TD Bank (TD) Q2 2026 earnings summary

Executive summary

• Q2 2026 delivered adjusted EPS of $2.38, up 21% year-over-year, and adjusted net income of $4.2 billion, with robust performance and record earnings across all major segments.

• ROE was 14.4%, up over 200 basis points year-over-year, and positive operating leverage was achieved for the fourth consecutive quarter.

• Announced a dividend increase to CAD 1.12 per share and repurchased approximately 19 million shares in Q2.

• Continued progress on strategic priorities, including AI adoption, cost reduction, and AML remediation, with significant milestones expected through 2027.

• Strong digital leadership, margin expansion, and disciplined cost management supported performance.

Financial highlights

• Adjusted EPS up 21% year-over-year; adjusted net income for Q2 2026 was $4,168 million; ROE at 14.4%.

• CET1 capital ratio at 14.3%, with strong organic capital accretion and ongoing share buybacks.

• Adjusted efficiency ratio (net of ISE) at 57.0%; dividend payout ratio (adjusted) at 45.0%.

• Provision for credit losses (PCL) stable at $1,001 million, with a PCL ratio of 43 basis points.

• Dividend per share increased to CAD 1.12.

Outlook and guidance

• On track to outperform 6%-8% EPS growth and 13% ROE targets for fiscal 2026, assuming stable macroeconomic conditions.

• Fiscal 2026 PCLs expected to be 40-50 basis points; adjusted expense growth targeted at 3%-4%.

• CET1 ratio expected to reach approximately 13% by October 31, 2027.

• U.S. Banking segment net income guidance remains at approximately $2.9 billion for 2026.

• Net interest margin in Canadian P&C expected to remain stable, with a modest increase in U.S. Banking for Q3 2026.