy borrowers as part of an overreaction to the bad loans of the last economic expansion
and heightened scrutiny by regulators.
But several economists paint a more nuanced picture, arguing that weak economic fundamentals and
battered balance sheets have lowered the appetite for new lending. They say that demand could take
years to recover.
The Fed chairman, Ben S. Bernanke, acknowledged the uncertainty at the start of a daylong forum on
small-business lending at the central banks headquarters.
How much of this reduction has been driven by weaker demand for loans from small businesses, how
much by a deterioration in the financial condition of small businesses during the economic
downturn, and how much by restricted credit availability? Mr. Bernanke asked. No doubt all three
factors have played a role.
In a broad outreach effort, the Fed held 43 meetings on the financing needs of small businesses,
starting on Feb. 3 in Lexington, Ky., and ending on June 30 in Shreveport, La. Two of the meetings,
in Miami and Davenport, Iowa, focused on Hispanic-owned businesses. One, in Denver, was centered on
the Small Business Administrations guaranteed-loan programs. At yet another, in Detroit, the
challenges facing auto industry suppliers took center stage.
A collapse in the value of real estate and other collateral used to secure loans posed a
particularly severe challenge to small businesses, Mr. Bernanke said. He recalled that a business
owner at the Detroit meeting told him, If you thought housing had declined in value, take a look
at what equipment is worth.
Some entrepreneurs have resorted to borrowing on their personal credit cards or from their
retirement accounts, he noted.
Page 10 of 16
Banks, for their part, say that they have not so much tightened credit as returned to more
traditional underwriting standards after being too lax, Mr. Bernanke acknowledged.
But, though some lenders said they were emphasizing cash flow and relying less on collateral
values in evaluating creditworthiness, Mr. Bernanke said, it seems clear that some creditworthy
businesses including some whose collateral has lost value but whose cash flows remain strong
have had difficulty obtaining the credit that they need to expand, and in some cases, even to
continue operating.
Mr. Bernankes cautious diagnosis set the tone for the forum, which included four panel
discussions. His view was echoed by two other speakers, Karen G. Mills, the head of the Small
Business Administration, and Elizabeth A. Duke, a member of the Feds board of governors.
But the ambivalent nature of the discussion after months of listening and research by the Fed
prompted expressions of frustration from several of those invited to the event.
With all due respect for my banking colleagues, there is an apparent disconnect between the
proclaimed business as usual and the widespread problems with access to credit reported by small
businesses, said Shari Berenbach, president of the Calvert Foundation, a nonprofit organization in
Bethesda, Md., that makes loans to community development financial institutions that serve poor and
working-class areas. Bank representatives maintained that meritorious borrowers were getting loans,
and economists agreed that there was not much evidence of a broad refusal to lend.
Kevin P. Watters, chief executive of business banking at JPMorgan Chase, said the bank was taking a
second look at borrowers that initially were denied loans, and was eager to make loans. Were
really trying to get those healthy borrowers to invest again, he said.
William C. Dunkelberg, an economist in the School of Business and Management at Temple University,
said surveys showed that capital spending was at a 35-year low and that companies were still
cutting, not adding, inventory. Credits not an issue, he said. Customers are the issue.
Even so, Mr. Bernankes remarks suggested that the Fed was not sure why lending had contracted. He
highlighted the particular importance of start-up businesses. Companies less than two years old
accounted for roughly a quarter of gross job creation over the last 20 years, even though they
employed less than 10 percent of the work force during that time, he said, citing new research.
Zoltan J. Acs, an economist in the School of Public Policy at George Mason University, said that in
Japan stagnation had stifled entrepreneurship, and that the United States might be following a
similar path.
What I worry about is, are we on a trajectory where start-ups are not going to recover?
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B of A Merrill Retirement Services Buildup Showing Results
By Matt Ackermann |
Page 11 of 16
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July 13, 2010 American Banker |
Bank of America Merrill Lynchs expansion of its retirement services business is picking up
momentum.
