TD Bank Group, Canada's second-largest bank, has announced a leadership change as it navigates through investigations into lapses of money-laundering controls at its U.S. branches. Raymond Chun, currently the group head of Canadian personal banking, will succeed longtime leader Bharat Masrani as group president and chief executive officer, effective in spring 2025.
Masrani, who has been with the bank since 1987 and has served as its leader for over a decade, will retire on April 10, 2025. Chun will first take on the role of chief operating officer (COO) on November 1, 2024, reporting to Masrani and overseeing all lines of business. He will then officially become CEO in April 2025, at which point Masrani will transition to an advisory role for the bank until October 31, 2025.
Masrani described Chun as “the right leader at the right time” during a conference call on Thursday. A “lengthy and competitive” search was conducted for a successor, which included considering external candidates. However, Chun's 30-plus years with TD Bank, working across all major divisions, played a pivotal role in his selection.
Chun's experience with TD Bank spans a diverse range of roles. He has held several positions within the bank's investing and wealth divisions in the past three years. Before being appointed the leader of Canadian personal banking in December 2023, he served as group head of wealth management and insurance for two years. Prior to that, he oversaw TD Direct Investing, a move prompted by a broader management shakeup following the departure of Dave Kelly in 2021.
During the conference call, Chun highlighted his extensive experience within the bank, emphasizing his work across various channels, including retail banking. He also underscored his familiarity with data and analytics teams, as well as his oversight of asset management and advice businesses.
Chun's experience working with Leo Salom, group head of U.S. retail banking and president and CEO of TD Bank, in America, will be particularly valuable as TD Bank grapples with legal hurdles in the U.S. related to its anti-money laundering (AML) controls. Salom will be one of Chun's direct reports starting this November when Chun becomes COO.
TD Bank's operations across both Canada and the U.S. are paramount, Masrani emphasized. Despite the AML challenges in the U.S., and Chun's primarily Canadian-focused experience, Masrani asserted that the Canadian segment is “absolutely not” going to be the main growth focus. He indicated that Chun will work closely with Salom in the coming years.
The appointment of Chun as CEO comes amid an unsettling period for TD Bank, marked by significant financial implications from the ongoing investigations. In August 2024, the bank reported a third-quarter loss of $181 million, the first since 2003, after setting aside US$2.6 billion related to the U.S. investigations. The investigations have also led to several executive departures from the bank, underscoring the gravity of the situation.
The decision to name Chun as CEO was made by the bank's board of directors, which considered both internal and external candidates. Chun is “the right leader at the right time,” Masrani said on the call. He noted that Chun is committed to addressing the AML program's shortcomings, describing it as a top priority and asserting that the bank has “the team in place to strengthen our foundations, overcome the current challenges and write the next chapter of TD’s story.”
TD Bank's announcement also included details on several other leadership changes. Riaz Ahmed, the bank's former chief financial officer and current head of its capital markets division, will retire at the end of January 2025. Tim Wiggan, who currently leads the wealth business, will take over at the capital markets division. Paul Clark will become head of wealth and Sona Mehta will assume the role of head of Canadian retail banking. All three will report to Chun, as will Salom; Barbara Hooper, group head of Canadian business banking; and James Russell, president and CEO of TD Insurance.
While the investigations into TD Bank's AML controls have led to significant financial charges and executive departures, the bank remains committed to addressing these challenges and ensuring a smooth leadership transition. Chun's appointment as CEO signifies a new chapter for the bank, with a focus on strengthening its operations and navigating through the ongoing regulatory scrutiny. As Chun takes the reins, he will need to leverage his experience and leadership skills to address the AML challenges, build trust with stakeholders, and position the bank for future success. The success of his leadership will be a defining moment in TD Bank's history, shaping the bank's trajectory in the coming years.
