TD Bank 2002 Annual Report Download - page 76

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74
FINANCIAL RESULTS
The acquisition was accounted for by the purchase method
and the results of CT’s operations have been included in the
consolidated statement of operations from the date of acquisition.
Until October 31, 2001, goodwill arising from the transaction
was amortized on a straight-line basis over the expected period
of benefit of 10 years. Beginning November 1, 2001, the remain-
ing goodwill is tested for impairment as discussed in Note 1.
Intangible assets are being amortized on a double declining basis
over eight years, based upon their estimated useful lives.
Details of the consideration given and the fair values of the net
assets acquired are as follows:
(millions of dollars)
Fair value of assets acquired
Cash and cash equivalents $ 831
Securities purchased under resale agreements 1,219
Securities 14,082
Loans 28,352
Intangible assets
Core deposit intangibles 2,264
Other identifiable intangibles 4,596
Other assets 2,807
Assets held for sale 2,012
56,163
Less liabilities assumed and non-controlling interest in subsidiaries
Deposits 41,414
Obligations related to securities sold short 230
Obligations related to securities sold under repurchase agreements 1,099
Other liabilities 2,928
Future tax liability on intangibles 2,950
Subordinated debentures 350
Non-controlling interest in subsidiaries 375
49,346
Fair value of identifiable net assets acquired 6,817
Goodwill 1,181
Total purchase consideration $ 7,998
(millions of dollars)
Issue of common shares $ 700
Issue of preferred shares 410
Issue of trust units of subsidiary 900
Issue of subordinated notes 750
Wholesale deposits 5,263
Less: fees and expenses (25)
Total $ 7,998
(f) Sale of investment real estate
During fiscal 2001, the Bank sold certain investment real estate
for a pre-tax gain on sale of $350 million, net of deferrals.
(g) Acquisition of CT Financial Services Inc.
On February 1, 2000, the Bank acquired substantially all of the
common shares of CT Financial Services Inc. (CT), a holding
company for a group of companies which together operated as a
Canadian financial services company under the name Canada
Trust. The total consideration in respect of this purchase amount-
ed to $7,998 million, paid in cash. The cash for the acquisition
was obtained as follows.