Enlarging the operation has been a key initiative for the Charlotte company for the past year, and
its recommitment to the business is really beginning to see results in terms of sales traction
in the marketplace, Andy Sieg, head of B of A Merrill Lynch retirement and philanthropic services,
said in an interview last week.
In the first six month of this year, the unit generated more than $13 billion in new retirement
business, which is more than it accumulated for all of 2009. At March 31, the unit was responsible
for about $500 billion in client assets.
The pace of sales is running well ahead of our forecast and objectives, Sieg said. The momentum
is strong and these additions will redouble momentum.
B of A Merrill Lynch said in an internal memo Thursday that it hired two veterans from Fidelity
Investments, Rich Linton as head of business retirement solutions, and Steve Ulian as head of
institutional retirement and benefits solutions.
Linton, 42, will be responsible for managing B of A Merrill Lynchs small-business retirement
solutions including its Advisor Alliance platform, which was formerly MLConnect, and the SEP/Simple
offering, which is an individual retirement account offering for small businesses.
He was an executive vice president of the adviser retirement group at Fidelity, where he held a
variety of senior executive positions since he started at the Boston company in 1990.
Ulian, 46, will run B of A Merrill Lynchs proprietary 401(k) platform, defined benefit plan
administration, requests for proposals, pricing and underwriting as well as equity plan services.
He was an executive vice president in sales and relationship management for Fidelitys workplace
investing group. He has worked at Fidelity since 2005. Before that, he was a national sales manager
and an operations team leader at Deutsche Bank/Scudder Investments, where he led its retirement
services business.
Both Linton and Ulian will take on responsibilities that were handled by John Furlong, who left in
January to pursue other opportunities. They will report to Sieg, who said the pair will help B of A
Merrill Lynch penetrate both ends of the retirement market.
He said Ulian will focus on delivering integrated benefits solutions to mid- and large-market
companies and Linton will focus on smaller businesses.
Sieg said Linton will work with executives throughout the parent bank to cross-sell retirement
solutions to its 4 million small-business customers.
In June, B of A Merrill Lynch relaunched Advisor Alliance, a retirement services platform for
companies with fewer than 100 employees, to attract more business from small businesses. The
platform allows Merrill Lynch advisers to sell record keeping and retirement plan administration
services to small-business owners.
Page 12 of 16
Sieg said he thinks there are opportunities to work more closely with small-business owners. Bank
of America Global Commercial Bank has relationships with one out of every three midsize businesses
nationally. This year the companys global commercial bank had referred more than 2,100 clients to
the B of A Merrill Lynch institutional retirement business, as of June 30.
Sieg said B of A has only scratched the surface of the referral opportunities that exist between
these two businesses.
Adding retirement assets has been a major initiative at B of A since it hired Sallie Krawcheck in
August as the $2.39 trillion-asset companys head of wealth management and brokerage operations. In
October, B of A rolled out My Retirement Income, a group of products that let customers nearing or
in retirement automatically transfer funds from a Merrill Lynch cash management account into a B of
A deposit account monthly or quarterly.
Sieg said his unit will continue to look to hire to support its growth.
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FDIC Board Beefs Up Exam Powers
By Stacy Kaper
July 13, 2010 American Banker |
The Federal Deposit Insurance Corp. board took steps Monday to respond to criticism that the FDIC
was hindered from using its backup examination powers aggressively enough during the financial
crisis to protect the deposit insurance fund.
The FDICs board unanimously approved a memorandum of understanding that would enhance the ability
of the agency to gather information from primary regulators and conduct special examinations of
large and risky insured depository institutions.
The agreement was designed to address concerns raised by the inspectors general of the FDIC and the
Treasury Department in a joint report in April on the failure of Washington Mutual Inc.
