TD Bank Financial Group 147th Annual Report 2002 Close Window Button
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Management's discussion and analysis of operating performance

TD Wealth Management

Review of financial performance for the year

TD Wealth Management reported moderately lower earnings in 2002 compared with 2001. Cash basis net income of $131 million was $17 million or 11% lower than last year. Cash basis return on economic capital increased from 18% to 22%, while the cash basis efficiency ratio remained virtually unchanged.

Fee-based revenue declined $57 million or 3%, primarily due to the significant market declines which reduced trading volumes in our discount brokerage business and impacted asset-based fees. In addition, narrower spreads and lower margin loan balances reduced net interest income by 9% to $435 million.

Cash basis expenses decreased $70 million or 3% in 2002 compared with last year in spite of continued investment in our Financial Planning business, rebranding TD Waterhouse Canada to include Investment Advice and Financial Planning and continued growth internationally of the discount brokerage business.

Total assets under management (AUM) decreased by 6%, as negative markets and reduced institutional mandates resulted in ending AUM of $112 billion. Additionally, assets under administration (AUA) ended the year at $234 billion down by 2% from last year.

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