TD Bank 2001 Annual Report Download - page 72

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70
FINANCIAL RESULTS
The acquisition was accounted for by the purchase method
and the results of CT’s operations have been included in the con-
solidated statement of income from the date of acquisition.
Goodwill arising from the transaction is being amortized on a
straight-line basis over the expected period of benefit of 10 years.
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
During the fourth quarter of fiscal 2001, TD Securities
announced a restructuring of its operations and as a result
recorded pre-tax restructuring costs of $130 million. The restruc-
turing costs relate primarily to employee severance. The Bank
expects the restructuring to be substantially complete by the end
of fiscal 2002.
In the third quarter of fiscal 2001, TD Waterhouse announced
a restructuring of its operations and pre-tax costs of $54 million
were charged to income, primarily for employee severance and
real estate rationalization. The Bank expects the restructuring
related to TD Waterhouse to be completed during fiscal 2002.
At the time of the acquisition of Newcrest in 2001, the Bank
determined it was necessary to restructure the combined opera-
tions. Pre-tax restructuring costs of $55 million were charged to
income in the first quarter of fiscal 2001, primarily for employee
severance. The restructuring was completed by the end of the
second quarter of fiscal 2001.
In 2000, following the acquisition of CT, the Bank determined
that it was necessary to restructure the combined operations.
Pre-tax restructuring costs of $475 million were recorded in the
second quarter of fiscal 2000. The restructuring costs relate
primarily to severance and employee support costs, branch
closures, rationalization of regional and head office space
requirements, lease termination, and other expenses. The Bank
expects the restructuring related to the acquisition of CT to be
substantially complete by the end of fiscal 2002.
As at October 31, 2001, the total unutilized balance of
restructuring costs of $337 million shown on the following page
was included in other liabilities in the consolidated balance sheet.
NOTE 19 Restructuring costs