A man walks by a TD building. John MacIntyre replaces Alan MacGibbon, who is retiring on Sept. 1, as chair of TD's board of directors.Spencer Colby/The Canadian Press
Toronto-Dominion Bank TD-T appointed John MacIntyre as its new board chair, capping a year-long overhaul of its executive team and board of directors, after the bank pleaded guilty to conspiracy to commit money laundering in the United States.
Mr. MacIntyre is well known in financial circles, having co-founded private equity firm Birch Hill Partners Management in 2005, and before that, co-founding the mid-market private equity group at TD Bank.
He first joined TD Bank’s board in August, 2023, and his appointment extends a shakeup that has favoured outsiders and executives who were not central to the bank’s corporate governance over the past decade.
John MacIntyre has chaired boards of CCM Hockey and HomeEquity Bank and served as a director on multiple other boards.Kathryn Hollinrake/Supplied
The new chair replaces Alan MacGibbon, who is retiring on Sept. 1. Mr. MacGibbon is a long-time TD board director and was appointed board chair in late 2023, taking over from the then-retiring chair Brian Levitt. However, last fall, the bank started overhauling its corporate governance in the wake of the money-laundering scandal in the U.S., which cut his term short.
TD also named a new chief executive officer last September, with Ray Chun taking over from Bharat Masrani, who retired. Mr. Chun’s appointment was, for many, a surprise choice. Despite joining TD in 1992, he was relatively unknown to investors.
The governance changes follow TD’s role in the money-laundering scandal, as well as a cultural shift inside the bank over the last decade. Under Mr. Masrani‘s leadership, the bank added increasingly dense layers of bureaucracy that stifled decision-making, and before the recent board and executive changes, a number of highly-respected leaders had left the institution, upending succession planning.
As the drama dragged on, TD’s share price suffered and its shares underperformed the S&P/TSX Composite Index and lagged behind competing banks. With investors growing increasingly frustrated, TD announced in January that its CEO transition would happen faster than originally planned, adding that five board directors would retire at the bank’s annual general meeting in the spring.
To replace them, new directors were named to the board – Elio Luongo, Nathalie Palladitcheff, Frank Pearn, Paul Wirth and Ana Arsov – and the bank has now named its new chair.
Since announcing this board shakeup in January, the bank’s shares have jumped 29 per cent, and TD is now the best-performing Big Six bank stock this year, by far. Clarity about the severity of the bank’s financial penalties, coupled with its governance overhaul, have given investors more confidence to own the stock again.
However, TD’s growth is still hampered by an asset cap on its U.S. business, which effectively limits the bank from expanding its American retail banking division until its anti-money-laundering programs are deemed acceptable by regulators. Upgrading these systems and adding staff is an expensive task. The bank also paid more than US$3-billion in fines as part of its guilty plea with the U.S. Department of Justice.
However, TD has found alternative ways to appease shareholders, including selling its stake in U.S. investment dealer Charles Schwab Corp. SCHW-N for about US$14-billion. TD has earmarked the proceeds for share buybacks, which will return capital to shareholders, and for investing in other businesses.
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Mr. Chun is also holding an investor day this fall to provide investors with a strategy road map for his tenure. The timing of this update aligns with Mr. MacIntyre’s assumption of the board chair role, adding to the narrative that TD is trying to forge a new path forward.
Originally from Kirkland Lake, Ont., Mr. MacIntyre is a seasoned board director who has chaired boards for CCM Hockey and HomeEquity Bank, in addition to serving as a director on multiple other boards.
Mr. MacIntyre co-founded Birch Hill, the private equity firm, with business partner Stephen Dent. Mr. Dent is on the board of directors at Bank of Montreal.