Thursday, March 1, 2012

TD Dividend Increase

TORONTO, March 1, 2012 /PRNewswire/ - The Toronto-Dominion Bank (the Bank) today announced that a dividend in an amount of seventy-two cents (72 cents) per fully paid common share in the capital stock of the Bank has been declared for the quarter ending April 30, 2012, payable on and after April 30, 2012, to shareholders of record at the close of business on April 4, 2012. This represents an increase in the quarterly dividend of 4 cents or 5.9 per cent compared with last quarter. 

Despite a lower quarter profit then in 2011, TD managed to pop out a dividend increase. An almost 6% dividend increase still beats inflationary increases which average from 2-4% so it still looks good to me. Even with the new dividend increase, TD's dividend payout ratio is only 45% which looks very strong for future dividend increases. Let's take a look at TD's dividend history since 2000:


  1. I am a Brit who mostly invests my personal money in dividend stocks in the US, Canada and UK. I have actually owned TD for a bit over three years, and am overall quite happy with it. I think its the perfect stock for the current environment. Good dividend, in a business that is easy enough to understand. I am not in finance or banking myself, but have read enough to gather that there is a clear and fundamental difference between the banks in the US and UK versus those in Canada. As I gather, Canadian banks are better run and subject to better regulatory scrutiny than their cousins south of the border. From what I understand, Canadian loans in the Canadian housing industry are recourse, i.e. banks can come after peoples' personal assets for loan non-payment, which as I gather obviously makes people more conservative in their borrowing approach (at least I think this is true). Finally, I also think the Canadian economy is MUCH less finance-centric than that of the UK or US, and banks are more likely to "stick to their knitting" so to speak. I'd be happy to be corrected on any of my perceptions though:)

    1. Hey there IIF,

      I'm pretty sure the the mortgages in the U.S are recourse as well. Canadian banks are not saints when it comes to loaning money. They lend out money from private lenders and skim interest off the top. They make major money when people break their mortgage terms. I had 14 months left on our mortgage when we sold our house and they charged us almost $6000 in fees even though we were getting a new mortgage with the same bank.

      Our banks here in Canada are on a tight leash compared to other countries. For example, in late January, The major Canadian banks were offering a mortgage rate of less then 3% over 25 years and were supposed to offer it until the end of February. The federal government was not impressed and the special offer was revoked a few weeks before the original end date.

      Thanks for your comment!