TD Bank Financial Group and Banknorth Group Inc. confirmed Wednesday they are in talks about a possible deal that would see the Canadian bank acquire a major stake in the New England-based bank.

“At this point there can be no assurances that the discussions will lead to an agreement,” the companies said in a joint news release. “The companies do not intend to comment further on this subject unless an agreement is reached or the discussions have been terminated.”

TD Bank shares were down $1.36 or 2.96% to $44.64 on the S&P/TSX in morning trading.

The Financial Times had reported late Tuesday that Toronto-based TD was in advanced talks to take control of Banknorth in a cash-and-stock deal that would be worth more than US$2.2 billion. The London-based financial newspaper said a deal would involve TD, one of Canada’s largest banks, buying about 50% of Portland, Me.-based Banknorth, which has a market capitalization of US$5.45 billion.

Banknorth has more than 300 branches in Vermont, Massachusetts and New Hampshire.