TD cut jobs and a $3B portfolio to shrink under its US money-laundering asset cap
Hit with $3B+ in US penalties and a $434B asset cap, TD is cutting 2% of staff, winding down a $3B POS financing book and selling assets to fit the cap.
What was changed
TD, Canada's second-largest bank, entered 2025 reeling from US money-laundering failures that cost it more than $3 billion in penalties and imposed a $434 billion asset cap on its US retail operations. New CEO Raymond Chun, at the helm since February, was about two-thirds through a comprehensive strategic review launched the previous year to bring the bank back inside the cap.
In May 2025 the bank announced the next tranche: a restructuring begun in its fiscal second quarter that cuts about 2% of its roughly 100,000-person workforce, with C$600-700 million ($432-505 million) in restructuring charges over several quarters, expected to generate C$100 million ($72 million) in savings for fiscal 2025. CFO Kelvin Tran said cuts would come through attrition where possible, plus real-estate optimization, asset write-offs and business exits.
The same logic reached the balance sheet. TD is winding down its $3 billion US point-of-sale financing portfolio serving third-party retailers — a business US CEO Leo Salom said 'does not scale quite as well' because of bespoke arrangements with each retailer — and has already sold its entire Charles Schwab stake and a $9 billion residential mortgage portfolio, shrinking US retail assets by about 10%. Chun said the restructuring frees funds to accelerate digital and AI investments and scale relationship banking.
Why it worked
The asset cap makes total US assets the binding constraint, so low-return assets have to go regardless of their standalone health.
Bespoke point-of-sale deals consume investment that proprietary and co-brand cards return at higher rates.
Cutting through attrition first protects the AML remediation work, which needs experienced staff to finish.
What can be applied
An asset cap turns size itself into the enemy: sell what doesn't scale, cut what doesn't differentiate, and reinvest the savings in what regulators still demand you fix.
Aftermath
By March 2025 Chun had said the bank was about two-thirds through the strategic review; asked in May whether more businesses would be wound down, he said executives were 'looking at all of our options'.