The report chiefly faulted the thrifts primary regulator, the Office of Thrift Supervision, yet
criticized the FDIC for not using its backup examination authority more effectively to prevent the
thrifts demise. Comptroller of the Currency John Dugan said it was important not to undercut the
primary regulators function.
I am very leery of creating a de facto system of supervision by committee, he said.
FDIC Chairman Sheila Bair said the agreement in theory would provide the FDIC with the tools it
needs to do its job.
I want to note that while significant effort has gone into developing this revised agreement, the
real work lies ahead in implementing its terms, she said.
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Page 13 of 16
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Citigroup Bondholder Suit Can Go Forward, Judge Rules
By Bob Van Voris and Patricia Hurtado
July 12, 2010 Bloomberg News |
(Bloomberg) A lawsuit claiming that Citigroup Inc. misled investors who bought 48 issues of
its corporate bonds offered from May 2006 to August 2008 can go forward, a federal judge in New
York ruled.
U.S. District Judge Sidney Stein today denied part of a motion by Citigroup to dismiss the suit,
which claims Citigroup misrepresented its liabilities from toxic mortgage-backed securities.
Stein threw out claims that involved alleged lack of disclosure about auction rate securities and
part of the plaintiffs case related to structured investment vehicles.
The banks disclosures of its financial performance and condition contained untrue statements of
material facts and omitted material facts, the plaintiffs said in a complaint originally filed in
New York state court in 2008. These statements failed to disclose the true extent of the Companys
massive exposure to risky mortgage-related assets including mortgage backed securities and
collateralized debt obligations.
Once these liabilities became public, the companys bonds plummeted in value, the complaint claims.
The underwriters failed to ensure the truthfulness and accuracy of the various statements in
Citigroups offerings, the plaintiffs claimed. According to Stein, the plaintiffs dismissed 61 of
the underwriters from the suit in February 2009.
Citigroup and the other defendants argued the investors lacked legal standing to press the claims.
The suit names as defendants Citigroup, its wholly owned Citigroup Funding Inc. subsidiary, eight
Citigroup trusts, 28 current and former Citigroup officers and directors and almost 80 banks that
underwrote the bonds, according to Steins opinion.
We are pleased that some claims were dismissed, and will vigorously defend the remaining claims on
the merits, Danielle Romero, a spokeswoman for Citigroup, said in an e-mail.
Stein said the plaintiffs have standing to raise claims that Citigroup violated sections 11 and 15
of the federal Securities Act. Section 11 permits investors to sue for misstatements in a
registration statement. Section 15 makes controlling persons liable for violations, Stein said.
The ruling says the investors can continue to pursue claims that Citigroups registration
statements failed to disclose possible liability for $66 billion in collateralized debt obligations
backed by subprime mortgages and for $100 billion in subprime mortgage-backed structured investment
vehicles after December 2007.
The defendants can also pursue their Section 11 and 15 claims that Citigroup understated the amount
necessary to cover residential loan losses, falsely claimed it was well capitalized and falsely
claimed that its financial statements complied with Generally Accepted Accounting Principles, GAAP.
Stein dismissed claims that Citigroup failed to disclose $11 billion in auction rate securities it
held and its liability for the structured investment vehicles before December 2007.
Page 14 of 16
Stein held that the plaintiffs lack standing to bring any claims under Section 12 of the act, which
covers misstatements in public offering materials, because the investors didnt claim they bought
the bonds directly from Citigroup, rather than on the secondary market.
The plaintiffs in the case include the Louisiana Sheriffs Pension and Relief Fund, Minneapolis
Firefighters Relief Association and the City of Philadelphia Board of Pensions and Retirement.
They seek to represent all holders of the Citigroup bonds.
The case is: In Re Citigroup Bond Litigation, No. 08-CV- 9522, U.S. District Court, Southern
District of New York (Manhattan).
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The Daily News Brief is published exclusively for the Employees of TD Bank; please do not
distribute outside the company.
