TD CEO Ed Clark to retire in 2014

Add another to the list of the long goodbyes. TD Bank CEO Ed Clark announced Wednesday that he’ll be stepping down in 18 months, and will be replaced by his top U.S. lieutenant Bharat Masrani.

In signaling his departure so far in advance, Clark joins Rogers CEO Nadir Mohamed who gave word in February that he’d be leaving 11 months hence. In naming a successor, however, Clark helps head off much of the internecine warfare said to have erupted at Rogers as soon as Mohamed’s writ was issued.

Now 67, Clark’s departure had been rumored for a number of months. He’s been in the role 12 years, he’s amassed a long-serving team of highly-skilled deputies capable of replacing him, and perhaps most importantly, he’s accomplished essentially everything he could have wanted to achieve, while avoiding much of the hazards and hiccups that tore asunder so many CEOs south of the border.

What’s particularly noteworthy in Clark’s case is that it’s exactly there that he achieved his greatest gains, making a series of billion-dollar bets, transforming TD from a mid-sized Canadian player to one of the 10 largest banks in North America.

Clark’s bank now has arguably a greater presence in the U.S. than it does in Canada. With more than 1,300 branches stretching down the east coast to the tips of Florida. It’s now an often-told joke of Americans arriving in Toronto, expressing surprise that there are TD banks ‘up here too’.

Masrani, the successor

As the head of U.S. personal and commercial banking since 2006, Masrani, 56, was Clark’s point person overseeing the expansion. Masrani began his career with TD in 1987, as a commercial lending trainee.

When announcing Masrani’s impending appointment, the first step of which begins in July when he becomes TD’s chief operating officer, Clark lauded him “as colleague and partner almost since the time I arrived at TD”, going on to say that Masrani “helped reshape the risk appetite of the bank." The latter being no small point in a period where the management of risk has proven to be the difference between very healthy profits and absolutely catastrophic losses.

The issue of risk and the balancing of promise and peril was surely at the fore of TD’s decision to pre-empt the inevitable internal rivalries that emerge when there is an opening at the top. Once touted heirs to the throne such as Tim Hockey, TD’s head of Canadian banking, now know their role, and in Hockey’s case, have been given additional responsibilities. Another top deputy, Mike Pederson, currently in charge of wealth management, will move in Masrani’s role as the chief of U.S. operations.

This orderly re-assigning of roles based on the new pecking order differs dramatically from machinations now rumored to be playing out at Rogers, where the only certainties are that Mohamed is leaving in January, and that neither of Ted Rogers’ kids will be replacing him.

The senior executives there know only that at some point towards the end of this year, a new chieftain will be named, and that he or she will begin combing through the books to see who’s worth keeping and who is to be sacrificed in the inevitable bloodletting that accompanies a change at the top.

Ed Clark, Yahoo! Finance Canada's No. 1 for Executive of the Year, has put his bank in a position to avoid all of that, showing once again why he’s tops in his field.