TD Bank reports second-quarter income miss and issues medium-term profit warning

Investing.com -- TD Bank (NYSE:TD) (TSX:TD) reported a decline in second-quarter income that missed expectations and warned that it does not expect to meet its previously outlined earnings target, as Canada's second-largest lender was hit by broader economic pressures and a terminated tie-up with First Horizon (NYSE:FHN).

The firm posted adjusted diluted earnings per share of $1.94 in the three months ended on April 30, slipping from $2.02 in the corresponding period last year. Bloomberg consensus estimates had placed the figure at $2.08.

TD Bank flagged that it does not believe it will hit its medium-term objective for adjusted income growth of between 7% to 10%, blaming the "deterioration in the macroeconomic environment."

It also cited an impact from its mutual decision with Tennessee-based regional bank First Horizon to scrap a planned $13.4 billion merger. Under the terms of the agreement, TD pledged to make a $200 million cash payment to First Horizon. In addition, Canada's second-largest bank said it would pay $25M that it contractually owed to First Horizon if the deal failed to get the green light from regulators.