TD aims to double U.S. capital markets business within four years

By John Tilak

TORONTO (Reuters) - Canada's Toronto-Dominion Bank (Toronto:TD.TO - News) plans to hire more U.S. investment bankers and target multinational clients as it pushes to double its U.S. capital markets business over the next three to four years, one of its top executives said.

TD Securities, the Canadian bank's capital markets division, is looking to invest in the energy, technology, media, telecoms and utilities sectors, Glenn Gibson, the vice chair and U.S. head of TD Securities, said in an interview. The U.S. capital markets operation has more than 600 staff members.

The company is especially keen to strengthen its position in U.S. debt capital markets, as well as mergers and acquisitions, and the sovereign, supranational and agency business, he said.

The move is part of a broader push under Chief Executive Bharat Masrani to diversify in the United States beyond its retail base.

The Toronto-based lender has grown into one of the 10 largest U.S. banks, with more than 1,300 branches along the East Coast.

Rival Royal Bank of Canada (Toronto:RY.TO - News) has already had success in the United States, where it has become a top 10 investment bank.

TD’s existing investment banking clients include AT&T (NYSE:T - News), drugmaker Actavis and private equity firm KKR & Co (NYSE:KKR - News).

"Expanding our wholesale business in the U.S. is very strategic to the overall bank,” TD's Gibson said. “But we want to do it in a focused and methodical way.”

Gibson said its U.S. retail network can help direct investment banking clients its way, and that the operation should benefit from a gradual pickup in the U.S. economy.

It is also hoping global companies that are already clients of its Canadian investment banking will include TD in more of their U.S. deals.

The company is not fazed by an oil price drop that has hurt deal making in the energy sector, he said.

"You have to be a full-cycle player," Gibson said. "Prices go up, they go down. But we are going to invest through the cycle."

Even so, Gibson acknowledged the United States is a fiercely competitive market.

“Are we going to walk in and beat J.P. Morgan on being the lead to General Motors? No,” Gibson said. “But can we be a second-tier player that leads GM's Canadian dollar bond deal and can we support them on their U.S. dollar bond issuance? Absolutely.”

(Editing by Jeffrey Hodgson and Jonathan Oatis)