The information presented may contain forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995 and comparable safe harbour provisions of
applicable Canadian legislation, including, but not limited to, statements relating to anticipated
financial and operating results, the companies plans, objectives, expectations and intentions,
cost savings and other statements, including words such as anticipate, believe, plan,
estimate, expect, intend, will, should, may, and other similar expressions. Such
statements are based upon the current beliefs and expectations of our management and involve a
number of significant risks and uncertainties. Actual results may differ materially from the
results anticipated in these forward-looking statements. The following factors, among others,
could cause or contribute to such material differences: the ability to obtain the approval of the
transaction by The South Financial Group, Inc. shareholders; the ability to realize the expected
synergies resulting from the transaction in the amounts or in the timeframe anticipated; the
ability to integrate The South Financial Group, Inc.s businesses into those of The
Toronto-Dominion Bank in a timely and cost-efficient manner; and the ability to obtain governmental
approvals of the transaction or to satisfy other conditions to the transaction on the proposed
terms and timeframe. Additional factors that could cause The Toronto-Dominion Banks and The South
Financial Group, Inc.s results to differ materially from those described in the forward-looking
statements can be found in the 2009 Annual Report on Form 40-F for The Toronto-Dominion Bank and
the 2009 Annual Report on Form 10-K of The South Financial Group, Inc. filed with the Securities
and Exchange Commission and available at the Securities and Exchange Commissions Internet site
(http://www.sec.gov).
The proposed merger transaction involving The Toronto-Dominion Bank and The South Financial Group,
Inc. will be submitted to The South Financial Group, Inc.s shareholders for their consideration.
The Toronto-Dominion Bank and The South Financial Group, Inc. have filed with the SEC a
Registration Statement on Form F-4 containing a preliminary proxy statement/prospectus and each of
the companies plans to file with the SEC other documents regarding the proposed transaction.
Shareholders are encouraged to read the preliminary proxy statement/prospectus regarding the
proposed transaction and the definitive proxy statement/prospectus when it becomes available, as
well as other documents filed with the SEC because they contain important information.
Shareholders may obtain a free copy of the preliminary proxy statement/prospectus, and will be able
to obtain a free copy of the definitive proxy statement/prospectus when it becomes available, as
well as other filings containing information about The Toronto-Dominion Bank and The South
Financial Group, Inc., without charge, at the SECs Internet site (http://www.sec.gov). Copies of
the definitive proxy statement/prospectus and the filings with the SEC that will be incorporated by
reference in the definitive proxy statement/prospectus can also be obtained, when available,
without charge, by directing a request to The Toronto-Dominion Bank, 15th Floor, 66
Wellington Street West, Toronto, ON M5K 1A2, Attention: Investor Relations, 1-866-486-4826, or to
The South Financial Group, Inc., Investor Relations, 104 South Main Street, Poinsett Plaza,
6th Floor, Greenville, South Carolina 29601, 1-888-592-3001.
The Toronto-Dominion Bank, The South Financial Group, Inc., their respective directors and
executive officers and other persons may be deemed to be participants in the solicitation of
proxies in respect of the proposed transaction. Information regarding The Toronto-Dominion Banks
directors and executive officers is available in its Annual Report on Form 40-F for the year ended
October 31, 2009, which was filed with the Securities and Exchange Commission on December 03, 2009,
its notice of annual meeting and proxy circular for its 2010 annual meeting, which was filed with
the Securities and Exchange Commission on February 25, 2010, and the above-referenced Registration
Statement on Form F-4, which was filed with the SEC on June 10, 2010. Information regarding The
South Financial Group, Inc.s directors and executive officers is available in The South Financial
Page 15 of 16
Group, Inc.s proxy statement for its 2010 annual meeting, which was filed with the Securities and
Exchange Commission on April 07, 2010. Other information regarding the participants in the proxy
solicitation and a description of their direct and indirect interests, by security holdings or
otherwise, is contained in the above-referenced Registration Statement on Form F-4, which was filed
with the SEC on June 10, 2010, and other relevant materials to be filed with the SEC when they
become available.
