Td Basel Iii Implementation

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  • Topic: Capital requirement, Tier 1 capital, Toronto-Dominion Bank
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Individual Assignment - TD Canada Trust
FIN 701
Financial Intermediation
Professor: Patricia McGraw
Mailbox 34 in TRS 1-002

By: Edward LeBar
Student #: 500-430-786
Due Date: November 19th, 2012
Table of Contents

Introduction:3
Basel III:5
Conclusions:10
Appendix12
Appendix 1 – How we manage risk12
Appendix 2 – TD Capital Position13
Tier 1 Capital13
Tier 2 Capital14
Capital Ratios14
Appendix 3 – BCAR Capital Components15
Tier 115
Tier 216
Tier 317
Capital Ratios17
Appendix 4 - Consolidated Balance Sheet18
Appendix 5 - BCAR Derivative Component21
Appendix 6 – Risk Weighted Assets Basel II23
Appendix 7 – Price Waterhouse Coopers24
Perspectives on the Canadian banking industry24
Capital Adequacy Ratio Chart25
References26

Individual Assignment – TD Canada Trust
Introduction:
TD Canada Trust had many predecessors before becoming the powerhouse bank it is today. TD started off as the Bank of Toronto was founded in 1855 in Toronto, Canada, by a group of Ontario flour millers and grain dealers. Canada’s Grain industry was emerging at that time, which created a need for a new bank to provide essential banking, insurance, and commodity exchange services. The Bank of Toronto’s business began to grow the bank began a provincial branch network and would expand to Montreal in 1860. In 1867 the Dominion bank was founded by a group of professionals, industrialists and financiers raised funds to create a new financial institution. In 1869, the Canadian Parliament issued a charter to the Dominion bank in order to help build Canada’s infrastructure. The Dominion bank and Toronto Bank were in competition with each other in the early and both aggressively expanded branches. The Two banks would expand all over Canada, and in 1911 the Dominion bank made its first foreign venture to London, England and New York in 1919. Shortly after challenges would arise with events such as World War I, then the Great Depression, and finally World War II. During this period both banks aggressively expanded, therefore on February 1, 1955, the two banks merged into one becoming the Toronto Dominion Bank with 499 branches and a combined team of 5,500 employees. The new bank philosophy emphasized customer service and product knowledge. "The Best in Banking Service", which was the combined bank's first slogan, evolved into "The Bank Where People Make the Difference." TD had a need to satisfy its diverse customer base, therefore they launched products and services which included mutual funds in 1964 and the VISA card (Chargex) in 1968. In the 1980’s, TD entered into many new businesses such as international money market trading, commercial real estate developments, discount brokerage business (Green Line Investor Services), and full-service brokerage. In 1987, Toronto Dominion Securities Inc. was established to provide corporate, treasury and investment banking services to corporate clients. In the 1990’s through to the early 2000’s TD made some milestone acquisitions with the purchase of Central Guaranty Trust in 1992, the purchase of New York-based Waterhouse Investor Services in 1996, and in 2000 TD purchased Canada Trust. All of these acquisitions were a beneficial impact of shaping TD Canada Trust in becoming the powerhouse bank it is today. In the recent years, TD Canada Trust has been known for their exceptional customer service and providing convenience to their customers through Easy Line and Easy Web services. TD has expanded their operations in the US with TD Ameritrade, TD Waterhouse, and TD Bank North. Recently in the banking industry, there was the Subprime Mortgage Crisis of 2008, this event caused severe damage to the world’s economy. This occurred due to the US’s poor regulations of the financial sector and lack of monitoring the bank’s financial activities. To address the lack of regulation on the banks financial activities, BASEL III was introduced to try to prevent...
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