Toronto-Dominion Bank says it expects to take a provision for credit losses related to its U.S. retail banking business of roughly $1.1 billion (US$800 million) in its second quarter due to the pandemic.
The charge related to funds set aside to cover potentially bad loans comes as the steps taken to slow the spread of COVID-19 has devastated the economy and thrown millions of people out of work.
The bank says it is also expected that the corporate segment will record about $600 million (US$400 million) in provisions for credit losses for the quarter ended April 30.
However, it says the losses in the corporate segment consists primarily of the retailer partners' share of provisions for credit losses for the bank's U.S. strategic card portfolio.
TD says the retailer partners' share of revenues and provisions for credit losses recorded in the corporate segment are fully offset through corporate non-interest expenses and will result in no impact to the bank earnings in the second quarter.
TD Bank is expected to report its full second-quarter results on May 28.
This report by The Canadian Press was first published May 8, 2020.
Companies in this story: (TSX:TD)