Page 16 of 16
THE FOLLOWING IS THE TRANSCRIPT OF A VIDEO CLIP MADE AVAILABLE TO EMPLOYEES OF THE TORONTO-DOMINION BANK ON JULY 13, 2010
CNBC, Fast Money Interview with Ed Clark 7/12/2010
MELISSA LEE (CNBC-TV): Despite uncertainty over financial regulation, TD, Canadas second-largest
bank, continues expanding presence (?) in the United States, now projecting their US bank profit to
double over the next three years. Joining us live from Toronto is Ed Clark, president and CEO of TD
Bank Financial. Ed, nice to see you.
ED CLARK (President and CEO, TD Bank Financial): Nice to see you, Melissa. I always watch your
program, and now its fun to be on it.
MELISSA LEE: Oh, great. Were happy to have you. I want to take your lead from your most recent
investor meeting and focus in on the US operations, because it was a very bold goal that you
outlined in terms of one-point-six billion in annual earnings for the next three years. Theres a
few ways you can achieve that, and one is improving loan losses. Im curious, what... what is the
trend that youre seeing right now here in the US?
ED CLARK: Yeah, so weve definitely seen a turn in the US. Our non-performers and... if (?) you
reported last quarter, were flat, and we... you know, as we look forward, we see that declining and
our loan-loss provisions declining at a pretty steady pace. So I would say that were actually
quite positive on... on the US environment. The other thing that drives those earnings-growth,
though, is that weve been aggressively growing, so were the only bank of the top 10 in 2009 to
increase its lending, and were increasing our lending again in 2010, so I think well be
distinguished in the market again this year.
MELISSA LEE: What kind of loans are you focusing in on? You know, I was reading some analysts
reports, and what struck me is that you have mortgage and refinancing nowadays, and two years ago
you didnt have that at all.
ED CLARK: Right, so obviously theres been a big disruption in the mortgage market, and so for us,
thats a great place for us to go. Were obviously very big in that in Canada, but we see ourselves
now cross-selling that product to our consumers in the United States, and so we... we think thats a
huge opportunity
right now in the marketplace.
MELISSA LEE: Your reputation, though, has been a focus on customer-service to the point where you
call your bank locations stores as opposed to branches, and... and with that comes a reputation that
you dont compete on rates, necessarily. If you want to improve and... and grow your mortgage part of
the business, the loan part of the business, will you then be more competitive on the rates side?
ED CLARK: Well, I think were competitive on the rates side, but, you know, the package that we
offer our consumer is more convenience so were open about 50 percent longer in hours and then
better service, and so we try to win the J.D. Power award every year, and we think thats a great
spot to be, that a lot of consumers want to just say, Can I have a good, solid relationship with
my bank, get great service and know theyll be there for us? And so I think, you know, were
competitive on rates, but thats not our prime differentiator, cause I dont think thats a
franchise. Thats just price-cutting.
MELISSA LEE: A lot of investors, a lot of analysts out there, anticipate you to be active when it
comes to acquisitions here in the United States. What sorts of properties would you be interested
in acquiring here?
ED CLARK: Well, what weve said is for 2010, we really want to stick to either FDIC assisted deals
or small deals. Like, weve put in an offer to buy South Financial because we dont see that we
have certainty yet about where the US economic environment is going and we also dont have
certainty on the capital rules. And so were in that spot for 2010. When 2011 comes, well review
again whether we move from that stance or not, but for the moment, were... thats the stance were
in.
MELISSA LEE: Ed, pleasure speaking with you. (PAUSE) Ed Clark...
ED CLARK: Terrific being on the show. Thank you.
MELISSA LEE: President and CEO of TD Bank.
Dont go anywhere. We will trade TD on the other side of this break.