(August 8 – 17:00 ET) – The Financial Times calls TD Bank Canada’s leading Internet bank, as all Canadian banks rush to exploit the potential of online banking.
FT says that thanks largely to its discount brokerage arm, TD Waterhouse, TD has the third-largest online presence of any financial institution in the world, behind Charles Schwab and Wells Fargo. It now has 2.5 million online customers, and it added 500,000 new customers in the last quarter. According to Goldman Sachs, TD is second only to Wells Fargo in the online banking business, excluding stock trading.
“TD Bank, which until last year was the smallest of the five leading Canadian banks, has clearly established itself at the head of the pack,” the story says.
TD CEO Charlie Baillie admits that the bank’s online presence is partly luck, coming thanks to its experience with Waterhouse, which it built into a leading online broker. That, “gave us a comfort level in the online world, which made it easier for us to apply it to banking”, says Baillie. “We saw it as a natural extension of banking because you could do all the banking features and we’d pay you more money for it because the intermediary costs are lower than they are for a bank”.
Baillie says that its acquisition of CT Financial Services was partly driven by the difficulty it had recruiting Waterhouse clients into online banking. The CT deal was not about acquiring more branches, he says, “What we really wanted were the customers. It’s a lot easier to convert existing customers to new products than it is to acquire customers.” He suggests that TD’s lead in retail banking in Canada should give it a good base to begin launching U.S. acquisitions once the CT deal has been digested.
-IE Staff