TD Bank 2005 Annual Report Download - page 12

TD BANK FINANCIAL GROUP ANNUAL REPORT 2005 ToOur Shareholders
8
AT A GLANCE OVERVIEW
•Strong earnings performance in 2005.
•Annual dividend grew 16.7%.
•U.S. expansion strategy to enhance shareholder
value over the long term.
2005 BANK PERFORMANCE
TD Bank Financial Group delivered strong financial results in
2005. The Boardincreased the total annual dividend per share
this year to $1.68, an increase of 16.7% over 2004. Over the
last two years, the Board has increased the dividend four
times for a total increase of 31.3%.
The Board had a particularly busy year in 2005 in advising
and supporting the management team on strategic direction.
The closing of the TD Banknorth transaction, the pending
sale of TD Waterhouse USA to Ameritrade and the proposed
TD Banknorth acquisition of Hudson United Bancorp required
significant review and due diligence by the Boardand its
committees. The Board is confident that these moves position
TDBFG well to grow earnings and enhance shareholder value
over the long term.
CORPORATE GOVERNANCE
Corporate governance has quickly become a catchphrase.
Numerous organizations have established checklists and guide-
lines to evaluate a company’sperformance. But we believe that
good corporate governance is much more than simply adhering
to industry best practices and policies or checking boxes on a
list. It’sabout establishing a culturebased on transparency and
openness among the Board, management and shareholders.
Like all responsible companies, we measure our corporate
governance performance by benchmarking ourselves against
other leaders in governance from all sectors, and by constantly
reviewing the business environment for emerging trends and
best practices that would be appropriate for us. Wealso care-
fully review shareholder proposals and feedback, and provide
regular opportunities for shareholders to voice their concerns
and ideas for enhancing our practices.
This year we further enhanced disclosureto investors and
will introduce majority voting for directors at the Annual
Meeting in Vancouver in March 2006. This is discussed in
greater detail on page 11.
Director independence remains the cornerstone of our
approach to corporate governance. Currently 15 of 17 directors
areindependent and the Boardmeets for a portion of each
regularly scheduled meeting without management present.
Astrong, engaged Board comprised of directors with rich
and diverse experience is equally important. Their different
perspectives proved invaluable during the TD Banknorth and
Ameritrade transactions. Beyond recognizing the opportunity
for growth, the Board considered each transaction with an eye
to the best long-term interests of shareholders. And ultimately
that should be the principal goal of any Board – ensuring that
shareholders can have confidence in the Bank’s management,
financial results and strategic direction.
RECOGNIZING SERVICE
The role of director grows moredemanding each year.
Directors are expected to make significant commitments
in terms of time, accountability, shareholdings, ongoing
education and independence.
In recognition of their outstanding service to shareholders,
Iwould like to thank Donald Sobey and Michael Sopko,
directors who retired this year.
Finally, on behalf of the Board, I would like to sincerely
thank Ed Clark, his management team and the Bank’s
52,000 employees for another successful year.And in light
of our 150th anniversary, I would also like to recognize the
contributions of previous generations of TDBFG employees
who helped lay the foundation for the Bank’s ongoing
tradition of customer service excellence.
John M. Thompson
Chairman of the Boardof Directors
TO OUR SHAREHOLDERS
Chairman of the Board’s Message
This was a year of great activity and success for TD Bank Financial Group.
It was also a year marked by our 150th anniversary of serving customers and our
continued expansion to the United States.